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- Unreported Judgment
Keune v DJ Builders & Son Pty Ltd  QCAT 316
DJ Builders & Son Pty Ltd
8 June 2016
5 July 2016
BUILDING DISPUTE – Where jurisdiction to hear an application – Where rescission of contract – Whether characterisation of dispute as domestic building dispute or contractual matter
Queensland Building and Construction Commission Act 1991 (Qld), ss 3, 77, Schedule 2
Domestic Building Contracts Act 2000 (Qld), s 8, Schedule 2
Cox Andrews Engineers Pty Ltd v White and White  QCCTB 165
Habul v Trinity Green Pty Ltd  QCAT 198
Mr Lawrie Dore for DJ Builders & Son Pty Ltd
REASONS FOR DECISION
- This Tribunal heard this matter on 8 June 2016. On that day, a decision was handed down but reasons were not given for the decision. Reasons are now provided.
- On 1 August 2012, Stephen Keune signed a contract with DJ Builders & Son Pty Ltd (“the first contract”) to build a “three story dwelling”. Mr Keune paid DJ Builders $40,367.18 under this contract but he says only minor work was carried out on the site.
- A further contract, (“the second contract”) was signed by the parties on 3 October 2013 for the building of a similar dwelling on the same site.
- Mr Keune has applied to this Tribunal for:
- the return of the monies paid to DJ Builders under the first contract;
- damages for negligent misrepresentation and/or misleading or deceptive conduct;
- damages for distress, trauma and failure to proceed with the works diligently, in an appropriate and skilful way and with reasonable care and skill;
- damages for failure to provide an intercom to the front door as required by the contract.
In support of his application, Mr Keune filed copies of emails between the parties concerning the rescission of the first contract and a one page, short statement from Mr Keune. The statement essentially set out the history of the contracts.
- DJ Builders filed a reply saying the first contact became frustrated by the actions of a third party and was subsequently discharged by mutual agreement as evidenced by the email of 19 July 2013. DJ Builders filed no further statements of evidence in this matter but did file submissions in response to Mr Keune’s claim.
- At the hearing, both parties gave oral evidence on the circumstances that led up to the agreed rescission of the first contract.
- Mr Dore, on behalf of the company, said as follows:
- The first house was unbuildable because approval was withdrawn by Council. Mr Dore said this is most unusual. The neighbours complained and the approval was rescinded;
- The plans had to be re-drawn to comply with Council requirements;
- As a result, when the second contract was entered into, there were two cost bases from the first contract factored into the second contract. The first was transferable costs – that work already done that could be used for the second contract, e.g. excavation already undertaken. The second base was costs simply lost – things unusable again e.g. town planning costs and the cost of drafting that had to be redone;
- These costs were taken into account by DJ Builders when costing the second contract and the rescission agreement was expressed in the email of 19 July 2013 as a “this is it” agreement “with no further costs to either party” stipulated.
- Mr Keune agrees the first contract was rescinded by the parties as recorded in the email of 19 July 2013.
- However, Mr Keune further says as follows:
- Mr Dore told him there was an allocation in the second contract of the costs for works carried out under the first contract that could be re-used under the second contract and that Mr Keune wasn’t charged for work already done under the first contract;
- Mr Keune still believed that there were costs paid under the first contract for nothing achieved;
- Mr Keune was not aware of the different costs breakup.
- Mr Keune’s version of the events regarding the first contract pertinent to the rescission are as follows:
- The building approval was cancelled by the Council because the Council required an operation works permit (Mr Keune did not know what that was);
- The excavation was up against the neighbour’s boundary;
- Mr Keune saw emails from the neighbour raising complaints and he was aware of 28 objections to the plans received from the neighbours and others.
- In particular, Mr Keune said the plans under the first contract were submitted to Council in November 2011, after which they were adjusted to receive development approval. The first contract was signed in 2012 to build the dwelling based on the plans that had received development approval. The builder then sought building approval. This was obtained, but then cancelled after Council received the complaints.
- Mr Keune says the second contract was signed by the parties on 3 October 2013.
Does the Tribunal have jurisdiction to hear this application?
- A domestic building dispute includes a claim or dispute arising between a building owner and a building contractor relating to the performance of reviewable domestic work or a contract for the performance of reviewable domestic work.
- A contract is defined under the Queensland Building and Construction Commission Act 1991 (Qld) (as it then was) for Part 7 of that Act as ”a contract for carrying out tribunal work”.
Is this a domestic building dispute?
- The objects of the Queensland Building and Construction Commission Act are set out in section 3 of that Act. They are:
- (a)to regulate the building industry—
- (i)to ensure the maintenance of proper standards in the industry; and
- (ii)to achieve a reasonable balance between the interests of building contractors and consumers; and
- (b)to provide remedies for defective building work; and
- (c)to provide support, education and advice for those who undertake building work and consumers; and
- (d)to regulate domestic building contracts to achieve a reasonable balance between the interests of building contractors and building owners.
- A domestic building dispute includes a dispute relating to a contract for the performance of reviewable domestic work.
- Both parties agree the dwelling was built under the second contract and defects resolved under that contract – except perhaps for the intercom installation and any ongoing defects that emerge.
- I respectfully adopt and follow the comments of the learned Senior Member in Habul v Trinity Green Pty Ltd  in so far as it is necessary. In that decision the learned member agreed with the comments of the member in Cox Andrews Engineers Pty Ltd v White and White in that there must be some nexus between the work complained of and domestic building work as defined.
- I am satisfied that both parties intended to rescind the first contract. However, there appears to be uncertainty as to the terms or conditions of the agreement to rescind. Mr Dore clearly believes it was an “all up settlement” with the recoverable costs from the first contract factored into the second.
- Mr Keune does not agree with this.
- Having considered the evidence of the parties and the objects of this Act, I am satisfied the complaint revolves around the rescinding of a contract for domestic building work, not actual building work.
- The aim of this application does not accord with the objects of this Act. In all the circumstances, I am not comfortably satisfied that there is the requisite nexus between the complaint and domestic building work as defined. The dispute is not one in relation to defective building work or indeed building work. It is a contractual dispute in relation to the terms of the rescission.
- I am satisfied that this application is not a domestic building dispute relating to or associated with a contract for the performance of reviewable domestic work.
- If I am wrong about that, neither party, but particularly Mr Keune, has provided any evidence upon which the facts of this matter could be determined. Even if there was a domestic building dispute, there is no evidence sufficient for there to be findings of fact. For this reason alone, the application must, in any event, fail.
Claims for damages
- Mr Keune seeks damages for negligent misrepresentation and/or misleading or deceptive conduct, for distress, trauma and failure to proceed with the works diligently, in an appropriate and skilful way with reasonable care and skill and damages for failure to provide an intercom to the front door as required by the second contract.
- At the outset of the hearing, Mr Keune agreed that if I found the essential issue to be that of the rescission of the contract, QCAT did not have jurisdiction in the matter. This means I cannot determine most of the damages claims he makes arising from a domestic building dispute.
- All of these damages, (except for the failure to provide an intercom) relate to the first contract and can be in part, characterised as being in the nature of pain and suffering - claims that are outside the jurisdiction of this Tribunal. As I have also been satisfied that this application is not in respect of a domestic building dispute or relating to the performance of reviewable domestic work or a contract for the performance of reviewable domestic work, the claims said to arise under the first contract must also fail.
- Again, if I am wrong about that, Mr Keune has provided no quantifiable evidence to assess any potential damages claims other than what he thought was reasonable in the circumstances and an allowance for rent. For this reason, any damages application based on the first contract application must fail.
Lack of Intercom in the house under the second contract
- I am satisfied that this is a matter for this Tribunal. However, this issue was settled by negotiation by the parties prior to the hearing and a consent order was made in relation to it.
 See submission of Applicant dated 29 February received by the Tribunal on 7 March 2016, para .
 Queensland Building and Construction Commission Act 1991 (Qld) s 77.
 Ibid, Schedule 2 definition of ‘building dispute’.
 Ibid, Schedule 2 definition of ‘domestic building dispute’.
 Ibid, Schedule 2 definition of ‘reviewable domestic work’.
 Domestic Building Contracts Act 2000 (Qld), ss 8(1) and (3).
 Queensland Building and Construction Commission Act 1991 (Qld) Schedule 2.
  QCAT 198 at para .
  QCCTB 165.
- Published Case Name:
Keune v DJ Builders & Son Pty Ltd
- Shortened Case Name:
Keune v DJ Builders & Son Pty Ltd
 QCAT 316
05 Jul 2016