Federal Court of Australia

Wang v Creation Homes QLD Pty Ltd [2026] FCA 136

ORDERS

THE COURT ORDERS THAT:

1.    The originating application be dismissed.

2.    The cross respondent pay to the cross claimant the amount of $51,800 plus interest calculated at 15 percent per annum from 6 June 2018.

3.    The cross respondent pay to the cross claimant damages in the amount of $114,742.66 plus interest calculated at 15 percent per annum from 28 January 2020.

4.    The applicant/cross respondent pay the respondent/cross claimant’s costs of the application and the cross claim as agreed or assessed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

KENNETT J:

1    The applicant (Ms Wang) entered into a construction contract (the contract) with the respondent (Creation) on 2 February 2016, with a view to constructing a home in a new development in Coomera, Queensland. Construction was not completed and Creation issued a notice of termination under the contract on 28 January 2020.

2    By an originating application filed on 20 December 2024, Ms Wang seeks damages against Creation. Her pleadings are not easy to follow but it appears that she relies on claims under the Australian Consumer Law (the ACL) and in contract. Creation has cross claimed for an amount alleged to be payable pursuant to the contract and for damages in contract.

Ms Wang’s claims

3    Ms Wang’s originating application seeks the following substantive relief.

1.    Damages pursuant to section 236 of the Australian Consumer Law (Schedule 2 to the Competition and Consumer Act 2010 (Cth)) for losses incurred as a direct and foreseeable consequence of the Respondent’s conduct, including:

(a)    Forfeiture of deposit payments;

(b)    Holding costs, including interest and ancillary charges incurred due to the Respondent's delay;

(c)    Costs of demolition, remedial works, and expenses arising from the Respondent’s non-compliance with contractual and statutory obligations; and

(d)    Incidental expenses associated with the Respondent’s contraventions, such as council rates and related costs.

2.    A declaration that the Respondent engaged in conduct that was:

(a)    Misleading or deceptive, in contravention of section 18 of the ACL;

(b)    Unconscionable, in contravention of section 21 of the ACL; and

(c)    Contrary to statutory guarantees under the ACL, including the guarantees as to due care and skill.

4    The claim for declaratory relief was not separately agitated. In particular, although allegations of misleading, deceptive and unconscionable conduct featured as part of the claim for damages under s 236, the allegation that Creation had acted contrary to “statutory guarantees” was not developed. No reason was advanced as to why, if damages were awarded, the Court should make a declaration as well. The claim for declaratory relief can thus be put to one side.

5    Ms Wang’s statement of claim is not easy to follow. The paragraphs that appear to allege conduct in breach of provisions of the ACL are as follows.

3.3 Following land settlement on 28 January 2016, construction was delayed until March 2018, far exceeding any commercially reasonable period. During this delay, the Respondent failed to provide timely notification of commencement and completion of the initial construction stage to the Applicant or the bank. This failure, in effect, deprived the Applicant of the opportunity to confirm workmanship and compliance before authorising release of further funds. The Respondent’s conduct thereby risked misleading the Applicant and the bank as to the actual state of progress, contrary to section 18 of the ACL, which prohibits misleading or deceptive conduct.

(Refer to Annexure 1)

3.4 By failing to facilitate the agreed and statutorily contemplated inspections, the Respondent acted unconscionably in relation to the Applicant’s legitimate reliance on independent verification. Such conduct is proscribed by section 21 of the ACL, which prohibits unconscionable conduct in connection with the supply of services.

3.5 The Respondent bypassed critical construction stages such as foundational works and structural inspections, in breach of both the Contract and the statutory guarantees that services will be rendered with due care and skill. This conduct gave rise to false or misleading representations in respect of the nature, quality, and completion of the building services, contrary to section 29(1) of the ACL.

(Emphasis in original.)

6    The statement of claim also advances a claim of breach of contract, although contractual damages are not sought in the originating application. The contractual claim is as follows.

4. Contractual Obligations and Breach

4.1 Under the terms of the Contract and the statutory regime for consumer protection, the Respondent was obliged to commence construction diligently, adhere to stipulated timeframes, and comply with quality assurance procedures integral to the Applicant’s rights and the bank’s lending conditions.

4.2 The Respondent’s breach is manifest. It failed to timely commence works, omitted to notify relevant parties of construction milestones, and disregarded requirements for stage inspections. Such breaches subverted the fundamental intention of the Contract and the ACL’s protections against dishonest commercial practices.

4.3 As a consequence, the Applicant suffered substantial financial loss, including loss of initial deposits, the incurring of additional holding costs, and expenditures in rectifying defects and delays that ought not to have arisen had the Respondent conducted itself lawfully and fairly.

4.4 The Respondent’s conduct amounts to a repudiation of the Contract and contravention of essential consumer protection provisions under Commonwealth legislation, thereby entitling the Applicant to seek damages and other relief as the Court deems just.

The cross claim

7    Creation’s further amended notice of cross claim seeks payment of a specific amount said to be due under the contract, damages for breach of the contract and interest. The basis of these claims is set out in the further amended statement of cross claim. It is sufficient to note at this point that Creation alleges that:

(a)    Ms Wang failed to pay a progress claim in the amount of $51,800 that was due under the contract; and

(b)    Creation terminated the contract in accordance with its terms in January 2020 and, pursuant to the contact, is entitled to recover:

(i)    the total costs it incurred over and above what it received from Ms Wang ($73,302.66), plus a “builder’s margin” ($41,440); or alternatively

(ii)    $12,950, being five percent of the contract price of $259,000.

The course of the proceeding

8    Ms Wang conducted the litigation in person. On 30 June 2025, she filed an interlocutory application seeking to have the cross claim summarily dismissed or struck out, together with a supporting affidavit and written submissions. On 21 July 2025, the Registrar who was case managing the proceeding ordered that this application be heard at the same time as the cross claim.

9    Ms Wang relied on the primary affidavit she had affirmed on 23 February 2025, the affidavit she had affirmed in support of her summary dismissal, and a further affidavit affirmed on 20 October 2025. Creation relied on an affidavit of one of its employees, David Dakin, affirmed on 22 April 2025, to which was exhibited a bundle of relevant documents. Counsel for Creation also tendered a small number of additional documents at the hearing, which were received without objection.

10    Ms Wang’s affidavits consisted in large part of submissions rather than evidence. Counsel for Creation handed up a schedule of objections to these aspects of the affidavits but did not insist that I rule on these as a preliminary matter. This was an efficient way to approach the hearing.

11    At the hearing on 18 December 2025, Ms Wang expressed an understanding that she was only there to argue her application for summary dismissal of the cross claim. As noted above, an order had been made for that application to be listed for hearing at the same time as the cross claim itself. The proceeding was listed on 18 and 19 December for hearing on all outstanding issues. However, Ms Wang sought only a relatively short adjournment to prepare herself for argument on the other issues, and the hearing was able to be completed on 18 December.

12    Ms Wang relied on a Mandarin interpreter at the hearing, and it was apparent that she had very limited English. Despite this, her affidavits were written in English and witnessed by a solicitor without any accompanying declaration that their contents had been rendered into Mandarin before she affirmed them. I asked Ms Wang whether she had written the affidavits in English herself and she answered that she had. I am very doubtful that this is true.

13    The drafting of the documents filed by Ms Wang, including her affidavits, has some of the hallmarks of having been produced by a generative artificial intelligence (AI) application. While they do not contain references to non-existent authorities (a phenomenon that has been remarked upon in several recent cases), they have a prose style that appears at first blush to show a significant facility for written English but, upon inspection, dissolves into empty rhetoric. An example is the extract from the statement of claim set out above. Another example is Ms Wang’s oral submissions on her summary dismissal application, which she provided in written form to the Court the night before the hearing in Mandarin and English. The English text read, in part (retaining the original spelling, punctuation and use of square brackets):

Before turning to the merits, it should be noted that the defendant has Further amended its pleadings at least 6 counts, filed defence and cross claim in Feb 2025, reprobates in amended and further amended defence, cross-claim and replies (CB pp 90, 128, 139, 158, 166, 175) in May 2025, further reprobates in further amended versions filed on 30 October 2025 (CB pp 598, 610, 614, 624).

There isn’t any credit in respondent pleading, Both cross claim and original claim intersect at one justiciable controversy giving rise to one question requiring one authoritative conclusion.

[When is the Finance Approved?]

Your Honour, the Respondent Approbates and Reprobates on the face of the record:”

At Respondent Affdavit CB: 225 ［26］and CB: 149 ［5b］, they Approbate the 2017 Settlement to validate the Land Contract and their commission.

At Respondent pleading CB: 602 ［8d］ and CB: 149 ［6］, they Reprobate the necessary funding for that settlement, claiming finance did not exist until 2018 to excuse their construction

14    I asked Ms Wang whether she had used AI in preparing her documents. She said (as translated by the interpreter) that she had written her documents herself and used AI to “go over them”. I am not sure what this means. However, given Ms Wang’s limited English skills and the very short answers that she gave to any questions that called for her to depart from her written script, I doubt whether she wrote much if any of the material herself (in English or otherwise). One curious feature of the material filed by Ms Wang is that, while her pleadings and affidavits are for the most part in grammatically correct English, the prepared statement that she used for her oral submissions was not. The issue identified in the extract from her oral submissions set out above also appears to have little, if anything, to do with the pleadings.

15    While it is understandable that a person conducting proceedings on their own behalf would wish to use any available assistance, generative AI is notoriously not an expert system: it strings together words, to create something that looks plausibly like a response to a question, without having any understanding of what those words mean. There is a serious question as to whether courts and opposing parties should be expected to try to deal with material produced in this way, if it has not been reviewed and adopted by a person who understands the issues and can elaborate on them in an oral hearing. In this case, despite that concern, I have treated Ms Wang’s written material as embodying the case she seeks to present and dealt with it to the extent that it can be understood.

Chronology of events

16    Neither of the witnesses was cross-examined and the essential facts are not seriously disputed. The events relevant to the disposition of the case emerge reasonably clearly from the contemporaneous documents that have been tendered.

17    In December 2015 Ms Wang completed a document entitled “Expression of Interest” on Creation’s letterhead, giving details of the property she was in the process of acquiring. On 23 December 2015, Creation issued an invoice for payment of a deposit of $12,950. Ms Wang paid this amount. Ms Wang executed a contract to purchase the land on 28 January 2016.

18    The parties entered into the contract on 2 February 2016. Some of its terms will need to be mentioned below.

19    On 3 July 2017 Creation was advised by Ms Wang’s solicitor that the survey plan, creating the lot which Ms Wang had contracted to purchase, had been registered on 30 June 2017.

20    On 27 July 2017 a bank approved finance in the amount of $1,120,000. This was for the purchase of the integrated land and house package. The land and two other properties owned by Ms Wang were listed as security. Funds were advanced on 22 August 2017 and Ms Wang’s purchase of the property settled on 30 August 2017.

21    By 21 November 2017 Creation had submitted plans to the local Council for approval. As at that date, the approval process was awaiting a sewer permit. Building approval was not received until 6 March 2018.

22    On 7 March 2018 Creation sent an email to Ms Wang asking for confirmation that she had finance approved for the construction work or funds available in a bank account. Creation sent follow-up emails to Ms Wang on 14, 19 and 22 March. On 22 March Ms Wang advised that her “construction loan is ready” and provided details of her “contact banker”. Creation contacted Ms Wang’s banker on 22 March seeking a copy of the loan approval documents and eventually received the loan approval letter on 5 April 2018. That document was dated 10 August 2017. Creation sent a “site start letter” to Ms Wang on 11 April 2018, advising her that works would commence on 16 April 2018.

23    Construction work commenced on or around 16 April 2018.

24    By 27 April 2018 (the date of relevant inspection certificates) excavation had occurred and piers were in place. Further inspection reports were issued on 2 and 3 May 2018 and on 4 May 2018 Creation advised Ms Wang that the slab would be poured over the coming weekend.

25    On 8 May 2018 Creation issued the Base Stage Progress Claim contemplated by cl 4 of the contract, in the amount of $38,850. A photograph annexed to that Claim indicates that that the works relevant to it had been completed by this time and there is no evidence to the contrary. Ms Wang paid this progress claim.

26    Work then commenced on the wall frames, roof trusses and first floor beams and joists (the Frame stage). Compliance certificates were issued in relation to aspects of this work on 10 and 29 May 2018. It is not clear exactly when this work was completed, but a photograph of the completed frame was attached to an email to Ms Wang, dated 30 May 2018. That email also attached Creation’s invoice for the progress claim contemplated by the contract at this stage (“the Frame stage claim”) in the amount of $51,800.

27    Creation sent a follow-up email seeking payment of the Frame stage claim on 13 June 2018. Ms Wang replied on 14 June, as follows.

My construction loan and land loan were approved together at the beginning of last year.

However due to the delay of the construction, my construction loan has terminated three month after the approval and signed contract.

I have reapply the loan with STG bank.

Please allow 42 days for the bank to approve the loan and release the fund.

28    On 15 June 2018 Creation issued a notice of suspension of works, due to the overdue payment of the Frame stage claim, under cl 18 of the contract. Work was to remain suspended until the outstanding amount had been paid and confirmation of unconditional finance approval was provided.

29    On 16 July 2018 Creation sent an email to Ms Wang seeking an update on her application for finance. A solicitor acting for Ms Wang replied later the same day, in the following terms.

The land settlement for the above property were effected on 22 August 2017 and our client obtained finance approval for constructions at that time. Unfortunately, our client’s construction loan expired due to the delay of construction.

Ms Wang tried to re-apply for her construction loan and made inquiries with different lenders but was informed that loan approval will not be granted where construction has already commenced.

Ms Wang would like to request the builder’s consent to complete the construction work first. After the construction completes, Ms Wang will apply re-finance over the property and will use the settlement funds from refinancing to make a full repayment to the builder.

30    The evidence does not include any direct response to the proposal in the final paragraph of this extract. Mr Dakin deposes that Creation did not accept this proposal. The basis for this assertion is not apparent, but it was not the subject of any objection or cross-examination and is consistent with the picture that emerges from the documents.

31    Creation sent an email to Ms Wang seeking an update on her application for finance on 20 August 2018.

32    Ms Wang did not pay the Frame stage claim or provide any further updates in relation to her attempts to obtain finance. Nothing further seems to have happened until 10 January 2020, when Creation sent Ms Wang a Notice to Remedy under cl 25.3 of the contract in relation to the non-payment of the Frame stage claim (the Notice to Remedy).

33    On 28 January 2020 Creation issued a Notice of Termination under cl 25.4 of the contract.

34    The present proceeding, as noted earlier, was commenced on 23 December 2024.

The contract

35    The contract was in a standard form entitled “Queensland Peace of Mind New Home Construction Contract (QC2 2015)”. The contract price was $259,000, which was to be paid progressively in stages that were set out in Schedule 2. There was to be a deposit of $12,950 and a Base stage payment of $38,850 (which, as noted above, Ms Wang paid). The remaining stages were $51,800 to be paid when wall and roof frames were complete (the Frame stage claim mentioned above); $64,750 to be paid when external wall cladding and roof covering was fixed; $51,800 when all internal linings were fitted and fixed; and $38,850 on practical completion.

36    Clauses 1.2 and 4.7 required Ms Wang to ensure payment of each claim by its respective due date. The due date for each progress claim was 5 working days after receipt of that claim (cl 4.5).

37    Clause 2.1 required Creation to commence “physical construction” within 20 working days after the later of:

(a)    confirmation by Ms Wang of her capacity to pay (cl 7.1) or the obtaining of finance (cl 7.2); or

(b)    Creation receiving all permissions, consents and approvals required from relevant authorities.

38    Creation, as the builder, was responsible for obtaining relevant approvals and consents (cls 2.3, 2.4). It was under a duty to take reasonable steps to do this within 60 days after the date of the contract, but any delays in approvals were “claimable delays” under cl 16.2 on the footing that these were not within the builder’s sole control.

39    Clause 18.1 entitled Creation to suspend work under the contract in various circumstances including where Ms Wang did not pay a progress claim as required by cl 4.

40    Clause 25.2 entitled Creation to issue a notice to remedy breach in specified circumstances, including for non-payment of progress claims. Clause 18.4 expressly provided that suspension of work for this reason did not preclude steps to terminate the contract being taken on the basis of the same non-payment. If the relevant breach was not remedied within ten working days, subject to a presently irrelevant exception, cl 25.4 entitled the party that had issued the notice to issue a separate notice terminating the contract.

41    Clause 25.7, which was entitled “Builder’s rights”, provided as follows.

On this contract being ended by the builder under Clauses 2, 21, 25 or 26 the builder may, without prejudice to any other rights or remedies that the builder may have under this contract or at law, recover from the owner a debt due and owing the greater of following amounts:

(a)    5% of the contract price; or

(b)    damages including:

(i)    the cost of all work carried out by the builder under this contract;

(ii)    the cost to the builder of any materials purchased by the builder and delivered to the site or ordered by the builder from suppliers and which orders can not be cancelled;

(iii)    the cost to the builder of quitting the site;

(iv)    the builder’s margin on the total of the amounts payable under subparagraphs (i), (ii) and (iii);

(v)    default interest on any unpaid moneys under Clause 30; and

(vi)    all other costs and losses incurred by the builder as a consequence of this contract being ended.

(Emphasis in original.)

42    Clause 25.8 provided that nothing in cl 25 was to prejudice any other rights of recovery in the event of a breach of the contract.

The claim under the ACL

43    Ms Wang’s claim under the ACL is not articulated clearly in the statement of claim. In written submissions filed in January 2025, purportedly seeking default judgment against Creation, the case was encapsulated in this way

2.2 The Respondent’s conduct allegedly contravened section 18 of the ACL, by providing misleading or deceptive representations as to construction progress, and contravened section 21 of the ACL, by engaging in unconscionable dealings in withholding critical notifications from the Applicant’s mortgage lender.

44    In her submissions filed in September 2025, Ms Wang described the object of Creation’s “scheme” as follows.

a) To excise the independent quality control mechanism, the Applicant’s financier, St. George Bank, by a considered delay in the commencement of works until the Applicant’s finance facility had necessarily lapsed.

b) To then purport to terminate the Contract based on a non-payment that was the direct and intended consequence of its own antecedent misconduct, thereby creating a pretext to retain the Applicant’s 20% deposit and other payments.

45    Her articulation of how Creation’s conduct is said to have been misleading or deceptive appears to consist of the following passage later in the submissions.

By remaining silent and failing to act, it created the false representation that performance was forthcoming under the agreed terms, while concealing the material fact of its contrary intent to subvert those terms. In circumstances where disclosure is reasonably expected, silence or inaction can constitute misleading or deceptive conduct under s 18 of the ACL, as the failure to speak may amount to such conduct particularly in contractual negotiations.

46    Sections 18 and 21 of the ACL provide, relevantly, as follows.

18 Misleading or deceptive conduct

(1)    A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.

…

21 Unconscionable conduct in connection with goods or services

(1)    A person must not, in trade or commerce, in connection with:

(a)    the supply or possible supply of goods or services to a person; or

(b)    the acquisition or possible acquisition of goods or services from a person;

engage in conduct that is, in all the circumstances, unconscionable.

…

(3)    For the purpose of determining whether a person has contravened subsection (1):

(a)    the court must not have regard to any circumstances that were not reasonably foreseeable at the time of the alleged contravention; and

(b)    the court may have regard to conduct engaged in, or circumstances existing, before the commencement of this section.

(4)    It is the intention of the Parliament that:

(a)    this section is not limited by the unwritten law relating to unconscionable conduct; and

(b)    this section is capable of applying to a system of conduct or pattern of behaviour, whether or not a particular individual is identified as having been disadvantaged by the conduct or behaviour; and

(c)    in considering whether conduct to which a contract relates is unconscionable, a court’s consideration of the contract may include consideration of:

(i)    the terms of the contract; and

(ii)    the manner in which and the extent to which the contract is carried out;

and is not limited to consideration of the circumstances to formation of the contract.

47    The right to recover damages for conduct in breach of these provisions is conferred by s 236, which provides as follows.

236    Actions for damages

(1)    If:

(a)    a person (the claimant) suffers loss or damage because of the conduct of another person; and

(b)    the conduct contravened a provision of Chapter 2 or 3; the claimant may recover the amount of the loss or damage by action against that other person, or against any person involved in the contravention.

(2)    An action under subsection (1) may be commenced at any time within 6 years after the day on which the cause of action that relates to the conduct accrued.

(Emphasis in original.)

48    Creation submits that Ms Wang’s action was commenced outside the time permitted by s 236(2) and is therefore not maintainable. This submission is correct.

49    The cause of action accrues, for the purposes of s 236(2), when damage is actually suffered: Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 at 532-533 (Mason CJ, Dawson, Gaudron and McHugh JJ). This is the case even if the damage is not discovered until some later time. There is no provision for extending the time limit in s 236(2) and the Court does not have any implied discretion to extend time (see eg Keen Mar Corp Pty Ltd v Labrador Park Shopping Centre Pty Ltd (1988) ATPR 40-853 at 49.196 (Pincus J)).

50    Ms Wang’s statement of claim and submissions are somewhat opaque as to exactly what loss or damage she claims to have suffered.

(a)    To the extent that her claim alleges loss arising from the delay in commencing construction work, the form that the alleged loss took appears to be the expiry of her construction loan and the inability to obtain fresh finance. If this is what occurred, the evidence is that it occurred by July 2018 (when Ms Wang referred to the expiry of the loan as the reason why she had not paid the Frame stage claim invoice) at the latest.

(b)    To the extent that the claim relies on an alleged failure to provide timely reports or facilitate inspections and “misleading” reports about construction progress, these defaults and their consequences for Ms Wang must also have been complete by around the middle of 2018: there is no suggestion work was carried out after 30 May 2018 and Creation reported the completion of the Frame stage at that time. The only events affecting Ms Wang’s position after that time were the suspension of works on 15 June 2018 and termination of the contract in January 2020, and these were things to which she was necessarily exposed by her failure to pay the Frame stage claim invoice in early June 2018.

(c)    To the extent that the claim relies on alleged “bypassing” of critical construction stages (and noting that how this constitutes a breach of s 18 or 21 of the ACL is far from clear), any loss or damage to Ms Wang would have occurred when the deficient construction work was completed. There is no evidence that work was done after 30 May 2018.

51    On any understanding of the ACL claim, therefore, the relevant damage occurred more than six years before the commencement of the proceeding. The application must be dismissed in so far as it relies on the ACL.

52    Although it is not strictly necessary, I add that Ms Wang’s claim as presented has no substance in so far as it relies on the ACL.

(a)    First, there is no evidence of any conduct by Creation that was misleading or deceptive. Beyond bald assertions, Ms Wang has not attempted to demonstrate that any conduct of Creation contravened s 18 of the ACL.

(b)    Secondly, the only identifiable basis for a claim of unconscionable conduct under s 21 of the ACL appears to be the delay in commencing construction (which apparently caused Ms Wang to have no finance in place when payments needed to be made). While there was clearly a very significant delay between the date of the contract and the commencement of construction, this does not point to any failure (let alone one that was “unconscionable”) on the part of Creation. Ms Wang did not become the legal owner of the land until 30 August 2017, and Creation submitted plans to the Council at some time before 21 November 2017 (the evidence does not show exactly when). No construction work could realistically begin before Council approval, which was received on 6 March 2018. Creation contacted Ms Wang the next day seeking to confirm that she had finance in place. That confirmation (which seems in retrospect to have been incorrect) was not received until 5 April 2018 and construction began on 16 April. Creation was not the author of the delay.

The contract claim

53    The contract claim is not developed in Ms Wang’s submissions but appears to involve an assertion that Creation did not begin construction within the required time frame.

Limitation period

54    Creation submits that this claim is statute barred. Creation’s written submissions relied on s 14(1)(a) of the Limitation Act 1969 (NSW) (the NSW Act); however, in oral submissions it was suggested that the applicable provision was s 10(1)(a) of the Limitation of Actions Act 1974 (Qld) (the Queensland Act). In either case, the relevant limitation period is six years.

55    Questions as to which limitation statute applies to a common law claim brought in federal jurisdiction are affected by ss 79 and 80 of the Judiciary Act 1903 (Cth) (the Judiciary Act) and, perhaps surprisingly, may be complicated. The understanding of what exactly these provisions do and how they fit together has changed over time and may not be completely settled. It has produced a rich vein of commentary by distinguished writers.

56    Sections 79 and 80 provide as follows.

79 State or Territory laws to govern where applicable

(1)    The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable.

(1A)    For the purposes of subsection (1), a Court exercising federal jurisdiction in a proceeding is taken to be exercising federal jurisdiction in:

(a)    if the laws of a State or Territory apply to a part of the proceeding because of subsection 68C(5)—that State or Territory; or

(b)    if paragraph (a) does not apply:

(i)    if the proceeding is transferred or remitted—the State or Territory to which the proceeding is transferred or remitted; and

(ii)    otherwise—the State or Territory in which the proceeding is commenced;

except as otherwise provided by the Constitution or the laws of the Commonwealth.

(2)    A provision of this Act does not prevent a law of a State or Territory covered by subsection (3) from binding a court under this section in connection with a suit relating to the recovery of an amount paid in connection with a tax that a law of a State or Territory invalidly purported to impose.

(3)    This subsection covers a law of a State or Territory that would be applicable to the suit if it did not involve federal jurisdiction, including, for example, a law doing any of the following:

(a)    limiting the period for bringing the suit to recover the amount;

(b)    requiring prior notice to be given to the person against whom the suit is brought;

(c)    barring the suit on the grounds that the person bringing the suit has charged someone else for the amount.

(4)    For the purposes of subsection (2), some examples of an amount paid in connection with a tax are as follows:

(a)    an amount paid as the tax;

(b)    an amount of penalty for failure to pay the tax on time;

(c)    an amount of penalty for failure to pay enough of the tax;

(d)    an amount that is paid to a taxpayer by a customer of the taxpayer and is directly referable to the taxpayer’s liability to the tax in connection with the taxpayer’s dealings with the customer.

80 Common law to govern

So far as the laws of the Commonwealth are not applicable or so far as their provisions are insufficient to carry them into effect, or to provide adequate remedies or punishment, the common law in Australia as modified by the Constitution and by the statute law in force in the State or Territory in which the Court in which the jurisdiction is exercised is held shall, so far as it is applicable and not inconsistent with the Constitution and the laws of the Commonwealth, govern all Courts exercising federal jurisdiction in the exercise of their jurisdiction in civil and criminal matters.

57    Section 79(1A) was inserted by the Courts and Tribunals (2021 Amendment Measures No. 1) Act 2021 (Cth), with effect from 18 February 2022, and applies to proceedings commenced after that date (Sch 2 items 8-9).

58    In Commonwealth v Mewett (1997) 191 CLR 471 at 527-528, Gaudron J treated s 80 as the starting point and as leading to the position that the law governing a claim in tort or contract (including as to the applicable limitation period) was the law of the place having the closest connection with the relevant events or with the contract as the case may be. This position was arrived at by the application, pursuant to s 80, of the common law rules for choice of law and an understanding of how those rules operate as between the various elements of a federation (see at 522, and Blunden v Commonwealth [2003] HCA 73; 218 CLR 330 at [18] (Blunden)). This understanding was adopted by the majority in John Pfeiffer Pty Ltd v Rogerson [2000] HCA 36; 203 CLR 503 (John Pfeiffer), where it was established that the law governing all matters of substance in a claim in tort with an interstate element was the law of the State or Territory in which the impugned conduct occurred. It was also treated as correct by the Court in Blunden (although the relevant conduct in that case took place at sea, which raised different choice of law questions).

59    One aspect of the operation of s 80 noted in Blunden at [18] was that, to the extent that common law choice of law rules are modified by statute, it is the statute law of the State or Territory in which the Court “is held” (which I will refer to as “the forum state”) that is to be applied. However, in New South Wales (where this proceeding was commenced and where the hearing took place) the law in force includes s 5 of the Choice of Law (Limitation Periods) Act 1993 (NSW) (NSW Choice of Law Act), which provides that, if the substantive law of another State or Territory is to govern a claim before a court of NSW, a “limitation law” of that other State or Territory “is to be regarded as part of that substantive law and applied accordingly”. On the understanding of s 80 enunciated in Blunden this serves to confirm, for the purposes of a matter in federal jurisdiction heard in New South Wales, the position arrived at in John Pfeiffer: that the relevant limitation statute is that of the jurisdiction whose laws govern the substantive issues in the proceeding.

60    Applying this analysis to the present case, it is tolerably clear that the relevant limitation statute is that of Queensland. The subject matter of the contract is the construction of a residence on land situated in Queensland and the parties stipulated in cl 35.4 that the contract was to be construed in accordance with the law of that State. The system of law with which the contract has the most real connection is Queensland (cf eg Bonython v Commonwealth (1948) 75 CLR 589 at 601-602 (Latham CJ)). The proper law of the contract is thus the law in force in Queensland and the relevant law for resolving questions about the rights and obligations of the parties under the contract is the law in force in that State (ie, common law principles of contractual interpretation together with any Commonwealth or Queensland statutes that relevantly modify those principles).

61    The decision in Rizeq v Western Australia [2017] HCA 23; 262 CLR 1 (Rizeq) adds some complexity to this picture. Mr Rizeq was a resident of New South Wales who was tried for a drug offence in Western Australia and convicted by a majority verdict pursuant to a law of that State. The Court in which Mr Rizeq was tried was exercising federal jurisdiction even though he was accused of contravening a State law. He argued in the High Court that the provision creating the relevant offence applied in the proceeding only as a surrogate Commonwealth law by force of s 79 of the Judiciary Act, and that his conviction on the basis of a majority verdict was therefore inconsistent with s 80 of the Constitution (which applies to the trial of indictable offences against laws of the Commonwealth). This argument failed. The Court held that the offence-creating provision imposed criminal liability as a law of Western Australia and was applied by the trial court as part of the composite system of law applying to the conduct of persons in that State. The provision for majority verdicts, on the other hand, was “picked up” and applied to the proceeding as Commonwealth law by s 79; however, this did not create any conflict with s 80 of the Constitution because the relevant offence was not one against a law of the Commonwealth.

62    Rizeq holds that the only State and Territory laws that are picked up by s 79 are laws which regulate the exercise of the Court’s powers, including the manner in which and conditions on which those powers may be exercised. Section 79 fills a gap created by the inability of the States and Territories to enact laws that govern the exercise of federal jurisdiction of their own force. As explained in the joint judgment of Bell, Gageler, Keane, Nettle and Gordon JJ at [63]:

The section fills that gap by picking up the text of a State law governing the exercise of State jurisdiction and applying that text as a Commonwealth law to govern the manner of exercise of federal jurisdiction. The section has no broader operation.

63    In this understanding, s 79 does not do any work in relation to laws that apply “independently of anything done by a court” (at [105]) or that are directed to the rights and duties of persons (at [20] (Kiefel CJ)). The plurality described such laws (at [56]) as part of:

…the single composite body of federal and non-federal law that is applicable to cases determined in the exercise of federal jurisdiction in the same way, and for the same reason, as they form part of the same single composite body of law that is applicable to cases determined in the exercise of State jurisdiction — because they are laws.

64    Rizeq was applied in Masson v Parsons [2019] HCA 21; 266 CLR 554 (Masson). Its reasoning creates complication for present purposes because, rather than using the distinction (often applied in the choice of law context) between “substantive” and “procedural” laws, the Court saw the critical distinction as being between laws applying “independently of anything done by a court” and laws “governing the exercise of State jurisdiction”: the former are laws that bind the parties and fall to be applied in any proceeding whether in federal jurisdiction or not; the latter are laws binding the court, and apply only because they are picked up and applied in federal jurisdiction by operation of s 79. Laws which bar proceedings by reason of the effluxion of time (but do not extinguish the underlying cause of action), such as the limitation statutes potentially relevant in the present case, were referred to as an example of laws of the latter kind (Rizeq at [22] (Kiefel CJ), [89] (Bell, Gageler, Keane, Nettle and Gordon JJ), [202] (Edelman J); see also Masson at [63] (Edelman J)).

65    Arguably, this suggests that a State or Territory limitation statute binds the Court only by operation of s 79; and s 79 according to its terms applies only the statutes of the State or Territory in which the court is sitting. On this view, the Court would apply the NSW Act in the present case, even if a court exercising non-federal jurisdiction in a similar claim would apply the Queensland Act. This would not make a difference to the outcome of the present case but would clearly represent a significant departure from the law as understood prior to Rizeq. One question that arises on this understanding is whether the NSW Choice of Law Act is a law which regulates the exercise of jurisdiction and therefore would also be picked up by s 79 (and what follows if that is the case). Arguably, the NSW Choice of Law Act binds how the Court may approach the granting of a remedy by prescribing the applicable legislation and is part of the statute law picked up by s 79. However, its effect is to modify (or, since John Pfeiffer, probably merely confirm) the content of choice of law rules which, at least arguably according to this theory, would themselves be overridden by s 79 picking up and applying the NSW Act. This is not a matter which presently needs to be resolved here.

66    Another possible understanding of the effect of Rizeq is that, because the forum State’s limitation law must be construed in the light of normal choice of law principles (and is picked up by s 79 with its meaning unchanged: Rizeq at [81]), that law does not apply where those choice of law principles call for the application of the limitation law of a State or Territory other than the forum State. There being no provision in s 79 to pick up the laws of any jurisdiction other than the forum State, no limitation statute would apply. This, clearly, would have important consequences in the present case and would represent a very significant departure from the position as understood before the decision in Rizeq. It would mean that statutes of limitation could be avoided by the claimant in any case where it was possible to engage federal jurisdiction.

67    The issues arising from the reasoning in Rizeq in relation to choice of law in cases with an interstate aspect have been canvassed in, eg, Stellios J, “Choice of Law in Federal Jurisdiction After Rizeq v Western Australia” (2018) 46 Australian Bar Review 187 at 194-203; Gummow W, “The Law Applicable in Federal Jurisdiction” in Griffiths J and Stellios J (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines (Federation Press, 2020) 117-118 and Lindell G, “Other Reflections on the Applicable Law in the Light of Rizeq and Masson v Parsons” in Griffiths J and Stellios J (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines (Federation Press, 2020) 128-133.

68    The Full Court in Hitachi Construction Machinery (Australia) Pty Ltd v Coal Mining Industry (Long Service Leave Funding) Corporation [2024] FCAFC 166; 306 FCR 486 at [173]-[190] (Hitachi) set out a detailed summary of the principles of law to be derived from Rizeq, which has assisted me in framing this part of my reasons. However, Hitachi did not involve the issue in question here: the point that arose in that case was whether a State limitation statute could apply to the resolution of a claim under a Commonwealth Act.

69    In Commonwealth v Winston [2024] NSWCA 277; 116 NSWLR 111 at [17] (Winston) Leeming JA, in the course of explaining why the NSW Act applied in that case, said at [17(5)]:

True it is that Blunden predates what was said of s 79 of the Judiciary Act in [Rizeq] and [Masson]. However, the approach taken in Rizeq and Masson diminishing the need to rely on a law of the Commonwealth in order for a State law to be applicable to a matter in federal jurisdiction cannot assist Mr Winston (although those decisions may require aspects of the operation of s 80 to be revisited in the future: see J Basten, “Judiciary Act, Section 80 – A Special Statutory Provision?” (2024) 98 Australian Law Journal 727). While it is conceivable that at least parts of the Limitation Act … apply of their own force in accordance with Rizeq and Masson, there is nothing to suggest that, in the event that all or part of the Limitation Act does not apply of its own force, it does not continue to be made applicable by s 80.

70    Winston, however, was a case of the same kind as Blunden: it concerned claims in tort arising from events at sea and the application of the forum State’s limitation laws, rather than any question about which (if any) limitation law applies in federal jurisdiction to a common law claim arising out of events in a jurisdiction other than the forum State.

71    I was not referred by the parties to any cases addressing the particular issue that arises in this case and my own research has not uncovered any decision specifically addressing the effect of the decision in Rizeq on the applicability of statutes of limitation in cases such as the present one.

72    In my view the issue is to be resolved as follows.

(a)    First, s 79 applies only to the extent that the Constitution and the laws of the Commonwealth do not otherwise provide. One of the relevant laws of the Commonwealth is s 80. The effect of s 80 must be fully understood before any recourse is had to s 79.

(b)    Secondly, the Court in Rizeq expressly left any further consideration of s 80 for another day (at [14] (Kiefel CJ), [79] (Bell, Gageler, Keane and Gordon JJ)). No change is suggested to the pre-existing understanding of what that section does. However, the context in which s 80 must be interpreted is affected by what was decided about s 79 in Rizeq.

(c)    Thirdly, the distinction highlighted in Rizeq (between laws that apply irrespective of anything done by a court and laws which apply to the exercise of jurisdiction) determines what laws are picked up by s 79 but has nothing to say about s 80. Where a common law claim with an interstate element arises in federal jurisdiction, common law choice of law rules (which, following John Pfeiffer, bring to bear the limitation law of the jurisdiction whose substantive law governs the claim) apply as part of the law relevant to determining that claim. This, as has been noted (Rizeq at [56]), is not a “choice of law” process in the ordinary sense but a process of identifying which aspects of Australia’s composite system of laws govern the resolution of the dispute. In federal jurisdiction, the relevant body of law will depend on the facts of the case (potentially including where events occurred) but will be the same regardless of where in Australia the proceeding is commenced or heard. The application of the common law is confirmed by s 80, but it is arguable that the common law (as modified by relevant statutes) is part of the body of laws that apply to the dispute in any event (“because they are laws”, as the plurality put it in Rizeq).

(d)    Fourthly, if that process of identification points to the application of the limitation statute of a jurisdiction other than the forum State, that statute applies as part of the law relevant to the resolution of the dispute. This too may be seen as an effect of s 80 or as part of the direct application of common law principles to the facts of the case. No recourse to s 79 is necessary; there is no “gap” needing to be filled. Indeed, application of the forum State’s limitation law pursuant to s 79 is precluded by the application of the venue State’s limitation law. Again, s 79 applies subject to s 80; and the Rizeq reasoning limits, rather than expands, the operation of s 79.

(e)    Fifthly, if necessary, s 80 can be understood to be performing the same role as s 79 to the extent that it brings to bear State or Territory laws that affect the exercise of a court’s jurisdiction and are brought into play by choice of law rules (such as limitation statutes): that is, it gives such laws the force of a law of the Commonwealth and thereby overcomes the lack of power in State and Territory legislatures to enact laws controlling the exercise of federal jurisdiction.

73    This reasoning takes up suggestions by Professor Lindell at pp 123-124 and 128-132 in the article referred to at [67] above and is consistent with the observation about the effect of s 80 in the extract from Winston set out at [69] above. It also draws on the thoughtful analysis in Mark Leeming, Common Law, Equity and Statute: A Complex Entangled System (Federation Press, 2023) at 288-298. Applying this reasoning in the present case, s 10 of the Queensland Act applies to Ms Wang’s contract claim.

74    A cause of action in contract accrues when the relevant breach occurs: see, eg, Cork v AAL Aviation Ltd [2014] FCA 1085 at [41] (Foster J). The breach alleged in Ms Wang’s statement of claim appears to turn on delay by Creation in commencing construction. Any breach of the contract in the present case occasioned by such delay must have been complete, at the latest, by 20 working days after 5 April 2018 (that being the date when Creation received confirmation of finance from Ms Wang’s banker). The claim in contract is therefore out of time. No reason why the limitation period should be extended has been suggested.

The substance of the claim

75    Because a possible (although in my view incorrect) understanding of the effect of Rizeq is that no limitation statute is applicable, it is necessary to say something concerning the substance of Ms Wang’s contract claim.

76    As noted earlier, cl 2.1 of the contract required Creation to commence “physical construction” within 20 working days from the later of two relevant events: confirmation by Ms Wang of her capacity to pay or the obtaining of finance; or the receipt of all permissions, consents and approvals required from relevant authorities. The evidence indicates that final approvals were received from Council on 6 March 2018. However, Creation contacted Ms Wang the following day to seek confirmation that she had finance in place, which indicates that such confirmation had not previously been provided. Ms Wang did not attempt to prove the contrary. This means that the event which caused time to run under cl 2.1 was the provision of confirmation by Ms Wang’s banker, which did not occur until 5 April 2018.

77    Construction commenced on or around 16 April 2018, which was comfortably within the time permitted by cl 2.1 of the contract if that time is calculated from 5 April 2018. There is therefore no need to consider the effect of Ms Wang’s later statements that her construction loan had expired some time earlier (which tend to suggest that, to the extent that her banker asserted the existence of a loan on 5 April 2018, that assertion was untrue).

78    The contract claim as articulated has no substance and must be dismissed.

The cross claim

79    Creation alleges that:

(a)    Ms Wang breached the contract by failing to make payment of $51,800 for the completion of the Frame stage;

(b)    that breach gave rise to a right to suspend the work, which Creation did;

(c)    the suspension continued and gave rise to the right to issue a Notice to Remedy a breach; and

(d)    the Notice to Remedy was given and the breach was not rectified, following which Creation terminated the contract giving rise to its claim for damages.

80    On this basis, Creation claims, pursuant to its rights under the contract:

(a)    the amount of the unpaid Frame stage claim ($51,800);

(b)    “damages” under cl 25.7(b) in the amount of $114,742.66, or alternatively $12,950 (being 5 percent of the contract price) under cl 25.7(a); and

(c)    interest on both amounts.

81    On the evidence before the Court, the Frame stage was completed by 30 May 2018 and Creation sent its invoice for the Frame stage claim to Ms Wang on that date. Ms Wang has not attempted to prove otherwise. Ms Wang has not paid that progress claim. There is no apparent reason why Creation should not be able to recover the relevant amount.

82    I also accept Creation’s submission that Ms Wang’s failure to pay the Frame stage claim by the due date entitled it to issue a notice of suspension of works under cl 18.1 of the contract and subsequently a notice to remedy breach. The breach was not rectified and Creation was therefore entitled to issue a notice of termination, which it did on 28 January 2020. Creation is therefore entitled to recover from Ms Wang pursuant to cl 25.7 of the contract.

83    The claimed amount of $114,742.66 is supported by calculations set out in the affidavit of Mr Dakin. These calculations were not challenged.

84    Interest is sought on both amounts at the rate of 15 percent per annum. Item 8 of Schedule 1 to the contract specifies this as the “default interest rate” which, by cl 30.1, the builder is entitled to charge “from the day on which an amount falls due to be paid to the builder up to and including the day that amount is paid”. I am satisfied that cl 30.1 applies both to the amount of any unpaid progress claim and to any amount that Creation becomes entitled to recover under cl 25.7.

85    The entitlement of Creation under cl 25.7 arises from its exercise of its right to issue a notice of termination, which occurred on 28 January 2020. Its cross claim, which was filed on 11 February 2025, was therefore within the limitation period provided by the Queensland Act in so far as that entitlement is concerned.

86    The cross claim is out of time in so far as it seeks payment of the amount of the Frame stage claim (which was due within 5 working days after 30 May 2018). However, the limitation period was not pleaded by Ms Wang or invoked in any other way. At the end of the hearing, after counsel for Creation had accepted that this aspect of the cross claim would be barred if the limitation period had been pleaded, I flagged the issue to Ms Wang and asked whether she wanted to say anything about it, but no submission (or application) was forthcoming.

87    It is well established that limitation provisions of the kind seen in s 10 of the Queensland Act operate to prevent an enforcement of a common law right of action (rather than imposing a condition inherent to the existence of the relevant right) and that the limitation must therefore be pleaded by the respondent if it is to be applied: see eg Australian Iron & Steel Ltd v Hoogland (1962) 108 CLR 471 at 488 (Windeyer J)). It is not the task of the Court to apply a limitation provision if the party to whose benefit it operates has chosen not to rely on it. I have considered whether it might be said that Creation’s own invocation of the limitation period in respect of closely related events should be regarded as precluding it from relying on Ms Wang’s failure to plead the limitation period in answer to its cross claim. However, I have not found any support for such a proposition in the authorities and it appears to be inconsistent with the established position that limitation periods must be pleaded. Ms Wang did not advance any such proposition.

88    For these reasons, Creation’s cross claim must succeed.

Disposition

89    Ms Wang’s originating application must be dismissed. Orders will be made substantially in the terms sought in Creation’s cross claim. No reason has been suggested why costs should not follow the event.

Associate:

Dated:    27 February 2026