The Owners – Strata Plan No. 91684 v Parkview Constructions Pty Ltd

1. [1]

   These proceedings are listed for hearing before Nixon J for three weeks commencing 2 June 2025.

2. [2]

   The plaintiff (the “Owners Corporation”) is the owners corporation of a strata development at Olympic Park. The Owners Corporation brings these proceedings against the developer, Sydney Olympic Park Authority, and the builder, Parkview Constructions Pty Ltd (“Parkview”).

3. [3]

   One claim by the Owners Corporation relates to allegedly combustible aluminium composite cladding on the building (the “Cladding”).

4. [4]

   In relation to the Cladding, Parkview has brought a cross claim against a fire engineer, WSP Buildings Pty Ltd (“WSP”), an architect, Bates & Smart Pty Ltd (“Bates Smart”), and a certifier, McKenzie Group Consulting (NSW) Pty Ltd (“McKenzie”).

5. [5]

   I am dealing with Parkview’s application, made by Notice of Motion filed on 17 April 2025, to amend its Cross Claim List Statement (“Cross Claim”) against these parties.

6. [6]

   Parkview has circulated six iterations of its proposed Cross Claim. I am dealing with the sixth and final iteration.

7. [7]

   WSP and Bates Smart oppose the proposed amendments

8. [8]

   The controversial aspects of the amendments go to the question of causation

9. [9]

   Parkview alleges that each of WSP and Bates Smart acted in breach of their posited contractual and general law duties in relation to the Cladding and that, but for those breaches, Parkview would not be exposed to the Owners Corporation’s claim.

10. [10]

    When a party alleges that but for the impugned conduct of a party a particular circumstance would or would not have come about, it is important for the pleading to “identify the likely credible sequence of events which would have occurred” but for the impugned conduct that would have led to that result. [1]

11. [11]

    Parkview’s existing Cross Claim baldly asserts that “as a result” of the alleged breaches of contract and duty by WSP and Bates Smart, Parkview will suffer loss, being any damages payable to the Owners Corporation. [2]

12. [12]

    WSP and Bates Smart have made no complaint about those allegations and have not sought particulars of them.

13. [13]

    Parkview contends that the amendments seek to align its claim concerning the Cladding with expert evidence it has already served on WSP and Bates Smart, and had been responded to through expert evidence adduced by those parties.

14. [14]

    That may be so, but it remains necessary that the pleading have the characteristics that I have set out at [10] above.

The claim against WSP

1. [15]

   The proposed amended pleading against WSP is:

2. [16]

   As can be seen, in proposed [C22A(b)] Parkview asserts that, but for WSP issuing a letter of 25 August 2015 stating its opinion that the Cladding was compliant, McKenzie, as the certifier, would not have issued the relevant Occupation Certificates.

3. [17]

   Insofar as the particulars to [C22A(b)] set out the “likely sequence of credible events” said to lead to that conclusion, they amount to no more than an assertion that, as a matter of fact, the Occupation Certificates were issued after the 25 August 2015 letter.

4. [18]

   Parkview’s case is that it is to be inferred that, absent the 25 August 2015 letter, McKenzie would not have issued the Occupation Certificates.

5. [19]

   In proposed [C22A(c)] Parkview then asserts that, but for McKenzie issuing the Occupation Certificates, Parkview would not have been exposed to the Owners Corporation’s claim because “the” strata plan would not have been registered, and the Owners Corporation could not have brought “this” claim against it.

6. [20]

   In argument, Mr Ashhurst SC, who appeared with Mr Corbett for Parkview, explained that Parkview’s case was that it followed from an assumption that McKenzie did not issue the Occupation Certificates that no strata plan would have issued in relation to a building with the allegedly combustible Cladding; and that it followed that Parkview would not be exposed to the Owners Corporation’s claim concerning such Cladding.

7. [21]

   Mr Ashhurst did not suggest that these matters followed because, absent the Occupation Certificates, building work would have proceeded no further: a proposition which, if made, would have deserted reality bearing in mind the liquidated damages provision in the relevant building contract.

8. [22]

   Rather, buried within Mr Ashhurst’s submission is the concomitant contention that, somehow, the building would have been completed with compliant Cladding.

9. [23]

   But the proposed pleading does not explain how this would be so. It does not set out the likely credible sequence of events that would have led to this result.

10. [24]

    An earlier iteration of the proposed amended Cross Claim did go some way in providing such an explanation. It asserted:

11. [25]

    As I set out below, [3] Parkview seeks to make a similar allegation in its proposed amended Cross Claim against Bates Smart, albeit one not referring to any steps to be taken by Parkview.

12. [26]

    However, by the proposed pleading against WSP, Parkview purports to eschew the task of proving the counterfactual circumstance that would have existed absent McKenzie issuing the Occupation Certificates. In particular, the proposed pleading leaves unstated the critical integer of what Parkview itself, as the builder, would have done to deal with that circumstance.

13. [27]

    Were that pleading to be allowed it would, in substance, throw upon WSP the onus of seeking to prove the counterfactual posited in the iteration of Parkview’s proposed Cross Claim set out at [24] above. That would not only be unfair but also, on the evidence before me, cannot be achieved in time for the hearing.

14. [28]

    For those reasons, I decline to grant Parkview leave to amend its Cross Claim as sought.

15. [29]

    It is true, as Mr Ashhurst emphasised, that this will leave the pleading of Parkview’s causation case as I have set out at [11] above. Mr Ashhurst stated that, at the very least, proposed [C22A] should be seen as representing the giving of particulars by Parkview of how it now proposes to prove its case on causation. It will be a matter for the trial judge to assess whether that is sufficient.

The claim against Bates Smart

1. [30]

   As against Bates Smart, Parkview seeks to add to its allegations of breach of contract and duty an allegation that Bates Smart failed to make “sufficient inquiry” concerning the Cladding. [4]

2. [31]

   Mr Sheldon, who appeared for Bates Smart, stated that Bates Smart may be able to deal with that further allegation provided it is adequately particularised prior to the commencement of the trial. Accordingly, I will leave to the trial judge the question whether Parkview should have leave to amend its Cross Claim to this effect.

3. [32]

   As to causation, Parkview seeks to add [C32A] as follows:

4. [33]

   Mr Ashhurst said that proposed [C32A(a)] and [C32A(b)] are intended to allege that if Bates Smart had made “sufficient inquiry” about the Cladding that the façade subcontractor, Jangho Curtain Wall Australia Pty Ltd, [5] proposed to use, then it would have required Jangho to submit the Cladding for the tests specified in Bates Smart’s specifications, and those tests would have revealed that the Cladding was combustible.

5. [34]

   The difficulty is with proposed [C32A(c)].

6. [35]

   Unlike its proposed Cross Claim against WSP, Parkview seeks here to explain why, but for Bates Smart’s alleged failure, it would not be exposed to the Owners Corporation’s claim; namely that an alternative non-combustible cladding “would have been approved for use on the façade”.

7. [36]

   But the proposed pleading does not reveal how this result would have come about. It does not set out the likely credible sequence of events that would have led to this result. In particular, once again, the critical integer of what Parkview would have done is absent.

8. [37]

   For that reason, I decline to grant Parkview leave to amend its Cross Claim to this effect.

9. [38]

   The matters I have set out at [29] are also applicable in relation to Bates Smart.

Conclusion

1. [39]

   Prayers 2, 3, 6 and 7 of Parkview’s Notice of Motion of 17 April 2025 as against WSP and Bates Smart must be dismissed with costs.

2. [40]

   I understand that McKenzie does not oppose the amendments Parkview proposes in relation to the Cross Claim against McKenzie. Parkview and McKenzie should bring in agreed Short Minutes as to the orders they propose be made.

3. [41]

   I invite the parties to bring in agreed Short Minutes as to the remaining relief sought by Parkview in its Notice of Motion. In the meantime, I will stand the remainder of the motion over to the motions callover on 23 May 2025.