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- Unreported Judgment
 QCAT 194
Dubs Pty Ltd t/as O’Duinns Irish Pub v Queensland Building and Construction Commission  QCAT 194
Dubs Pty Ltd t/as O’Duinns Irish Pub
Queensland Building and Construction Commission
General administrative review matters
18 June 2014 and 11 March 2016
23 June 2016
GENERAL ADMINISTRATIVE REVIEW-RECTIFICATION OF BUILDING WORK-review of decision not to direct rectification of building work-whether builder at fault or defective work attributable to builder-whether it would be unfair in the circumstances to direct builder to rectify work.
Queensland Building and Construction Commission Act (formerly Queensland Building Authority Act) 1991 ss 3, 72(1), 72(2), 72(8) and 72(14).
Queensland Civil and Administrative Tribunal Act 2009 ss 19(a), 19(c), 20 and 24.
Statutory Instruments Act 1992 (Qld) s 7.
Mr Thomas Dunne, Director of Dubs Pty Ltd t/as O’Duinns Irish Pub represented Dubs Pty Ltd t/as O’Duinns Irish Pub
Mr Brendan Szima, in-house lawyer, Queensland Building and Construction Commission represented the Queensland Building and Construction Commission
REASONS FOR DECISION
- Thomas Dunne is the director of the applicant company which trades as O’Duinns Irish Pub. The business operates from an old two storey building in the main street of Proserpine in northern Queensland. Mr Dunne purchased the building, formerly known as the Palace Hotel, on or about 26 October 2006.
- Between November 2004 and August 2005, Peter Bailey, licensed builder, carried out renovation works for the then owners.
- Following a cyclonic event in early 2010, Mr Dunne made an insurance claim for water damage to the ceiling, walls and carpet of the downstairs dining area of the hotel.
- A report prepared for the insurance assessor identified “multiple building defects and poor building construction practices which have contributed to problems with water ingress” and concluded “this building sees many breaches of the Building Code of Australia various Australian Standards and manufactures (sic) specifications.”
- Mr Dunne lodged a Complaint with the (then) Queensland Building Services Authority dated 15 December 2010 as follows:
Date problem first noticed
Room/area of the house the complaint is located
Description of building work complaint item
No waterproofing ceiling- multiple
or protection to
Failure to comply
installation of withmanufacturers
- Authority building inspector, Michael Hulme, carried out an inspection of the complaint items on 21 February 2011 and issued a Direction to Rectify to Mr Bailey dated 1 June 2011 as follows:
THE USE OF JAMES HARDIE PRODUCT HARDITEX BASE SHEETING AS A HORIZONTAL SURFACE ON THE EXISTING TIMBER DECK VERANDAH IS OUTSIDE THE MANUFACTURES (sic) SPECIFICATIONS FOR THIS PRODUCT. WATER PENETRATION FROM THE EXISTING ROOF ABOVE HAS RESULTED IN SIGNIFICANT DAMAGE TO THE HARDITEX BASE SHEETING.
- Authority building inspector Johnathan Cherry inspected the rectification work undertaken by the builder and issued a second Direction to Rectify dated 10 November 2011 as follows:
- THE INSTALLATION OF THE COMPRESSED FC SHEETING TO THE FLOOR OF THE UPPER LEVEL VERANDAH DOES NOT COMPLY WITH THE OBJECTIVE OF THE BCA 2004, VOL 1 PART F1, CL. F01 NOR DOES IT COMPLY WITH JAMES HARDIE’S TECHNICAL SPECIFICATION MANUAL SECTION 4.1 AND SECTION 10 FIGURE 4 RESULTING IN THE ENTRY OF MOISTURE AND DAMAGE TO THE CEILING AND WALL LININGS IN THE LOWER LEVEL DINING ROOM/RESTAURANT.
PERTAINS TO ITEM ONE ON THE BSA COMPLAINT FORM.
- THE INSTALLATION OF THE ALUMINIUM DOORS TO THE LOWER LEVEL DINING ROOM/RESTAURANT AREA DOES NOT COMPLY WITH PERFORMANCE REQUIREMENTS OF THE BCA 2004, VOL 1 PART F1, CL. FP1.4 IN THAT THE INSTALLATION DOES NOT PREVENT THE PENETRATION OF WATER CAUSING DANGEROUS CONDITIONS FOR THE OCCUPANTS AS WELL AS UNDUE DAMPNESS TO THE BUILDING ELEMENTS.
PERTAINS TO ITEM FOUR ON THE BSA COMPLAINT FORM.
On the request to review and withdraw the “Direct to Rectify” the determination of that review found that the Direction will stay, with the exception of part “consequential damage” (moisture and damage to ceiling and wall linings in the lower level dining room/restaurant) Direction item 1 in that the BSA is unable to apportion full responsibility to the Licensee.
As the BSA has discretion under section 72 0f the Queensland Building Services Authority Act 1991 (the Act) as to whether it will direct the rectification of any alleged defective work. Section 72 (14) of the Act requires the BSA to take into consideration whether it would be unfair to direct a contractor to rectify defective work in a particular circumstance.
In this instance the BSA is of the opinion that it would be unfair to direct the contractor to rectify the water damage to the Dining room ceiling and walls due to the information pertaining to the original condition of the roof sheeting under the verandah and therefore is unable to further progress with this matter and the file is now closed.
- At Mr Dunne’s request, Mr Cherry carried out a reinspection on 1 May 2012. An onsite meeting was then arranged for 23 May 2012, attended by Mr Dunne, Trevor Toomey, a licenced builder engaged by Mr Dunne, Graham Ives, the Executive Manager of Area Offices for the Authority and Brian Hicks, Area Manager.
- Mr Hicks wrote to Mr Dunne by letter dated 1 June 2012 advising inter alia:
Investigations of your concerns have been unable to conclude that the works, subject of your complaint, relate to building works performed or carried out by Mr Peter Bailey…while it is evident…Mr Peter Bailey did undertake internal renovations to the property in 2004/2005, the BSA is not satisfied that such works have caused, contributed to, or otherwise resulted in the water ingress being experienced. The BSA’s further consideration of your matter has determined the current issue relates to work performed by persons unknown and/or maintenance related issues for which the owner is responsible.
- Mr Dunne, by Application for Review filed 2 July 2012, sought a review of the decision in that letter, which affirmed the decision in the letter of Mr Slade dated 16 January 2012, that the Direction to Rectify dated 10 November 2011 stayed with the exception of the consequential damage to the dining room/restaurant.
- Mr Dunne’s Application for Review sought
The sheeting on the balcony which the builder was instructed to replace to be waterproofed.
The damage to the inside of the restaurant to be fixed as per quote $11,770 or builder to repair.
- The Queensland Building and Construction Commission Act 1991 (QBBC Act), formerly the Queensland Building Services Authority Act 1991, gives the Queensland Civil and Administrative Tribunal jurisdiction to conduct a review of the Commission’s (formerly the Authority) decision.On review the Tribunal may confirm or amend the decision; set aside the decision and substitute its own decision; or set aside the decision and return the decision to the decision maker.
- In its review jurisdiction, the Tribunal must decide the review in accordance with the QBBC Act and the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act). For the review the Tribunal has all the functions of the decision maker for the reviewable decision. The purpose of the review is to produce the correct and preferable decision following a hearing on the merits. In effect the Tribunal stands in the shoes of the decision maker and makes the decision afresh having regard to the evidence presented and the law applicable and must be reasonably satisfied, that is on the balance of probabilities.
- The QBCC Act provides that a person who carried out building work may be directed to rectify or complete the building work. All circumstances which are reasonably relevant may be considered in deciding whether to give a direction. Generally a direction must be given within 6 years and 3 months of the building work being completed. A direction must not be given if it would be unfair to do so. The power to direct rectification of building work is discretionary and must be exercised in accordance with the objects of the QBCC Act.
- The QBCC Rectification of Building Work Policy was gazetted and is therefore a statutory instrument which must be applied in reaching the correct and preferable decision. As a guideline the policy provides that a person who carries out category 1 defective building work (building work that adversely affects the performance or functional use of a building or allows water penetration) or category 2 defective building work (faulty or unsatisfactory work which does not meet reasonable standards of construction but does not fall into category 1) should be required to rectify it unless rectification is unfair or unreasonable.
- In accordance with the Policy all reasonably relevant circumstances are to be considered in deciding whether to direct rectification. Delay by the homeowner in notifying the Authority of the defect may be taken into account with the time frame for category 1 defects being more than three months after the defect became apparent and for category 2 defects being more than 7 months after work was completed or left incomplete.
Delays in Hearing
- Directions were made 11 July 2012 concerning the filing of material and a Compulsory Conference was listed for 13 November 2012. That date was changed to 26 November 2012 due to Mr Hicks (who authored the Reasons for the Decision) being on leave. The Conference did not proceed on that date due to Mr Dunne’s poor health and was relisted for 26 February 2013. The matter was listed for hearing in Mackay on 18 October 2013 but that date was vacated due to Mr Dunne’s continuing ill health. The matter was relisted for 31 January 2014 but that date was vacated due to the approach of Cyclone Dylan. The hearing was listed in error on a date not available in Mackay, 16 May 2014, but relisted for 18 June 2014.
- When the matter proceeded to hearing on 18 June 2014, despite numerous directions, the only material filed by Mr Dunne was his initiating Application for Review, to which he had annexed the letter he received from the Authority dated 1 June 2012, a letter from Trevor Franke Carpentry dated 27 March 2010 and a Quotation from Steve Paine Building, and a letter from GW Goddard and Associates Consulting Engineers dated 20 December 2012. Mr Dunne also sought to rely on the report from MCS Group dated 6 July 2010 which was included in the Authority’s annexures to the Reasons. Mr Dunne had not filed any statement of evidence by himself or any witnesses and had not arranged for any witnesses to attend the hearing.
- Mr Dunne sought to play video evidence which he had on a laptop and which he had not previously provided to the Tribunal or the Authority. The videos were played in the hearing and admitted as exhibits on the basis Mr Dunne would provide copies to the Authority and the Tribunal. During cross examination of the Authority’s first witness Mr Dunne became agitated and complained of chest pain. The hearing was adjourned, part heard, to allow Mr Dunne to seek medical attention.
- Directions were made that the Applicant file any further submissions, including audio visual evidence to be copied to disk and the matter listed for a continued hearing on 6 November 2014. That date was vacated and Mr Dunne directed to provide medical evidence of his inability to attend. Throughout 2015, the matter was listed on various dates for a continued hearing and eventually proceeded to a final hearing 11 March 2016. By that date, Mr Dunne had still not provided statements of evidence nor had he made copies of the video evidence as he had been directed. The only further document filed by Mr Dunne was a letter from Assessments Plus Pty Ltd dated 24 July 2014. The author of that letter, Rodney Wilson, attended as a witness for the Applicant by phone.
- Mr Dunne did not file a statement of evidence and did not give evidence in chief as such. His position appeared to be that continuing water ingress into his premises is the result of defective building work by Mr Bailey. The videos he showed at the hearing were taken, he said, during rainfall and showed a considerable amount of water running into the interior of the dining room of the hotel. Mr Dunne said he has been forced to erect tarpaulins during any rainfall to prevent water ingress. He maintains that Mr Bailey should be directed by the Commission to rectify building work which has failed to waterproof the building and further, that the damage which has resulted from water ingress should be repaired by Mr Bailey, or at his expense.
- When cross examined by Mr Szima, Mr Dunne disagreed with the assertions in the report from MCS Group that the verandah roof was in poor condition or required maintenance or that it had reached the end of its lifespan.
- Mr Dunne said he had not had a pre-purchase inspection done due to a “mix-up with the solicitors”. He said “we probably wouldn’t have gone ahead with it if we did have a pre-purchase.” He agreed that such an inspection would “probably” have commented on the maintenance and condition of the property in which case “we would have walked away…or had it fixed.” He went on to say that he thought he probably would not have gone ahead with the purchase because of problems “with the roof and everything else” adding there had been “stuff sprayed on the roof…that we’re noticing now” which was over “most of the roof.”
- The letter from Trevor Franke Carpentry addressed to Mr Dunne stated:
The water down stairs in the dining room area of the O’Duinns Irish Pub is caused by the breakdown of the water proofing and the materials on the above balcony…I believe the balcony up stairs needs to be replaced and water proofed so that no driving rain can settle and soak down. The soft sheet and decking needs to be removed. The decking is moving due to the moisture and the tropical climate and this is helping in the break down of the soft sheet and sealant on it, thus allowing the water to travel through to the dining room ceiling…I would not reckon mend (sic) replacing the decking but rather place some treated timber along side the joists that are there creating fall away from the building to the out side. Then I would use 16mm fibre cement sheeting on top glued and screwed. Water proof the cement sheeting and tiling over the top, is the only affective way to fix this problem. Products can be used in the grout to stop water from coming through.
- Both Mr Dunne and the Commission contended that the MCS Group report supported their position and I will quote the report in its entirety.
Thank you for your instruction to inspect and report on the cause of damage to the ceiling in the downstairs dining area.
You have specifically requested I comment on the cause which led to the ceiling and walls experiencing water penetration from the recent cyclone event as well as comment on the damage to the carpet and provide a scope of works including costings for repairing the ceiling damage.
The O’Duinns Irish Pub is a two storey building consisting of a full length veranda to the front and veranda to the side. The first storey building consisting of backpacker’s accommodation and sanitary facilities. The ground floor consists of; games/pokies room, dining room, publican bar, kitchen, office and lounge room. The building is constructed of some masonry and timber walls, concrete floor and timber floor to the first floor level. The roof structure is timber frame with corrugated iron roof. The first floor level is in below average condition. The ground floor has been renovated at numerous stages and appears to be in good condition. This building is over 100 years old.
The owner Mr Thomas Dunne was present during the inspection.
Observations and Discussion
The verandas to the O’Duinns Irish Pub saw multiple building defects and poor building construction practices which have contributed to problems with water ingress into the dining area of the pub:
- A large amount of corrosion had been identified to the veranda’s corrugated iron
- A large amount of surface rusting to the top of the roof sheeting
- Water proofing material to the side veranda floor is in poor condition and requires replacing
- Front veranda is of timber deck with gap. There is no waterproofing to this section which has enabled the ceiling under the front path exposed to the elements
- Little to no fall to the verandas to allow surface water to run away from the building
- No floor drains installed
- Ceilings to the front veranda directly under the pathway have had sections of cement sheet replaced as well as the timber join covers
- There is a numerous amount of paint blistering from the cement sheet of the front veranda ceiling
The ceiling to the dining room area has had water penetrate from the veranda above which has damaged and stained the ceiling and bulkheads.
- Pictures hanging on the wall have been subjected to water penetration
- Walls adjacent to the side have dried out
The external side wall under the side veranda has numerous amounts of surface cracking to the harditex sheets. There is (sic) numerous water stains along the side wall where water has escaped from inside the veranda cavity.
I have no hesitation in stating that the roof and the veranda floors clearly sees (sic) multiple building defects and poor workmanship along with lack of appropriate maintenance, limiting the life and integrity of the roof, causing water to penetrate and damage the ceilings below. The veranda’s roof has reached its lifespan and requires upgrading and replacing to the current building regulations.The recent cyclone and associated storm events would have added to the problems but the obvious lack of maintenance and poor building practises (sic) has caused the major defects to the ceilings in the main dining room and front walkway.
The cracking to the external harditex sheets adjacent to the aluminium doors appears to have been caused from poor quality installation and failed attempts to comply with manufactures (sic) specifications. Water stains to the side of the building are caused from escaping liquids from the ceiling cavity underneath the verandas.
Finally concluding, cyclone Ului and associated storm events may have been the sole cause of damage to the dining room ceiling and front walkway ceiling, but any storm event with rainfall at the correct angle, hosing down and cleaning the veranda or spilling a drink would penetrate through and enter the ceiling cavity. Replacing the ceiling prior to rectifying the verandas would be a pointless exercise and not eliminate the problem. Without hesitation I confirm this building sees many breaches of the Building Code of Australia various Australian Standards and manufactures (sic) specifications.
- The quotation from Steve Paine Building includes an amount of $22,850 to address water leaking through upper storey veranda:
Remove fibro covering on deck, pull up decking, and dispose of. Sheet floor with 15mm compressed fibro, and wet seal floor to make water proof.
- An additional amount of $11, 770 is included to address damage to the restaurant:
Screen off damage section so rest of restaurant can remain open. Remove water damaged and mouldy gyprock sheets, repair any damaged framework, resheet walls, plaster and paint, dump rubbish and remove screen when finnished (sic).
- The letter from GW Goddard & Associates stated:
A brief visual inspection was carried out by Gary Goddard from this office on 20 December 2012 of the south west corner of the restaurant area of the O’Duinns Irish Pub.
Alterations and renovations have taken place in this area. The alterations included removing an external wall on the lower floor and pushing it out to line up with the outside of the verandah area over.
After alteration and renovations water has penetrated the upper verandah area into the now new internal area of the restaurant.
Any competent builder would have known to ensure the verandah area would require water proofing if over an internal area, and through duty of care should have advised the client and carried out the necessary works. It appears that this had not occurred which has resulted in water damage to the new internal area below the existing verandah.
- None of the authors of these four documents was made available for cross examination; only Mr Wilson, who authored the report from Assessments Plus Pty Ltd.
- Mr Wilson is a licensed wall and floor tiler and water proofer and holds a Certificate IV in both trades. He has over 23 years experience in the industry and said he has a vast knowledge of the building codes of practice. His report referred to water problems due to a leaking deck at O’Duinns Irish Pub. He listed a number of items which in his opinion were not done correctly and required urgent repair:
- The entire deck had not been re-sheeted, this can cause water to get in under the end of the sheets. The entire deck should have been re-sheeted.
- The fall on the deck runs back to the building causing water to lay up against the building, the fall should be running away from the building to drain off.
- There is no evidence the deck has been water proofed, this is so important to prevent water penetration (sic) the entire deck should have been fully water proofed and then tiled over the top to protect the water proofing membrane in this application. I cannot stress enough the importance of this needing to be carried out to Australian codes of practice. I would like to note that the sheeting used has specifications that support my opinion and the installer appears to have not followed these specifications. Note; Clause 3.8 Moisture Management. Harditex System Technical Specification 2005.
With all these factors considered it is my opinion that the deck be taken up and installed to Australian codes of practice.
It should also be noted due to this incorrect installation there is a considerable amount of water coming inside the building and causing an extensive amount of damage to plaster board and framework etc.
- During cross examination Mr Wilson said he had not observed the area above the deck or underneath the timber decking. He explained that he had judged the fall of the deck by the fact “water was laying up against the (house), so hence that’s the lowest point of the deck.”
Evidence of the Commission
- The Commission’s evidence is summarised in the Statement of Reasons for the Decision dated 4 September 2012. As the original decision maker, Mr Hicks, has left the employ of the Commission, the present area manager for the Commission’s Mackay Regional Centre, Mr Slade has adopted the Reasons, making a statement to that effect dated 10 October 2013.
- As set out above, Building Inspector Mr Hulme carried out an inspection of the Complaint items on 21 February 2011, which he did in the presence of Mr Dunne and Mr Bailey. Prior to issuing the Initial Inspection Report dated 25 May 2011, Mr Hulme received further information regarding the matter.
- A letter dated 21 March 2011 from Marylebone Pty Ltd was written at the request of Mr Bailey to the (then) Authority. The letter states in part:
The level of the renovation work initially proposed was significantly different to the actual level of work conducted at this hotel. The hotel from the outset was in a poor state of repair and it appeared to us that very little maintenance work had been carried out on the building premises for a long period of time. In instructing Peter Bailey, the builder, we were conscious of the need to contain total capital costs to a budgeted level as it was always planned that the hotel would be renovated in sections over a number of years as the hotel was very old and was in need of extensive repairs.
The scope of work included:
- Demolish old bar, build new bar in different position within the building, remove some partition walls and replace with steel supports, remove old ceiling and replace.
- Build additional male and female toilets.
- Demolish old kitchen and replace with modern open kitchen and servery.
- Construct fire stairs to rear of building.
- Construct new disabled toilet.
- Construct beer garden at rear of building.
- Concrete car parking area at rear of building.
- Concrete side dining area.
- Renovate upstairs guest’s kitchen.
No waterproofing was commissioned to be undertaken as all building contract work was undertaken within the existing hotel building structure.
Air conditioning installation was commissioned directly with an airconditioning contractor and supervised by an independent consultant.
We advise for your information that the parties which owned the hotel and undertook the renovations and building work ceased their business relationship over 4 years ago and have no further common involvement.
- An email dated 24 May 2011 from a technical support officer from James Hardie advised that:
Harditex base sheets are not able to be installed on a horizontal plane or as a flooring substrate.
- The Initial Inspection Report by Mr Hulme relevantly provides:
The licensee has advised that there was no contract and that the work was carried out on a do and charge basis…the original verandah decking boards on the side were covered with HardiTex Base sheeting as some decking boards were weather damaged and …were cut to install the air conditioning duct work through the upper verandah (which) was not part of the work he was engaged to carry out.
The licensee advised that the covering of the decking boards was never intended to be waterproofing to the deck. Under the original deck there is existing corrugated metal roofing sheets; mini orb profile on the side verandah and normal corrugated profile on the street side. The metal roofing drains to the front and side of the building to internal box gutters. The under side of the front box gutter is visible from the street side. Visual inspection of the metal roofing was undertaken by lifting decking boards to view sections under the decking boards. The metal roofing at both the front and side is filled with debris. The sheeting does not finish against the internal walls and no apron flashing has been originally installed. It is the opinion of the inspector that the existing roof sheeting under the timber decking boards on the verandah would never provide 100% adequate waterproofing to areas beneath. MCS Group…provided a report dated 6 July 2010 to the owner’s insurance company that was requested to inspect and report on the cause of damage to the ceiling in the downstairs dining area. The report had specifically been requested to comment on the cause which led to the ceiling and wall experiencing water penetration from the recent cyclone event…
It is noted from the report by MCS Group that the water damage to the ceilings occurred during Cyclone Ului in March 2010. Proserpine experienced the full effects of Cyclone Ului as it passed over. As the work was originally completed on 11/08/2005 it would appear that the existing metal roof sheeting and the internal box gutter system was coping with normal rainfall events, but was overwhelmed with rainfall during Cyclone Ului…
The inspection by MCS Group failed to identify the existing metal roof sheeting or the internal box gutter system, had they been aware of this, they may have considered a claim due to the extreme weather event…
The Authority is faced with the situation where it must first determine what work the licensee was required to carry out in the agreed ‘scope of works’ and then should the licensee have been aware of the inadequacy of the existing metal sheeting to act as weather protection to the area he worked on below. If the licensee was aware of the inadequacy of the metal sheeting he should have informed the previous owner of his concerns and advised of further works required to weather proof this area he was renovating…
Both parties advised that the previous owner that the licensee carried out the works for is now his business partner in a back packer’s accommodation…
Complaint Item 1
Visual inspection noticed significant water damage to the internal ceiling and wall linings of the dining area in both the front section and the side section adjacent to the side aluminium door installed by the licensee. Water ingress is evident to have occurred from the open verandah above.
The owner advised he believes that the existing side window at the front left hand corner of the building that was cover (sic) over by the licensee is also leaking, however the owner was unwilling to allow water testing to be conducted with a garden hose to correctly identify if the leak was from around the window or from just the verandah above. Water damage is evident above the window from the verandah. Due to the owner being unwilling to allow water testing to occur, the inspector is unable to determine if the window is leaking. BSA is unable to assist further regarding the window.
Inspection of the timber verandah deck on the side that has been covered with HardiTex Base sheet revealed that the existing decking boards have peaked approximately 60mm in the middle section above the side aluminium door. At present the owner has tarps covering the deck in an effort to provide weather protection to the dinning (sic) area below.
The corrugated metal roofing above the verandah is in poor condition allowing water ingress to occur in several locations and numerous patches are evident. It is evident that water from the original metal roofing above the verandah has leaked onto the area where the HardiTex base sheeting has been affected.
James Hardie Australia has confirmed that the use of HardiTex base sheeting in this situation is not a suitable substitute for a flooring substrate.
Therefore the licensee is responsible to rectify the incorrect use of the HardiTex sheeting, however this does not address the issue of the waterproofing of the deck which the licensee was not engaged to carry out. The licensee is not responsible for the damage that has occurred to the internal linings as this is a failure of the waterproofing which led to the damage evident.
Waterproofing of the deck is the responsibility of the owner.
Complaint Item 2
Visual inspection noted that the front section of the verandah has not been covered with cement sheeting; the existing timber decking boards are still evident. Existing corrugated metal roofing sheets as noted in the general background notes above is (sic) evident below the decking boards. As noted above this is ineffective to provide 100% adequate protection to enclosed area below. Cement ceiling sheeting has been replaced below from water damage that has occurred.
The licensee has advised that he did not carry out any work to this area and that the verandah ceiling lining was existing. The inspector has no evidence to suggest that the licensee carried out work to this area.
As noted in the general notes this is evidence that the original metal roof sheets under the timber verandah draining to the internal box gutter system was performing adequately prior to Cyclone Ului.
No further action is required by the BSA.
Complaint Item 3
The report by MCS in the conclusion states “The cracking to the external HardiTex sheets adjacent to the aluminium doors appears to have been caused from poor quality installation and failed attempts to comply with manufactures (sic) specifications.”
Visual inspection noted that the cracking of the rendered sheets and the finish of the sheets to the existing concrete structure of the building is considered to be a category 2 defect in that minor cracks are evident to the finished rendered surface and the finished rendered surface is not of a standard expectant of a competent tradesman.
This item has been investigated and identified as a Category 2 defect. The item does not adversely affect the structural integrity or performance of the building, or does not constitute a health or safety issue, therefore Queensland Building Services Board policy requires notification to be submitted to BSA within 6 months of the completion date for the building (11/08/05).
There is no evidence of water ingress occurring around the door and the owner was unwilling to allow water testing to be conducted with a garden hose to correctly identify if any water ingress was occurring.
No further action is required by BSA.
- The Direction to Rectify dated 1 June 2011 as set out in the Background above was issued. Mr Bailey advised the Authority that rectification had been completed. A site meeting with Mr Hicks, Mr Cherry and Mr Dunne took place on 27 October 2011 to discuss Mr Dunne’s dissatisfaction with the result of rectification. Mr Cherry arranged to conduct a reinspection to include water testing on 8 November 2011. Following that reinspection, the findings of which are set out in Mr Cherry’s report of the same day, the Directions to Rectify dated 10 November 2011 as detailed above, were issued.
- Further reinspection was carried out by Mr Cherry on 12 January 2012. His report of the same date notes the cement sheet flooring was now installed in accordance with the manufacturer’s specifications and the direction with regards to the doors had also been complied with.
- Mr Slade’s letter dated 16 January 2012 notified Mr Bailey and Mr Dunne that following a request to review and withdraw the “Direct to Rectify”, the determination was that the Direction would stay with the exception of the part pertaining to consequential damage.
- At Mr Dunne’s request, Mr Cherry carried out a further reinspection on 1 May 2012. His report of the same date noted water testing of the rectified deck and of the dining room doors resulted in no water being evident in the building. Water testing of the wall above the window in the dining room resulted in water dripping into the building behind the window however he attributed that to the deterioration of timber mouldings which were installed prior to work being undertaken by Mr Bailey and out of time to direct rectification.
- Following the further site meeting on 23 May 2012, the letter dated 1 June 2012 was sent.
Evidence of Phillip Slade
- Mr Slade is the current Area Manager and the adopted decision maker. He has not attended at the site other than to take photographs of the outside of the building prior to the hearing. He is a qualified builder and building inspector. Mr Slade, as Acting Area Manager at the time, signed the letters to Mr Bailey and Mr Dunne dated 16 January 2012 which advised of the amendment to the Direction to Rectify. His evidence was that the decision to Direct Rectification or not is determined by the building inspector involved, in this case, Mr Cherry.
- During cross examination Mr Slade suggested two methods of addressing the problem of ongoing water ingress into Mr Dunne’s hotel. He said one method was to remove the decking and reinstate the drainage system originally installed before replacing the decking. The other way, which could be a cheaper option, would be to completely redeck the verandah with a superior board which could be tiled and waterproofed. He pointed out that the heritage status of the building may impact on what was allowed to be done. He was not able to estimate a cost on the spot.
Evidence of Johnathan Cherry
- Mr Cherry is a building inspector employed by the Commission and carried out the inspections of the premises on 8 November 2011, 12 January 2012 and 1 May 2012. He confirmed that at the last inspection he had carried out water testing and found the decking which the builder had rectified in accordance with the (then) Authority’s Direction, was performing as it was intended in terms of compliance with the manufacture’s specifications. He confirmed that no further action had been required of the builder.
- In cross examination, Mr Dunne put to Mr Cherry that after he left the building during his last inspection, Mr Dunne and his wife had asked Mr Cherry to return to see water in the restaurant. Mr Cherry agreed. In his report dated 1 May 2012 Mr Cherry noted water ingress into the dining room more than half an hour after testing finished. He identified the cause as the deterioration of timber mouldings resulting in gaps between the timber and sheeting which allowed water to penetrate the building. He stated in his report “This is a Cat 1 defect and out of time to direct the licensee as this work was completed prior to any works by Mr Peter Bailey.”
- Mr Dunne suggested to Mr Cherry that the verandah decking of his hotel ought to have been waterproofed and tiled. Mr Cherry said that was not required where there was a separate waterproofing system underneath the decking boards. He said the installation of the HardiTex sheeting required water-resistant installation with a drip edge with fastenings and certain spacings and to be painted, but did not require waterproofing membrane in that application where the sheeting was not the primary weatherproofing system.
- I asked Mr Cherry why, when the earlier Direction to Rectify included the consequential water damage to the interior of the building, the decision was made, on request of Mr Bailey, to remove that part of the Direction. He responded:
The reason I believe our area manager-because I believe it was the area manager that made that call to remove the consequential damage was because the product itself, although defective which is why we directed him to fix it, wasn’t the primary weatherproofing system for the dwelling. Therefore, if the primary weatherproofing system was adequate at the time of the complaint form, we wouldn’t be having the complaint because there wouldn’t be water ingress. Our understanding at the time was the installation of the original (sheeting) was to fix issues with how smooth the decking was, not a waterproofing system.”
- In response to further questions by Mr Dunne as to why was the builder not directed to fix up damage on the inside, Mr Cherry said:
The product he’s used has allowed water onto your primary waterproofing system. If the primary waterproofing system, which was original, was performing, it would not be entering the restaurant.
- As to why Mr Bailey had sheeted the area, Mr Cherry responded:
From the documents I recall reading, he had - the owner had engaged air conditioning consultants to do air conditioning and they damaged some of the boards and the purpose of him installing that board was to cover up the areas that weren’t trafficable.
- Mr Cherry said he was not aware whether damage had occurred to the waterproofing system underneath the deck from the work of the air conditioning installers and had not inspected for that. Mr Cherry said he had read about the primary waterproofing system in the previous inspector’s report but also on site he could see through the decking boards and identify corrugated iron underneath.
- I asked Mr Cherry whether, in a situation where a builder has been engaged to undertake interior refurbishments, and is aware that the system of waterproofing is failing, is the builder obliged to remedy that system, before undertaking the refurbishment?
- Mr Cherry replied that if water was getting in, he would expect that to be remedied, but in this case, there was no evidence of water ingress prior to the complaint and four years had elapsed since the completion of the renovations.
- Mr Cherry confirmed that he observed the iron roof of the hotel to have reached the end of its expected life span. When asked by Mr Dunne, he said he had not water tested the roof as there was no evidence that Mr Bailey had worked on the roof and he was only there to investigate Mr Bailey’s work.
Evidence of Peter Bailey
- Mr Bailey said he is a building contractor and has held a contractor’s licence for about 22 years. He recalled carrying out work at the former Palace Hotel in Proserpine for the then owners. He did not recall the date he completed the work other than it was quite some time ago.
- Mr Bailey recollected that the Commission had required him to replace sheeting on the western deck of the hotel and subsequently found he was not responsible as builder for water entering the building.
- Mr Bailey agreed with the contents of the letter from Marylebone Pty Ltd dated 21 March 201, specifically as to the state of repair of the building and the scope of works for which he was contracted. He agreed as stated in the letter that he had not been contracted to carry out waterproofing, work being on the existing hotel structure and that air conditioning was undertaken by another contractor independent of Mr Bailey. Mr Bailey agreed as written in the letter that his business relationship with the former owner ceased more than four years before the letter was written and the parties had no further common involvement.
- In cross examination Mr Bailey said whilst he could be described as the main man on the job, the owners had employed other contractors to do several parts of the job.
- As regards the sheeting on the verandah, Mr Bailey said that had been one of the last things he did on site and was outside his scope of works. He said he believed the owners planned to replace the decks at some stage and the sheeting was a temporary cover over unsightly parts. He said there had been staining work done in that area and maybe the intention was to cover the staining. Mr Dunne suggested that Mr Bailey in a previous report had mentioned that a few boards needed to be replaced. He asked Mr Bailey why would he not have just replaced a few boards rather than doing that amount of sheeting. Mr Bailey replied that he thought it had involved more than just a few boards and he thought the owners might have ascertained the deck was still stable to walk on but unsightly, although that was only his assumption.
- When Mr Dunne suggested it was odd that only that side of the deck had been sheeted, Mr Bailey said from memory there were holes in the roof above that area which may have resulted in more damage. When asked why not fix the holes in the roof while he was there, Mr Bailey said that was a matter for the owners.
- Mr Dunne had issues with the drainage of the beer garden and the installation of sails. Mr Bailey said he was not involved in those matters. He said he was not the project manager for the renovation; that had been a Paul McEnroe.
- In response to my question Mr Bailey said he did not believe that the ground floor external walls of the hotel had at some point been moved from a more interior position to line up with the outer edge of the first floor verandah but were constructed that way originally.
- In re-examination, Mr Bailey described there being another roof underneath the decking boards designed to carry water that went through the decking boards to “existing downpipes and guttering and drainage” which “was how they use to stop the water from entering the building.”
- Mr Bailey described that roof as being in good condition, with a “build up of dirt and dust and stuff, but it seemed to be working.” He said he had not been instructed to work on that roof and would not have been able to get to it without removing the decking.
- Mr Bailey said if he had known the sheeting was to be left in place more permanently he would have used the correct floor sheeting and “that was why I didn’t complain when the QBCC asked me to replace the decking.”
- Mr Bailey was asked whether he was aware of any water ingress issues at the time he was requested by the owners to put the sheeting down. He replied “that’s a difficult one. I’d say no.” He said there were no permanent water issues as far as he remembered but he recalled that air conditioning contractors had been half way through installing ducts when it stormed overnight and water ingress occurred. He did not recall how much water and did not think he was on site at that time.
- Mr Dunne, as I have noted, did not file a written statement. Nor did he give his own evidence in any organised fashion. As a self-represented party, he was given much leeway by me and by the Respondent’s representative, in the presentation of his case and the manner in which he conducted himself during the two days of the hearing.
- I accept that Mr Dunne has had serious health issues. I accept he has experienced stress in dealing with the water issues in his hotel and has found these proceedings frustrating and stressful. I have made every effort to understand what his position was in relation to his application for review by obtaining transcripts of the hearing and reviewing what was said by Mr Dunne although, during hearings, his arguments were often difficult to follow.
- Mr Dunne appeared to assert that at the time Peter Bailey undertook the renovations at the Palace Hotel, Mr Bailey knew or ought to have known that there was or would be a problem with water ingressing the building and that he had what Mr Dunne asserted was “a duty of care” to take whatever steps were required to address that issue. Mr Dunne questioned Mr Bailey’s assertion that Mr Bailey was not project manager for the renovations and that Mr Bailey did not have overall responsibility for all building work done by the then owners.
- Mr Dunne asserted that Mr Bailey’s removing a section of wall to install sliding doors to the dining room, resulted in water ingressing the dining room. Mr Dunne asserted that rather than doing a proper job, Mr Bailey, possibly in collusion with the owners with whom he had been in a business partnership, installed the sheeting to stop the water ingressing. Mr Dunne asserts the correct method would have been as described in the letter from Trevor Franke, the quotation of Steve Paine and the report of his witness, Rodney Wilson, that is, that the decking be removed and/or re-sheeted with a waterproof membrane and tiled. Mr Dunne asserted that Mr Slade had agreed this was the correct method when cross examined.
- Although Mr Dunne disagreed with parts of the report from MCS Group which referred to poor maintenance and the roof having reached the end of its lifespan, he cited the report as supporting his application for review, in that the report referred to “multiple building defects and poor building construction practices”.
- Mr Dunne also relied on the report from GW Goddard & Associates in support of his assertion that the builder had been incompetent and failed in his duty of care.
- Mr Dunne rejected the suggestion that the sheeting had been installed to cover unsightly or damaged boards or the holes from the installation of air conditioning ducting.
- Although he had not lodged a complaint with the (then) Authority until December 2010, and that complaint indicated that water leaks were first noticed in January 2009, Mr Dunne asserted during the hearing that “the water was coming into our restaurant since day one” and he had just been “lax” putting in the complaint. At another point during hearing, Mr Dunne said the complaint ought to have been made in 2007.
- Although Mr Dunne conceded that the state of the roof was such that had he obtained a pre-purchase inspection, he would not have gone ahead with the purchase, he disagreed the roof had reached the end of its lifespan. He pointed out in support of that assertion, that the rooms on the first floor had not suffered any water damage, which would be expected if the roof needed to be replaced. He also questioned why Mr Cherry had not water tested the roof if it was contended water could be getting into the building because of the state of the roof.
- I will summarise the final submissions of Mr Dunne which he made having heard the argument of the Commission and with my suggestions as to the matters he needed to address.
- Mr Dunne submitted that the building defect was that the builder knew of water entering the building but instead of removing the decking and properly fixing the problem of the roofing system underneath, he sheeted over it as an easy fix given the hotel was being renovated to sell. To make matters worse, the builder did not use proper materials or waterproof or tile the decking.
- Mr Dunne rejected the suggestion that the entire western deck would be sheeted to cover unsightly boards which could have readily been replaced. He asserted the reason the builder sheeted the decking was to prevent rain getting in between the boards and entering the restaurant. He asserted there was nothing wrong with the state of the decking boards which are still in good condition on the other three sides, especially the decking adjacent to where work was carried out.
- He said Mr Bailey’s not complying with industry standards and using wall instead of floor sheeting, not waterproofing and not tiling, has resulted in the sheeting deteriorating over time and water entering the restaurant. Therefore, he said, Mr Bailey is responsible for the internal damage to the restaurant.
- Mr Dunne asserted that the state of the roof is not the cause of water getting in. The verandah is open and water blows in whether or not there is a roof. Water damage would be expected in the first floor rooms if the roof was the problem. The large hole in the roof mentioned by the Commission is on the outside of the verandah railing and if water were poured through that hole, it would not enter the verandah.
- He alleged the letter from the former owner is covering up for Mr Bailey who is a mate and business partner.
- As regards Mr Wilson’s lack of qualifications to install a deck, Mr Dunne noted he is qualified to waterproof one.
- Mr Dunne objected, as he had done on numerous occasions during the hearing, to Mr Slade attending at the property to take photographs without coming in to inspect the alleged defects. He said the photographs were taken to make the hotel look bad. He asserted Mr Slade agreed with Mr Dunne’s experts on the correct method of rectifying the water ingress.
- Mr Dunne alleged Mr Bailey was responsible for numerous building defects at his hotel and was “covering up” what he knew and for what he was responsible.
- Mr Dunne rejected Mr Cherry’s evidence that the rectified work done by Mr Bailey was to building standards. He cited the fact that water continues to enter his dining room in large volumes as evidence of the failure of the rectified work and the fact that this is the only area of the building where water gets in to the interior.
- Mr Bailey and Mr Cherry gave evidence of the existence of a primary water proofing system beneath the timber decking. Mr Wilson, who gave evidence on behalf of Mr Dunne was not aware of the existence of that system in making recommendations for the waterproofing and tiling of the decking. No mention of that system was made in the written documents of the other professionals from whom Mr Dunne sought an opinion and without any of them attending to give evidence there is no evidence they were aware of the system when giving their opinions.
- The report from MSC Group refers to “multiple building defects and poor construction practices”. The only matters observed in the report which appear to refer to defects are the absence of waterproofing to the front deck, “little to no fall to the verandas to allow surface water to run away from the building” and that no floor drains were installed. The remainder of the matters raised in the report appear to refer to maintenance issues.
- The Commission’s Initial Inspection Report identified the existence of the under decking waterproofing system. The author notes that system appeared to have been coping with normal rainfall events but was “overwhelmed with rainfall during cyclone Ului.” The report continues:
The inspection by MCS Group failed to identify the existing metal roof sheeting or the internal box gutter system, had they been aware of this, they may have considered a claim due to the extreme weather event.”
- The author of the report of GW Goddard & Associates not only makes no reference to the under decking waterproofing system but has taken the view that the external walls of the ground floor level of the building have been “pushed out” to “line up with the outside of the verandah area over.” The plans submitted at the time of the renovations carried out by Mr Bailey do not indicate such an alteration was made by him and the view of Mr Bailey was that the hotel would have been originally constructed with the exterior wall of the ground floor in its current position.
- Mr Dunne has taken issue with the fact that the (then) Authority changed its position. Initially Mr Bailey was directed to rectify only the Harditex sheeting. A second direction required rectification of the installation of sliding doors and the damage resulting from water entry. The direction was finally amended to not require rectification of the consequential water damage. Mr Slade in giving evidence said the view of the building inspector at the time would have prevailed in arriving at that decision. Mr Cherry, who was the building inspector, in his evidence said the decision had been made by the Area Manager. He was not asked to clarify whether that had been the Area Manager, Brian Hicks, who had himself attended on site and signed the letter dated 1 June 2012, or Mr Slade who as Acting Area Manager at the time had signed the letter dated 16 January 2012. In any case, in conducting a fresh review on the merits, I am to make the correct and preferable decision based on the evidence available to me.
- Mr Dunne’s witness, Mr Wilson, was not aware of the water proofing system identified by the (then) Authority’s Initial Inspection, nor was he qualified in building or carpentry. None of the reports provided by Mr Dunne from other professionals identified that system.
- Mr Bailey gave his evidence in a straightforward manner. He did not give the impression that he had in any way reviewed the evidence before the Tribunal prior to attending as a witness for the Commission. For example, he did not immediately recollect the decking having been cut by airconditioning installers, which is one of the reasons he cited during the initial inspection for the decking needing to be covered.
- I accept Mr Bailey’s evidence as a very experienced builder as to the existence of the waterproofing system beneath the guttering. Mr Cherry confirmed he had sighted the system although he did not pull up boards to inspect it as Mr Hulme had done during the initial inspection.
- I accept Mr Bailey’s evidence of the scope of works he was contracted to undertake at the hotel and his evidence about the laying of the HardiTex sheets. He accepted such sheeting was not specified for flooring and that a rectification notice in that regard was appropriate. I accept his evidence there was no indication that the existing waterproofing system was not working adequately and do not find, as suggested by Mr Dunne, that Mr Bailey had any duty of care to recommend work or carry out work, on the existing waterproofing system, at the time he carried out other renovations.
- Mr Dunne asserted there was water ingress to his hotel prior to Cyclone Ului but produced no evidence of that. He took no steps until after the cyclone, when he made a claim for insurance.
- I do not accept Mr Dunne’s assertion that Mr Bailey was the project manager of the hotel refurbishment and therefore responsible for the renovations in their entirety. If airconditioning contractors have caused or contributed to the water ingress with the installation of ducting, I do not find Mr Bailey is responsible. He gave direct evidence he was not the project manager and in the absence of evidence to the contrary, I accept his evidence. Mr Dunne asserted he knew “150” people who considered Mr Bailey was in charge of the job but he did not obtain any statements.
- Mr Dunne raised with Mr Cherry his recollection that on the last occasion Mr Cherry had conducted water testing at his premises, the water ingress into the dining room only became apparent after some delay. Mr Cherry’s report of 1 May 2012 reported that a water test of the wall above the window in the dining room resulted in water ingress more than half an hour after testing finished. As already noted, Mr Cherry reported that he inspected the exterior wall and found that timber mouldings, not installed by Mr Bailey had deteriorated so that water was penetrating between gaps in the timber and wall sheeting. He therefore did not direct rectification by Mr Bailey. This is a separate point of water entry to that which may be occurring as a result of the under decking waterproofing system no longer working.
- Mr Dunne questioned the honesty of the Commission’s employees accusing them of being aligned with the interests of the builder. I do not accept that. The objects of the Commission are legislated to include regulating the building industry to achieve a reasonable balance between the interests of building contractors and consumers. Both Mr Slade and Mr Cherry remained calm and polite while giving evidence despite the sometimes aggressive criticism of Mr Dunne during cross examination. They repeated their explanations with patience. I have accepted the evidence of both these gentleman as well as that of Mr Bailey in reaching my conclusions.
- Mr Dunne has submitted that Mr Slade supported his contention that the proper method of waterproofing the deck involved replacing the decking and waterproofing it, including by tiling. That was not what Mr Slade said. Mr Slade was asked by Mr Dunne how to fix the current situation of water ingress. Mr Slade said that either the failed existing system of waterproofing could be replaced or repaired which would involve taking up the decking to get to the roof and guttering underneath. The alternative was to waterproof and tile the decking. At the time Mr Bailey put sheeting on the decking, there is a lack of evidence, as I have already said, of the under decking waterproofing failing. Mr Bailey was therefore not faced with these choices.
- Mr Cherry’s evidence, which I accept, is that he observed water damage to have occurred to the internal linings of the dining room, the awnings over the front footpath and the external face of the wall on the laneway side of the dining area. He also observed the roof above the deck on the laneway side of the property to be in a poor state of repair and condition, that the roof above the deck has reached its lifespan and water had discharged through holes in the roof sheeting above the deck. He concluded that he could not attribute the source of the water leaks to works carried out by Mr Bailey.
- The MCS Group report, upon which Mr Dunne in part relied on, also states the roof has reached its lifespan. Mr Dunne admitted the state of the roof is such he would not have proceeded with the purchase had a pre purchase inspection been available to him.
- I accept that Mr Bailey complied with the directions to rectify in relation to the HardiTex sheeting and the installation of the sliding doors.
- As to ongoing water ingress, I find there is no evidence that Mr Bailey carried out work which has resulted in that water ingress. While water may have been entering the building via the sheeting which Mr Bailey installed and which was defective as floor sheeting, I find the evidence supports the contention that there was an existing waterproofing system, that is metal roofing under the decking and internal guttering, which failed at some time after Mr Bailey carried out renovations, and resulted in water penetrating the building. Mr Bailey was not responsible for the existing system and was not contracted to undertake waterproofing. It follows that he is not responsible for the interior damage to the hotel resulting for water ingress.
- The decision of the Queensland Building and Construction Commission dated 1 June 2012 not to direct rectification of items 1, 2, 3 and 4 of the complaint dated 15 December 2010 is confirmed.
 Final Inspection Certificate by building certifier dated 11 August 2005: Annexure SOR-2 to Statement of Reasons for the Decision.
 Report by MCS Group dated 6 July 2010: Annexure SOR-3 to Statement of Reasons for the Decision at page 20.
 Ibid at page 2.
 Ibid at page 12.
 Annexure SOR-14 to Statement of Reasons for the Decision.
 Annexure SOR-15 to Statement of Reasons for the Decision: letter to P. Bailey and letter to T. Dunne attached to Application for Review.
 Annexure SOR-17 to Statement of Reasons for the Decision.
 Annexure SOR-19 to the Statement of Reasons for the Decision.
 Queensland Civil and Administrative Tribunal Act 2009 (Qld) s 24.
 Ibid s 19(a).
 Ibid s 19(c).
 Ibid s 20.
 Queensland Building and Construction Commission Act 1991 (Qld) s 72(1).
 Ibid s 72(2).
 Ibid s 72(8).
 Ibid s 72(14).
 Ibid s 3.
 Statutory Instruments Act 1992 (Qld) s 7.
 This section of the report also included 18 photographs of the property taken during the inspection.
 Paragraph 6.
 Annexure SOR-8 to Reasons for the Decision.
 Annexure SOR-9 to Statement of Reasons for the Decision.
 In Mr Hulme’s report, Complaint Item 3 in the Complaint form, pertaining to waterproofing of the underside of the ceiling appears to have been dealt with within Complaint Item 2 and Complaint Item 4, pertaining to the installation of doors, has been dealt with as Complaint Item 3.
 By telephone as deposed to by Mr Hicks in statement dated 21/02/13 at paragraph 14.
 Ibid at paragraph 15 and annexed memorandum.
- Published Case Name:
Dubs Pty Ltd t/as O'Duinns Irish Pub v Queensland Building and Construction Commission
- Shortened Case Name:
Dubs Pty Ltd t/as O'Duinns Irish Pub v Queensland Building and Construction Commission
 QCAT 194
23 Jun 2016