Does the Limitation of Actions Act Apply to Claims Under the Water Act?

If you have encountered water flow onto your property causing damage, injury or economic loss, then you may be considering pursuing a claim in the Victorian Civil and Administrative Tribunal (VCAT). However, it is unclear currently whether there are time limitations on raising a claim.

Urban Liability arising from the Water Act

The Water Act 1989 (Vic) (Water Act) imposes liability on an owner where water flows onto an adjoining land and causes injury, damage to property or economic losses.

The decision in Steedman v Greater Western Water Corporation [2023] VCAT 128 (Steedman) provides that claims under the Water Act, do not enliven s 51 the Limitation of Actions Act 1958 (Vic) (Limitation Act), which provides that claim must be commenced within 6 years.

Steedman – Does the Limitation Act apply to the claim?

In Steedman, a homeowner sought compensation from Greater Western Water (GWW) after a flow of water from their sewerage infrastructure caused damage to the homeowner’s property. GWW denied liability, arguing that the Limitation Act prevented an individual from raising a claim after a 6-year period. VCAT was called on to determine whether the cause of action under the Water Act was indeed answerable to a six-year limitation period.

To determine if the Act was statute barred, VCAT considered two recent decisions in the Supreme Court of Victoria; Lanigan v Circus Oz & Ors [2022] VSC 35  (Lanigan) and Ajaimi v Giswick Pty Ltd [2022] VSC 131 (Ajaimi). In those decisions, the Supreme Court investigated the applicability of the Limitations Act in VCAT proceedings generally. The resulting decisions of Lanigan and Ajaimi are conflicting:

Lanigan: It was held that a statutory claim for compensation does not enliven the six-year limitation period per the Limitation Act because VCAT is a tribunal rather than a court and therefore does not meet the definition of ‘action’ in the Act.

Ajaimi: In contrast to Lanigan, the decision provided that the definition of ‘action’ in the Limitation Act was inclusive and was not limited by the fact that VCAT is a tribunal.  The Limitations Act therefore applies to proceedings in VCAT too.

In Steedman, VCAT upheld the decision in Lanigan. Accordingly, Steedman was entitled to seek compensation from GWW because the Water Act was not subject to the Limitations Act; there was no statutory time bar against pursuing a claim here.

To learn more about any of the decisions discussed here, or if you require legal assistance, please contact Chris Moshidis, Director and Principal Lawyer on +61 9521 7956 or chris@urbanlawyers.com.au.