Kay’s solicitor to Expandify: letter of demand

Kay’s solicitor’s 30 June letter sets out her position on the disputed contract and payments and proposes safeguards for completion.

Kay’s solicitor's 30 June letter setting out Kay's legal position, disputed contract and payment issues, and proposed completion safeguards.

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Kay’s solicitor [solicitor business number redacted] P [address redacted], [solicitor address redacted] T [solicitor phone redacted] E [email redacted] 'Liability limited by a Scheme approved under professional standards legislation'. Our Ref: [case reference 04 redacted] 30 June 2026 Expander Dwellings Pty Ltd t/as Expandify [address redacted], RACEVIEW QLD 4305 By email: [email redacted] Dear Director, RE: KAY POWER -&- EXPANDER DWELLINGS PTY LTD T/AS EXPANDIFY DOMESTIC BUILDING CONTRACT We act for Kay Power. We are instructed that on 11 July 2025 our client entered into a written agreement for you to supply and install an off-site pre-fabricated dwelling (“the Contract”) at [residential address redacted] (“Site”) for the sum of $224,003 (“the Contract Price”). The material terms of the Contract included amongst other things: 1. You were responsible for installing the dwelling, connecting it to services and obtaining Council approval for the installation; 2. Our client was to pay a 30% deposit; 3. the Anticipated Delivery Date was 29 weeks. The following terms are also implied terms of the Contract, by operation of section 19 of Schedule 1B ‘Domestic building contracts’ of the Queensland Building and Construction Commission Act 1991 (“QBCC Act”) that: 4. You, the building contractor, warrants that all materials to be supplied for use in the subject work: (a) will be good and, having regard to the relevant criteria, suitable for the purpose for which they are used; and (b) unless otherwise stated in the contract, will be new. 5. You, the building contractor, warrant that the work will be carried out in accordance with all relevant laws and legal requirements, including, for example, the Building Act 1975; 6. You, the building contractor, warrants that the subject work will be carried out: (c) in an appropriate and skilful way; and (d) with reasonable care and skill. 7. You, the building contractor, warrants that the detached dwelling or home will be suitable for occupation when the work is finished. 8. You, the building contractor, warrants that the subject work will be carried out with reasonable diligence. Our searches indicate that at the time of entering the agreement, you did not hold an appropriate licence under the QBCC Act to carry out building work necessary to install the dwelling. As such you contravened section 42(1) of the QBCC Act.

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Page 2 On or about 8 April 2026, you provided our client a new contract that: a) described the works as “Construction of Prefab modular home as per previous sales agreement” at Item 3 of the Reference Schedule; b) described the deposit as “$67,200.91 (incl. GST) being 10% of Contract Price” at item 2 of the Reference Schedule; c) described the Completion Period as 241 Calendar Days from the starting date of 29 May 2026 at Item 6 of the Reference Schedule (this period was reduced to 97 days on a revised version after our client questioned the length of time required); d) sought to add new general terms and conditions that were fundamentally different from the Contract. Firstly, our client is under no obligation to sign this new contract, nor do you have any legal right to require her to sign the same. You are contractually obligated to carry out and perform the works you agreed to under the Contract on the terms and conditions agreed to at that time. Secondly, the new contract contravenes provisions of the Schedule 1B ‘Domestic building contracts’ of the QBCC Act. In this regard: a) section 33(1)(c) provides that a building contractor must not demand or receive a deposit under a contract of more than 20% of the contract price for contracts under which the value of the off-site work is more than 50% of the contract price. You have sought, demanded and received a deposit valued at 30% of the contract price; b) section 34 provides that a building contract must not claim an amount under the contract unless the amount is: (i) is directly related to the progress of carrying out the subject work at the building site; and (ii) is proportionate to the value of the subject work that relates to the claim, or less than that value. Including the 30% deposit your contract requires our client to pay 90% of the contract price before the pre-fabricated dwelling has been delivered to the Site for installation. We are instructed that our client has paid the sum of $134,401.82 representing the Deposit and 30% progress claim for Build Complete. We are instructed that you now allege that the scope of works excluded the connection of the dwelling to septic tanks. By way of email on 29 June 2026 you have asserted that clause 15.11 of the Contract excludes any works related to the septic tank connection. Prior to this email you had been relying upon an express exclusion contained in an alleged specifications document but in essence admitted in that email the specification document being relied upon did not exist at the time the Contract was entered. Our client’s position is that the Contract did not expressly exclude such works. In fact, the Contract describes the package our client purchased as: “A comprehensive, hassle-free solution for your home or granny flat that includes the dwelling, complying development council approvals, installation and everything in between.” Clause 15.11 provides: “You agree that we are not liable for any issues, delays, costs, unforeseen matters or works in ensuring that the location of installation of the Goods is fit to accommodate the

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Page 3 Goods, including but not limited to underground works, rocks, soil type, unknown or unseen utilities or infrastructure that result in damage or time delays.” (Emphasis added) We are instructed that you inspected the Site to carry out investigations prior to entering into the Contract with our client. Our client paid invoices for your initial investigations and preliminary works: a) Preliminary Site Feasibility Report in the sum of $600 on 6 May 2025; b) BAL Report – Council and Building Certification in the sum of $871.20 on 28 May 2025; c) Site Assessment in the sum of $6,560 on 9 June 2025. It is our client’s position that you were aware of the Septic tank prior to entering the Contract. You also received payment to carry out preliminary works including site assessment and feasibility and obtaining reports as to council and building certification requirements. As such our client vehemently denies that it is liable for any additional fees in relation to any approval required in respect to the connection of the dwelling as you were or ought to have been aware of the costs and approvals required when you entered the Contract with our client. Complaints Our client’s position is that you are in breach of your implied warranty to carry out the works with reasonable diligence. It has been 50 weeks since our client signed the contract and you have failed to deliver the pre- fabricated dwelling to Site for installation. Our client is also of the view that you have engaged in misleading and deceptive conduct in contravention of section 18 of the Australian Consumer Law. This view stems from your conduct: 1. in representing that you could install the dwelling when you failed to hold the appropriate licence under the QBCC Act; 2. in representing that the package included the dwelling, complying with development and council approvals, installation and everything in between, when it is evident from your conduct that it was not your intentions that “everything in between” was included; 3. by seeking from our client further money for the installation of the dwelling including in respect to the connection to services greater than the Contract Price when our client is under no contractual obligation; and 4. by seeking our client enter into the new contract without an appropriate mechanism to end the contract for the same subject matter that was current on foot. The Contract contains Unfair Contract Terms and is in contravention of section 23 of the Australian Consumer Law. Specifically, the Contract contains a clause whereby ownership in the pre-fabricated home is retained by you until the Contract Price is paid in full, notwithstanding that the payment provisions of the Contract require our client to pay 90% of the Contract Price before the pre-fabricated home is even delivered to site and the contract includes the installation by you of that dwelling. Next Steps We are instructed that you have advised that: I. the pre-fabricated dwelling is scheduled to shipped from China on 7 July 2026 with a scheduled ETA of 7 August 2026; II. foundation installation is to commence on 9 July 2026; and III. you require 74 days to complete the installation of the dwelling from 9 July 2026.

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Page 4 In the circumstances, it is our view that the following ought to also be agreed by the parties: 1. that should you fail to reach practical completion by 21 September 2026, our client will be entitled to liquidated damages in the sum of $100 per day until practical completion is reached; 2. that Item Ref 6 ‘Balance Payments’ of Schedule 1 of the Contract be amended to omit the words “30% of Purchase Price upon Arrival in Australia. 10% of Purchase Price upon the Goods being made available to you for occupation.” and replaced with: 10% Foundations Installed 20% Delivery to Site 10% Handover (including the provision of Form 21 Final Inspection Certificate or equivalent certificate under Building Act 1975). 3. Clause 8.2 is omitted and replaced with “Title to the Goods shall pass to you upon payment of the progress claim for “Delivery to Site”. 4. You agree to pay for an Independent QBCC-licensed inspector to carry out an inspection and provide a written report at Practical Completion; 5. The directors of Expander Dwellings Pty Ltd provide statutory declarations that the company: a. is currently able to pay its debts when they fall due; b. is not and has not been trading insolvent; c. as at the date of the declaration, has paid all monies due and payable to any employees, subcontractors and suppliers; and d. has not currently received any actual or threatened disputes in relation to the payment of any moneys due to a subcontractor or supplier. If you are agreeable to our client’s proposed variations we will prepare an appropriate Deed of Variation for the parties to sign. Our client reserves her rights should we fail to receive a substantive response to the matters addressed above within seven (7) days. Yours faithfully Kay’s solicitor Kay’s solicitor Principal