The Strata Gavel: The Lacrosse Cladding Fire Appeal Decided [mostly]
Quick news on important strata cases …
Last Friday the Victorian Court of Appeal considered the issues in the appeal about VCAT’s decision over who was liable for the fire and damage caused at the Lacrosse building on 24/25 November 2014 due to combustible cladding.
To recap, VCAT decided that the builder and others involved in the design and construction of the Lacrosse building were responsible for the fire and damage and split that liability between them.
The decision was appealed to the Victorian Court of Appeal and the first step in the appeal is to decide whether the appeal grounds have prospects and should proceed. If they do have prospects, then the appeal proceedings to a hearing. If not, the appeal is over.
In VCAT the builder was found liable to the strata building for breaching statutory warranties and the architects, building surveyors, fire engineers, and the apartment smoker [who’s cigarette but started the fire] partially liable splitting liability between them as follows:
30% to The Builder, LU Simon.
33% to the Building Surveyor, Gardner Group.
5% to the Architect, Elenberg Fraser.
39% to the Fire Engineer, Thomas Nicolas.
3% to the smoker, Mr Gubitta [although because he didn’t participate in the hearing no judgment was entered against him].
The liable parties appealed on 25 grounds covering 11 issues which I’ve listed in the Key Facts section at the end of this article.
The Victorian Court of Appeal upheld most of the VCAT decision and refused leave to appeal [effectively dismissing the appeals] on 24 of the 25 grounds; only allowing the appeal to proceed on whether the building surveyor was liable or more liable for failing to identify and fix the non-compliance with the cladding in the #### fifth FER.
So, that issue remains to be decided in the appeal.
But, most of the Lacrosse case is now over with a Victorian Court of Appeal decision in favour of the strata building and against the builder, architects, building surveyors, and the fire engineers mostly intact.
It’s good news for the Lacrosse building and its owners. And, it’s good news for other strata buildings with flammable cladding and active or potential claims.
I’ll be writing a more detailed article about the Lacrosse case and the principles behind it soon as part of a bigger series on cladding issues for strata buildings.
So, watch this space.
March 29, 2021
Francesco …
KEY DETAILS OF THE CASE
Case Name: Tanah Merah Vic Pty Ltd v Owners' Corporation No 1 of PS631436T [2021] VSCA
Judgement: https://www.lawlibrary.vic.gov.au/library-services/digital-library/judgments/tanah-merah-vic-pty-ltd-v-owners-corporation-no-1
The Parties:
The builder, LU Simon Pty Ltd
The building surveyor, Stasi Galanos and employer, Gardner Group Pty Ltd
The architect, Elenberg Fraser Pty Ltd
The fire engineer, Tanah Merah Pty Ltd, trading as Thomas Nicolas
The apartment 805 resident, Gyeyoung Kim
The apartment 805 smoker, Mr Gubitta
The superintendent under the building contract, Property Development Solutions (Vic) Pty Ltd
The 11 Issues for Appeal:
1. Were the Owners’ claims against the respondent’s apportionable claims under pt IVAA of the Wrongs Act 1958?
2. Was LU Simon a concurrent wrongdoer in respect of the consultants for the purposes of s 24AH of the Wrongs Act?
3. Did LU Simon fail to take reasonable care?
4. On the proper construction of the T2 Specification and Elenberg Fraser’s drawings, was LU Simon directed and/or permitted to select the product Alucobest or any composite metal cladding product that was contrary to the Building Act 1993 and the Building Code of Australia?
5. Did the Tribunal err in finding that Elenberg Fraser was negligent in respect of its inspection and approval of the Alucobest sample?
6. Was it reasonably open to the Tribunal to find that the Owners’ loss included an increase in insurance premiums?
7. Did the Tribunal err in its construction of cl C1.12(f) of the BCA?
8. Did the Tribunal err in its conclusion that the ‘peer professional opinion’ was ‘unreasonable’ for the purposes of s 59(2) of the Wrongs Act?
9. By issuing the Stage 7 Building Permit7 did Gardner Group make a representation to LU Simon that was misleading and deceptive?
10. Was Gardner Group’s failure to identify and remedy the omission in the Fifth FER causative of any loss?
11. Did the Tribunal fail to consider the degree of departure by Gardner Group from the relevant standard of care in making [its] apportionment findings?