12 December 2024
19 min read
#Property, Planning & Development
Published by:
Today the High Court dismissed an appeal from the 2023 decision, The Owners – Strata Plan No 84674 v Pafburn Pty Ltd [2023] NSWCA 301 (Pafburn), where it had been held that:
The broader dispute between Pafburn Pty Ltd and the relevant owners corporation has been instructive in relation to claims under the Design and Building Practitioners Act 2020 (NSW) (DBPA), although the particular decision under appeal is the first time the legislation has been considered by the High Court.
The practical result of Pafburn was that it was up to the (for example) defendant builder to pass on its liability to subcontractors by filing cross claims, rather than relying on the proportionate liability provisions of the CLA.
The secondary effect is to burden solvent defendants with primary liability and no ability to reduce exposure consistent with their contribution.
The majority of the High Court affirmed Pafburn in holding that the duty of care set out in section 37(1) of the DBPA was non-delegable and therefore section 5Q of the CLA applied. That duty was read to be that “reasonable care is taken by a person in the carrying out of any work or task delegated or otherwise entrusted to the person by the” person owing the duty of care in section 37(1) of the DBPA.
Relevantly, a builder could not entrust the construction work to another person in such a way that would discharge its obligations under the DBPA. Any failure by a subcontractor in the construction works would leave the builder vicariously liable.
Gordon, Edelman and Steward JJ, in their joint judgment, disagreed with this position, stating that the proportionate liability scheme in the CLA should apply to DBPA claims.
Notably, their Honours in the minority also cast doubt as to whether a certifier could be captured under the definition of a “person who carries out construction work”.
To access the High Court decision here.
Authors: Christine Jones & Brandon Thai
Signs emerging that worst is behind building industry
Led by New South Wales and Victoria, encouraging building approval numbers have bolstered hopes that the troubled building industry is at last emerging from the worst of its woes. Matthew Kandelaars, Group Executive Policy and Advocacy, Property Council, said while pleasing to see apartment approvals on the rise, they are still close to half of what was being built over the same period in 2017-18 (2 December 2024). Read more here.
Despite misconceptions about productivity decline, detached home building in Australia remains the most efficient in the world. We debunk the myths surrounding its output and explore how evolving home designs challenge these assumptions
There has been a decline in labour force productivity within the home building industry in Australia. This is then suggested to contribute to the deterioration in the housing supply. These two contentions are premised on the basis that outputs from detached home building have remained constant over recent decades while labour inputs have increased over the same period. This is erroneous and ignores the labour structure in our industry (27 November 2024). Read more here.
New construction watchdog hammers home priorities for Building Commission NSW
NSW’s new Building Commissioner James Sherrard has officially started in his role leading the state’s first dedicated building and construction regulator. His focus builds on the success of the regulator in restoring quality and public confidence, while looking towards further industry reform (5 December 2024). Read more here.
Exploring the Applications of Graphene in Construction
Graphene, a remarkable two-dimensional material made up of sp2 hybridized carbon atoms arranged in a hexagonal lattice, is making waves in the construction industry thanks to its unique properties. Its incredible mechanical strength allows for significant improvements in concrete, making it up to 2.5 times stronger and four times less permeable to water than traditional concrete. This means that structures can be built using less material without compromising safety or durability, potentially cutting CO2 emissions by as much as 30 % (27 November 2024). Read more here.
NSW women in construction winners celebrated for innovation and female leadership
Diversity and inclusion and how they can deliver profound benefits for the nation were the themes among finalists for the National Association of Women in Construction (NAWIC) NSW Chapter’s annual awards for excellence. The not-for-profit organisation is run by women volunteers and allies that host and deliver various events to further women in the construction industry. Last week, the organisation announced its winners (2 December 2024). Read more here.
Recycled materials – how to bridge industry and government responsibility
The transition to a circular economy in the infrastructure sector, where materials are designed to be reused, remanufactured, or recycled, has become a defining imperative. But who is responsible for catalysing the change? Is it government or industry? According to circular economy engineer at Arcadis, Lloyd Parker, significant progress hinges on a collaborative effort between government and industry (5 December 2024). Read more here.
Why foreign buyers are leaving Australia’s property market
The number of Australian homes bought by foreigners fell last year, as high stamp duty costs deter potential buyers. The number of approved residential real estate investments by overseas buyers fell to 5581 in financial year 2024, down from 6576 in 2023 (15 per cent), figures from the Foreign Investment Review Board (FIRB) show. The downturn reflects the government’s efforts to reduce foreign investment and cut migration, experts say (28 November 2024). Read more here.
‘Yes in God’s backyard’: Labor offers cash for church housing
Church groups are signing up for federal funds to build homes for people in need and fill a gap in the broader housing market, prompting the government to offer them more cash if they are willing to release land that has been unused for decades. Housing Minister Clare O’Neil told faith leaders on Tuesday that they stood to gain a bigger share of a $10 billion federal housing fund if they followed the example of Baptists and other churches by using their land for emergency accommodation (3 December 2024). Read more here.
HIA Welcomes Regional Housing Focus in Coalition’s $5 Billion Housing Plan
“The Housing Industry Association (HIA) welcomes the Coalition’s commitment announced today to invest in supporting growth and delivery of housing across regional Australia through its $5 billion Housing Infrastructure Programme,” HIA Chief Executive Industry & Policy, Simon Croft said today (4 December 2024). Read more here.
WMTS:101-2024 | Public Comment Draft Round 1
The draft amendments to this technical specification incorporate the minimum requirements for the connection of commercial catering appliances employed for the preparation, cooking, and holding of food to the water service and sanitary plumbing piping. The ABCB is undertaking consultation to ensure stakeholders are informed of the development of all proposed new or amended Technical Specifications. In undertaking this consultation stakeholders have an opportunity to provide input and/or comment during the Technical Specification's development (5 December 2024). Access the public comment draft here.
New Prefabricated, modular and offsite construction handbook
This handbook was developed in collaboration with Building 4.0 CRC and provides guidance on how to use prefabricated, modular and associated Modern Methods of Construction (MMC) technologies safely, sustainably and in compliance with the National Construction Code (NCC). It helps increase the understanding and effectiveness of existing building standards and regulations, and to respond to government and industry requests for guidance on achieving NCC compliance in buildings that use MMC (22 November 2024). Read the handbook here.
Review of the Fair Work Amendment (Secure Jobs, Better Pay) Act 2022
HIA refers to the joint review of the operation of the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Secure Jobs, Better Pay Act), and amendments made by Part 16A of Schedule 1 of the Fair Work Legislation Amendment (Closing Loopholes) Act 2023 (Closing Loopholes Act) as announced on 2 October 2024 (Review) (28 November 2024). HIA provides this response to the Review here.
Building Approvals, Australia
The Australian Bureau of Statistics released data that showed the total number of dwellings approved rose 4.2 per cent in October to 15,498, after a 5.8 per cent rise in September. Approvals for private dwellings excluding houses (including townhouses and apartments) rose 24.8 per cent to 5,859, to the highest level since May 2023. Single family housing approvals fell by 5.2 per cent in October, after reaching a two-year high in September (2 December 2024). Read more here.
Construction Work Done, Australia, Preliminary
This release provides preliminary estimates of value of total construction work done, building work done and engineering construction work done. In seasonally adjusted terms, in the September quarter, total construction work done rose 1.6% to $73,344.9m, building work done rose 0.7% to $38,638.0m and engineering work done rose 2.6% to $34,706.9m. Overall, the trend estimates for total construction work done rose 0.7% (27 November 2024). Read more here.
Pafburn Pty Limited v The Owners - Strata Plan No 84674 [2024] HCA 49
Tort – negligence – concurrent wrongdoers – proportionate liability – where owners corporation claimed damages from developer and head building contractor for construction of building – where claim for economic loss arising from breach of duty imposed on person carrying out construction work by s 37 of Design and Building Practitioners Act 2020 (NSW) ("DBPA") – where duty to exercise reasonable care to avoid economic loss caused by defects in or related to building arising from construction work – Whether Pt 4 of Civil Liability Act 2002 (NSW) can limit liability for damages for breach of s 37 of DBPA.
Words and phrases – "apportionable claim", "building work", "concurrent wrongdoers", "construction work", "direct liability", "duty of care", "non-delegable duty", "personal liability", "proportionate liability", "statutory duty", "vicarious liability".
Civil Liability Act 2002 (NSW) – ss 5Q, 34, 34A, 35, 39(a).
Design and Building Practitioners Act 2020 (NSW) – ss 7(3), 32, 33, 34, 35, 36(1), 37, 38, 39, 40, 41.
Innovative Builders and Engineers Pty Ltd v Shah [2024] NSWCATOD 196
APPEAL – error of law – adequacy of reasons – no legal basis disclosed for order making director of building company personally liable for breach of contract – failure to determine scope of work under residential building contract before determining damages – appeal allowed – remitted for rehearing.
Civil and Administrative Tribunal Act 2013 (NSW), ss 36, 38, 60, 80, Sch 4, c12; Civil and Administrative Tribunal Rules 2014 (NSW), r 25; Home Building Act 1989 (NSW), ss 7, 10.
The Owners - Strata Plan 82089 v Omaya Holdings Pty Ltd (No 3) [2024] NSWSC 1511
BUILDING AND CONSTRUCTION – contract – defects – where first defendant builder and second defendant developer entered building contract – where plaintiff owners corporation alleges general and fire safety defects – where principal claim arises from contention that the “effective height” of building exceeds 25 metres – whether inadequate fire safety measures for building – construction of the Building Code of Australia – meaning of “effective height” – meaning of “storey” – whether garbage collection area, or, in the alternative, car park entry, is the “lowest storey” of the building.
BUILDING AND CONSTRUCTION – contract – where plaintiff owners corporation alleges a building contract between the second defendant developer and third defendant – where no written contract – where third defendant not licensed to perform residential building works – whether contract may be inferred by circumstances.
Civil Liability Act 2002 (NSW); Design and Building Practitioners Act 2020 (NSW); Environmental Planning and Assessment Act 1979 (NSW); Environmental Planning and Assessment Regulation 2000 (NSW); Home Building Act 1989 (NSW).
Claire Rewais and Osama Rewais t/as McVitty Grove v BPB Earthmoving Pty Ltd (No 2) [2024] NSWSC 1555
COSTS – where successful party seeks indemnity costs – purported Calderbank offer – whether unreasonable for unsuccessful party to reject offer – HELD – offer not take effect as a Calderbank offer – not unreasonable for unsuccessful party to reject offer – variation to costs order to correct naming of first defendant.
COSTS – unsuccessful application for indemnity costs – costs follow the event – HELD – first defendant to pay the plaintiffs’ costs of application.
Building and Construction Industry Security of Payment Act 1999 (NSW) s 25(4)(b); Civil Procedure Act 2005 (NSW) s 98; Home Building Act 1989 (NSW); Uniform Civil Procedure Rules 2005 (NSW) rr 36.16, 42.1, 42.2, 42.4.
Champion Home Sales Pty Ltd v Voulgaris [2024] NSWCATAP 244
HOME BUILDING – enforceability of a builder’s damages clause where the builder had terminated a contract for lack of finance by owner – no certificate of insurance issued to the owner – whether the builder’s claim is for the payment of damages under a contract for residential building work – application of s 92 and s 94 of the Home Building Act – whether work of a preparatory nature is residential building work.
COSTS – Calderbank letter – exercise of discretion for indemnity costs.
Civil and Administrative Tribunal Act 2013 (NSW); Civil and Administrative Tribunal Rules 2014; Home Building Act 1989 (NSW).
The Owners Corporation SP 90832 v Dyldam Developments Pty Ltd [2024] NSWSC 1519
BUILDING AND CONSTRUCTION – Design Act ss 36 and 37 - Certifiers Act ss 13 and 14 – proceedings by Owners Corporation against the third defendant accredited certifier for breach of the duty of care imposed by s 37 of the Design Act on the footing that the third defendant carried out construction work in or related to a residential strata apartment complex – third defendant denies that it carried out construction work and denies that the Design Act can apply by virtue of the existence of a Practice Standard under the Certifiers Act.
PRACTICE AND PROCEDURE – UCPR r. 28.2 – Civil Procedure Act 2005 (NSW) ss 56(1)-(2) – parties frame the following separate question “Did the Third Defendant carry out “construction work” within the meaning of Part 4 of the Design and Building Practitioners Act 2020 (NSW) in respect of the development of the Complex?” – where during argument on the question it emerges that the question will not conduce the just, quick and cheap disposition of the real issues in the case because it is likely to cause delay and the answer lacks utility – order for determination of separate question revoked.
Building and Development Certifiers Act 2018 (NSW); Civil Procedure Act 2005 (NSW); Design and Building Practitioners Act 2020 (NSW); Environmental Planning and Assessment Act 1979 (NSW); Uniform Civil Procedure Rules 2005 (NSW).
Damico v Secretary, Department of Customer Service [2024] NSWCATOD 192
ADMINISTRATIVE LAW – administrative review – contractor licence – painter – fit and proper person.
Administrative Decisions Review Act 1997; Child Protection (Offenders Registration) Act 2000; Home Building Act 1989.
Van der Rijt v Collins [2024] NSWCATAP 247
APPEAL- common property rights by-law- consent required under sections 143 and 149 of the Strata Schemes Management Act 2015.
Civil & Administrative Tribunal Act, 2013 (NSW); Strata Schemes Management Act 1996 (NSW); Strata Schemes Management Act 2015 (NSW).
Chaar v The Owners – Strata Plan 57161 [2024] NSWCATAP 242
APPEAL – error as to date not impacting decision – no basis for grating leave to appeal.
LAND LAW – Strata title – two-year limitation period – date from which that period commences – extension of time not permitted.
Strata Schemes Management Act 2015 (NSW).
COURTS AND JUDGES – Supreme Court – jurisdiction – whether Supreme Court lacked jurisdiction to make declaration that condition of by-law unjust – where statute conferred function of finding condition unjust on NSW Civil and Administrative Tribunal.
LAND LAW – strata title – By-laws – whether condition of by-law that exclusive use rights cease unless obligations complied with unjust – whether condition harsh, oppressive or unconscionable – whether respondents liable in damages under by-law for failure to comply with obligations under by-law – whether respondents liable for reasonable costs and expenses incurred in recovering outstanding levies – whether respondents liable for costs and expenses incurred in claiming damages under by-law.
Civil and Administrative Tribunal Act 2013 (NSW), Sch 4, Subcll 5, 6, 8; Civil Procedure Act 2005 (NSW), ss 56, 98; Contracts Review Act 1980 (NSW), ss 4, 7, 9; Industrial Arbitration Act 1912 (NSW), s 49; Interpretation Act 1987 (NSW), ss 34, 35; Strata Schemes Management Act 2015 (NSW), ss 8, 86, 90, 135, 139, 142, 144, 145, 149, 150.
The Owners – Strata Plan No 89074 v Ceerose Pty Ltd [2024] NSWSC 1494
BUILDING AND CONSTRUCTION – claim for breach of statutory warranties under Home Building Act 1989 (NSW) – proceedings on foot for 8 years – before the Court on 52 occasions – parties reach agreement ‘in principle’ for builder to rectify defects but no final agreement reached more than a year later – owner refuses access to builder to rectify defects – referral to engineer/barrister – 13-day reference – referee provides liability and quantum reports totalling 440 pages.
REFEREE – reference made to facilitate just, quick and cheap resolution – principles at [5]-[9] – whether to adopt report – principles at [10]-[14] – whether interests of justice served.
MITIGATION – obligation on plaintiff to act reasonably – principles and case law review at [38]-[53] – Owners v Di Blasio Constructions considered – whether plaintiff owes duty to allow builder to minimise its damages.
SCOTT SCHEDULES – history and purpose – amendment, at [114]-[118] – whether referee made ruling that defects not in Scott Schedule would not be considered – whether referee denied natural justice by considering defects not in Scott Schedule.
Civil Procedure Act 2005 (NSW), s 56(1); Evidence Act 1995 (NSW), s 69(3); Home Building Act 1989 (NSW), ss 18B, 18BA, sch 4 s 125; Home Building Amendment Act 2014 (NSW); Uniform Civil Procedure Rules 2005 (NSW), rr 2.1, 2.3, 15.2, 20.14(1), 20.17, 20.20, 20.24(1).
Crystele Designer Homes Pty Ltd v Wood [2024] NSWSC 1438
Administrative Law – Judicial Review – Judicial Review of an Appeal Panel of the NSW Civil and Administrative Tribunal Council – relief sought.
Civil and Administrative Tribunal Act 2013 (NSW); Civil and Administrative Tribunal Rules 2014; Civil Procedure Act 2005 (NSW); Competition and Consumer Act 2010 (Cth); Fair Trading Act 1987 (NSW); Home Building Act 1989 (NSW); Supreme Court Act 1970 (NSW).
Proclamations commencing Acts
Aboriginal Land Rights Amendment Act 2022 No 68 (2024-612) – published LW 6 December 2024
Regulations and other miscellaneous instruments
Energy and Utilities Administration Amendment (Abolition of Net Zero Board) Regulation 2024 (2024-601) – published LW 29 November 2024
Environmental Planning and Assessment Amendment (Hornsby Transport Oriented Development Precinct) Regulation 2024 (2024-588) – published LW 27 November 2024
Environmental Planning and Assessment Amendment (Macquarie Park Transport Oriented Development Precinct) Regulation 2024 (2024-589) – published LW 27 November 2024
Final Determination [Biodiversity Conservation Act 2016] (2024-602) – published LW 29 November 2024
Surveying and Spatial Information Regulation 2024 (2024-605) – published LW 29 November 2024
Government Sector Legislation Amendment (Miscellaneous) Regulation 2024 (2024-611) – published LW 4 December 2024
Referable Debt Order (2024-614) – published LW 6 December 2024
Environmental Planning Instruments
Canada Bay Local Environmental Plan (Housing) (Map Amendment No 1) (2024-590) – published LW 27 November 2024
Muswellbrook Local Environmental Plan 2009 (Amendment No 21) (2024-607) – published LW 29 November 2024
Orange Local Environmental Plan 2011 (Amendment No 40) (2024-608) – published LW 29 November 2024
State Environmental Planning Policy (Exempt and Complying Development Codes) Amendment (Miscellaneous) 2024 (2024-609) – published LW 29 November 2024
State Environmental Planning Policy Amendment (Bankstown Transport Oriented Development Precinct) 2024 (2024-591) – published LW 27 November 2024
State Environmental Planning Policy Amendment (Bella Vista and Kellyville Transport Oriented Development Precincts) 2024 (2024-592) – published LW 27 November 2024
State Environmental Planning Policy Amendment (Crows Nest Transport Oriented Development Precinct) 2024 (2024-593) – published LW 27 November 2024
State Environmental Planning Policy Amendment (Exemptions) 2024 (2024-594) – published LW 27 November 2024
State Environmental Planning Policy Amendment (Homebush Transport Oriented Development Precinct) 2024 (2024-595) – published LW 27 November 2024
State Environmental Planning Policy Amendment (Hornsby Transport Oriented Development Precinct) 2024 (2024-596) – published LW 27 November 2024
State Environmental Planning Policy Amendment (Macquarie Park Transport Oriented Development Precinct) 2024 (2024-597) – published LW 27 November 2024
Wollongong Local Environmental Plan 2009 (Map Amendment No 8) (2024-610) – published LW 29 November 2024
Cessnock Local Environmental Plan 2011 (Amendment No 44) (2024-615) – published LW 6 December 2024
Coffs Harbour Local Environmental Plan 2013 (Map Amendment No 12) (2024-616) – published LW 6 December 2024
Hay Local Environmental Plan 2011 (Amendment No 1) (2024-617) – published LW 6 December 2024
Penrith Local Environmental Plan (Industry and Employment) (Map Amendment No 3) (2024-618) – published LW 6 December 2024
Shoalhaven Local Environmental Plan 2014 (Amendment No 55) (2024-619) – published LW 6 December 2024
Bills assented to
Royal Botanic Gardens and Domain Trust Amendment Act 2024 No 86 – Assented to 02 December 2024
State Insurance and Care Governance Amendment (Governance Arrangements) Act 2024 No 88 – Assented to 02 December 2024
Revenue Legislation Further Amendment Act 2024 No 90 – Assented to 02 December 2024
Environmental Planning and Assessment Amendment (State Significant Development) Act 2024 No 91 – Assented to 02 December 2024
Transport Administration Amendment (NSW Motorways) Act 2024 No 95 – Assented to 02 December 2024
Biodiversity Conservation Amendment (Biodiversity Offsets Scheme) Act 2024 No 96 – Assented to 02 December 2024
Disclaimer
The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this newsletter is accurate at the date it is received or that it will continue to be accurate in the future.
Published by:
