BLB1101 Australian Legal System: Owners Corp v. Lu Simon VCAT Case

This case study provides an analysis of the Owners Corporation v. Lu Simon Builders Pty Ltd VCAT case, focusing on the breach of contract and negligence claims. It examines the legislative aspects, including the Domestic Building Contracts Act 1995, the Wrongs Act 1958, and the Building Act 1993. The analysis covers the liabilities of the respondents, referencing landmark cases like Donoghue v Stevenson and Grant v. Australian Knitting Mills. Alternative Dispute Resolution methods, such as arbitration and mediation, are also discussed. The study concludes that the Civil Division of the Victorian Civil and Administrative Tribunal acted appropriately in its ruling, backed by relevant legislation and case law.

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Judgement analysis

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Table of Contents
Part A.........................................................................................................................................3
Analysis of the case: Background and hearing......................................................................3
Legislative aspects.................................................................................................................3
Bibliography...........................................................................................................................5
Part B..........................................................................................................................................6
Introduction............................................................................................................................6
Liabilities of respondents: A critical overview......................................................................6
Landmark cases......................................................................................................................7
Alternative forms of Dispute Resolution...............................................................................8
Evidence and reasons for the opinion....................................................................................8
Conclusion..............................................................................................................................8
Bibliography.........................................................................................................................10

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Part A
Analysis of the case: Background and hearing
The case is between the Owners Corporations and Lu Simon Builders Pty Ltd and others
before the Civil Division of the Victorian Civil and Administrative Tribunal at Melbourne1.
The facts of the case imply the breach of contract on part of Lu Simon by acting in
contravention of the warranties as per the provisions enshrined and envisaged in the
Domestic Building Contracts Act of 19952. The hearing before the Civil Division of the
Victorian Civil and Administrative Tribunal commenced only on the making of written and
oral submissions by both the parties to the case. The documentation used during the
proceedings of the case was primarily in electronic format. As a result, the staff of the court
displayed the documents to the witnesses involved in the case in computer screens at the
respective witness boxes. The onus rested on any party to raise questions upon the relevancy
and validity of any document provided that these kinds of questions are raised at the earliest.
Even though there was a short debate pertaining to the relevancy and validity of some
documents, both the parties agreed upon the finality of the documents to be presented in the
tribunal and subsequently, a full list of documents were submitted to the tribunal by the
solicitors representing Lu Simon.
Legislative aspects
The Civil Division of the Victorian Civil and Administrative Tribunal ruled against the
respondents holding them liable for breach of the Consultant Agreement and failure to
undertake due diligence thereby being directed to pay damages to the applicant as per the
provisions envisaged and incorporated under Part IV AA of the Wrongs Act of 19583. The
Building Act of 1993 has also been delved into for the purpose of the understanding of the
standards related to works pertaining to construction of buildings4. Section 7 of the Building
Act of 1993 implies that the Governor-in-Council has the power to formulate and pass
regulations for the purpose of to construction of buildings. The Building Act of 1993 is of
great importance as it lays down the procedures which are pertinent to the issuance of permits
1 Owners Corporation No.1 of PS613436T, Owners Corporation No. 2 of PS613436T, Owners Corporation No.
4 PS613436T & Ors v Lu Simon Builders P/L, Stasi Galanaos, Gardner Group & Ors [2019] VCAT 350/2016
2 Domestic Building Contracts Act 1995 (Vic.)
3 Wrongs Act 1958 (Vic.)
4 Building Act 1993(Vic.)

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relating to construction of buildings and occupancy. Such permits would aid in the resolution
of conflicts in an effective and efficient manner pertaining to the matters related to
construction of buildings and occupancy. Sub-section 1 of Section 16 of the Building Act of
1993 implies that work must not be commenced unless a building permit has been issued.
Such a provision also implies that the work is in compliance with the Act, Regulations and
permit. The Building Code of Australia has played an extremely important role with regard to
the resolution of the issues which were pertinent to the case in order to conclude upon a
comprehensive judgement by the Civil Division of the Victorian Civil and Administrative
Tribunal5. In accordance with Regulation 109 of the Building Regulations of 2006, the
Building Code of Australia is treated as a legislation that can be construed as per the rules of
statutory interpretation6.
5 Building Code of Australia 2018
6 Building Regulations 2006 (Vic.)

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Bibliography
Building Act 1993 (Vic.)
Building Code of Australia 2018
Building Regulations 2006 (Vic.)
Domestic Building Contracts Act 1995 (Vic.)
Owners Corporation No.1 of PS613436T, Owners Corporation No. 2 of PS613436T, Owners
Corporation No. 4 PS613436T & Ors v Lu Simon Builders P/L, Stasi Galanaos, Gardner
Group & Ors [2019] VCAT 350/2016
Wrongs Act 1958 (Vic.)

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Part B
Introduction
Various observances can be made from the judgment made by the Civil Division of the
Victorian Civil and Administrative Tribunal at Melbourne in the case of Owners
Corporations v. Lu Simon Builders Pty Ltd and others. It is implied form the case that the
judgement was passed against the respondents Lu Simon Builders Pty Ltd and others thereby
holding them liable on various grounds. The Civil Division of the Victorian Civil and
Administrative Tribunal also followed the principles of natural justice with regard to the
hearing of both the sides taking account of the doctrine of Audi Alteram Partem which means
that both the sides should be heard by the court or tribunal depending upon the scenario of the
case. The International Fire Engineering Guidelines were delved into by the tribunal in this
case.
Liabilities of respondents: A critical overview
The construing of the Building Code of Australia was prayed before the Civil Division of the
Victorian Civil and Administrative Tribunal by one of the respondents, the Gardener Group
in their averment. However, the Civil Division of the Victorian Civil and Administrative
Tribunal concluded that the Gardener Group acted in contravention of Section 18 of the
Australian Consumer Law which is the Second Schedule of the Competition and Consumer
Act of 20107. In this aspect, the tribunal found that the Gardener Group failed to exercise
reasonable care with respect to due diligence thereby acting in a negligent manner. As a
result, the tribunal relied upon the judgement made by the Court of Appeal of New South
Wales in the case of Heydon v. National Road and Motorists Association Ltd. with respect to
deceptive means in the providing of legal advice. The case of Boland v. Yates Property
Corporation was also referred to by the Civil Division of the Victorian Civil and
Administrative Tribunal regarding the success and failure of results in a simultaneous manner
in a case where negligence and deception are pertinent to the same kind of material facts8.
The respondent Elenberg Fraser was unable to provide whether the design for the building
complied with the requirements of legislation, most notably the Building Code of Australia.
The respondents Elenberg Fraser, the Gardener Group and Thomas Nicolas have acted in
contravention of the provisions of breach of contract thereby failing to exercise reasonable
7 Competition and Consumer Act 2010
8 Boland v. Yates Property Corporation (1999) 167 ALR 575

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care and acting in negligence as far as the undertaking of the duties and obligations are
concerned.
Landmark cases
As Australia is under the ambit of the jurisdiction of the common law of England and Wales,
the cases which have set precedents can be referred to by the court or judicial authority
established by law to exercise jurisdiction comprehensively. In the case of Donoghue v
Stevenson, the plaintiff fell ill after consuming a ginger beer in which a snail was found to be
floating9. As a result she was not only diagnosed with gastroenteritis but also experienced
panic attacks thereby being admitted at the Royal Infirmary at Glasgow. In this case, it was
held by the House of Lords that the defendant failed to take any reasonable care thereby
acting in negligence of the duty it owed to the plaintiff. The judgment of the case implies that
the manufacturers owe a duty of care to the people who are potential consumers of their
goods and services. The case has acted as a precedent for many cases with regard to the
serving as guideline for courts and tribunals in order to determine and identify the aspects for
concluding upon the finality of the judgement. The principles regarding the legalities
involved in the duty of care have been established by the case. In the case of Grant v.
Australian Knitting Mills, the purchaser experienced skin irritation as a result of wearing
woolen underwear10. Later on, it was found out that the garments contained massive amounts
of sulphur dioxide and sulphites. In this case, it was held by the High Court of Australia, if a
manufacture fails take reasonable care of the consumer, it acts in breach of its legal duty of
care thereby acting in negligence. It is one of the landmark cases in Australian Law related to
the welfare of and protection of the consumers. In the case of Home Office v Dorset Yatch
Company, a group of boys were taken by the Home Office to Brownsea Island. The boys who
escaped at night had a collision with a yacht when they were yachting. As a result, the owners
of the yacht filed a suit against the Home Office on grounds of negligence11. In this case, it
was held by the House of Lords that the Home Office was liable for negligence as it had
acted in breach of its duty to undertake reasonable care of the boys thereby failing to prevent
them from escaping. As a result, it can be observed from the case of Owners Corporations v.
Lu Simon Builders Pty Ltd and others that the Civil Division of the Victorian Civil and
Administrative Tribunal at Melbourne has acted in a proper and appropriate manner thereby
deriving a comprehensive solution with regard to the making of a ruling against the
9 Sarah Healy,. "Swimming against the Tide." (2016) 6 King's Inns Student L. Rev. 39
10 Geraint Howells and Stephen Weatherill. Consumer protection law. (Routledge, 2017)
11Ken Oliphant and Donal Nolan. Tort law: text and materials. (Oxford University Press, 2017)

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respondents, Lu Simon Builders Pty Ltd. taking account of the precedents set by the courts in
the cases as aforesaid.
Alternative forms of Dispute Resolution
It can also be stated that there are alternative forms of dispute resolution instead of litigation
in order to save time and costs. Such alternative forms of dispute resolution include
arbitration, mediation and conciliation. Taking account of the merits of the case, it can be
observed that the best alternative form of dispute resolution would be arbitration. In this
regard, the Commercial Arbitration Act of 2011 would be delved into for the purpose of
understanding the procedures relating to the appointment of arbitrators and the significance
and validity of the arbitral award as far as the facts of the case are concerned12. The
Melbourne Commercial Arbitration and Mediation Centre may also have an important role to
play in this regard with reference to the resolution of the dispute through alternative means.
The means of Alternative Dispute Resolution which can be exercised by the Civil Division of
the Victorian Civil and Administrative Tribunal is mediation as per Section 88 of the
Victorian Civil and Administrative Tribunal Act of 1998. It would also help the people
residing in the Australian state of Victoria to a great extent with regard to the resolution of
their disputes.
Evidence and reasons for the opinion
The primary reason for the opinion by the Civil Division of the Victorian Civil and
Administrative Tribunal is to ensure that negligence is prevented and due care is to be
exercised while providing services. The rationale behind such an opinion is also inclusive of
the fact that the respondents acted in contravention of the Consultant Agreement thereby
leading to breach of contract. The evidences are backed up by appropriate legislations and
case laws as aforesaid.
Conclusion
As observed from the aforesaid part, it can be concluded by stating that the critical overview
pertaining to the liabilities of the respondents has been justified and are appropriate. It is also
imperative that the cases and relevant legislations have been mentioned accordingly in order
to comprehend upon the decision of the Tribunal. The procedures related to mediation on part
of the Victorian Civil and Administrative Tribunal has also been considered in order to imply
the concept of Alternative Dispute Resolution.
12 Vicki Waye, "Mandatory mediation in Australia’s civil justice system." (2016) 45(2-3) Common Law World
Review 214-235.

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Bibliography
Boland v. Yates Property Corporation (1999) 167 ALR 575
Competition and Consumer Act 2010
Sarah Healy,. "Swimming against the Tide." (2016) 6 King's Inns Student L. Rev. 39
Geraint Howells and Stephen Weatherill. Consumer protection law. (Routledge, 2017)
Ken Oliphant and Donal Nolan. Tort law: text and materials. (Oxford University Press, 2017)
Vicki Waye, "Mandatory mediation in Australia’s civil justice system." (2016) 45(2-3)
Common Law World Review 214-235.