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  • Unreported Judgment

Fowler v The Society for the Mount Isa Garden Settlement

 

[2016] QCAT 64

CITATION:

Fowler v The Society for the Mount Isa Garden Settlement [2016] QCAT 64

PARTIES:

Keith Fowler t/as Beach Haven Landscapes

(Applicant)

 

v

 

The Society for the Mount Isa Garden Settlement t/as The Laura Johnson Home

(Respondent)

APPLICATION NUMBER:

BDL056 - 15

MATTER TYPE:

Building matter

HEARING DATE:

24 March 2016

HEARD AT:

Brisbane

DECISION OF:

Member Traves

DELIVERED ON:

3 May 2016

DELIVERED AT:

Brisbane

ORDERS MADE:

  1. The respondent pay the applicant $31 017.60 by 31 May 2016.
  2. The respondent pay the applicant’s costs fixed at $710.00 by 31 May 2016.

CATCHWORDS:

BUILDING MATTER – claim for work done by contractor – claim for damages by contractor where site not ready – amount of damages.

Queensland Building and Construction Commission Act 1991 (Qld), s 75(1), s 77(1), s 77(3)(h), Schedule 2.

Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64

Empirnal Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523

Hungerfords v Walker (1989) 171 CLR 125

Integrated Computer Services Pty Ltd v Digital Equipment Corporation (Australia) Pty Ltd (1988) BPR 97326

Pavey v Matthews (1986-1987) 162 CLR 221

Tabcorp Holdings Ltd v Bowen Investments Pty Ltd (2009) 236 CLR 272

REASONS FOR DECISION

Introduction

  1. [1]
    This is a claim by Keith Fowler trading as BeachHaven Landscapes (BL) for $41 310.37 for damages comprising wages, costs and interest.
  2. [2]
    BL agreed with The Society for the Mount Isa Memorial Garden Settlement trading as The Laura Johnson Home (LJH), the respondent, to do landscaping works at premises owned by LJH.
  3. [3]
    BL claims the site was not ready for BL to perform the work at the agreed time. Consequently, BL says, its commencement and completion of the work was delayed, causing it loss.
  4. [4]
    BL was paid the agreed contract price of $170 203.00 by LJH.
  5. [5]
    The claim concerns the period between 18 August 2014 and 28 September 2014 which represents the time BL was not doing its work (as defined in the contract) or rectification work which it was subsequently engaged to do.
  6. [6]
    BL argued that it was entitled to $41 310.37 on a number of alternative bases: that “delay damages” are recoverable under the contract, that LJH agreed after entry into the contract to pay its delay costs, and, that LJH are in breach of contract and the claim represents the damages caused to BL by the breach.

Background

  1. [7]
    BL entered into a contract with LJH on 29 April 2014 to complete landscaping works to an aged care facility in Mt Isa. The premises were and are owned by LJH.
  2. [8]
    The form of contract entered into was a Standard HIA Small Works contract. This contract was designed to apply to domestic building works and does not arguably apply to the work to be done by BL for LJH at the aged care facility. However, although the terms are not ideally suited for the work carried out, both parties agreed to them.
  3. [9]
    The commencement date was 25 May 2014 (clause 4). The building period was 60 days after commencement (clause 5).
  4. [10]
    Work commenced on 29 May 2014 and, if all had gone to plan, would have been completed on 27 July 2014. Instead the work under the contract was completed on 3 December 2014, over 4 months later.
  5. [11]
    I find, on the evidence before me, that the reason the landscaping works were delayed was due to previous work done on the site by another contractor, Penfolds Projects. The work done by Penfolds Projects did not comply with relevant specifications and, ultimately, had to be rectified. Major issues included that the irrigation system installed did not use PN 12.5 poly pipe and the garden soil and mulch were not of sufficient grade or quality and had not been applied to sufficient depth.
  6. [12]
    These issues were discovered by BL on 7 July 2014 when it began raking back the mulch with a view to planting the 3, 500 plants it had delivered and agreed to plant. LJH requested BL commence rectification work, to remedy the problems which had been identified, which BL did.
  7. [13]
    BL continued to do rectification work for which it was paid until 18 August 2014 when it was directed by LJH to stop work. LJH wanted Badge Constructions, the principal contractor, to complete the rectification works in accordance with a show cause notice sent on 8 August 2014.
  8. [14]
    The claim for $41 310.37 is expressed to be for ‘delay costs’ incurred by BL in respect of the period 19 August 2014 to 28 September 2014.
  9. [15]
    On 19 August 2014 the applicant took a break but returned to the site on 26 August 2014.
  10. [16]
    At a meeting on 28 August 2014 between representatives of LJH, Badge Constructions, Penfolds Projects and BL it was resolved that BL would cease work and that Penfolds Projects would have some areas ready by 3 September 2014 to enable BL to start its work.  All work by Penfolds Projects was to be completed by 13 September. In this case BL should have been able to complete its work by 15 September 2014.
  11. [17]
    On 1 September BL was told that Penfolds Projects would not finish by 3 September.
  12. [18]
    In an email of 5 September 2014 Coffey Australia, engaged as Project Directors by LJH, by its superintendent Mr Brian Chambers, said “It is my expectation that a further delay claim will be sent to Badge which will cover period from 19 August until such time as planting can begin”.
  13. [19]
    On 9 September BL sent an email to LJH referring to delays and stating that BL will be claiming actual costs and wages in relation to the delays. A delay claim dated 28 September 2014 was sent and subsequently added to by a further claim dated 8 October 2014. The issue is whether this claim which totals $41 310.37 is payable by LJH to BL.

What is the claim for?

  1. [20]
    The claim comprises two invoices.
  2. [21]
    The first invoice dated 28 September 2014 covers the period from 27 August to 28 September 2014. It includes a claim for wages paid to Keith every day Monday to Friday for 7 hours a day, Saturday for 5 hours and Sunday for 4 hours at a rate of $59 an hour. The total hours claimed are 206 which at that rate amounts to a claim for $12,154. The work was described as follows: ‘On site everyday, work included but was not limited to maintaining Turf areas, Trees stored, and main planting storage, also interacting with Penfolds on request.
  3. [22]
    The claim also included wages for Josh Fowler who had returned to Brisbane. The claim was made on the basis that Josh was kept “on hold” and therefore paid a wage, albeit at reduced rates. The amount claimed was for a 38 hour week at a rate of $39 an hour for 174.8 hours which amounted to $6 817.20.
  4. [23]
    The claim also included am amount for accommodation at $199 per day for 33 days which amounted to $6 567.00. A ‘margin’ of 20% was also claimed pursuant to clause 9 which amounted to $5 107.60.
  5. [24]
    The second invoice dated 8 October 2015 was for an earlier period, 19 August to 26 August 2014.This claim was again for both employees, Keith and Joshua at the rates listed above for 6 days, or 45.6 hours each. The total wages claimed were, for Keith $2 690 and for Joshua $1 778.40. The claim also included the cost of Joshua’s return flights to enable him to go home until required back on site ($1140).

Jurisdiction of the Tribunal

  1. [25]
    Under s 77(1) of the Queensland Building and Construction Commission Act 1991 (Qld) (QBCC Act), a person involved in a building dispute may apply to QCAT to have the tribunal decide the dispute. Building dispute includes a domestic building dispute or a minor commercial building dispute.[1]  A ‘minor commercial building dispute’ means a commercial building dispute where neither the claim nor the counterclaim exceeds $50,000.[2]
  2. [26]
    Commercial building dispute includes a claim or dispute arising between a building owner and a building contractor relating to the performance of reviewable commercial work or a contract for the performance of reviewable commercial work.[3] Reviewable commercial work means tribunal work other than reviewable domestic work.[4]
  3. [27]
    Tribunal work includes, relevantly:

any site work (including the construction of retaining structures, driveways, landscaping and the construction of a swimming pool) related to tribunal work of a kind mentioned in paragraphs (a) to (d).[5]

  1. [28]
    Here the work to be performed by BL was to landscape the site owned by LJH relating to the renovation or improvement of a commercial building.[6] It is tribunal work and a minor commercial dispute and is therefore within its jurisdiction. 

Is BL entitled to the amount claimed 

  1. [29]
    In the present circumstances, had the site been ready for performance of the work required by BL, the work would have been completed by 27 July 2014. Instead, it was completed on 3 December 2014. The claim by BL is that, had the site been ready, it would not have incurred the ‘delay costs’.
  2. [30]
    Clause 5 provides:

DELAYS

The contractor is not responsible for any delay caused by something beyond the contractor’s sole control including any failure by the owner to:

  1. (a)
    Make a selection; or
  2. (b)
    Give the contractor adequate access to carry out the works.

The building period will be extended by whatever time is reasonable if the contractor claims an extension of time by giving the owner written notice.

  1. [31]
    Clause 5 concerns circumstances where the completion of the work by the contractor is delayed by something beyond the contractor’s control. It provides for an extension of time for the contractor to complete the work.
  2. [32]
    Accordingly, it is not relevant to the present claims.
  3. [33]
    Clause 8, dealing with variations, provides:

VARIATIONS

If the owner requests a variation, the contractor will give the owner a written quote detailing the work, the price, when the price is to be paid, the estimated time to do it and the likely delay, if any.

If the contractor requests a variation the contractor will also state the reason for the variation.

If the owner agrees to the variation by signing the quote and returning the signed quote to the contractor, the contractor will then do the variation in the time agreed.

The contractor can require payment for a variation as soon as the variation work is started.

  1. [34]
    The further work done by Keith constituted, on one view, work done pursuant to an agreement to be inferred from the conduct of the parties, and in that sense might be regarded as a variation of the principal contract. However, the process contemplated by the variation clause was not engaged, and accordingly the clause did not relevantly take effect.
  2. [35]
    Although the contract does not expressly provide for a delay claim, amounts claimed due to a delay caused by another contractor may nonetheless be recoverable.

The claim for wages for Keith for the period 19 August 20114 to 26 August 2104 and for 27 August 2014 to 28 September 2014

  1. [36]
    BL claims $2 690 for Keith for the period 19 August to 26 August 2014, being a claim for 45.6 hours at $59 per hour. The evidence is that Keith was not on-site during this period, but that he had “taken a break”.
  2. [37]
    BL also claims the sum of $12 154 in respect of “wages” for Keith during the period 27 August 2014 to 28 September 2014, calculated at $59 per hour for 206 hours work. The work is described as work onsite, including but not limited to maintain turf areas, trees stored, main planting storage and interacting with Penfolds on request.
  3. [38]
    There are, in my view, at least two bases in which the latter sum claimed is recoverable.
  4. [39]
    First, it is arguable that there was, in respect of the work, an implied contract, by which BL and LJH are taken, by their conduct, to have agreed that BL would do the work particularised and that BL would, in the absence of an express agreement, be paid a reasonable sum for the work. A contract may be inferred from the acts and conduct of parties.[7] Here, BL did the work, and LJH accepted its benefit.
  5. [40]
    Secondly, in the absence of an implied contract, there lies a claim in quantum meruit for a reasonable sum for work done by BL the benefit of which has been accepted by LJH.[8] 
  6. [41]
    I find that the work was done and that the sum of $59 per hour is a reasonable rate of remuneration.
  7. [42]
    I will allow BL’s claim in respect of Keith’s wages for the period 27 August to 28 September 2014.
  8. [43]
    The claim for the earlier period is not in the nature of a claim for work done. Rather, it is in the nature of a damages claim, effectively being a claim for earnings which would have been earned elsewhere had it not been for the fact that the site was not ready. Whether or not this sum is claimable therefore depends on whether I am satisfied that Keith would have earned the sum claimed elsewhere, had he not been waiting for the site to become available. There was no evidence that this was the case.
  9. [44]
    On the evidence, Keith during this week long period took leave. It would have been necessary for Keith to take leave at some stage. I am therefore not satisfied on the evidence that BL suffered loss in respect of Keith’s wages in the period 19 August to 26 August 2014.

The claim for wages for Josh Fowler in the invoice of 28 September 2014

  1. [45]
    There are two claims made for Josh’s wages: a claim for $1,178.40 for the period 19 August to 26 August 2014; and a claim for the sum of $6,817.20 for the period 27 August to 28 September 2014. The wage claim is calculated at the rate of $39 per hour for 174.8 hours.
  2. [46]
    Josh had returned to Brisbane, but it is said that he was ‘kept on hold’ and therefore paid wages albeit at a reduced rate and for a reduced 38 hour week. Josh could not be gainfully employed on other work for BL because of the absence of Keith in Mt Isa and because Josh was, effectively, ‘on hold’ awaiting the resumption of work in Mt Isa. 
  3. [47]
    BL was directed to stop work on 18 August 2014. The timing of further performance of the work remained uncertain until 28 August 2014, when at the meeting of LJH, Badge Constructions, BL and Penfolds Projects it was resolved that the site would be ready for BL on 3 September 2014. On 1 September Penfolds Projects advised that the site would not be ready on 3 September. The time at which the site would be ready remained uncertain.
  4. [48]
    Unlike the claim in respect of Keith’s work on the site, the claim in respect of Josh does not consist of work done for or at the request of LJH. Rather, it is a claim for damages for breach of the contract, the breach being the failure to have the site ready for the work on the agreed date.
  5. [49]
    A plaintiff is entitled, by way of damages, to receive full compensation for the loss sustained as a result of the defendant’s breach, subject to the law relating to remoteness of damage and the duty of the plaintiff to mitigate his or her loss.[9]  The measure of damages for breach of contract is assessed on the principle that the injured party is, so far as money can do it, to be placed in the same position he or she would have been in had the contract been performed.[10] Thus, the exercise is one of comparing the position the innocent party would have been in had the contract been performed, with the position in which that party, in fact, finds itself.  The claimant has the onus of establishing the hypothetical position in which he would have been had the promise been performed.[11]
  6. [50]
    In my opinion, the effect of the site not being ready has been that BL were required to continue to pay Josh while the site was readied for BL to recommence its work. I accept the evidence of BL that Josh was in fact paid wages for this period.
  7. [51]
    BL was required to mitigate its loss, but in circumstances where the time at which BL would be required to resume work remained either promised, although unfulfilled, or uncertain, BL did not in my view breach that obligation.
  8. [52]
    I will allow the claim for wages for Josh for both periods, in the sum total of  $8 595.60.

The claim for accommodation for thirty three days from 27 August to 28 September 2014

  1. [53]
    BL claims the sum of $199 per day for a period of 33 days being the value of accommodation for Keith while he waited for the site to become ready, a sum of $6 567. I note that during this period Keith was also performing the work noted above.
  2. [54]
    The cost claimed does not represent the actual cost of accommodation incurred by BL in respect of Keith. In fact, Keith stayed at a private home and worked for the owner during the period for which the claim is made, to the value of the accommodation. That is work for which he would otherwise have been remunerated.
  3. [55]
    I find that the sum of $199 per day is reasonable.
  4. [56]
    Accordingly, I will allow the claim in the sum of $6 567.

The claim for the sum of $5 107.60 being a ‘margin’ of 20% under clause 9 of the contract.

  1. [57]
    Clause 9 of the contract provides:

UNFORSEEN CIRCUMSTANCES

The contractor is not responsible for any problems with the site which are only revealed when carrying out the works.

The contractor will carry out any work needed to fix any such problem, if the contractor considers it necessary for the satisfactory completion of the works.

Any additional work necessary due to an unforeseen circumstance is a variation and clause 8 applies. If a price is not agreed the owner will be charged the actual cost to carry out the work plus another 20%.

  1. [58]
    Clause 9 concerns “unforeseen circumstances”. The items the subject of the claim do not, however, in my view, consist of work needed to fix problems with the site which were only revealed by the carrying out of the works. The claim for work done relates to, in brief, the maintenance of the turf and the plants. This is not a claim for work needed to fix the problem on the site.
  2. [59]
    Accordingly, I will not allow the claim.

The claim for Josh’s airfares

  1. [60]
    BL claims the sum of $1 140 for a return flight for Josh to Brisbane.
  2. [61]
    Had the site been ready at the agreed time, this cost would not have been incurred. Had Josh not returned to Brisbane BL would have incurred further accommodation costs.
  3. [62]
    Accordingly, I will allow the claim as damages for breach of contract.

Conclusion

  1. [63]
    The amounts comprising the claim made by BL in respect of the period from 19 August to 28 September 2014 were caused by continuing delays to the commencement of the landscaping works by BL. The delays were not caused by any fault on the part of BL. Although the delays were caused by another contractor, the owner, LJH, is ultimately responsible to BL for the delays caused by the site not being ready at the designated time.
  2. [64]
    I will allow the following:
    1. (a)
      Keith’s wages from 27/08/14 to 28/09/14  $12 154.00
    2. (b)
      Keith’s accommodation    $6 567.00
    3. (c)
      Josh’s wages from 19/08/14 to 28/09/14  $8 595.60
    4. (d)
      Josh’s airfares     $1 140.00
  3. [65]
    BL has claimed interest. I do not propose to allow interest at the rate claimed because the amounts awarded are not amounts due and owing under the contract, but rather constitute damages or an amount in respect of other work requested and done. I will allow interest at 6% over 18 months, a total of $2 561.
  4. [66]
    The Tribunal has power under s 77(3)(h) of the Queensland Building Construction Commission Act 1991 (Qld) to award costs. It has been necessary for BL to bring these proceedings in order to recover the sum awarded. BL has been largely, although not entirely, successful in its claim. LJH was successful in respect of some issues. In the circumstances I will allow BL two thirds of the costs claimed in the sum of $710.00.
  5. [67]
    I give judgment for BL in the sum of $31 017.60. Further, I order that LJH pay the costs of BL fixed at the sum of $710.00.

Footnotes

[1] Queensland Building and Construction Commission Act 1991 (Qld), Schedule 2.

[2] Queensland Building and Construction Commission Act 1991 (Qld), Schedule 2.

[3] Queensland Building and Construction Commission Act 1991 (Qld), Schedule 2.

[4] Queensland Building and Construction Commission Act 1991 (Qld), Schedule 2.

[5] Queensland Building and Construction Commission Act 1991 (Qld), s 75(1)(e).

[6] Queensland Building and Construction Commission Act 1991 (Qld), s 75(1)(b).

[7] Integrated Computer Services Pty Ltd v Digital Equipment Corporation (Australia) Pty Ltd (1988) BPR 97326 at 11; Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523.

[8] Pavey v Matthews (1986-1987) 162 CLR 221 at 227.   

[9] Hungerfords v Walker (1989) 171 CLR 125 at 143 per Mason CJ and Wilson J.

[10] Tabcorp Holdings Ltd v Bowen Investments Pty Ltd (2009) 236 CLR 272 at [13].

[11] Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64 at 80.

Close

Editorial Notes

  • Published Case Name:

    Keith Fowler t/as Beach Haven Landscapes v The Society for the Mount Isa Garden Settlement t/as The Laura Johnson Home

  • Shortened Case Name:

    Fowler v The Society for the Mount Isa Garden Settlement

  • MNC:

    [2016] QCAT 64

  • Court:

    QCAT

  • Judge(s):

    Member Traves

  • Date:

    03 May 2016

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.
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