Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Lucien v Mullally; Mullally v Lucien [2021] NSWCATCD 145 Hearing dates: 29 April 2021, 21 May 2021 and 15 September 2021 Date of orders: 25 November 2021 Decision date: 25 November 2021 Jurisdiction: Consumer and Commercial Division Before: G Blake AM SC, Senior Member The decision made on 25 November 2021 is amended pursuant to s 63 of the Civil and Administrative Tribunal Act 2013 (NSW): (amendments are shown in bold type) Decision: (1) The builder Anthony Allan Lucien is pay the owner Nerida Mullally the sum of $31,660.65 immediately. (2) If the parties are in agreement as to the costs of the two proceedings, then they shall provide proposed consent orders to the Tribunal within 14 days of the date of the orders in these reasons for decision. (3) If the parties are not in agreement as to the costs of the two proceedings, then: (a) if any party seeks a costs order, the applicant for costs (the costs applicant) must file and serve a costs application, submissions which shall address the question of whether an order should be made dispensing with a hearing and be limited to five pages, and any evidence in support, within 14 days of the date of the orders in these reasons for decision; (b) the respondent to the costs application is to file and serve any submissions which shall address the question of whether an order should be made dispensing with a hearing and be limited to five pages, and any evidence in opposition, within 14 days thereafter; (c) the costs applicant is to file any submissions in reply limited to three pages within 14 days after receipt of the submissions and any evidence of the respondent to the costs application. If you do not receive the money payable to you as directed by this order, you can get a certified copy of this money order from NCAT. You can then register it with the Local Court to enforce the order. For more information about enforcing money orders, visit the NCAT website www.ncat.nsw.gov.au. Catchwords: BUILDING AND CONSTRUCTION — Home Building Act 1989 (NSW) — Building dispute – Whether the builder breached the building contract by failing to proceed diligently with the works - Whether the builder breached the building contract by failing to rectify defective work – Whether the owner validly terminated the building contract under its terms - Whether the owner validly terminated the building contract under the general law - Whether the owner is entitled to damages for defective work, incomplete work and for delay - Whether the owner is entitled to restitution for monies paid on behalf of the builder - Whether the builder is entitled to a work order in respect of defective work – What is the amount of the money order to which the owner is entitled for damages and restitution - Whether the builder is entitled to a quantum meruit for work done at the request or for the benefit of the owner - What is the amount of the money order to which the builder is entitled for quantum meruit Legislation Cited: Home Building Act 1989 (NSW) Home Building Regulation 2014 (NSW) Work Health and Safety Act 2011 (NSW) Cases Cited: ACN 057 690 034 Pty Ltd v Mick Wykrota [2019] NSWSC 197 Angelopoulos v Sabatino (1995) 65 SASR 1 Brenner v First Artist Management Pty Ltd [1993] 2 VR 221 DCT Projects Pty Ltd v Champion Homes Sales Pty Ltd [2016] NSWCA 117 Health Care Complaints Commission v Ng [2015] NSWCATOD 85 Hometeam Constructions Pty Limited v McCauley [2005] NSWCA 303 Kitto v TGSBC Pty Ltd [2004] WABDT 28 Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115; [2007] HCA 61 Lawrence v Ciantar; Ciantar v Lawrence [2019] NSWSC 464 Leeda Projects Pty Ltd v Zeng (2020) 61 VR 384; [2020] VSCA 192 Lumbers v W Cook Builders Pty Ltd (in liq) (2008) 232 CLR 635; [2008] HCA 27 Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221; [1987] HCA 5 Toplace Pty Ltd v Rashidianfar [2021] NSWCATAP 235 Roude v Helwani [2020] NSWCA 310 Vasco Investments Ltd v Morgan Stanley Australia Ltd [2014] VSC 455 Woodward v D J & T L Mellross Pty Ltd [2018] NSWCATAP 179 Xtraordinary Constructions Pty Ltd v Luppino [2021] SASC 132 Texts Cited: J Edelman, McGregor on Damages (21st edition, 2020, Thomson Reuters) New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 6 May 2014 Rawlinsons Australian Construction Handbook (38th edition, 2020, Rawlinsons Publishing) Category: Principal judgment Parties: HB 19/48969: Anthony Allan Lucien (Applicant) Nerida Mullally (Respondent) HB 19/56785: Nerida Mullally (Applicant) Anthony Allan Lucien (Respondent) Representation: Counsel: J Hyde (Anthony Allan Lucien) M Fraser (Nerida Mullally) Solicitors: Wilkinson Building & Construction Lawyers Pty Ltd (Anthony Allan Lucien) Fielding Robinson Lawyers until June 2021; AWB Lawyers from July 2021 (Nerida Mullally) File Number(s): HB 19/48969; HB 19/56785 Publication restriction: Nil REASONS FOR DECISION Overview 1. These two proceedings, which were heard together, involve disputes arising out of a contract to do alterations and additions (the works) at a property at Newtown (the site or the property according to the context) entered into on 4 October 2017 between the owner, Nerida Mullally, and the builder, Anthony Allan Lucien. 2. I have decided that the owner is entitled to recover the sum of $27,700.15 from the builder. The factual background 1. The factual background of the two proceedings is not in dispute. The parties and the property 1. Since 19 November 2008, the builder has held contractor licence no. 210419C under the Home Building Act 1989 (NSW) (HB Act). 2. At all relevant times, the builder has carried on business under the business names TAL Buiiding Solutions, and Smith & Sons Renovations & Extensions Maroubra. 3. At all relevant times, the owner has been the owner of the property. The contract 1. On 4 October 2017, the parties executed the contract which was in the form of NSW Fair Trading "Home building contract for work over $20,000" and specified a contract price of $812,770.00 inclusive of GST, and comprised the following documents: 1. NSW Fair Trading "Home Building contract for work over $20,000" general conditions (the general conditions); 2. Special conditions: "8dfs Addendum to Home Building Contract for work over $20000-00" (the special conditions); 3. Alexandra Kidd specifications dated 22 July 2016: "Documentation package 1190" (the AK specifications) comprising drawings with the following drawing number and title: AKD-001 (Ground Floor SOW Plan), AKD-002 (First Floor SOW Plan), AKD-003 (Ground Floor Lighting + Mechanical Layout), AKD-004 (First Floor Lighting + Mechanical Layout), AKD- 005 (Ground Floor Electrical Layout), AKD-006 (First Floor Electrical Layout), AKD-007 (Ground Floor Floor-Ceiling-Wall Finishes), AKD-008 (First Floor Floor-Ceiling-Wall Finishes), AKD-11X (Upholstered Bed Head Design Elevation), AKD-100 (Laundry Joinery), AKD-101 (Kitchen Plan Section), AKD-102 (Kitchen Elevation), AKD-103 (Kitchen Island Bench Elevation and Sections), AKD-104 (Ground Floor Bathroom Plan), AKD-105 (Ground Floor Bathroom Elevations), AKD-106 (First Floor Bathroom Plan Layout), AKD-107 (First Floor Bathroom Elevations), AKD-108 (First Floor Bathroom Elevations), AKD-109 (Living Room Entertainment Unit), AKD-110 (Wardrobe Guest Bed Section & Elevation), AKD-111 ( Storage Room Robe Section & Elevation), AKD-112 (Bedroom 1 Plan and Elevation), AKD-113 (1st Floor Bedroom 1 Robe Plan and Elevation), AKD-114 (Bedroom 2 Walk-In Robe Plans), AKD-115 (1st Floor Bedroom 2 Walk-In Robe Elevation-Sections), AKD-116 (New Stair Concept Details) and AKD-117 (Detail Page); 4. Nerida Mullally specifications dated 29 September 2017 (the owner specifications); 5. Paul Wilsher Design plans dated 22 September 2015 comprising drawings DA.1001, DA.1002, DA.1003, DA.1004, and DA.1005 (the PW plans); 6. Camstruct Consulting Pty Ltd structural plans comprising drawings 15171- S01(A) dated 6 May 2016, 15171-S02(A) dated 6 May 2016, 15171-S03(A) dated 6 May 2016, 15171-S04(A) dated 6 May 2016, 15171-S05(B) dated 11 May 2016, 15171-S06(B) dated 10 May 2016, 15171-S07(A) dated 6 May 2016 and 15171-S08(A) dated 6 May 2016 (the CC plans); 7. Camstruct Consulting Pty Ltd stormwater drainage plans dated 12 August 2016 comprising drawings 15171-SW01(1), 15171-SW01(1) and 15171-SW03(1); 8. Paul Wilsher BASIX Report A234097 dated 4 September 2015; 9. Quote - Smith & Sons dated 11 July 2017 (the 11 July 2017 quote); 10. Alexandra Kidd specification documents dated July 2016 comprising the documents with the following number and heading: WC001 Wallcoverings, WD001 Timber Veneer, ST001 Stone, PT001 Paint, LF001 Light Fixtures, LA001 Laundry, LP001 Laminate, BA001 Kitchen, H01 Hardware, CT001 Ceramic Tiles, BA001 Bathroom, CA001 Carpet; 11. Diagram of Sanitary Drainage provided by Sydney Water dated 9 January 2015; 12. Acoustic Report prepared by DK Acoustics Pty Ltd dated 26 November 2015 (the acoustic report); 13. Bay Street Gardens Landscape plan dated 5 July 2016 and 7 July 2016 (the BSG plan); 14. Detail Survey prepared by RGM Property Surveys issued 12 February 2015. The commencement of the works 1. By no later than 1 March 2018, the builder commenced work under the contract. Variations 1. The builder made 16 claims for variations of the contract (variations # 1 to # 16). The owner signed variations # 1, #2, # 4, # 5 and #10, but did not sign variations # 3, # 6 to # 9, and # 11 to # 16. Progress payments 1. Following payment of the deposit, the builder made 7 claims for progress payments. The owner paid a total of $646,973.31 exclusive of GST and $711,670.62 inclusive of GST for progress claims # 1 to # 6, and disputed progress claim # 7. The termination of the contract 1. On 14 December 2018, the owner, following altercation with the builder, called the police who told him to leave the site, and changed the locks. 2. On 17 December 2018, the owner and the builder agreed in a conversation that the builder would return to the site and complete the works. 3. Between 18 January 2019 and 24 April 2019 there was correspondence between the builder's lawyers and the owner's lawyers which culminated in the following correspondence: 1. the document dated 5 April 2019 entitled "owner's notice of default" from the owner's lawyers to the builder's lawyers (the 5 April 2019 notice); 2. the document dated 24 April 2019 entitled "owner's notice of termination" from the owner's lawyers to the builder's lawyers enclosing (the 24 April 2019 notice); 3. the letter 6 May 2019 from the builder's lawyers to the owner's lawyers asserting that the owner had repudiated the contract, and advising that the builder accepted that repudiation (the 6 May 2019 letter). The procedural history The HB 19/48969 proceedings 1. On 31 October 2019, builder commenced proceedings HB 19/48969 against the owner by filing a home building application in which he claimed $142,031.73 in debt being the total of outstanding invoices and in quantum meruit together with interest under the contract, or damages for repudiation of the contract (the HB 19/48969 proceedings). 2. On 31 October 2019, the builder filed points of claim in which he relevantly claimed: 1. $111,192.27, being the total of the balance of progress claim # 7, and the final progress claim; 2. $16,323.80 on a quantum meruit basis for all works done at the owner's request; 3. interest on overdue payments; 4. damages for the wrongful termination and repudiation of the contract by the owner arising from the 24 April 2019 notice; 5. costs. 1. On 19 December 2019, the owner filed points of defence in which she relevantly claimed: 1. she is not liable for the balance of progress claim # 7 after allowing credits for money she expended on behalf of the builder; 2. she is not liable for the final progress claim being the builder has no entitlement to the payment; 3. she is not liable for some of the variation claims; 4. she did not wrongfully terminate and repudiate the contract, and that she validly terminated the contract in accordance with its terms; 5. a set off against any monies found to be owing by her to the builder. The HB 19/56785 proceedings 1. On 19 December 2019, the owner commenced proceedings HB 19/56785 against the builder by filing a home building application in which she claimed $127,516.07 as damages for breach of the contract being the cost of completing the works or alternatively the diminution in value of the property due to the defects in the works, and the loss from the delay in completing the works (the HB 19/56785 proceedings). 2. On 19 December 2019, the owner filed points of claim (which were amended in minor respects by amended points of claim filed on 14 October 2020) in which she relevantly claimed: 1. the builder breached the contract by failing to diligently proceed with the works, failing to remedy defective work and failing to remove faulty or unsuitable materials; 2. she terminated the contract in accordance with its terms when the builder failed to remedy those breaches after being given notice of them; 3. the costs of the rectification of the works for breach of the statutory warranties in s 18B(1) of the HB Act; 4. alternatively, the diminution in value of the property due to the defects in the works; 5. damages for delay; 6. damages for breach of the contract, including the costs of the completion of the works; 7. interest; 8. costs; 9. an order that the builder provide to her all certificates in relation to the works carried out by the builder and which are necessary for the owner to obtain an occupation certificate in respect of the property. 1. On 22 September 2020, the builder filed points of defence in which he relevantly claimed: 1. he was entitled to extensions of time totalling 305 business days and denied that he failed to proceed diligently with the works; 2. the owner was not entitled to terminate the contract; 3. the owner has waived her rights to enforce the statutory warranties in respect minor defects because of her wrongful termination of the contract; 4. the owner cannot recover for the cost of incomplete works because of her wrongful termination of the contract; 5. the owner is not entitled to any certificates in relation to the works until final payment is made to him, or the owner has waived such an entitlement. The hearing 1. On 29 April 2021, 21 May 2021 and 15 September 2021, the hearing of the two proceedings took place. The first two days were conducted by audio-visual link, and the third day was conducted by telephone. 2. The builder tendered the following evidence which was admitted without objection: 1. the witness statement of himself dated 31 October 2019 and the accompanying exhibit (Ex B1) (the Lucien witness statement); 2. the affidavit of himself sworn on 12 September 2020 and the accompanying exhibit (Ex B2) (the first Lucien affidavit); 3. the affidavit of himself sworn on 10 December 2020 (Ex B3); 4. the affidavit of Michael Wilkinson (Mr Wilkinson), the solicitor of the builder, sworn on 9 September 2020 (Ex B4); 5. the report of Anthony Burton (Mr Burton) dated 6 September 2020 (Ex B5) (the Burton report); 6. the report of Kanin Mungkarndee (Mr Mungkarndee) dated 14 September 2020 (Ex B6) (the Mungkarndee report); 7. the report of Peter Lee (Mr Lee) dated 14 December 2020 (Ex B7) (the Lee report) which included the amended scott schedule dated 9 November of the parties (the amended scott schedule). 1. The owner tendered the following evidence which was admitted without objection: 1. the affidavit of herself sworn on 3 April 2020 and the accompanying exhibits (Ex O1) (the first Mullally affidavit); 2. the affidavit of herself sworn on 13 October 2020 and the accompanying exhibit (Ex O2) (the second Mullally affidavit); 3. the report of Adrian Jamieson (Mr Jamieson) dated 8 April 2020 (Ex O3) (the first Jamieson report); 4. the report of Mr Jamieson dated 14 October 2020 (Ex O4) (the second Jamieson report); 5. the report of Scott Clarkson (Mr Clarkson) dated 29 September 2020 (Ex O5) (the Clarkson report); 6. the report of Hilary Pearce (Ms Pearce) dated 5 March 2020 (Ex O6) (the Pearce report); 7. the report of Chris Zervos (Ms Zervos) dated 27 March 2020 (Ex O7) (the Zervos report); 8. the report of Aaron Kyle (Mr Kyle) dated 9 October 2020 (Ex O8) (the Kyle report); 9. the affidavit of Mr Kyle affirmed on 12 October 2020 (Ex O9); 10. the report of Sebastian Zakrzewski (Mr Zakrzewski) dated 13 March 2020 (Ex O10) (the Zakrzewski report); 11. document headed "Quantum of Variations and Additional Work" received by the Tribunal on 13 May 2021 (Ex O11); 12. an enlargement of a plan of the property in the Kyle report (Ex O11); 13. three photographs of the laundry (Ex O12). 1. On 29 April 2020, the owner sought to tender the affidavit of herself sworn on 15 April 2021 and the accompanying exhibit (the third Mullally affidavit) (MFI 1). I rejected the tender and delivered short oral reasons. 2. The builder and the owner jointly tendered the following evidence: 1. the joint report of Ms Pearce and Mr Mungkarndee dated 27 October 2020 (Ex J1); 2. the joint report of Messrs Burton and Clarkson dated 25 March 2021, and Messrs Jamieson and Lee dated 13 April 2021 (Ex J2) (the joint building report); 3. the builder's summary of claims received by the Tribunal on 20 May 2021 as corrected (Ex J3); 4. the owner's summary of claims received by the Tribunal on 20 May 2021 as corrected (Ex J4). 1. The builder and the owner gave oral evidence. Messrs Burton, Clarkson, Kyle, Jamieson and Lee gave oral evidence concurrently. 2. The owner's claims were set out in the amended scott schedule as follows: 1. the cost of rectifying defective works: "Part 1 – Defective Works" (items 1 to 18); 2. the cost of completing incomplete works: - "Part 3 – Incomplete Works (as at termination)" (items 39 to 73); "Part 5 – Work within Builder's scope paid for by Owner after termination (i.e. cost to complete)" (items 82 to 102); 3. the amount paid by the owner on behalf of the builder: "Part 4 – Work within Builder's scope paid for by Owner prior to termination" (items 74 to 81); 4. the loss of the owner by reason of the delay of the builder: "Part 6 – delay" (item 103). 1. The builder's claims were set out in the amended scott schedule as follows: "Part 2 – Variations & Additional Work" (items 19 to 37). 2. During the hearing the parties advised their position on the following issues: 1. as to defective works (items 1-18 of the amended scott schedule): 1. they agreed that items 2.1, 2.2, 3, 4, 5.1, 5.2, 6, 7, 8, 9, 10, 11.3, 13, and 15, and part of item 14, are defective works and the reasonable cost of their rectification is $17,200.00 exclusive of GST; 2. they agreed that items 1.1 and 1.2 are not defective works; 3. they disagreed as to whether 11.4 and part of item 14 are defective works; 4. they agreed that items 11.1 and 12.1 are defective works, but disagreed as to the reasonable cost of their rectification; 5. they disagreed as to whether the owner is entitled to recover any amount for items 16-18 (preliminaries, overheads and profit of 15%, and contingency of 15%); 1. as to variations and additional works (items 19-37 of the amended scott schedule from which variation # 9 been omitted): 1. they agreed that the builder is entitled to claim items 19, 20, 22, 23, 24, 25, 26, and 27 (variations # 1, # 2, # 4, # 5, #6, # 7, # 8, and #10) as a variation and the total amount due is $14,727.21 exclusive of GST; 2. they agreed that the owner is entitled to claim item 28 (variation # 11) as a variation and the total amount to be credited is $6,865.00 exclusive of GST; 3. the builder did not press items 21, 29 and 33 (variations # 3, # 12 and # 16); 4. they disagreed as to whether the builder is entitled to claim items 30 to 32 (variations # 13 to # 15) as a variation; 5. the builder reduced the amount claimed for item 32 (variation # 15) to $400.00 exclusive of GST; 6. they disagreed as to whether the builder is entitled to claim items 34 to 37 as additional works; 7. by reason of the payment of agreed variations the builder was seeking on order for the payment of the amount claimed for items 24, 30 to 32 and 34 to 37 (variations # 6, and # 13 to # 15, and additional works); 1. as to incomplete works as at 24 April 2019 (items 39-73 of the amended scott schedule): 1. the owner did not press items 41, 53 (first), 60 and 61; 2. they agreed that items 44, 46, 51, 52, 57, 58, 59, 64, 69, 70 and 73 are incomplete works and the reasonable cost of their completion is $3,575.00 exclusive of GST; 1. as to works within the scope of the contract paid by the owner to third parties prior to 24 April 2019 (items 74-81 of the amended scott schedule): 1. they agreed that the owner is entitled to a credit of $6,810.00 exclusive of GST for item 77; 2. they agreed that the owner is entitled to a credit of $6,545.45 exclusive of GST for item 78; 3. they agreed that the owner is not entitled to a credit for item 81; 4. they disagreed as to whether the owner is entitled to a credit for the remaining items; 1. as to works within the scope of the contract paid by the owner to third parties after 24 April 2019 (items 82-102 of the amended scott schedule): 1. they agreed that the owner is entitled to $6,251.82 exclusive of GST for items 82, 85 and 102; 2. they agreed that the owner is entitled to a credit for items 88, 92, and 100, but disagree as to the amount; 3. they disagreed as to whether the owner is entitled to a credit for the remaining items; 1. as to delay costs (item 103 of the amended scott schedule), they disagreed as to whether the owner is entitled to the claimed loss of $151,500.00. 1. On 15 September 2021, the owner's lawyers sent an email to the Tribunal attaching a letter dated 13 May 2021 from the owner's lawyers to the builder's lawyers (the 13 May 2021 letter) enclosing a document headed "Contract Inclusions" (the Contract Inclusions document) and advising that the owner proposed to tender the 13 May 2021 letter and the Contract Inclusions document. As these documents were not tendered and were the subject of submissions by the builder I have marked them (MFI 2). 2. The builder relied on the following written submissions: 1. the builder's submissions dated 16 July 2021 (the builder's 16 July 2021 submissions); 2. the builder's submissions in reply dated 20 August 2021 (the builder's 20 August 2021 submissions). 1. The owner relied on the following written submissions: 1. the owner's submissions on issues of law received on 21 May 2021 (the owner's 21 May 2021 submissions); 2. the owner's submissions dated 19 July 2021 (the owner's 19 July 2021 submissions); 3. the owner's submissions in reply dated 28 July 2021 (the owner's 28 July 2021 submissions); 4. the owner's submissions in reply dated 15 September 2021 to the builder's 20 August 2021 submissions (the owner's 15 September 2021 submissions). 1. Each of the builder and the owner made oral submissions. 2. At the conclusion of the hearing I made procedural directions for the provision of further submissions by the parties and reserved my decision. 3. The owner provided submissions dated 28 September 2021 regarding items 65, 79, 80 and 88 of the amended scott schedule (the owner's 28 September 2021 submissions). 4. The builder provided the following submissions: 1. the builder's submissions in reply dated 29 September 2021 to the owner's 15 September 2021 submissions (the builder's 29 September 2021 submissions); 2. the builder's response dated 5 October 2021 to the owner's 28 September 2021 submissions (the builder's 5 October 2021 submissions). The jurisdiction of the Tribunal The applicable provisions of the HB Act 1. Part 2C (ss 18A-18G) contains provisions dealing with statutory warranties. Section 18B deals with warranties as to residential building work, and relevantly provides: 18B Warranties as to residential building work (1) The following warranties by the holder of a contractor licence, or a person required to hold a contractor licence before entering into a contract, are implied in every contract to do residential building work— (a) a warranty that the work will be done with due care and skill and in accordance with the plans and specifications set out in the contract, (b) a warranty that all materials supplied by the holder or person will be good and suitable for the purpose for which they are used and that, unless otherwise stated in the contract, those materials will be new, (c) a warranty that the work will be done in accordance with, and will comply with, this or any other law, (d) a warranty that the work will be done with due diligence and within the time stipulated in the contract, or if no time is stipulated, within a reasonable time, (e) a warranty that, if the work consists of the construction of a dwelling, the making of alterations or additions to a dwelling or the repairing, renovation, decoration or protective treatment of a dwelling, the work will result, to the extent of the work conducted, in a dwelling that is reasonably fit for occupation as a dwelling, (f) a warranty that the work and any materials used in doing the work will be reasonably fit for the specified purpose or result, if the person for whom the work is done expressly makes known to the holder of the contractor licence or person required to hold a contractor licence, or another person with express or apparent authority to enter into or vary contractual arrangements on behalf of the holder or person, the particular purpose for which the work is required or the result that the owner desires the work to achieve, so as to show that the owner relies on the holder's or person's skill and judgment. … 1. Section 18E deals with proceedings for breach of warranty, and relevantly provides: 18E Proceedings for breach of warranty (1) Proceedings for a breach of a statutory warranty must be commenced in accordance with the following provisions— (a) proceedings must be commenced before the end of the warranty period for the breach, (b) the warranty period is 6 years for a breach that results in a major defect in residential building work or 2 years in any other case, (c) the warranty period starts on completion of the work to which it relates (but this does not prevent proceedings from being commenced before completion of the work), … 1. Part 3A contains provisions for resolving building disputes and building claims. Division 1 contains definitions, and relevantly provides: 48A Definitions (1) In this Part— building claim means a claim for— (a) the payment of a specified sum of money, or … that arises from a supply of building goods or services whether under a contract or not, or that arises under a contract that is collateral to a contract for the supply of building goods or services, but does not include a claim that the regulations declare not to be a building claim. … building goods or services means goods or services supplied for or in connection with the carrying out of residential building work or specialist work, being goods or services— (a) supplied by the person who contracts to do, or otherwise does, that work, or … goods, services and supply have the same meanings as in Part 6A of the Fair Trading Act 1987. 1. Part 3A Division 4 (ss 48K-48MA) contains the provision dealing with the jurisdiction of the Tribunal in relation to building claims. Section 48K relevantly provides: 48K Jurisdiction of Tribunal in relation to building claims (1) The Tribunal has jurisdiction to hear and determine any building claim brought before it in accordance with this Part in which the amount claimed does not exceed $500,000 (or any other higher or lower figure prescribed by the regulations). … (3) The Tribunal does not have jurisdiction in respect of a building claim relating to building goods or services that have been supplied to or for the claimant if the date on which the claim was lodged is more than 3 years after the date on which the supply was made (or, if made in instalments, the date on which the supply was last made). … (7) The Tribunal does not have jurisdiction in respect of a building claim arising from a breach of a statutory warranty implied under Part 2C if the date on which the claim is lodged is after the end of the period within which proceedings for a breach of the statutory warranty must be commenced (as provided by section 18E). 1. Schedule 1 contains definitions and other interpretative provisions. Clause 2 contains a definition of "residential building work", and relevantly provides: 2 Definition of "residential building work" (1) In this Act, residential building work means any work involved in, or involved in co-ordinating or supervising any work involved in— … (b) the making of alterations or additions to a dwelling, or (c) the repairing, renovation, decoration or protective treatment of a dwelling. … 1. Clause 3 contains a definition of "dwelling", and relevantly provides: 3 Definition of "dwelling" (1) In this Act, dwelling means a building or portion of a building that is designed, constructed or adapted for use as a residence (such as a detached or semi-detached house, transportable house, terrace or town house, duplex, villa-home, strata or company title home unit or residential flat). … Consideration 1. I am satisfied that the Tribunal has jurisdiction to determine the proceedings for the following reasons: 1. the claims of the builder against the owner, and the owner against the builder, which is each a building claim within the meaning of that expression in s 48A of the HB Act when read with the definitions of building services and supply in s 48A and the definition of residential building work and dwelling in Sch 1 cll 2(1)(b) and (c) and 3(1) of the HB Act, is for an amount within the jurisdiction limit of $500,000 of the Tribunal under s 48K(1) of the HB Act; 2. as to the claim of the builder against the owner, the HB 19/48969 proceedings were commenced within the period 3 years since the supply of building services as required by s 48K(3) of the HB Act; 3. as to the claim of the owner against the builder, the HB 19/56785 proceedings were commenced within the period 2 years since the last work was performed by the builder as required by s 18E(1)(c) of the HB Act, and so the jurisdiction of the Tribunal is not excluded pursuant to s 48K(7) of the HB Act. The issues 1. Following the concessions made by the parties, the following issues remained for determination: 1. what is the legal characterisation and consequences of the events on 14 and 17 December 2018; 2. whether the builder failed to proceed with the works diligently in breach of the contract as at 5 April 2019; 3. whether the builder failed to remedy defective work or remove faulty or unsuitable materials in breach of the contract as at 5 April 2019; 4. whether the owner validly terminated the contract under its terms; 5. whether the owner validly terminated the contract under the general law; 6. whether the works undertaken by the builder were defective, and if so the reasonable cost of rectifying the defects; 7. whether the builder ought to be ordered to pay damages rather than rectify the defective work; 8. whether the works undertaken by the builder were incomplete, and if so the damages recoverable by the owner; 9. whether the owner paid for work to be undertaken by the builder, and if so is entitled to restitution of the amount paid; 10. whether the owner is entitled to damages for damages for delay; 11. whether the builder is entitled to be paid for variations and additional works, and if so what amount; 12. whether any, and if so what, costs order should be made in respect of the two proceedings. 1. Neither the owner in the owner's 19 July 2021 submissions and her oral submissions nor the builder in the builder's 16 July 2021 submissions and his oral submissions made any submissions about progress claim # 9. In these circumstances I have not determined whether the builder became entitled to be paid for progress claim # 9. 2. Before determining these issues it is necessary to make findings about the reliability and credibility of the builder and the owner, whose evidence is critical to the determination of these issues. The reliability and credibility of the builder and the owner The relevant legal principles 1. In Health Care Complaints Commission v Ng [2015] NSWCATOD 85 (Ng) at [128]-[130] the Tribunal set out the following observations on assessing the credit of a witness: "[128] We found the recent discussion by Sackar J in Campbell v Campbell [2015] NSWSC 784 at [73] to [79] to be of considerable assistance. To paraphrase his Honour: (1) Where a trial judge is faced with a stark choice between irreconcilable accounts, the credibility of the parties' testimony, the trial judge's assessment of the character of witnesses and the manner in which the witnesses give evidence is of primary importance: McGraddie v McGraddie [2013] UKSC 58; [2013] 1 WLR 2477. (2) The rational resolution of an issue involving the credibility of witnesses will require reference to, and analysis of, any evidence independent of the parties which is apt to cast light on the probabilities of the situation: Camden v McKenzie [2007] QCA 136; [2008] 1 Qd R 39 at [34] Keane JA; referred to with approval by Leeming JA in New South Wales v Hunt [2014] NSWCA 47 at [56]. (3) A court, in cases involving events which occurred long before the litigation, usually prefers to rely upon contemporaneous, or near contemporaneous, documents, which will often provide valuable and, usually, more revealing, information than what may be flawed attempts at recollection of those facts by persons with an interest in the outcome of the litigation: Bathurst Regional Council v Local Government Financial Services Pty Ltd (No 5) [2012] FCA 1200 at [1247]. Greater weight is usually accorded to such documents, as often they provide a safer repository of reliable fact, particularly when it is clear that they have been prepared by a person with no reason to misstate those facts in the documents and where there is no suggestion that the documents are other than genuine: Hughes v St Barbara Mines Ltd [No 4] [2010] WASC 160, per Kenneth Martin J, at [157]. [129] His Honour also referred at [75] to the dissenting speech of Lord Pearce in Onassis v Vergottis [1968] 2 Lloyd's Rep 403, who stated at 431: a witness, however honest, rarely persuades a Judge that his present recollection is preferable to that which was taken down in writing immediately after the accident occurred. Therefore, contemporary documents are always of the utmost importance. And lastly, although the honest witness believes he heard or saw this or that, is it so improbable that it is on balance more likely that he was mistaken? On this point it is essential that the balance of probability is put correctly into the scales in weighing the credibility of a witness, and motive is one aspect of probability. All these problems compendiously are entailed when a Judge assesses the credibility of a witness; they are all part of one judicial process and in the process contemporary documents and admitted or incontrovertible facts and probabilities must play their proper part." [130] The credibility of a witness and his, or her, veracity may also be tested by reference to the objective facts proved independently of the evidence given, in particular by reference to the documents in the case, by paying particular regard to his, or her, motives, and to the overall probabilities: Armagas Ltd v Mundogas S.A. (The "Ocean Frost") [1985] 1 Lloyd's Rep 1 at [57]; In the matter of Kit Digital Australia Pty Ltd (in liq) [2014] NSWSC 1547 at [7]." The builder 1. I have some reservations about the reliability and credibility of the builder. While cross-examination did not undermine his evidence in any substantial way, his evidence was often vague and lacked precision where it would have been expected he had detailed knowledge of the facts in dispute. The owner 1. I similarly have some reservations about the reliability and credibility of the owner. While cross-examination did not undermine her evidence in any substantial way, on several occasions she made speeches in support of her case rather than confining herself to answering the question. Conclusion 1. Where there are irreconcilable accounts in the evidence of the builder and the owner, I have applied the principles in Ng at [128]-[130] in weighing their evidence and in deciding which account I prefer. What is the legal characterisation and consequences of the events on 14 and 17 December 2018? Introduction 1. There is no dispute between the parties that: 1. on 14 December 2018, the police directed the builder to leave the site; 2. on 17 December 2018, the owner and the builder agreed that they would continue to perform their obligations under the contract. 1. There is disagreement between the parties as to the circumstances in which the police directed the builder to leave the site, and consequently the legal characterisation and consequences of the events on 14 and 17 December 2018. 2. In his opening the builder contended that on 14 December 2018 the owner terminated the contract, and on 18 December 2018 the owner reaffirmed terminated the contract. On the basis of this contention the builder further contended that under clauses 5 and 6 of the general conditions the time for commencement began on, and completion began to run from, 18 December 2018. The evidence 1. The evidence relevant to this issue is set out in the applicable contractual terms and correspondence between the parties, the first Mullally affidavit, the first Lucien affidavit, and the oral evidence of the builder and the owner. The applicable contractual terms 1. Clause 7 of the general conditions relevantly provided: "Extension of time If the work is delayed by: … • a suspension of the work by contractor under Clause 24, or • any other matter, cause or thing beyond the control of the contractor, the contractor will be entitled to a reasonable extension of time to complete the work. … … 1. Clause 19 of the general conditions relevantly provided: "Access to site and materials handling … The contractor must allow the owner … access to the site to view and inspect the work in progress. The owner must allow the contractor, and any employee or sub-contractor of the contractor, access to the site during the currency of this contract. The owner or the owner's representative must communicate and deal with the contractor personally or with such person nominated by the contractor as the contractor's authorised representative. The owner must not give directions to the contractor's employees or sub-contractors." 1. Clause 24 of the general conditions relevantly provided: "Suspension of work by contractor If the owner, without reasonable and substantial cause: … • denies the contractor or the contractor's sub-contractors access to the site so as to prevent the work from proceeding, …, the contractor may, without prejudice to any other rights under the contract, suspend the work by giving written notice to the owner in accordance with Clause 28 (Giving of Notices) specifying the reason." 1. Document WD001 of the AK specifications specifies that the timber flooring to the ground floor level and staircase is to have a 20mm thickness. The correspondence between the parties 1. On 16 December 2018 at 4.53pm, the owner in an email to Mr Wilkinson (the 16 December 2018 at 4.53pm email): 1. set out an account of verbal threats made by the builder to her on 14 December 2018: "If you were a man I would punch you in the face." "I will make sure that you never get to move into your house. I will smash it all down." as a result of which: 1. she advised him the build was over, and instructed him to leave the property; 2. she called the police who when they attended the site instructed two employees of the builder to leave the property; 3. she subsequently changed the locks to the property; 1. advised that she was willing to meet with the builder to discuss "what possible (if any) grounds exist for the build to proceed". 1. On 18 December 2018 at 2.24pm, the owner in an email to Mr Wilkinson advised that following the meeting on the previous day she and the builder had a telephone conversation in which they agreed to complete the build, and that site keys had been made available at 6.00am on that day (the 18 December 2018 at 2.24pm email). The first Mullally affidavit 1. In the first Mullally affidavit the owner sets out the following account of the events on 14 December 2018 and their aftermath (at [35]-[44] and [119]-[121]): "35 On Friday 14 December 2018 I attended the Property to see how the Works were going. 36 The Builder was on site with the site foreman, Mr Tengstrom. At approximately 7:15am I said to the Builder and Mr Tengstrom: "The planks can't be laid this morning, as you are installing the planks incorrectly. Fixing the planks on battens at 450mm centres over a concrete slab is the correct method of installation for 19mm planks, however the planks to be installed are 16mm and these require a different method of fixing." 37 I also said words to the following effect: "I am concerned as the moisture barrier which had been installed over five weeks ago has become compromised by tears due to tradesmen walking on it. Also, the plasterers are working at the same time as the painters, so the painting job is going to be compromised by gyprock dust. " 38 The discussion escalated into an argument culminating in the Builder raising his clenched fist to my face and saying words to the following effect: "If you were a man I would punch you in the face". 39 I was scared and stepped away from the Builder and said words to the following effect: "Leave my properly." 40 The Builder refused to leave the Property and said words to the following effect of: "I will make sure that you never get to move into your house. I will smash it all down". 41 At this point it was 7:26am and I phoned the police and reported the Builder's intimidating and threatening behaviour. The Builder was standing near me whilst I was on the phone to the police making the report, and he said words to the following effect: "You have no witnesses". 42 The police said: "We will attend your property." 43 As I was in fear for my safety, I waited outside my house until the police attended at 8:12am. The police attended my property and discovered that the Builder had left the premises via the back door prior to their arrival. 44 The police spoke to the two employees who were left on site (Mr Tengstrom & Mr Archer), took their details and instructed them to leave my property. The police advised me to change the locks to my property. The police left and advised if there was any further trouble to contact them immediately. The police report number for this incident is E72344381. … … 119 After the police intervention (refer to paragraphs 35 to 45 above) on 14 December 2018 a meeting was held on 17 December 2018 with the Builder and his solicitor present. The Builder's solicitor gave an undertaking that he would assist in the resolution of ail existing and any future issues (if any) and confirmed that after the meeting he would ensure the Builder provided: a. A current schedule of all outstanding works and (realistic) estimated dates of completion noted beside each item; b. A copy of the invoice/s Mr Lucien received for all roof glazing and skylights; c. A copy of Mr Lucien's purchase order (including specifications) for the Vergola insert; d. A copy of Mr Lucien's purchase order (including specifications) for the Hella Venetian blind; e. Notification of the intended date that the water leak in the upstairs bathroom roof, through the light fitting, will be rectified; f. Notification of the intended date that the Rinnai hot water system will be semi- recessed into the wall; and g. Notification that the plastering has been completed. 120 The Builder's solicitor said to me words to the following effect (whilst looking at the list of documents referred to at paragraph 119(a) - (g) out and given to him): "I will undertake to keep the build on track and ensure that you get the copies of the outstanding documents you requested. We are going to get the build done ....If there are any future issues contact me and I will resolve it." 121 I know the special meaning of the word "undertake" when a solicitor says it. The use of that word made me feel very relieved and optimistic that my build would be back on track and kept on track. Because of this I decided to continue the build with the Builder. After the meeting I phoned the builder and advised him of my decision to continue and that I would put the keys to the site in the letterbox." The first Lucien affidavit 1. In the first Lucien affidavit the builder sets out the following account of the events on 14 December 2018 and their aftermath (at [35]-[44] and [119]-[121]): "35 In relation paragraph 35, I agree that the owner attend the property. 36 In relation to paragraph 36. I say in reply that in addition to Mr. Tegstrom, Warren Archer, the painting contractors, and the plastering contractor were also on site. I agree that the owner may have made a statement to that effect. The boards were not being laid as the owner had changed her mind after the battens had been fixed for 19mm boards, giving rise to another variation to the contract. The conversation continued to the following effect: I said: "Nerida there will need to be a variation because you have changed the boards from the 19mm boards you had selected, and we have laid the battens for. Now you want a narrower width with 16mm bords, and we now need to lift up all the battens and relay them to fix the narrow 16mm floorboards to." Nerida said: "Your fucking full of shit, you're a fucking idiot, your useless, you're a wog..." I said: "Your comments are inappropriate ..." 37 In relation to paragraph 37, I do not recall this being stated by the owner. 38 In relation to paragraph 38, I make no comment. 39 In relation to paragraph 39, I agree. 40 In relation to paragraph 40, I deny the statement as alleged, and say in reply that I said to the following effect: "We have a contract and work to do, please leave us to get on with our work." 41 In relation to paragraph 41, I agree the owner called the police, I disagree that with the alleged conversation and say in reply that I said to the following effect that: "We have a contact and work to do, please leave us to get on with our work, your breaching the contract and you can't behave like this." 42 In relation to paragraph 42, I make no comment. 43 In relation to paragraph 43, I make no comment, other than that I had a doctor's appointment to attend to that morning. 44 In relation to paragraph 44, I make no comment. … 119 In relation to paragraph 119, I agree we had a meeting on that date at the neighbour's house opposite the owner's house. I do not recall the list of documents being provided to either myself or my solicitor, Mr. Wilkinson as the Owner suggests. I also do not recall Mr Wilkinson providing an undertaking that he would ensure that I would provide all the documents or do the things she has referred to at paragraphs 119(a) to (g) of her affidavit. I say this because it was the 17th of December 2018, and the Christmas shutdown was due to start on Friday 21st December 2018, and the completion of the items the owner has listed at paragraph 119(a) to 119 (g) would be contingent on the suppliers and sub-contractors availability to provide goods and services required to complete the works, and their time frames required to do this, which given the impending Christmas shut down was an issue and could never be achieved. I recall stating to the owner at this meeting to the following effect that: I said: Nerida, "I will have to speak to the suppliers and sub-contractors about when they will able to provide the materials we need, because they are all about to shut down for Christmas and I don't know when they will be back to work, and when they will be able to provide the goods and services we need. It's simply out of my control because of the Christmas shutdown." 120 In relation to paragraph 120. I do not recall Mr. Wilkinson stating this to the owner at this meeting. 121 In relation to paragraph 121, I say that I do not recall Mr. Wilkinson providing an undertaking as suggested by the owner, and in relation to the telephone call, the owner left me a message on my phone sometime later that night after the meeting and I telephoned her back and a conversation to the following effect took place: Nerida said: "Hi Tony, I promise I won't micro-manage the job, I'll leave you to run it and I won't keep coming onto the site. I'll just let you finish the works." I said: "Thankyou Nerida I really appreciate it." Nerida said: "I can leave the keys in the letter box for you to access the site again in the morning." I said: "Ok, that would be good, the trades have all finished up on site for now, and everyone has finished for the year, but we will come to site tomorrow, collect the keys and make sure everything is secure." The oral evidence of the builder 1. The builder gave the following oral evidence: 1. Mr Greg Tengstrom (Mr Tengstrom) was the site supervisor, and there was nothing preventing him from giving a statement (Tcpt, 21 May 2021, p 39(42)-(47)); 2. when the owner attended the site on 14 December 2018 he was doing the batons (Tcpt, 21 May 2021, p 81(18)-(24)); 3. at 14 December 2018 the 16mm boards were on the site and that the only boards that were delivered to the site were 16mm (Tcpt, 21 May 2021, p 82(30)-(41)); 4. he denied losing his temper and saying to the owner "that she'd never get to move into her house and (he was) going to smash it all down", and agreed he said to the owner "If you were a man I would punch you in the face" after she yelled obscenities at him (Tcpt, 21 May 2021, pp 83(25)-84(5)). The oral evidence of the owner 1. The owner gave the following evidence: 1. she accepted that the builder possibly said the words firstly attributed to him in the first Lucien affidavit at [36]; 2. she denied that she said the words attributed to her and the builder said the words secondly attributed to him in the first Lucien affidavit at [36]. The submissions 1. In the owner's 19 July 2021 submissions and her oral submissions the owner makes the following submissions: 1. the Tribunal would prefer her evidence; 2. by his conduct on 14 December 2018 of threatening to deprive her of the benefit of the contract and threatening her person and her property, the builder repudiated the contract; 3. on 14 December 2018, she elected to affirm the contract. This election did not result in a new contract arising. 1. In the builder's 16 July 2021 submissions, the builder's 20 August 2021 submissions and his oral submissions the builder makes the following submissions: 1. on 14 December 2018, the owner wrongfully suspended the works; 2. on 18 December 2018, the owner affirmed the contract; 3. the owner's wrongful suspension of the works on 14 December 2018 made time at large under the contract after this date, relying on DCT Projects Pty Ltd v Champion Homes Sales Pty Ltd [2016] NSWCA 117 (DCT Projects) at [44]. Consideration 1. Having regard to the 16 December 2018 at 4.53pm email, I prefer the account of the owner as to the events that occurred on 14 December 2018. There was no contemporaneous evidence which supports the builder's account of these events. 2. I am not satisfied that the builder by his threats repudiated the contract. The threatening words of the builder occurred in the context of a heated argument between the owner and the builder. While the owner had been entitled to be on the site pursuant to cl 19 of the general conditions, she had no entitlement to issue any directions as to how the works were performed as set out in the first Mullally affidavit at [36], particularly in circumstances where she had not approved variation # 10. While I accept that "(t)he discussion escalated into an argument", the evidence is silent as to what words were said and by whom. It was the police who directed Mr Tengstrom and Mr Archer to leave the property. It appears from the 16 December 2018 at 4.53pm email that this direction was given shortly after 8.12am on 14 December 2018. 3. It appears from the 16 December 2018 at 4.53pm email that the locks to the house on the site were changed at the request of the owner at 5.45pm on 14 December 2018. The changing of locks did not constitute a termination or purported termination of the contract by the owner as she in the 16 December 2018 at 4.53pm email indicated her willingness to meet with the builder to discuss the possible resumption of the works. 4. The builder never refused to perform any further work under the contract on 14 December 2018. It follows that the agreement reached between the parties on 17 December 2018 which is recorded in the 18 December 2018 at 2.24pm email was not an affirmation of the contract by the owner following a breach by the builder, but their mutual acceptance that they continued to be bound by the contract. 5. If, contrary to my finding in [67] above, the builder by his threats repudiated the contract, then the contract was never terminated because the owner affirmed the contract in her conversation with the builder on 17 December 2018 which is referred to in the 18 December 2018 at 2.24pm email. 6. It is unnecessary to determine whether the direction of the police for Mr Tengstrom and Mr Archer to leave the property on 14 December 2018 constituted an "other matter, cause or thing beyond the control of the contractor" within the meaning of that expression in cl 7 of the general conditions entitling the builder to an extension of time under cl 7 because the builder did not seek an extension of time within 10 business days of 14 December 2018 as specified in cl 7. 7. The changing of the locks by the owner on 14 December 2018 did not entitle the builder to an extension of time under in cl 7 of the general conditions because the builder did not suspend work in accordance with cl 24 of the general conditions on the ground of being denied access to the site so as to prevent the work from proceeding. 8. I am not satisfied that the concession in DCT Projects at [44] that the previous delays were not to be taken into account arising out of the parties entry into a modification agreement affirming the contract between them has any application in the circumstances of the events of 14 December 2018 and their aftermath. As found in [69] above, there was no affirmation of the contract. Further, as will be seen the parties proceeded on the basis that the provisions of the contract dealing with the time of completion of the works remained binding on them. Whether the builder failed to proceed with the works diligently in breach of the contract as at 5 April 2019 Introduction 1. The owner's claim that the builder failed to proceed with the works diligently in breach of cl 6 of the general conditions as set out in the 5 April 2019 notice is based on the following four circumstances: 1. the extended time for completion was 11 December 2018, but the works were not complete as at 5 April 2020; 2. the builder failed to notify the owner of the causes and estimated lengths of any delays within the specified time so as to comply with the requirements for extension of time claims under cl 7 of the general conditions; 3. the builder had been sporadically carrying out the works since January 2019 In a piece-meal fashion; 4. the builder had failed to communicate directly with the owner since 21 February 2019, insisting that all communication be through the builder's solicitor, and this had caused further delays to the works. 1. In the course of the hearing the focus was on the delay by the builder from 11 December 2018 as constituting a breach of cl 6 of the general conditions. 2. The builder in the 14 variations submitted to the owner which have been accepted or are in dispute (variations # 12 and # 16 are not being pressed by the builder) specified the following number of days for delay resulting from the variation: 1. variations # 1 dated 21 May 2018, # 2 dated 28 June 2018, # 4 and # 5 dated 9 August 2018, # 6 and # 7 dated 9 August 2018, # 9 dated 12 September 2018, and # 11 dated 22 January 2019: 0 days; 2. variation # 10 dated 19 December 2018: 1 day; 3. variations # 8 dated 12 September 2018, and # 13 and # 15 dated 19 March 2019: 2 days; 4. variation # 14 dated 19 March 2019: 7 days. 1. Before considering this issue, I have set out the applicable legal principles, and summarised the evidence and submissions of the parties. The applicable legal principles 1. In Hometeam Constructions Pty Limited v McCauley [2005] NSWCA 303 (Hometeam) at [169]-[199] McColl JA discussed the failure to proceed with reasonable diligence in a building contract: "[169] It might be accepted that the appellant's failure to complete the Works by the date for practical completion might be some evidence of delay (see Westminster Corporation v J Jarvis & Sons Ltd and Another [1970] 1 WLR 637 at 643 per Lord Hodson, at 645 per Viscount Dilhorne). However, whether delay is of itself sufficient to raise an inference of lack of due diligence must depend on the circumstances. [170] Despite the prevalence of clauses in building contracts requiring the work to be performed with "due diligence", defining the nature of that obligation has proven elusive. [171] In Re Stewardson Stubbs & Collett Pty Ltd & Bankstown Municipal Council, Moffitt J observed (at 1675–1676) that: … [T]he question of what precisely constitutes a failure to proceed with reasonable diligence is a matter of some difficulty. However, it is an allegation of a general failure to proceed with that degree of promptness and efficiency that one would expect of a reasonable builder who has undertaken a building project in accordance with the terms of the contract in question. … [173] In Hooker Constructions Pty Ltd v Chris's Engineering Co [1970] ALR 821 at 822–823, Blackburn J considered whether a head contractor had validly terminated a building sub-contract on the basis that the sub-contractor had failed "to proceed with the works with reasonable diligence" as required by the contract. After observing that the "onus is on the plaintiff to show the [sub-contractor] was in default in a way … caught by this provision", his Honour said (at 822) that he had "not found it easy to construe this phrase 'reasonable diligence' in the context of this case". He concluded that "a sensible construction of the phrase is that the actual extent of work completed is of some significance" and that " 'diligence' in the contract means … not only the personal industriousness of the defendant, but his efficiency and that of all who worked for him". [174] He also said (at 823) that he was entitled to accept as evidence that the defendant had not displayed reasonable diligence, "evidence that the work was, at the material time, seriously incomplete together with evidence that there were no circumstances preventing the defendant from overcoming this situation". [175] In Hooker the plaintiff led evidence that at the time it purported to terminate the sub-contract, the defendant's work was "seriously behind what could reasonably be expected [and] that the situation was not due to anything which was beyond the defendant's control". Although the defendant adduced evidence to show that "through no fault of his own, he was unable to get the necessary material to bring the work to the stage where it should have been at the material time", this did not convince Blackburn J who held the plaintiff had proved the contract was validly terminated. … [178] There were, in my view, in the context of the Contract, at least two ways the respondent could have established that the appellant had failed to perform the works with due diligence. [179] First she could have proved: (a) the work the appellant was required to carry out under the Contract; as events transpired this included the original contract works and the rectification work; (b) what, in addition to the contract period, was a reasonable time within which the appellant ought to have executed the original contract works and the rectification work; (c) that the appellant had failed to execute the work within that reasonable time; (d) that, to the extent the appellant proffered explanations of why the work had not been executed within that reasonable time, those explanations were unacceptable. [180] As I shall explain, the appellant's case was, essentially, that this was the way the respondent was required to prove her case and that she had failed to do so. [181] Secondly, in my view, the respondent was also entitled to seek to prove lack of due diligence by establishing a case of delay in progress during construction. This appears from both Stubbs and Hooker. On this basis she could have established a failure to carry out a reasonable amount of work by a given time; that that period of time be measured by reference to all the work to be performed under the Contract or, in absolute terms, by reference to a lack of activity on site over a significant period that could not be satisfactorily explained. The onus of proving lack of due diligence was on the respondent. If the facts established by the respondent are capable of giving rise to an inference of lack of due diligence, the appellant may discharge any evidentiary onus that may pass to it, by explaining why the work progressed at that rate: see Hobbs. That evidence should be "sufficient … to turn the scale": Brady v Group Lotus Car Cos plc [1987] 3 All ER 1050 at 1059 (CA) per Mustill LJ. … [194] In my view the appellant's failure to seek a formal extension of time in a case where the issue is whether it performed the Works with due diligence cannot be determinative. The fact that the appellant, through administrative neglect but not neglect in carrying out the work, fails to make proper claims for variations does not affect the enquiry, whether, in actually performing the work, due diligence was shown. … [197] Once it was accepted, as Her Honour found (see judgment at [237], [242]) that the rectification work constituted an agreed variation (and therefore founded an entitlement to an extension of time), the question whether the appellant performed the Works with due diligence had to take into account the period reasonably taken by the rectification work. … [199] Accordingly in order to establish that the Works, including the rectification work, had not been performed with due diligence, it was incumbent on the respondent, in my view, to call evidence of the nature of that called in Hooker to establish that at the time the Notice of Default was served, the Works were seriously incomplete and there were no circumstances preventing the appellant from having performed the Works at a more rapid rate." The evidence 1. The evidence relevant to this issue is set out in the applicable contractual terms and correspondence between the parties, the first Mullally affidavit, the Lucien witness statement, the first Lucien affidavit, the second Jamieson report. The applicable contractual terms 1. Clause 6 of the general conditions relevantly provided: "Time for completion The contractor must diligently proceed and complete the work within 36 calendar weeks from the date the work is due to commence as referred to in Clause 5. The period of time allowed for completion has taken into account any public holidays and other days when it is known that work will not be performed. The time for completion may be subject to amendment in accordance with Clause 7." 1. Clause 7 of the general conditions relevantly provided: "Extension of time If the work is delayed by: • inclement weather or conditions resulting from inclement weather … • any act or omission of the owner … • the unavailability of materials necessary for the continuation of the work, unless due to the fault of the contractor • a variation to the work … • any other matter, cause or thing beyond the control of the contractor, the contractor will be entitled to a reasonable extension of time to complete the work. Both the contractor and owner (if applicable) must take all reasonable steps to minimise any delay to the work. If the contractor wishes to claim an extension of time, the contractor must notify the owner in writing of the cause and estimated length of the delay within 10 business days of the occurrence of the event or, in the case of a variation, from the date of agreement to the variation. If the owner does not, within a further 10 business days, notify the contractor in writing that the extension of time sought is unreasonable, the completion date for the contract will be extended by the period notified to the owner." 1. Clause 14 of the general conditions relevantly provided: "Time for payments When the contractor gives the owner a written claim for a progress payment or other amount due under the contract, the owner must pay, unless the owner notified the contractor in the manner stated below, the amount of the claim within 5 business days of receipt of the claim (which must not be less than 5 business days). … 1. Clause 16 of the general conditions relevantly provided: "Work done and/or materials supplied by owner … The owner will supply the materials set out below. The cost of these materials is not included in the contract price. The cost of installation by the contractor is included in the contract price. Materials only by owner As stated The owner must diligently carry out the work and supply the materials described above to avoid undue delay to the work under the contract." 1. Clause 27 of the general conditions relevantly provided: "Disputes If the owner or contractor considers that a dispute has arisen in relation to any matter covered by this contract, either during the progress of the work, after completion of the work or after the contract has been terminated, that person must promptly give to the other party written notice of the items of dispute. If the dispute is not resolved informally following such notification, the parties may confer with a mutually agreed third party whose role will be to assist in the resolution of the dispute by mediation or expert appraisal of the work. If the parties do not agree to confer with a third party to assist in the resolution of the dispute, or if the dispute is not resolved following the assistance of such a third party, the owner may notify Fair Trading that a building dispute exists and seek the assistance of Fair Trading to resolve the dispute. Even if a dispute has arisen the parties must, unless acting in accordance with an express provision of this contract, continue to perform their obligations under the contract so that the work is completed satisfactorily within the agreed time." The correspondence between the parties 1. On 13 October 2018 at 1.31pm, Andrea Sedran on behalf of the builder sent an email to the owner (the 13 October 2018 at 1.31pm email) in she: 1. claimed 5 days were lost as a result of errors and inconsistencies in the plans, specifications and changes/variations requested by her; 2. claimed 5 days were lost as a result of variations to the laundry, concrete level changes due to an existing high sewer line which in turn necessitated changes to the plumbing to accommodate these changes, the relocation of floor wastes in ground floor bathroom, first floor bathroom, shower waste and associated pipework connected to these changes, extra storage required in roof space above bedroom, and changes to rafters framing to accommodate ceiling mounted TV; 3. claimed 34 days were lost as a result of the owner deciding to change the window supplier: "The biggest delay has occurred as a resuIt of you deciding to change the window supplier. Our window supplier presented you with a window/ door schedule which was strictly in accordance with the plans and specifications agreed. You however requested changes to the finish of these windows and doors which our window supplier was unable to meet. As a result of this impasse you found a supplier who could meet the changes you requested. We then appointed your preferred supplier to supply and install the windows and doors Our supplier did the final check measure for the windows and doors on the 26/07 /18 and agreed to install these by the 24/08/18. Your preferred supplier completed the installation on the 27/09/18, thus delaying the project by a further 34 days 1. claimed that a total number of 44 days of construction were lost as a result of these issues; 2. attached the revised building schedule; 3. offered to have a meeting "(s)hould you require any further information/explanation with regard to the schedule". 1. On 13 October 2018 at 5.26pm, the owner sent an email to the builder responding to the 13 October 2018 at 1.31pm email in which she: 1. accepted that 5 days were lost as a result of errors and inconsistencies in the plans, specifications and changes/variations requested by her; 2. accepted that 5 days were lost as a result of changes referred to in [82(2)] above; 3. disputed that 34 days were lost as a result of her decision to change the window supplier: "Totally disagree. The window delay was caused by the manufacturer Aneeta, not Lifestyle Glass. Aneeta do the install of ALL their windows, and Iconic would have been subjected to the same delay. Iconic quoted a totally unrealistic install date of 29 days. The delay can only be measured by the final check measure dates. Iconic did the final check measure on 26/07/18 and Lifestyle Glass did their heck measure on on (sic) 01/08/2018. Thus the delay to the project was 7 days." 1. disputed that a total number of 44 days of construction were lost as a result of these issues: "Total of 17 days were lost. In our discussions you quoted 26 weeks to complete the job. In the contract you added a 10 week buffer to allow for these type of contingencies. That is an additional 70 days were added to the completion date. Your calculations show 44 days lost and mine shows 17 days lost, yet the build will not complete on time." 1. asserted that the revised building schedule was incomplete: "The revised schedule appears to be incomplete. Please show the following items on the schedule: • Rendering all external brickwork • Building brick wall (Pearl Lane and 52/54 Pearl St boundary) • Slab work to garage area • Paving courtyard and garage area • Install garage door and pedestrian gate • Installation of Vergola • Installation of motorised blind • You have allowed 3 days for joinery is this wardrobes and bathrooms or is this the kitchen?? • After the kitchen and vanities are installed there is the electrical fit out and plumbing • The final internal job before the final clean should be the painting. • The final clean is not shown on the schedule" 1. advised her availability for a meeting: "I you will able able (sic) to respond to all my queries, I am available to meet with you at 2.30pm on Monday afternoon at Newtown. Please advise if this is suitable. The agenda: • Incomplete revised building schedule • Anticipatory breach of contract, completion due by 7 November 2018 • Roof skylights (please bring Supplier invoice showing spec's of glass used) • Lack of consultation • Air Con positioning • Safety Induction • The stone floor in bathrooms supplied by GMW will be installed at least 4 weeks after measure. The measure is pencilled for 18.10.2018 which means install will be approx 19.11.18 not 05.11.18 as reflected on your timeline • Meeting required with joiner and designer • Safety Induction" 1. On 23 November 2018 at 4.50pm, Sharleen Sleiman (Ms Sleiman) of Granite & Marble Works Pty Ltd (GMW) in an email to the owner stated that the builder had finished the second round of waterproofing on that day and attached an invoice for the tiles. 2. On 4 December 2018 at 12.18pm, the owner sent an email to the builder in which she advised a change in the specification for the garage door. 3. On 20 December 2018 at 7.38am, the builder in an email to the owner (the 20 December 2018 at 7.38am email) attached variation # 10 which included the following details: "Supply & fit new timber battens to concrete slab to suit height for new 16mm oak timber flooring. Supply & fit 12mm plywood sheeting on new battens between existing. Rubbish removal." 1. On 14 January 2019 at 10.35am, the builder in an email to the owner requested confirmation that she wished to proceed with variation # 10. 2. On 14 January 2019 at 11.28am, the owner sent an email to the builder in which she attached a signed copy of variation # 10 whereby she authorised the builder with the works described therein. 3. On 18 January 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the document entitled "owner's notice of default" (the 18 January 2019 notice) in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract, that the Builder is in default under the Contract in that; 1. It is an express term of the Contract that the Builder must diligently proceed and complete the work within 36 calendar weeks from the date the work (was) due to commence as referred to in clause 5; 2. The date referred to in clause 5 of the Contract is 1 March 2018 and therefore the date for completion of the work under the Contract was 8 November 2018; 3. The time for completion of the work under the Contract has expired however the work is not yet complete; 4. The Builder failed to notify the Owner of the causes and estimated lengths of any delays within 10 business days of the occurrence of the delay, in order to comply with the requirements for extension of time claims under clause 7 of the Contract; 5. The Builder has persistently failed or refused to provide the Owner with information in relation to an expected date for completion of work; and 6. The Builder therefore is failing to diligently proceed with the work, (Default). FURTHER, THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract that if the Builder does not remedy the Default within 10 business days of the date of this notice then, without prejudice to the Owner's rights, the Owner may terminate the Contract." 1. On 22 January 2019 at 1.23pm, the builder sent an email to the owner, which was copied to Mr Tengstrom, and in which he requested her to have the electrical appliances she was to supply delivered to the site advised that the joiner had asked to have a meeting with her on Tuesday 29 January 2019 to finalise choice of veneers and colours (the 22 January 2019 at 1.23pm email). 2. On 22 January 2019 at 1.49pm, the builder sent an email to the owner, which was copied to Mr Tengstrom, and in which he requested her to advise on changes to the shower screens recommended by the supplier. 3. On 24 January 2019 at 4.07pm, the owner sent an email to the builder in which she advised her unavailability for a meeting with the joiner on Tuesday 29 January 2019, and availability for such a meeting all day on Wednesday 29 January 2019. 4. On 24 January 2019 at 5.16pm, Ms Sleiman sent an email to the owner, in which she advised pricing for the laying and sealing of the stone for both bathrooms (the 24 January 2019 at 5.16pm email). 5. On 24 January 2019 at 5.29pm, the owner sent an email to the builder in which she advised that she had purchased the door furniture for all internal doors. 6. On 30 January 2019 at 4.18pm, the owner sent an email to the builder in which she advised that she had arranged for the delivery of the exterior tiles and pavers for Monday 4 February 2019, and attached the pattern design she required for the pavers to be laid in the carport area. 7. On 31 January 2019 at 8.32am, the builder sent an email to the owner, in which he forwarded the email Despina Ghattas of Deston Interior Pty Ltd (Deston) sent at 30 January 2019 at 2.01pm setting out the final amendments for the joinery, and requested her to confirm those final amendments. 8. On 31 January 2019 at 2.40pm, the owner sent an email to the builder in which she provided her instructions for the joinery. 9. On 31 January 2019, the builder's lawyers sent a letter to the owner's lawyers claiming an extension of time of 176 days under the contract (the 31 January 2019 letter) in which the builder's lawyers relevantly stated: "We refer to your clients notice of default dated 18 January 2019. We note that the works under this contract have been significantly delayed as a result of your client's actions, including but not limited to the New South Wales Police preventing our client from accessing the site on Friday 14 December 2018, acting under a complaint from your client. Given this occurred at a critical time in the construction program, and the impending Christmas shutdown period which followed, the delays which have flowed as a result of your client's actions have been substantial. Despite our client's efforts to co-ordinate the trades who had been organised to complete works on 14 December 2018, and thereafter before Christmas 2018, our client has had difficulty in confirming dates with the kitchen joiner, and subsequent trades to complete those aspects of the works, due to their other commitments and the Christmas shutdown period, resulting in at least We further note that the kitchen joiner required instructions from your client, which were only provided to it on 31 January 2019, but sought at a meeting cancelled by your client on 7 December 2018, which has resulted in 44 business days of delay of its self In short, your client for the above-mentioned reasons has significantly delayed this project, due to her own actions, and any alleged default by our client is factually incorrect and if your client elects to terminate the contract she does so at her own peril and in substantial breach of the contract for which our client reserves all of its rights to loss and damages it has and will suffer. EXTENSIONS OF TIME Our client hereby claims 176 business days of delay to the contract for the reasons set out below. We note that our client's extensions of time claimed to date and the revised date for practical completion is, but is not limited to as set out below: [Table in the same terms as "Delay No" 1 to 13 the table in the 8 April 2019 letter at [201] below other than the final 2 rows which states that the total is 176 business days claimed and the revised date for practical completion is 23 July 2019] Pursuant to clause 6 of the contract our client claims an extension of time as previously notified from and as set out above from 9 November 2018 until 23 July 2019. Given the above our client anticipates that a revised date for practical completion of the work will be on 23 July 2019, noting that your clients home will be reasonably capable of being used, in accordance with clause 8 of the contract before that date due to our client's diligent work." 1. On 3 February 2019 at 9.02pm, the owner sent an email to the builder in which she inquired as to the possibility of changing the profile of the back gate (the 3 February 2019 at 9.02pm email). 2. On 7 February 2019 at 4.02am, the owner sent an email to the builder in which she requested confirmation of specified details for the installation of the shower screens that had been discussed at a site meeting on Wednesday 6 February 2019 (the 7 February 2019 at 4.02am email). 3. On 7 February 2019, the owner's lawyers sent a letter to the builder's lawyers responding to the 31 January 2019 letter (the 7 February 2019 letter) in which: 1. the owner's lawyers relevantly stated: Demand We are instructed to make a demand on your client for: … B. The works to be completed expeditiously and without further delay, noting that the extension of time claims made by your client under cover of your letter dated 31 January 2019 entitled "OWNERS NOTICE OF DEFAULT" are unfounded and without any contractual or logical basis." 1. was enclosed the document entitled "owner's notice disputing builder's claim for extension of time" in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 7 of the Contract that the Owner disputes the Builder's claim for extensions of time to complete the works under the Contract as outlined in the letter from Wilkinson Building & Construction Lawyers Pty Ltd dated 31 January 2019, on the following grounds: [Table in the same terms as "Delay No" 1 to 10 the table in the 11 April 2019 notice at [203] below other than the final row which states that the total is 176 business days claimed and 24 days agreed] Further to the above, the Owner gives notice that: A. The Builder failed to notify the Owner of its extension of time claims within 10 business days pursuant to clause 7 of the Contract; therefore, even if the Builder's extension of time claims dated 31 January 2019 were substantiated (which is denied) any extension of claims arising out of events occurring before 16 January 2019 are invalid. B. Some of the delays alleged by the Builder are concurrent delays. For the Builder to simply add up the number of days the works were allegedly delayed by, after various events occurred, is without contractual basis and results in an untenable position of the Builder. C. The date for practical completion in the Contract is 7 November 2018. With an extension of time of 24 business days as accepted by the Owner the works under the Contract were due to be completed by 11 December 2018. D. The Builder's claim for extensions of time until 23 July 2019 is strenuously rejected by the Owner and held to be wholly unsubstantiated. The Owner requires the Builder to proceed with the works under the Contract with due diligence and without further delay. E. The Owner reserves her rights in respect of claiming delay damages from the Builder, including loss of rent arising from an inability to lease the dwelling until the Builder's works are complete." 1. On 11 February 2019, the builder's lawyers sent a letter to the owner's lawyers responding to the 7 February 2019 letter in which they relevantly stated: "We are also instructed that the tiling and flooring works the subject of progress claim number 7, have been substantially completed, save for carpet laying and installation ("PC Item") which our client is still waiting for your client's written instructions as to: • Which carpet she has selected; and • Who the carpet supplier is, so that arrangements between our client and that carpet supplier can commence for the installation of the carpet? Alternatively The alternative is for your client to arrange for that aspect of the works be done herself, and a negative variation is raised for it to be deleted from the contract scope of works and price in the amount of $5,400.00 (inc GST), (being 45 square metres of carpet x $120.00 per square metre as contemplated by the contract). Secondly, the oiling of the timber floors, which cannot be completed until all other works are finished, to ensure the best possible finish to the floors, can also be deleted from the contract to and performed by your client directly. A negative variation can be raised for $180.00, (being 2 hours @ $90.00 per hour) for that work to be completed. Thirdly, our client is prepared to let your client complete the laundry splashback, and raise another negative variation for these works as follows: $240.00 (Tiler 3 hours labour @ $80.00 per hour). The delay to the splashback was caused by your client's failure to make a timely decision about the colour and finish of these cabinets, the suspension of works on 14 December 2018, in breach of clause 19 of the contract, and ongoing delays as a result of that suspension and her communicating with the sub-contractor directly, without consulting our client in breach of clause 19 of the contract which provides that: "The owner must not give directions to the contractors employees or sub-contractors" We note that these works are substantially complete, and if not, do not: ''prevent that stage of works from being reasonably capable of being used for its intended purpose." FURTHER EXTENSION OF TIMES Carpet Please be advised that a further extension of time is sought for the carpet from 9 November 2018, until the date of this letter, and continuing due to your client's failure to select and arrange for the carpet to be purchased and installation arranged with our client, with that supplier. Pavers Please also be advised that an extension of time for the pavers is also sought from 9 November 2018, until 8 February 2019, for the delay caused by your client's failure to order the pavers required at the project, which were only delivered to site on Monday 4th February 2019, and completed by our client this week. Tiling Please be advised that an extension of time for the laundry tile splashback is also sought from 14 December 2018, until 9 February 2019, and continuing for the delay caused by your client as set out above." (footnote omitted) 1. On 12 February 2019 at 12.31pm, the owner sent an email to the builder in which she forwarded the 7 February 2019 at 4.02am email and asked him to confirm (the 12 February 2019 at 12.31pm email). 2. On 12 February 2019 at 9.45pm, the owner sent an email to the builder in which she stated that it appeared that his foreman was no longer on site, and referred to work being done on Friday to Wednesday (which presumably refers to 8 and 11 to 13 February 2019). 3. On 13 February 2019 at 7.05am, the owner sent an email to the builder in which she asked what was happening with the kitchen as the joiner had not been back on site since the meeting on 30 January 2019, and whether he had ordered the garage door, and advised that the appliances could be seen from the street (the 13 February 2019 at 7.05am email). 4. On 13 February 2019 at 1.17pm, the owner sent an email to the builder in which she said that no one was on site that day. 5. On 14 February 2019, the owner's lawyers sent a letter to the builder's lawyers (which was incorrectly dated as 7 February 2019) alleging a failure to proceed with due diligence in which they relevantly stated: " … "Failing to proceed with due diligence Our client instructs that despite your client's assertion that he has continued to work at the site, there have been minimal workers on site this week, unsupervised by your client, and the site was left unlocked on Wednesday 13 February 2019 which is clearly not ideal. The site has been unattended yesterday and today. It is our client's position that your client is again in breach of clause 6 of the contract and furthermore, in breach of clause 12(b). … Our client looks forward to the works being finalised and all matters being resolved without further dispute. Our client reserves all her rights." 1. On 18 February 2019 at 5.46pm, the owner sent an email to the builder in which she said that he did not phone her in response to her left message, there were no workers on site that day and it appeared that he had abandoned the work. 2. On 19 February 2019 at 9.10am, the builder sent an email to the owner, which was copied to Mr Wilkinson and in which he stated that that all communication should be conducted through their solicitors, and the site had not been abandoned. 3. On 20 February 2019 at 8.25pm, the owner sent an email to Tony of Deston with the subject "Stone quote", which was copied to the builder, and in which she said she did not know whether the builder intends to complete the build or abandon the build, and that there have been no workers on site since 20 February 2019. 4. On 20 February 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the document entitled "owner's notice of default" (the 20 February 2019 notice) in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract, that the Builder is in default under the Contract in that: 1. The Builder is unable or unwilling to complete the work and has abandoned the work: a. On 8 February 2019 the construction manager removed all tools belonging to the Builder from site; b. On 13 February 2019 no subcontractors or workers were on site and the site was left unlocked; c. From 13 February 2019 there have been no subcontractors or workers on the site; and d. The Builder has failed to attend the site or carry out any works since 13 February 2019. … 3. The Builder is failing to diligently proceed with the work under the Contract: a. The Owner repeats and relies on the assertions at (1)(a)-(1)(d) above; b. Furthermore, the time for completion of the work under the Contract was 8 November 2018 however the work is not yet complete; and c. The Builder failed to notify the Owner of the causes and estimated lengths of any delays within 10 business days of the occurrence of the delay, in order to comply with the requirements for extension of time claims under clause 7 of the Contract, (Defaults). FURTHER, THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract that if the Builder does not remedy the Defaults within 10 business days then, without prejudice to the Owner's rights, the Owner may terminate the Contract." 1. On 21 February 2019 at 9.19am, the builder sent an email to the owner in which he said that as previously advised the site has not been abandoned, and that the site supervisor and a tradesperson had been on the site yesterday. 2. On 21 February 2019 at 10.50am, the owner sent an email to the builder in which she said that she had visited the site after 5.30pm after the end of her shift yesterday, and saw that no work had been done confirming her view that he had abandoned the site. 3. On 21 February 2019 at 1.03pm, the owner sent an email to the builder in which she said that she had inspected the stone bench tops which had been installed that day. 4. On 21 February 2019 at 6.25pm, the owner sent an email with the subject "shower screens" to Mr Wilkinson, which was copied to the builder and in which she referred to the 7 February 2019 at 4.02am email and the 12 February 2019 at 12.31pm email, and advised that as she was unable to confirm the amended specification with the builder he was to revert to the original specification (the 21 February 2019 at 6.25pm email). 5. On 22 February 2019 at 1.03pm, the owner sent an email to the builder in which she forwarded the email she had sent to Danny of City and Suburb and copied to Mr Wilkinson at 22 February 2019 at 10.24am asking questions about LED strips and garden lighting (the 22 February 2019 at 1.03pm email). 6. On 22 February 2019 at 1.12pm, the owner sent an email to the builder in which she forwarded the email she had sent to Dominic Young (Mr Young) of Sydney Tap and Bathroomware (Sydney Tap) and copied to Mr Tengstrom on 22 February 2019 at 12.20pm advising the site was ready for the delivery of all items and providing the telephone number of Mr Tengstrom. 7. On 22 February 2019 at 1.13pm, the owner sent an email to the builder in which she forwarded the email she had sent to Mr Tengstrom and copied to Mr Wilkinson at 22 February 2019 at 12.10pm providing instructions in response to 10 matters referred to in the email of Mr Tengstrom sent to her at 21 February 2019 at 9.59pm including: "I have been in constant contact with lifestyle doors (sic), and they advised that they will come next week. I will let you know the date. Danny sent me an email today and we are sorting the lighting out." 1. On 23 February 2019 at 10.58am, the owner sent an email to the builder and Mr Tengstrom, which was copied to Mr Wilkinson and in which she said that she had found the stacking doors in the light well were unlocked, she paid for the lock to be changed, and the locksmith believed that the lock had been tampered with to keep it in the open position (the 23 February 2019 at 10.58am email). 2. On 26 February 2019 at 9.17pm, the owner sent an email to the builder, Mr Tengstrom and Mr Wilkinson in which she advised that the bath and vanity basin had been delivered to the site yesterday, the contact details of Mr Young to arrange delivery of the remaining items, details of the BBQ and the shower screens, and requested the correct entrance door to be installed so that she could source the correct door locks (the 26 February 2019 at 9.17pm email). 3. On 1 March 2019, the owner's lawyers sent a letter to the builder's lawyers notifying defects (the 1 March 2019 letter) in which they relevantly stated: "We refer to the above matter. … Failing to proceed with due diligence Despite the numerous notices which have been issued by our client, our client instructs there have been minimal workers on site again this week. It remains our client's position that your client continues to be in breach of clauses 6 and 12(b) of the contract. Our client reserves all her rights." 1. On 5 March 2019 at 10.38am, Mr Tengstrom sent an email to the owner which was copied to the builder and in which he requested that she purchase and provide "asap" handles and locks for the front door and rear gate. 2. On 5 March 2019 at 11.19am, Mr Tengstrom sent an email to the owner and the builder and in which he advised the owner that the light well door was still unlocked, and requested to have it fixed "asap as all of PC items will be on site soon". 3. On 5 March 2019 at 11.28am, Mr Tengstrom sent an email to the owner which was copied to the builder and in which he requested that she provide LED light strips as "Danny is planning to be here on Thursday". 4. On 12 March 2019, the builder's lawyers sent a letter to the owner's lawyers claiming an extension of time of 195 days under the contract (the 12 March 2019 letter) in which they relevantly stated: "We refer to previous communications. EXTENSIONS OF TIME Our client hereby claims 195 business days of delay to the contract for the reasons set out below. We note that our client's extensions of time claimed to date and the revised date for practical completion is, but is not limited to as set out below: [Table in the same terms as "Delay No" 1 to 13 the table in the 8 April 2019 letter at [201] below other than the final 2 rows which states that the total is 195 business days claimed and the revised date for practical completion is 28 August 2019] Pursuant to clause 6 of the contract our client claims an extension for the reasons stated above and as notified from 9 November 2018, until 28 August 2019. Given the above our client anticipates that a revised date for practical completion of the work will be on 28 August 2019, noting that your clients home will be reasonably capable of being used, in accordance with clause 8 of the contract before that date due to our client's diligent work. Our client continues to perform its obligations under the contract." 1. On 12 March 2019 at 6.14pm, the owner sent an email to Mr Tengstrom which was copied to the builder and Mr Wilkinson, and in which she confirmed specifications for the shower screens "(a)s per our discussions today". 2. On 15 March 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the document entitled "owner's notice disputing builder's claim for extension of time" in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 7 of the Contract that the Owner disputes the Builder's claim for extensions of time to complete the works under the Contract as outlined in the letter from Wilkinson Building & Construction Lawyers Pty Ltd dated 12 March 2019, on the following grounds: [Table in the same terms as "Delay No" 1 to 13 the table in the 11 April 2019 notice at [203] below other than the final row which states that the total is 176 business days claimed and 24 days agreed] Further to the above, the Owner gives notice that; A. Some of the delays alleged by the Builder are concurrent delays. For the Builder to simply add up the number of days the works were allegedly delayed by, after various events occurred, is without contractual basis and results in an untenable position of the Builder. B. Importantly, the Builder previously issued a claim for extensions of time on 31 January 2019, which contained items (1) to (10) above. The Owner responded to the Builder's claim for extensions of time dated 31 January 2019 by notice served on the Builder on 7 February 2019 and in that response addressed items (1) to (10) above. The Builder has failed to acknowledge that the Builder's previous extension of time claims are without basis and has simply repeated those claims on 12 March 2019. C. The Builder failed to notify the Owner of its extension of time claims within 10 business days pursuant to clause 7 of the Contract; therefore, even if the Builder's extension of time claims dated 31 January 2019 were substantiated (which is denied) any extension of time claims arising out of events occurring before 16 January 2019 are invalid. Similarly, even if the Builder's extension of time claims dated 12 March 2019 were substantiated (which is denied) any extension of time claims arising out of events occurring before 26 February 2019 are invalid. D. Furthermore, the Builder has refused to communicate with the Owner directly since 21 February 2019, which has compounded the delay to the works under the Contract. E. The date for practical completion in the Contract is 7 November 2018. With an extension of time of 24 business days as accepted by the Owner the works under the Contract were due to be completed by 11 December 2018. F. The Builder's claim for extensions of time until 28 August 2019 is strenuously rejected by the Owner and held to be wholly unsubstantiated. The Owner requires the Builder to proceed with the works under the Contraot with due diligence and without further delay. G. The Owners notes that the correspondence from Wilkinson Building & Construction Lawyers dated 26 February 2019 contains an assertion that it is possible for the builder's trades to complete the following items in the next two weeks: i. Painting; ii. Plumbing; iii. Electrical works; iv. Roofing; V. Rendering; vi. Tiling; and vii. Shower screens. As none of these items have been completed in the two-week period ending 13 March 2019 the Owner continues to hold the view that the Builder is failing to proceed diligently with the works. H. The Owner reserves her rights in respect of claiming delay damages from the Builder, including loss of rent arising from an inability to lease the dwelling, and storage costs arising from being unable to furnish the dwelling, since the date for completion under the Contract." 1. On 27 March 2019 at 2.03pm, Mr Tengstrom sent an email to the owner which was copied to the builder and in which he asked when her glazier would be installing glass to the door and natural light window in the front entrance. 2. On 28 March 2019 at 12.39pm, the builder sent an email to the owner which was copied to Mr Tengstrom and in which he advised his allowance for the garage roller door, motor and remotes. 3. On 28 March 2019 at 3.53pm, the owner sent an email to the builder in which she advised that a garage installer had given a quote and was "coming out tomorrow to do a measure and confirm price". 4. On 29 March 2019 at 3.46pm, the owner sent an email to the builder in which she forwarded the email Gary Markham of Deville Garage Doors (Deville) had sent her on 29 March 2019 at 2.53pm attaching a quotation for a garage door and requested him to "contact Deville and give them the OK to proceed". 5. On 1 April 2019 at 11.19am, the owner sent an email to the builder and Mr Wilkinson in which she forwarded the email Phillipa of Deville had sent her on 1 April 2019 at 11.12am thanking her for her order of a garage door. 6. On 4 April 2019 at 10.43am, the owner sent an email to Mr Tengstrom and the builder in which she forwarded the email Mr Young had sent her on 4 April 2019 at 10.37am advising that he had two shower handles in stock and awaiting the supply of an extra bath handle "which I was told about later". 7. On 5 April 2019 at 8.43am, Mr Tengstrom sent an email to the owner and the builder in which he stated that he advised Mr Young of two shower and one bathtub mixers as soon as he knew that they were not delivered, the plumber only needed one day to finish her house, that he would organise the plumber when he has all missing and needed items, and requested her "to get a ETA off Dominic as this adds to the time delays". 8. On 5 April 2019 at 11.25am, the owner sent an email to Mr Tengstrom in which she stated the first she knew about the bathtub mixer was when he advised her yesterday, and disputed these items were adding to time delays: "Also, I don't agree that these items are adding to time delays as we are still waiting for the garage door (3 weeks), joinery (???? Weeks), painting (????? Weeks) etc etc" 1. On 16 April 2019 at 8.37am, Mr Tengstrom sent an email to the owner and the builder in which he requested her to get Sydney Tap to contact her when they received the handle so that he could book in the plumber (the 16 April 2019 at 8.37am email). The first Mullally affidavit 1. In the first Mullally affidavit, the owner gave the following evidence: 1. on or about 27 November 2018 she paid GMW for supply and laying the stone tiles in the bathrooms (at [81]); 2. as at 7 December 2018 there were still substantial works to complete, including but not limited to 30 specified items (at [109]); 3. on 21 February 2019 the stone benchtops were installed in the kitchen (at [126]); 4. a friend who kept her house under observation provided a record to her that the builder was not on the site for 27 days between 18 December 2018 and 27 February 2019, that subcontractors were on site for 4 of these days (11, 12, 21 and 22 February 2019) and the builder cleared all tools from the site on 1 of these days (8 February 2019). There is no record for the period from 14 January 2019 to 7 February 2019 (at [126]); 5. as to the owner's stone floor supplier/installer, the delay was caused by the builder not advising the floor supplier/installer when the waterproofing in the bathrooms would be finalised and booking a laying date. She does not believe that the alleged delay affected the critical path of the works (at [132], [137]); 6. says that as at 24 April 2019 the following 18 items of the works were incomplete (at [186]): 1. the garage door was not fitted; 2. the masonry boundary wall between the property and the adjoining property was not erected; 3. the external venetian blind was not fitted; 4. the recessed handrail for internal stairs was not installed; 5. the doors under stairs were not fitted; 6. the tiling in the laundry was not completed; 7. the shower screens were not installed; 8. the garden lights were not installed; 9. the light well tiling was not completed; 10. the shutters were not installed; 11. the kitchen garbage bin was not installed; 12. the carpet was not laid; 13. the painting was not finished; 14. the final clean had not been done; 15. wallpaper had not been fixed; 16. the rendering of the front façade had not been done; 17. the downstairs toilet had not been installed to the applicable height specifications; 18. the light fitting in the downstairs bedroom had not been installed; 1. on 12 March 2019, Sydney Woodworkers Warehouse issued its tax invoice for the purchase and delivery a front door to the site, which noted that delivery took place on that day (at [192(b)], [193]; 2. as to variation # 13, she relevantly says that: 1. the builder installed the front door on or about 6 April 2019 (at [264]); 2. she requested the builder to add horizontal lines to the rear gate on 5 February 2019, and sent the picture of the rear gate to the site foreman on 5 February 2019, and the gate is defective and requires replacement (at [268], [270]); 1. as to variation # 14, she relevantly says that the builder did not complete the following works included in this variation: 1. the re-positioning of the LED strip light (at [273(a)]); 2. the rear wall behind the laundry basin which was completed at no charge by Deston, the builder's joiner (at [273(b)]); 3. the painting under the stair area (at [273(c)]); 1. as to variation # 15, she relevantly says that the builder did not complete the works included in this variation (at [279]); 2. as to the additional works claimed by the builder, she relevantly: 1. accepts that the fitting of a TV unit in the bedroom was completed by the automation contractor (at [293(a)]); 2. says that the rendering of the neighbour's side of the dividing fence was not completed at her request (at [293(b)]); 3. says that the suspended ceiling on the first floor and the change of the floor batten level on the ground floor was not a variation (at [293(c)]); 4. says that she paid for the change to the floor batten level on the ground floor as part of variation # 10 (at [293(d)]). The second Mullally affidavit 1. In the second Mullally affidavit, the owner gives the following evidence: 1. she says that obtained the rainfall records of the Bureau of Meteorology for Sydney Airport and prepared a summary of the hourly rainfall for the period from 26 February 2018 to 4 June 2018 which identifies 19 days on which there was rain and 12 days on which there was rain between 6.00am and 5.00pm (at [6]); 2. she says that on or about 11 July 2020 she found the site diary of the builder for the period from 1 July 2018 to 16 January 2019 which on 13 January 2019 contains handwritten entries (the 13 January 2019 site diary) (at [7]): 1. the following 14 items with a preceding number for 10 of the items: "0 roof ladder remove 2 2 – driveway vergola 1 2 – plywood floor 8 2 – floor install 6 ½ - install bedroom door 9 1 – install skirtings and architraves 7 ½ - install ceiling TV mount 4 ½ - install mirror dining area 3 2 – install entrance door and glass 10 1 – install strip drains 5 2 – make and install 2 sliding doors and timber work 11 vergola 12 rainwater heads 13 flashings 1. the words " 3 weeks" below the first 11 items, and "4weeks" at the top of the list of 14 items; 2. the following items and times which are grouped beside the words "ext trades": "tiles driveway entry area Shower screen – mon measure Plumbing 3 days Cabinets 2 weeks Paint 2 weeks Render 2 days" The Lucien witness statement 1. in the Lucien witness statement the builder says that: 1. on 8 November 2018, the owner signed and returned variation # 8 (at [31]); 2. on 14 January 2019, the owner returned variation # 10 which she had signed on 20 December 2018 (at [33]); 3. in or around March 2019, the following additional works were requested by and done for the owner (at [38]): 1. the fitting of a TV unit in the bedroom; 2. the rendering of the neighbour's side of the dividing fence; 3. the suspended ceiling on the first floor; 4. the change of the floor batten level on the ground floor. The first Lucien affidavit 1. In the first Lucien affidavit, the builder: 1. in relation to the 30 incomplete items specified by the owner, says that he agrees, and that the owner's own conduct was the cause of 8 of these items being incomplete, and that 4 of these items were variations (at [109]); 2. says that most trades people and suppliers are closed for the first few weeks of January as are the manufacturers of building products (at [128(b)]); 3. says that the kitchen manufacturer was unavailable to supply doors between 7 December 2018 and 21 February 2019 (at [128(b)(ii)]); 4. says that the owner failed to select paint colours between 31 January 2019 and 21 February 2019 (at [128(b)(iii)]); 5. says that delays were caused by the owner's stone floor suppliers and installers (at [128(c)(i)]); 6. says that the bathtub selected by the owner could not fit up the internal stairs and required a specialist company to move it to the first-floor bathroom (at [128(c)(ii)]); 7. says that there was delay in the delivery of the tapware and fittings, and the front door (at [128(c)(iii)], [128(c)(iv)]); 8. as to the 5 April 2019 notice denies that he was failing to diligently proceed with the works (at [179]); 9. as to the 18 items of the works that the owner says were incomplete as at 24 April 2019, says that (at [186]): 1. the owner ordered the garage door on 1 April 2019; 2. the masonry boundary wall between the property and the adjoining property had been erected; 3. he had agreed with the owner that she would purchase and install the external venetian blind; 4. the recessed handrail for the internal stairs was a variation and the design had been finalised; 5. the doors under stairs were not part of the contract scope of works; 6. the design for the tiling in the laundry was changed by the owner and he did not have an opportunity to complete these works before 24 April 2019; 7. the design for the shower screens was changed by the owner and he did not have an opportunity to complete these works before 24 April 2019; 8. the owner had not decided on, and purchased the garden lights she wanted before 24 April 2019; 9. the light well tiling was not part of the contract scope of works; 10. the installation of the shutters was not part of the contract scope of works; 11. the owner was to supply the kitchen garbage this and had not done so before 24 April 2019; 12. he had agreed with the owner that she would purchase and lay the carpet; 13. the painting other than a few touches was finished; 14. the final clean could not be done before 24 April 2019; 15. the fixing of wallpaper was not part of the contract scope of works; 16. the rendering of the front façade was not part of the contract scope of works; 17. the owner's design for the downstairs toilet could not be accomplished; 18. he could not install the light fitting in the downstairs bedroom before it was purchased and delivered by the owner; 1. as to variation #13, he relevantly (at [262], [264], [270]): 1. agrees that he installed the front door on or about 6 April 2019; 2. agrees that the owner requested him to add horizontal lines to the rear gate on 5 February 2019, and sent the picture of the rear gate to the site foreman on 5 February 2019; 3. says that the rear gate was working satisfactorily when the owner took possession of the site; 1. as to variation #14, he relevantly agrees that he did not complete the works specified by the owner as at 24 April 2019 (at [273]); 2. as to variation #15, he relevantly agrees that he did not complete the works included in this variation as at 24 April 2019 (at [279]); 3. as to the additional works he has claimed, he relevantly says that he completed the TV fitting work (at 293(a)]). The second Jamieson report 1. In the second Jamieson report, Mr Jamieson has relevantly expressed opinions: 1. in relation to the value of the works not completed or supplied: $26,963 comprising the following items: 1. works not executed; $9,045; 2. external venetian recessing: $2,110; 3. incorrect insulation to internal walls: $430; 4. storage room doors not installed: $2,442; 5. Items in the 11 July 2017 quote not supplied: $12,936; 1. in relation to the extension of time claims in the 31 January 2019 letter, the 12 March 2019 letter, and the 8 April 2019 letter: 1. EOT Claim 3 - Window & Door Supplier: as the window manufacturer caused the delay rather than the nominated supplier, the delay was not the responsibility of the owner, and the reasonable extension of time for this claim is nil days; 2. EOT Claim 4 - Police Suspension: as the builder did not attend site on 25 days between 17 December 2018 and 27 February 2019, the builder contributed to the delays in this period by failing to diligently progress the works on site and, therefore, an extension of time claim for 48 days is not reasonable. Further, as the events of 14 December 2018 were within the control of the builder, the extension of time claim does not fall within cl 7 of the general conditions. The reasonable extension of time for this claim is nil days; 3. EOT Claim 7 – Kitchen: in light of the alleged circumstances surrounding the purported delay, namely that the owner failed to attend one site meeting, and the concurrent delays for which the builder was responsible, this extension of time claim is not reasonable. The reasonable extension of time for this claim is nil days; 4. EOT Claim 8 - Paint Colours: in light of the alleged circumstances surrounding the purported delay, namely that the paint colours were specified in the contract, and the concurrent delays for which the builder was responsible, this extension of time claim is not reasonable. The reasonable extension of time for this claim is nil days; 5. EOT Claim 9 - Rain Days: without further information as to the days involved, the critical activities delayed by this event and the severity of the inclement weather he is not able to form an opinion on the reasonableness of this extension of time claim; 6. EOT Claim 10 – Stone Floor: the delays to the stone flooring were caused by the builder's coordination of the waterproofing works which was a preceding activity to the stone flooring. The builder had a responsibility to complete the preceding works and to suitably coordinate the stone installation works even although the stone supplier was selected by the owner. As the events causing the delay were within the control of the builder the extension of time claim is not reasonable. The reasonable extension of time for this claim is nil days; 7. EOT Claim 11 – Carry Bathtub Up Stairs: as this event was not beyond the control of the builder by reason that It was his responsibility to install the bath and to coordinate its works to accommodate the sequence of work, and the size of the bath should have been reasonably considered in advance by an experienced builder, the extension of time claim does not fall within cl 7 of the general conditions. The reasonable extension of time for this claim is nil days; 8. EOT Claim 12 – Tapware, Fixtures & Fittings: in light of the alleged circumstances surrounding the purported delay, namely that the builder and his representative failed to act having been given details of the fixtures and fittings required, and the concurrent delays for which the builder was responsible, this extension of time claim is not reasonable. The reasonable extension of time for this claim is nil days; 9. EOT Claim 13 – Front door: without further information as to the critical activities delayed by this event and the dates on which the delay was experienced he is not able to form an opinion on the reasonableness of this extension of time claim; 10. EOT Claim 14 - Garage door: as this event was within the control of the builder by reason that the builder was informed of the garage door selection on 4 December 2018 and that the garage door was part of the contractual scope to be supplied and installed by the builder, the extension of time claim is not reasonable. The reasonable extension of time for this claim is nil days. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner made the following submissions: 1. to proceed diligently implies there is a normal diligence. If that is right, the normal measure of proceeding diligently must be the time allowed for completion under the contract, that is 36 weeks. There may be exceptional circumstances in exceptional cases that make this measure inappropriate, for example, bushfires, cyclones or health orders. But that is not this case. There are no exceptional circumstances in this case; 2. the builder seeks to suggest that the owner caused delay. That is untrue. The owner kept things going by paying for items that the builder should have, but did not, ordered and paid for, such as the Hella blinds and the garage door, and by sourcing alternative contractors when the builder's contractors failed him for some reason or another, for example, the window suppliers; 3. at the time of termination, the builder was 4 months outside the time for completion under the contract. 1. In the owner's 28 July 2021 submissions and her oral submissions the owner made the following submissions: 1. she instructed a change to the garage door profile on 4 December 2018. The builder never ordered the garage door. According to the builder's initial time line, it was to be installed 8 days before completion. There is no indication in the builder's evidence of how or why the change of the garage door profile impacted progress of the work; 2. the builder, by his conduct, caused the delay on 14 and 17 December 2018. The work was not in the final stages of completion at the time. The floor boards had not been laid, skirting boards and architraves needed to be installed, the kitchen cabinetry was still be installed, plasterboard installation was underway, the Vergola had not been installed, the roofing was incomplete, the paving of the rear yard was not done, and the various other items as listed in the 13 January 2019 site diary remained to be done. There is no evidence from any of the trades of being unable to return to the job when required; 3. the electrical appliances were requested by the builder in the 22 January 2019 at 1.23pm email on the basis that the joiner needed the appliances on site. The stone benchtops were installed in the kitchen on 21 February 2019; 4. the builder's 16 July 2021 submissions do not suggest the amendment to the kitchen and details of paver design delayed the progress of the works; 5. the builder's 16 July 2021 submissions do not suggest changes to the shower screens recommended by the supplier delayed the progress of the works. There is no response in evidence made by the builder to the 7 February 2019 at 4.02am email, the 12 February 2019 at 12.31pm email and the 21 February 2019 at 6.25pm email in relation to the shower screens; 6. the absence of communication from the builder from 6 February 2019 shows that the builder had disengaged and left it to the owner to deal with Mr Tengstrom and the subcontractors; 7. there is no response in evidence made by the builder to the 22 February 2019 at 1.03pm email regarding her questions about LED strips and garden lighting; 8. there is no response in evidence made by the builder to the 23 February 2019 at 10.58am email regarding the unlocked stacking doors in the light well; 9. there is no response in evidence made by the builder to the 26 February 2019 at 9.17pm email regarding delivery of the bath and vanity basin and remaining items of bathware, the BBQ, the shower screens, and the entrance door; 10. there is no response in evidence made by the builder to the 13 February 2019 at 7.05am email regarding the garage door; 11. the delay in the supply of bathware did not cause delay in the progress of the works because of the time it would take to complete other work, including the garage door, joinery and painting; 12. by April 2019, the builder was 4 months past the extended completion date and anticipated further delay until December 2019. Relying on Hometeam at [181], an evidentiary onus shifts to the builder. In the absence of any reasonable explanation for his dilatory progress, the Tribunal would find that the builder was not proceeding diligently with the works. The submissions of the builder 1. In the builder's 16 July 2021 submissions and his oral submissions the builder made the following submissions: 1. the builder continued to diligently bring the building works to finality, however, was hindered at every turn by the owner's erratic behaviour and regular changes to the specifications of final finishes which were periodically unavailable to the builder and constrained what could be done on the site; 2. he relies on the events between 4 December 2018 and 24 April 2019 which are set out chronologically. 1. In the builder's 20 August 2021 submissions and his oral submissions the builder submitted that the owner materially contributed to any delay in circumstances where she contributed significantly to the builder's inability to complete the works within 36 weeks, noting that: 1. the owner had instructed numerous variations under the contract, which delayed the works; 2. the owner conceded 24 days of extensions of time to the builder; 3. the owner then instructed the builder to proceed with variation # 10 requested by the builder on 19 December 2018, but only approved and communicated her approval of that variation on 14 January 2019, some 25 days later; 4. in breach of cl 16 of the general conditions the owner failed to diligently provide the materials she was required to provide under the contract to avoid undue delay to the work under the contract, namely electrical appliances, stone, door furniture, pavers, tapware, LED lights, the front door, handles and locks for the door and gate, shower screen specifications, LED light strips, the glass to the door and natural light window; 5. the owner's failures to pay the builder's progress payment claims on time, in accordance with cl 14 of the general conditions. Consideration 1. It is common ground between the builder and the owner that none of the variations which remain in dispute were submitted within the time frame specified in cl 7 of the general conditions. 2. The builder in view of not pressing variation # 16 no longer claims an extension of time of 110 days relating to this variation as specified in delay no 14 of the table in the 8 April 2019 letter. 3. I am satisfied that the list of incomplete works of the owner as a 7 December 2018 and 24 April 2019 set out in the first Mullally affidavit is accurate. By comparing the owner's list of items which were incomplete as at 7 December 2018 and 24 April 2019, it can be inferred that builder completed he following items after 7 December 2018: 1. erecting and rendering the masonry rear boundary fence; 2. installing a pedestrian gate in the rear boundary fence; 3. rendering the existing masonry boundary wall between the property and the adjoining property; 4. tiling the rear yard; 5. supplying power to the rear boundary wall; 6. supplying and installing a Vergola louvre roof over the courtyard; 7. supplying and installing the internal staircase; 8. supplying and installing an external mirror and an internal wall mirror; 9. installing the ground floor timber flooring; 10. supplying and installing the entertainment unit joinery; 11. supplying and installing the kitchen cabinetry; 12. supplying and installing the master bedroom wardrobe and the second bedroom walk in wardrobe; 13. laying the first floor bathroom wall tiles and stone tile floor; 14. laying the ground floor bathroom wall tiles and stone tile floor; 15. installing Center S1 Screens on the bi-fold doors; 16. re-planting the front yard; 17. installing the bath and taps in the bathroom. 1. I am satisfied that variations # 1 to # 11 and #13 to # 15 contain an accurate estimate of the number of days delay that will be occasioned by the carrying out of the works in the variation. 2. I am satisfied that the 13 January 2019 site diary is an accurate record of the work remaining to be done under the contract as at that date. It records four weeks work remaining to be done by the builder and his employees, and five weeks work remaining to be done by external trades. 3. I am satisfied that the extension of time claims in the 31 January 2019 letter, the 12 March 2019 letter, and the 8 April 2019 letter are not justified except to the extent accepted Mr Jamieson in the second Jamieson report. The builder adduced no expert evidence to contradict the opinions of Mr Jamieson. Further, the builder adduced no evidence to demonstrate that the various reasons for delay for which an extension of time is claimed affected the critical path for the performance of the works. 4. I am not satisfied that the original contract works and the variation works were seriously incomplete as at 5 April 2019. The opinion Mr Jamieson in the second Jamieson report that the value of the works not completed or supplied is $26,963.00 in circumstances where the original contract price is $812,770.00 does not demonstrates serious incompletion, but on the contrary substantial completion. 5. I am satisfied that the owner has established that the builder failed to proceed with the works diligently in breach of the contract as at 5 April 2019 by reference to the principles in Hometeam at [179] for the following reasons: 1. the work the builder was required to carry out under the contract was the contract works together with works in variations # 1, # 2, # 4 to # 11, and # 13 to # 15; 2. a reasonable time within which the builder ought to have executed the original contract works and the variation works, taking into account the delay in the communication of the approval of variation # 10 by the owner until 25 January 2019 and making an assumption in favour of the builder that variations # 11 and # 13 to # 15 are justified and occasioned an additional 10 days' work, was 9 February 2019; 3. the builder failed to execute the original contract works and the variation works within that reasonable time; 4. the explanations of the builder of why the original contract works and the variation works had not been executed within that reasonable time are unacceptable because the absence of evidence to demonstrate that the various reasons for delay for which an extension of time is claimed affected the critical path for the performance of the works. 1. I am also satisfied that the owner has established that the builder failed to proceed with the works diligently in breach of the contract as at 5 April 2019 by reference to the principles in Hometeam at [181]-[199] for the following reasons: 1. the evidence including the correspondence between the parties demonstrates a lack of activity on site over a significant period from 18 December 2018 to 5 April 2019 that is not satisfactorily explained; 2. the builder did not discharge the evidentiary onus that passed to him by satisfactorily explaining the reasons for delay. In particular, the builder failed adduced any evidence to demonstrate that the various reasons for delay for which an extension of time is claimed affected the critical path for the performance of the works. Further, the builder failed adduced any evidence by Mr Tengstrom or any subcontractor explaining why the works could not proceed with that degree of promptness and efficiency that one would expect of a reasonable builder. 1. I am further satisfied that the owner by each of the 18 January 2019 notice and the 20 February 2019 notice gave notice to the builder of a dispute as to whether he was diligently proceed with the contract, and that each of these notices was an effective notice for the purpose of the first paragraph of cl 27 of the general conditions of this dispute. Whether the builder failed to remedy defective work or remove faulty or unsuitable materials in breach of the contract as at 5 April 2019 Introduction 1. This issue involves consideration of the following questions: 1. whether any of the items identified by the owner were defective; 2. whether the builder was required to remedy any such defective work before as at 5 April 2019. 1. Before considering this issue, I have summarised the evidence and submissions of the parties. The evidence 1. The evidence relevant to this issue is set out in the applicable contractual terms and correspondence between the parties, the first Lucien affidavit, the oral evidence of the builder, and the joint building report. The applicable contractual terms 1. Clause 3 of the general conditions relevantly provided: "General conditions of contract It is agreed, subject to this and the other clauses of this contract, that: (a) the contractor will: • comply with the statutory warranties in section 18B of the Home Building Act 1989 and complete the work in accordance with the requirements of this contract; and …" 1. Clause 8 of the general conditions provided: "Completion of work The work will be complete when the contractor has finished the work in accordance with the contract documents and any variations, there are no omissions or defects that prevent the work from being reasonably capable of being used for its intended purpose, any damage of the kind referred to in Clause 19 has been repaired, and all rubbish and surplus material has been removed from the site. When the contractor believes the work is complete, the contractor must notify the owner in writing certifying that the work has been completed in accordance with this contract. Within 10 business days of receipt of written notice from the contractor, the owner must advise the contractor in writing of any items of work the owner considers to be incomplete or defective. If the owner does not so notify the contractor, the work will be taken to be complete. The contractor must complete any outstanding work promptly and again notify the owner in writing. Unless the owner notifies the contractor in writing that any item is still incomplete or defective within a further 10 business days from receipt of notification by the contractor, the work will be taken to be complete. Should there be any dispute between the parties as to whether the work has been completed, it must be dealt with in accordance with the dispute resolution procedure (Clause 27)." 1. Clause 9 of the general conditions relevantly provided: "Statutory warranties The contractor warrants that: (a) the work will be done with due care and skill and in accordance with the plans and specifications set out in the contract … 1. Clause 20 of the general conditions relevantly provided: "Identifying the site The contractor is responsible to ensure that the work is carried out on the owner's land. …" 1. Clause 23 of the general conditions relevantly provided: "Defects rectification The contractor must rectify omissions and defects in the work which become apparent within the period of 13 weeks from the date the work has been completed. The date of completion shall be determined in accordance with Clause 8. The owner must notify the contractor in writing of any omissions or defects which need to be made good no later than 10 business days after the expiry of the 13 week period. The contractor must rectify the omissions and defects at the contractor's own cost within 30 business days from receipt of such notification and the owner must give the contractor reasonable access for this purpose. In respect of major omissions and defects in the work, a further defects liability period of 13 weeks from the date the work has been completed will apply. If there is a dispute between the parties as to whether any item of work is defective, has been omitted or has been satisfactorily rectified the dispute must be dealt with in accordance with the dispute resolution clause (Clause 27)." 1. The general conditions contain notes, explanations and warnings, and relevantly provided: "Notes, Explanations and Warnings The notes, explanations and warnings that follow do not form part of the contract." 1. The explanation to cl 23 of the general conditions relevantly provided: "After the work has been completed omissions and defects may become apparent. … It is not intended that the defects rectification period be used to finish items of work which should have been completed to achieve completion of the work in accordance with Clause 8." 1. The contract relevantly specifies the following requirements: 1. as to insulation, the requirements are set out in the 1 March 2019 letter at [170] below; 2. as to the bathroom ceilings, the owner specifications specify "Aquachek 13mm"; 3. as to the shower screen installation, drawing AKD-001 of the AK specifications includes the following notation for the bathroom on the ground floor: "floor to ceiling shower screen fin [recessed]"; The correspondence between the parties 1. In the 1 March 2019 letter the owner's lawyers relevantly stated: "We refer to the above matter. We are instructed to notify your client of the following defects in the works carried out by your client at the site; … External paving The fall of the external paving in the carport area is predominantly towards the planter box along the boundary wall whereas the fall should be towards Pearl Lane. Our client's consultant has confirmed the fall is not in accordance with the contract. Furthermore, the consultant has raised concerns in relation to the planter box, as it appears to be servicing the water runoff from the carport. In particular, the concerns are In relation to how the planter box will drain and not flood, including how the planter box will be waterproofed to prevent moisture damage to external finishes i.e. cement render and paint finishes. We are instructed that as the fall is quite pronounced, the paving looks sloped to the eye. On the opposite wall to the boundary planter box, the paving is higher than the courtyard retaining wall. Our client requires rectification of the fall so that it is in accordance with the design in the contract. Insulation We are instructed the insulation has not been installed in accordance with the contract documents: 1. BASIX: a. The BASIX Report Specifications specify a foil backed blanket of 75mm. b. The builder has installed a product which is 55mm. c. As such, the builder has not complied with the BASIX specifications. 2. ACOUSTIC REPORT: a. The acoustic report contains two options: i. Option 1 - • Metal deck roof; and • One layer of 19 mm thick particleboard or 9 mm thick fibre cement laid below; and • Minimum 50 mm thick glasswool insulation (min density 10 kg/m3) with vapour barrier such as Anticon roofing blanket installed between the metal deck roof and the particleboard/fibre cement; and • Minimum 90 mm thick glasswool insulation (min density 10 kg/m3) such as CSR Bradford Gold Batts R2.0 or equivalent installed inside the roof cavity between the ceiling joists or rafters; and • One layer of 13 mm thick sound-rated or fire-rated plasterboard for the ceiling in Bedrooms 2 and 3. One layer of standard 13 mm thick plasterboard is sufficient over other areas; and • Minimum airgap of 200 mm between the particleboard and the ceiling (the insulation recommended above is installed inside the airgap). b. The builder did not install "one layer of 19 mm thick particleboard or 9 mm thick fibre cement laid below". c. As such, the builder has not complied with Option 1 of the acoustic report specifications. i. Option 2 - • Metal deck roof with Heavy Duty Barking vapour barrier; and • Minimum 90 mm thick glasswool insulation (min density 10 kg/m3) such as CSR Bradford Gold Batts R2.0 or equivalent installed inside the roof cavity between the ceiling joists or rafters; and • Two layers of 13 mm thick sound-rated or fire-rated plasterboard for the ceiling in Bedrooms 2 and 3. One layer of 13 mm thick sound-rated or fire-rated plasterboard is sufficient over other areas; and • Minimum airgap of 200 mm between the metal deck roof and the ceiling (the insulation recommended above is installed inside the airgap). d. The builder did not install a "Heavy Duty Barking vapour barrier". e. As such, the builder has not complied with Option 2 of the acoustic report specifications. f. Our client is unaware if two layers of plasterboard has been installed in Bedrooms 2 and 3 or not. 3. CONTRACTUAL SPECIFICATION: a. The specification in the contract specifies: • Metal Deck Roof • Bradford Heavy Duty Anticoni 30 • 19mm particleboard • Bradford Soundscreen R3.1 • 13mm Gyprock Soundchek b. The builder did not install Bradford Heavy Duty Anticon 130. c. The builder did not install 19mm particleboard. d. The builder did not install Bradford Soundscreen R3.1. e. As such, the builder has not complied with the specification in the contract in respect of insulation. Our client's consultant expressed concerns at his inspection about the level of heat in the upstairs areas. Please have your client provide a response to the insulation assertions by 5:00pm Tuesday 5 March 2019. … Our client reserves all her rights." 1. On 29 March 2019, the owner's lawyers sent a letter to the builder's lawyers notifying the builder that specified defects in the works had not been rectified and that the works were encroaching over the boundary of the property (the 29 March 2019 letter) in which they relevantly stated: "We refer to our letter dated 1 March 2019 in which our client provided notification of various defects in the works carried out by your client. We note we requested a response to our client's notification by 5 March 2019 and you subsequently advised your client would provide a response by 8 March 2019. We have not received any such response to date. … External paving Your client has not rectified the issue with the direction of fall in the paving, which was previously notified to your client. Insulation In our letter dated 1 March 2019 we provided detailed information in relation to the non-compliance of the insulation. Your client has not provided a response to the non-compliance issues nor has he rectified the insulation. Our client has obtained expert advice from Mr Zervos from CRD Building Consultants & Engineers as follows: 1. In the wall adjoining the neighbouring property, 54 Pearl Street, your client has installed one layer of Fyrchek whereas the contract and the BASIX require two layers. 2. The insulation in the ceiling is undersized - 1.3 R rating has been used whereas 3.8 R rating was specified in the contract. 3. The insulation in the walls is not as specified. 4. The sound insulation has not been installed in accordance with contract specifications and is missing in some areas of the ceiling upstairs. 5. Acoustic plasterboard has not been installed in accordance with contract specifications to areas in the kitchen - normal plasterboard has been used instead. Bathroom ceiling Our client has also obtained advice that the ceiling installed in the bathroom is not water-resistant plasterboard such as Aquachek. The bathroom ceiling is therefore defective and requires replacement. Shower screen installation The tiling in the bathroom does not allow for the shower screen to be channel-set. Your client's representative has advised that the shower screen will not be channel-set because your client "doesn't like doing that'' despite the contract specifications providing for this method of installation. Our client puts your client on notice that if he proceeds to install the shower screens without first rectifying the tiling to include channels, your client will incur unnecessary costs for removal and re-installation of the shower screens which could have been avoided. Our client requires the shower screens to be channel-set and the tiling in the bathroom to be rectified to allow for same. Encroachments We enclose survey obtained by our client showing multiple encroachments over the boundary, as a result of your client's works. Please advise how your client intends to rectify these issues. Rectification We are instructed to request your client provide a written timeline for attending to rectification of the defects and the replacement of improper materials, by 5:00pm Monday 1 April 2019. Our client reserves all her rights." 1. The survey attached to the 29 March 2019 letter is sheet 2 of a boundary plan by an unidentified person contains notations with measurements as to various parts of the building being "clear" and "overhang" and a brick wall from the front verandah to the front of the property on the common boundary with the adjoining property on the northern side. 2. On 8 April 2019, the builder's lawyers sent a letter to the owner's lawyers (the 8 April 2019 letter) in which they asserted that the defects liability period had not commenced, and relevantly stated: "We refer to your letter of 29 March 2019, and are instructed to reply as follows, noting that the defects liability period has not yet commenced. … EXTERNAL PAVING Our client denies that there is an issue with the paving, which has been completed as per the finish floor levels. INSULATION In relation to point 1, our client has installed two (2) lawyers of Fyrcheck insulation. We are instructed that the BASIX certificate makes no mention of the layers of Fyrcheck, but we would be grateful if you could refer us the relevant provision of the BASK certificate seeking this, if we are mistaken? In relation to point 2, our client has installed R3.1 as per the contract, we are instructed that there is no R3.8 insulation as contended by your client. In relation to point 3, the insulation in all external and internal walls is R2.5, which is higher than that specified in the contract. In relation to item 4, the insulation has not been placed around down lights, or where the ceiling mounted television is located, due to insufficient ceiling space, which is taken up by the television and the clearance required around the television, and ceiling lights. In relation to item 5, we are instructed that there were no plastering specifications provided in relation to the double brick wall as this was originally to have been cement rendered. Plasterboard was directly fixed to the brick walls as per standard building practices to achieve the same finish as the other walls in that area. BATHROOM CEILING Our client denies your clients assertion and our client further says that Aquacheck has been used in all bathrooms. SHOWER SCREEN INSTALLATION The channel set sought by your client is not an appropriate method of installation, and exposes the shower screens to significant failure. If your client would like that to have the shower screens installed in that manner, we would suggest that a negative variation be raised for this item, and the works be performed by one of your client's own trades people directly for her? Failing agreement to such a course, our client will install the shower screens in an appropriate and structurally adequate manner, in accordance with good building practices. ENCROACHMENTS Your client in conjunction with the previous neighbour agreed where the location of the dividing wall was to be located, as per the attached emails. Our client installed the dividing wall as instructed and accepts no liability or responsibility for these alleged encroachments whatsoever, as dividing wall was located as instructed by your client, in agreement with her neighbour. RECTIFICATION Given the abovementioned responses, our client is unable to, and is not required to provide a timeline to rectify the alleged issues. We also note again that the defects liability period has not commenced. …" 1. The emails attached to the 8 April 2019 letter included: 1. the email sent on 27 March 2018 at 12.58pm by the owner to Matthew Fitzmaurice (Mr Fitzmaurice) with the subject "Boundary fence" in which she relevantly stated: "With my renovation, I would like to replace the existing boundary paling fence, with a brick fence. It will be the same height. I think this will offer more privacy between our two houses and stop our dogs "facing off"!! The proposed brick wall will be 110mm wide. 55mm of the wall will be on your side and 55mm of the wall will be on my side. I am not asking for a contribution towards the cost of the wall, as I will pay for it. The builder has assured me that during the replacement process, he will ensure that it is "dog safe". Do I have you permission to proceed? Could you please let me know ASAP" 1. the email sent on 27 March 2018 at 1.17pm by Mr Fitzmaurice to the owner with the subject "Boundary fence" (the 27 March 2018 at 1.17pm email) in which he relevantly stated: "Yes, sounds great. …" The first Lucien affidavit 1. In the first Lucien affidavit, the builder denies that the works were defective, and says that the works were not finished, and the defects liability period had not commenced (at [179(b)]). The oral evidence of the builder 1. In his oral evidence the builder conceded that he did not use Aquachek for the bathroom ceilings, and said "It, it was, well a different brand, but it wasn't - it was a water resistant plasterboard" (Tcpt, 21 May 2021, p 61(23)-(25)). The joint building report 1. In the joint building report Messrs Jamieson and Lee expressed the following opinions: 1. the external paving is not defective (item 1.1); 2. the insulation in the roof cavity and first floor external wall is defective (items 11.1, 11.2 and 12.1); 3. rectification of the insulation in the roof cavity would require removal of the metal deck roof (items 11.1, 11.2 and 12.1). The concurrent oral evidence of the experts 1. In the concurrent oral evidence of the experts Messrs Jamieson and Lee gave the following evidence in relation to item 11.1 in the joint building report as to the rectification of the insulation in the roof cavity (Tcpt, 29 April 2021, pp 54(20)-67(35)): 1. Messrs Jamieson said it would be necessary to remove 54m2 of insulation; 2. Mr Lee said that the roof is 54m2. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to the applicable evidence and submitted that the builder did not remedy the defaults she had identified. 2. In the owner's 28 July 2021 submissions and her oral submissions the owner submitted that the builder did not remedy defects. The contract required him to complete the works in accordance with the contract. Defective work and faulty materials prevented the work from conforming to the contract. The defects rectification period applied to defects discovered after completion, not those apparent during the progress of the works. 3. In the owner's 15 September 2021 submissions and her oral submissions the owner submitted that the non-compliant insulation could not be readily rectified during the defects liability period, after all the finishings had been installed in the property. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder made the following submissions: 1. the time to remedy defects had not arisen because the defects liability clause was not then engaged. He intended to honour this clause in the usual manner; 2. the external paving was not non-compliant; 3. the non-compliant insulation was to be rectified by him during the defects liability period, if necessary; 4. he was of the view that the channel set shower screen was not a good building practice, and he did not wish to perform those works because of that fact and offered the owner a credit for that item. The owner did not want a credit and insisted on the channel set shower screens; 5. the remedying of defects would have occurred during the defects liability period contemplated in cl 23 of the general conditions. 1. In the builder's 29 September 2021 submissions the builder submitted that the non-compliant insulation could be readily rectified because it was external to the home and could be undertaken by removing and replacing the insulation and batons beneath a 54m2 iron roof. Consideration 1. Pursuant to cll 3(a) and 9(a) of the general conditions the builder was required to build the works in accordance with the plans and specifications set out in the contract. Further, pursuant to cl 20 of the general conditions the builder was required to build the works so that they did not encroach on the adjoining properties. 2. I am not satisfied in view of the opinions of Messrs Jamieson and Lee In the joint building report that the external paving was not defective. 3. I am satisfied in view of the opinions of Messrs Jamieson and Lee In the joint building report that the insulation was defective in not complying with the provisions of the contract set out in the 1 March 2019 letter. 4. I am satisfied that the bathroom ceiling was defective because it did not comply with the owner specifications by reason of not being built with "Aquachek 13mm". The builder was not entitled to substitute a different brand of water resistant plasterboard for the specified product. 5. I am satisfied that the tiling without channels in the bathroom so as to permit the shower screen to be channel-set was defective because it did not comply with the AK specifications. The builder was not entitled to ignore the contract because he regarded a channel-set shower screen as not being good building practice. 6. I am not satisfied that either the front brick wall on the common boundary between the property and the adjoining property on the northern side and parts of the building works encroached on either adjoining properties in breach of cl 20 of the general conditions. The document described as a survey attached to the 29 March 2019 letter is inadequate to establish any encroachments as it was prepared by an unidentified person. 7. On the proper construction of the contract the builder had an obligation to remedy defects in the following situations: 1. pursuant to cl 8 of the general conditions if having notified the owner the work was complete, he received within 10 days' notice from the owner of items the owner considered to be defective. In this situation the builder would be required to remedy the defective items promptly; 2. pursuant to cl 23 of the general conditions in respect of defects which become which become apparent within the period of 13 weeks from the date of completion. In this situation the builder would be required to remedy the defective items within 30 business days of receipt of notification from the owner; 3. pursuant to cl 23 of the general conditions in respect of major defects which become apparent before the date of completion. The nature of the further defects liability period for such major defects is that the builder would be required to remedy the defective items within 30 business days of receipt of notification from the owner which may be made up to the date being 13 weeks from the date of completion. It is implicit that the obligation to rectify only arises after the date of completion. 1. While the expression "major … defects in the work" in cl 23 of the general conditions is not defined in the contract, I am satisfied that the defect relating to insulation referred to in the 1 March 2019 letter was such a major defect because its rectification involved removing and replacing the insulation and batons beneath a 54m2 iron roof. I am also satisfied that by the 1 March 2019 letter the owner gave notice of this defect to the builder, and that this letter was an effective notice for the purpose of the first paragraph of cl 27 of the general conditions. However, the builder was under no obligation to rectify this defect under either cl 8 or cl 23 of the general conditions because the date of completion within cl 8 of the general conditions had not been reached. 2. I am not satisfied that the defect relating to the bathroom ceiling and the tiling without channels in the bathroom referred to in the 29 March 2019 letter was a major defect in the works within cl 23 of the general conditions. I am satisfied that the 29 March 2019 letter was an effective notice for the purpose of the first paragraph of cl 27 of the general conditions of these defects. However, the builder was under no obligation to rectify this defect under either cl 8 or cl 23 of the general conditions because the date of completion within cl 8 of the contract had not been reached. 3. I am not satisfied that the builder had failed to rectify the defective insulation, the bathroom ceiling and the tiling without channels in the bathroom as at 5 April 2019 because at that time he had no obligation to do so. 4. It follows that I am not satisfied that the owner has established that the builder failed to remedy defective work or remove faulty or unsuitable materials in breach of the contract as at 5 April 2019. Whether the owner validly terminated the contract under its terms Introduction 1. This issue involves consideration of the questions: 1. whether the 5 April 2019 notice was a valid notice; 2. whether the owner validly terminated the contract by the 24 April 2019 notice. 1. Before considering this issue, I have summarised the evidence and submissions of the parties. The evidence 1. The evidence relevant to this issue is set out in the applicable contractual terms and correspondence between the parties. The applicable contractual terms 1. Clause 25 of the general conditions relevantly provided: "Termination of contract by owner Due to the fault of the contractor If the contractor: … • fails to proceed diligently with the work • fails to remedy defective work or remove faulty or unsuitable materials, or … the owner may, if such default can be remedied, notify the contractor in writing that unless the default is remedied within 10 business days or such longer period as specified the owner will terminate the contract. If the contractor does not comply with the owner's request within the time allowed, or if the default cannot be remedied, the owner may terminate the contract by giving written notice to that effect to the contractor." 1. Clause 30 of the contract relevantly provided: "Definitions In the printed general conditions of contract … • 'Business day' means any day other than a Saturday, Sunday, public holiday or 27, 28, 29, 30 or 31 December. … • The rights, powers and remedies provided in this contract are cumulative with, and are not exclusive of, the rights." The correspondence between the parties 1. On 5 April 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the 5 April 2019 notice in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract, that the Builder is In default under the Contract In that: 1. The Builder is failing to diligently proceed with the work under the Contract (Works): a. The time for completion of the Works was 8 November 2018, extended by valid extension of time claims by the Builder until 11 December 2018, however the Works are not yet complete; b. The Builder failed to notify the Owner of the causes and estimated lengths of any delays within ten (10) business days of ^e occurrence of the delay, In order to comply with the requirements for extension of time claims under clause 7 of the Contract; c. The Builder has been sporadically carrying out the Works since January 2019 In a piece-meal fashion; and d. The Builder has failed to communicate directly with the Owner since 21 February 2019, insisting that all communication be through the Builder's solicitor, and this has caused further delays to the Works. 2. The Builder has failed to remedy defects In the Works or remove faulty or unsuitable materials used in relation to the Works: a. By a "Notification of Defects" dated 1 March 2010, the Owner advised the Builder of the following defects and non-compliant materials in the Works: i. Incorrect fall in external paving; and ii. Insulation which is not compliant with the Contract. b. The Owner requested a response to the above issues by 5:00pm 5 March 2019. The Builder advised he would respond by 8 March 2019 however no such response was received. c. By a "Notification of Defects" dated 29 March 2019, the Owner advised the Builder of the following defects and non-compliant materials In the Works; i. Incorrect fall in external paving; ii. Insulation which Is not compliant with the Contract; iii. Defective bathroom celling; iv. Defective tiling In the bathroom, which will prevent the shower screens from being "channel-set" until the tiling is rectified; and v. Encroachments over the boundary caused by the Works. d. The Owner requested a response to the above issues from the Builder, including a timeline for proposed rectification works, by 5;00pm 1 April 2019, however no such response was received. e. The Builder has failed to remedy defects in the Works or replace or rectify unsuitable materials used in the Works, despite requests by the Owner. FURTHER, THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract that If the Builder does not remedy the defaults described above within ten (10) business days then, without prejudice to the Owner's rights, the Owner may terminate the Contract." 1. In the 8 April 2019 letter the builder's lawyers claimed pursuant to cl 7 of the general conditions an extension of time of 305 days under the contract, and relevantly stated: "We refer to your letter of 29 March 2019, and are instructed to reply as follows, … … GARAGE DOOR - VARIATION TO CONTRACT We note in the attached email received from your client on 1 April 2019, that she has approved the design of a new garage door and paid the 50% deposit to Deville Garage Doors, for the same. The garage door specified in the contract was a B&D roller door Squareline (Monument) with control-A-door power drive. Your client ordered a new door, and thereby varied the contract. EXTENSION OF TIME Our client notes the variation, and seeks an extension of time pursuant to clause 7 of the contract from 12 December 2018, until the delivery and installation of the new garage door, ordered by your client on 1 April 2019. In any event the delay from 12 December 2018 to 1 April 2019, with further days to be claimed once the door has been delivered and installed, is set out as follows: BUILDERS EXTENSION OF TIME CLAIMS Delay Cause of delay Period Revised date for practical completion No Commencement 1 March 2018 date Original date of Practical completion 8 November 2018 Extension of Time Claimed 1. Correction of structural plans 5 business days 15 November 2018 2. Re-location of floor 5 business days 22 November 2018 wastes 3. New window / door supplier 34 business days 18 January 2019 4. Police suspension of works 14 December 2018 48 business days 27 March 2019 5. Christmas shut down: 25.12.18-1.1.19 6 business days 4 April 2019 6. Australia day holiday 1 business day 5 April 2019 7. Unavailability of kitchen manufacturer to supply doors 7.12.18-20.1.19 21.1.19-21.2.19 44 business days 6 June 2019 8. Non-selection of paint colours by owner 31.1.19-21.2.19 15 business days 27 June 2019 9. Rain days 10 business days 11 July 2019 10. Delay caused by owner's stone floor suppliers and installers 8 business days 23 July 2019 11. Inability to carry bathtub delivered on 25 February 2019, to upstairs bathroom, due to inadequate width of stairs or size of bathtub. 9 days and ongoing 5 August 2019 12. Delay in delivery of tapware and fixtures and fittings 7 days 14 August 2019 13. Delay caused due to change in front door previously approved by Owner and door hardware. 10 Days and ongoing 28 August 2019 14 Change to garage door selection by Owner on 1 April 2019, 110 days and ongoing 16 December 2019 Period of delay 11 December 2018, to 1 April 2019 Total 305 days Revised date for practical completion 16 December 2019 Pursuant to clause 7 of the contract our client claims an extension for the reasons stated above and as notified, fi-om 9 November 2018 until 16 December 2019. Given the above our client anticipates that a revised date for practical completion of the work will be on 16 December 2019, noting that your clients home will be reasonably capable of being used, in accordance with clause 8 of the contract before that date due to our client's diligent work, which continues on site, despite your client's contentions." 1. On 11 April 2019 at 2.12pm, Mr Tengstrom sent an email to the owner and the builder in which he stated that the absence of LED lights was adding to the time delays (the 11 April 2019 at 2.12pm email): "Just a reminder that we need the led lights asap please stress to the supplier that there mistake needs to be rectified immediately as this adds to the time delays. Also the guest bedroom bulkhead needs to be removed to remove the led lights and will need to stay that way until the lights arrive this will stop the joiners, air conditioning grills and painters from finishing the room." 1. On 11 April 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the document entitled "owner's notice disputing builder's claim for extension of time" (the 11 April 2019 notice) in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 7 of the Contract that the Owner disputes the Builder's claim for extensions of time to complete the works under the Contract as outlined in the letter from Wilkinson Building & Construction Lawyers Pty Ltd dated 8 April 2019, on the following grounds: Delay Business Days No Alleged cause of delay days Owner's comments agreed claimed 1. Correction of structural plans 5 Extension of time accepted 5 2. Re-location of floor wastes 5 Extension of time accepted, although 5 business days is generous 5 Extension of time not accepted. 3. New window/door 34 The window delay was caused by the manufacturer "Aneeta", not the nominated supplier, "Lifestyle Glass". Aneeta carry out the installation of ail their windows therefore the original supplier, "Iconic", would have also been delayed by Aneeta. 7 supplier Iconic carried out a final check measure on 26/07/18 and Lifestyle Glass carried out their final check measure on 1/08/18. The delay caused by the change in window supplier was therefore 7 business days. The Owner is not responsible for delays caused by the Builder's subcontractors and suppliers - any such delay is a matter between the Builder and the third party. Extension of time not accepted. On 14 December 2018 the Builder caused the plasterers to sand the walls and the timber floors to be laid (on incorrect frame) simultaneously with the painters painting the walls. This was ruining the finish of the painting and was dearly a sequencing problem which would mean the painting would have to be re-done. In order to mitigate loss (of either party) the Owner raised the issue with the Builder, which caused him to become aggressive towards the Owner. 4. Police suspension of works 14 December 2018 48 On 14 December 2018 at 7:26am the Builder threatened the Owner on site, raising his clenched fist to the Owner's face and saying words to the effect of; "If you were a man, 1 would punch you in the face". 0 Furthermore, the Builder threatened to cause damage to the Owner's property, saying words to the effect of: "/ will make sure that you never get to move into your house. 1 will smash it all down." As such, the police assistance sought by the Owner was, without a doubt, warranted and due to the fault of the Builder. The Builder was locked out by the Owner from approximately 5:45pm on Friday 14 December 2018 until 6;00am Tuesday 18 December 2018, which is a total of one (1) working day. The Builder chose not to carry out any further work at the site until 14 January 2019. The Builder's assertion that a delay of 48 business days ensued following the police intervention (which in itself was the result of threatened violence by the Builder) is utterly absurd and without merit. 5. Christmas shutdown 6 Extension of time is accepted. 6 Although, If the Builder had carried out works under the Contract with due diligence and completed works by Christmas as he was contractually obliged to do, the Christmas shut down period would not have been in any way relevant. 6. Australia Day Holiday 1 Extension of time is accepted. 1 Although, if the Builder had carried out works under the Contract with due diligence and completed works by Christmas as he was contractually obliged to do, the Christmas shut down period would not have been in any way relevant. Extension of time not accepted. 7. Unavailability of kitchen manufacturer to supply doors 44 There was no meeting with the joiner scheduled for 7 December 2018. The Owner received a text message at 7;33am on 7 December 2018 from the foreman saying: "Can you come in this morning?" however the Owner was not available. No meeting with the joiner was "cancelled" by the Owner. 0 The Builder failed to ensure the joiner proceeded with due diligence and the resulting delay is the fault of the Builder. The Owner is not responsible for delays caused by the Builder's subcontractors and suppliers - any such delay is a matter between the Builder and the third party. 8. Non-selection of paint colours by owner 15 Extension of time not accepted. 0 The paint colours are specified by AKD and are already part of the Contract. No selection by the Owner is required and, as such, the extension of time claim is unsubstantiated and illogical. Extension of time not accepted. 9. Rain days 10 The Contract provides at clause 7; "Both the contractor and the owner (if applicable) must take all reasonable steps to minimise any delay to the work". Furthermore, the work as a whole must be affected by the delay and the critical path of construction activity interrupted. 0 The Builder could have carried out internal work on rain days. Extension of time not accepted. 10. Delay caused by owner's stone tile floor suppliers and installers 8 Pursuant to the Contract the Owner is to supply only the stone tile flooring. 0 There was no delay in the Owner supplying the stone flooring. The delay has been due to the Builder and/or his installer. In or about mid-August 2018 the Owner suggested to the Builder that the bathtub be transported upstairs through a window opening before the windows were installed. The Builder advised the Owner (with full knowledge of the dimensions of the bathtub and the stairs), that the Builder would be able to get the bath up the stairs. 11. Inability to carry bathtub delivered on 25 February 2019, to upstairs bathroom, due to inadequate width of stairs and or size of bathtub 9 and ongoing Furthermore, the Builder had full knowledge of the dimensions of the bathtub and stairs prior to signing the Contract. Pursuant to clause 19 of the Contract, "the contractor must bear all costs involved in the delivery of materials to the work, handling of materials...'' 0 in any event, the Builder contacted a removalist company on 13 March 2019 and arranged for the bath to be moved on 14 March 2019. The Owner's position is that the Builder should have done this earlier in order to avoid any possible delay to the work. The delay was therefore caused by the Builder. 12. Delay in delivery of tapware and fixtures and fittings The delay was caused by the Builder. On 22 February 2019 the Owner provided the site foreman the details of the supplier of the tapware and fixtures and fittings for the Builder to arrange delivery. Builder made no contact with the supplier until 5 March 2019, after which the supplier emailed the Owner advising a delivery date had been arranged. 0 13. Delay caused due to change in front door previously approved by Owner and door hardware 10 and ongoing The Owner denies changing the front door "previously approved". The door specified in the Contract is a $830 "Sydney Woodworkers" door. The Builder and the Owner held discussions in which the Builder recommended the installation of a $500 "Doors Plus" door however the Owner advised the door specified in the Contract must be installed. 0 No delay was caused by the Owner in changing the specification of the garage door. 14.* Change to garage door selection by Owner on 10 and ongoing The Owner advised the Builder of the garage door required by the Owner (which was within the Builder's allowance in the Contract for the garage door) on 4 December 2018, however the Builder failed to order the door. 0 1 April 2019. Period of delay 11 December 2018, to 1 April 2019 There is a three-week lead time on both the garage door specified in the Contract and the door requested by the Owner on 4 December 2018 and the Builder was responsible for ordering the door in a timely manner to avoid any delay to the works. The Owner paid the deposit for the garage door to confirm the order on 8 April 2019 in order to mitigate the delay because the Builder had still not confirmed the order by that date. TOTAL 305 24 *Only new item Further to the above, the Owner gives notice that; A. Some of the delays alleged by the Builder are concurrent delays. For the Builder to simply add up the number of days the works were allegedly delayed by, after various events occurred, is without contractual basis and results in an untenable position of the Builder. B. Importantly: i. the Builder previously issued claims for extensions of time on 31 January 2019 and 12 March 2019, which collectively contained items (1) to (13) above. ii. the Owner responded to the Builder's claim for extensions of time dated 31 January 2019 by notice served on the Builder on 7 February 2019 and In that response addressed items (1) to (10) above; iii. the Owner responded to the Builder's claim for extensions of time dated 12 March 2019 by notice served on the Builder om 15 March 2019 and in that response addressed items (11) to (13) above; iv. the Builder has failed to acknowledge that the Builder's previous extension of time claims are without basis and has simply repeated those claims on 12 March 2019 and 8 April 2019. C. The date for practical completion in the Contract is 7 November 2018. With an extension of time of 24 business days as accepted by the Owner the works under the Contract were due to be completed by 11 December 2018. D. The Builder's claim for extensions of time until 16 December 2019 is strenuously rejected by the Owner and held to be wholly unsubstantiated. The Owner requires the Builder to proceed with the works under the Contract with due diligence and without further delay. E. The Owner reserves her rights in respect of claiming delay damages from the Builder, including loss of rent arising from an inability to lease the dwelling, and storage costs arising from being unable to furnish the dwelling, since the date for completion under the Contract." 1. On 16 April 2019 at 8.37am, Mr Tengstrom sent an email to the owner and the builder in which he requested her to get Sydney Tap to contact her when they received the handle so that he could book in the plumber (the 16 April 2019 at 8.37am email). 2. On 24 April 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the 24 April 2019 notice in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract, that the Builder has failed to remedy his breaches of the Contract, such breaches being notified to the Builder in writing by Notice of Default dated 5 April 2019: 1. The Builder is failing to diligently proceed with the work under the Contract (Works); and 2. The Builder has failed to remedy defects in the Works and remove faulty or unsuitable materials used in relation to the Works; FURTHER, THE OWNER GIVES NOTICE to the Builder pursuant to clause 25 of the Contract that the Contract is hereby terminated. FURTHER AND IN THE ALTERNATIVE, THE OWNER GIVES NOTICE that the Builder has demonstrated that the Builder cannot complete the Works within the time agreed under the Contract, namely 36 calendar weeks from the date referred to in Clause 5 of the Contract (1 March 2018), adjusted in accordance with the terms of the Contract, and such timeframe is an essential term of the Contract. The Owner gives notice that she exercises her common law right to terminate the Contract." 1. In the 6 May 2019 letter the builder's lawyers relevantly stated: We refer to your client's purported Notice of Termination dated 24 April 2019, and are instructed to reply to that purported notice as follows: No Basis for Termination & Defective Notices There is no basis for the purported termination, and the purported termination notice is defective on the following grounds; 1. On 29 March 2019, your client demanded the rectification of defects other than in accordance with contract Clause 23. This demand was premature, as clause 23 deals with defects and the time for the same to be rectified. Your client has 13 weeks from the date of completion which is defined in clause 8, of the contract. 2. Following the letter dated 29 March 2019, your client has then purported to issue a Notice of Default. That notice is dated 5 April 2019, and is defective in that it seeks to engage Clause 23 of the Contract in circumstances where to do such is entirely premature. The second part of the notice relies on the proposition that the Builder has failed to proceed diligently with the work. This is a factual matter and would no doubt be the subject of evidence. That said because your client has introduced prematurely the "Notification of Defects" the entirety of the notice is defective. 3. In a further letter dated 12 April 2019, your client makes reference to Clause 23 of the Contract, which states in the margin note that; defect rectification is not to be used to finish items of work that should have been completed. 4. The suggestion that work is not being done belies the correspondence with the Builder. See for example the email from the Builder to the Owner dated 28 March 2019, copy attached. 5. On 11 April 2019, there then appears to be a purported notice issued by your client pursuant to Clause 7 of the Contract disputing the extension of time claimed by the Builder. This then requires the matter in the absence of agreement to be dealt with in accordance with Clause 27 (Dispute Resolution), That has not occurred. 6. Finally, your client has issued a purported Notice of Termination pursuant to Clause 25 of the Contract. The purported Termination Notice is defective because it proceeds on two (2) erroneous bases, one of which is patently wrong, namely item 2 which is directed at the "completion of work" that is only engaged in Clause 23 of the contract and self-evidently permits a Defects rectification period of 13 weeks. That time has not commenced and the mechanism in the contract has not been followed. Builders Acceptance of Repudiation by Owner We hereby advise and give notice that your client's conduct amounts to a repudiation of the contract, and our client accepts that repudiation and will now sue her for the loss and damages suffered which arise from her repudiatory conduct in accordance with the contract terms. We otherwise reserve all of our client's rights, including the tendering of this letter on any issue including costs." The submissions of the parties The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder made the following submissions: 1. the remedying defects would have occurred during the defects liability period contemplated in cl 23 of the general conditions and in any event on any view the owner failed to engage the dispute resolution mechanism in cl 27 of the general conditions and that the provision of a notice of default is insufficient to comply with that clause; 2. the items in the owner's "Notice of Default" were all capable of remedy in the defects liability period. This opportunity was denied to him because of the unlawful termination of the contract. The submissions of the owner 1. In the owner's 15 September 2021 submissions and her oral submissions the owner submitted that a notice of dispute under the contract is not required to validate a notice of default. Consideration 1. I have found that that the owner has established that the builder failed to proceed with the works diligently in breach of the contract as at 5 April 2019. As this default could have been remedied, and the 5 April 2019 notice stated unless the default was remedied within 10 business days the owner will terminate the contract, then I am satisfied that this notice so far as this default as specified in paragraph 1(a) and (c) was a valid notice within cl 25 of the general conditions. I have found that the owner had on 18 January 2019 and 20 February 2019 notified the builder of the dispute about his failure to proceed diligently with the works with the first paragraph of cl 27 of the general conditions. There was no requirement that the owner invoke the dispute resolution mechanism in the second and/or third paragraphs cl 27 of the general conditions before a valid notice could be issued under cl 25 of the general conditions as these paragraphs on their construction give the parties a discretion whether or not to invoke the mechanism. 2. I have found that that the owner has not established that the builder failed to remedy defective work or remove faulty or unsuitable materials in breach of the contract as at 5 April 2019. It follows that I am not satisfied that this notice so far as any of the defaults as specified in paragraph 2 was a valid notice within cl 25 of the general conditions because the precondition of the giving of a notice under this clause, being the builder "fails to remedy defective work or remove faulty or unsuitable materials", had not been satisfied. 3. I am satisfied that the builder did not comply with the owner's request to remedy the default of failing to proceed with the works diligently within 10 business days of 5 April 2019, being 19 April 2019 having regard to the definition of "business day" in cl 30 of the general conditions, by reason that the only evidence of any further progress with the works was the request made to the owner in the 16 April 2019 at 8.37am email. This request was inadequate to demonstrate that the builder had remedied this defect. The other communication by the builder in this period in the 11 April 2019 at 2.12pm email did not constitute any further progress with the works. 4. As the builder did not comply with the owner's request to remedy the default of failing to proceed with the works diligently by 19 April 2019, then I am satisfied that the owner by the 24 April 2019 notice validly terminated the contract under its terms. 5. As the owner validly terminated the contract under its terms on 24 April 2019, I reject the submission of the builder that the owner by the 24 April 2019 notice repudiated the contract. Whether the owner validly terminated the contract under the general law Introduction 1. The owner's claim is that by the 24 April 2019 notice letter she validly terminated the contract under the general law. 2. In view of my finding that the owner by the 24 April 2019 notice validly terminated the contract under its terms, this issue does not arise for decision. However, in case this finding is erroneous, I have decided to consider this issue. 3. Before considering this issue, I have set out the applicable legal principles, and summarised the evidence and submissions of the parties. While the owner's submissions asserted repudiation of the contract by the builder by conduct in addition to his conduct of failing to proceed with the works diligently, I have limited my consideration of this issue to the breach I have found of cl 6 of the general conditions. The evidence 1. The evidence relating to the issues of whether the builder failed to proceed with the works diligently in breach of the contract as at 5 April 2019 and whether the owner validly terminated the contract under its terms is relevant to the consideration of this issue. The applicable legal principles 1. The term repudiation is used in different senses. First, it may refer to conduct which evinces an unwillingness, or an inability, to render substantial performance of the contract. This is sometimes described as conduct of a party which evinces an intention no longer to be bound by the contract or to fulfil it only in a manner substantially inconsistent with the party's obligations. It may be termed renunciation. The test is whether the conduct of one party is such as to convey to a reasonable person, in the situation of the other party, renunciation either of the contract as a whole or of a fundamental obligation under it. Secondly, it may refer to any breach of contract which justifies termination by the other party. There are two relevant circumstances in which a breach of contract by one party may entitle the other to terminate. The first is where the obligation with which there has been failure to comply has been agreed by the contracting parties to be essential. Such an obligation is sometimes described as a condition. It is the common intention of the parties, expressed in the language of their contract, understood in the context of the relationship established by that contract and the commercial purpose it served, that determines whether a term is "essential", so that any breach will justify termination. The second relevant circumstance is where there has been a sufficiently serious breach of a non-essential term. Such an obligation is sometimes described as an intermediate term. Breaches of this kind are sometimes described as "going to the root of the contract". A judgment that a breach of a term goes to the root of a contract, which has been described "such as to deprive the injured party of a substantial part of the benefit to which he is entitled under the contract", rests primarily upon a construction of the contract. A question as to contractual intention, considered in the light of the language of the contract, the circumstances in which the parties have contracted and their common contemplation as to future performance, is different from a question as to the intention evinced by one of the parties at the time of breach, such as arises in cases of alleged renunciation: Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115 (Koompahtoo) at [44]-[56]; [2007] HCA 61. 2. In Lawrence v Ciantar; Ciantar v Lawrence [2019] NSWSC 464 (Lawrence) at [191] and [201] Henry J said: "[191] The general rule is that breach of an intermediate non-essential time term of a contract does not give rise to a right to terminate unless a party first serves a notice requiring performance within a reasonable time. The exceptions to this are where there is unreasonable delay in performance or anticipated failure to comply with a notice to perform. Unreasonable delay occurs where the delay evidences a repudiation of the obligation by the promisor: see JW Carter, Contract Law in Australia (7th ed, 2018, LexisNexis Butterworths) [30.54 – 30.56]. … [201] The relevant question is whether the evidence outlined above establishes that Mr Lawrence's delay in completing the DA works was sufficiently unreasonable to evince repudiation by him of his obligations under the contract." The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner made the following submissions: 1. the contractual method of termination is not expressed to apply to the exclusion of common law remedies, so that the owner was entitled to terminate the contract at common law on proper grounds; 2. whether or not time to complete was an essential term of the contract, the breach was of sufficient seriousness to justify termination; 3. the extensive delay in completing the work, together with the anticipated further delay, evinced an intention on the part of the builder not to be bound by the contract, justified termination of the contract. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder submitted that there were simply no proper grounds to terminate the contract given the factual circumstances. Consideration 1. Having regard to cl 30 of the general conditions, the right of the parties to terminate the contract under the general law was expressly preserved. 2. Having regard to the principles in Koompahtoo at [44]-[56], I am satisfied that on the proper construction of the contract the obligation of the builder under cl 6 of the general conditions to diligently proceed and complete the work within the specified period as amended was an intermediate term. 3. For the same reasons that I have found that the builder failed to proceed with the works diligently in breach of the contract as at 5 April 2019, I am satisfied that there was unreasonable delay in performance of his obligation under cl 6 of the general conditions as at that date. For the same reasons that I have found that the builder failed to remedy this default by 24 April 2019, I am satisfied that the unreasonable delay in performance of his obligation under cl 6 of the general conditions by the builder continued up to 24 April 2019. 4. In these circumstances and in accordance with the principle in Lawrence at [191], it was unnecessary for the owner to give notice of the builder of her intention to terminate the contract if he failed to remedy this default. Accordingly, I am satisfied that the owner by the 24 April 2019 notice validly terminated the contract under the general law in accordance with the express statement to this effect. 5. As the owner validly terminated the contract under the general law on 24 April 2019, I reject the submission of the builder that the owner by the 24 April 2019 notice repudiated the contract. Whether the works undertaken by the builder were defective, and if so the reasonable cost of rectifying the defects Introduction 1. The parties proceeded on the basis that any items of defective work constituted a breach of cl 9(a) of the general conditions and the statutory warranties implied in the contract pursuant to s 18B(1)(a) of the HB Act. 2. The parties reached agreement in the joint building report as to the items which were defective, the scope of works for the rectification of the defective items, and the reasonable cost of rectifying these items exclusive of GST: 1. item 2.1 – courtyard planter box – waterproof membrane: $2,211.00; 2. item 2.2 – courtyard planter box – waterproof membrane: $190.00; 3. item 3 – carport – door & lock: $857.50; 4. item 4 – carport – timber framed walls: $1,678.00; 5. items 5.1 – living room – bifold doors: $259.00; 6. items 5.2 – living room – bifold doors: $587.50; 7. item 6 – windows: $1,310.00; 8. item 7 – windows – fly screens: $1,544.00; 9. item 8 – main bathroom – cracked tile: $285.00; 10. item 9 – internal paint finishes: $4,984.00; 11. item 10 – laundry door: $300.00; 12. item 11.3 – first floor addition – lack of plasterboard in roof cavity: $2,390.00; 13. item 13 – skylights: $2,250.00; 14. item 15 – main bathroom joinery unit drawers: $294.00. 1. By reason of the agreed position of the parties set out at [28(1)] and [228] above it is only necessary to determine the items that remain in dispute. 2. The dispute between the parties as to the remaining items was as to one or more of the questions whether the item was defective, and where it is found to be defective the method of rectification the reasonable amount to rectify the item where it is found to be defective. The builder in his various written submissions and his oral submissions did not make any submission that the rectification of any item found to be defective was an unreasonable course to adopt. 3. For each item that remains in dispute I have summarised the evidence and submissions of the parties, and then considered the item. Before considering the items that remain in dispute I have summarised the evidence of the parties, and considered the rate for labour, and the time, that should be allowed to rectify defective works. The rate for labour that should be allowed to rectify defective works The first Jamieson report 1. In the first Jamieson report Mr Jamieson has allowed $102.50 per hour as the rate for labour, being an hourly rate of $95.00 referenced to Rawlinsons Australian Construction Handbook (38th edition, 2020, Rawlinsons Publishing) (Rawlinsons), p 734, and an allowance of $7.50 for plant and small tools. However, he has also referred to $85.00 as being the hourly labour rate for tradesman and the "market rate" in discussing incomplete work. The Lee report 1. In the Lee report Mr Lee has allowed $75.00 per hour as the rate for skilled labour. The concurrent oral evidence of the experts 1. In the concurrent oral evidence of the experts on this item (Tcpt, 29 April 2021, pp 54(20)-67(35)): 1. Mr Lee said the rate of $102.50 per hour as the rate for labour was excessive (Tcpt, 29 April 2021, pp 60(50)-61(6)); 2. Mr Jamieson the rate of $102.50 per hour as the rate for labour was appropriate because it obtained from Rawlinsons price book together with a separate allowance for some small tools that would be used with the rectification work (Tcpt, 29 April 2021, p 62(4)-(14)). Consideration 1. I am not satisfied that the applicant has established that the rate for labour that should be allowed to rectify defective works is $102.50 per hour. There is no proper basis to add an allowance to a labour rate for small tools, particularly where the rectification would be undertaken by specialist contractors. I do not agree with the labour rate in Rawlinsons in circumstances where Mr Jamieson has also referred to $85.00 per hour as being the "market rate" for tradesmen. Mr Jamieson did not provide any explanation as to why the rate for labour for rectifying defective work is different to the rate for labour for completing incomplete work. Doing the best I can, I have decided the split the difference between $85.00 per hour and $75.00 per hour and to allow $80.00 per hour as the rate for labour to rectify defective works. The time that should be allowed to rectify defective works The first Jamieson report 1. In the first Jamieson report Mr Jamieson has set out the number of hours he has allowed for most parts of the rectification works. The Lee report 1. In the Lee report Mr Lee has set out the number of hours he has allowed for most parts of the rectification works. The concurrent oral evidence of the experts 1. In the concurrent oral evidence of the experts on this item: 1. Mr Lee said that the amounts allowed by Mr Jamieson were excessive (Tcpt, 29 April 2021, p 61(1)-(20)); 2. Mr Jamieson explained the differences between his amounts and those of Mr Lee's because he reflected the difficulty and the constraints that he see in the work while Mr Lee's rates apply in a more simple, straightforward construction (Tcpt, 29 April 2021, p 61(22)-(46)). Consideration 1. I am not satisfied that the applicant has established that the time allowed by Mr Jamieson in the first Jamieson report to rectify defective works is reasonable. I am not satisfied that the rectification works are of such difficulty as to require the number of hours allowed by Mr Jamieson. I have reduced the number of hours to reflect a reasonable time for rectification works that are straight forward in circumstances where there is a detailed scope of works. Item 11.1 – First floor addition – insulation in the roof cavity The joint building report. 1. In the joint building report Messrs Jamieson and Lee expressed the following opinions: 1. Mr Lee costed rectification at $10,924.00 and provided detailed calculations of his costing; 2. Mr Jamieson costed rectification at $18,284.00 and provided detailed calculations of his costing including 21 hours for labour for external work and clean up. The concurrent oral evidence of the experts 1. In the concurrent oral evidence of the experts on this item (Tcpt, 29 April 2021, pp 54(20)-67(35)): 1. Mr Jamieson reduced his costing by $564.00 to $18,284.00 because of an error he made in the thickness of the insulation required; 2. Mr Lee in respect of the detailed calculations of Mr Jamieson's costing disagreed with some items and expressed the opinion that the labour rate is excessive and the square metreage rate for the blanket and the reinstallation of the metal roofing, including extra items of capping and flashing is excessive; 3. Mr Jamieson expressed the opinion that Mr Lee's rates may apply in a more simple, straightforward construction, and that explains the metre times rate differences, which is the bulk of the cost. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner made a detailed analysis of the difference between the costings of Messrs Jamieson and Lee. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder submitted that the costings of Mr Jamieson are excessive. Consideration 1. I am not satisfied with the costings of either Mr Jamieson or Mr Lee. Mr Jamieson allowed for possible damage such as $500.00 for replacement of capping and flashing that may become deformed or damaged during removal. Mr Jamieson proposed using scaffolding, while Mr Lee proposed using a safety harness. Further, Mr Jamieson has allowed 10 hours for the cleaning and touch up of the site which I consider to be excessive and have reduced to 5 hours. 2. Doing the best I can, I have allowed $16,911.50 for this item. I have deducted $1,372.50 from the costings of Mr Jamieson, being $500.00 for replacement of capping and flashing that may become deformed or damaged during removal, 5 hours for excessive labour ($102.50 x 5 = $512.50) and the excessive labour charge ($22.50 x 16 = $360.00). Item 11.4 – First floor addition – ceiling penetrations The applicable contractual terms 1. The acoustic report required the penetrations to the ceiling to be acoustically treated. The Pearce report 1. In the Pearce report Ms Pearce expressed the opinion that mechanical penetrations in the storeroom were untreated and have degraded the acoustic performance, and provided a scope of works for the rectification of this defect. The joint building report 1. In the joint building report Messrs Jamieson and Lee expressed the following opinions: 1. this item was for determination by the acoustic experts; 2. this item satisfied the performance requirements, but did not met the owner's specifications. The concurrent oral evidence of the experts 1. In the concurrent oral evidence of the experts Messrs Jamieson and Lee did not give evidence about the cost of rectification of this item. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner submits $1,300.00 should be allowed for this item. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder submitted that this item was part of item 11.1. Consideration 1. I am satisfied on the basis of the acoustic report and the Pearce report that this item is defective. 2. However, in the absence of any evidence I have decided that no amount should be allowed as the reasonable cost of the rectification of this defect. The owner provided no support for the amount of $1,300.00 claimed for this item. Item 12.1 – First floor addition – external wall insulation The joint building report 1. In the joint building report Messrs Jamieson and Lee expressed the following opinions: 1. they agreed that this item is a defect and as to the scope of the rectification works; 2. they disagreed as to how the rectification works are to be executed with Mr Lee providing his costings on the basis of the rectification works being undertake externally, and Mr Jamieson providing his costings on the basis of the rectification works being undertake internally; 3. Mr Lee costed rectification at $8,258.00 and provided detailed calculations of his costing; 4. Mr Jamieson costed rectification at $33,957.00 and provided detailed calculations of his costing including 172.50 hours for labour for external and internal work and clean up, and a total of $13,923.95 calculated on 31.14m2. The concurrent oral evidence of the experts 1. In the concurrent oral evidence of the experts on this item (Tcpt, 29 April 2021, pp 67(37)-75(44)): 1. Mr Lee expressed the opinion that the rates used by Mr Jamieson were excessive; 2. Mr Jamieson said he allowed for 31.14m2 for two walls based on the marked up diagram, while Mr Lee allowed for 24m2 for one wall; 3. Mr Jamieson said he inspected the space between the properties, and expressed the opinion that the space of 200mm was insufficient to undertake the rectification works externally. Mr Clarkson agreed with Mr Jamieson's opinion; 4. Mr Burton expressed the opinion that the space of between 200mm and 260mm was sufficient to undertake the rectification works externally. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner submitted that the method and costings of Mr Jamieson would be preferred. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder submitted that the costings of Mr Jamieson are excessive. Consideration 1. I am not satisfied that the rectification works can be undertaken externally. I prefer the evidence of Messrs Jamieson and Clarkson to Mr Burton that there is insufficient for external rectification works. Accordingly, I have proceeded on the basis of the rectification works being undertaken internally. 2. I am not satisfied with the costings of Mr Jamieson in the following respects: 1. the allowance of 16 hours for demobilise is excessive and should be reduced to 8 hours; 2. the allowance of 20 hours for removal of furniture and other items including fitted robe and installation of protections is excessive and should be reduced to 8 hours; 3. the allowance of 8 hours for return of furniture and reinstallation of fitted robe is excessive and should be reduced to 4 hours; 4. the allowance of 22.5 hours for the manual handling of removed materials is excessive and should be reduced to 10 hours; 5. the allowance of 90 hours for carrying out these works from the inside of the property is excessive and should be reduced to 30 hours; 6. the allowance of 16 hours for protecting surfaces, removing and reinstalling carpet is excessive and should be reduced to 8 hours; 7. his costings were based on an assumption of there being two walls requiring rectification with a total area of 31.14m2. This assumption has not been established and so I have calculated the cost of rectification based on one wall with a total area of 24m2. 1. Doing the best I can, I have allowed $18,488.82 for this item. I deducted from the costings of Mr Jamieson $15,468.18, being 104.5 hours for excessive labour ($102.50 x 104.50 = $10,711.25), the excessive labour charge ($22.50 x 68 = $1,530.00), and $3,226.93 for the cost of rectification work for the reduced area of 24m2. Item 14 - Water ingress on southern boundary above internal stairs The Zakrzewski report 1. In the Zakrzewski report Mr Zakrzewski stated that he carried out an inspection of the property on 13 March 2020 and expressed the following opinions: 1. there was no evidence that water entering through the glass panel roof area which was inadequately sealed; 2. the timber windows installed to the front second storey middle area of the roof had been installed without metal flashing and sarking; 3. the skylight had been incorrectly installed. The Kyle report 1. In the Kyle report Mr Kyle, who carried out an inspection of the property between 6 and 9 October 2020, said there was evidence of water affected paint on the southern boundary above the internal stairs, and testing demonstrated moisture readings of 39% to 43% in this area. He observed the neighbouring property was being renovated at the time. The second Mullally affidavit 1. In the second Mullally affidavit the owner annexed a quotation dated 19 May 2020 of Tomkat Roofing (the 19 May 2020 of Tomkat quotation) which included the following items: 1. seal all joins, flashings and rear timber windows: $1,800.00 plus GST; 2. supply and install new back tray to skylight: $1,550.00 plus GST. The Burton report 1. In the Burton report Mr Burton, who carried out inspections of the property on 27 July 2020 and 19 August 2020, did not address this item. The joint building report 1. In the joint building report Messrs Jamieson and Lee did not provide costings for this item. The oral evidence of the builder 1. The builder gave oral evidence that the owner complained of a water damaged ceiling of the upstairs bathroom in December 2018, water was coming through one of the penetrations, and he thought that he repaired it (Tcpt, 21 May 2021, p 61(36)-(45)). The concurrent oral evidence of the experts 1. In the concurrent oral evidence of the experts on this item (Tcpt, 29 April 2021, pp 76(38)-83(24)): 1. Mr Burton said he went onto the roof, and suggested that water ingress in the area above the stairs was the result of work being carried out on the neighbouring property. Other possible causes were a displaced tile, a chimney without flashing, and incorrectly terminated flashings; 2. Mr Kyle said he did not inspect the roof. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner submitted that she is not required to negative every speculative possibility. The leaks are apparent in the work done by the builder, which included a new roof with a number of penetrations for skylights, glass panels and air conditioning. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder submitted that the leak has resulted from works on the neighbouring property, and it has not been caused by his works. Further, the Zakrzewski report was not prepared in accordance with the Code of Conduct for Expert Witnesses. Consideration 1. I am satisfied that the water ingress on southern boundary above internal stairs was caused by the incorrect installation of one or more of the timber windows, the skylight, and the air conditioning penetrations on the roof. I am not satisfied that this water ingress was caused by the inadequately sealed glass panel roof area In view of the absence of any evidence of water ingress. I prefer the opinions of Mr Zakrzewski in the Zakrzewski report notwithstanding his failure to comply with the Code of Conduct for Expert Witnesses to the oral evidence of Mr Burton as they were based an inspection of the roof area about 4.5 months prior to the first inspection of Mr Burton. I do not accept the speculative opinions of Mr Burton, particularly as he did not engage with the opinions of Mr Zakrzewski. 2. I am satisfied in the absence of any contrary evidence that the amounts of $1,800.00 and $1,550.00 in the 19 May 2020 of Tomkat quotation are a reasonable cost for the rectification of these defects. Taking in account the agreed amount of $500 for the rectification of the penetrations for air conditioning I have allowed $3,850.00 for this item. Items 16, 17 and 18 – Preliminaries, Overhead & Profit, and Contingency The joint building report 1. In the joint building report Messrs Jamieson and Lee expressed the following opinions: 1. Mr Jamieson allowed $31,445.00, $16,196.40 and $18,625.86 for preliminaries, overhead and profit (at a rate of 15%), and contingency respectively; 2. Mr Lee allowed $13,390.00 and $7,831.80 for preliminaries, and overhead and profit (at a rate of 15%) respectively. He did not allow any amount for contingency. The concurrent oral evidence of the experts 1. In the concurrent oral evidence of the experts on this item (Tcpt, 29 April 2021, pp 83(26)-85(9)): 1. Mr Jamieson said that the reason that you need a builder involved is to assure the quality and the standards and the safety of the work and how it is carried out. The risk of engaging individual subcontractors is that you potentially do not have the expertise as the home owner to supervise these people and to understand that they are doing the work in the correct way. So there is an overarching supervisory quality and safety responsibility that needs to be considered as part of the indirect cost of the work; 2. Mr Jamieson also said that he had made an allowance of 15% for contingency and this is to cover unforeseen items which eventuate in the execution of the works. He was not sure what would be found when the roof was opened; 3. Mr Burton expressed the opinion that an amount for contingency was not necessary because specialist contractors would be engaged and there is such a clearly defined scope of rectification works. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner made the following submissions: 1. the work to be performed includes working at heights. The owner, rather than a builder, would be the person conducting an undertaking and the premises would be a "workplace", within the meaning of the Work Health and Safety Act 2011 (NSW) (the WHS Act). As a person conducting an undertaking, the owner would be under a duty to identify hazards. As a principal contractor, she would be required to develop a work health and safety management plan, provide first aid, obtain any necessary work permits, for instance for confined space entry permits, and ensure that workers attending the site have current accredited safety training cards; 2. there is the issue of compliance and standards. The builder proved unable to resist substituting products he considered good enough for products specified by the contract. Proper supervision of trades is required to ensure this does not happen again; 3. the rectifying builder will be opening up closed cavities in the wall and roof of work done by a builder who has proved himself less than trustworthy in complying with the specifications of the contract. Further, the builder has not yet handed over the certificates he obtained during the progress of the work. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder made the following submissions: 1. the items which needed to be rectified are specialist tradesman works which do not require the supervision of a builder; 2. the works relate to the rectification of new works and there are unlikely to be any contingencies; 3. the amounts sought for preliminaries are also not necessary as the rectification works will be performed by licenced trades people with the appropriate licences, materials, plant, and equipment required to perform the works. Consideration 1. I am not satisfied that any amount should be allowed for preliminaries, overhead and profit, and contingency for the following reasons: 1. there is detailed scope of works for the rectification works; 2. the rectification works can be carried out by specialist contractors with their own equipment and without the supervision of a builder; 3. in engaging specialist contractors would not conducting an undertaking such as to engage the obligations under the WHS Act. Conclusion 1. Having regard to the agreed position of the parties and my findings I am satisfied that: 1. items 2.1, 2.2, 3, 4, 5.1, 5.2, 6 to 10, 11.1, 11.3, 11.4, 12.1, and 13 to 15 in the amended scott schedule are defects; 2. the reasonable cost of rectifying these defects is $58,390.32 exclusive of GST and $64,229.35 inclusive of GST. Whether the builder ought to be ordered to pay damages rather than rectify the defective work Introduction 1. The builder seeks a work order in respect of the defective work, while the owner seeks a money order. 2. The owner relied on evidence and made submissions in opposing a work order that the Tribunal could not have confidence in the builder rectifying defective work because he is not honest, competent, trustworthy or reliable having regard to specified matters. The builder disputed this evidence and made submissions in response to the owner's submissions. It is unnecessary to set out the disputed evidence and submissions and make findings about the honesty, competence, trustworthiness and reliability of the builder as I have decided that the owner is entitled to a money order without regard to these considerations. 3. Before considering this issue I have set out the applicable provisions of the HB Act and legal principles, and summarised the submissions of the parties that are unrelated to the honesty, competence, trustworthiness and reliability of the builder. The applicable provisions of the HB Act 1. Part 3A Division 4 (ss 48K-48MA) includes s 48MA which deals with the rectification of defective work and provides: 48MA Rectification of defective work is preferred outcome in proceedings A court or tribunal determining a building claim involving an allegation of defective residential building work or specialist work by a party to the proceedings (the responsible party) is to have regard to the principle that rectification of the defective work by the responsible party is the preferred outcome. 1. Part 3A Division 5 (ss 48N-48N) contains provisions dealing with the powers of the Tribunal in relation to building claims. Section 48O deals with the orders which the Tribunal may make, and relevantly provides: 48O Powers of Tribunal (1) In determining a building claim, the Tribunal is empowered to make one or more of the following orders as it considers appropriate: (a) an order that one party to the proceedings pay money to another party or to a person specified in the order, whether by way of debt, damages or restitution, or refund any money paid by a specified person, … (c) an order that a party to the proceedings: (i) do any specified work or perform any specified service or any obligation arising under this Act or the terms of any agreement, or The applicable legal principles The application of s 48MA of the HB Act 1. In Kurmond Homes Pty Ltd v Marsden [2018] NSWCATAP 23 (Kurmond) at [42]-[46] and [55] the Appeal Panel identified the following five factors relevant to the nature of the obligation imposed on the court or tribunal by s 48MA of the HB Act: 1. first, the principle, by its terms, only applies "in determining a building claim involving an allegation of defective residential building work or specialist work". It is not expressed to apply where, for example, the building claim only involves an allegation of incomplete residential building work or specialist work. That is not to suggest s 48O does not otherwise permit a work order in respect of work found to be incomplete; 2. second, s 48MA is directed towards the remedy or "outcome" to be provided by the court or tribunal where a claimant establishes the responsible party has carried out defective residential building work or specialist work. In this sense, it is not properly described as a "presumption". Rather, it is a remedy to be "preferred" to other forms of order which the court or tribunal might make; 3. third, while s 48MA provides the court or tribunal "is to have regard to the principle that rectification of the defective work by the responsible party is the preferred outcome", the section does not mandate that a work order must be made in all cases. Further, the section does not confine the form of orders that may be made under s 48O, including an order that defective work be rectified by the responsible party engaging another person to carry out that work on behalf of the responsible party; 4. fourth, the term "preferred" is not defined. The HB Act and the Home Building Regulation 2014 (NSW) do not specify circumstances in which the preferred outcome is not to be adopted. However, guidance as to the meaning of "preferred" and the circumstances that would justify an order for a different outcome is found in the second reading speech where the Minister for Fair Trading makes clear that the purpose of the amendment (New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 6 May 2014) was to: "(1) prevent a homeowner from unreasonably refusing a builder access to a building site to rectify defective work; (2) permit a builder to return to carry out necessary rectification work if they are willing; and (3) support the timely and cost-effective resolution of disputes." That is, in deciding what order should be made, a court or tribunal may consider whether there is a reasonable basis for any objection raised by the homeowner to the builder being permitted to rectify the defective work, the terms of any order, whether the builder is willing to return and whether such an order would support a timely and cost effective resolution of the dispute; 1. fifth, the fact there is a dispute which has necessitated the commencement of proceedings by an aggrieved homeowner is not of itself sufficient to justify the Tribunal in departing from an application of the preferred outcome principle in s 48MA. 1. In Clements v Murphy [2018] NSWCATAP 152 (Clements) at [31] the Appeal Panel held that where a building contract has been terminated prior to completion of the work by reason of the builder's repudiation, it would be unusual for the Tribunal to direct the builder to return to complete the work. On its true construction, s 48MA does not require the Tribunal to consider that that should be the preferred outcome. The measure of damages for breach of a building contract 1. The ruling principle in assessing damages for breach of contract is that the plaintiff is entitled to recover the amount necessary to place him or her in the same position as if the contract had been performed. In the case of defective building work, the usual measure of damages is the cost of rectifying the work to produce conformity with the contract. This is known as the general rule in Bellgrove v Eldridge. That rule is qualified by a requirement that the rectification work must be necessary to produce conformity with the contract and must be a reasonable course to adopt. Whether remedial work is 'necessary' and 'reasonable' is a question of fact. The test of unreasonableness will only be satisfied by fairly exceptional circumstances: Xtraordinary Constructions Pty Ltd v Luppino [2021] SASC 132 at [48]. 2. The general rule in Bellgrove v Eldridge is applied in the Tribunal in determining the measure of damages for defective work in a building claim under the HB Act: Woodward v D J & T L Mellross Pty Ltd [2018] NSWCATAP 179 at [51]-[53]. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner submitted that a work order is a type of specific performance of the contract. It would not be available if either party repudiated the contract and the repudiation was accepted by the innocent party. The submissions of the builder 1. In the builder's 20 August 2021 submissions the builder sets out the terms of the work order it is seeking: "The Builder will rectify items 11.1, 11.4, and 12.1 as stated in the Scott Schedule within six (6) weeks of access to the site being provided by the Owner to the Builder by agreement of the Owner and the Builder. Noting time needs to be provided for the Builder to obtain measurements, order materials, and have those materials delivered to the site for installation by the Builder or his subcontractors. The Owner will not impede the Builder in the performance of him or his subcontractors whilst performing the works, including access to the site, the rear lane, the car space and an electrical power supply. The Builder will complete the works within six (6) weeks of commencement of the works on site. The Builder's rectification works are to be performed to the satisfaction of an independent Building consultant to be agreed to by the parties. The Builder will pay the costs of the building consultant to inspect the works. The Builder will clean the areas within which the work is performed upon completion of the works. In the event the Builder fails to perform the works as ordered by the Tribunal within six (6) weeks of commencement of the works on site the Owner shall be entitled to seek a money order against the Builder for items 11.1, 11.4, and 12.1 of the Scott Schedule. The Owner will not be entitled to a money order in circumstances where she has impeded the Builder in any way or acted unreasonably in allowing the Builder to perform the rectification works." 1. In the builder's 20 August 2021 submissions the builder submitted that the Tribunal should make a work order because the owner has wrongfully terminated the contract. Consideration 1. Having regard to my finding that the builder breached cl 6 of the general conditions and thereby repudiated the contract, and the principles in Kurmond at [42]-[46] and [55] and Clements at [31], I am satisfied that it is inappropriate to exercise the discretion under s 48O(1)(c)(i) of the HB Act to make a work order in respect of the defective work. Having repudiated the contract, there is no proper basis to allow the builder an opportunity to rectify the defective work. The nature of the breach of the contract and the circumstances of its repudiation by the builder mean that the owner should not be subjected to further building work by the builder. 2. It follows that the owner is entitled to a money order under s 48O(1)(a) of the HB Act in accordance with the general principle in Bellgrove v Eldridge in the sum of $64,229.35 inclusive of GST which I have found to be the reasonable amount to rectify the defective work. Whether the works undertaken by the builder were incomplete, and if so the damages recoverable by the owner Introduction 1. The parties reached agreement as to the items in which were incomplete, and the reasonable cost of completing these incomplete items exclusive of GST: 1. item 40 – A1 - boundary wall Pearl Lane blueboard not masonry: $211.00; 2. item 42 – A4 – semi recessed HWS not recessed: $436.00; 3. item 43 – A5 – rendering ground floor walls plasterboard not render: $706.00; 4. items 44 and 45 – A6 – ground floor shower screen channel fix, and bracket fix: $169.00; 5. item 46 – timber feature around kitchen not erected: $799.00; 6. item 49 – incorrect insulation to internal walls: $430.00; 7. item 50 – storage room door not installed: $814.00; 8. item 51 – B1 - site surveyor set out not done: $680.00; 9. item 52 – B2 - site surveyor final not done: $340.00; 10. item 53 – B4 – servo drive unit only for d/w panel: $250.00; 11. item 54 – B5 - tip on legrabox runners 500mm long: $234.00; 12. item 55 – B6 - 3 x blum aventos lift up doors where shown: $419.00; 13. item 56 – B7 - blum motion movento runners with tip on to base cabinet: $130.00; 14. item 57 – B8 – LED ally channel recessed to cabinet soffit panel not recessed: $107.00; 15. item 58 – B9 – LED ally recessed to soffit panel of s/c only not recessed: $160.00; 16. item 59 – B10 - LED ally strip recessed where indicated not recessed: $438.00; 17. item 62 – B13 – LED strip to top of cabinet ally channel to be recessed: $320.00; 18. item 63 – B14-B22 – storage room robe not built: $2,588.00; 19. item 64 – B23 – push to open doors: $78.00; 20. item 67 – B26 – supply and install PIR sensors to ech robe and WIR: $477.00; 21. item 68 – B27 – supply and install digital 24/7 D/S timer for lighting: $629.00; 22. item 69 – B28 – supply and install external PIR for lighting: $270.00; 23. item 70 – B29 – supply and install flush mounted Clipsall smoke detector: $84.00; 24. item 71 – B30 – supply and install Clipsall 2000 light switches to suit lighting lay-out: $234.00; 25. item 72 – B31 – supply and install 10 x Clipsall universal dimmers: $880.00; 26. item 73 – B32 – PC allowance for door furniture: $450.00; 27. item 82 – Deville garage doors: $1,981.82; 28. item 83 – Richard Knight plumbing invoice 6200: $1,150.00; 29. item 85 – Palmers Glass: $3,830.00; 30. item 86 – Glenco Electrics Inv. 1909028: $4,230.00; 31. item 91 – Glenco Electrics Inv. 1909331: $1,410.45; 32. item 94 – Glenco Electrics Inv. 141200: $130.00; 33. item 95 – Richard Knight plumbing invoice 6233: $1,050.00; 34. item 96 – Denman painting and wallpaper: $200.00; 35. item 97 – Glenco Electrics Inv. 2000044: $170.00; 36. item 98 – Glenco Electrics Inv. 143305: $218.00; 37. item 99 – Glenco Electrics Inv. 139002: $170.00; 38. item 100 – Hafele ailo Euro Cargo ST45 x 1: $542.00; 39. item 101 – Richard Knight plumbing invoice 6318: $890.00; 40. item 102 – Glenco Electrics Inv. 20269: $290.00. 1. By reason of the agreed position of the parties set out at [28(3)], [28(5)] and [292] above it is only necessary to determine the items that remain in dispute. 2. For each item that remains in dispute I have summarised the evidence and submissions of the parties, and then considered the item. 3. The builder made submissions relating to items 76 and 87 that the owner conceded that these items were not part of the contractual scope of works. By reason of my rejection of the tender of the third Mullally affidavit (MFI 1), there was no such concession by the owner. I have not dealt with this submission in my consideration of each of items 76 and 87. In any event, the question of whether any items are part of the contractual scope of works involves the construction of the contract and is not answered by reference to the subjective view of the owner. 4. The builder also made submissions relating to items 65, 75, 79, 80 and 88 of the amended scott schedule that because of their omission from the Contract Inclusions document they should be taken have been withdrawn by the owner. I am not satisfied that the omission of these items from the Contract Inclusions document constitutes a withdrawal of these items. No such concession was made by the owner. I have not dealt with this submission in my consideration of each of items 75, 79, 80 and 88. Item 39 – A1 – masonry wall 50/52 not erected The applicable contractual terms 1. Drawing DA.1001 of the PW plans has yellow shaded signifying "proposed building works" on the northern side. Drawing DA.1002 of the PW plans which has the drawing title "Ground Floor Plan" has the red shaded area with the notation "re-build wall to boundary" on the northern side and the grey shaded area with the notation "existing masonry wall" on the northern side, the red shaded area with the notations "new cavity brick wall" and new rendered block wall on the southern side. The first Jamieson report 1. In the first Jamieson report Mr Jamieson has costed construction at $4,669.00 and provided detailed calculations of his costing which is referenced by Rawlinsons at p 468. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to drawing DA.1001 of the PW plans and the costing of this item by Mr Jamieson in the first Jamieson report. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder submitted that no specification is provided in drawing number DA.1001 for a masonry wall to be constructed between the property and the adjoining property. Consideration 1. I am satisfied that drawings DA.1001 and DA.1002 of the PW plans depict a masonry wall between the property and the adjoining property on the northern side and accordingly that this item was part of the contractual scope of works. 2. I am also satisfied that a masonry wall was not constructed and that in the absence of any other evidence the reasonable cost of its construction is $4,669.00. Item 47 – A9 – garage bin storage enclosure not erected The applicable contractual terms 1. Clause 33 of the special conditions provided: "The scope of work and finishes set out in the Smith & Sons quotation shall take precedence over the specifications and finishes of Alexandra Kidd Designs, attached hereto, in the event of a conflict." 1. The 11 July 2017 quote relevantly provided: "37 Landscaping 37.1 Landscaping area no plants have been allowed." 1. Sheet 2 of the BSG plan depicts enclosed arrears with the notations "bin area" and "storage". 2. Drawing AKD-003 of the AK specifications does not depict a garage bin storage enclosure. The first Jamieson report 1. In the first Jamieson report Mr Jamieson has costed construction at $2,055.00 and provided some details of his costing. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to the 11 July 2017 quote, sheet 2 of the BSG plan and the costing of this item by Mr Jamieson in the first Jamieson report. The submissions of the builder 1. In the builder's 16 July 2021 submissions, the builder's 20 August 2021 submissions and his oral submissions the builder submitted that this item was not part of the contract scope of works, and referred to drawing AKD-003 of the AK specifications, the 11 July 2017 quote, and cl 33 of the special conditions. Consideration 1. I am satisfied that sheet 2 of the BSG plan depicts enclosed arrears with the notations "bin area" and "storage", and accordingly that this item was part of the contractual scope of works. While I agree that drawing AKD-003 of the AK specifications does not depict this item, this is not surprising as it addresses the "Ground Floor Lighting + Mechanical Layout". I do not consider that there is any relevant conflict between the AK specifications and the 11 July 2017 quote, and so cl 33 of the special conditions is not relevant to the determination of whether this item forms part of the contractual scope of works. 2. I am also satisfied that a garage bin storage enclosure was not constructed and that in the absence of any other evidence the reasonable cost of its construction is $2,055.00. Item 48 – external venetian recessing The applicable contractual terms 1. The 11 July 2017 quote relevantly provided: "46 Motorised Venetian Blind 46.1: Supply and fit motorised Venetian Hella AR 92 for bedroom 1 only includes wind sensor & remote control." 1. Drawing DA.1003 of the PW plans depicts several adjustable louvre/blinds. 2. Each of drawing AKD-003 of the AK specifications and drawing AKD-004 of the AK specifications does not depict a motorised venetian blind. The correspondence between the parties 1. On 7 May 2017 at 9.45pm, the builder in an email to the owner (the 7 May 2017 at 9.45pm email) attached a revised quote with additional inclusions including: "Timber framing and cladding work required for creating flush finish for motorised blinds." The second Jamieson report 1. In the second Jamieson report Mr Jamieson has costed construction at $2,055.00 and provided detailed calculations of his costing which includes 6 hours labour at $102.50 per hour. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to the 11 July 2017 quote, the 7 May 2017 at 9.45pm email and the costing of this item by Mr Jamieson in the second Jamieson report. The submissions of the builder 1. In the builder's 16 July 2021 submissions, the builder's 20 August 2021 submissions and his oral submissions the builder submitted that this item was not part of the contract scope of works, and referred to drawing DA.1003 of the PW plans drawings AKD-003 and AKD-004 of the AK specifications, the 11 July 2017 quote, and cl 33 of the special conditions. Consideration 1. I am not satisfied that external venetian recessing is specified in the 11 July 2017 quote. The 7 May 2017 at 9.45pm email has no relevance as it was not part of the contract. It follows that this item was not part of the contractual scope of works. Item 65 – B24 – allowance for Rinnal 26 with fluting The applicable contractual terms 1. The 11 July 2017 quote relevantly provides: "32 Plumbing Works … 32.2 Allowance made for Rinnal 26 with fluting" The first Mullally affidavit 1. In the first Mullally affidavit the owner has stated the builder suppled a Rinnal 26 without fluting. The first Lucien affidavit 1. In the first Lucien affidavit the builder in responding to the first Mullally affidavit said he was unable to complete the list of incomplete items because the contract was terminated. The joint building report 1. In the joint building report Mr Burton has stated that a Rinnal 26 with fluting has been fitted. The first Jamieson report 1. In the first Jamieson report Mr Jamieson has costed construction at $1,253.00 and provided some details of his costing. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to item 32.2 of the 11 July 2017 quote, and the costing of this item by Mr Jamieson in the second Jamieson report. 2. In the owner's 28 September 2021 submissions the owner referred to the evidence of the builder in the first Lucien affidavit, repeated the owner's 19 July 2021 submissions and submitted there was no evidence to the contrary. The submissions of the builder 1. In the builder's 29 September 2021 submissions the builder submitted that fluting is incorporated in the Rinnai hot water system, and accordingly this item is not incomplete work. 2. In the builder's 5 October 2021 submissions the builder referred to the evidence of Mr Burton In the joint building report. Consideration 1. I am satisfied that item 32.2 of the 11 July 2017 quote specifies a Rinnal 26 with fluting, and accordingly that this item was part of the contractual scope of works. 2. I am not satisfied that the owner has established that the builder failed to complete this item. In circumstances where the contrary evidence of Mr Burton In the amended scott schedule was not challenged in the concurrent oral evidence of the experts the owner has not discharged the burden of proving that this item was not completed. Item 66 – B25 - supply and install Clipsall Classic 2000 power points and Clipsall Classic 2000 power points with USB The applicable contractual terms 1. The 11 July 2017 quote relevantly provided: "35 Electrical Services 35.1 Supply and Install Clipsal Classic 2000 power points & Clipsal Classic 2000 power points with USB Mechs as per drawings AKD-005, AKD-006 & elevation drawings." …" The first Mullally affidavit 1. In the first Mullally affidavit the owner has stated that she supplied these items. The first Lucien affidavit 1. In the first Lucien affidavit the builder in responding to the first Mullally affidavit said he was unable to complete the list of incomplete items because the contract was terminated. The first Jamieson report 1. In the first Jamieson report Mr Jamieson has costed supply at $755.00 and provided the unit price of each type of power point. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to item 35.1 of the 11 July 2017 quote, the 7 May 2017 at 9.45pm email and the costing of this item by Mr Jamieson in the second Jamieson report. 2. In the owner's 15 September 2021 submissions the owner submitted that there is no evidence in support of the submission that the builder did the work of supplying and installing Clipsal power points, or that she changed her mind and upgraded some of the items. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder submitted that he completed these works and provided some of the items. The owner changed her mind and upgraded some of the items. 2. In the builder's 29 September 2021 submissions the builder submitted that his electrician had installed power points and left the Clipsal products on the site. Consideration 1. I am satisfied that item 35.12 of the 11 July 2017 quote specifies Clipsal power points, and accordingly that this item was part of the contractual scope of works. 2. I am also satisfied on the basis of the uncontradicted evidence of the owner that Clipsal power points were not supplied and that in the absence of any other evidence the reasonable cost of their supply is $755.00. Item 84 – Signature shutter & Blinds The applicable contractual terms 1. The 11 July 2017 quote relevantly provided: "46 Motorised Venetian Blind 46.1 Supply & fit motorised Venetian Hella AR92 for bedroom 1 only includes wind sensor & remote control" 1. Drawing AKD-002 of the AK specifications depicts on the plan two windows in bedroom 1: a sash window facing in an easterly direction, and a smaller window facing in an easterly direction below the skylight; a window in bedroom 2, and a window in the bathroom. This drawing includes in the notations under the heading "Bedroom 1" "4 pane vertical sashless window – top and bottom panes 2200mm high x 3000mm" and "motorised external venetian Hella AR92 (control next to bed)", and on the plan "Plantation shutter" adjacent to the smaller window in bedroom 1, the window in bedroom 2, and the window in the bathroom. 2. Drawing AKD-006 of the AK specifications has the same features as drawing AKD-001 of the AK specifications other than the heading Bedroom 1" and the notations under this heading. 3. Drawing AKD-008 of the AK specifications has the same features as drawing AKD-001 of the AK specifications other than the heading Bedroom 1" and the notations under this heading. The first Mullally affidavit 1. In the first Mullally affidavit, the owner gave the following evidence; 1. the incomplete works at the termination of the contract included shutters not installed (at [186(j)]; 2. she claimed completion costs of $1,926.00 for "Signature Shutter & Blinds" and attached the Tax Invoice no 1005628 dated 1 May 2019 of Signature Shutter and Blinds for $1,288.00 for the supply and installation of 2 shutters to bedroom 2 (the Signature invoice) (at [191]). The first Lucien affidavit 1. In the first Lucien affidavit, the builder gave evidence that shutters were not part of the contract scope of works (at 186(j)]. The oral evidence of the builder 1. In his oral evidence the builder was not cross-examined about the shutters. The oral evidence of the owner 1. In her oral evidence the owner was not cross-examined about the shutters. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to the applicable contract terms and her evidence, and submitted she is entitled to $1,170.91 for the supply and installation of shutters. She also submitted that cl 33 of the special conditions has no application. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder made the following submissions: 1. the contract did not allow for shutters, and the builder only allowed for a motorised venetian blind at item 46 of the 11 July 2017 quote; 2. drawings AKD-006 and AKD-008 of the AK specifications make no mention of the type, colour, size or quality of the shutters which are alleged by the owner to have been provided by him; 3. he relies upon cl 33 of the special conditions. Consideration 1. I am satisfied that the builder was required to supply and install plantation shutters in bedroom 1, bedroom 2 and the bathroom on the first floor by drawings AKD-002, AKD-006 and AKD-008. I do not consider that there is any relevant conflict between the AK specifications and the 11 July 2017 quote, and so cl 33 of the special conditions is not relevant to the determination of whether this item forms part of the contractual scope of works. The supply and installation of a motorised venetian blind in bedroom 1 was distinct from the supply and install of plantation shutters. 2. I am also satisfied that this work was not completed at the termination of the contract, and in the absence of any other evidence than in the Signature invoice the reasonable cost of the supply and install of plantation shutters is $1,170.91. Item 87 – Alan Tiling The applicable contractual terms 1. Drawing AKD-001 of the AK specifications depicts a "Green Wall" on the southern side of the dining room and includes in the notations under the heading "Dining Exterior" "tiled finish to floor and wall (Popham patterned tiles)". 2. Drawing AKD-002 of the AK specifications depicts an indented exterior wall above the dining room on the ground floor. 3. Drawing AKD-007 of the AK specifications contains the notation "CT-03" for the floor and wall tiles under the heading "Dining Exterior". Specification CT001 of the AK specifications specifies for the code "CT-00" "Decorative tile to exterior" for the "Item/Location", "Subject to site measurement" for "Quantity", "Popham tiles – 3 x custom coloured pinwheel design to be arranged randomly Finish: in custom colours, poppy, fog and kohl (measurements obscured)" for "Details/Description", "Refer to General Notes Site measure for installation Handmade Cement Tiles To be Sealed As Per Supplier Installation" for "Notes/Comments" and "Onsite Tiles" for "Supplier". 4. Drawing AKD-008 of the AK specifications does not contain the notation "CT-03". The first Mullally affidavit 1. In the first Mullally affidavit, the owner gave the following evidence; 1. the incomplete works at the termination of the contract included tiling in the laundry (at [186(f)]), and the lightwell (at [186(i)]); 2. she claimed completion costs of $3,080.00 for "Alans Tiles" and attached the Tax Invoice no 85 dated 23 May 2019 of Alan Tiling for $3,080.00 that contains no description of the work undertaken (the Alan Tiling invoice) (at [191]). The first Lucien affidavit 1. In the first Lucien affidavit, the builder gave evidence that the design of tiling in the laundry was changed by the owner and had not been completed at the termination of the contract (at [186(f)]), and tiling in lightwell was not part of the contract scope of works (at [186(i)]). The oral evidence of the builder 1. In his oral evidence the builder agreed the tiling on the laundry splash back was not finished and there was just a couple of tiles to go in around the cabinet because the owner "changed" (Tcpt, 21 May 2021, pp 32(44)-33(3)). The oral evidence of the owner 1. In her oral evidence the owner was not cross-examined about the tiling. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner made the following submissions: 1. she referred to the applicable contract terms and her evidence, and submitted she is entitled to $2,800.00 for the tiling in the lightwell, tiling in the laundry, and retiling the cistern wall after the toilet was removed and re installed at the correct height; 2. in variation # 12, the builder claimed $1527.91 for tiling the light well. The variation was not agreed and he did not carry out the work, but the amount he was prepared to charge was more than half what Alan's Tiling charged her for a larger scope of work. The submissions of the builder 1. In the builder's 20 August 2021 submissions, the builder's 29 September 2021 submissions and his oral submissions the builder made the following submissions: 1. the owner failed to provide tiling layouts and specifications of the tiles she required and as such he was unable to perform the works in accordance with cl 33 of the special conditions; 2. drawing AKD-007 of the AK specifications indicates the areas where the owner's design fails to provide a specification for the tiles to be provided by the owner and the tile layout. The contract does not provide details, and the 11 July 2017 quote excluded these tiling works; 3. the works were a variation to the contract and claimed by him in variation # 12 in the amount of $2,680.00. This variation was not approved by the owner and as such neither the variation nor this claim for alleged incomplete works which did not form part of the contract scope of works in any event, should be allowed. Consideration 1. I am satisfied that the code "CT-00" in specification CT001 of the AK specifications is a mistaken reference for the code "CT-03". 2. I am satisfied that tiling of the exterior of the southern side of the dining room on the ground floor was part of the contractual scope of works having regard to drawings AKD-001 and AKD-007 when read with specification CT001 of the AK specifications. Having regard to drawings AKD-002 and AKD-008 of the AK specifications the exterior of the southern side of the dining room on the ground floor had the function of a lightwell. This work was not completed at the termination of the contract. 3. The parties were agreed that tiling of the laundry was part of the contractual scope of works, and was not completed at the termination of the contract. 4. I am not satisfied that the incomplete works included retiling the cistern wall after the toilet was removed and re installed at the correct height as there was no evidence in support of the owner's submission. 5. The evidence of the owner of the cost of completing this incomplete is unsatisfactory as there is no breakdown or description of the work undertaken in the Alan Tiling invoice. In the absence of a breakdown I have deducted $800.00 of from this item and allowed $2,000.00 as the reasonable cost of the completion of the tiling. Item 88 – Simpco Cleaning The applicable contractual terms 1. The 11 July 2017 quote relevantly provided: "47 Cleaning 47.1 Final clean of site once construction has been completed and make ready for handover. (materials + Labour)"" The first Mullally affidavit 1. In the first Mullally affidavit, the owner gave the following evidence; 1. the incomplete works at the termination of the contract included the final clean (at [186(n)]); 2. she claimed completion costs of $2,915.00 for "Simpo cleaning" and attached the Tax Invoice no 3334 dated 20 May 2019 of Simpo cleaning for $2,915.00 that contains no description of the work undertaken except "After builder's clean as quoted" (the Simpo invoice) (at [191]). The first Lucien affidavit 1. In the first Lucien affidavit, the builder gave evidence that it not possible to undertake the final clean because the owner wrongly terminated the contract (at [186(n)]). The Lee report 1. In the Lee report Mr Lee expressed the opinion allowed $720.00 for the cost of final cleaning on the basis of 16 hours at $45.00 per hour. The oral evidence of the builder 1. In his oral evidence the builder was not cross-examined about the final cleaning. The oral evidence of the owner 1. In her oral evidence the owner was not cross-examined about the final cleaning. The concurrent oral evidence of the experts 1. In the concurrent oral evidence of the experts Mr Lee was not cross-examined about the final cleaning. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions, the owner's 28 September 2021 submissions and her oral submissions the owner referred to her evidence, and submitted she is entitled to $2,650.00 which she paid for the final cleaning. The submissions of the builder 1. In the builder's 20 August 2021 submissions, the builder's 5 October 2021 submissions and his oral submissions the builder made the following submissions: 1. he agreed that cleaning was incorporated into the contract price; 2. the Simpo invoice contains no detail as to how the $2,650.00 has been calculated, such as hourly rates or the number of hours spent by the cleaning company cleaning a small terrace house; 3. Mr Lee was available for cross-examination, and his evidence was not contested by the owner; 4. the builder offered $1,400.00 as recorded in the amended scott schedule. Consideration 1. The parties agreed that final cleaning was part of the contractual scope of works, and was not completed at the termination of the contract. 2. In the light of the unchallenged evidence of Mr Lee I not satisfied that the amount of $2,650.00 is a reasonable amount for undertaking final cleaning. In accordance with the opinion of Mr Lee I allowed $720.00 as the reasonable cost of the completion of the final cleaning. Item 89 - Touchwood Constructions The applicable contractual terms 1. Drawing DA.1001 of the PW plans which has the drawing title "Ground Floor Plan" depicts that the laundry is separated from the internal stairs and the bathroom, by walls marked in yellow which have the notation "new internal walls" including walls on each side of the laundry tub. 2. Drawing AKD-001 of the AK specifications depicts a "Laundry" which is adjacent to the internal staircase. This drawing includes in the notations under the heading "Laundry" "new storage – TBA on site maximum dimensions under staircase". It also depicts a sliding door between the laundry and the bathroom. 3. Drawing AKD-002 of the AK specifications depicts a sliding door between bedroom 2 and the walk in robe. 4. Drawing AKD-007 of the AK specifications contains the notation "PT-03" for the walls under the heading "Laundry". Specification PT001 of the AK specifications which has the heading "Paint" specifies for the code "PT-04" "interior wall colour" for the "Item/Location", and other details. 5. Drawing AKD-100 of the AK specifications depicts a cavity sliding wall. 6. Drawing AKD-116 of the AK specifications depicts options A and B for "Continuous Handrail Profile". Option B depicts the handrail on top of plasterboard and includes the note: "This handrail will not be BCA compliant due to building out the existing stair walls making it narrower than 900mm." The first Mullally affidavit 1. In the first Mullally affidavit, the owner gave the following evidence: 1. the incomplete works at the termination of the contract included the recessed handrail for the internal stairs not having been installed (at [186(d)]), doors under stairs not having been fitted (at [186(e)]), and painting not having been finished (at [186(m)]); 2. she claimed completion costs of $10,065.00 for "Touchwood Constructions" and attached the Tax Invoice reference PEAR101 dated 3 June 2019 of Touchwood Constructions (Touchwood) for $10,065.00 that contains a list of items" (the Touchwood invoice) (at [191]): "This invoice includes only what is listed below: • Install recessed hand rail in gyprock wall and on top of upper wall $3,900. • Fix magnet catch $50. • Gyprock and frame walls in the laundry $1400. • Replace damaged gyprock ceiling in the upstairs bathroom with aqua check $1200. • Cavity slider door white on both sides $200. • Cavity slider door and running guides and push pull handle $150. • Caulk the gaps around shelves $50. • Adjust front door striker $50. • Install door handle and strike $50. • Repair front window that didn't open $50. • Install new window lock $100. • Cavity slider door and running guides and push pull handle in laundry $150. • Install 2 doors under stairs $400. • Install side wall next to laundry tub $300. • Painting walls and doors under stairs $300. • Remove ac grill $50 . • Paint sewer pipe vent $50. • Floor protection $200 • Removal of tiles and new sheeting to have the toilet raised up $300. • Extra paint needed for internal works as the old cans ran out = $200." The first Lucien affidavit 1. In the first Lucien affidavit, the builder gave the following evidence: 1. the recessed handrail for the internal stairs was a variation for which the design had been finalised, and not part of the contract scope of works (at [186(d)]); 2. the doors under the stairs were not part of the contract scope of works (at [186(e)]); 3. he denied the painting was not finished, at best a few touches may have been required, as part of the normal defects list, which he did not get to do because the owner had wrongfully terminated the contract (at [186(m)]). The oral evidence of the builder 1. In his oral evidence the builder gave the following evidence: 1. he agreed that he had not installed a handrail on the stairs that he had built (Tcpt, 21 May 2021, pp 33(50)-34(1)); 2. he disagreed that the recessing of the handrail for the internal stairs was the obvious solution and said it was not feasible due the fact that the single cavity brick into which the handrail was recessed would crack. He needed details from the owner (Tcpt, 21 May 2021, pp 87(27)-88(4)); 3. he said that he repaired the ceilng in the bathroom (Tcpt, 21 May 2021, p 63(23)-(45)). The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to the applicable contract terms and her evidence, and submitted she is entitled to $9,100.00 for the items in the Touchwood invoice other than $50.00 for the removal of the air con grill. The submissions of the builder 1. In the builder's 16 July 2021 submissions, the builder's 20 August 2021 submissions and his oral submissions the builder made the following submissions about the items in the Touchwood invoice: 1. fix magnet catch ($50.00): this item was not part of his scope of works, and the owner has not indicated where in the contract this item emanates from; 2. gyprock and frame wall in the laundry ($1,400.00): these works were not part of his scope of works, and relate to variation # 13, which the owner disputes. The laundry works were completed and after completion the owner sought a change which resulted in variation # 13, which she has not approved and disputes. Despite this she now claims for the costs of completing the varied works; 3. replace damaged gyprock ceiling in the upstairs bathroom with aqua check ($1,200.00): This would be a defect which would have been attended to during the defect's liability period; 4. cavity slider door white on both sides ($200.00): the owner has failed to indicate where this item is in the contract, and it is not part of his scope of works; 5. cavity slider door and running guides and push pull handle ($150.00): the owner wrongfully terminated the contract before he was able to complete these works; 6. caulk gap around shelves ($50.00): this item is a minor defect, and the amount claimed is excessive and unreasonable. The owner wrongfully terminated the contract before the defect's liability period arose, or the builder was able to complete the works; 7. adjust front door striker ($50.00): this item is a minor defect, and the amount claimed is excessive and unreasonable. The owner wrongfully terminated the contract before the defect's liability period arose; 8. install door handle and strike ($50.00): this item is a minor defect, and the amount claimed is excessive and unreasonable. The owner wrongfully terminated the contract before the defect's liability period arose, or the builder was able to complete the works; 9. repair front window that didn't open ($50.00): the window was existing and was not part of his scope of works. The owner has failed to identify where this item arises in the contract; 10. install new window lock ($100.00): the window was existing and was not part of his scope of works. The owner has failed to identify where this item arises in the contract; 11. cavity slider door and running guides and push pull handle in laundry ($150.00): this item is a minor defect, and the amount claimed is excessive and unreasonable. The owner wrongfully terminated the contract before the defect's liability period arose, or the builder was able to complete the works; 12. install 2 doors under the stairs ($400.00): the owner has failed to indicate where this item is in the contract, and it is not part of his scope of works; 13. install side wall next to laundry tub ($300.00): the owner has failed to indicate where this item is in the contract, and it is not part of his scope of works; 14. painting walls and doors under stairs ($300.00): the owner has failed to indicate where this item is in the contract, and it is not part of his scope of works; 15. remove ac grill ($50.00): the owner has withdrawn this item; 16. paint sewer pipe vent ($50.00): the owner has failed to indicate where this item is in the contract, and it is not part of his scope of works; 17. floor protection ($200.00): he had previously provided floor protection, and no explanation is provided as to why this item is required and for what purpose it was used and when; 18. removal of tiles and new sheeting to have the toilet raised up ($300.00): the works were performed by him to the manufacturer's instructions; the owner approved the location of the toilet prior to it being installed and has now changed her mind. The builder should not be responsible for the design change sought by the owner after the works were completed and in circumstances where the owner wrongfully terminated the contract and has changed her mind about the location of the toilet; 19. extra paint needed for internal works as the old cans ran out ($200.00): no explanation, or detail as to what external works were performed which required the extra paint is provided by the owner; the tin of paint is alleged to have costs exactly $200, with no evidence substantiating this item. Further and in the alternative the ongoing provision of paint was not part of his scope of works. The owner is seeking $649.00 for painting by Denman Painting and Wallpaper Pty Ltd, which presumably would have been undertaken by the licenced painter, not Touchwood. The submissions in reply of the owner 1. In the owner's 15 September 2021 submissions the owner replied to the builder's 16 July 2021 submissions: 1. there is no evidence to the effect that the builder provided a handrail and the submission is contrary to the evidence of the builder. Nor is there any evidence to support the submission that "the owner changed her mind and requested a recessed handrail". There is no evidence that the builder held an opinion that a recessed handrail was not compliant with the BCA. The builder claimed the handrail could not be recessed because the wall was masonry. Touchwood has recessed the handrail into a gyprock wall and the joinery detail shows a plasterboard wall; 2. in respect to the other items, her evidence that such items are part of the scope of works should be accepted; 3. fix magnet catch ($50.00): the builder installed joinery with magnet catches; 4. gyprock and frame wall in the laundry ($1,400.00): this work did not relate to variation # 13. The laundry was required to be framed and sheeted with plasterboard in common with the rest of the new work as shown on drawing DA.1001 of the PW plans; 5. replace damaged gyprock ceiling in the upstairs bathroom with aqua check ($1,200.00): the owner was entitled to have the ceiling replaced because it was damaged and was not Aquacheck as specified in the contract; 6. cavity slider door white on both sides ($200.00): this door is shown on drawing AKD-002 of the AK specifications as the door from bedroom 2 to the walk in robe; 7. cavity slider door and running guides and push pull handle ($150.00): the owner had the work done by Touchwood and is entitled to recover what was spent; 8. caulk gap around shelves ($50.00): there is no evidence that the amount of $50.00 for this item is excessive; 9. adjust front door striker ($50.00): there is no evidence that the amount of $50.00 for this item is excessive; 10. install door handle and strike ($50.00): there is no evidence that the amount of $50.00 for this item is excessive; 11. repair front window that didn't open ($50.00): the front window was an existing window. It was painted by the builder. Touchwood repaired the window after painting; 12. install new window lock ($100.00): Touchwood installed a new window lock at a cost of $100.00; 13. cavity slider door and running guides and push pull handle in laundry ($150.00): the cavity slider door is shown on drawings AKD-001 and AKD-100 of the AK specifications as the door between the ground floor bathroom and the laundry. There is no evidence that the amount of $150.00 for this item is excessive; 14. install 2 doors under the stairs ($400.00): the doors under the stairs are shown on drawing AKD-001 of the AK specifications; 15. install side wall next to laundry tub ($300.00): new framed and gyprocked walls are shown alongside the tub on drawing DA.1001 of the PW plans; 16. painting walls and doors under stairs ($300.00): drawing AKD-007 of the AK specifications shows painting in the laundry; 17. paint sewer pipe vent ($50.00): the builder does not deny that this item is part of the contract works; 18. floor protection ($200.00): the work carried out by Touchwood was after termination, but whoever carried out the work would have required floor protection; 19. removal of tiles and new sheeting to have the toilet raised up ($300.00): the builder has agreed to item 95 for the plumbing work involved in raising the toilet; 20. extra paint needed for internal works as the old cans ran out ($200.00): the builder does not say how much paint was left on site and why it would have been sufficient for the range of painting tasks carried out by Touchwood. Consideration 1. I am not satisfied that the following items were part of the contractual scope of works as they are not shown of any of the contract documents: 1. joinery with magnet catches; 2. the front window; 3. the installation of a new window lock; 4. doors under the stairs in the laundry; 5. painting of doors under the stairs in the laundry; 6. painting of the sewer pipe vent. 1. I am satisfied that the following items were part of the contractual scope of works and had not been completed by the builder at the time of the termination of the contract: 1. gyprock and frame wall in the laundry as shown on drawing DA.1001 of the PW plans; 2. a cavity slider door white between bedroom 2 and the walk in robe as shown on drawing AKD-002 of the AK specifications; 3. side wall next to laundry tub as shown on drawing DA.1001 of the PW plans; 4. painting of walls under the stairs in the laundry as shown on drawing AKD-007 when read with specification PT001of the AK specifications; 1. I am not satisfied that Touchwood was unable to use the floor protection which had been provided by the builder, or required paint in addition to that left on site by the builder. I am not satisfied that the owner has established that the removal of tiles and new sheeting to have the toilet raised up was incomplete works and the builder has conceded this item by reason of conceding item 95. 2. In the absence of any contrary evidence by the builder I am not satisfied that any of the amounts charged by Touchwood for these items was unreasonable because it was excessive. 3. The fact that the owner terminated the contract is no answer to the entitlement of the owner to recover the cost of incomplete work. 4. In the absence of any breakdown of the cost of painting of the doors and walls under the stairs in the laundry I have allowed $150.00 for each of the components. 5. Having regard to my findings I have allowed $7,650.00 for this item. Item 90 – Denman painting and wallpaper The applicable contractual terms 1. The 11 July 2017 quote does not contain any provision about the wall coverings in the dining room on the ground floor and bedroom 2 on the first floor. 2. Drawing AKD-001 of the AK specifications includes the notation "feature wall paper at side board wall" under the heading "Dining". 3. Drawing AKD-002 of the AK specifications includes the notation "decorative wall paper to bed head wall" under the heading "Bedroom 2 & WIR". 4. Drawing AKD-007 of the AK specifications contains the notation "WC-01 Behind Console" for the feature wall under the heading "Dining". Specification WC001 of the AK specifications specifies for the code "WC-01" "Wallpaper at Dining feature wall" for the "Item/Location", and other details. 5. Drawing AKD-008 of the AK specifications contains the notation "WC-02" for the feature wall under the heading "Bedroom 2". Specification WC001 of the AK specifications specifies for the code "WC-02" "Wallpaper at bedroom 2" for the "Item/Location", and other details. The first Mullally affidavit 1. In the first Mullally affidavit, the owner gave the following evidence: 1. the incomplete works at the termination of the contract included wallpaper (at [186(o)]); 2. she claimed completion costs of $836.00 for "Denman Painting & Wallpaper" and attached the Tax Invoice dated 4 June 2019 of Denman Painting & Paperhanging Pty Ltd (Denman) for $836.00 for "Paper Hanging and Adhesive" (the Denman invoice) (at [191]). The Lucien witness statement 1. In the Lucien witness statement the builder gave evidence that on 16 May 2017 at 10.07pm he sent an email to the owner in which he stated he had a revised quote from which he had removed various items including wall paper (the 16 May 2017 at 10.07pm email) (at [7]). The first Lucien affidavit 1. In the first Lucien affidavit, the builder gave evidence that wall paper was not part of the contract scope of works (at [186(o)]). The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to the applicable contract terms and her evidence, and submitted she is entitled to $760.00 which she paid for the wallpaper. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder submitted that wallpaper was expressly excluded from the contract and relied on cl 33 of the special conditions. 2. In the builder's 29 September 2021 submissions the builder submitted that wallpaper was expressly excluded from the contract and relied on the 16 May 2017 at 10.07pm email. Consideration 1. I am satisfied that the builder was required to supply and install wallpaper in the dining room on the ground floor and bedroom 2 on the first floor by drawings AKD-001, AKD-002, AKD-007 and AKD-008 of the AK specifications. I do not consider that there is any relevant conflict between the AK specifications and the 11 July 2017 quote, and so cl 33 of the special conditions is not relevant to the determination of whether this item forms part of the contractual scope of works. Further, the 16 May 2017 at 10.07pm email was not part of the contract. 2. I am also satisfied that this work was not completed at the termination of the contract, and in the absence of any other evidence than in the Denman invoice the reasonable cost of the supply and install of wallpaper is $760.00. Item 92 – Slabs by design The applicable contractual terms 1. The 11 July 2017 quote does not provide for the supply and installation of a concrete bench seat, a BBQ base and a BBQ benchtop in the rear yard. 2. Sheet 2 of the BSG plan depicts the location of a table, three seats, and a barbeque, and contains the notation "R.F Polished Concrete Bench 75mm Top". The first Mullally affidavit 1. In the first Mullally affidavit, the owner claimed completion costs of $8,330.00 for "Slabs by design" and attached the Tax Invoice no INV-0267 dated 14 June 2019 of Slabs by design for $8,330.00 for 4 items: outdoor concrete bench seat - $1,330.00 20mm slab with a 60mm profile edge including custom stainless steel brackets in powder coat finish $300.00; BBQ benchtop - $3,450.00 (20mm slab with a 60mm profile edge and waterfall sides); site measure, delivery and installation - $850.00; BBQ concrete base unit - $2,700.00 (the Slabs by design invoice) (at [191]). The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to the applicable contract terms and her evidence, and submitted she is entitled to $7,572.73 which she paid for a concrete bench seat, a BBQ base and a BBQ benchtop. The submissions of the builder 1. In the builder's 20 August 2021 submissions, the builder's 29 September 2021 submissions and his oral submissions the builder submitted that these items were not included in the 11 July 2017 quote and are not part of the contract scope of works, and relied on cl 33 of the special conditions. Consideration 1. I am not satisfied that the builder was required to supply and install a concrete bench seat, and BBQ base. While sheet 2 of the BSG plan depicts the location of three seats and a BBQ, it does not specify the supply and installation of these items in concrete. 2. I am satisfied that the builder was required to supply and install a concrete BBQ benchtop as depicted on sheet 2 of the BSG plan. I do not consider that there is any relevant conflict between the AK specifications and the 11 July 2017 quote, and so cl 33 of the special conditions is not relevant to the determination of whether this item forms part of the contractual scope of works. However, the BBQ benchtop does not include waterfall sides or a profile edge. 3. In the absence of a more detailed breakdown in the Slabs by design invoice I have allowed $1,136.36 for this item, being $909.09 for the benchtop and $227.27 for site measure, delivery and installation. The amount of $909.09 for the benchtop is the same amount as charged for the concrete bench seat after deducting the cost of the custom stainless steel brackets. Item 93 – Bay Street Gardens The applicable contractual terms 1. The 11 July 2017 quote does not provide for the supply and installation of mirrors in the rear yard, and relevantly provided: "37 Landscaping 37.1 Landscaping area no plants have been allowed." 1. Sheet 2 of the BSG plan contains the notation "Antiqued Mirror". The correspondence between the parties 1. On 16 August 2018 at 1.39pm, the builder in an email to the owner (the 16 August 2018 at 1.39pm email) relevantly stated: "3) Front Tap reconnected: I will get plumbers on to it next week even if we cant connect mains water I will run temporary hose any damage to plants will be replaced." The first Mullally affidavit 1. In the first Mullally affidavit, the owner claimed costs of $5,203.00 for "Bay Street Gardens replant front yar" and attached the Tax Invoice # 7731 dated 18 June 2019 of Bay Street Gardens for $17,075.85 for 4 items: including "Front To Do: Supply & Install" for 97 plants, "Antique Mirror To Do: Supply & Install" for two mirrors with polished edge - $3,540.00 (1900mmL x 600mmH -$980.00; 2000mmL x 2100mmH -$2,560.00 (the BSG invoice) (at [191]). The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to the applicable contract terms and her evidence, and submitted she is entitled to $7,110.00, being $3,570.00 for the cost of replacing plants in the front yard, and $3,540.00 for the cost of mirrors. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder made the following submissions: 1. so far as plants in the front yard, said he replaced some existing plants which were damaged during the works, and denied that he is liable for the further plants sought by the owner; 2. so far as mirrors, he did not allow for mirrors in 11 July 2017 quote and they did not form part of the contract scope of works. They are expressly excluded pursuant to cl 33 of the special conditions. Consideration 1. I am not satisfied that the owner has established that the builder damaged any plants in the front yard. The BSG invoice does not establish that plants to be planted in the front yard were to replace plants which had been damaged by the builder. The 16 August 2018 at 1.39pm email does not contain any admission by the builder that he had damaged any plants in the front yard. 2. I am not satisfied that the builder was required to supply and install mirrors in the rear yard. While sheet 2 of the BSG plan depicts the location of a mirror, it does not specify the supply and installation of a mirror or two mirrors. Conclusion 1. Having regard to the agreed position of the parties and my findings I am satisfied that: 1. the owner is entitled to the reasonable amount to complete incomplete work for items 39, 40, 42 to 44, 46, 47, 49 to 59, 62 to 64, 66 to 73, and 82 to 92; 2. the reasonable cost to complete these items is $49,511.54 exclusive of GST and $54,462.70 inclusive of GST. 1. It follows that the owner is entitled to a money order in the sum of the sum of $54,462.70 inclusive of GST by way of damages under s 48O(1)(a) of the HB Act which I have found to be the reasonable amount to complete the incomplete work. Whether the owner paid for work to be undertaken by the builder, and if so is entitled to restitution of the amount paid Introduction 1. The parties reached agreement as to the items in the amended scott schedule to which the owner was entitled to a credit, and the amount of the credits: 1. item 77 – credit for Hella blind: $6,810.00; 2. item 78 – credit for carpet: $6,545.45. 1. By reason of the agreed position of the parties set out at [28(4)] and [429] above it is only necessary to determine the items that remain in dispute. 2. The builder made submissions relating to items 87, 90 and 92 of the amended scott schedule that the owner had admitted that these items were not part of the contractual scope of works in the third Mullally affidavit. I have not dealt with these submissions in the context of each of these items because there has been no such admission by the owner by reason of this affidavit not having been received into evidence. In any event, the question of whether any items are part of the contractual scope of works involves the construction of the contract and is not answered by reference to the subjective view of the owner. Items 74 and 75 – Volar screens 50%contributionand other 50%contribution The applicable contractual terms 1. Clause 1 of the general conditions relevantly provided: "Contract documents … In the event of any difference or inconsistency between the above documents, the contractor must discuss the matter with the owner and attempt to seek agreement on the work to be performed or the materials to be used. … All items shown in the plans form part of the work to be performed under this contract unless specifically excluded by the contract conditions, including any additional conditions, specifications or other documents listed above. Items listed in the Excluded items schedule (opposite) are not included in this contract. The Schedule should be completed or marked 'Not Applicable'. If the Excluded items schedule is not completed it will be deemed to be not applicable. Exluded items schedule (items not included in contract) Asbestos All other exclusions as per quote" 1. The expression "the above documents" in cl 1 of the general conditions refers to the documents set out at [7] above. 2. Clause 13 of the general conditions relevantly provided: "Variations … Procedure for variations Before commencing work on a variation, the contractor must provide to the owner a notice in writing containing a description of the work and the price (including GST). If not otherwise specified the price will be taken to include the contractor's margin for overheads, supervision and profit. The notice must then be signed and dated by both parties to constitute acceptance. …" 1. In the owner specifications the item "Centor ES2 Retractable Screen" has been struck through, and initialled on behalf of the builder. The two pages of the owner specifications have been initialled at the bottom of the page by the owner and on behalf of the builder. 2. The AK specifications did not include a window schedule. The correspondence between the parties 1. On 29 October 2018 at 4.46pm, the builder in an email to the owner (the 29 October 2018 at 4.46pm email) relevantly attached variation # 9 claiming $7,617.50 for "Centor retractable fly screens". 2. On 29 October 2018 at 6.08pm, the owner sent an email to the builder in which she responded to the 29 October 2018 at 4.46pm email as follows: "Is this a joke? 1. As previously stated to you (on many occasions). The Cantor screens were always part of the job and If you removed them from the quote in order to compete with Riverside (who had included them) you did so without my knowledge or approval. 2. I draw your attention to the exclusion in the contract NOT being initialled by me. 3. Furthermore, I provided you with a substantially cheaper quote from Volar Screens being for $6094, than you had procured. 4. You are requesting a variation for $7617.50. Makes no sense to me whatsoever" 1. On 21 November 2018 at 4.54pm, the builder in an email to the owner (the 21 November 2018 at 4.54pm email) relevantly stated: "I will send you a refund variation for flooring and fly screens and deduct the cost of your next progress payment." 1. On 21 November 2018 at 8.47pm, the owner sent an email to the builder in which she responded to the 21 November 2018 at 4.54pm email (the 21 November 2018 at 8.47pm email) as follows: "Don't include a refund for the flyscreens because I only paid 50% of the invoice." The first Mullally affidavit 1. In the first Mullally affidavit, the owner gave the following evidence: 1. she had the following conversation with the builder in November 2018: "Builder: "The Center screens are not included." Me: "We will have to agree to disagree because I think they are. How about we divide the costs of the Volar screens equally?'' Builder: "No." Me: "Come on mate. 1 don't want to pay either, but we have to try and move forward.'' Builder: "60/40.'' Me: "No, 50/50." Builder: "OK." 1. the cost of the Volar Screens was $6,094.00 (including GST). She paid the first 50% deposit of $3,047.00 on or about 15 November 2018. The total cost of both screens was $6,094.00 (including GST). The first Lucien affidavit 1. In the first Lucien affidavit, the builder gave the following evidence: 1. he agreed with the owner's version of the conversation in [441(1)] above including the following additional exchange: "Nerida said: "Just pay the 50% pay half and it all goes away. I said: "OK, if all the issues we are having with you on site go away, I will accept 50%, if they don't then I'm not deducting 50% from the contract price." 1. he said It was his understanding from this conversation with the owner, that if he agreed to pay 50% of the screen price, she would not keep raising issues with our works or create problems in relation to the progress of the works and other matters, so on that basis only he agreed to for half of the prove of the screens. If the owner did not, not create further issues then, he would not be paying for the 50% of the screens, which ultimately was the case. The oral evidence of the builder 1. In his oral evidence the builder was not cross-examined about his conversation with the owner. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner made the following submissions: 1. the parties did discuss the inconsistency between cl 1 of the general conditions and the owner specifications; 2. the 21 November 2018 at 8.47pm email was sufficient confirmation in writing of the description of the work and the price, and was an agreed variation to supply the Volar screens at a cost of $2,770.00 to the owner. The submissions of the builder 1. In the builder's 20 August 2021 submissions, the builder's 29 September 2021 submissions and his oral submissions the builder made the following submissions: 1. these items were not part of the contractual scope of works as it was deleted from the owner specifications; 2. there was an attempted agreement sought by the owner (which is evidence of itself that the owner was aware the item did not form part of the contractual scope of works) for each party to pay half the costs of this item, however that agreement was rescinded by the owner by her conduct; 3. there was no written variation in accordance with cl 13 of the general conditions was provided or approved by the owner in writing. Consideration 1. I am not satisfied that there was any difference or inconsistency between any the documents set out at [7] above. These documents are consistent in having no reference to the builder supplying and installing Centor retractable fly screens. 2. I am not satisfied that there was a variation within cl 13 of the general conditions constituted by the 21 November 2018 at 4.54pm email because there was no notice signed and dated by both the owner and the builder. 3. I am not satisfied that the owner has established that she reached an agreement with the builder that they would share the cost of the supply Centor retractable fly screens. The builder was not cross-examined about his conversation with the owner in which the agreement was allegedly made. Further, the owner did not make any claim for rectification of the contract. 4. It follows that this item was not part of the contractual scope of works and so the builder is not liable for $5,540.00 claimed by the owner. IItem 76 – credit for laying bathroom tiles The applicable contractual terms 1. The 11 July 2017 quote relevantly provided: "26 Tiling labour 26.1 Laying only of floor & wall tiles as per specs includes all glue & grouting. …." 1. Drawings AKD-001 and AKD-002 of the AK specifications contain the notation "Stone tiles to floor" for the bathroom on each of the ground and first floors. Drawings AKD-007 and AKD-008 of the AK specifications contain the notation "ST-01" for the finishes for the floor of the bathroom on each of the ground and first floors. Specification ST001 of the AK specifications for the code "ST-1" specifies "Travertine vein cut at the bathroom and laundry doors" for the "Item/Location", "Subject to site measurement" for "Quantity", "Roman or Silver travertine TBA based on slab selection. Finished: honed and filled. Dimensions: Thickness 20mm" for "Details/Description", "To be sealed with penetrating sealer as per supplier recommendations" for "Notes/Comments" and "Granite and Marble Works" for "Supplier". The first Mullally affidavit 1. In the first Mullally affidavit, the owner gave the following evidence: 1. on or about 27 November 2018 she paid GMW the amount of $14,931.40 (including GST) in payment of the GMW Tax Invoice no 00016687 dated 23 November 2018 for the supply and laying the stone tiles in the bathrooms (the GMW invoice); 2. she exhibited the email GMW sent to her on 24 January 2019 at 5.16pm an email (the 24 January 2019 at 5.16pm email) which explained the GMW invoice breakdown as screeding in the amount of $1,540.00 (including GST), laying in the amount of $6,314.00 (including GST), and sealing in the amount of $1,379.50 (including GST). The Lucien witness statement 1. In the Lucien witness statement the builder gave evidence that on 16 July 2018 at 8.58pm the owner sent an email to him in which she stated that they needed to have a discussion about issues, including the bathroom floors and the laundry would be a slab of travertine 20mm thick and would be laid on site by the manufacturer (the 16 July 2018 at 8.58pm email) (at [20]). The oral evidence of the builder 1. In his oral evidence the builder differentiated between slabs and tiles (Tcpt, 21 May 2021, p 86(4)-(36)). The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions and her oral submissions the owner referred to the applicable contract terms and her evidence, and submitted she is entitled to $8,394.00 for the laying of tiles. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder made the following submissions: 1. he is not liable for this item or the amount sought as he only allowed for the laying of floor tiles, not stone, which is a further specialised trade, and would normally be undertaken by the stone supplier or its agent from whom the owner purchased her stone; 2. he conceded an allowance of $454.00 for the tiles not laid in this area, but disputes that the owner is entitled to the $7,854.00 sought for specialist laying of stone slabs, which she was required to provide; 3. drawings AKD-001 and AKD-002 of the AK specifications do no more than state: "Stone tiles to floor'' no reference to Travertine vein cut at the bathroom and laundry doors is specified, neither is the thickness, colour or the quality of the stone; 4. he relied upon cl 33 of the special conditions. Consideration 1. I am satisfied that drawings AKD-001, AKD-002, AKD-007 and AKD-008, and specification ST001 of the AK specifications when read together required the builder to lay stone bathroom tiles supplied by the owner from GMW. Clause 33 of the special conditions has no operation as there is no inconsistency between the 11 July 2017 quote and the AK specifications. On the contrary, the 11 July 2017 quote by the words "as per specs" indicated that scope of the tiling for floors was specified in the AK specifications, which in turn specified "Stone tiles to floor" for the bathroom on each of the ground and first floors. Further, I am satisfied that the 16 July 2018 at 8.58pm email constituted a variation of the contract. This email refers to the need for a discussion about issues including the floors of the two bathrooms and the laundry. There is no evidence that any such discussion took place. 2. As the builder did not lay the stone tiles in the floor of the bathroom on each of the ground and first floors I am satisfied that the owner is entitled to $8,394.00 being the amount in the GMW invoice referable to the laying of the tiles. Item 79 – credit for supplying front door The applicable contractual terms 1. Clause 11 of the general conditions relevantly provided: "Prime cost items schedule … The owner must select each item … … Prime cost items schedule Item As per [the 11 July 2017 quote] 1. Clause 19 of the general conditions relevantly provided: "Access to site and materials handling … The contractor must bear all costs involved in the delivery of materials to the work, … … 1. The 11 July 2017 quote relevantly provided: "41 Prime Cost/Provisional Sums ... 41.2 PC Allowance Front Door $800." 1. Drawing AKD-001 of the AK specifications contains the notation "Cricket bat with centre door pull from Sydney Woodworkers Doors & Window warehouse". The correspondence between the parties 1. On 22 October 2018 at 10.50am, the owner sent an text message to the Mr Tengstrom with a photograph depicting the top half of a door with two glass panels and the accompanying caption "Front door model no EA02BW3" (the 22 October 2018 at 10.50am text). 2. On 23 October 2018 at 2.45pm, the owner sent an text message to the builder with a photograph depicting the top half of a door with two glass panels and the accompanying caption "This is the design of the front door I picked at doors plus. model no EA02BW3. Just need clear glass clam hush for the transom" (the 23 October 2018 at 2.45pm text). The first Mullally affidavit 1. In the first Mullally affidavit, the owner gave the following evidence: 1. on or about 29 January 2019 the builder supplied a front door which she photographed and was different to the door in the 22 October 2018 at 10.50am text and the 23 October 2018 at 2.45pm text by reason of not having a cricket bat feature in the two panels in the bottom half of the door (at [291]); 2. she re-selected, supplied and photographed a door with a cricket bat feature in the two panels in the bottom half of the door, which the builder installed on or about 6 April 2019 (at [293]); 3. she claimed a refund of $1,032.00 for "Sydney Woodworkers" and attached the Tax Invoice no 00050384 dated 12 March 2019 of Sydney Woodworkers Warehouse for $1.032.00 which includes $100.00 for delivery (the SWW invoice) (at [191]). The first Lucien affidavit 1. In the first Lucien affidavit, the builder gave the following evidence: 1. the owner instructed him to purchase and install the door in [465(1)] above and referred to the 23 October 2018 at 2.45pm text; 2. the door in [465(2)] above was the third door the owner had selected. The oral evidence of the builder 1. In his oral evidence the builder said he purchased the door that the owner requested from Doors Plus and fitted it (Tcpt, 21 May 2021, pp 46(49)-47(39)). The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions, the owner's 28 September 2021 submissions and her oral submissions the owner referred to the applicable contract terms and her evidence, and submitted she is entitled to $890.91 for the front door, being the total of the PC allowance of $800.00 and the delivery fee of $90.91. The submissions of the builder 1. In the builder's 20 August 2021 submissions, the builder's 29 September 2021 submissions, the builder's 5 October 2021 submissions and his oral submissions the builder made the following submissions: 1. he purchased a front door which had been agreed to by owner for an amount of $880.00 The owner then changed her mind after seeing the door once it had been installed and then asked for a different door; 2. the owner's claim should be rejected as it results from her change of mind after the door was purchased and installed by him. Consideration 1. I am not satisfied that the owner has established that the front door supplied by the builder on or about 29 January 2019 differed from the photograph of the door in the 22 October 2018 at 10.50am text and the 23 October 2018 at 2.45pm text. As the photographs in these texts do not depict the bottom half of the door there is no way of deciding whether there was a difference in the doors as alleged by the owner. It follows that the owner is not entitled to a credit for this item. Item 80 – credit for Vola flush plates supplied but not installed The applicable contractual terms 1. Drawing AKD-105 of the AK specifications includes the notation "BA-14" for the bathroom on the ground floor. Drawing AKD-106 of the AK specifications contains no equivalent notation for the bathroom on the first floor. Specification BA001 of the AK specifications for the code "BA-14" specifies "flush plate at both bathrooms" for the "Item/Location", "2" for "Quantity", "Name: Vola mechanical dual actuator plate, Code: A85-40, Finish: Brushed SS" for "Details/Description". The correspondence between the parties 1. On 17 March 2019 at 10.15pm, the owner sent an email to the builder and Mr Wilkinson, which was copied to her solicitor Hannah Shephard (Ms Shephard), with the subject "Toilet dual flush plate" as follows: "I was advised by the site foreman on Thursday 14 March 2019 that the specified Vola ASS mechanical dual actuator plate in brushed stainless steel could not be installed. Upon investigation it is apparent that you did not provide the minimum built in depth of 35mm as required to fit the Vola flush plate. This is extremely disappointing: • The bathroom fittings were specified by AKO are were already part of the contract. • All the tap ware in the bathroom is Vola, and an alternative brand will not match • The Vola flush plate is extremely thin, nothing in the market is as thin. Please supply Geberit Sigma 70 Dual Flush Button 80mm Brushed stainless steel (Product code 1811559)." 1. On 25 March 2019 at 2.15pm, the builder sent an email to the owner, which was copied to Mr Wilkinson and Ms Shephard, with the subject "Toilet dual flush plate" relevantly as follows: "We have installed the Gerberit concealed cisterns as per there specifications. As you can see below from Morris's email (Metro Pipes Plumbing) it can only be set in one way there is no adjustment with these units. Gerberit also recommend installing Gerberit Flush buttons as these are fully compatible with the Gerberit brand of products and not as you suggested below (highlighted in red). We have used wall tiles as per specification document by AKD July 2016 as all this information was supplied by AKD and during the construction process we have attempt to consult with AKD who on all accession declined to assist as they said it was not part of their brief. On the documentation package specifications it also clearly states that Client is to ensure/confirm fixtures & fittings requested are compatible with layout & configuration required prior to ordering. Greg has also spoken and meet your supplier Dominic from Sydney Taps who confirmed the concealed cisterns are in fact set correctly and that he will exchange your Vola flush buttons for Gerberit Flush 560 buttons and reimburse you the cost difference. …" 1. On 25 March 2019 at 9.27pm, the owner sent an email to the builder and Mr Wilkinson, which was copied to Ms Shephard, with the subject "Toilet dual flush plate" as follows: " … Firstly, I confirm that the Gerberit concealed cistern has been installed correctly and the wall tiles used were supplied by me in accordance with the AKD specification. The only reason the Vola flush plate does not fit is because you did not install the specified 13mm Aquachek wall lining and instead installed 6mm Villaboard. This did not provide the requisite wall thickness to be able to install the Vola flush plate. … The first Mullally affidavit 1. In the first Mullally affidavit, the owner gave the following evidence (at [192(c)]): 1. the flush plates she supplied could not be used as the builder used villaboard instead of 13mm gyprock; 2. she re-supplied alternative flush plates to fit at a total cost of $2,432.00 for $1,216.00 each inclusive of GST and the builder took the original flush plates with him when he left the site; 3. she claimed a refund of $2,432.00 for "Vola flush plates x 2" and attached the Tax Invoice no 606054390 dated 15 April 2019 of Reece Australia Pty Ltd for $1,210.00 for 2 Gerberit buttons (the Reece invoice). The first Lucien affidavit 1. In the first Lucien affidavit, the builder gave the following evidence (at [192(c)]): 1. while the contract did specify 13mm gyprock, he used as is the best and normal building practice, fibre cement villa board given the area was tiled bathroom wall; 2. the original flush plates were left on site. The oral evidence of the builder 1. In his oral evidence the builder was not cross-examined about the Vola flush plates. The submissions of the parties The submissions of the owner 1. In the owner's 19 July 2021 submissions, the owner's 28 September 2021 submissions and her oral submissions the owner referred to the applicable contract terms and her evidence, and submitted she is entitled to $2,210.91 for the further set of flush plates that she supplied. The submissions of the builder 1. In the builder's 20 August 2021 submissions, the builder's 29 September 2021 submissions, the builder's 5 October 2021 submissions and his oral submissions the builder made the following submissions: 1. the first set of flush plates, which were supplied by the owner, were incorrect size, and were replaced by a second set of flush plates, which he installed. The owner was required to return the first set of flush plates to the supplier for a credit; 2. the owner's submission that that he has stolen the flush plates has not been supported by any evidence from the owner, such as a police report. Consideration 1. I am satisfied that the builder was required to install Vola flushes plates in the bathroom on each of the ground and first floors by drawing AKD-105 when read with specification BA001 of the AK specifications. 2. I am not satisfied that the owner has established that the reason why the Vola flush plates were unsuitable is because of the different thickness between gyrock of 13mm and fibre cement board of 6mm used by the builder. I am not satisfied that the builder kept the Vola flush plates. The first assertion of the owner was not supported by any expert evidence. The second assertion of the owner was not put to the builder in cross-examination. It follows that the owner is not entitled to a credit for this item. Conclusion 1. Having regard to the agreed position of the parties and my findings I am satisfied that: 1. the owner is entitled to a credit for items 76 to 78 paid on behalf of the builder; 2. the amount of these credits is $21,749.00 exclusive of GST and $23,923.90 inclusive of GST. 1. It follows that the owner is entitled to a money order in the sum of $23,923.90 inclusive of GST by way of restitution under s 48O(1)(a) of the HB Act which I have found to be the total amount of credits to which the owner is entitled. Whether the owner is entitled to damages for damages for delay Introduction 1. At the commencement of the hearing the owner indicated that the following two claims were made for damages for damages for delay: "The owner claims an amount in foregone rental due to delay. On 27 June 2018, the owner entered into a residential tenancy agreement to commence on 9 November 2018. The owner subsequently renegotiated the commencement date to 13 December 2018 and then 25 February 2019. She was unable to rent the premises because the works were not finished. She claims $1500 per week for 26 weeks, that is $39,000. The owner also claims storage costs for six months from 11 December 2019 to 11 June 2019. The cost of storage at Kennards Hire was $608 (including GST) a month. The owner was charged a storage cost by Cult Furniture of $320 (including GST). Total claim for storage $3,968 (including GST)." 1. By reason of my rejection of the tender of the third Mullally affidavit (MFI 1), there was no evidence in support of either of these claims. 2. On the first day of the hearing the owner conceded that she had never advised the builder that she was going to rent the property out to obtain an income or that she was suffering any loss because the home could not be rented out. 3. Before considering this issue, I have set out the applicable legal principles, and summarised the evidence of the builder and submissions of the parties. The applicable legal principles 1. In Toplace Pty Ltd v Rashidianfar [2021] NSWCATAP 235 (Toplace) at [32], [36], [38], [45] and [46] the Appeal Panel made the following observations about a claim for loss of rent by way of damages for delay: "[32] In Leeda Projects v Zeng (2020) 61 VR 384; [2020] VSCA 192 Kaye JA at [12] set out the following in relation to contractual damages (citations omitted): The fundamental principles, for the determination of damages for breach of contract, are well established. Essentially, damages are awarded in order to compensate the injured party for the loss and damage arising from the breach of contract. Thus, damages consist of the sum of money which will put the injured party in the same position as if the breach of contract had not occurred. In order to determine the appropriate measure of damages in a particular case, it is necessary first to identify the kind of loss for which the injured party claims compensation. The loss, which is compensable in an action for breach of contract, is that which may fairly and reasonably be considered as arising naturally, that is, according to the usual course of things, from the breach of contract itself, or such as may be reasonably supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it. … [36] In his decision, as noted above, the Member referred to Hadley v Baxendale and framed the question that he had to answer as being whether the loss of rent was in the reasonable contemplation of the parties at the time they made the contract. We agree that this was a correct characterisation of the issue as it could not be said that loss of rent arises naturally from the breach. .. [38] Hadley v Baxendale requires an assessment of what could be reasonably supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it. We agree with Toplace that the relevant time for assessment of what was in the parties contemplation is the time at which the contract was entered into. … [45] The cases that have dealt with whether the loss of the kind claimed may be reasonably supposed to have been in the contemplation of the party against whom the claim is made indicate that some knowledge of the relevant circumstances and an undertaking of the risk, whether that be express or implied, are required (see Victoria Laundry (Windsor) Ltd v Newman Industries Ltd [1949] 2 KB 528; Diamond v Campbell-Jones [1961] Ch 22). Bergin J in Sumy Pty Ltd v Southcorp Wines Pty Ltd [2004] NSWSC 1000 at [77], after reviewing cases in the area, albeit in relation to a contract for the sale of land, noted that there must be some specific knowledge at the time of entering the contract. The person claiming damages must be able to show that, in this case, loss of rent, was more than merely one of a range of foreseeable outcomes (Castle Constructions Pty Ltd v Fekala Pty Ltd (2006) 65 NSWLR 648 at [52]). [46] The following cases illustrate that there be must be some knowledge on the part of the builder at the time the contract is entered into. In Bui v DB Homes Australia Pty Ltd [2017] NSWCATAP 218 in hearing an appeal from homeowners in relation to claimed loss of rental income as a result of delay by the builder in completing the construction of a granny flat, the Appeal Panel noted at [28] that it cannot be assumed that the mere fact that someone is building a granny flat is for the purposes of rental. Similarly, in Ippolito v Cesco [2020] NSWSC 561 Ball J did not allow a claim for lost rent in circumstances where at the time the building contract was entered into it was not anticipated that the premises would be rented out." The evidence of the builder The first Lucien affidavit 1. In the first Lucien affidavit the builder gave evidence that it was his understanding, to the best of his knowledge based on what the owner had told him during his conversations with her and Mr Tengstrom, that she was moving into the property herself, and it wasn't being rented (at [294]). The submissions of the parties The submissions of the owner 1. In the owner's 21 May 2021 submissions, the owner's 19 July 2021 submissions and her oral submissions the owner made the following submissions: 1. the builder ought to have known that she would derive income from the property or, alternatively, would be required to expend money on alternative accommodation and accordingly delay would cause the owner to suffer loss; 2. she relied on the following passage in McGregor on Damages (21st edition, 2020, Thomson Reuters) (McGregor) at [31-009]: "If the builder fails to complete the building by the time required 01 the contract the normal measure of damages should be the value of the use of the building during the period of delay, the value general/y being taken as the rental value." 1. she relied on Leeda Projects Pty Ltd v Zeng (2020) 61 VR 384; [2020] VSCA 192 (Leeda Projects) at [57] per Kaye JA (Tate JA at [1] agreeing) and at [189] per McLeish JA (Tate JA at [1] agreeing): "[57] In the present case, based on the findings of the VCAT Member, the respondent acquired the Eureka apartment for the purpose of her intended use and enjoyment of it as a private art gallery and occasional residence. The building contract described the contract works as 'Fit-out of Private Art Gallery'. The costs of ownership of the apartment — the rates, service charges and the like — were incurred to enable the respondent to have and use the Eureka apartment for that specific purpose. Thus, the proportion of those costs, that the respondent incurred during the delay period, are an appropriate measure of the loss and damage occasioned to her by reason of her inability to use the apartment for its intended purpose during the 130 week delay period, which was caused by the breach of the contract by the applicant. In view of the specific purpose of the building contract, that loss and damage was a reasonably foreseeable consequence of the breach of contract by the applicant." "[189] ... Applying those principles, in my opinion, it must have been within the reasonable contemplation of the parties that, if there was a delay on the part of Leeda in completing the works within a reasonable time, Mrs Zeng would be required to make payments in respect of a property which she could not use, being payments from which she acquired no benefit. The fact that the payments would have been made in any event does not mean that they are not recoverable. …" 1. she relied on the decision in ACN 057 690 034 Pty Ltd v Mick Wykrota [2019] NSWSC 197 (Wykrota) where Emmett AJA in undefended proceedings allowed a claim for loss of opportunity to rent premises in circumstances where there was no evidence that there was in fact a tenant, or there were tenants, who would have been able to take tenancies of the relevant parts of the premises for the period in question; 2. she relied on the following passage in the decision of the Western Australian Building Disputes Tribunal in Kitto v TGSBC Pty Ltd [2004] WABDT 28 (Kitto): "The contract deals at some length with time for performance so that the date for commencement and completion of the Works were of obvious importance. It is difficult to imagine any circumstance in which the completion date of a building contract would not be of significance. When the construction is for commercial or investment purposes delay has obvious financial consequences. Where a residential dwelling has been constructed, as here, the intended purpose is either to enable the owner to reside in the property or to take steps to realise the benefit of the investment either by letting or resale. In either case there are usually cost consequences in the form of rental incurred to live elsewhere or holding costs." 1. had claimed $151,500.00 for 100 weeks of loss of use of the premises. She pressed a claim for $39,000.00, being the equivalent of 6 months loss of rent. By any measure, it is a modest amount for the loss of use of the residential premises for the period since the works were due to be completed, and for the future period in which rectification works will need to be carried out. The submissions of the builder 1. In the builder's 20 August 2021 submissions and his oral submissions the builder submitted that the owner never disclosed to him that she intended to rent out her home, and as such the loss was not reasonably foreseeable. Consideration 1. I am satisfied that the principles set out in Toplace at [32], [36], [38], [45] and [46] should be applied. I do not consider that McGregor at [31-009], Leeda Projects at [57] and [189], the passage in Kitto, or the decision in Wykrota in any way derogate from these principles. The owner has not established any entitled to loss of rent and expenses by way of damages for delay. There was no evidence demonstrating that such losses were in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it. Whether the builder is entitled to be paid for variations and additional works, and if so what amount Introduction 1. The parties reached agreement as to the items in the amended scott schedule to which the owner was entitled to a variation, and the amount of the variation exclusive of GST: 1. item 19 – Variation # 1 – Additional Roof Support to First Floor Storage Room: $1,543.64; 2. item 20 – Variation # 2 – TV ceiling mount framing out: $418.63; 3. item 22 – Variation # 4 – Storage Room: $2,760.36; 4. item 23 – Variation # 5 – Electrical: $3,262.50; 5. item 24 – Variation # 6 – Bathroom Plumbing: $437.50; 6. item 25 – Variation # 7 – Strip Drains: $2,509.10; 7. item 26 – Variation # 8 – Concrete Stairs: $1,900.00; 8. item 27 – Variation # 10 – Flooring adjustment due to thickness of boards changing from 19mm boards to 16mm boards: $2,333.64; 9. item 28 – Variation # 11 – Timber floor allowance : $6,865.00 refund. 1. By reason of the agreed position of the parties set out at [28(2)] and [493] above it is only necessary to determine the items that remain in dispute: items 30 to 32, and 34 to 37. 2. In his written and oral evidence the builder did not give any evidence about the reasonableness of the amounts claimed for the items that remained in dispute. There was no expert evidence as to a fair and reasonable amount for the items that remained in dispute. 3. Before considering this issue I have set out the applicable legal principles. The applicable legal principles Quantum meruit 1. In Vasco Investments Ltd v Morgan Stanley Australia Ltd [2014] VSC 455 (Vasco) at [339]-[342], [344]-[347] Vickery J set out following principles which apply to an action in quantum meruit, as derived from Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221; [1987] HCA 5, Brenner v First Artist Management Pty Ltd [1993] 2 VR 221, Lumbers v W Cook Builders Pty Ltd (in liq) (2008) 232 CLR 635; [2008] HCA 27 and the cases cited therein: "[339] The law may impose an obligation to make restitution on a quantum meruit basis, under what I will call the first class of case, where the plaintiff proves: a. Actual or constructive acceptance of the benefit of the provider's goods or services by the recipient; b. The recipient of the goods or services should have realised that the provider expected to be paid; and c. It would be unjust for the recipient to take the benefit of the goods or services provided without paying a reasonable sum for them. [340] A second class of case falling under the umbrella of a claim in quantum meruit is the long established and well-recognised category of cases constituted by claims for work and labour done or money paid at the request of another. [341] In both classes of case, the law imposes an obligation independent of contract to pay a fair and reasonable sum for the goods or services, founded on the principles of restitution for unjust enrichment. [342] A third class of case giving rise to a claim described as quantum meruit is where goods or services are provided under an existing and enforceable contract which contains an express or implied term to pay a fair and reasonable sum for them, but such sum is not quantified. The action is directed to determining the fair and reasonable sum payable. … [344] Under the first (and indeed the second) class of case, there is no requirement that a 'benefit' for the purpose of this rule of restitution in a claim for payment for services must be an economic benefit. Nor is there a requirement that the provider of the services show that any benefit has arisen as a direct consequence of a particular service rendered. In a claim based on restitution for the benefit of services provided, the question of whether the services constitute a benefit must be considered from the perspective of the recipient, and it is the services themselves which fall to be considered, not the end product of those services. [345] The cause of action seeking relief in quantum meruit in the first class of case (cf. the second class of case) does not call for specific proof of the making of an express or implied request by the recipient of the goods or services. Rather, the making of a request, which is a common factual component in these cases, may provide evidence of a benefit conferred on a recipient. It may also provide evidence of the acceptance of the services that were requested. Further, work done in conformity with a request will in most cases sufficiently satisfy the requirement, stemming from principals of unjust enrichment, that a recipient should not unjustly benefit from the services provided without paying reasonable compensation for them. [346] The provider of the services in the first class of case must prove that the services were not provided as a gift, or on the basis that payment should not be made unless a pre-condition has been met and that condition remains unfulfilled. [347] The court is not concerned with the actual state of mind of the parties when considering whether payment ought to have been contemplated in the first class of case. The appropriate enquiry is whether the recipient of the services, as a reasonable person, should have realised that a person in the position of the provider of the services would expect to be paid for them. Where the services are provided pursuant to a request made in a normal commercial relationship with a person whose business it is to provide those services for reward, this requirement will usually be satisfied. [348] The circumstances which may satisfy the element of injustice sufficient to impose an obligation under the first class of case to make fair and just restitution will vary from case to case. In Angelopoulos v Sabatino (1995) 65 SASR 1 at 12-13, Doyle CJ noted nine factors which were held in that case to give the acceptance of the relevant services the necessary character to support the claim. But these are by no means definitive or exhaustive. Some elements or variants thereof may appear in some cases which justify relief, others may not." 1. In Angelopoulos v Sabatino (1995) 65 SASR 1 (Angelopoulos), which involved the plaintiffs as prospective lessees of a hotel providing plant and equipment and installing it in hotel premises with knowledge and approval of Ditara Pty Ltd, the owner of the hotel, at 12-13, Doyle CJ noted nine factors which were held to give the acceptance of the relevant services the necessary character to support the claim: "First, the plaintiffs did not intend to provide their services gratuitously. They expected a return, if only in the form of more favourable terms of lease. Secondly, the plaintiffs did not provide their services and supply the plant and equipment entirely at their own initiative. They acted not only with the knowledge of Ditara, through its agents, but with the approval of Ditara. In my opinion there was more than passive acquiescence. It is not necessary for me to find that there was a request that the services be performed and the plant and equipment supplied, but were it necessary to do so I would be prepared to conclude that there was an implied request. Thirdly, the plaintiffs did not provide their services on the basis that there would be no payment unless a certain event came to pass. By proceeding as they did the plaintiffs incurred the risk that if a lease did not eventuate they would not be remunerated. But this was not a situation in which it was a common understanding that there would be no remuneration in the event of there being no lease. It was not a situation in which common business practice indicates the parties did intend or should as reasonable persons have realised that remuneration was conditional upon the grant of a lease. Fourthly, this was not a case in which the services were provided on a basis from which the plaintiffs chose to depart. It is not necessary to decide whether the failure to agree upon a lease was attributable to unreasonable conduct on the part of either party. It suffices to say that on the findings of his Honour the plaintiffs did not unilaterally or unreasonably terminate negotiations. Fifthly, the defendant Ditara benefited from what the plaintiffs did. Ditara either incurred less expense than it otherwise would have incurred in restoring the premises or alternatively had premises better fitted for letting out. Sixthly, that benefit was conferred at the expense of the plaintiffs. Seventh, Ditara by its agents approved of or agreed to the plaintiffs carrying out the work which they did. In addition, Ditara by its later sale of plant and equipment, including the plant and equipment installed by the plaintiffs (it being the case that some, at least, of that plant and equipment was readily removable), accepted the benefit of that part of the plaintiffs' work. Eighth, in my opinion the circumstances were such that Ditara by its agents must have known as a reasonable person that the plaintiffs expected to be remunerated for their services. Ninth, there is no argument advanced identifying any particular circumstance by virtue of which it is unjust to require Ditara to remunerate the plaintiffs. By this I mean that no matter such as change of position was advanced, nor, subject to the counterclaim, was it suggested that the work carried out was work which Ditara did not want done or which was of no use to Ditara." 1. In Roude v Helwani [2020] NSWCA 310 (Roude) White JA at [28]-[52] (Brereton JA at [56] and McCallum JA at [57] agreeing) held that the onus was on the builder to establish the reasonableness of his charges in a quantum meruit claim. The determination of the quantum meruit claim did not require the builder to establish the "market rate" for the work performed or to provide an "objective standard" on which his charges could be judged. Although a quantum meruit claim may be proved by such evidence, a judge is not precluded in its absence of same, in the particular circumstances of each case, from making an assessment as to whether the evidence adduced established the reasonableness of the charges. A builder may give evidence of the reasonableness of his charges. White JA at [33] (Brereton JA at [56] and McCallum JA at [57] agreeing) held that a failure to respond to a demand for payment may amount to an admission if there are circumstances which render it more reasonably probable that the owner who denied liability for the claim would answer the claim than that he would not. Item 30 – Variation # 13 – Front door & Rear Gate The Lucien witness statement 1. In the Lucien witness statement the builder gave evidence that on 19 March 2019 he sent an email to the owner in which he relevantly attached variation # 13 (at [43]). In variation # 13 dated 19 March 2019 the builder claimed $660.00 inclusive of GST for the front door and the rear gate, and provided a description of the work undertaken and a breakdown for labour, painting and margin. The first Mullally affidavit 1. In the first Mullally affidavit the owner responded to variation # 13, but her evidence does not include any contemporaneous denial of liability for this variation (at [259]-[270]). The front door 1. The applicable contractual terms, correspondence between the parties and evidence of the parties relating to the front door is set out in relation to item 79 at [459] to [467] above. The rear gate The correspondence between the parties 1. On 3 February 2019 at 9.02pm, the owner sent an email to the builder acknowledging the installation of the back gate and requesting the addition of horizontal lines to match the roller door as depicted in the attached photograph (the 3 February 2019 at 9.02pm email). 2. On 5 February 2019 at 8.54am, the owner sent an text message to the Mr Tengstrom with a photograph depicting a gate with horizontal lines and the accompanying caption "This is the gate". The submissions of the parties The submissions of the builder 1. In the builder's 16 July 2021 submissions and his oral submissions the builder submitted that these works were instructed by the owner and performed by him. The submissions of the owner 1. In the owner's 28 July 2021 submissions and her oral submissions the owner made the following submissions: 1. as to the front door, the contract specified a particular door from Sydney Woodworkers, and the builder supplied and installed a different door. This is not a variation to the contract and she is not liable; 2. as to the rear gate, she accepts that work was done. The owner did not get the benefit of the work because the rear gate was defective for other reasons – see item 3 at [228(3)] above. Consideration 1. There was no variation of the contract relating to the front door and rear gate as the procedure for variation in cl 13 of the general conditions was not followed. 2. I have already found at [470] above that the owner is not entitled to a credit for the front door because she did not establish that the builder supplied the incorrect door. It follows that I am satisfied that the builder is entitled to a reasonable amount for changing the front door. 3. I am satisfied that the builder is entitled to a reasonable amount for the changing the rear gate as he performed the work instructed by the owner. The fact that the rear gate was defective is not a reason for refusing a variation for this item. 4. The builder adduced no evidence of the reasonableness of the amount of $660.00 inclusive of GST charged for variation # 13. However, applying the principle in Roude at [33], [56] and [57], the failure of the owner to challenge variation # 13 in circumstances where there was a long history of challenges by her to the builder constituted an admission of the reasonableness of this amount. It follows that the builder is entitled to $660.00 for this item. Item 31 – Variation # 14 – Laundry The applicable contractual terms 1. Drawing AKD-001 of the AK specifications depicts a storage cupboard and a sink inserted in a bench in the Laundry. 2. Drawing AKD-007 of the AK specifications contains the notations "PT-07" for the ceiling, "PT-04" for the walls, "CT-02" for the splashback, "ST-01" for the floor, "PT-01 Polyurethane" for the joinery and "ST-03" for the benchtop under the heading "Laundry". Specification PT001 of the AK specifications specifies details for the codes "PT-01" and "PT-04". Specification CT001 of the AK specifications specifies details for the code "CT-02". Specification ST001 of the AK specifications specifies details for the code "ST-03". 3. Drawing AKD-100 of the AK specifications depicts the benchtop in which the sink is located and the underbench cupboards, and contains notations for the underbench cupboards and benchtop. The Lucien witness statement 1. In the Lucien witness statement the builder gave evidence that on 19 March 2019 he sent an email to the owner in which he relevantly attached variation # 14 (at [43]). In variation # 14 dated 19 March 2019 the builder claimed $3,851.85 inclusive of GST for the laundry area variation, and provided a description of the work undertaken and a breakdown for labour, materials, painting, waterproofing, pick up and delivery fees, truck fees, and margin. The description of work was in the following terms: "Re-Position of LED Stip light. Build out rear wall and sheet with FC Villaboard. Build wall to enclosed stair void and sheet as required with FC villaboard. Supply and fit door jamb Waterproofing of new works area. Supply and fit new solid block doors cut down to suit new jamb opening. Painting of new works. Truck usage and tipping fees." The first Mullally affidavit 1. In the first Mullally affidavit the owner responded to variation # 14, but her evidence does not include any contemporaneous denial of liability for this variation (at [271]-[273]). She gave the following evidence (at [273]): 1. the builder did not re-position the LED strip light; 2. the builder did not build out the rear wall behind the laundry basin; 3. the builder did not paint under the stair area. The first Lucien affidavit 1. In the first Lucien affidavit the builder gave the following evidence (at [273]): 1. variation # 14 arose because the laundry works were complete except for the tiling, and installation of a stone top. Prior to the installation of the stone top and tiling the owner changed her mind and instructed him to change the position of the water services and the vanity layout of the laundry, after these works had initially been completed. This resulted in the variation; 2. he agreed that he did not complete the LED strip works; 3. he had partly constructed the wall and joinery at the time of the termination of the contract; 4. he agreed that he did not complete the painting works beneath the stairs. The second Mullally affidavit 1. In the second Mullally affidavit the owner gave evidence that she did not change the layout of the laundry. The joiner engaged by the builder did not allow for any LEDs in the wardrobes or vanities. The LEDs had to be retrofitted which required individual switches on each wardrobe door instead of one continuous strip with a sensor. The LED was supposed to be recessed in the vanities and it had to be surfaced mounted because it had not been recessed (at [273]-[274]). The oral evidence of the builder 1. In his oral evidence the builder was cross-examined about variation # 14. He agreed that the work done in the laundry at the time of the termination of the contract was depicted in the three photographs (Ex O12) (Tcpt, 21 May 2021, pp 49(3)-50(7)). The layout of the stairs was at the request of the owner was slightly different to that depicted in drawing AKD-001 of the AK specifications (Tcpt, 21 May 2021, pp 50(43)-51(12)). The oral evidence of the owner 1. In her oral evidence the owner was not cross-examined about variation # 14. The submissions of the parties The submissions of the builder 1. In the builder's 16 July 2021 submissions and his oral submissions the builder submitted that these works were instructed by the owner and performed by him. The submissions of the owner 1. In the owner's 28 July 2021 submissions and her oral submissions the owner made the following submissions: 1. the work in the laundry was included in the contract scope of works; 2. the work in the laundry was not completed; 3. the builder does not point to any documentary evidence of the request by her to change the position of the water services and the vanity layout, nor does he give evidence of any alleged conversation where the request made. Consideration 1. I am not satisfied in the absence of any challenge to the owner's denial of a request to change the position of the water services and the vanity layout in the laundry from that depicted in drawing AKD-001, AKD-007 and AKD-100 of the AK specifications that the builder has established that the owner made such a request. It follows that the builder's claim for this item fails. Item 32 – Variation # 15 – Joinery lighting The applicable contractual terms 1. Clause 13 of the general conditions relevantly provided: "Variations The work to be done or materials used under this contract may be varied: … • at the request of the contractor. If the necessity for the variation is due to the fault of the contractor the owner will not be liable for any increase in the contract price, or …" 1. The 11 July 2017 quote relevantly provided: "31 Joinery ... 31.13 GROUND FLOOR BATHROOM: … 31.20 LED ally channel recessed to cabinet soffit panel. … 31.22 FIRST FLOOR BATHROOM: … 31.30 LED ally channel recessed to soffit panel of s/c only. … 31.32 FIRST FLOOR BEDROOM 2 ROBES: … 31.37 LED ally strip recessed where indicated. … 31.41 FIRST FLOOR BEDROOM 1 ROBES: … 31.49 LED strip to top of cabinetry ally chanel to be recessed. … 31.73 LAUNDRY … 31.79 LED ally recessed in to floating shelf." 1. Drawings AKD-003 and AKD-004 of the AK specifications depict LED strip lights and the notations "New LED Strip Light (Recessed Unless Otherwise Spec)" and "LED On Sensor (WIR)" under the heading "Legend New Light Fittings". 2. Drawing AKD-110 of the AK specifications depicts a LED strip light and the accompanying notation "LED". 3. Drawings AKD-112 and AKD-115 of the AK specifications depict a LED strip light and the notation accompanying notation "a LED Strip Light". The Lucien witness statement 1. In the Lucien witness statement the builder gave evidence that on 19 March 2019 he sent an email to the owner in which he relevantly attached variation # 15 (at [43]). In variation # 15 dated 19 March 2019 the builder claimed $2,076.25 inclusive of GST for the electrical variation, and provided a description of the work undertaken and a breakdown for labour, materials, and margin. The description of work was in the following terms: "Supply & install 11 extra door switches for joinery doors Kitchen pantry, Guest bedroom, Bedroom 1 & 2 switches equivalent to ETPDS brand switch." The first Mullally affidavit 1. In the first Mullally affidavit the owner responded to variation # 15, but her evidence does not include any contemporaneous denial of liability for this variation (at [275]-[279]). She gave evidence that the builder did not complete the works the subject of variation # 15, and that she engaged Glenco Electrical after termination of the contract to make the lighting operable (at [279]). The first Lucien affidavit 1. In the first Lucien affidavit the builder gave evidence that he agreed the works were unable to be completed at the time the contract was terminated (at [279]). The oral evidence of the builder 1. In his oral evidence the builder was cross-examined about variation # 15. When asked whether he did not know one way or the other whether there was material left on site, he answered that he knew those works were completed because of what he was told by the electrician (Tcpt, 21 May 2021, pp 56(12)-(18)). The oral evidence of the owner 1. In her oral evidence the owner was not cross-examined about variation # 15. The submissions of the parties The submissions of the builder 1. In the builder's 16 July 2021 submissions and his oral submissions the builder submitted that this variation relates to materials delivered to the site. The submissions of the owner 1. In the owner's 28 July 2021 submissions and her oral submissions the owner made the following submissions: 1. there is no evidence of what was left on site, and why materials left on site would be a variation to the contract payable by the owner; 2. joinery lighting was a contract inclusion as specified in the 11 July 2017 quote and drawings AKD-003, AKD-004, AKD-110, AKD-112 and AKD-115 of the AK specifications; 3. the joiner subcontracted to the builder did not allow for LEDS in the wardrobes and vanities. That meant the LEDS had to be retro-fitted with individual switches instead of continuous strips on a sensor; 4. clause 13 of the general conditions provides that a variation due to the fault of the builder is not payable by the owner. If the builder had to buy some additional or alternative fittings, and if they were left on site as he alleges, he should bear the cost. Consideration 1. I am satisfied that drawing AKD-003 of the AK specifications depicts a LED strip light for the pantry door in the kitchen, and the 11 July 2017 quote and drawings AKD-004, AKD-110, AKD-112 and AKD-115 of the AK specifications depicts LED strip light for bedrooms 1 and 2 and a LED sensor lights for the walk in robes for bedrooms 1 and 2. 2. I am not satisfied that the builder has established that he was entitled to a variation by reason by the exclusion in cl 13 of the general conditions. In the absence of any challenge to the owner's evidence I am satisfied that that the joiner subcontracted to the builder did not allow for LEDs in the wardrobes and vanities which meant the LEDs had to be retro-fitted with individual switches instead of continuous strips on a sensor. Further, I am not satisfied that the builder has established that switches for LED switches were left at the site when the contract was terminated. It follows that the builder's claim for this item fails. Item 34 – Additional works – Fitting of TV unit in bedroom The Lucien witness statement 1. In the Lucien witness statement the builder gave evidence that he fitted the TV unit in a bedroom at the request of the owner (at [48]). The first Mullally affidavit 1. In the first Mullally affidavit the owner gave evidence that to the best of her knowledge this work was completed by the automation contractor (at [293(a)]). The first Lucien affidavit 1. In the first Lucien affidavit the builder gave evidence that he completed at the TV fitting work (at [293(a)]). The oral evidence of the builder 1. In his oral evidence the builder was cross-examined about this item. He gave evidence that he knew those works were completed because of what he was told by Mr Tengstrom. He said his staff built the frame and helped the owner's automation contractor lift the TV into position (Tcpt, 21 May 2021, pp 57(6)-(44)). The oral evidence of the owner 1. In her oral evidence the owner was not cross-examined about this item. The submissions of the parties 1. Neither the builder nor the owner made submissions about this item. Consideration 1. I am not satisfied that, in the absence of any challenge to the owner's evidence that this work was done by her automation contractor, the builder has established that he undertook this additional work. Further, even if the builder did undertake this additional work, I would not have been satisfied that he had established that the amount of $700.00 was a reasonable amount for this item. It follows that the builder's claim for this item fails. Item 35 – Additional works – Rendering neighbour's side fence The Lucien witness statement 1. In the Lucien witness statement the builder gave evidence that he rendered the owner's neighbour's side fence (at [48]). The first Mullally affidavit 1. In the first Mullally affidavit the owner gave evidence that she had no expectation that any work outside the scope of the contract would be completed by the builder free of charge (at [291]). She did not at any stage request that the builder do this work (at [293(b)]). She had conversations with the site foreman to the following effect (at [293(b)]): Foreman: "The neighbours want the boundary wall bagged because they think the brick is ugly." Me: "No, I don't agree to pay for that. I have already wholly paid for the construction of all the boundary walls and a Merbau timber inlay section on their side.'' Foreman (days later): "Tony is bagging the neighbour's wall at his own cost." Me: "Really? That surprises me. Tony doesn't do anything for free." The oral evidence of the builder 1. In his oral evidence the builder was cross-examined about this item. He gave evidence denying that he had had not received a request from the owner to do this work. The owner's request was made both to him and Mr Tengstrom (Tcpt, 21 May 2021, pp 57(46)-58(30)). The oral evidence of the owner 1. In her oral evidence the owner was not cross-examined about this item. The submissions of the parties The submissions of the builder 1. In the builder's 16 July 2021 submissions and his oral submissions the builder referred to the evidence of the owner in the first Mullally affidavit at [291], and submitted that the works were outside the contract scope of works and provided, and the works should be paid for as claimed as the owner has received the benefit of these further works. The submissions of the owner 1. In the owner's 28 July 2021 submissions and her oral submissions the owner submitted there being no request by her, and no benefit to her, she is not liable for the cost of the work. Consideration 1. I am not satisfied that, in the absence of any challenge to the owner's evidence that she did not request this work, the builder has established that he undertook this additional work at her request. I am not satisfied that she received any benefit from this work. Further, even if the builder did undertake this additional work at her request, I would not have been satisfied that he had established that the amount of $800.00 was a reasonable amount for this item. It follows that the builder's claim for this item fails. Item 36 – Additional works – Suspended ceiling first floor The applicable contractual terms 1. Drawing DA.1003 of the PW plans in the section depicts two joists at around ceiling height. The lower one is flat and the higher one is sloped. 2. Drawing 15171-S08(A) of the CC plans depicts a sloping roof. 3. The acoustic report in relation to the roof/ceilng has options 1 and 2 within table 4 which each depict a sloping ceiling. 4. On 11 August 2018 at 12.18pm the owner sent an email to Paul Wilsher (Mr Wilsher) of Paul Wilsher Design (the 11 August 2018 at 12.18pm email) in which she relevantly stated: "The upstairs ceilings affected are the hallway, bathroom, bedroom 2 and bedroom 3. The slope is not great enough on the inside to warrant the ceilings to be sloped. If they are sloped it will look wonky. I want the ceilings to be flat. Builder says plans show sloped, but I can't find where it says that. Please advise." 1. On 14 August 2018 at 4.01pm Mr Wilsher sent an email to the owner in which he relevantly stated: "I always intended the ceilings to be flat … I agree, a sloped ceiling with a low pitch just looks wrong. The section A – A on drawing 1003 has a flat ceiling joist shown. I always new (sic) the heights would be tight and that you may have had to reduce the ceiling height from 2.5 to 2.4. The ceiling could perhaps be battened out or suspended to achieve a flat surface with minimal loss of height. The engineer's plans only show the sloped rafter but they are not to be taken as the finished details as they only show structural members." The Lucien witness statement 1. In the Lucien witness statement the builder gave evidence that he completed the suspended ceiling on the first floor at the request of the owner (at [48]). The first Mullally affidavit 1. In the first Mullally affidavit the owner gave evidence that this was never a variation (at [293(c)]). The first Lucien affidavit 1. In the first Lucien affidavit the builder gave evidence that a suspended ceiling was required because the owner did not want a raked ceiling and the only way to achieve this was to install a suspended ceiling as she had requested (at [293(c)]). The oral evidence of the builder and the owner 1. Neither the builder nor the owner gave oral evidence about this item. The submissions of the parties The submissions of the builder 1. In the builder's 16 July 2021 submissions and his oral submissions the builder made the following submissions: 1. the owner's drawings indicated a raked ceiling. She did not want a raked ceiling and requested a suspended ceiling. He constructed a suspended ceiling as instructed. The suspended ceiling was not readily evident in the contract drawings, and as such was not a contract item. There is no dispute that he has performed the suspended ceiling works. He should be paid for these additional works performed, and as claimed; 2. drawing DA.1003 of the PW plans does not indicate a suspended ceiling; 3. the acoustic report indicates raked ceilings; 4. the variation should be valued and awarded in the full amount of $3,500.00 inclusive of GST. The submissions of the owner 1. In the owner's 28 July 2021 submissions and her oral submissions the owner made the following submissions: 1. the builder relies upon a schematic diagram in the acoustic report showing the placement of insulation between the particle board under the metal cladding and the plasterboard ceiling. The acoustic report is not a building plan; 2. the builder gives no evidence about how he came to identify the suspended ceiling as additional work or of any negotiation with the owner about it. The first time the claim was made for this item, and the other items of additional work, was at the commencement of proceedings. There is no evidence about the difference in the work required under the contract and the suspended ceiling – both presumably required framing and plasterboard - and the relationship between work done and the amount claimed is unexplained. Consideration 1. I am satisfied that there is conflict between drawing DA.1003 of the PW plans, on the one hand, and drawing 15171-S08(A) of the CC plans and the acoustic report in relation to the roof/ceilng, on the other hand. There is no evidence of any discussion between the owner and the builder as required by cl 1 of the general conditions to seek agreement as to the work to be performed. It follows that the builder's claim for this item fails. 2. If the contract on its proper construction required a raked ceiling, then: 1. I would not have been satisfied that, in the absence of any evidence of a request by the owner, the builder had established that he undertook this work at her request; 2. I would have been satisfied that this work falls within the first class of quantum meruit case identified in Vasco at [339] having regard to the nine factors identified in Angelopoulos at 12-13. In the light of the 11 August 2018 at 12.18pm email I would have been satisfied that the owner received benefit from this work within the principles identified in Vasco at [343]; 3. I would not have been satisfied that the builder had established that the amount of $3,500.00 inclusive of GST was a reasonable amount for this item. This is no evidence of the additional work required for a suspended ceiling as opposed to a raked ceiling, and how the amount of $3,500.00 inclusive of GST has been calculated. Further, there is no evidence that the amount of $3,500.00 inclusive of GST is a reasonable amount for this work. Item 37 – Additional works – Change floor batten level on ground floor The correspondence between the parties 1. Variation # 10 was attached to the 20 December 2018 at 7.38am email. The Lucien witness statement 1. In the Lucien witness statement the builder gave evidence that he change the floor batten level on the ground floor at the request of the owner (at [48]). The first Mullally affidavit 1. In the first Mullally affidavit the owner gave evidence that she paid for this work under variation # 10 in the amount of $2,567.00 inclusive of GST (at [293(d)]). The first Lucien affidavit 1. In the first Lucien affidavit the builder gave evidence that the batten level on the ground floor was required because the battens had initially been installed and set out for 19mm thick floorboards. The owner requested and also required the battens to be removed and re-laid to suit the new 16mm thick floorboards she had ordered herself (at [293(d)]). The oral evidence of the builder 1. In his oral evidence the builder was cross-examined about this item. He gave the following evidence: 1. when first asked about this item (Tcpt, 21 May 2021, pp 59(6)-(16)): "Q. And the original size specified 19 millimetres, is that right? A. I believe so, yeah. Q. And then 16 millimetres was specified? A. She chose that, yes. Q. And that's the timber flooring that got installed? A. We'd already set up the batons for 19 mil-- Q. Yes. A. --and then we had to change it again for 16 mil." 1. when again asked about this item (Tcpt, 21 May 2021, pp 60(3)-(13)): "Q. Yeah. There was only one change 19 to 16. A. No, but what I'm saying we'd already set up for the 19 mil. Q. Yes. And that - you did what the contract required and then you did a variation for the 16 mil and that was the end of it? A. No, sorry, I'm just trying to remember because there was so many changes, but I think it was, it wasn't a 19, I think it actually was a bit more, it was like a, a 21 mil flooring just..(not transcribable).. Q. Where's that, where's that in your evidence? A. Well, it's not in there." The submissions of the parties The submissions of the builder 1. In the builder's 16 July 2021 submissions and his oral submissions the builder made the following submissions: 1. the variation arises because the owner changed the width of the floor-boards from 21mm in width to 18mm, which required him to pack up all of the timber floor areas to suit the floor-board change requested by her. This additional work was claimed for in variation # 10, which is not in dispute; 2. once he had completed these additional works, for the board width change from 21mm to 18mm, the owner changed her mind again and instructed him to change the floor-board width from 18mm to 16mm, which required him to again change the floor heights, which gives rise to the quantum meruit claim for a further $2,500.00 inclusive of GST. The submissions of the owner 1. In the owner's 28 July 2021 submissions and her oral submissions the owner referred to the applicable contract terms and the evidence of herself and the builder, and submitted the builder's submissions do not set out the evidence accurately. There is no evidence that the battens were re-laid twice on her instructions. Consideration 1. I am not satisfied that the builder has established that he re-laid the battens twice on the owner's instructions and undertook this additional work at her request. The builder's oral evidence was vague and inconsistent. The submission that the battens were re-laid twice is inconsistent with variation # 10 which relates to the same work as encompassed by this item. Further, even if the builder did undertake this additional work at her request, I would not have been satisfied that he had established that the amount of $2,500.00 inclusive of GST was a reasonable amount for this item. It follows that the builder's claim for this item fails. Conclusion 1. Having regard to the agreed position of the parties and my findings I am satisfied that: 1. the builder is entitled or liable to a variation of the contract for items 19, 20, 22 to 28, and 30; 2. the total of the agreed amount and reasonable amount for these items is $8,960.37 exclusive of GST and $9,856.41 inclusive of GST. 1. It follows that the sum $9,856.41 inclusive of GST needs to be added to the contract price payable by the owner to the builder. The costs of the two proceedings 1. I will deal with the costs of the two proceedings as follows: 1. if the parties are in agreement as to the costs of the two proceedings, then they shall provide proposed consent orders to the Tribunal within 14 days of the date of the orders in these reasons for decision; 2. if the parties are in agreement as to the costs of the two proceedings, then: 1. if any party seeks a costs order, the applicant for costs (the costs applicant) must file and serve a costs application, submissions which shall address the question of whether an order should be made dispensing with a hearing and be limited to five pages, and any evidence in support, within 14 days of the date of the orders in these reasons for decision; 2. the respondent to the costs application is to file and serve any submissions which shall address the question of whether an order should be made dispensing with a hearing and be limited to five pages, and any evidence in opposition, within 14 days thereafter; 3. the costs applicant is to file any submissions in reply limited to three pages within 14 days after receipt of the submissions and any evidence of the respondent to the costs application. Orders 1. I am satisfied that the owner is entitled to an order that the builder pay her $31,660.65 inclusive of GST calculated as follows: 1. contract sum: $812,770.00; 2. plus variations (# 1, #2, #4 to # 8, #10, #11 and #13): $9,856.41; 3. less payments made by the owner to the builder: $711,670.62; 4. = amount owing to the builder: $110,889.79; 5. less defects: $64,229.35 6. less incomplete works: $54,462.70; 7. less payments made by the owner on behalf of the builder: $23,923.90. 1. I make the following orders: 1. the builder is pay the owner the sum of $31,660.65 immediately; 2. if the parties are in agreement as to the costs of the two proceedings, then they shall provide proposed consent orders to the Tribunal within 14 days of the date of the orders in these reasons for decision; 3. if the parties are not in agreement as to the costs of the two proceedings, then: 1. if any party seeks a costs order, the applicant for costs (the costs applicant) must file and serve a costs application, submissions which shall address the question of whether an order should be made dispensing with a hearing and be limited to five pages, and any evidence in support, within 14 days of the date of the orders in these reasons for decision; 2. the respondent to the costs application is to file and serve any submissions which shall address the question of whether an order should be made dispensing with a hearing and be limited to five pages, and any evidence in opposition, within 14 days thereafter; 3. the costs applicant is to file any submissions in reply limited to three pages within 14 days after receipt of the submissions and any evidence of the respondent to the costs application. ********** I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 16 February 2022