Claims for Losses by for example, Owners who engaged Builders and Others not necessarily engaged by the Owners, who were involved in carrying out the building works due to failure by the appropriate persons to comply with obligations to exercise reasonable care to avoid economic loss caused by building defects being claimed under the Design and Building Practitioners at 2020 (DBP Act – Section 37)

19/03/2026

Kapila v Monument Building Group Pty Limited [2025] NSWSC 1306.

We refer to our Article dated 24 February 2026 in which we:

1. Set out brief facts of the Kapila case;
2. Set out the issues that were required to be considered by the Supreme Court of New South Wales to determine the issues that arose; and
3. Considered the Court’s findings in relation to Section 37 of the DPB Act 2020 which imposes a duty of care on various persons and others who carry out construction works. The Court made an award against Mr Brujic, who was the Nominated Supervisor under MBG’s Contractor’s Licence and in that role, he supervised and made decisions as to the manner of carrying out work and was able to control the building works undertaken which resulted in various issues.  The Court held that there was a failure by MBG who was the Builder, to undertake the work with due care and skill and further Mr Brujic supervised the work and was responsible for the manner in which for example the roof, skylight and box gutter was installed and found the manner in which the work was done by him was in breach of Section 37(1) of the DBP Act.

In consideration of the matter Justice Richmond also considered:

(3)      Whether Mr Brujic can rely on Part 4 for the Civil Liability Act 2002 (NSW) (the CLA) to claim against numerous persons appointed by the Owners including the Certifying Authority (PCA), the Engineer who prepared the engineering drawing and the Architect each of whom the Defendants claimed, were concurrent wrongdoers, and should be held to account for a share of the losses; and

(4)      Whether in relation to the claim against Mr Brujic for breach of Section 37(1) of the DBP Act the defence by Mr Brujic of contributory negligence, was made out.

Part 4 of the CLA applies to apportionable claims which include a claim for economic loss or damage to property in an action for damages whether in Contract, Tort or otherwise arising from a failure to take reasonable care.

Excluded from Part 4 of the CLA are claims for a breach of statutory warranty under the Home Building Act and brought by a person having the benefit of the statutory warranty.

We refer to our Article dated 4 December 2025 relating to the Decision of the High Court of Australia, Pafburn Pty Limited v Owners Strata Plan 84674 in 2024, Pafburn had subcontracted, delegated or otherwise entrusted construction work to others.  However, Section 39 of the DBA Act disentitles a person who owes a duty of care under Section 37 when carrying out construction work, from delegating that duty. The Supreme Court in Kapila’s case reviewed various cases including Pafburn in the High Court and the decisions by the New South Wales Supreme Court Appeal Court which found that a claim for breach of Section 37(1) of the DBP Act was not apportionable. His Honour noted that Adamson JA, one of the Judges in the Pafburn Court of Appeal does not leave a person subject to a claim under Section 37 of the DBP Act without a remedy as that person can bring a cross claim against concurrent wrongdoers.  His Honour noted that in Kapila’s case no cross claim was brought.

Firstly Takeaway

Kapila has raised issues such as to Mr Brujic’s responsibility and Mr Brujic was found not to have an apportionable claim under Part 4 of the CLA.

Secondly, there is the question as to the extent of the obligations and relevant factors, which will determine the liability of a Defendant such as a Builder or other person carrying out works and the relationship between Sections 36 and 37 of the DBP Act 2020.

These two matters may be subject to further litigation in the Supreme Court of New South Wales and possibly the High Court of Australia to obtain clarification of the “factual matters” that give rise to possible claims as to who may be subject to a claim under Section 37 of the DPB Act.

Further Takeaway

Firstly persons involved in building and construction related matters, should understand their and other’s obligations under the DBP Act 2020.  Secondly, all parties or possible parties to a claim should consider alternatives available to them and others in the litigation including prospects of success and likelihood of recovery.  Further the parties also need to always consider what is the appropriate jurisdiction (Court or Tribunal in which to bring a claim), and what are the limitations of various Tribunals and Courts and limitation periods that may apply in relation to various claims.

If you are involved in a possible building dispute in relation to the issues that could arise, Watson & Watson our Lawyers have extensive experience in all areas of building and construction law. Richard Watson has been since 1995 an Accredited Specialist by the Law Society of New South Wales in Commercial Litigation in the stream of building and construction.  It is important to seek timely advice.  Do not delay, contact our experienced Building and Construction Lawyers at Watson & Watson by contacting Richard Watson or his Personal Assistant, Shereen Da Gloria to discuss your very important matter.

It is critical that you consider the factual matters and the law that applies to your circumstances and what alternatives are available. The above is not to be taken as legal advice to be relied upon, without first contacting Richard Watson as referred to above.

This is only a preliminary view and is not to be taken as legal advice without first contacting Watson & Watson Lawyers on 9221 6011.