Builder Ordered to Pay over $128,000 to Homeowner Over Delayed and Defective Works

In a recent decision by the Victorian Civil and Administrative Tribunal (VCAT), Berrin Demir successfully claimed $128,836.84 in damages from Vision Built Pty Ltd, trading as Vision Group and represented by its director, Mr Anastasios Gatsios, over defective and incomplete building works on her Doncaster property. The case centred on delays, defective workmanship, and the builder’s unlawful suspension of work, which led to the termination of the contract by the homeowner.

Contract Details and Dispute Overview

The contract, signed in February 2017, required Vision Built to construct a high-end brick veneer home with a basement and pool for a price of $1,207,369, inclusive of GST. The project, due for completion in May 2018, experienced significant delays and disputes over progress payments, defective work, and the builder’s suspension of work. By August 2019, Ms. Demir terminated the contract, citing the builder’s failure to address substantial breaches.

Key allegations against the builder included:

• Failure to complete the works within the agreed timeline.
• Defective workmanship in several areas.
• Wrongfully claiming and retaining progress payments.
• Unlawfully suspending works.

Defects in the Works

Multiple defects were identified in the builder’s work, with a total rectification cost of $66,808. Notable issues included:

1. Windows and Doors: Scratches and inconsistencies in the powder coating required repairs costing $42,247.
2. Entry Porch Roof: Water pooling due to faulty flashing and box guttering required $5,065 in rectifications.
3. Flooring: Uneven flooring in one area necessitated levelling at a cost of $2,894.
4. Northern External Wall: Foam cladding was used instead of brick as specified in the plans, costing $10,952 to rectify.
5. Other Issues: Chipped brickwork, improperly installed ventilation, and stained garage walls were among the additional defects.

Tribunal Findings

VCAT ruled that the builder was in substantial breach of the contract, particularly for claiming progress payments prematurely and unlawfully suspending the works. The Tribunal found:

• Liquidated damages for delays amounted to $38,628.57, with rates of $250 per week until June 2018, increasing to $600 per week thereafter.
• Ms. Demir was entitled to $22,686.13 for alternative accommodation costs incurred between the contract’s termination and the home’s completion.

VCAT allowed for deductions of $42,883.98 to account for work covered under the builder’s invoices but upheld the homeowner’s right to recover costs for rectifications and completion.

Costs to Complete the Works

After terminating the contract, Ms. Demir engaged another contractor to complete the works, incurring a total cost of $88,508.30. Major expenses included:

• Plumbing and Scaffolding: Completion and rectification of plumbing works cost $23,145.69, including scaffolding for safe access.
• Supervision and Oversight: The contractor was paid $33,000 for managing subcontractors to complete the build.
• Electrical and Painting Works: Final electrical fit-offs and painting cost $3,648.70 and $4,455 respectively.

Final Outcome

The Tribunal ordered Vision Built Pty Ltd to pay $128,836.84 to Berrin Demir, a decision that reinforces the importance of holding builders accountable for their contractual obligations and workmanship standards.