Costs Order for builder and developer against Strata Plan (Owners Corporation)

In the recent decision by the NCAT Appeal Panel in Bright Build Pty Limited v The Owners – Strata Plan No 94514 - NSW Caselaw [2021] NSWCATAP 163, G&S Law Group successfully obtained an Indemnity Costs Order on behalf of a Builder and Developer against an Owners Corporation.

Background

G&S Law Group recently acted for a Builder and Developer of a Residential Apartment building in Burwood, NSW, for a defects claim commenced by the Owners Corporation of the building, in the NCAT building division, before Senior Member, G Meadows. The Owners were represented by Bannerman Lawyers.

Whilst the matter was in its preliminary stages, G&S Law Group having considered the matter commercially, advised the builder and developer of the residential apartment building to agree to rectify the defects for the Owners, on the basis that the legal costs to be incurred would be the same amount of the cost of rectification.

G&S Law Group on behalf of the Developer and Builder, made an Offer of Compromise to the Owners Corporation, to rectify all defects for the Owners, which was rejected by their representatives Bannerman Lawyers.

The basis for the Offer being rejected by the Owners Corporation was that a Deed of settlement needed to be entered into by the parties. The Deed provided for a wish list of items in relation to the alleged defects to be rectified by the Developer and Builder and included a new Homeowners Warranty Policy to be provided, a monetary bond to be paid, among other things.

Further, the Owners Corporation was of the opinion that the cost of the remediation would exceed the NCAT Tribunal's jurisdictional monetary limit of $500,000, and needed to be transferred to the Supreme Court of NSW.

Whilst G&S Law Group successfully managed to challenge and overturn a vast number of the defects claimed by the Owners Corporation, NCAT at first instance determined that the Developer and Builder should pay the costs of the Owners Corporation. 

NCAT Appeal Panel

G&S Law Group, on behalf of the Developer and Builder lodged an appeal to the NCAT Appeal Panel. The NCAT Appeal Panel comprised Senior Member, G K Burton SC & Senior Member, A R Boxall.

Amongst other reasons it was found that Senior Member, G Meadows in his original decision had erred in finding that the Owners Corporation was entitled to continue to “push for a settlement which contained unreasonable terms for the rectification of the building defect items”.

NCAT Appeal PanelDecision:

(1) Leave to appeal the Original NCAT decision was granted.

(2) The Appeal by the Developer and Builder was allowed.

(3) The Owners Corporation to pay the Developer and Builder costs of the proceedings on the indemnity basis as agreed or assessed, from the date of the Calderbank Offer.

To ensure you have a commercially, results driven legal team for you building and construction litigation matter, contact G&S Law Group. 

For the Full decision, see link below:

Bright Build Pty Limited v The Owners – Strata Plan No 94514 - NSW Caselaw