BUILDING DEFECTS: CAN A BODY CORPORATE BRING A CLASS ACTION ON BEHALF OF LOT OWNERS?

On 27 January 2026, the Brisbane Supreme Court delivered its decision in Body Corporate for Westmark Milton CTS v Devine Constructions Pty Ltd [2026] QSC 9. The decision was that:

1. on establishment of a community titles scheme, the contractual rights of the original owner under any contract for building work on scheme land are transferred to the body corporate and lot owners;
2. the body corporate acquires those rights to the extent the contract applies to work affecting common property; lot owners acquire those rights to the extent the contract applies to work affecting their lot;
3. the body corporate is entitled to bring and continue a claim against the builder for breach of that contract in its own name and without joining the original owner – but only to the extent the contract applies to work affecting common property.

Lot owners are left on their own to pursue their claims against the builder to the extent the builder’s breach of contract damaged their lot.

Or are they?

A class action can be started if 7 or more persons have claims against the same person arising out of related circumstances where the claims give rise to a substantial common issue of law or fact. A class action may be started by 1 person on behalf of the other 6 or more persons with common claims.

A body corporate’s claim against a builder for damages for breach of their contract with the original owner has a lot in common with a lot owner’s claim against that builder – both claims arise under the same contract.

This means a body corporate can start a class action against a builder if there was a contract between the original owner of the land and the builder, and the builder’s defective building work has damaged common property and at least 6 lots.

There are advantages to proceeding this way. Firstly, class actions are always case-managed by a Supreme Court Justice. Case-management can make litigation more efficient. Secondly, as a matter of general practice, class actions are referred to mediation at the appropriate time. Mediation can be a very cost-effective tool for resolving litigation.

A special resolution must pass at a general meeting of a body corporate before litigation can be started. However, individual consent of lot owners is not required to start a class action on their behalf. The body corporate can start the class action in its own name and simply describe the lot owners with common claims. As the litigation progresses, lot owners will be given the chance to opt out of the class action.

It is important to understand that there are strict timeframes for dealing with building defects, and delays can extinguish rights the body corporate and lot owners might have had. See Guide for Managing Body Corporate Building Defects.

Article Contributed by Todd Garsden, Partner and James Morgan, Partner of Mahoneys Lawyers & Advisors.

Feel free to contact our dedicated body corporate team if you want to know whether you can use a class action to pursue a claim against the builder for defective building work in the scheme and lots within a scheme.