A couple who were renovating their Sydney home have lost their appeal in the NSW Supreme Court after a dispute over building work. The homeowners, Mr Hawach and Ms Reimers, claimed they had a broad contract with A & A Building Services Pty Ltd for a range of works. However, the court found the builder was only responsible for some limited waterproofing, which was defective. The builder had helped the owner-builders by recommending tradespeople and letting them use their trade account for materials. The court decided the homeowners still owed the builder money for these arrangements, which cancelled out the money the builder owed for the faulty waterproofing. The homeowners’ attempt to appeal this decision was refused because they couldn’t show the previous tribunal had made a significant legal mistake.
Detailed summary of the case
- Case Name: Hawach v A & A Building Services Pty Ltd.
- Case Number: NSWSC 1174.
- Court: Supreme Court of New South Wales.
- Judge: Stern J.
- Hearing Date: 25 September 2025.
- Decision Date: 8 October 2025.
- Place: Lindfield, NSW.
- People Involved:
- Plaintiffs (Homeowners): Joseph Hawach and Sarah Grace Reimers. Ms Reimers was the registered owner of the property and held an owner-builder permit. Mr Hawach organised the work.
- Defendant (Building Company): A & A Building Services Pty Ltd.
- Director of Defendant Company: Mr Eassey.
- Institutions Involved:
- NSW Civil and Administrative Tribunal (NCAT): The original case was heard here.
- NCAT Appeal Panel: The first appeal was heard here.
- Supreme Court of New South Wales: The final appeal was heard here.
Simple summary of the case
The story starts with a couple, Mr Hawach and Ms Reimers, who decided to renovate their home in Lindfield. Ms Reimers got an owner-builder permit, which meant she was legally responsible for the building works, while Mr Hawach organised everything on her behalf. They got in touch with a builder, Mr Eassey from A & A Building Services, who they later claimed they hired to do a whole range of building work. The homeowners argued that this builder was responsible for a lot of defective work at their property.
However, the builder told a different story. He said he never had a big contract to do all the work. Instead, he claimed he just helped them out. This help involved recommending different subcontractors to them and allowing them to use his company’s trade account to buy materials, which got them better discounts. The only specific job the builder’s company did was some waterproofing on a balcony and in the bathrooms, which was done by one of his employees.
The case first went to the NSW Civil and Administrative Tribunal (NCAT). The Tribunal looked at all the evidence and mostly sided with the builder. It found that there was no big, overarching contract for all the building works. The only formal contract was for the specific waterproofing job. The Tribunal agreed this waterproofing work was faulty and said the builder owed the homeowners $25,595.76 for the defects. But there was a twist. The builder claimed the homeowners still owed him money for the materials and services he’d arranged for them. The Tribunal agreed and found the homeowners owed the builder at least $30,000. This amount was ‘set off’ against the damages for the faulty waterproofing, meaning the homeowners’ claim was completely cancelled out, and they ended up with nothing.
The homeowners weren’t happy with this and appealed to the NCAT Appeal Panel. They argued that the builder shouldn’t be able to claim any money back because he didn’t have a proper written contract that complied with the Home Building Act. They also argued about a missing waterproofing certificate and claimed the Tribunal didn’t properly consider all the evidence that suggested a bigger contract existed. The Appeal Panel rejected all their arguments and refused the appeal.
As a final step, the homeowners took their case to the Supreme Court of New South Wales, asking for permission to appeal again. They had to prove that the Appeal Panel had made a mistake on a ‘question of law’. They brought up the same main arguments: that the set-off was illegal under the Home Building Act, that the builder was required to provide a waterproofing certificate, and that the court had ignored evidence. The Supreme Court judge, Justice Stern, carefully examined each point. The judge found that the money the homeowners owed the builder was not for residential building work under the Act, but for a separate arrangement of supplying materials and recommending trades. Therefore, the rules in the Home Building Act about written contracts didn’t apply to that money, and the set-off was allowed. The judge also found there wasn’t enough proof that providing a waterproofing certificate was a required part of their specific agreement, especially since the builder only did some of the work. Finally, the court concluded that the previous tribunals had correctly looked at all the evidence when deciding what the agreement between the parties actually was. Because the homeowners couldn’t show any clear legal errors, the Supreme Court refused to grant them leave to appeal and ordered them to pay the builder’s legal costs. For a more detailed legal breakdown, you can read the full judgment on the AustLII website. You can also explore more simplified case summaries like this one at Medigosa Legal Insights.
Q&A
- Is it legal to help a friend with their renovation by letting them use my trade account?
Yes, it’s legal. However, as this case shows, you must be extremely clear in writing about the nature of the arrangement to avoid it being mistaken for a formal building contract. - Is an oral agreement for building work legally binding?
It can be, but the Home Building Act requires residential building work contracts over a certain value to be in writing. Not having a written contract can make it unenforceable by the builder and can lead to disputes about what was agreed. - As an owner-builder, am I responsible for supervising all the work?
Yes. When you have an owner-builder permit, you take on the legal responsibilities of a head contractor, including supervising work, ensuring it meets standards, and managing the site. - Can a builder claim money from me if they don’t have a written contract?
Under the Home Building Act, a builder cannot enforce a contract for residential building work if it doesn’t meet legal requirements (like being in writing). However, as seen in this case, if they are claiming money for a separate arrangement (like supplying materials), they may still be able to recover that debt. - What is a ‘set-off’ in a legal case?
A set-off is when two parties in a dispute both owe each other money. A court can ‘set off’ the two debts against each other, meaning the smaller debt is subtracted from the larger one, and only the difference is paid. - Does a builder always have to provide a waterproofing certificate?
It depends on the contract. It is a standard and important document, but the obligation to provide one must be a term of the contract. This case showed that if the scope of work is unclear or incomplete, proving this obligation can be difficult. - Can I use text messages and emails to prove what was agreed in a contract?
Yes, for contracts that are not wholly in writing, courts can look at subsequent conduct, including texts, emails, and conversations, to figure out what the terms of the agreement were. - If I’m an owner-builder, can I hire a licensed builder to just help me out?
Yes, but the agreement must be crystal clear. If they are just a consultant or supplier, this needs to be documented. If they are supervising or carrying out work, you may be creating a formal building contract with all the legal requirements that come with it. - Is it a bad idea to be an owner-builder?
Not necessarily, but it comes with significant risk and responsibility. You need to have the time, knowledge, and organisational skills to manage a construction project and are legally liable for the work. - What’s the most important lesson from this case for homeowners?
Get everything in writing. A clear, written contract that outlines the exact scope of work, responsibilities, and costs is the best way to protect yourself from disputes. - What’s the key takeaway for builders?
Always use a compliant, written contract for residential building work. Also, if you are providing services outside of a standard building contract, like material supply, document that arrangement separately and clearly. - Is it hard to appeal a decision from the NCAT?
Yes, appealing to the Supreme Court from an NCAT Appeal Panel decision is very difficult. You can’t just disagree with the decision; you must prove the Appeal Panel made a specific error of law, which is a high bar to meet. - Could the homeowners have done anything differently?
They should have had a clear written contract from the start that specified exactly what work the builder was responsible for, rather than relying on a series of informal discussions and arrangements. - Does this case mean a builder can get around the Home Building Act?
No. The court made a distinction between the ‘residential building work’ (the waterproofing), which is covered by the Act, and the separate ‘Arrangement’ to help with materials and subcontractors, which was not. The Act’s protections still applied to the building work itself. - If a builder does defective work, am I guaranteed to be compensated?
No. While you have a right to seek compensation, you must prove your case. Furthermore, as shown here, if you also owe the builder money for other things, your compensation could be reduced or cancelled out entirely.