When is a co-defendant a 'concurrent wrongdoer'? Proportionate liability survives strike-out in BlueCross v Buxton Constructions

When a newly built aged care facility is alleged to be defective and both the builder and the architect are blamed, who bears the cost of putting it right? Can one of them limit its own exposure by pointing to the other?

In BlueCross Community Care Services Group Pty Ltd v Buxton Constructions (Vic) Pty Ltd & Anor [2026] VSC 581 (BlueCross v Buxton), Associate Justice Goulden of the Supreme Court of Victoria refused to strike out the architect’s proportionate liability defence under Part IVAA of the Wrongs Act 1958 (Vic) (Wrongs Act), holding that whether a co-defendant against whom only contractual claims are pleaded can constitute a ‘concurrent wrongdoer’ under the Wrongs Act remains an open question for trial.[1]

Factual background

The dispute arose from the construction of an aged care facility in Box Hill. The owner, BlueCross Community Care Services Group Pty Ltd (BlueCross), sued both its builder, Buxton Constructions (Vic) Pty Ltd (Buxton), and its architect, Billard Leece Partnership Pty Ltd (BLP), seeking to recover the costs of rectifying alleged defects in the construction of the facility.[2]

A central feature of the pleadings was how BlueCross framed its claims against each defendant. BlueCross’s claims against Buxton were framed exclusively in contract, with no allegation of there being a failure to take reasonable care.[3] In contrast, its claims against BLP were framed both in contract and in negligence, making them capable of constituting ‘apportionable claims’ under Part IVAA of the Wrongs Act. BLP contended in its written submissions that the contractual claims against Buxton do in fact involve an alleged failure by Buxton to exercise reasonable care, but was prepared, for the purposes of the application, to proceed on the assumption that no apportionable claim was pleaded against Buxton.[4]

In its defence, BLP pleaded a proportionate liability defence. That is, BLP pleaded that if it were found liable, the claim against it was an apportionable claim to which Part IVAA applied, and that Buxton was a ‘concurrent wrongdoer’ within the meaning of s 24AH, due to Buxton’s acts or omissions causing the same loss and damage.[5] BLP therefore contended its liability should be limited to a just proportion of that loss, having regard to Buxton’s comparative responsibility for the loss.[6]

BlueCross applied to strike out those paragraphs under rule 23.02(a) of the Supreme Court (General Civil Procedure) Rules 2025 (Vic), on the basis they ‘do not disclose a defence’.[7] In its reply, BlueCross conceded that some claims against BLP were apportionable, but denied Buxton qualified as a ‘concurrent wrongdoer’. BlueCross’s argument rested on its construction of s 24AH, to the effect that each putative concurrent wrongdoer must itself be the subject of a claim arising from a pleaded failure to take reasonable care.[8] The Court noted that Buxton, which did not appear at the hearing, appeared from ASIC records to have recently entered liquidation. It was observed by Her Honour, Associate Justice Goulden that this ‘might reflect the timing of the application’, noting BLP’s defence had stood unchallenged since March 2023.[9]

Key issues before the Court

The application raised three interconnected issues:

• First, whether the Court must strike out a defence once it concludes, as a matter of statutory construction, that the defence is unavailable (as BlueCross argued, relying on NSW authority), or whether the Victorian approach applies, under which a defence will survive unless it is futile, so that an arguable construction is enough.[10]
• Second, whether a person can only be a ‘concurrent wrongdoer’ if an apportionable claim (a claim for failure to take reasonable care) is itself pleaded against them, or whether the sole inquiry is whether that person’s acts or omissions caused the same loss.[11]
• Third, whether the availability of the Part IVAA defence is fixed by the pleadings alone or may depend on findings made at trial.[12]

The Court’s decision

Her Honour dismissed BlueCross’s application to strike out paragraphs 41 to 43 of BLP’s defence and indicated that she would hear further from the parties on the issue of costs.[13]

Holding that the hurdle for BlueCross is a high one which requires a very clear case,[14] and because the application raised debatable issues of statutory construction concerning Part IVAA of the Wrongs Act, Her Honour concluded ‘it is inappropriate to strike out BLP’s defence at this interlocutory stage of the proceeding’.[15]

The Court’s reasoning

The strike-out threshold

Goulden AsJ confirmed that the test for strike-out under rule 23.02(a) is ‘broadly similar to the test for summary judgment’ and applies equally to a defence: BlueCross had to show that BLP’s defence was futile, in the sense of being ‘fanciful’ or having no real prospect of success.[16] ‘The hurdle for BlueCross is a high one; there must be a very clear case’, and contentious or debatable points of law are usually inappropriate to determine on a strike-out application.[17]

Relying on the NSW Court of Appeal’s decision in The Owners – Strata Plan No 84674 v Pafburn Pty Ltd (2023) 113 NSWLR 105, BlueCross argued that a defence unavailable at law must be struck out. Goulden AsJ did not need to decide whether that approach applies in Victoria, because she was ‘not so persuaded’ that BLP’s pleading failed to disclose a defence in the first place.[18]

Construction of ‘concurrent wrongdoer’ under s 24AH

The central substantive question was whether a person can be a ‘concurrent wrongdoer’ under s 24AH even if no apportionable claim is made against that person.[19] BlueCross submitted that its claims against Buxton were for ‘breach of contractual warranties and indemnities and do not arise out of any alleged failure by Buxton to take reasonable care’, and therefore Buxton was not a concurrent wrongdoer.[20] On this basis, BlueCross argued BLP’s proportionate liability defence was ‘futile and must be struck out’.[21] On the construction of s 24AH, BlueCross, relied in part on LM Investment Management Limited (in liq) v BMT & Assoc Pty Ltd [2015] NSWSC 1902 (LM Investment), in which Ball J held that each concurrent wrongdoer must be a person against whom a claim for economic loss arising from a failure to take reasonable care is or could be made, reasoning the NSW Court of Appeal has since implicitly endorsed.[22] However, Justice Ball himself acknowledged that ‘the legislation is not entirely clear’, and Goulden AsJ found that, while LM Investment strongly supported BlueCross, its conclusions were ‘not free from doubt’.[23]

On the other hand, BLP relied principally on the High Court’s decision in Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613, which considered NSW provisions defining ‘concurrent wrongdoer’ in identical terms to s 24AH.[24] There, the majority observed that there is ‘no express limitation on the nature of the claim which might have been brought by the plaintiff against a concurrent wrongdoer, except the requirement of s 34(2) that the acts or omissions of all wrongdoers have caused the damage in question’.[25] The High Court apportioned liability against parties who had engaged in fraud, involving causes of action not based on a failure to take reasonable care without stating that the claims against those concurrent wrongdoers were, or needed to be, apportionable claims.[26]

Noting that the Victorian Supreme Court had previously taken the opposite approach (albeit without explicitly considering the question),[27] Her Honour concluded that there is ‘uncertainty within the authorities’ on the point and that, ‘[i]n the absence of very clear authority to the contrary, BLP’s construction is arguable, and its defence is not futile’.[28]

Pleadings alone or findings at trial

The third issue was whether the availability of a Part IVAA defence is determined by the pleadings alone or can be informed by factual findings at trial.[29] Her Honour noted that this issue did not strictly need deciding but addressed it in case she was wrong on the second issue, namely the construction of s 24AH.[30] The authorities generally hold that whether a claim is apportionable will ultimately depend on findings made at trial, although they differ on the weight given to the pleadings.[31]

BlueCross argued that the Victorian Court of Appeal’s decision in Tanah Merah Vic Pty Ltd v Owners Corporation No 1 of PS613436 (2021) 75 VR 1 (Tanah Merah) had resolved the question in favour of the pleadings, which had described the terms in which a claim is framed as ‘an essential determinant’ of whether it is apportionable.[32] Goulden AsJ observed that ‘BlueCross’s position is too absolute’: the Court of Appeal had described the pleading as a ‘starting point’, and its language ‘does not appear to preclude a role for the factual findings made at trial’.[33] Her Honour further observed that the NSW Court of Appeal had since expressed reservations about the Tanah Merah formulation.[34]

Her Honour held ‘it is not my role on this strike out application to reconcile these various authorities, it is enough to expose the debate’.[35] Given the prospect that findings at trial would play a role, she was ‘fortified in my view that it is inappropriate to strike out BLP’s defence at this interlocutory stage of the proceeding’.[36]

Key takeaways

• The scope of who may constitute a ‘concurrent wrongdoer’ for the purposes of Part IVAA remains unsettled. Whether a party must itself face a pleaded negligence-type (apportionable) claim before it can be considered a concurrent wrongdoer remains an open question in Victoria, with competing High Court and NSW authority and an acknowledged lack of statutory clarity.[37] Until the Victorian Court of Appeal or the High Court resolves the point, consultants, contractors and their insurers should expect proportionate liability defences naming co-defendants sued only in contract to advance to trial in Victorian proceedings, with apportionment considerations presumably to be undertaken after findings of fact are made in relation to the conduct of the defendant, rather than disposed of early.[38]
• Pleadings may not be determinative. Whether proportionate liability turns on the pleadings alone or on findings at trial is also an unresolved question in Victoria, although the Court’s observations on this point were not strictly necessary to its decision.[39] For claims managers and brokers, the way an owner frames its claim will be an important, but not necessarily final, indicator of how liability may ultimately be shared.[40]
• Plaintiffs who confine claims against a builder to contract (for example, where the builder is insolvent) to limit the ability of the solvent (insured) consultants to apportion liability to the insolvent builder, cannot assume that strategy will succeed at an interlocutory stage.[41]
• The significant uncertainty in relation to the availability of apportionment defences needs to be resolved to provide clarity for all parties to Victorian building disputes, and for insurers.

[1] BlueCross Community Care Services Group Pty Ltd v Buxton Constructions (Vic) Pty Ltd & Anor [2026] VSC 581 at [11], [19], [26], [33].

[2] Ibid at [1].

[3] Ibid at [5], [21].

[4]  Ibid at [5], [30].

[5] Ibid at [6].

[6] Ibid.

[7] Ibid at [3].

[8] Ibid at [7].

[9]  Ibid at [1]–[2], [4].

[10] Ibid at [13]–[16].

[11] Ibid at [19].

[12] Ibid at [27].

[13]  Ibid at [11], [34]–[35].

[14] Ibid at [16].

[15] Ibid at [33].

[16] Ibid at [15].

[17]  Ibid at [16].

[18]  Ibid at [13]–[14].

[19] Ibid at [19].

[20] Ibid at [21].

[21] Ibid at [9].

[22] Ibid at [24(b)], citing Zervas v Burkitt [No 2] [2019] NSWCA 236.

[23] Ibid at [26].

[24] Ibid at [22].

[25] Ibid at [23], [24(a)].

[26] Ibid.

[27] Ibid at [25]–[26], citing Trani & Anor v Trani [No 2] (2019) 59 VR 362.

[28] Ibid.

[29] Ibid at [27].

[30] Ibid.

[31]  Ibid at [28]–[29].

[32] Ibid at [30].

[33] Ibid at [32].

[34] Ibid at [31], citing Gerrard Toltz Pty Ltd v City Garden Australia Pty Ltd (in liq) [No 2] [2024] NSWCA 232.

[35] Ibid at [33].

[36] Ibid.

[37] Ibid at [26].

[38]  Ibid at [19], [24(b)], [26].

[39]  Ibid at [27]–[30].

[40]  Ibid at [32]–[33].

[41]  Ibid at [19], [30].