By Jesinta Burton and Sarah Brookes
Three BGC Housing Group entities are at the centre of a $100 million class action being spearheaded on behalf of thousands of frustrated homeowners who entered building contracts with the trouble-plagued construction giant.
In a statement on Thursday, Perth law firm Morgan Alteruthemeyer Legal Group confirmed that on Wednesday it had commenced Supreme Court proceedings, the first of their kind, against one of Western Australia’s largest builders.
Zoe-Marie and Joel Masters with their children Temperance (12), Max (10), Grace (4) and Lilly (2) outside their unfinished home in Mandogalup.Credit: Ross Swanborough
In it, the complainants claim BGC Residential, J-Corp and Ventura Homes breached Australian Consumer Law and their contractual obligations with individual BGC homeowners in contracts entered into between January 2019 and September 2022.
Morgan Alteruthemeyer Legal Group building and construction partner Spencer Lieberfreund said the organisation had undertaken a significant amount of work getting to get the claim underway for those seeking compensation over lengthy build delays and hefty cost blow outs.
WAToday can reveal the quantum of the compensation claim is in the order of $100 million, with as many as 5000 customers believed to be affected.
BGC customer-turned-plaintiff James Buck alleged BGC’s conduct had left him and his family both financially and emotionally devastated.
Zoe-marie Masters and her husband Joel signed a preliminary works agreement with Commodore Homes, owned by BGC, in December 2020.
The family did not move into their new home in Mandogalup’s Apsley Estate until October 2023.
Zoe said it was a relief for thousands of BGC customers that the class action had started.
“This is the day we’ve been dreaming of ever since the idea was conceived,” she said.
“It seems like no one has the power to hold BGC accountable for what they have done to so many people building a home.”
Zoe said she was paying in excess of $5000 a month on rent and interest payments on her new build as well as around $7000 in cash payments to entice tradies to finish the house quicker.
BGC has vowed to vigorously defend any legal action, pinning the issues plaguing the housing construction industry on the demand for stimulus grants handed out by the state and federal governments during the COVID pandemic.
A spokesman said the basis of the class action case had potential widespread implications for all builders across the state and Australia.
“The company will not let this distract us from our continued focus on delivering all homes as quickly as current labour market constraints allow,” he said.
“Since we ceased taking new home orders in April 2023 we have handed over in excess
1,800 homes.
“Current completion rates are seeing us hand over 40-50 sets of keys per week.”
The lawsuit is being bankrolled by litigation funder Omni Bridgeway, which offered to fund the action in September.
BGC Housing Group, which includes Aussie Living Homes, Homestart, Smart Homes for Living, Now Living, Terrace and Ventura South West, was toppled as WA’s biggest builder in 2023 after putting the brakes on new home builds to tackle its backlog of pandemic-era projects.
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