Queensland Judgments
Authorised Reports & Unreported Judgments
  • sclq logo
  1. Caselaw
  2. QCA
  3. 2024
  4. Allen v Queensland Building and Construction Commission - [2024] QCA 24

Authorised Reports & Unreported Judgments
Exit Distraction Free Reading Mode
  • Selected for Reporting - See Editor's Note
  • Appeal Determined (QCA)

Allen v Queensland Building and Construction Commission[2024] QCA 24

Allen v Queensland Building and Construction Commission[2024] QCA 24

SUPREME COURT OF QUEENSLAND

CITATION:

Allen & Anor v Queensland Building and Construction Commission [2024] QCA 24

PARTIES:

REECE JUSTIN ALLEN

CHANTELL RENEE MARIA TAYLOR

(applicants)

v

QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION

(respondent)

FILE NO/S:

Appeal No 8605 of 2023

QCATA No 91 of 2020

DIVISION:

Court of Appeal

PROCEEDING:

Application for Leave to Appeal – Queensland Civil and Administrative Tribunal Act 2009 (Qld)

ORIGINATING COURT:

Queensland Civil and Administrative Appeals Tribunal at Brisbane – [2023] QCATA 66 (Judicial Member D J McGill SC)

DELIVERED ON:

1 March 2024

DELIVERED AT:

Brisbane

HEARING DATE:

5 February 2024

JUDGES:

Mullins P, Bond JA and Williams J

ORDER:

The application for leave to appeal is refused, with costs.

CATCHWORDS:

ADMINISTRATIVE LAW – STATUTORY APPEALS FROM ADMINISTRATIVE AUTHORITIES TO COURTS – where the applicants terminated a construction contract for the construction of their home – where the applicants advanced an insurance claim against the respondent under the Home Warranty Insurance Scheme established under Part 5 of the Queensland Building and Construction Commission Act 1991 (Qld) – where the respondent rejected the claim on the basis the applicants failed to demonstrate the contract had been properly terminated – where the applicants contended they had properly terminated pursuant to a contractual show cause procedure, or alternatively at common law – where the applicants sought review of the respondent’s decision pursuant to s 20 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) – where the Tribunal and subsequently the Appeal Tribunal confirmed the respondent’s rejection of the claim – where s 150(3)(a) of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) provides that an appeal to the Court of Appeal from a final decisions of the Appeal Tribunal may be made “only on a question of law” and only if leave is obtained – where principles guiding the exercise of the discretion to grant leave discussed – where none of the proposed grounds of appeal were appeals only on questions of law

Queensland Building and Construction Commission Act 1991 (Qld), Schedule 1B

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 150

Chopra v Department of Education and Training (2019) 60 VR 505; [2019] VSCA 298, cited

Commissioner of Police v Antoniolli [2021] QCA 237 considered

Crime and Corruption Commission v Andersen [2021] QCA 222 considered

Dura (Australia) Constructions Pty Ltd v Hue Boutique Living Pty Ltd (No 3) [2012] VSC 99, applied

FPM Constructions Pty Ltd v Council of the City of Blue Mountains [2005] NSWCA 340, distinguished

Hayes v Federal Commissioner of Taxation (1956) 96 CLR 47; [1956] HCA 21, considered

Hometeam Constructions Pty Ltd v McCauley [2005] NSWCA 303, cited

Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115; [2007] HCA 61, cited

Pivovarova v Michelsen (2019) 2 QR 508; [2019] QCA 256, applied

Shepherd v Felt & Textiles of Australia Ltd (1931) 45 CLR 359; [1931] HCA 21, cited

COUNSEL:

R J Allen, of Project Legal, on behalf of himself and the other applicant

S E Seefeld for the respondent

SOLICITORS:

R J Allen, of Project Legal, on behalf of himself and the other applicant

Queensland Building and Construction Commission – Legal for the respondent

  1. [1]
    THE COURT: The appellants (who, for reasons which will appear, will be referred to as the applicants) had sought to develop, design and construct a home in Brisbane. They engaged a contractor to construct the house but ultimately terminated the contract which they had with the contractor when the home was about 70% complete. The contractor disputed the applicants’ entitlement to terminate, treated the applicants’ conduct as itself repudiatory, and terminated the contract itself.
  2. [2]
    The male applicant is a legal practitioner. He represented the applicants both in this Court and below.
  3. [3]
    After terminating the contract, the applicants advanced an insurance claim against the respondent under the Home Warranty Insurance Scheme established under Part 5 of the Queensland Building and Construction Commission Act 1991 (Qld). That insurance scheme would permit recovery for loss which the applicants suffered in the event of the contractor failing to complete the contract, but only if they had “properly terminated the contract with the contractor”. They would be regarded as having “properly terminated” within the meaning of the insurance scheme if they could be regarded as having “lawfully under the contract or otherwise at law” terminated upon the contractor’s default, including but not limited to any breach of contract by the contractor.
  1. [4]
    The applicants claimed that they had properly terminated the contract, relying both on having properly established a contractual right to terminate pursuant to a contractual show cause procedure and on an alleged entitlement to terminate the contract at common law.
  2. [5]
    The respondent rejected the insurance claim on the basis that the applicants had failed to demonstrate that the contract had been properly terminated. The respondent’s opinion was that there had been insufficient basis for the applicants to have exercised a contractual right to terminate pursuant to the contractual show cause notice procedure. Furthermore, the respondent said that it had been unable to identify evidence on which to show any appropriate basis for the contract to have been terminated at common law.
  3. [6]
    The applicants sought to review the respondent’s decision by a review conducted under s 20 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (the QCAT Act). Under such a review the Tribunal is required to produce the correct and preferable decision by way of a fresh hearing on the merits. By a written judgment published on 27 February 2020, the Tribunal, constituted by Member Oliver, decided to confirm the respondent’s rejection of the applicants’ claim.[1]
  4. [7]
    The applicants advanced an appeal to the QCAT Appeal Tribunal constituted by Judicial Member McGill SC. Pursuant to s 142 of the QCAT Act insofar as the appeal was on a question of fact, or a question of mixed law and fact, the applicants required leave to appeal. Leave was not required for an appeal on a question of law. If leave to appeal was granted on a question of fact, or on a question of mixed law and fact, pursuant to s 147 of the QCAT Act the appeal would be by way of rehearing, albeit with the power of the Appeal Tribunal to admit additional evidence.
  5. [8]
    Before the Appeal Tribunal the applicants contended that the Tribunal had made 79 errors of law and 43 errors of fact.
  6. [9]
    By a written judgment published on 15 June 2023, the Appeal Tribunal rejected the applicants’ attempt to overturn the decision of the Tribunal and relevantly ordered:[2]
  1. “1.
    So far as the appeal was on questions of law, the appeal is dismissed.
  1. 2.
    Leave to appeal on questions of fact or mixed fact and law granted, limited to the issues of whether the appellants were in the circumstances entitled to terminate the building contract at common law for repudiation, or for sufficiently serious breaches of non-essential terms; otherwise leave to appeal refused.
  1. 3.
    Appeal by leave dismissed.”
  1. [10]
    Section 150(3) of the QCAT Act provides:
  1. “150
    Party may appeal—decisions of appeal tribunal
  1. (1)
    A person may appeal to the Court of Appeal against a decision of the appeal tribunal to refuse an application for leave to appeal to the appeal tribunal.
  1. (2)
    A party to an appeal under division 1 may appeal to the Court of Appeal against the following decisions of the appeal tribunal in the appeal—
  1. (a)
    a cost-amount decision;
  1. (b)
    the final decision.
  1. (3)
    However, an appeal under subsection (1) or (2) may be made—
  1. (a)
    only on a question of law; and
  1. (b)
    only if the party has obtained the court’s leave to appeal.”
  1. [11]
    Pursuant to s 151 of the QCAT Act, any application for leave to appeal from the decision of the Appeal Tribunal is required to be made by application under the Uniform Civil Procedure Rules within 28 days of the applicants being given the written reasons of the Appeal Tribunal.[3] Such an application should be made using form 69 “Application to Court of Appeal”.[4] Use of that form requires applicants specifically to identify reasons justifying a grant of leave. Appropriate material should be set out in a supporting affidavit, which would in the normal course also exhibit a proposed notice of appeal.
  2. [12]
    On 12 July 2023 the applicants filed a notice of appeal which purported to institute an appeal from the final decision of the Appeal Tribunal which had been delivered on 15 June 2023. However, the appeal to this Court had not been instituted properly because the applicants had not obtained the Court’s leave to appeal. The applicants’ purported notice of appeal sought an order that leave to appeal be granted, but that course was irregular.
  3. [13]
    In order now to comply with the applicable procedural law, the applicants would be required to file an application which sought the leave they needed and which also sought an order extending the time within which the application was required to be filed. Instead of taking that course, the applicants invited the Court to overlook their procedural errors and to treat the notice of appeal as an application for leave to appeal on the grounds identified in the notice of appeal. The respondent was content to take that course. The parties invited the Court to hear argument on both the application and on the merits of the appeal at the same time.
  4. [14]
    For the reasons which follow, leave to appeal should be refused in relation to each of the proposed grounds of appeal.

Legal principles governing the application

  1. [15]
    Two important aspects of the law must be identified at the outset.
  2. [16]
    First, leave to appeal may only be granted if the proposed appeal is “only on a question of law”: s 150(3)(a). In Pivovarova v Michelsen[5] and in a number of subsequent decisions,[6] this Court has determined that, on the proper construction of the QCAT Act, appeals from the Appeal Tribunal pursuant to s 150 must be confined to pure questions of law and only to such questions. This Court has no jurisdiction to consider an appeal from a final decision of the Appeal Tribunal on a question of fact or on a mixed question of fact and law.
  3. [17]
    The applicants submitted in writing that this Court should overrule the Pivovarova line of decisions by reference to High Court decisions in different contexts which predated Pivovarova but which were not specifically adverted to in that case. In the course of oral argument, the male applicant resiled from that position, but immediately advanced an argument directly inconsistent with Pivovarova by contending that an appeal on a question of mixed law and fact could be regarded as an appeal on a question of law “if … appropriately framed.”[7]
  4. [18]
    Whether it is couched as an attempt to overrule Pivovarova or as an attempt to reinterpret it, the submission must be rejected. The reasons of Fraser JA specifically considered and distinguished the earlier decision of the Full Court of the Federal Court of Haritos v Commissioner of Taxation[8] which itself had analysed many of the cases on which the applicants now rely. Further, any contention that this Court should depart from earlier decisions as to the proper construction of legislation must persuade the Court to have a strong conviction that the earlier decisions are wrong.[9] The applicants’ submission does not so persuade the Court. To the contrary, we agree with the reasons advanced by Fraser JA in Pivovarova.
  5. [19]
    The distinction between an appeal only on a question of law, on the one hand, and an appeal on a question of fact or on a mixed question of fact and law, on the other hand, is absolutely fundamental in the present context. It goes to the jurisdiction of this Court to entertain an appeal from the Appeal Tribunal. An appeal which must be “only on a question of law” is of a narrower ambit than an appeal in which a question of law is merely “involved”[10]. In order to be an appeal which this Court has jurisdiction to hear, the very subject matter of the appeal must be a question of law.
  1. [20]
    Unfortunately, a failure to grapple with this limitation in accordance with the law permeated the whole of the applicants’ written and oral argument. References were made to many cases in different contexts but which were not relevant to the present context. The applicants’ argument complained of errors below but without making the distinction which the law requires between appeals only on a question of law, and other appeals which allege factual error or error of mixed fact and law and in which legal error might merely be somehow involved. In applications of this nature, it is for the applicant and not this Court to formulate a ground of appeal which this Court would have jurisdiction to consider. For the most part, the applicants failed in this task.
  2. [21]
    Second, even if a proposed appeal from a final decision of the Appeal Tribunal is only on a question of law, an applicant still needs leave to appeal to this Court. In Crime and Corruption Commission v Andersen this Court recently observed of the s 150 discretion to grant leave:[11]
  1. “The identification that the proposed appeal raises a question of law is not sufficient to warrant a grant of leave. An exercise of judicial discretion is involved. The matters which authority has identified as relevant to the exercise of that discretion include:
  1. (a)
    whether there is a reasonable argument that there is an error of law to be corrected; and
  1. (b)
    whether leave is necessary to correct a substantial injustice, or an important point of principle sufficient to warrant the grant of leave has been identified.”
  1. [22]
    Note should be taken of the use of the word “include” in the chapeau to the quote in the previous passage. Cases in this Court which have addressed the analogous statutory discretion to grant leave to appeal to a party dissatisfied with the judgment of the District Court in its appellate jurisdiction pursuant to s 118(3) of the District Court of Queensland Act 1967 (Qld), have counselled against reducing the discretion to the application of hard and fast rules. In Commissioner of Police v Antoniolli[12] after a consideration of relevant authorities, Bond JA summarised the position in relation to the s 118(3) discretion in the following way:
  1. “The discretion is unfettered, and exercisable according to the nature of the case, but leave to appeal will not be granted lightly, given that the applicant has already had the benefit of two judicial hearings.
  1. It will usually be necessary – but not sufficient – that the Court be persuaded that there is a reasonable argument that there is an error to be corrected, which, if corrected would justify the applicant’s claim for relief.
  1. Tests which provide useful guidance as to the nature of the additional consideration over and above the existence of a reasonable argument that there is an error to be corrected include:
  1. (a)
    that leave is necessary to correct a substantial injustice;
  1. (b)
    that the proposed appeal raises an important point of law or principle; and
  1. (c)
    that the proposed appeal raises a question of general or public importance.”
  1. [23]
    Having regard to the s 118(3) analogy and the position in Pivovarova outlined above, a more complete summary of the principles guiding the s 150(3)(b) discretion in relation to appeals from final decisions of the Appeal Tribunal may be essayed:
  1. (a)
    Leave to appeal may only be granted if the proposed appeal is only on a question of law in the sense discussed in Pivovarova.
  1. (b)
    The discretion is otherwise unfettered, and exercisable according to the nature of the case, but leave to appeal will not be granted lightly, given that the applicants have already had the benefit of two hearings in QCAT.
  1. (c)
    It will usually be necessary – but not sufficient – that the Court be persuaded that there is a reasonable argument that there is an error of law to be corrected, which, if corrected, would justify the applicant’s claim for relief.
  1. (d)
    Tests which provide useful guidance as to the nature of the additional consideration over and above the existence of a reasonable argument that there is such an error of law to be corrected include –
  1. (i)
    that leave is necessary to correct a substantial injustice; and
  1. (ii)
    that the proposed appeal raises a question of law of general or public importance.
  1. [24]
    It will assist in understanding the gravamen of the proposed grounds of appeal if the way in which the case was resolved at first instance by Member Oliver and on appeal by Judicial Member McGill SC is first briefly described.

Factual background

  1. [25]
    The contract between the applicants and their contractor was entered into by them on 17 February 2016.  It provided for the construction of a residential dwelling for a contract price of $1,896,000. The firm of architects who had assisted in the design of the house were the nominated Superintendent under the contract.
  2. [26]
    Work commenced in March 2016 and progressed thereafter but not without difficulty. There were delays and the contractor had sought extensions of time under the contract. There were also numerous occasions when the contractor needed clarification of some aspects of the design drawings, resulting in requests for information/clarification from the Superintendent to enable the project to proceed.
  1. [27]
    By 10 November 2017 the work was about 70% complete, but there was still considerable finishing work to be carried out. However, the relationship between the applicants and their contractor had deteriorated. The male applicant was concerned about the standard of work, the progress of the works, the fact that practical completion would not be reached within the time specified by the contract taking into account agreed extensions of time, the need for further extensions of time and the fact that the contractor had engaged some subcontractors without prior written approval of the Superintendent.
  2. [28]
    As a consequence of these concerns, the applicants issued a notice to show cause under clause 39 of the contract. That clause relevantly provided:
  1. “39.1
    Preservation of other rights
  1. If a party breaches (including repudiates) the Contract, nothing in this clause shall prejudice the right of the other party to recover damages or exercise any other right or remedy.
  1. 39.2
    Contractor's default
  1. If the Contractor commits a substantial breach of the Contract, the Principal may, by hand or by certified post, give the Contractor a written notice to show cause.
  1. Substantial breaches include, but are not limited to:
  1. a)
    failing to:
  1. i.
    provide security;
  1. ii.
    provide evidence of insurance;
  1. iii.
    comply with a direction of the Superintendent pursuant to sample clause 29.3; or
  1. iv.
    use the materials or standards of work required by the Contract;
  1. b)
    wrongful suspension of work;
  1. c)
    substantial departure from a construction programme without reasonable cause or the Superintendent’s approval;
  1. d)
    where there is no construction program, failing to proceed with due expedition and without delay; and
  1. e)
    in respect of [the clause dealing with payment of workers and subcontractors], knowingly providing documentary containing an untrue statement
  1. 39.3
    Principal's notice to show cause
  1. A notice under subclause 39.2 shall state:
  1. a)
    that it is a notice under clause 39 of these General Conditions of Contract;
  1. b)
    the alleged substantial breach;
  1. c)
    that the Contractor is required to show cause in writing why thePrincipal should not exercise a right referred to in subclause 39.4:
  1. d)
    the date and time by which the Contractor must show cause (which shall not be less than 7 clear days after the notice is received by the Contractor): and
  1. e)
    the place at which cause must be shown.
  1. 39.4
    Principal's rights
  1. If the Contractor fails to show reasonable cause by the stated date and time, the Principal may by written notice to the Contractor:
  1. a)
    take out of the Contractor’s hands the whole or part of the work remaining to be completed and suspend payment until it becomes due and payable pursuant to subclause 39.6; or
  1. b)
    terminate the Contract.”
  1. [29]
    The contractor responded to the applicants’ notice to show cause by the due date. However, the applicants considered that the response was not satisfactory and formed the view that they were within their rights to elect to terminate under cl 39.4(b). Accordingly on 21 November 2017 the applicants terminated the contract.
  2. [30]
    On 1 December 2017 the contractor by its solicitors rejected the proposition that the contractor was in substantial breach; asserted that the contractor had provided a satisfactory response to the notice to show cause, treated the applicants’ termination as a repudiation of the contract and elected to terminate the contract itself. The contractor did not return to site or carry out any further building work.
  3. [31]
    As previously mentioned, the applicants contended that they had properly terminated the contract and advanced a claim on the respondent under the statutory insurance scheme. The respondent rejected the claim on the basis that the contract had not been properly terminated.
  4. [32]
    Termination on the basis of an inadequate response to a notice to show cause was not the only basis on which the applicants had sought to justify their termination. Before the Tribunal the applicants also contended that after they took possession of the site they found further evidence of defective building work which they said amounted to substantial breaches of contract justifying their termination of the contract under the general law. In this regard they relied on the preservation of their rights expressed in cl 39.1 and on Shepherd v Felt & Textiles of Australia Ltd.[13]
  5. [33]
    Member Oliver examined the operation of the statutory insurance scheme. He identified that the policy would respond only if the insured had “properly terminated” the contract with the contractor and noted that that phrase was defined in the policy as “lawfully under the contract or otherwise at law, upon the contractor’s default which extends to, but is not limited to … (d) any breach of the contract by the contractor.”
  1. [34]
    Member Oliver then proceeded to consider whether the applicants had persuaded him that they had properly terminated the contract in that sense.
  2. [35]
    First, he proceeded to consider the validity of the applicants’ termination under cl 39.4.
  3. [36]
    He concluded that the Tribunal was required to determine on an objective assessment of the conduct of the whether the contractor had been in substantial breach of contract as alleged by the applicants. Although he accepted that a “substantial breach” within the meaning of cl 39.2 did not have to be such a breach as would justify common law determination, he found persuasive observations by Dixon J in Dura (Australia) Constructions Pty Ltd v Hue Boutique Living Pty Ltd (No 3)[14] and concluded that on the proper construction of the contract the use of the adjective “substantial” provided guidance. He concluded that that the breaches concerned should not be trivial or inconsequential but should rather be of real or actual significance to the important qualities of the bargain.
  4. [37]
    He concluded that under cl 39 the principal did not merely have to establish that the alleged breach was a substantial breach, but also that the response to the alleged breach was not a reasonable response by the contractor. He thought that an objective test applied to the question whether the response was a reasonable response. In this regard he found that the factual circumstances giving rise to the issuing of the notice may well be relevant to a consideration of whether the response to it was reasonable. Further he concluded that in making the decision whether or not to terminate based on an alleged unreasonable response by the contractor, the applicants were the subject of an obligation to make that decision honestly and in good faith.
  5. [38]
    Member Oliver then proceeded to address the circumstances attending each of the alleged substantial breaches identified in the notice to show case and the nature of the contractor’s response to the notice. As to this:
  1. (a)
    He addressed ground 1, which had raised complaints concerning the contractor having failed to use materials or standards of work as required by the contractor. Specific issues had been raised concerning, the standard of plasterwork, the size of door W3.09 and the visual characteristics of the rooftop terrace concrete hobs.
  1. (b)
    He addressed grounds 2, 3 and 6 which had raised complaints that the contractor had failed to proceed with due expedition and without delay; had failed to carry out the work with reasonable diligence and had failed to ensure that the works reach practical completion by the agreed practical completion date.
  1. (c)
    He addressed ground 4 in which the applicants claimed that the contractor had made a number of claims for payment to which it was not entitled.
  1. (d)
    He addressed ground 5 which particularised two occasions in which the contractor had engaged subcontractors without the specific approval of either the applicants or the Superintendent.
  1. (e)
    He summarised his analysis in this way:
  1. (i)
    Insofar as breaches had been identified they were not substantial breaches within the meaning of cl 39; and
  1. (ii)
    When looked at objectively, particularly when the works were 70% complete with further work to do to bring the whole project together, the contractor’s responses were reasonable in that they addressed the applicants’ concerns and were not so inadequate that they gave rise to a right to terminate the contract.
  1. [39]
    Member Oliver then proceeded to address the applicants’ submission that if the Tribunal was satisfied that the contractor had provided a satisfactory response to the notice to show cause, then there still remained a right to terminate the contract at common law. As to this:
  1. (a)
    Member Oliver addressed a submission that the contractor’s behaviour over the contract had evinced such a disregard of its contractual obligations as to amount to repudiation on the basis that it would convey to a reasonable person standing in the shoes of the applicants renunciation either of the contract as a whole or of a fundamental obligation under it. He rejected the submission, finding that it flew in the face of what actually occurred and indeed the nature of the response which had been made to the show cause notice. He found that the contractor had not acted in any way which would constitute repudiatory conduct and therefore at the time the applicants issued the notice to show cause and at the time of the contractor’s response, the contractor was ready, willing and able to continue to perform its obligations under the contract.
  1. (b)
    He then addressed a submission that the defects identified in the notice to show cause and the defects later identified were so substantial as to justify termination at common law. He considered on the one hand the evidence contained in the statement of the male applicant and the expert engaged by him, and, on the other, the evidence adduced from the contractor’s representative. After addressing a multiplicity of specific issues he concluded:

“Having considered all of the grounds of termination put forward by the applicants, I am not satisfied that individually or collectively, they constitute a substantial breach that would give rise to a right of termination. What is critical to a consideration of each of those items is that the works were only 70% complete and further work was to be done to bring the works to practical completion. To go on site in a partially constructed building and pick selective items which would normally be attended to during completion of the works and contend that they are substantial defects is particularly unfair to the contractor, where in every case, there is an explanation as to why the works are in the state that they are in, in particular the selected items identified by the applicants, and also in circumstances where the contractor was ready, willing and able to complete the building project.”[15]

  1. [40]
    Having conducted an analysis of all the ways in which the applicants sought to persuade him that they had properly terminated the contract, and rejected them, Member Oliver confirmed the decision which the respondent had made to reject the insurance claim.
  1. [41]
    Despite the multiplicity of appeal grounds which the applicants sought to advance on appeal to the Appeal Tribunal, Judicial Member McGill SC did not overturn any of the findings of fact and law made below.[16] He was persuaded to grant leave to appeal only on the question of whether, taking into account the extent of an encroachment over the side boundary of the concrete shown to have occurred by fresh evidence admitted on appeal, the applicants were entitled to and did terminate the building contract at common law, for either repudiation or sufficiently serious breaches of non-essential terms.
  2. [42]
    On the question of termination for repudiation, the Judicial Member said that a previous decision in which various aspects of a builder’s conduct had justified the conclusion of repudiation[17] stood:

“… as a very marked contrast to the present case, where the only significant defects were the encroachment onto the neighbouring land, the absence of backblocking in parts of the plaster ceilings, and to a lesser extent water penetration through inadequately sealed windows. There were some additional minor matters, but on the whole they do not show either a refusal, or an inability, to perform the contract other than in a manner substantially inconsistent with its terms. Applying the approach in the authorities referred to earlier, in my opinion the behaviour of the builder in the present case has not been shown to have amounted to repudiation of the contract, so as to give rise to an entitlement to terminate on that basis at common law.”[18]

  1. [43]
    On the question of termination for sufficiently serious breaches of non-essential terms, the Judicial Member concluded:

“As for the alternative ground, on the basis of a collection of breaches amounting to sufficiently serious breaches of non-essential terms, I do not consider that the breaches of contract which have been demonstrated, taken together, amount to a sufficiently serious set of breaches of non-essential terms to entitle the appellants to terminate on that basis at common law, since they did not deprive the appellants of a substantial part of the benefit which they were entitled to under the contract. I consider that damages were an adequate remedy for such breaches as have been proved by the appellants. It follows that, on this basis as well, the appellants were not entitled to terminate the building contract at common law.”[19]

  1. [44]
    Accordingly, the Judicial Member concluded that there was no reason to interfere with the conclusion of the Member that the applicants had not validly terminated the contract with the builder, and accordingly the decision of the respondent to reject their claim under the insurance policy was correct.
  2. [45]
    To the extent it is necessary to explain any further the approach taken to relevant issues by the Appeal Tribunal, we will do so in relation to the relevant proposed grounds of appeal below.

The proposed grounds of appeal

  1. [46]
    Against the foregoing background it is necessary to address the question of leave to appeal in relation to each of the proposed grounds of appeal. It is convenient to group some of the proposed grounds of appeal together.
  2. [47]
    We have explained that the applicants’ submissions failed to grapple properly with the significance of the limitation that any appeal must be only on a question of law. In the course of written and oral submissions premised on this wrong starting point, many suggestions of error below were made. On the question of whether there should be leave to appeal, we will limit our consideration to the grounds which were formulated and for which, albeit irregularly, leave was sought. As it is not this Court’s role to seek to formulate appeal grounds which might comply with the law, we will not otherwise seek to deal with all the various contentions of error which were mentioned.

Proposed ground 1

  1. [48]
    The proposed ground of appeal was in these terms:
  1. “1.
    The Appeal Tribunal erred in finding [the Contract] was not “properly terminated” by the Applicants, as that term is defined in Part 11 of Edition 8 of the Respondent's Insurance Policy Conditions.”
  1. [49]
    The applicants relied heavily on the observations by Fullagar J in Hayes v Federal Commissioner of Taxation[20] that “where all the material facts are fully found, and the only question is whether the facts are such as to bring the case within the provisions properly construed of some statutory enactment, the question is one of law only”.
  2. [50]
    His Honour’s observation has itself been the subject of significant qualification and explanation in other subsequent decisions.[21] In the present context this Court[22] recently referred with approval to the summary expressed by the Victorian Court of Appeal in Chopra v Department of Education and Training:[23]

“The principles for distinguishing between questions of law, questions of fact and mixed questions of law and fact are well established. However, those principles are difficult to apply in practice. What is the proper meaning, as a matter of construction, of a statutory provision is usually a question of law. Ordinarily, whether facts fully found fall within a statutory provision, properly construed, is a question of law. However, where a statute uses words according to their ordinary meaning and it is reasonably open to hold that the facts as found fall within those words, the question whether they do or not is one of fact.”

  1. [51]
    It is unnecessary to explore the operation of the categorization because this is not a case where the applicants accepted that all the material facts sounding on the question were fully found below. In very many respects the applicants challenged the fact finding below referable to the question whether the contract had been properly terminated. Notably, in Robb v Tunio[24] Jackson J (with whom Muir JA and Martin J agreed) observed that findings on evidence and the determination of facts based upon the totality of evidence before a tribunal, are not only questions of law and an appeal from such a decision does not raise only a question of law.
  2. [52]
    By the proposed appeal ground presently under consideration, the applicants seek to have this Court make different findings on questions of fact and mixed fact and law referable to the ultimate question whether the contract had been properly terminated. Then having reached a different evaluation on those questions, the applicants would invite this Court to reach a different conclusion on the ultimate question. The applicants’ case on the first proposed ground of appeal could not be characterised as an appeal only on a question of law.
  3. [53]
    We would refuse leave to appeal on proposed ground 1.

Proposed ground 2a

  1. [54]
    This proposed ground of appeal was in these terms:
  1. “2.
    The Appeal Tribunal erred in finding the contract was not lawfully terminated by the Appellants under the Contract upon [the contractor’s] default for:
  1. a.
    failing to use the materials or standards of work required by the Contract (Clauses 29.1[25], 29.3[26], 39.2 a) iv) / ss. 22 and 23 of Schedule lB of the Queensland Building and Construction Commission Act 1991 (Qld)) (Schedule 1B) and Clause 11.1[27]);”
  1. [55]
    Leave to appeal on this ground must be refused for the reasons expressed in relation to ground 1. The appeal ground is only slightly less general than that expressed in relation to ground 1, focussing as it does on a particular category of breaches of contract, but that does not avoid the existence of the same flaws.
  2. [56]
    The observations just made are sufficient to justify refusal of leave. But additional points can be made further explaining why it would be wrong to grant leave for this proposed appeal ground.
  3. [57]
    First, the applicants sought to persuade this Court to accept that on the proper construction of cl 39.2 any single failure to use the materials or standard of work required by the Contract, no matter how insignificant or readily remediated should be regarded as a substantial breach of contract justifying engagement of the show cause procedure and possible termination.
  1. [58]
    But that construction of the clause is not reasonably arguable. We observe:
  1. (a)
    The chapeau to cl 39.2 confers on the principal a conditional right to give a notice to show cause.
  1. (b)
    The condition is that described in the opening clause “If the Contractor commits a substantial breach of the Contract”. Whether the condition is satisfied is something which must be objectively assessed. Thus, if there is a breach but that breach does not fall within the meaning of “substantial breach”, then the condition is not satisfied, and the principal has no right to give the notice.[28]
  1. (c)
    “Substantial breach” is defined in an inclusive way. Member Oliver was correct to conclude that the use of the adjective “substantial” provided guidance.
  1. (d)
    Here the applicants look to the definition of “a) failing to … use the materials or standards of work required by the Contract.” But in that clause “failing” is used as a present participle verb and should be taken to refer to a continuity of failure. One trivial breach would not establish the requisite continuity of failure.
  1. (e)
    That is not to say that a single failure to use the required materials or standards of work might not amount to a “substantial breach”, but, if it did, that would be because it fell within the ordinary and natural meaning of that phrase and not the extended definition.
  1. [59]
    Second, any evaluation by the Tribunal or the Appeal Tribunal of the evidence of breach on which the applicants relied to reach a conclusion on whether the breach was or was not a substantial breach was a decision by them on a mixed question of fact and law. The present appeal ground which invites this Court to reach a different conclusion on that question cannot be regarded as an appeal only on a question of law.
  2. [60]
    Third, even if, contrary to our view, there was a reasonable argument that there was an error of law to be corrected in the interpretation given to what was a “substantial breach”, that error would go nowhere unless there was also a reasonable argument that there was an error of law to be corrected in the approach take to the question whether the contractor had shown reasonable cause in its response to the show cause notice. As to this:
  1. (a)
    The chapeau to cl 39.4 confers on the principal a conditional right to terminate.
  1. (b)
    The condition is that described in the opening clause “If the Contractor fails to show reasonable cause”. Those words assume the existence of a valid notice and then would require an assessment of the contractor’s response.
  1. (c)
    The applicants contended that the question whether the contractor had succeeded to show reasonable cause was not something which must be objectively assessed. Instead, they contended that the question was a matter for them to decide subjectively and so long as they made that decision honestly and in good faith, they would have the right to terminate.
  1. (d)
    That argument is not reasonably open on the wording of this particular contract. First, the chapeau to cl 39.4 does not say “if the Principal concludes that the Contractor has failed to show reasonable cause” or anything like it. To the contrary it is expressed in a way which invites the conclusion that it contemplates an objective assessment as to whether the condition on the right to terminate has been satisfied. But second, the applicants’ argument transposes to the assessment of whether the condition to the right is established, the law which governs whether the principal’s exercise of the right to terminate, once established, is constrained in any particular way. There is no warrant in the wording of the clause to take that course.
  1. [61]
    Finally, any evaluation by the Tribunal or the Appeal Tribunal of the nature of the contractor’s response to the show cause notice to reach a conclusion on whether the response had showed reasonable cause was a decision by them on a mixed question of fact and law.  The present appeal ground which invites this Court to reach a different conclusion on that question cannot be regarded as an appeal only on a question of law.
  2. [62]
    We would refuse leave to appeal on proposed ground 2a.

Proposed grounds 2b and 5

  1. [63]
    These proposed grounds of appeal were in these terms:
  1. “2.
    The Appeal Tribunal erred in finding the Contract was not lawfully terminated by the Appellants under the Contract upon [the contractor’s] default for:
  1. b.
    failing to proceed with due expedition and without delay and failing to carry out the work with reasonable diligence (Clause 39 2) d) /, s. 25 of Schedule 1B and Clause 11.1[29]);
  1. 5.
    The Appeal Tribunal erred in:
  1. a.
    the proper construction of the term failing to proceed with due expedition and without delay including failing to follow FPM Constructions v Council of the City of Blue Mountains [2005] NSWCA 340;
  1. b.
    finding that delay in the term failing to proceed with due expedition and without delay means unreasonable delay; and
  1. c.
    equating the term due diligence with due expedition and without delay and thereby following Hometeam Constructions Pty Ltd v McCauley [2005] NSWCA 303.”
  1. [64]
    The application for leave to appeal on grounds 2b shares similar problems to those identified in relation to grounds 1 and 2a and should be refused for essentially the same reasons.
  2. [65]
    However unlike other proposed grounds considered thus far, each of the grounds identified in proposed ground 5 does raise only a question of law. Accordingly on the question of leave to appeal it is necessary to turn to address the remaining issues of –
  1. (a)
    whether there is a reasonable argument that there is an error of law to be corrected, which, if corrected, would justify the applicant’s claim for relief; and
  1. (b)
    relevant discretionary considerations.
  1. [66]
    In our view, there were critical flaws in the legal arguments which the applicants sought to present which meant that they failed to show they had a reasonable argument that the alleged error of law had been made. Further, it was very evident that any consideration of their arguments could only occur in the context of determination of a mixed question of fact and law.
  2. [67]
    First, the applicants sought to persuade this Court to accept that on the proper construction of cl 39.2 any single delay in the progress of the works which was the fault of the contractor, so long as it was not de minimis would have to be regarded as a substantial breach of contract justifying engagement of the show cause procedure and possible termination. The applicants get to that proposition by focussing on the words “without delay” and saying that those words must be given their literal meaning.
  3. [68]
    But that construction of the clause is not reasonably arguable. We observe:
  1. (a)
    We repeat the observations made at [58](a), [58](b) and [58](c) above.
  1. (b)
    Here the applicants look to the definition of “d) where there is no construction program, failing to proceed with due expedition and without delay.” (It was accepted that there was no relevant construction program.)
  1. (c)
    But again “failing” is used as a present participle verb and should be taken to refer to a continuity of failure. Further “due expedition and without delay” should be understood as a compendium phrase describing a required manner of proceeding. It requires a characterisation of the manner by which the contractor has in fact been proceeding.
  1. (d)
    Support for that construction of the clause is also to be found in a comparison between cl 39.2c) and cl 39.2d). Where there is a program, a substantial breach requires an assessment whether the departure is substantial and whether it is excused. It does not make any sense to have a different approach where there is not a construction program.
  1. (e)
    That is not to say that a single failure to proceed with due expedition and without delay could not ever amount to a “substantial breach”, but if it did that would be because it fell within the ordinary and natural meaning of that phrase and would turn on an assessment of the particular significance of the delay concerned.
  1. (f)
    That the question of characterisation required by the clause is a broad one finds support in these observations made by Dixon J in Dura (Australia) Constructions Pty Ltd v Hue Boutique Living Pty Ltd (No 3) [2012] VSC 99 (which observations may be applied here despite the fact that the contract there considered is not on all fours with the present contract), namely:

“…. The meaning of [due expedition and without delay] and the circumstances that will sufficiently demonstrate a substantial breach of the obligation require careful consideration. The phrase ‘due expedition and without delay’ is uncertain in its precise meaning. The ordinary meaning of due expedition, as revealed by the Macquarie Dictionary, requires, affirmatively, adequate or sufficient promptness or speed in accomplishing something. The phrase cannot be construed in the abstract and obviously depends on what is to be achieved, namely, progress with the works. The second limb of the phrase addressed the negative in plain language – the progress of the works should also be characterised as being without delay. In context, the obligation qualifies how the contractor ‘proceeds with the work under the contract’. What is adequate or sufficient will be conditioned by other terms of the bargain such as the agreed date for practical completion, the agreed circumstances when, and procedure for, the date for practical completion being varied and how the works are to be staged or programmed. Such references, extraneous to the phrase, introduce uncertainty in its precise meaning as they, in turn, may depend on the interpretation of circumstances or events that have occurred in the performance of the contract. Careful consideration of the contractual context is required.”

  1. (g)
    The result is that in order for the applicants to show this type of substantial breach it would be necessary for them to prove that the proper characterisation of the manner by which the contractor had been proceeding with the work was that the contractor had been failing to proceed “with due expedition and without delay”. One event of delay would not necessarily establish the requisite characterisation.
  1. (h)
    In any examination of the way in which the contractor had been proceeding in order to determine whether it could be said that it had been failing to proceed “with due expedition and without delay”, it would be necessary to bear in mind the operation of all the central obligations in the contract governing the manner of progress, namely:
  1. (i)
    The central obligation in cl 34 is expressed as an obligation to ensure that the work under the contract reaches practical completion by the date for practical completion.
  1. (ii)
    That obligation was qualified by the ability to obtain extensions of time for that date for “qualifying causes of delay”. That phrase was defined broadly to include, amongst other things, delays caused by the Superintendent, the Principal and other contractors (not employed by the contractor) and also causes “other than a breach of omission by the contractor”.
  1. (iii)
    The warranty to proceed with reasonable diligence which flows from the cl 11.1 promise to comply with legislative requirements.
  1. (i)
    This strongly suggests that proceeding with due expedition and without delay is the manner by which the contractor is required to proceed towards the goal of reaching practical completion by the date for practical completion. And it necessarily accepts that any entitlement to shift the timing of the end goal (namely the date for practical completion) may well affect the characterisation exercise.
  1. [69]
    Putting to one side the misconceived argument that proof of any single delay would necessarily establish that the contractor had been “failing to proceed with due expedition and without delay”, the focus of the applicants’ argument was on alleged error of law in the meaning which the Appeal Tribunal gave to that phrase. But the Appeal Tribunal did not make the errors alleged of it. It treated “due expedition and without delay” as a compendium phrase describing a required manner of proceeding. It sought to consider the phrase in the entire contractual context, recognising the significance of extensions of time which had been agreed, which had been sought and might be disputed, and which might not yet have been sought. It was against that background that its observations that “due expedition” means such expedition as it was reasonable for the contractor to have exercised in all the circumstances and “delay” in “without delay” must mean unreasonable delay on the part of the contractor must be understood. FPM Constructions Pty Ltd v Council of the City of Blue Mountains did not establish any principle which ought to have been applied to this contract which was not applied. And to the extent that Hometeam Constructions Pty Ltd v McCauley was referred to, the Appeal Tribunal did so only insofar as it thought that there was relevant analogy in point of principle.
  2. [70]
    Second, any evaluation by the Tribunal or the Appeal Tribunal of the evidence of breach on which the applicants relied to reach a conclusion on whether the breach was a substantial breach was a decision by them which was at best a decision on a mixed question of fact and law. The question whether a contractor has proceeded with due expedition and without delay is a question of fact. The present appeal ground which invites this Court to reach a different conclusion on that question cannot be regarded as an appeal only on a question of law.
  3. [71]
    Third, even if, contrary to our view, there was a reasonable argument that there was an error of law to be corrected in the interpretation given to what was a “substantial breach”, that error would go nowhere unless there was also a reasonable argument that there was an error of law to be corrected in the approach take to the question whether the contractor had showed reasonable cause in its response to the show cause notice. As to this, we repeat the observations made at [60] above.
  4. [72]
    Finally, any evaluation by the Tribunal or the Appeal Tribunal of the nature of the contractor’s response to the show cause notice to reach a conclusion on whether the response had showed reasonable cause was a decision by them on a mixed question of fact and law.  The present appeal ground which invites this Court to reach a different conclusion on that question cannot be regarded as an appeal only on a question of law.
  5. [73]
    We would refuse leave to appeal on proposed grounds 2b and 5.

Proposed ground 2c

  1. [74]
    This proposed ground of appeal was in these terms:
  1. “2.
    The Appeal Tribunal erred in finding the Contract was not lawfully terminated by the Appellants under the Contract upon [the contractor’s] default for:
  1. c.
    failure to ensure that the work under the Contract reaches Practical Completion by the Date for Practical Completion (Clause 34.1);”
  1. [75]
    The application for leave to appeal on grounds 2c shares similar problems to those identified in relation to ground 1 and the preceding parts of ground 2 and should be refused for essentially the same reasons.
  2. [76]
    We would refuse leave to appeal on proposed ground 2c.

Proposed grounds 2d, 3b and 6

  1. [77]
    The proposed grounds of appeal were in these terms:
  1. “2.
    The Appeal Tribunal erred in finding the Contract was not lawfully terminated by the Appellants under the Contract upon [the contractor’s] default for:
  1. d.
    subcontracting part of the work under the Contract without the Superintendent’s prior written approval (Clause 9.2).
  1. 3.
    The Appeal Tribunal erred in finding the Contract was not lawfully terminated by the Appellants otherwise at law upon [the contractor’s] default:
  1. b.
    on the basis of subcontracting part of the work under the Contract without the Superintendent’s prior written approval (Clause 9.2 and Special Condition 6), either as an essential or an innominate term;
  1. 6.
    The Appeal Tribunal erred as to the proper construction of Clause 9.2 and Item 17 of Annexure Part A of the Contract.”
  1. [78]
    Clause 9.2 obliged the contractor not to subcontract or to allow a subcontractor to subcontract without the Superintendent’s prior written approval (which should not be unreasonably withheld). Item 17 specified that the obligation applied to all subcontract work other than a specific exception. The exception was not said to be relevant.
  2. [79]
    There had been two occasions in which the contractor had engaged subcontractors without the specific approval of either the applicants or the Superintendent.
  3. [80]
    The Appeal Tribunal observed:

“The failure to obtain prior written approval was not a substantial breach by definition, and the Member found that this did not amount to a substantial breach for the purposes of Clause 39. He found that the superintendent did ultimately give approval for the plastering subcontractor, and that the painting subcontractor was just a painter employed to do some touch-up jobs, so that his involvement in the project was not of significance.”[30]

  1. [81]
    Proposed appeal ground 6 does raise only a question of law. It seems that the applicants wish to argue that the promise not to subcontract without approval should be regarded as a condition. In Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd[31] the High Court instructed that “[i]t is the common intention of the parties, expressed in the language of their contract, understood in the context of the relationship established by that contract and (in a case such as the present) the commercial purpose it served, that determines whether a term is “essential”, so that any breach will justify termination.”
  2. [82]
    The Appeal Tribunal rejected that argument in these terms:

“In any case, I do not regard Clause 9.2 as a condition. It is not said to be one, and there is nothing in the contract to suggest that it was treated that way by the parties. Breach of it was not made a substantial breach by definition by Clause 39, nor did that clause give a right of summary termination. In the context of the building industry, where subcontracting is rife and it is commonplace for almost every person who does any actual work on a building site to be a contractor rather than an employee, it would not be a commercial construction of the contract to treat Clause 9.2 as a condition.”[32]

  1. [83]
    Apart from argument by assertion, reliance on a case which the Appeal Tribunal correctly identified as involving materially different provisions[33] and attempt to rely on irrelevant extrinsic evidence, the applicants advanced no substantive argument as to why the clause should be regarded as a condition. We do not think the proposition is reasonably arguable. We would refuse leave to appeal on the construction ground.
  2. [84]
    As to the other grounds, whether one is evaluating the significance of the breach through the prism of substantial breach within the meaning of cl 39.2 or through the prism of sufficiently serious breach of an innominate term for the purpose of termination at common law, the question involves either a question of fact or a mixed question of law and fact. The result is that the application for leave to appeal shares similar problems to those identified in relation to ground 1 and the preceding parts of ground 2 and should be refused for essentially the same reasons.
  3. [85]
    We would refuse leave to appeal on proposed grounds 2d, 3b and 6.

Proposed ground 2e

  1. [86]
    The proposed ground of appeal was in these terms:
  1. “2.
    The Appeal Tribunal erred in finding the Contract was not lawfully terminated by the Appellants under the Contract upon [the contractor’s] default for:
  1. e.
    failure to supply everything necessary for the proper performance of the Contractor's obligations and discharge of the Contractor's liabilities (Clause 28).”
  1. [87]
    Clause 28 obliged the contractor to supply everything necessary for the proper performance of the contractor’s obligations and the discharge of the contractor’s liabilities. It appears that the applicants’ underlying complaint was the contractor had consistently failed to supply all necessary resources including adequate labour to perform the work with due expedition and without delay, with reasonable diligence and failure to maintain progress.
  2. [88]
    The application for leave to appeal on ground 2e shares similar problems to those identified in relation to ground 1 and the preceding parts of ground 2 and should be refused for essentially the same reasons.
  3. [89]
    We would refuse leave to appeal on proposed ground 2e.
  4. [90]
    For completeness, we also observe that the reasons we have given for refusing leave to appeal after separate consideration of the subparagraphs of proposed ground 2 also lead us to conclude that leave to appeal should be refused on proposed ground 2 upon consideration of those subparagraphs in the aggregate.

Proposed ground 3a

  1. [91]
    This proposed ground of appeal was in these terms:
  1. “3.
    The Appeal Tribunal erred in finding the Contract was not lawfully terminated by the Appellants otherwise at law upon [the contractor’s] default:
  1. a.
    on the basis of breaches of Special Condition 7 and Clause 11.1 of the Contract and the implied term contained in s 21 of Schedule lB of the Queensland Building and Construction Commission Act 1991 (Qld), either as essential or innominate terms;”
  1. [92]
    Special condition 7 stated that each party agreed the statutory warranties applied to the work under the contract. Cl 11.1 was the general promise to comply with legislative requirements. Section 21 of Schedule 1B provided:

“The building contractor warrants the subject work will be carried out in accordance with all relevant laws and legal requirements, including, for example, the Building Act 1975”.

  1. [93]
    The applicants suggested that this ground raised “illegality”. But it did not. It raised first the question whether the clauses relied on should be regarded as conditions such that any breach would justify termination at common law. Then it raised the alternative argument that the nature of any breaches was such as should be regarded as sufficiently serious a breach of an innominate term as to justify termination.
  2. [94]
    As to the former argument, no proper argument was advanced that the promises should be regarded as conditions. In our view there is no reasonable argument in support of the proposition that such promises should be so regarded. We would refuse leave to appeal on the construction ground.
  1. [95]
    The latter argument may be dismissed on the bases expressed at [84] above.
  2. [96]
    We would refuse leave to appeal on proposed ground 3a.

Proposed ground 3c

  1. [97]
    This proposed ground of appeal was in these terms:
  1. “3.
    The Appeal Tribunal erred in finding the Contract was not lawfully terminated by the Appellants otherwise at law upon [the contractor’s] default:
  1. c.
    on the basis of breaches of contract (Clause 1 Definition of "Works", WUC (from work under the Contract), Clauses 2.1, 29.1, 29.3, 39.2 a) iii) and iv), plans and specifications included in the Contract, standards referred to in the contract, Special Conditions 6.1 and 7, ss. 20, 21, 22 and 23 of Schedule 1B of the Queensland Building and Construction Commission Act 1991 (Qld)) due to defects in the work under the Contract, either as essential or an innominate terms;”
  1. [98]
    By this ground the applicants sought to have this Court grant leave to appeal to enable it to advance error in relation to what they contended were “significant and fundamental issues in regards to defective work”. For reasons expressed in relation to other grounds, it is absolutely plain that the ground formulated is not an appeal only on a question of law.
  2. [99]
    We would refuse leave to appeal on proposed ground 3c.

Proposed ground 3d

  1. [100]
    This proposed ground of appeal was in these terms:
  1. “3.
    The Appeal Tribunal erred in finding the Contract was not lawfully terminated by the Appellants otherwise at law upon [the contractor’s] default:
  1. d.
    on the basis of repudiation of the Contract by [the contractor].”
  1. [101]
    For reasons expressed in relation to other grounds, it is absolutely plain that the ground formulated is not an appeal only on a question of law.
  2. [102]
    We would refuse leave to appeal on proposed ground 3d.
  3. [103]
    For completeness, we also observe that the reasons we have given for refusing leave to appeal after separate consideration of the subparagraphs of proposed ground 3 also lead us to conclude that leave to appeal should be refused on proposed ground 3 upon consideration of those subparagraphs in the aggregate.

Proposed grounds 4 and 8

  1. [104]
    These proposed grounds of appeal were in these terms:
  1. “4.
    The Appeal Tribunal erred as to the proper construction of Clauses 39.2, 39.3 and 39.4 of the Contract.
  1. 8.
    The Appeal Tribunal erred in admitting and relying on evidence after termination to permit [the contractor] to show cause twice rather than limit its consideration to the evidence in [the contractor’s] response to the notice to show cause.”
  1. [105]
    The suggested errors in the proper construction of cl 39 have already been considered in relation to earlier grounds. We have explained that on the proper construction of this particular contract, an objective assessment is called for when considering whether the conditions set out in the chapeaux of cll 39.2 and 39.4 have been satisfied. No reasonable argument that there were errors of law to be corrected has been identified in the appeal ground, let alone demonstrated.
  2. [106]
    Proposed ground 8 does not raise only a question of law.[34] We would refuse leave to appeal on this ground.

Proposed ground 7

  1. [107]
    This proposed ground of appeal was in these terms:
  1. “7.
    The Appeal Tribunal erred as to the proper construction the extension of time terms of the Contract, “qualifying cause of delay” as defined in Clause 1.1, Clauses 34.3 and 34.5, Special Condition 10, s. 42 of Schedule 1B of the Queensland Building and Construction Commission Act 1991 (Qld).”
  1. [108]
    The proposed ground is entirely opaque. At base it seems that the applicants complain that the Appeal Tribunal should have overturned the findings made by the Tribunal at first instance concerning whether the contractor should have been entitled to extensions of time. Such an appeal could not possibly be regarded as an appeal only on a question of law. We would refuse leave to appeal on proposed ground 7.

Proposed ground 9

  1. [109]
    This proposed ground of appeal was in these terms:
  1. “9.
    After deciding to grant leave to appeal on question of fact only or a question of mixed law and fact, the Appeal Tribunal erred in failing to decide the appeal by way of a rehearing as required by s. 147(2) of [the QCAT Act].”
  1. [110]
    An Appeal Tribunal could, in theory, err in law by failing to understand what were the requirements of an appeal by way of a rehearing. In a particular case such an error might be capable of being shown to have derived from an erroneous legal decision such that an appeal ground which raised only a question of law might be framed and, if resolved in favour of an applicant, justify a grant of leave and the remedy of remission.
  2. [111]
    The problem with this proposed ground of appeal is that the applicants did not advance a reasonable argument that the Appeal Tribunal had erred in this way. Nor did the appeal ground raise only a question of law.
  1. [112]
    We agree with the respondent’s suggestion that the applicants’ contention seems to be that, having granted leave to appeal, the Appeal Tribunal was then obliged to rehear and make new findings in respect to the entirety of the evidence and all of the contentions and submissions in the Tribunal. That contention is wrong because it describes a process more akin to a hearing de novo.
  2. [113]
    The Appeal Tribunal sufficiently encompassed the essential elements of a rehearing when the Judicial Member observed:

“It is well established that, on an appeal by way of rehearing, the Appeal Tribunal is required to conduct a real review of the hearing, and the Member’s reasons, and make its own determination of relevant facts in issue from the evidence, giving due deference and attaching a good deal of weight to the Member’s view. Nevertheless, in order to succeed on such an appeal, the appellants must establish some legal, factual or discretionary error.”

  1. [114]
    The formulation by the Appeal Tribunal can perhaps be mildly criticised as too brief a description of the delineation between the circumstances in which an appellate tribunal conducting an appeal by rehearing may give deference to the advantage held by the tribunal of fact who actually heard the evidence, and those where an appellate tribunal is in as good a position as the tribunal of fact.[35] But that is not the point which the applicants make. And even if it was, the nature of the inadequacy of the description is not an error of law upon for which we would in the exercise of our discretion grant leave to appeal.
  2. [115]
    We would refuse leave to appeal on proposed ground 9.

Proposed ground 10

  1. [116]
    This proposed ground of appeal was in these terms:
  1. “10.
    The Appeal Tribunal denied the Appellants natural justice because it erred in:
  1. a.
    failing to give proper, genuine and realistic consideration to all of relevant material, evidence and submissions placed before it; and
  1. b.
    failing to act fairly and according to the substantial merits of the case as required by s 28(2) of [the QCAT Act].”
  1. [117]
    It may be accepted that a denial of procedural fairness by an inferior tribunal will generally involve an error of law. But as was explained at [19] above, an appeal which must be “only on a question of law” is of a narrower ambit than an appeal in which a question of law is merely “involved”. The very subject matter of the appeal must be only on a question of law. The subject matter of the present appeal ground could not be so regarded. To the contrary, it is a ground by which the applicants invite this Court to analyse the facts of the proceeding; the entirety of the procedural record of the conduct of the proceeding before the Appeal Tribunal; then to apply the legal standards required by the statutory prescriptions concerning proper process in the conduct of proceeding; and to reach an evaluative judgment contrary to that reached below. The questions being agitated would at least be mixed question of fact and law.[36]
  1. [118]
    We would refuse leave to appeal on this ground.
  2. [119]
    For completeness, we should observe that our analysis of the limited nature of this Court’s appellate jurisdiction pursuant to s 150 of the QCAT Act, does not mean that there could be no remedy if there was a case in which a litigant before the Appeal Tribunal truly had been denied procedural fairness because the Appeal Tribunal had failed to comply with the obligations to do so expressed in s 28 of the QCAT Act.
  3. [120]
    We do not exclude the possibility that such an outcome might in a particular case be capable of being shown to have derived from an erroneous legal decision such that an appeal ground which raised only a question of law might be framed and if resolved in favour of an applicant, justify a grant of leave and the remedy of remission. But even if it could not, such an error might amount to an error going to jurisdiction thereby justifying an administrative law remedy under the Judicial Review Act[37] or, possibly, the exercise of the supervisory jurisdiction of the Supreme Court discussed in Kirk v Industrial Court of NSW[38] which jurisdiction is beyond the power of a State legislature to exclude. It is notable that on other occasions this Court has made declaratory orders in response to having been persuaded of the existence of such jurisdictional error by the Appeal Tribunal.[39]
  4. [121]
    None of these possible avenues avail the present applicants, first, because they have not sought to engage them, and, second, because it was not reasonably arguable that there had been any such denial by the Appeal Tribunal in this case.
  5. [122]
    We would refuse leave to appeal on proposed ground 10.

Conclusion

  1. [123]
    None of the proposed grounds of appeal should be the subject of leave to appeal. Accordingly we would order that the applicants’ application for leave to appeal be refused, with costs.

Footnotes

[1]See Allen & Taylor v Queensland Building and Construction Commission [2020] QCAT 63.

[2]See Allen v Queensland Building and Construction Commission [2023] QCATA 66.

[3]See s 151 of the QCAT Act.

[4]See Uniform Civil Procedure Rules 1999, rr 778 and 779 and https://www.courts.qld.gov.au/ data/assets/word_doc/0010/88417/ucpr-f-69-v4-070614.doc

[5]Pivovarova v Michelsen (2019) 2 QR 508 at [2] to [10] per Fraser JA, at [14] (Boddice J agreeing) and at [37] per Crow J.

[6]MKN v Laq [2020] QCA 4; Lee v Crime and Corruption Commission; Crime and Corruption Commission v Lee [2020] QCA 201; Seirlis v Queensland Building and Construction Commission [2020] QCA 283; State of Queensland v Tafao; Serco Australia Pty Ltd v Tafao [2021] QCA 56; 7 QR 474; Commissioner of State Revenue v Telgrove Pty Ltd [2022] QCA 132.

[7]   Transcript of proceedings, p 1-5, line 19-21.

[8] Haritos v Commissioner of Taxation (2015) 233 FCR 315 (Allsop CJ, Kenny, Besanko, Robertson and Mortimer JJ).

[9] Lynch v Commissioner of Police [2022] QCA 166 per Beech AJA (with whom Morrison and Bond JJA agreed) at [69] to [70]; Madden v Commissioner of Police [2023] QCA 31 per Mullins P, Bond JA and Brown J at [26].

[10] Maksymiuk v Savage [2015] QCA 177, [1], at [5]–[7] per North J (McMurdo P and Henry J agreeing) applied in Lee v Crime and Corruption Commission; Crime and Corruption Commission v Lee [2020] QCA 201 at [15]–[16] per Jackson J (with whom Sofronoff P and Morrison JA agreed).

[11]Crime and Corruption Commission v Andersen [2021] QCA 222 at [14] per Sofronoff P and Mullins and Bond JJA, following Bown v Lee [2018] QCA 13 per Sofronoff P (with whom Gotterson and McMurdo JJA agreed); Rintoul v State of Queensland [2018] QCA 20 at [10] per Applegarth J (with whom Morrison and Philippides JJA agreed); Commissioner of State Revenue v Harrison [2019] QCA 50 at [15] per Morrison JA, at [30] per Philippides JA and at [66] per Davis J; Seirlis v Queensland Building and Construction Commission [2020] QCA 283 at [6] per Mullins JA (with whom Philippides JA and Henry J agreed).

[12]Commissioner of Police v Antoniolli [2021] QCA 237 at [105]-[115] per Bond JA (with whom Flanagan J agreed), applied subsequently in Lynch v Commissioner of Police [2022] QCA 166; 11 QR 609 at [135] per Beech AJA (with whom Morrison and Bond JJA agreed); Woolston v Commissioner of Police [2023] QCA 152; 105 MVR 13 at [9] per Boddice JA (with whom Bond and Flanagan JJA agreed).

[13]Shepherd v Felt & Textile Industries of Australia (1931) 45 CLR 359.

[14] Dura (Australia) Constructions Pty Ltd v Hue Boutique Living Pty Ltd (No 3) [2012] VSC 99.

[15] Allen & Taylor v Queensland Building and Construction Commission [2020] QCAT 63 at [148].

[16] Allen v Queensland Building and Construction Commission [2023] QCATA 66 at [184] and [209].

[17]Mousa v Vukobratich Enterprises Pty Ltd [2019] QSC 49.

[18]Allen v Queensland Building and Construction Commission [2023] QCATA 66 at [248].

[19] Allen v Queensland Building and Construction Commission [2023] QCATA 66 at [249].

[20] Hayes v Federal Commissioner of Taxation (1956) 96 CLR 47 at 51.

[21] As to which see, for example, Hope v Bathurst City Council (1980) 144 CLR 1 at 7 per Mason J with whom Gibbs, Stephen, Murphy and Aickin JJ agreed; Collector of Customs v Pozzolanic (1993) 43 FCR 280 at 287–288; Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389, 394–8; Vetter v Lake Macquarie City Council (2001) 202 CLR 439 at [24]–[28] per Gleeson CJ, Gummow and Callinan JJ; and Bell v Federal Commissioner of Taxation (2012) 88 ATR 923, 934–5 [36]–[41].

[22] Crime and Corruption Commission v Andersen [2021] QCA 222 at [37] per Sofronoff P and Mullins and Bond JJA.

[23] Chopra v Department of Education and Training (2019) 60 VR 505 at 527 [88] per Tate, Whelan and Kyrou JJA)

[24] Robb v Tunio [2014] QCA 127 at [22]–[23].

[25] Clause 29.1 required the contractor to use suitable new materials and proper and tradesmanlike workmanship.

[26]Clause 29.3 required the contractor to rectify defective work if notified so to do by the Superintendent

[27] Clause 11.1 required the contractor to satisfy all legislative requirements. Section 22 of Schedule lB was one such requirement, namely a warranty by the contractor that the work would be carried out in an appropriate and skilful way and with reasonable care and skill. Section 22 of Schedule 1B expressed a warranty that work would be carried out in accordance with plans and specifications.

[28]  A different view was reached in FPM Constructions Pty Ltd v Council of the City of Blue Mountains [2005] NSWCA 340 but the clause in that case required, in addition to substantial breach, that the Principal considered that damages may not be an adequate remedy and that influenced the construction of the condition.

[29]  Section 25 of Schedule 1B expressed a warranty warrants the subject work will be carried out with reasonable diligence.

[30] Allen v Queensland Building and Construction Commission [2023] QCATA 66 at [153].

[31]  Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115; [2007] HCA 61 at [48] per Gleeson CJ, Gummow, Heydon and Crennan JJ.

[32] Allen v Queensland Building and Construction Commission [2023] QCATA 66 at [156].

[33] Advance National Services Pty Ltd v Daintree Contractors Pty Ltd [2019] NSWCA 270

[34] Bagumya v Kakwano [2010] NSWSC 600 at [29] per Rothman J.

[35] Compare Sutton v Hunter (2022) 102 MVR 343; [2022] QCA 208 at [48] to [50] per Bond JA (Crow and Mellifont JJ agreeing) and Doerr v Gardiner [2023] QCA 160 at [65] to [70] per Morrison and Bond JJA and Livesey AJA

[36] Bagumya v Kakwano [2010] NSWSC 600 at [44] per Rothman J.

[37] The general exclusion of the application of parts 3 to 5 of the Judicial Review Act 1991 to a decision or to the conduct of the tribunal which is expressed in s 156 of the QCAT Act is subject to the exception “other than to the extent the decision or conduct is affected by jurisdictional error”.

[38] Kirk v Industrial Court of NSW (2010) 239 CLR 531 and Citta Hobart Pty Ltd v Cawthorn (2022) 96 ALJR 476 at [20] per Kiefel CJ, Gageler, Keane, Gordon, Steward and Gleeson JJ, noting that Owen v Menzies [2013] 2 Qd R 327 at 338 [20] per de Jersey CJ, 348 [61] per McMurdo P and 357 [103] per Muir JA found that QCAT is to be regarded as a Court of the State.

[39] See, for example, Chandra v Queensland Building and Construction Commission [2014] QCA 335 at [89] per Lyons J (with whom McMurdo P and North J agreed). Although the Court in that case also had thought it was an appropriate case for the exercise of appellate jurisdiction, no argument to the contrary had been presented to it: see at [87]. In our view it does not stand as authority to the contrary of our conclusions on that question.

Close

Editorial Notes

  • Published Case Name:

    Allen & Anor v Queensland Building and Construction Commission

  • Shortened Case Name:

    Allen v Queensland Building and Construction Commission

  • MNC:

    [2024] QCA 24

  • Court:

    QCA

  • Judge(s):

    Mullins P, Bond JA, Williams J

  • Date:

    01 Mar 2024

  • Selected for Reporting:

    Editor's Note

Litigation History

EventCitation or FileDateNotes
Primary Judgment[2020] QCAT 6327 Feb 2020Application to review Queensland Building and Construction Commission's rejection of claim pursuant to statutory insurance scheme arising out of purported termination of residential construction contract; Commission's decision confirmed: Member Oliver.
Primary Judgment[2023] QCATA 6615 Jun 2023So far as appeal raised questions of law, appeal dismissed; as to questions of fact or mixed fact and law, leave to appeal granted in part, appeal by leave dismissed: Judicial Member McGill SC.
Appeal Determined (QCA)[2024] QCA 2401 Mar 2024Application for leave to appeal refused: Mullins P, Bond JA and Williams J.

Appeal Status

Appeal Determined (QCA)

Cases Cited

Case NameFull CitationFrequency
Advance National Services Pty Ltd v Daintree Contractors Pty Ltd [2019] NSWCA 270
1 citation
Jump To
Cite 1 - [2019] NSWCA 270
Allen v Queensland Building and Construction Commission [2020] QCAT 63
2 citations
Jump To
Cite 1 - [2020] QCAT 63
Cite 2 - [2020] QCAT 63
Allen v Queensland Building and Construction Commission [2023] QCATA 66
7 citations
Jump To
Cite 1 - [2023] QCATA 66
Cite 2 - [2023] QCATA 66
Cite 3 - [2023] QCATA 66
Cite 4 - [2023] QCATA 66
Cite 5 - [2023] QCATA 66
Cite 6 - [2023] QCATA 66
Cite 7 - [2023] QCATA 66
Bagumya v Kakwano [2010] NSWSC 600
2 citations
Jump To
Cite 1 - [2010] NSWSC 600
Cite 2 - [2010] NSWSC 600
Bell v Federal Commissioner of Taxation (2012) 88 ATR 923
1 citation
Jump To
Cite 1 - (2012) 88 ATR 923
Bown v Lee [2018] QCA 13
1 citation
Jump To
Cite 1 - [2018] QCA 13
Chandra v Queensland Building and Construction Commission [2014] QCA 335
1 citation
Jump To
Cite 1 - [2014] QCA 335
Chopra v Department of Education and Training [2019] VSCA 298
1 citation
Jump To
Cite 1 - [2019] VSCA 298
Chopra v Department of Education and Training (2019) 60 VR 505
2 citations
Jump To
Cite 1 - (2019) 60 VR 505
Cite 2 - (2019) 60 VR 505
Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389
1 citation
Jump To
Cite 1 - (1996) 186 CLR 389
Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280
1 citation
Jump To
Cite 1 - (1993) 43 FCR 280
Commissioner of Police v Antoniolli [2021] QCA 237
2 citations
Jump To
Cite 1 - [2021] QCA 237
Cite 2 - [2021] QCA 237
Commissioner of State Revenue v Harrison [2019] QCA 50
1 citation
Jump To
Cite 1 - [2019] QCA 50
Commissioner of State Revenue v Telgrove Pty Ltd [2022] QCA 132
1 citation
Jump To
Cite 1 - [2022] QCA 132
Crime and Corruption Commission v Andersen [2021] QCA 222
3 citations
Jump To
Cite 1 - [2021] QCA 222
Cite 2 - [2021] QCA 222
Cite 3 - [2021] QCA 222
Doerr v Gardiner [2023] QCA 160
1 citation
Jump To
Cite 1 - [2023] QCA 160
Dura (Australia) Constructions Pty Ltd v Hue Boutique Living Pty Ltd [2012] VSC 99
3 citations
Jump To
Cite 1 - [2012] VSC 99
Cite 2 - [2012] VSC 99
Cite 3 - [2012] VSC 99
FPM Constructions Pty Ltd v Council of the City of Blue Mountains [2005] NSWCA 340
3 citations
Jump To
Cite 1 - [2005] NSWCA 340
Cite 2 - [2005] NSWCA 340
Cite 3 - [2005] NSWCA 340
Haritos v Commissioner of Taxation (2015) 233 FCR 315
1 citation
Jump To
Cite 1 - (2015) 233 FCR 315
Hayes v Federal Commissioner of Taxation (1956) 96 CLR 47
2 citations
Jump To
Cite 1 - (1956) 96 CLR 47
Cite 2 - (1956) 96 CLR 47
Hayes v Federal Commissioner of Taxation [1956] HCA 21
1 citation
Jump To
Cite 1 - [1956] HCA 21
Hometeam Constructions Pty Ltd v McCauley (2005) NSWCA 303
2 citations
Jump To
Cite 1 - (2005) NSWCA 303
Cite 2 - (2005) NSWCA 303
Hope v Bathurst City Council (1980) 144 CLR 1
1 citation
Jump To
Cite 1 - (1980) 144 CLR 1
Kirk v Industrial Court (NSW) (2010) 239 CLR 531
1 citation
Jump To
Cite 1 - (2010) 239 CLR 531
Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115
2 citations
Jump To
Cite 1 - (2007) 233 CLR 115
Cite 2 - (2007) 233 CLR 115
Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61
1 citation
Jump To
Cite 1 - [2007] HCA 61
Lee v Crime and Corruption Commission [2020] QCA 201
2 citations
Jump To
Cite 1 - [2020] QCA 201
Cite 2 - [2020] QCA 201
Lynch v Commissioner of Police(2022) 11 QR 609; [2022] QCA 166
2 citations
Jump To
Cite 1 - [2022] QCA 166
Cite 2 - [2022] QCA 166
Madden v Commissioner of Police(2023) 14 QR 1; [2023] QCA 31
1 citation
Jump To
Cite 1 - [2023] QCA 31
Maksymiuk v Savage [2015] QCA 177
1 citation
Jump To
Cite 1 - [2015] QCA 177
Mousa v Vukobratich Enterprises Pty Ltd [2019] QSC 49
1 citation
Jump To
Cite 1 - [2019] QSC 49
Owen v Menzies[2013] 2 Qd R 327; [2012] QCA 170
1 citation
Jump To
Cite 1 - [2013] 2 Qd R 327
Pivovarova v Michelsen(2019) 2 QR 508; [2019] QCA 256
3 citations
Jump To
Cite 1 - [2019] QCA 256
Cite 2 - (2019) 2 QR 508
Cite 3 - (2019) 2 QR 508
R v TAO [2020] QCA 4
1 citation
Jump To
Cite 1 - [2020] QCA 4
Rintoul v State of Queensland [2018] QCA 20
1 citation
Jump To
Cite 1 - [2018] QCA 20
Robb v Tunio [2014] QCA 127
1 citation
Jump To
Cite 1 - [2014] QCA 127
Seirlis v Queensland Building and Construction Commission [2020] QCA 283
2 citations
Jump To
Cite 1 - [2020] QCA 283
Cite 2 - [2020] QCA 283
Shepherd v Felt & Textiles of Australia Ltd (1931) 45 CLR 359
2 citations
Jump To
Cite 1 - (1931) 45 CLR 359
Cite 2 - (1931) 45 CLR 359
Shepherd v Felt & Textiles of Australia Ltd [1931] HCA 21
1 citation
Jump To
Cite 1 - [1931] HCA 21
State of Queensland v Tafao(2021) 7 QR 474; [2021] QCA 56
1 citation
Jump To
Cite 1 - [2021] QCA 56
Sutton v Hunter [2022] QCA 208
1 citation
Jump To
Cite 1 - [2022] QCA 208
Sutton v Hunter & Anor (2022) 102 MVR 343
1 citation
Jump To
Cite 1 - (2022) 102 MVR 343
Vetter v Lake Macquarie CC (2001) 202 CLR 439
1 citation
Jump To
Cite 1 - (2001) 202 CLR 439
Woolston v Commissioner of Police [2023] QCA 152
1 citation
Jump To
Cite 1 - [2023] QCA 152

Cases Citing

Case NameFull CitationFrequency
Angelopoulos v State of Queensland [2025] QCA 832 citations
Boys v Imperial Homes (Qld) Pty Ltd [2024] QCATA 351 citation
Civil Appeals (2024) 1 QLJ 1 2 citations
Commissioner of State Revenue v Lewis [2024] QCATA 1261 citation
Dalco Realty Pty Ltd v Chun [2024] QCATA 1231 citation
Dearlove v Wavar Pty Ltd [2024] QCATA 831 citation
Deemal-Hall v Office of the Director of Public Prosecutions [2024] QCATA 1312 citations
Draper v Body Corporate for Winchcombe Place CTS 15441 [2025] QCATA 662 citations
Huang v Body Corporate for the Dorchester CTS 10749 [2024] QCATA 641 citation
Jackson v Residential Tenancies Authority [2024] QCATA 312 citations
Lance v Riviera Motors Pty Ltd [2025] QCATA 302 citations
Mills v Ethell [2024] QCATA 671 citation
NDISP Pty Ltd v Bowieberghs Pty Ltd [2024] QCATA 991 citation
O'Connor v Department of Child Safety, Seniors and Disability Services [2024] QCATA 342 citations
Reimer v Brighton Bayside Caravan Park [2025] QCA 63 citations
Robinson v Moyle [2024] QCATA 951 citation
Rosily v Gent [2024] QCATA 961 citation
Stella v Griffith University [2025] QCATA 202 citations
Stella v Griffith University [2025] QCA 1401 citation
Taubert v Body Corporate for Grenache CTS 29711 [2025] QCATA 612 citations
Wallace v Hull [2024] QCATA 701 citation
Waller Family Lawyers Pty Ltd v McAuley [2025] QCA 25 2 citations
Walsh v Ng'ang'a [2025] QCA 412 citations
1

Require Technical Assistance?

Message sent!

Thanks for reaching out! Someone from our team will get back to you soon.

Message not sent!

Something went wrong. Please try again.