Issues with a Builders Bill

Hello,

My friend built a house in WA over 3 years ago and the builder didn't finish the house properly. Lucky my friend withheld some of the last payment until the house was finished (this is after handover). After 6 months and numerous, calls, emails and promises from the builder he gave up and advised the builder he wasnt getting money and not to worry about the remaining items. No response from the builder after this.
A few weeks ago he gets another bill from the builder claiming the money is still due.
As a note the amount of money would exceed the value of the items (although he paid for a finished house and didn't get it).
Their was also the inconvenience of living in an incomplete house for 8 months.

I would assume after three years of non contact and no denial of my friends undisputed assertion that he would keep the outstanding money in exchange for rectifying the remaining items this would be considered acceptance by the builder. Is their a time limit on such things as such a long time would certainly seem like implied agreence to me?

What would be a prudent course of action for him to pursue with the builder?

Any input would be welcomed :)

Smallbuyer
 
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