Developer agrees to purchase Home with defective structure from Owner


Dudley purchased a home from a major developer in a new subdivision. The owners and their family lived in the new house for a few years.  Issues arose as to the quality of the building work. 

Richard Watson received instructions to act on behalf of the home owner who had previously engaged solicitors to act on his behalf to seek redress from the developer. 

The prior solicitor engaged building consultants who formed an opinion that there were serious structural issues in the house construction.

The developer engaged building consultants including a structural engineer who disputed home owner’s the claims and those of the consultants on behalf of the owner. 

In this case as often happens:

(a)       The building consultants including the structural engineer engaged on behalf of the owner formed the opinion that there were very serious structural issues.

(b)       The building consultants including the structural engineer engaged on behalf of the developer inspected the property and prepared reports indicating that whatever the defects were; they could be overcome simply and without a huge expense.

The former solicitor commenced proceedings in the District Court of New South Wales against the developer.

The developer offered to settle the homeowner’s claim by paying the home owner $45,000 plus costs.  This was rejected by the Homeowner. 

The owner sought settlement of a significant payment which would be sufficient to cover the cost of demolition of the existing house and rebuilding the house.  This was rejected by the developer.

The home owner thereafter instructed Richard Watson of Watson & Watson in relation to the matter. 

At the time Richard Watson was instructed the matter had a hearing date in the District Court of New South Wales shortly thereafter.  

Richard Watson reviewed the status of the evidence and the proceedings and formed the view that amendments were required to be made to the claim and that it was appropriate to transfer the proceedings from the District Court of New South Wales to the Supreme Court of New South Wales.

The proceedings involved construction law, the home building act and other related matters including the breach of statutory warranties by the developer.

The case was reviewed and transferred to the Supreme Court which resulted in the vacation of the District Court hearing date.

Significant additional evidence was obtained and the case was prepared for hearing.  Notices were served on the developer to produce for inspection the records relating to the construction issues.  Offers were made by the homeowner which were reasonable in light of the evidence on behalf of the homeowner.  Unfortunately the developer did not accept those offers and maintained it’s previous position referred to above.  Eventually the matter was listed for hearing.

Very significant costs were incurred in properly preparing the case including briefing Senior Counsel. 

Eventually the matter was settled on the first day of the hearing whereby the developer purchased the house on a valuation that was determined independently for the property on the basis that the property had no defects.  In addition the developer agreed to and paid additional costs including legal costs and consultancy costs of the owner. 

If you have a problem with your construction project or the construction of units or construction of a home or house or any other residential construction and you are faced with difficulties in obtaining appropriate resolution of your claim for breaches of a Building or Construction Contract or breach of Statutory Warranty please telephone Richard Watson of Watson & Watson, experienced Building & Construction Lawyers of Sydney who are experienced in all aspects of building and construction law within New South Wales.

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