Anthony Augustine Libreri and Marie Doris Libreri v Jeffrey Pau Burke [2012] NSWDC 27

District Court New South Wales

Medium Neutral Citation: Anthony Augustine Libreri and Marie Doris Libreri v Jeffrey Pau Burke [2012] NSWDC 27 Hearing dates: 13 December 2011 Decision date: 09 March 2012 Jurisdiction: Civil Before: Judge M Sidis Decision: 1. Verdict for the defendants on the plaintiff's claim. 2. Verdict and judgment for the cross claimants on the cross claim in the sum of $27,217.12. 3. The proceedings are adjourned to a date to be fixed to deal with issues of interest and costs. 4. My reasons are published. Catchwords: BUILDING: Rights of termination - unpaid invoice - claim of overpayment - misrepresentation of status as licensed builder - exercise of discretion to award quantum merit Legislation Cited: Home Building Act 1989 Cases Cited: Eddy Lau Constructions Pty Ltd v Transdevelopment Enterprise Pty Limited [2004] NSWSC 273 Pender v Robwenphi Pty Ltd & Anor [2008] NSWSC 1144 Category: Principal judgment Parties: Anthony Augustine Libreri (First Plainitff)Marie Doris Libreri (Second Plainitff) Jeffrey Pau Burke (Defendant) Representation: MRM Thompson Norrie Lawyers (For the Plaintiffs) Roberts Legal (For the Defedants) File Number(s): 2010/101619

Judgment 1Mr and Mrs Libreri contracted with Mr and Mrs Burke for the construction of a house on their property at Greta. The contract was dated 8 June 2006 and the contract price was $695,611. The completion date was February 2009. 2The contract price was based on the drawings prepared by Mr Cronan of Cronan's Design and Drafting for the purposes of a development application. In order to secure a building certificate it was necessary for Mr Cronan to prepare drawings detailing additional engineering requirements for the foundations for the house. 3Those additional engineering requirements and other extras added to construction costs and extended the date for completion. 4In accordance with his standard practice, Mr Burke submitted fortnightly progress claims. The plaintiffs paid those claims regularly until a progress claim was submitted on 8 March 2009. By that stage the plaintiffs had paid invoices amounting to $560,298.27 5In mid-March 2009 the plaintiffs spoke with Mr Burke and expressed concern that the amount expended was close to the contract price and the construction of the house had not yet reached lock up stage. 6Discussions took place between them in the course of which the plaintiffs told Mr Burke that they did not have funds to allow them to pay more than the contract price and could not fund the balance of the work required to complete the house. They demanded that he complete it for the contract price, regardless of the variations to date and those involved in finalising the work. 7In the meantime Mr Burke continued to work on the house. The invoice dated 8 March 2009 was paid on 19 March 2009. A further invoice was issued on 19 March 2009 and paid on 20 March 2009. 8Mr Burke issued a further invoice on 31 March 2009. There were further discussions between the parties, the precise terms of which were in dispute but they related to the plaintiffs' demands that Mr Burke complete the contract works for the contract price and Mr Burke's demand that the outstanding invoice be paid. 9On 7 April 2009 Mr Burke withdrew from the construction site. A further invoice was issued on 25 April 2009. 10Solicitors were brought in. Each party purported to terminate the contract and this litigation resulted. 11In their statement of claim the plaintiffs acknowledged that the contract provided for payment of the contract sum of $695,611 and that the contract provided for the payment of variation costs at the rate of $120 per two men, plus goods and services tax, and the cost of materials. They claimed: 1The defendants' refusal to complete the contract works amounted to a repudiation of the contract which they accepted. They claimed the cost to complete the works in the sum of $372,866.19, after taking into account the amount due to the defendants under the invoice dated 25 April 2009 that has not been paid. 2They relied, to their financial detriment, on representations of Mr Burke that were misleading, fraudulent, false and deceptive that he was the holder of a licence under the Home Building Act 1989. 3They overpaid the defendants $104,814.37. The plaintiffs subsequently acknowledged a mistake in this calculation and revised the figure to $100,814.37. 4The cost of rectifying defective work in the sum of $2,197.86. 5The cost of extra foundation work required to meet the certifying authority's requirements. 6Exemplary damages. 12In their defence the defendants claimed that the works were lawfully suspended for non-payment of the invoice dated 25 April 2009 and that they lawfully terminated the contract on 23 October 2009 for the same reasons. Without admission, they conceded the rectification costs and offered to offset the sum of $2,197.86 against their claims. They put in issue the claim of reliance on Mr Burke's representations concerning his status as a licensed builder. 13The defendants cross claimed seeking damages for the loss of the benefit of the contract. 14The following claims were not pursued: 1At the commencement of the hearing the defendants abandoned their claim for the loss of the benefit of the contract, except to the extent of the amount due under the invoice of 25 April 2009, namely $29,414.98. 2At the conclusion of the hearing the plaintiffs abandoned their claims for the costs of extra foundation work and exemplary damages.