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Introduction

In its 11 September 2025 decision, Concrete Construction Systems Pty Ltd v Inglese [2025] VSCA 218, the Victorian Court of Appeal clarified the scope of section 78 of the Victorian Civil and Administrative Tribunal Act 1998 (VCAT Act). [fn 1]

The writer acted for the successful respondents, the Ingleses, who were defending proceedings brought by the builder, Concrete Construction Systems Pty Ltd (Concrete), following practical completion of a 66-unit residential development in Ringwood.

After years of procedural delay by the Builder, the Ingleses applied under section 78 of the VCAT Act for the proceeding to be determined summarily in their favour. 

Their application succeeded before VCAT, and after the Ingleses successfully defended an appeal from the Builder in the Supreme Court (Trial Division), the Court of Appeal later upheld that outcome. 

The Court confirmed that VCAT’s power under section 78 extends to determining an entire proceeding, including both claim and counterclaim, where a party’s conduct has unnecessarily disadvantaged the other.

Key Fact Summary

• April 2015: Domestic building contract executed between the Ingleses and the Builder (“Concrete”) for construction of 66 residential units in Ringwood.
• October 2016: Practical completion achieved; but disputes arose regarding performance. Concrete claimed payment for variations; the Ingleses counterclaimed for delay damages and rectification. Each side’s claim amounted to about $2.2 million.
• November 2017: Concrete commenced VCAT proceedings; following this a defence and counterclaim was filed by the Owners in April 2018.
• September 2020: 25-day hearing listed; but Concrete repeatedly failed to comply with timetabled directions following this. By March 2021 its solicitors had ceased acting.
• Section 78 application: Ongoing non-compliance prompted the Ingleses to seek summary determination in their favour. Concrete did not appear at the hearing.
• August 2021: VCAT determined the proceeding in favour of the Ingleses as to liability.  A quantum hearing followed in September 2021; Concrete again failed to appear, and its adjournment request was refused.
• October 2021: VCAT ordered Concrete to pay the Ingleses $1.4 million plus costs.
• Re-opening application: Concrete applied under s 120; this application was dismissed for want of reasonable excuse and delay following a hearing on 2 February 2023.
• Supreme Court (Trial Division): Leave to appeal refused (20 May 2024) — it was held by Justice Harris that s 78(2)(b)(i) empowers VCAT to determine the entire proceeding.
• Court of Appeal: Further leave refused; all grounds dismissed; trial reasoning affirmed, following a Decision dated 11 September 2025.

Section 78 of the VCAT Act

“(1) This section applies if the Tribunal believes that a party to a proceeding is conducting the proceeding in a way that unnecessarily disadvantages another party to the proceeding by conduct…

(2) If this section applies, the Tribunal may—

(b if the party causing the disadvantage is not the applicant—

(i) determine the proceeding in favour of the applicant and make any appropriate orders …[fn 2]

The Core Issue

Whether VCAT’s power under s 78(2)(b)(i) to “determine the proceeding in favour of the applicant” extends to the entire proceeding(both claim and counterclaim) or only to the portion brought by the party not in default.

Application of “Unnecessary Disadvantage”

The Court anchored its analysis in the purpose of section 78 — to empower VCAT to respond where one party’s conduct “disadvantages another party to the proceeding.”

Concrete’s repeated failures to comply with directions, failure to respond to the Owners’ lawyers, its non-appearance at the hearing, and prolonged inaction were found to have unnecessarily disadvantaged the Ingleses by impeding resolution and causing procedural prejudice.

The Court of Appeal affirmed the Trial Division’s conclusion that section 78(2)(b)(i) empowers VCAT to determine the entire proceeding in favour of the applicant where the other party’s conduct has caused unnecessary disadvantage, describing the Judge’s reasoning as “compelling and clearly correct” [fn 3]. 

The Court of Appeal adopted a broad construction that is consistent with the VCAT Act’s statutory purpose:

“s 78 provides the Tribunal with powers designed to further the overall purpose of the VCAT Act, in circumstances where a party is conducting a proceeding in a way that disadvantages another party to the proceeding. We consider that the purpose of that section is to provide the Tribunal with the ability to make such orders as it considers are appropriate in response to the disadvantageous conduct of a party…” [fn 4]

Ratio and Reasoning

To reiterate, the Court affirmed that s 78(2)(b)(i) empowers VCAT to determine the whole proceeding, describing the Trial Judge’s reasoning as “compelling and clearly correct.” [fn 5]

The Court’s reasoning rested on a purposive and contextual approach to statutory construction:

“The construction of s 78(2) of the VCAT Act must begin with the text of the provision, having regard to its context and purpose. If the words of the provision have more than one possible meaning, a meaning that promotes the purpose or object underlying the statute is to be preferred over one that does not” [fn 6]

Further, they said:

“The wide range of circumstances in which the powers in s 78(2) fall to be applied supports a broad and flexible reading rather than one that is narrow and technical … A narrow, technical interpretation of s 78(2) would potentially limit the Tribunal’s powers and thus frustrate the purpose of the section. In contrast, the broader, more flexible construction advanced by the Ingleses is more likely to achieve the purpose of the VCAT Act and of s 7.” [fn 7]

Key Take-Outs

• Broad, purposive power under section 78
  • VCAT’s power to “determine the proceeding in favour of the applicant” extends to both the claim and the counterclaim, consistent with its legislative purpose.
  • The argument for the Ingleses that the claim and the counterclaim were inextricably linked, supporting a conclusion that the VCAT had intended to determine the entire proceeding when it made the s78 Order, was found to be compelling by the Court.
  • The argument for the Builder that the s78 Order when made only served to determine part of the proceeding, being the Inglese counterclaim, was rejected by the Court.

• Strict limits under section 120
  • Applications to reopen a decision under s120 of the VCAT Act must be made within 14 days and require a reasonable excuse. Concrete’s 108-day delay was “considerably outside the 14-day time limit” and therefore fatal. [fn 8]

• Procedural discipline reinforced
  • Persistent non-compliance and delay justify summary determination.  Parties who fail to engage risk having their entire case determined against them.

Conclusion

The decision in Concrete Construction v Inglese clarifies that VCAT may finally determine both claim and counterclaim under s 78(2) where a party’s conduct causes unnecessary disadvantage. It reaffirms the Tribunal’s mandate for discipline, efficiency, and fairness in building disputes.

Author Biography

Justin Cotton is Principal of Lovegrove & Cotton Construction & Planning Lawyers. He has over 23 years’ experience in construction law and building regulation, appearing frequently before VCAT and superior courts in domestic and commercial building disputes. Justin is widely published in construction law journals and has served as advisor to industry bodies on statutory compliance and law reform.

Research assistance: Gabriella Ferrara, Paralegal, Lovegrove & Cotton Construction & Planning Lawyers.

Disclaimer

This article is for general information only and does not constitute legal advice. Readers should obtain independent legal advice before acting on any information contained herein. The views expressed are those of the author and do not necessarily reflect those of Lovegrove & Cotton or its clients.

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Footnotes

[fn 1] Concrete Construction Systems Pty Ltd v Inglese [2025] VSCA 218 (11 September 2025).
[fn 2] Victorian Civil and Administrative Tribunal Act 1998 (Vic) s 78(1)–(2)(b)(i).
[fn 3] Concrete Construction Systems Pty Ltd v Inglese [2025] VSCA 218 [78].
[fn 4] Ibid [115].
[fn 5] Ibid [78].
[fn 6] Ibid [95].
[fn 7] Ibid [114] – [115].

[fn 8] Ibid [29].