Deane Projects Building Pty Ltd v Kinda Kapers Holdings Pty Ltd [2020] NSWDC 622

Deane Projects Building Pty Ltd v Kinda Kapers Holdings Pty Ltd [2020] NSWDC 622

The contract's express variation and latent condition provisions, clauses 9 and 14, exclusively governed the parties' rights. The Builder did not prove a contractual variation of clause 9 or incorporation of a different regime by prior course of dealing, and its quantum meruit claim failed because the disputed work was governed by a subsisting enforceable contract. Accordingly, disputed variations not compliant with clauses 9 or 14 were rejected, while conceded or valuation-only variations were allowed or referred. On the cross-claim, neither clause 4(d) nor clause 21 barred claims for defects that did not appear at practical completion; established non-compliance with the BCA, Australian...

Jurisdiction
Australia
Judgment Date
19 October 2020
Procedural Posture
Civil Building and Construction Contract Dispute With Cross Claim for Defective Works / Principal Judgment After Hearing; Liability Findings Made and Quantum Issues to Be Referred to a Referee
Outcome
The Builder succeeded only in relation to admitted or specified variation, interest, profit margin and GST components, failed on the remaining contested variations and failed on quantum meruit; the Owner substantially succeeded on the defective works cross-claim, with quantum of variations, margins, interest, GST...
Legal Topics
['variation Claims Under Commercial Building Contract' 'prior Course of Dealing and Implied Terms' 'quantum Meruit' 'defective Building Works' 'defects Liability Period' 'design Defects' 'rectification Damages' 'referral of Quantum Issues']
['contracts' 'building and Construction' 'damages' 'practice and Procedure'] ['variation Claims Under Commercial Building Contract' 'prior Course of Dealing and Implied Terms' 'quantum Meruit' 'defective Building Works' 'defects Liability Period' 'design Defects' 'rectification Damages' 'referral of Quantum Issues']

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Procedural Posture

Civil Building and Construction Contract Dispute With Cross Claim for Defective Works / Principal Judgment After Hearing; Liability Findings Made and Quantum Issues to Be Referred to a Referee

Legal Issues

  1. 1 ['Whether clause 9 of the commercial building contract governing variations was varied by a mutual understanding or supplemented by an implied term arising from prior course of dealing.' 'Whether the Builder established entitlement to disputed variation claims, including under clause 14 for unforeseen site conditions.' "Whether the Builder had an alternative claim in quantum meruit for disputed variations where the parties' rights were governed by a subsisting contract." "Whether clauses 4(d) and 21 of the contract barred the Owner's cross-claim for defective works after the defects liability period." 'Whether the Builder was liable for alleged defects involving non-compliance with the BCA, Australian Standards or National Construction Code, including where the Builder characterised some matters as design defects.' 'Whether rectification works for the established defects were necessary and reasonable.']

Ratio Decidendi

The contract's express variation and latent condition provisions, clauses 9 and 14, exclusively governed the parties' rights. The Builder did not prove a contractual variation of clause 9 or incorporation of a different regime by prior course of dealing, and its quantum meruit claim failed because the disputed work was governed by a subsisting enforceable contract. Accordingly, disputed variations not compliant with clauses 9 or 14 were rejected, while conceded or valuation-only variations were allowed or referred. On the cross-claim, neither clause 4(d) nor clause 21 barred claims for defects that did not appear at practical completion; established non-compliance with the BCA, Australian...

Court Disposition

The Builder succeeded only in relation to admitted or specified variation, interest, profit margin and GST components, failed on the remaining contested variations and failed on quantum meruit; the Owner substantially succeeded on the defective works cross-claim, with quantum of variations, margins, interest, GST...

Orders

  • ['Allowances are to be made for admitted variations 2, 5, 9, 10 and 11 in progress claim 13.' 'Variation 1 is rejected.' 'The Builder is entitled to full allowance for variation 3.' 'For variation 6, component (a) valuation is to be referred to a referee; components (b) and (c) are rejected.' 'Variation 7 is...