Bellini v Meldan (Vic) Pty Ltd (Building and Property) [2021] VCAT 833 

Jeanette Barbaro, Tom Kearney, Michelle Yu

Key takeouts

Claims for breach of the implied warranty under the Domestic Building Contracts Act 1995 (Vic) (DBC Act) to carry works out in a ‘proper and workmanlike manner and in accordance with the plans and specifications set out in the contract’ are not apportionable.

Where previous case law appeared to suggest that claims for breach of the warranty under section 8(a) may be apportionable, this decision clarifies that only claims arising from the breach of subsection 8(d) (a warranty that ‘the work will be carried out with reasonable care and skill’) of the DBC Act may be apportionable.

Facts

In 2013, the applicants (owners) purchased a property. As subsequent owners of the property, they were entitled to the benefit of the implied warranties under section 8 of the Act.

The owners alleged a number of building defects, such as defective construction of a fence, leaky showers and inadequate painting, and issued proceedings alleging breach of the implied warranties under the DBC Act.  The owners sought damages from the first respondent (builder) and second respondent (building surveyor) for the cost of defect rectification and the cost of alternative accommodation.

The builder sought to limit its liability by relying upon the apportionment provisions of the Wrongs Act 1958 (Vic).

The questions before the Tribunal were :

• Whether the claims for each defect were apportionable between the builder and building surveyor.
• The amount of damages awarded for each defect, on the basis of expert evidence provided.

Decision

The Tribunal held that:

• breaches of the warranties under subsections 8(a) to (c) and (e) to (f) of the DBC Act are not apportionable as they do not arise from a failure to take reasonable care; and
  
• breach of the warranty under subsection 8(d) (that ‘the work will be carried out with reasonable care and skill’) of the DBC Act may be apportionable.

The terms in which the claim is framed are an essential determinant of whether a claim can be said to arise from a failure to take reasonable care.  Therefore, a claim for breach of the warranty under subsection 8(d) of the DBC Act may not be apportionable, even if the respondents fail to use reasonable care if the claim is not framed correctly.