VICTORIAN CIVIL AND ADMINISTRATIVE TRIBUNAL
CIVIL DIVISION
BUILDING AND PROPERTY LIST	
vcat reference No. BP534/2017	
CATCHWORDS	
REINSTATEMENT application – Terms of Settlement – works done – source of water leak – new claims or existing claims – expert reports.	

FIRST APPLICANT	Ms Virginia Dowzer	
SECOND RESPONDENT	Mr Antonio Gennaro Paterno	
THIRD RESPONDENT	Owners Corporation No1 PS 320789Q	
FOURTH RESPONDENT	Owners Corporation No2 PS 320789Q	
WHERE HELD	Melbourne	
BEFORE	H. Nash, Member	
HEARING TYPE	On the papers 	
DATE OF submissions	19 June 2020 and 21 July 2020	
DATE OF ORDER	18 November 2020	
CITATION	Dowzer v Paterno & Ors (Building and Property) [2020] VCAT 1291	

Order
For the reasons set out below

1	The proceeding is reinstated.
2	The proceeding is listed for a directions hearing on 22 December 2020 at 2.15pm to be heard together with proceeding BP960/2017.

H. Nash
Member			

APPEARANCES:		
For Applicant	Ms V Dowzer, in person	
For Second Respondent	Mr A Paterno	
For Third Respondent	Ms A Mitchell, solicitor	
For Fourth Respondent	Mr A Paterno and Mr H Goldberg	

Reasons
1	The applicant is the owner of an apartment located in St Kilda.
2	The respondents are respectively the owner of the apartment immediately above the applicant’s apartment and the Owners Corporation.
3	This application is made by the applicant seeking for the proceeding to be reinstated in accordance with the right to apply for reinstatement of the proceeding recorded in the Terms of Settlement entered into between the parties dated 21 June 2018.
Background
4	The original three storey building in St Kilda was developed in 2003 to add further storeys of apartments on top of the original building. Apartment 410 is directly above the apartment 310, which is owned by the applicant.
5	The applicant says that the water ingress began in 2010.
6	In 2017 the applicant commenced this proceeding because of water ingress into her apartment causing damage.
7	On 21 June 2018 the parties participated in a compulsory conference at the Tribunal which resulted in the proceeding being resolved and terms of settlement being entered into by all parties (the Terms of Settlement).
8	The applicant now seeks to have the proceeding reinstated on the basis that the Terms of Settlement have not been complied with by the respondents.
9	The applicant alleges that water continues to flow from the respondents’ land to the applicant’s land contrary to the Terms of Settlement.
10	In order to determine whether the proceeding should be reinstated as provided for in the Terms of Settlement, it must be determined whether the alleged continued ingress of water onto the applicant’s land is occurring as a consequence of the Terms of Settlement not being complied with or whether the source of water ingress is, as alleged by the respondents, from a new source.
Terms of Settlement
11	Therefore, consideration must be given to the relevant clauses of the Terms of Settlement. The relevant clauses in the terms of settlement are
I.	A dispute arose between the Applicant and the Respondents in relation to alleged flows of water from the Respondents’ land to the Applicant’s land (“the dispute”).
…
1.	The parties agree and consent to the following orders being made by the Tribunal:
1.1	the proceeding as between the applicant and the respondents is struck out with a right to apply for reinstatement, and
1.2	no order as to costs.
3.	By no later than 29 March 2019, unless otherwise agreed in writing between the parties, the Respondents agree to rectify each of the 6 alleged areas of water ingress identified by Mr Jason Curtis of Buildspect in his expert report dated 1 November 2017 in respect of apartment 310.
…
6.	Upon completion of the works identified in clause 3 herein, the Respondents will provide the Applicant a copy of the certificate of compliance issued in respect of waterproofing.
Scope of Terms of Settlement
12	From the above clauses the areas where the works were required to be undertaken by the respondents are those set out in the expert report of Mr J Curtis of Buildspect dated 31 October 2017 (the 2017 report).
13	The 2017 report sets out 6 areas of water ingress and what he believes to be the source of that water ingress. Those areas of water ingress are:
i	the bathroom ceiling; 
ii	the laundry ceiling;
iii	the kitchen ceiling above the cooktop;
iv	the kitchen ceiling;
v	the eastern corner; and 
vi	the ceiling on the south eastern side of the family room. 
Since 21 June 2018
14	Ms Dowzer agrees that some work has been done since 21 June 2018 but says that because there is still water ingress into the property in the areas recorded in the 2017 report. Therefore, the applicant argues that the respondents have not complied with their obligations under the Terms of Settlement.
15	The respondents say that the work was carried out in accordance with the 2017 report and that the source of the further water ingress is a new source.
16	Ms Dowzin says that while the source of the further water ingress may be a new source the water ingress remains in the same areas identified in the 2017 report and under the Terms of Settlement, the obligation on the respondents is to rectify each of the 6 areas of water ingress identified in the report. The obligation is not to rectify the source of that water ingress but rather to rectify the area to ensure there is no further water ingress.
New Expert Report
17	In order to resolve the question as to whether the current water ingress is in areas identified in the 2017 report, Mr Curtis prepared a further report dated 28 February 2020 (the 2020 report).
18	The 2020 report states that with respect to the water ingress to kitchen and bathroom ceilings, that the area remains affected by water ingress. However, as to the source of that water ingress:
i	Water ingress to bathroom ceiling. 
The 2020 report indicates that no further water ingress to this area was evident during the subsequent inspection.
ii	Water ingress to laundry ceiling. 
The 2020 report finds that water ingress resulted through the post penetration of the balcony balustrade of apartment 410 and the leaking aluminium framework to the glass screen detail has not been rectified.
iii	The chimney flashing above the laundry. 
The chimney flashing at the junction of the balcony and balcony tiling has been replaced and the light spray of water did not result in water entry in the laundry below however where the chimney glass screen intersect water has entered through that gap and down the render of the chimney resulting in immediate water ingress into the laundry ceiling. This source of water ingress is a new source that is approximately 300 mms away from the water source identified in the original in the 2017 report.
iv	Water ingress to kitchen and eastern end of family room ceiling. 
Plumbing works have been completed to the external cladding adjacent to the kitchen and no further water ingress to this area was evident.
v	Water damage to ceiling on south eastern side of family room.  
The balcony above the family room ceiling has been replaced and no further water ingress to this area was evident.
vi	Water damage to south-eastern bedroom.
Water testing to the chimney above the south-eastern bedroom ceiling resulted in heavy water ingress through the ceiling and onto the external wall. The water ingress to this area was not identified in the 2017 report and is considered to be a new leak.
19	In summary the 2020 report found as follows
Further plumbing works have been completed to the external cladding adjacent to the bathroom, kitchen and eastern end of the family room ceiling and no further water ingress could be identified in these areas. The post penetrations of the glass screen to the courtyard balcony continues to allow water ingress and subsequent water damage to the laundry below. The chimney in the laundry is now allowing water to penetrate into the laundry from above the balcony and chimney junction. The chimney in the south-eastern balcony of apartment 410 is now allowing water to enter the bedroom ceiling below.
Further new leaks have been identified on each inspection of the dwelling.
20	The conclusions reached in the 2020 report indicate that while works were done to the sources of water ingress identified in the 2017 report, in accordance with the Terms of Settlement, it appears that having undertaken those works is caused further water leaks to occur. It is as a consequence of undertaking those works that there are new sources of water leaks rather than the works not having been done in accordance with the Terms of Settlement.
21	However, the Terms of Settlement state that the 6 areas of water ingress are to be rectified, not that the works identified in the 2017 report are to be undertaken.
22	Had the parties intended the respondents’ obligation to be confined to undertaking the works as outlined in the 2017 report, the Terms of Settlement would have reflected this.
23	As a question of interpretation, the use of the words “6 alleged areas of water ingress” indicates that the rectification works were to be undertaken by reference to the location of the water ingress rather than the source identified in the 2017 report.
24	Accordingly, I find that while the works undertaken by the respondents accords with the scope of works in the 2017 report, the areas of water ingress have not been rectified as new sources of water ingress in those areas have arisen.
25	I will therefore allow the reinstatement application and will refer the proceeding to a directions hearing for orders to be made as to the further conduct of the proceeding.

H. Nash
Member