Case Reports

Court of Appeal considers meaning of “building work” and “building action” of the Building Act 1993 (Vic)

In McAskell & Anor v Timelink Pacific Pty Ltd & Anor [2010] VSCA 79 (15 April 2010), the Victorian Court of Appeal concluded that a claim arising out of faults in the footings (“site preparation”) was statute-barred by s 134 of the Building Act 1993 (Vic).

Applicable provisions: s 134 provides, in effect, that – notwithstanding any other period of limitation – a ‘building action’ cannot be brought more than 10 years after the issue of the relevant occupancy permit. Section 129 defines ‘building action’ to include an action ‘for damages for loss or damage arising out of or concerning defective building work’. Section 3(1) defines ‘building work’ as ‘work for or in connection with the construction… of a building’.

Background

In this case, the permit was issued in February 1997, and the litigation did not commence until May 2007. The trial judge held that the proceeding was ‘wholly a building action’, and that it was therefore ‘wholly statute barred’ by operation of s 134. His Honour concluded that it was “artificial” to distinguish the “site preparation works” from the construction of the footings themselves. The builders were engaged under a single contract to perform both the site preparation works and the work of constructing the buildings. The approved plans (and building permit) made specific reference to the site preparation. Consequently, the trial judge concluded that the construction of the building, and in particular the construction of the footings, followed on from, and was directly connected to, the site preparation works.

Appeal

On Appeal, the Appellants sought to get around the 10 year cut off period by linking the relevant breach with site preparation works (which are not part of the building), as distinct from the footings (which were part of the building). They submitted that:

• Time began to run when the defects were first noticed in or about January 2000; and
• Section 134 is not relevant, because the flaw in the unit was not the result of any fault in the Respondents’ ‘building work’ itself. The problem was solely attributable to the Respondents’ site preparation works which did not constitute ‘building work’ for the purposes of the Act, because it was not work in connection with the construction of the unit, nor was it work for which a building permit was required.

Two principal grounds were advanced by the Appellants:

• That the trial judge should have decided the question by reference to the nature of the works themselves. The Appellants contended that ‘building work’, for the purposes of the Act, is only work that requires a permit, which should be determined by the nature of the work, and not by reference to whether the work is to be performed under one contract, or by one party, or included in a drawing.
• The requirement “connected with” under s 3 of the Act should be confined to activities undertaken after the commencement of the construction of the building, and not extend to preparatory site works.

The Court of Appeal concluded that, firstly, the question should have been decided by reference to the nature of the works themselves, and secondly, the trial judge had so decided. The Court of Appeal agreed with the trial judge that it was “artificial” to distinguish “site preparation works” from the construction of the footings themselves, and to then allocate the (acknowledged) breach of duty solely to site preparation.