Residential Focus: Onus Of Proof And Failure To Mitigate

In Ceerose Pty Ltd v The Owners - Strata Plan No 89074 [2025] NSWCA 235, the builder and developer appealed a decision from the Supreme Court which ordered them to pay the owners corporation $1.95 million, for the cost of rectifying defects.

The building was completed in 2014 and the proceedings commenced in 2017. In 2018 and 2019, the owners corporation informed the builder that it had lost or was losing confidence in the builder and was not prepared to allow access for further defect rectification. Mitigation was an issue bearing upon damages.

In the Court below, issues of liability and quantum were subject of an order for a reference. The referee took the view that the builder and developer bore the onus of proving that the owners corporation's denial of access was unreasonable. In the adoption hearing, the builder and developer sought a declaration that the owners corporation failed to mitigate its loss by refusing access.