Homeowners in New South Wales are increasingly bringing claims against builders and developers for defective work. Traditionally, builders could argue that others—such as engineers, certifiers or architects—shared responsibility, reducing the amount they had to pay. The Supreme Court’s decision in Kapila v Monument Building Group Pty Ltd (November 2025) has decisively limited that approach, marking a major shift in risk for builders and stronger protection for homeowners. Julian and Renee at Flash Conveyancing see this as a significant development for property buyers and renovators.
The case involved a terrace house owned by Dr Kapila in Paddington, where defects included waterproofing issues and electrical faults. Proceedings were brought against Monument Building Group and its sole director, Mr Brujic, under both contract and section 37 of the Design and Building Practitioners Act 2020 (NSW) (DBPA).
The Court focused on personal responsibility and found the director personally liable because:
- Mr Brujic, as supervising director, exercised effective control over the construction works.
- The duty of care under the DBPA is non-delegable—engaging others does not remove liability.
A key outcome of the decision is the limitation of the builder’s “apportionment defence”. Previously, builders could involve other parties in proceedings to reduce their share of liability. Justice Richmond clarified that for section 37 claims:
- The “full liability” principle applies—a breach of duty results in responsibility for the entire loss caused.
- Blaming certifiers or architects does not reduce the homeowner’s entitlement.
- Builders may pursue separate cross-claims against third parties, but this does not delay or reduce payment to the homeowner.
The impact of Kapila v Monument Building Group in 2026 is clear:
- Who pays? The builder (and potentially the director) is responsible for the full loss upfront.
- Personal exposure: Directors who control projects may face personal liability—corporate structures offer less protection.
- No more deflection: Shifting blame to other professionals is no longer an effective defence against homeowners’ claims.
Flash Conveyancing Advice:
When purchasing a new build or undertaking renovations, carry out due diligence on the builder and the director behind the project. Kapila confirms that in NSW, those in control of construction are legally responsible for the quality of the work—giving homeowners stronger protection against defects.
Flash Conveyancing, led by Julian & Renee, are specialists in property transactions across New South Wales. With extensive experience across councils including Blacktown, Hawkesbury, Blue Mountains, The Hills, Hornsby and Parramatta, they provide a personalised and reliable approach to every settlement. Whether buying or selling across Greater Western Sydney, your transaction will be handled with clarity, care and confidence.