It's worth nothing that for cases brought before VCAT where the claim is over $100,000 (after costs) a 60 per cent of claim win is usually as good as it gets, and that's likely only if you have a capable team that helps you to keep your resolve.
But one weak link and you can really suffer… and would probably have been better off not going there. That sounds most unfair I know, but one wrong path or hiring a less-than-expert building consultant, or an inept solicitor and even a barrister who fails to protect you in a Compulsory Conference (and makes you lose your resolve)… and you could actually finish up with all of the defects and a huge bill to add insult to injury.
In order to win anything in VCAT, the most important thing to have is resolve… and a barrister not defending you against the VCAT member barrage in a compulsory conference could well weaken your resolve to the point that you give up.
The Compulsory Conference barrage is the last ditch approach of VCAT members to get both sides to wake up and agree to an amount that nobody is satisfied with, but which will stop you going to a full hearing where one or both sides potentially face enormous costs incurred in a VCAT Hearing.
VCAT has to do this because the VCAT Act and the Building Act and the government require that your dispute be EXPEDITED. I suggest that you look up the full meaning of the word ‘expedite’ in the dictionary… and you will see it basically means… ‘Make your dispute go away with as little fuss as possible and as fast as possible’.
The Victorian Government has legislated to form a new authority… DBDRV (Domestic Building Dispute Resolution Service)… a compulsory first stop where head banging takes place right at the start, in the hope that both parties will crawl back into their boxes.
The DBDRV is to be presided over by a Conciliator who must be a ‘person’ (no kidding), and the authority’s assessors who supposedly give their professional opinions as to the efficacy of the claimed defects do not have an official definition of defect. They are very similar to their predecessor the BCAV (Building Advice and Conciliation Victoria) which in about 2002 boasted that they expedited 81% of potential disputes on the telephone over its first year.
It is most unfair of the government NOT TO REQUIRE that every person in charge of a compulsory conciliation (deciding on defects) be thoroughly conversant with building terminology, building construction and related concepts… someone such as a builder or an architect. My guess is that they will be legally trained as an arbitrator or mediator… but as earlier stated, they must be a person… so they will not be a talking chimpanzee or a parrot.
If you have been poorly advised by a building consultant with no thorough definition of defect, the chances are that you will lose your case (after costs). So quitting your case before a hearing is indeed likely to be in your best interests.
Apart from cases under $10 000 (where legal help is NOT permitted and everyone agrees to pay their own costs); you basically need to win a substantial amount, although the VCAT act does not say that directly. We do know from one precedent… Stiff v Freeform, that $99 000 was considered substantial in the Supreme Court… so I suggest that you need to be awarded an amount of about $50 000 or even more to generally avoid costs. If you come in at under this amount then you had best be awarded at least $30 000, because that is likely to be the least amount that your costs are going to be.
So you need to have a fairly large costly list of legitimate defects in your claim… and this ties in with the third of 3 basic requirements:-
- If you have (a strong legitimate claim) VCAT will order your costs to be paid by your opposition.
The VCAT Act has two more requirements, besides the strong legitimate claim (ensured by a substantial amount awarded) requirement, that can also ensure that your costs will be handed over to the builder. These other two situations are:
- The vexatious conduct of the proceeding or lack of proper conduct by your opposition, and
- The opposition has unreasonably prolonged the proceedings
So you can see that VCAT to a certain extent has its hands tied… and has to be as tough as nails.
And then there are the Supreme Court / High Court precedents which must be complied with… and one of these… Bellgrove v Eldridge leaves many a home owner flabbergasted… because it basically means that you cannot necessarily gain full recompense for really expensive-to-rectify defects that aim to reinstate work to how it should have been built… if these costs are considered unreasonable when compared to the detriment caused by their not being rectified… especially aesthetic items it seems. VCAT must instead come up with an amount of compensation in its place… a much cheaper amount being highly likely.
To give you an example, where the claimed defect is ‘Wet area wall tile junction joints have tiles incorrectly tight together instead of being a minimum of 3mm apart as required… and wall plasterboard cut edges are too close or tight down onto fixtures and/or not edge treated as required by plasterboard manufacturers’…
Negator building consultants invariably come up with an amount close to $45 for the rectification cost.
Building consultants claiming the defect to be reinstated the way it should have been built (including the removal of plasterboard sheets to ensure that the bottom cut edge is sealed, would come up with an amount similar to $4 800 to rectify this defect.
Some building consultants consider that a carefully cleaned formed 4 mm joint between tiles and fixture & at corner joints (foregoing the plasterboard edge sealing requirement) would likely last a reasonable time and cost about $2200 to rectify for the average house. VCAT has several times accepted this partial job for the $2200 amount, but awarded a compensation pittance when $4800 was demanded.
We should remind you that the VCAT Act requires that your building consultant and/or your opposition (negator) building consultant come up with cheaper alternatives to rectify any expensive defect where at all possible.
I know of many instances where negators have thought up alternative rectifications for agreed defects where a proper definition of defect was instrumental in having the cheaper recommendation removed from the ‘table’. Nearly every negator’s scope of works for agreed defect items has been cheapened by suggesting a band-aid solution as the rectification.
All such nonsense will be thrown out if your building consultant has a thorough definition of defect, because each repair must last a reasonable lifetime.
Bringing a reasonable life expectancy and building science into the equation is a powerful way of seeing off opposition negators… and I know of several instances of this doing the job. Having your costing correct has a similar effect… that’s why I recommend your building consultant be an expert at building science and getting a builder as expert to do the pricing of the claimed defects (after agreeing on the defects and the scope); so that you have 2 experts rather than a ‘Jack of all trades, master of none’.
So until sufficient home owners take on the system, (with resolve bolstered by a capable building consultant who keeps them informed), defects are going to continue to remain in homes until they fail and create considerable havoc when the forces they are not capable of withstanding take effect… problems such as latent heave, reduction of past partial or full heave, effects of tree roots not allowed for, very strong winds, repeated strong winds, roof truss creep, time in the elements, and more.
I advise that you go only to VCAT when you have a substantial case… and use only a very capable building consultant with a full definition of defect and considerable building science knowledge and research skills, a capable builder to help scope and price the rectification works, plus an experienced VCAT barrister… and be prepared to win an amount a fair bit less than what is needed to rectify the defects.
Builders should also be aware that they may have been very poorly advised not to give in far earlier against a determined home owner… instead of continually bluffing for bluffing’s sake. Costs are enormous for the loser and often both sides lose when poor quality expert are employed.
The amount for smaller claims has remained at just $10 000 and has not increased for decades (and is now substantially eroded by CPI bracket creep and the costs of preparation)… and clearly shows the intent of the Victorian Government… through VCAT… to thwart consumers at every turn.