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- Unreported Judgment
Nicol v Wellard  QCAT 260
11 July 2016
Member McLean Williams
1 August 2016
Order as follows:
Judgement for the Applicant.
The Respondent is to pay the Applicant $26,105.00 within twenty eight (28) days.
Residential Building Dispute; claim for unpaid monies under building contract; Signed lump sum contract for $85,000. Homeowner contending that actual agreement was an oral one, to construct additions for $65,000, notwithstanding contrary written contract signed by parties for $85,000. Factual dispute regarding terms of agreement and entitlement to monies. Failure by Respondent to call a material witness. Circumstances where builder claims additional sums for variations and extras without written variations and little supporting evidence.
APPEARANCES and REPRESENTATION (If any):
REASONS FOR DECISION
- The Applicant, Mr John Nicol, is a registered builder who was retained by Ms Karen Wellard (the Respondent) to construct a new addition onto the rear of her home, at Tingalpa.
- According to a written contract signed by both parties on 18 February 2015, the price for this extension was agreed to be $85,000.
- Mr Nicol says that despite the project having been completed, he has only been paid $59,200.00; such that he is still owed $25,800.00 pursuant to the contract, as well as some further sums, for variations and extras. Including the QCAT filing fee ($305), Mr Nicol says that he is owed a total of $28,937.60 by Ms Wellard.
- Although Ms Wellard admits to having signed a contract on 18 February 2015 by which she is required to pay $85,000.00 to Mr Nicol, she says that this was not their bargain. Ms Wellard says that she and Mr Nicol had a collateral oral agreement, whereby Mr Nicol had agreed to charge her a maximum of only $65,000. Ms Wellard says that the higher figure ($85,000) had been included in the signed contract only in order that she could obtain additional funds from her financier, the ME Bank, in order to purchase the kitchen, and also for her to be placed in sufficient funds that she could pay back some previous loans, owed to her parents. Ms Wellard says that the maximum sum that she could borrow from the ME Bank was $120,000. Ms Wellard says that she already owed her parents $35,000; and that she needed $20,000 to pay for the kitchen (which she was going to purchase independently, and then have Mr Nicol install for her), such that these two amounts needed to come out of the $120,000; meaning that only $65,000 was ever going to be available to pay the builder. Ms Wellard says that at the time of their contracting these things were made known to Mr Nicol, and he readily agreed to do the job for $65,000.
- Ms Wellard also says that the last invoice that she received from Mr Nicol was on 22 May 2015 and that she did not hear from him after he had left the site in August 2015. In light of that, Ms Wellard says that she had naturally assumed that Mr Nicol regarded the job as being over, and that no more money was owed by her, because if it were, then surely Mr Nicol would have raised the matter far sooner than October 2015.
- Quoting from the material filed by her before QCAT, Ms Wellard says that Mr Nicol is only now - much more latterly - claiming that money is still owed to him under the contract, because the ME Bank “illegally” contacted Mr Nicol, in October 2015, to inquire whether he was still owed any money, and at that stage “his eyes [must] have lit up and he has obviously seen the opportunity to claim monies he was NEVER entitled to.”
- Ms Wellard also says:
- Mr Nicol has been paid $60,200 and not $59,200, as now claimed by him;
- That she was required to pay the QBCC Insurance ($926.90) because Mr Nicol didn’t have any money;
- At no time was she given any variation documents;
- After Mr Nicol had departed the electrician gave her an invoice for $3,000 for extra electrical work. Because Mr Nicol had made a provisional sum allowance for electrical and plumbing work of $5,000 she just ignored the electrician’s invoice;
- Mr Nicol replaced the gutters on her existing roof without her permission. When she complained about the newly installed gutters, Mr Nicol assured her that it was part of the original $65,000. Despite that assurance, she later received an invoice from Mr Nicol for about $1,300.
- Mr Nicol tells a very different story. He says that in December 2014, he was approached by a person named Emmanuel Kerry, who asked Mr Nicol by e-mail to quote on plans for a building job “for a very dear and good friend of mine, so I need a good quote for this one”.
- Mr Nicol says that he had advised Emmanuel Kerry that his price for the job would be $85,000, whereupon Mr Kerry had asked whether Mr Nicol could do the job for $65,000. Mr Nicol says that he responded by saying that it was conceivable that this job could be done for as little as $65,000, yet this target price would only be achievable if certain items, presently included on the plan, were first deleted, as a cost-saving measure.
- Mr Nicol says that the two items that were specified by him to Emmanuel Kerry as potential deletions (in order to bring down the price) were: the hardwood floors (which Mr Nicol says would have saved about $12,000 if these were not included as part of the project); and also the VJ wall sheeting. Despite this advice, Mr Nicol says that when the time came to actually sign the contract, both the hardwood floors and the VJ sheeting remained as inclusions on the plan, such that the price on the contract signed by both himself and Ms Wellard remained at the originally quoted figure, of $85,000.
- Mr Nicol absolutely denies that there was any collateral oral agreement that he would do the job for only $65,000.
- There is no dispute between the parties that the written contract specifies an amount of $85,000. Nor is it disputed that their respective signatures appear on that document; and that each of their signatures was witnessed by Emmanuel Kerry.
- Mr Nicol further says that Emmanuel Kerry was acting as the project co-ordinator, and that Mr Kerry helped him with the initial set-out, and then during the concrete pour for the footings. Mr Nicol says that it became clear to him during these early stages of the project that Emmanuel Kerry was involved in some type of romantic relationship with Ms Wellard. Yet, mid-way through the project, Mr Nicol says that Emmanuel Kerry ‘just disappeared’, never to be heard from again. Mr Nicol says that the remainder of the project was difficult for him as the builder, because ‘nobody was running it’.
- For her part, Ms Wellard denies that Emmanuel Kerry was the project coordinator, and says that he was never anything more than the draftsman whom had been retained to draw up the original plans. Ms Wellard also denied having been in any form of relationship with Mr Kerry. Although Emmanuel Kerry had witnessed the signing of the contract in the amount of $85,000, she says that it was absolutely clearly understood by herself, Mr Nicol, and Emmanuel Kerry that Mr Nicol had agreed to do the job for $65,000 and this matter was specifically discussed at the time of signing.
- It is to be observed that Emmanuel Kerry was not called as a witness in these QCAT proceedings, despite he now being the only person potentially capable of shedding any light on the true agreement between Mr Nicol and Ms Wellard - that which Ms Wellard says was negotiated orally in the presence of Emmanuel Kerry.
- The only witness called during these proceedings – that is, the only person other than the Applicant and the Respondent - was Ms Wellard’s own father, a Mr Kenneth Turner, who gave evidence that:
- his daughter owed him $35,000, and this money was paid to him from the ME Bank loan facility;
- he paid $12,130.60 on his credit card at Ikea for a Kitchen for his daughter, and she needed to pay him back for this, such that this amount was also paid to him by drawing on the funds that were available via the ME Bank loan facility;
- he had “raised his daughter to always tell the truth” - such that the Tribunal should now accept Ms Wellard’s evidence when she says that the contract was for only $65,000; and
- sometime very late in 2015 (after 17 November 2015), Emmanuel Kerry had met with Mr Turner in a coffee shop, whereupon Mr Kerry had informed Mr Turner that “Mr Nicol was not expecting to be paid more than $65,000 for this job, as he had definitely agreed to do it for $65,000”.
- On the latter point, this evidence from Mr Turner is very clearly hearsay. More specifically, it is also completely denied by Mr Nicol, who says that he agreed to do the job for $85,000 and had merely had prior discussions with Emmanuel Kerry about ways that the project ‘could be’ done for the lesser sum, if key inclusions were first deleted from the specification, a matter which did not eventuate.
- In the absence of direct testimony from Emmanuel Kerry and because of the explicit denial by Mr Nicol, I am not prepared to attach any weight to this hearsay evidence from Mr Turner. In circumstances such as those described by Ms Wellard and her father the Tribunal would need to hear testimony directly from Emmanuel Kerry, yet Mr Kerry has not been called by Ms Wellard as a witness in her cause.
- Given that Mr Turner was able to make contact with Emmanuel Kerry as recently as late 2015, and was able to ask him questions going to the critical issue (and at a time when this dispute was already before QCAT and the centrally important role of Mr Kerry’s likely evidence was clearly apparent to the Respondent), makes it clear that Emmanuel Kerry was always available to be called by the Respondent as a witness in these proceedings; and should have been called as a witness in these proceedings. Moreover, the failure to call Mr Kerry is a matter that is now completely unexplained by Ms Wellard. The inference that I draw from the fact that Ms Wellard did not call Emmanuel Kerry to is that his evidence would not have helped her case in the manner now contended.
- Whilst being cross-examined, Ms Wellard’s father did also say that his daughter had been dating Emmanuel Kerry. That evidence is contrary to that given by Ms Wellard on this point. In an assessment of credit I now prefer the evidence of Mr Turner over that of his daughter. That Mr Emmanuel Kerry was involved in a romantic relationship with Ms Wellard then serves to explain the tenor of the e-mail originally sent by him to Mr Nicol in December 2014 when Mr Nicol was requested to provide a competitive quote on the job, and also lends credence to Mr Nicol’s claim that it was Emmanuel Kerry who was acting as the project co-ordinator and who did most of the negotiations regarding the project, on behalf Ms Wellard. Because of that, I infer that Ms Wellard is not well placed to give evidence regarding the discussions between Mr Nicol and Mr Kerry regarding the possibility of doing the job for $65,000 rather than $85,000, such that I should now accept the evidence of Mr Nicol, because there is nothing sufficient to contradict it. On the balance of probabilities it seems to me that Ms Wellard has merely presumed that Mr Nicol would build her extension for $65,000. I conclude that, on matters going to the formation of the contract, Ms Wellard’s evidence is now generally far less reliable than is that of Mr Nicol. Fundamentally then, I prefer the evidence of Mr Nicol when he says that the agreement was for $85,000, and that the sum of $65,000 was a matter that was only ever discussed with Mr Kerry - in a very preliminary sense - as being a theoretical possibility if certain key items were left off the specifications for the project. At the end of it, Mr Nicol says that these items were still included as part of project, and hence the reason that the parties signed a contract reflecting the higher sum. Equally, the fact of the written agreement is not now a matter that can just be blithely “glossed over” by Ms Wellard, and nor is it something that can be easily ignored by this Tribunal.
- Although the written contract contains defined progress payments, Mr Nicol says that these were not adhered to by the ME Bank, who paid the builder stage payments in accordance with their own pro-forma stages. It seems that Mr Nicol did not greatly object to that happening, given that it meant that he was being paid.
- At the end of it, Mr Nicol says that he has received 70% of the contract price, such that $25,800 still remains outstanding under the contract. I accept his evidence in that regard. Although Ms Wellard asserts that Mr Nicol has received more than this, she has not produced any evidence to demonstrate that.
- In addition to the monies outstanding pursuant to the contract, Mr Nicol also claims the following, as extras:
|QCAT filing fee:||$305.00|
- Apart from explaining that he was required to personally pay $660 to the engineer who apparently refused to come back on site and approve stages of construction (which was a necessary pre-requisite in order for Mr Nicol himself to receive a progress payment) after Emmanuel Kerry had disappeared without paying the engineer, Mr Nicol has provided very little evidence to the Tribunal in establish the legitimacy of any of these extra claims. I am told that the extra sums for windows, gutters and electrical work were for sums above the provisional sum allowances. Yet, other than some hand-written invoices from Mr Nicol claiming these amounts, there are no primary documents – in the form of plans, specifications or invoices from 3rd party suppliers – sufficient to show that these sums are, in point of fact, additional to the original contract specification.
- It seems to me from my own perusal of the plans that new gutters to the original part of the house and the installation of the kitchen were always to be included as part of the original scope of works. Even if I am wrong in thinking that, it remains the case that Mr Nicol has not shown any sufficient evidence to convince me of the contrary. Accordingly I will not here allow that part of the claim. Nor have I seen documentary evidence in relation to the additional claimed payment of $660 to the engineer; nor any evidence, (at least beyond Mr Nicol’s bare assertion) to show that $1,267.60 was incurred on ‘extra’ electrical works or $784,30 for windows, beyond the provisional sum allowance for same under the contract. These aspects of the claim are assessed by me as having not been sufficiently proven by the Applicant.
- Accordingly, the order of the Tribunal is that the Respondent will now pay to the Applicant the sum of $25,800.00, together with the QCAT filing fee of $305 (total amount $26,105.00) within 28 days.
 Jones v Dunkel (1959) 101 CLR 298.
- Published Case Name:
Nicol v Wellard
- Shortened Case Name:
Nicol v Wellard
 QCAT 260
Member McLean Williams
01 Aug 2016