Home Building Act 1989 (NSW) – Home Building Regulations (NSW) – statutory warranties – defects
The defence available to a contractor under section 18F of the Home Building Act 1989 (NSW) (Act) is the only defence that can successfully rebut a claim in respect of the breach of a statutory warranty under a contract to which the Act applies.
On 7 February 2013 Mr Christopher Brooks (homeowner) contracted with the respondent, Gannon Constructions Pty Ltd (builder) to complete residential building work within the meaning of the Act (contract). The homeowner subsequently made an application in the Civil and Administrative Tribunal of New South Wales (Tribunal) for defective works which the homeowner alleged amounted to a breach of statutory warranty pursuant to section 18B of the Act. The builder sought to rely on the terms of the contract which stated that the liability of the builder for a failure to comply with all 'relevant codes, standards and specifications that the work is required to comply with under any law' may be limited if the failure relates solely to a design or specification prepared by or on behalf of the owner. The builder did not seek to rely on the defence contained in section 18F of the Act, which states that 'In proceedings for a breach of a statutory warranty, it is a defence for the defendant to prove that the deficiencies of which the plaintiff complains arise from instructions given by the person for whom the work was done contrary to the advice in writing of the defendant or person who did the work'. The builder submitted that the statutory defence did not limit the builder's right to rely on an alternate contractual defence, and that, properly construed, the words of section 18F of the Act mean that other defences remain available to the builder.
The Tribunal found that the steel structure provided by the builder was not fit for purpose, in breach of section 18B of the Act, and made a money order of $105,836.57 in favour of the homeowner in accordance with section 48O of the Act.
- the explanatory memorandum to the bill in which the defence in section 18F of the Act was first introduced; and
- obiter in the cases of Pham v Broadview Windows Pty Ltd & Ors  NSWCTTT 375; The Craftsmen Restoration and Renovations v Thomas Boland, Thomas Boland v The Craftsmen Restoration and Renovations  NSWSC 660; and Pastrovic & Co Pty Ltd v Farrington  NSWDC 94,
the Tribunal found that, in respect of a claim for a breach of statutory warranty, the only defence available to a contractor is that contained in section 18F of the Act. The builder was therefore unable to rely on its contractual defence.
Relevantly, the Tribunal noted that while amendments had been made to the Act since the date that the parties contracted which operate to extend the defence available to contractors who rely on instructions given by a person who is a relevant professional (acting for the person for whom the work was contracted to be done), those amendments were not applicable in this case. However the Tribunal noted that, while the amendments are not determinative of whether section 18F of the Act is the only defence for a breach of statutory warranty, the expansion of the defence available under section 18F of the Act is consistent with the finding that it was the intention that section 18F of the Act be the only defence for breach of statutory warranty.