In Dyldam Developments Pty Ltd v Mewing [2017] NSWCATAP 170, the Appeal Panel dealt with an appeal from a transfer order.

The Owners claimed $500,000 from the Builder. The expert evidence served by the Owners quantified the claim at $495,587. The Tribunal below noted that the sum came “precariously close” to the $500,000 limit for building claims in the Tribunal.

The Owners subsequently realised that the figure arrived at by the expert had not included an allowance for preliminaries or a builder’s margin. The Owners made an application for the transfer of the proceedings to the District Court of New South Wales, noting in their submissions an intention to increase the amount sought in their claim. The Tribunal granted the transfer.

The Builder sought leave to appeal the transfer order, which is interesting in itself as on one view it shows the Builder’s preference for the matter being heard by the Tribunal over the District Court.

The Builder relied on the decision in Owners Strata Plan No 70030 v Decon Australia Pty Ltd [2014] NSWSC 347 (Decon). In Decon, the Tribunal had dismissed a claim in the context of various timetable breaches. It did so notwithstanding an application by the Owner to transfer the proceedings to the District Court having regard to an expert report quantifying the claim at more than $500,000. On appeal it was found that the application filed is the foundation of the Tribunal’s jurisdiction and that the Tribunal continued to have jurisdiction to hear and determine the claim which had not been amended to refer to an amount exceeding the monetary limit. (The appeal was however allowed).

The Appeal Panel distinguished the present case from Decon (which it noted was about whether the Tribunal was correct in dismissing the proceedings in the circumstances of a jurisdiction challenge), noting that it had been “on the record” that the Owners’ claim came close to the $500,000 limit since proceedings were initiated. It also looked to the factors which motivated the Tribunal to transfer the proceedings to the District Court, which were:

  1. The fact that the Owners had realised that the amount of the claim ascertained from expert evidence did not include preliminaries and a builder’s margin;
  2. The Owners’ desire to amend their claim to reflect those other costs, which if successful, would exceed the jurisdiction of the Tribunal; and
  3. The Tribunal’s view that the application to amend the claim should be considered by a Court that would retain the jurisdiction to then determine the claim, should the application be successful.

As such, the Appeal Panel concluded that the Builder had failed to prove an error of law.

To avoid such controversies it may be preferable to apply to amend an application prior to or as part of a transfer application.