The Owners – Strata Plan 99960 v SPS Building Contractors Pty Ltd (No 2) [2024] NSWSC 1119

Supreme Court New South Wales

Medium Neutral Citation: The Owners – Strata Plan 99960 v SPS Building Contractors Pty Ltd (No 2) [2024] NSWSC 1119 Hearing dates: 3 September 2024 Date of orders: 3 September 2024 Decision date: 03 September 2024 Jurisdiction: Equity - Technology and Construction List Before: Nixon J Decision: (1) Judgment against the Defendant in the amount of $8,681,457.11. (2) The Defendant is to pay the Plaintiff's costs of the proceedings, as agreed or assessed. Catchwords: DAMAGES – costs of rectification works Cases Cited: Gagner Pty Ltd trading as Indochine Café v Canturi Corporation Pty Ltd [2009] NSWCA 413 The Owners – Strata Plan 99960 v SPS Building Contractors Pty Ltd [2024] NSWSC 687 Category: Consequential orders Parties: The Owners – Strata Plan 99960 (Plaintiff) SPS Building Contractors Pty Ltd (Defendant) Representation: Counsel: J Young (Plaintiff) S Stone (Director, by leave)

Solicitors: OMB Solicitors (Plaintiff) File Number(s): 2021/238327 Publication restriction: Nil

EX TEMPORE JUDGMENT – REVISED 3 September 2024 1. These proceedings relate to defects in a development of townhouses in Tweed Heads, New South Wales (the Development). On 7 June 2024, I delivered a judgment in these proceedings, addressing all issues other than quantum: The Owners – Strata Plan 99960 v SPS Building Contractors Pty Ltd [2024] NSWSC 687 (the Principal Judgment). This judgment assumes familiarity with the Principal Judgment. 2. In the Principal Judgment, I determined in respect of each alleged defect in the Development: 1. whether the defect was established; 2. whether the Defendant (SPS) was responsible for the defect; 3. the scope of the required rectification work; and 4. whether any defect or any of the rectification work related to lot property rather than the common property and, if so, whether the Plaintiff (the Owners Corporation) was entitled to claim for the costs of such work. 1. The parties had previously filed expert reports in relation to the quantification of the cost of the required rectification works. However, no joint report was prepared due to the fact that there was significant delay in the issuing of a joint report by the building experts (which only occurred in the middle of the hearing). 2. Against that background, and for reasons explained in the Principal Judgment, I made an order for issues of quantum to be determined separately from, and after publication of reasons in relation to, the other issues in the proceedings: Principal Judgment at [8]. 3. Following the delivery of the Principal Judgment, I made orders for the costs experts to confer and prepare a joint report providing their estimates of the costs of the rectification works identified in the Principal Judgment. 4. After those orders were made, SPS's solicitor went off the record. Mr Simon Stone, a director of SPS, was given leave to represent SPS in these proceedings. Mr Stone indicated that SPS did not intend to call its costs expert or to lead any other expert evidence regarding the quantification of the rectification works. Accordingly, the orders for a joint report were vacated, and orders were made for the Owners Corporation to file and serve its expert evidence on the issue of quantification. 5. The Owners Corporation has relied at the hearing on quantum on the following expert evidence: 1. a report of Mr David Madden, who is a quantity surveyor, dated 27 August 2024, addressing the cost of the rectification works identified in the Principal Judgment; 2. an affidavit of Ms Belinda Dinsey, a real estate agent, dated 28 August 2024, concerning the costs of alternative accommodation while the rectification works are being performed; and 3. a supplementary report of Mr Madden dated 30 August 2024, correcting one matter in his earlier report and updating his calculations. 1. In addition, the Owners Corporation tendered a section of an earlier report of Mr Madden (to which he referred in his 27 August 2024 report when explaining his reasoning), and referred to parts of a report prepared by SPS's building expert, Mr Zakos, which was tendered by SPS at the hearing in respect of the defect issues. 2. Neither Mr Madden nor Ms Dinsey was required for cross-examination. No objection was taken to any part of their evidence. 3. SPS did not lead any evidence on the remaining issues in the proceedings. 4. The Owners Corporation provided written submissions regarding the remaining issues in the proceeding. Further, in oral address, Counsel for the Owners Corporation went through those submissions in some detail and took the Court to relevant parts of Mr Madden's two reports, and the annexures to those reports, as well as Ms Dinsey's evidence. 5. SPS did not provide any written submissions on the remaining issues in the proceeding. At the hearing on quantum, Mr Stone, who appeared for SPS, confirmed that he did not advance any submissions in response to the submissions and evidence of the Owners Corporation on quantum.