Case Note: Grech V Dakota Homes Pty Ltd (Building And Property) [2025] VCAT 944

Jurisdiction: Victorian Civil and Administrative Tribunal (VCAT), Building and Property List
Members: R Bennett & C Bennett
Hearing Date: 21 July 2025
Decision Date: 23 October 2025

Representation

Applicants: Kevin Grech and Jennifer Grech (Grech's) (represented by Mr J Gray of Just Law, solicitor)

Respondent: Dakota Homes Pty Ltd (Builder) (represented by Mr A Germano of Counsel, instructed by PCL Lawyers)

Factual Background

The Grechs entered into a domestic building contract with the Builder for the construction of a new single-storey dwelling in Wallan, Victoria. The contract was executed on 17 March 2018, with works completed in June 2019. The Grechs alleged defective building work, particularly in relation to the footings and roof, and sought substantial damages, including the cost of rebuilding or rectification. The Builder counterclaimed for the outstanding contract balance ($12,924.30).

Issues for Determination

The Tribunal, by agreement of the parties, was to identify and make findings as to the following issues ([4], [8]):

1. Whether there were defects in the footings of the dwelling ("footings defects").
2. If so, whether such defects required rectification, and if so, the appropriate method and cost of rectification.
3. Whether there was a defect in the roof ("roof defect").
4. If so, whether such defect required rectification, and if so, the appropriate method and cost of rectification.

Basis of Grech's Claim

The Grechs' claim was brought under section 8 of the Domestic Building Contracts Act 1995 (Vic) ("DBCA"), alleging breach of the statutory warranties, including that the works would be:

• Carried out in a proper and workmanlike manner and in accordance with the contract (s 8(a));
• Using suitable and new materials (s 8(b));
• In compliance with all legal requirements (s 8(c));
• With reasonable care and skill (s 8(d));
• Resulting in a home suitable for occupation at completion (s 8(e)) ([15]-[16]).

The Grechs bore the onus of proof on the balance of probabilities ([17]). The Tribunal applied established principles regarding damages for breach of contract, including the "ruling principle" that damages should place the claimant in the position they would have been in had the contract been properly performed. ¹

Expert Evidence

Both parties relied on several findings from each of their appointed experts:

• Grechs: Mr Alex Rodriguez (Structural and Geotechnical Engineer)
• Builder: Mr Hugh O'Brien (Structural Engineer and Building Consultant)

The Tribunal also considered lay evidence from the Grechs and the Builder's director ([5]-[6]).

Tribunal's Findings

1. Footings Defects

The Grechs alleged multiple deficiencies across several amended pleadings, including omitted bored piers, incorrect pier diameters, inadequate founding depths, uncleaned pier holes, inadequate edge beams, and issues with internal footing beams ([27]-[33]).

• Expert Evidence:

• The Tribunal found that, while there may have been a missing bored pier at the southwest corner, there was no evidence of consequential movement or damage ([38]-[43], [76]).
• Minor movement and deflection in the slab were within the tolerances prescribed by AS2870-2011 Residential slabs and footings and the Guide to Standards and Tolerances ([61]-[66]).
• The Tribunal preferred the evidence of Mr O'Brien, who opined that any movement was minor, within tolerances, and not indicative of defective work ([50], [58], [72]).
  • The Tribunal accepted that any localised narrowing of internal beams was not intentional and did not compromise structural performance ([54]-[58]).
  • Conclusion:
    The Grechs failed to establish, on the balance of probabilities, that the Builder breached the statutory warranties in relation to the footings. No actionable defect was found ([74]).

2. Roof Defect

The Grechs contended that the roof trusses were inadequately supported due to the absence of bored piers under an internal wall ([78]-[79]).

• Expert Evidence:

• The Tribunal accepted Mr O'Brien's evidence that the design did not require bored piers under the internal wall and that the slab's performance under load was within allowable limits ([81]).
• Mr Rodriguez's contrary opinion was not supported by load analysis or reference to relevant standards ([82]).
  • Conclusion:
    No defect was established in relation to the roof. The Tribunal found that the construction was consistent with the approved design and relevant standards ([83]).

3. Rectification and Damages

As no breach of statutory warranty was established, the Tribunal found no basis for rectification or damages. The Grechs failed to prove any loss or damage arising from the alleged defects ([75], [77], [84]-[85]).

4. Counterclaim

The Grechs did not contest the Builder's counterclaim for the outstanding contract balance. The Tribunal ordered payment of $12,924.30 to the Builder ([88]).

Orders

1. The Grechs' claim was dismissed in its entirety ([86]).
2. The Grechs were ordered to pay the Builder its Counterclaim in full of $12,924.30 ([88]).
3. Leave was granted for either party to apply for costs.

Significance and Commentary

This decision reinforces the high evidentiary threshold required to establish defective building work under the DBCA. The Tribunal's approach underscores:

• The necessity for claimants to adduce cogent expert evidence demonstrating both breach and causation of loss.
• The Tribunal's reliance on statutory standards and tolerances as the benchmark for assessing alleged defects (AS2870-2011; Guide to Standards and Tolerances).
• The importance of distinguishing between minor, localised issues and defects that materially affect the performance or value of the building.
• The Tribunal's willingness to accept performance solutions where minor departures from "deemed to satisfy" provisions do not result in actual or potential harm ([57]).

The case also illustrates the Tribunal's pragmatic approach to damages, declining to award rectification costs where the evidence does not support the existence of actionable defects or loss, in line with Bellgrove v Eldridge (1954) 90 CLR 613 and Tabcorp Holdings Ltd v Bowen Investments Pty Ltd [2009] HCA 8.

Legislation, References & Regulations

• Grech v Dakota Homes Pty Ltd (Building and Property) [2025] VCAT 944
• Domestic Building Contracts Act 1995 (Vic)
• AS2870-2011 Residential slabs and footings
• Guide to Standards and Tolerances
• Lu v Metricon Homes Pty Ltd (Building and Property) [2021] VCAT 1359
• Robinson v Harman (1848) 1 Exch 850, 154 ER 363
• Tabcorp Holdings Ltd v Bowen Investments Pty Ltd [2009] HCA 8; (2009) 236 CLR 272
• Bellgrove v Eldridge (1954) 90 CLR 613
• Clarendon Homes Vic Pty Ltd v Zalega (Domestic Building) [2010] VCAT 1202
• Ruxley Electronics and Construction Ltd v Forsyth [1996] AC 344

Footnotes

¹ Lu v Metricon Homes Pty Ltd (Building and Property) [2021] VCAT 1359, [33], citing Robinson v Harman (1848) 1 Exch 850, 154 ER 363, 365, cited with approval in Tabcorp Holdings Ltd v Bowen Investments Pty Ltd [2009] HCA 8; (2009) 236 CLR 272, [13] ([22]).

Bellgrove v Eldridge (1954) 90 CLR 613, 617–18 ([23]); Clarendon Homes Vic Pty Ltd v Zalega (Domestic Building) d, [159] ([25]-[26]); Ruxley Electronics and Construction Ltd v Forsyth [1996] AC 344 ([25]).

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