Kavanagh -v- New South Wales Self Insurance Corporation [2024] NSWCATCD 14

Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Kavanagh -v- New South Wales Self Insurance Corporation [2024] NSWCATCD 14 Hearing dates: 1 November 2023 Date of orders: 12 January 2024 Decision date: 12 January 2024 Jurisdiction: Consumer and Commercial Division Before: P Moran, Senior Member Decision: 1. Appeal against the decision of the respondent made 24 February 2023 allowed. 2. The decision of the respondent made 24 February 2023 be set aside. 3. The claim by the applicant upon the respondent made 2 August 2022 be reconsidered by the respondent pursuant to law. Catchwords: HOME BUILDING APPLICATION – building claim – appeal against decision of insurer under building cover contract – whether policy provision excludes cover – successor in title – whether successor in title has an interest in the work – non completion of work by builder Legislation Cited: Home Building Act 1989 (NSW) Cases Cited: Alliance Australia Insurance Limited -v- Rawson Homes Pty Limited [2021] NSWCA 224 Texts Cited: Nil Category: Principal judgment Parties: Applicant: Alana Kavanagh Respondent: New South Wales Self Insurance Corporation Representation: Applicant: M Draybi, Centurion Lawyers Pty Limited Counsel: T Smartt

Respondent: D Newey, Gillis Delaney Lawyers Counsel: S Ahmed File Number(s): 2023/00402222 (Previously HB 23/16467) Publication restriction: Nil

REASONS FOR DECISION

Background/Application 1. The applicant is the owner of premises in Cocoparra Circuit, North Kellyville (Property); settlement of her purchase of the property from CN1 Pty Limited (CN1) occurring on 29 December 2021 following the entering into of a Contract for Sale of Land on 30 April 2021. 2. Prior to the applicant's purchase of the property from CN1 the vendor had entered into a NSW Residential Building Contract for New Dwellings with Willoughby Homes Pty Limited (Builder) on 17 February 2021 for the construction by the builder of a two storey residential dwelling on the property (Building Contract). 3. Some two weeks prior to the builder and CN1 entering into the building contract the respondent had, on 4 February 2021, had issued to CN1 a Policy of Insurance under Part 6 of the Home Building Act 1989(NSW) (Policy). 4. Both the building contract and the policy are discussed in greater detail later in these Reasons. Two certificates were issued in respect of two lots comprising the North Kellyville property. 5. In late July 2022 the builder, having commenced the building work for CN1 pursuant to the building contract prior to the applicant becoming the registered proprietor, became insolvent and did not thereafter attend the property or complete the works. 6. On 2 August 2022 the applicant made a claim under the policy against the respondent in respect of incomplete building work, defective building work, defective design and legal (and other) costs. 7. The respondent, having received the claim, accepted liability for defective work on 31 October 2022 but denied liability in respect of the claim for incomplete building work, relying upon clause 3.2 of the policy. The claim on the policy, and the respondents response to the claim, are discussed in more detail below. 8. In response to a request by the applicant the respondent reviewed its decision in respect of the incomplete building work component of the claim. It informed the applicant on 24 February 2023 that it was maintaining its declinature of liability. 9. Following notification of the review decision the applicant on 6 April 2023 lodged the current Application. She seeks an order to allow an appeal against the indemnity decision of the respondent. She contends the respondent's rejection of the claim in respect of incomplete works by relying upon clause 3.2 of the policy was erroneous because 1. it misconstrued the clause, and 2. it erred in concluding that the clause had application to the claim for incomplete work.