Never-ending building litigation at VCAT

Never ending building litigation at VCAT…

I hear it all the time:

• We have defect proceedings at the VCAT or the County Court; and

• The builder is dragging out the proceedings, you name the reason - multiple requests for further and better particulars, amended pleadings… again, mediation, another mediation then compulsory conference, failure to comply with orders, failed discovery, delayed witness statements. Joinder after joinder…

I have heard it all… basically everything short of the ‘dog ate the paperwork’.

The system is a mess particularly regarding delays and the extent of poor builder workmanship in Victoria.

AND Applicants and Plaintiffs in building litigation just want a result (usually damages to fix their home)…

That should not be unreasonable - particularly in Victoria given the implied warranties provided by a builder under the Domestic Building Contracts Act 1995 (Vic).

However, most builders know that time is on their side and if they pay now, or at mediation, they want a discount!

And trial can be waited for many years.

So what to do… there are options to just litigating in the old way. In fact, to succeed often unique strategies need to be employed. A couple of more common options we see include:

Settlement against certain parties

• Many of the cases I see have multiple building practitioners relevant to the defects and proceedings (eg plumbing defects in addition to other building defects).

• Settlement can be advantageous to settle claims against certain parties.

• Given the delays with VCAT this is becoming a more viable option. It is complicated and requires the right advice, but it can provide financial relief while proceedings continue against a builder.

• If you are a legal practitioner or Applicant and considering these avenues feel free to reach out. We have dealt with this issue on more than one occasion.

Sale of the property

• This is often never wanted or easy but in some cases AND with proper disclosure this can be done with minimal risk.

• There obviously needs to be disclosure of material facts and advice by a competent conveyancer in addition to litigation lawyers.

• And just because you sell a property doesn’t mean your proceedings are necessarily at an end. You can potentially claim for loss of value.

Offers (Calderbank, Rules and Section 112 - 113) are also critical. I have written about the effectiveness of these in other articles… so I won’t repeat here.

Remember in many cases it may take 3 - 5 years and potentially longer to get an outcome at trial at VCAT. And that journey is fraught with the risk of builder insolvency. The system is truly in a mess in Victoria.

But you do have options which need to be carefully evaluated at different junctures of proceedings and a strategy that suits your circumstances.

This article is a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Tagged as:

• property disputes