Vukasinovic and Haris Developments Pty Ltd [2026] WASAT 65
A recent State Administrative Tribunal (WASAT) reminds builders, subcontractors and tradies that their poor contract administration can lead to bad financial outcomes.
In Vukasinovic and Haris Developments Pty Ltd [2026] WASAT 65, homeowners successfully pursued claims against their builder for defective work, delays and failure to complete a residential construction project. The Tribunal ultimately preferred the written contract over the builder's claims that the parties had entered into an informal verbal "cost-plus" arrangement.
The builder argued that the signed fixed-price contract was only intended to assist the owners in obtaining finance and that the real agreement was an undocumented verbal arrangement.
The Tribunal rejected that argument, relying on the written contract and the parties' conduct. The decision highlights the risks of relying on informal agreements that are not properly documented.
The builder claimed the owners had requested changes and that rising construction costs made the original contract price unworkable.
However, no formal variation notices had been issued and there was no documentary evidence supporting the claimed entitlement to additional payment.
The case reinforces the importance of documenting variations and obtaining written approval before carrying out additional work.
The contract required the works to be completed within 260 working days.
Despite substantial delays, the builder did not issue any extension of time notices. The Tribunal found the builder had failed to establish any contractual entitlement to additional time and was therefore responsible for the delay.
The builder argued that significant increases in labour and material costs made it impossible to continue the project.
The Tribunal did not accept financial hardship as an excuse for failing to perform contractual obligations or complete the works.
Numerous defects were reported, including:
Importantly, the Tribunal confirmed that even seemingly routine trade defects can result in substantial rectification costs where compliance with plans, Australian Standards and the National Construction Code is compromised.
The Tribunal determined that the relationship between the parties had broken down and that the owners had lost confidence in the builder's ability to complete or rectify the works.
As a result, compensation was considered more appropriate than giving the builder an opportunity to return and fix the defects.
This case is a reminder that builders cannot rely on informal arrangements, verbal understandings or goodwill when projects encounter difficulties.
Strict compliance with contractual requirements, including variation procedures and extension of time provisions, remains essential. Equally important is maintaining progress, complying with plans and engineering requirements, and addressing defects before they escalate into major disputes.
The Tribunal's message is clear: poor documentation, delays, non-compliant work and project abandonment can expose builders to liability well beyond the original contract value.
Good record keeping, timely notices and disciplined contract administration remain some of the most effective tools for managing risk in residential construction projects.
Jackson McDonald offers intensive contract administration training courses for Builders, subbies and tradies. Please get in touch if you would like to know how to upskill your team.