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- Russell v Queensland Building and Construction Commission[2015] QCAT 362
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Russell v Queensland Building and Construction Commission[2015] QCAT 362
Russell v Queensland Building and Construction Commission[2015] QCAT 362
CITATION: | Russell v Queensland Building and Construction Commission [2015] QCAT 362 |
PARTIES: | Cedric Ernest Russell (Applicant) |
v | |
Queensland Building and Construction Commission (Respondent) |
APPLICATION NUMBER: | GAR067-13 |
MATTER TYPE: | General administrative review matters |
HEARING DATE: | 11 August 2015 |
HEARD AT: | Brisbane |
DECISION OF: | Member Browne |
DELIVERED ON: | 24 August 2015 |
DELIVERED AT: | Brisbane |
ORDERS MADE: |
|
CATCHWORDS: | GENERAL ADMINISTRATIVE REVIEW – stay and transfer of proceedings – where application to review scope of works – where stay of proceedings was refused by the Tribunal – where Tribunal made decisions about direction to rectify and unsatisfactory rectification of work – where proceedings issued in the District Court under s 71 of the Queensland Building and Construction Commission Act 1991 (Qld) – whether the District Court has jurisdiction to determine issues to be considered in the review proceedings – whether Tribunal should grant a stay or transfer proceedings Queensland Civil and Administrative Tribunal Act 2009 (Qld), ss 3, 52, 58, 59, 62, 100 Queensland Building and Construction Commission Act 1991 (Qld), ss 71, 86 Chras Straker Pty Ltd as trustee for Dianne Crea Family Trust and Anor v Orsay Holdings Pty Ltd [2011] QCAT 676; cited Henderson & Anor v The Body Corporate for Merrimac Heights [2011] QSC 336; cited Kuligowski v Metrobus [2004] 220 CLR 363; cited Mahoney v Queensland Building Services Authority [2013] QCA 323, cited Namour v Queensland Building Services Authority [2014] QCA 72; cited Russell v Queensland Building Services Authority [2013] QCAT 329; cited Russell v Queensland Building Services Authority [2014] QCAT 094; cited Samimi & Anor v Queensland Building and Construction Commission [2015] QCA 106; cited |
APPEARANCES:
APPLICANT: | Ms P Ahern of Counsel instructed by Shand Taylor Lawyers |
RESPONDENT: | Mr M Cooke of Counsel |
REASONS FOR DECISION
- [1]Cedric Russell built a house for owners of land in Springfield Lakes and did some building work in 2006. The homeowners complained to the Queensland Building and Construction Commission (QBCC) about the work.
- [2]The QBCC made decisions about the building work, the unsatisfactory rectification of work and a decision to issue a scope of works.
- [3]Mr Russell filed applications in the Tribunal to review the decisions about the direction to rectify and the unsatisfactory rectification work (applications GAR232-11 and GAR003-13) and the scope of works (application GAR067-13).
- [4]On 28 March 2013, the Tribunal refused Mr Russell’s application to stay the scope of works decision pending the determination of the review application (GAR067-13). The Tribunal found that the QBCC took the ‘unusual step’ of going ‘straight to’ the scope of work while Mr Russell’s review application was pending because of concerns about safety and stability of a retaining wall. The Tribunal found that the QBCC ‘had to act urgently’ under the Home Warranty Insurance Scheme.[1]
- [5]In determining the stay, the Tribunal found that Mr Russell ‘is not disadvantaged’ by the QBCC’s decision (‘of going straight to the scope of works’).[2] The Tribunal found that if Mr Russell is successful in reviewing the decision to issue the direction to rectify and the decision is set aside ‘that will be the end of the matter’ and the QBCC can not recover the cost of the rectification work.[3] The Tribunal also found that if the review application is not successful and the decision to issue the direction to rectify is confirmed then the Tribunal ‘will review the scope of work’.[4]
- [6]On 8 August 2013, the Tribunal made a direction that the application (GAR067-13) to review the scope of works decision is listed for a directions hearing on ‘a date to be advised’ after the determination of applications GAR003-13 and GAR232-11 (the direction to rectify certain work and the unsatisfactory rectification of work decisions).
- [7]On 21 March 2014, the Tribunal made findings about the direction to rectify and unsatisfactory rectification work decisions (applications GAR232-11 and GAR003-13). The Tribunal made orders as follows:
1. Set aside the decision of the QBCC made on 6 July 2011 to issue Direction to Rectify No. 36440.
2. Set aside the decision of the QBCC made on 6 December 2012 that work undertaken by Mr Russell pursuant to the compromise agreement dated 26 March 2012 was rectification work undertaken in compliance with Directions to Rectify No. 36440.[5]
- [8]The QBCC applied for leave to appeal or appeal the decision of the Tribunal. On 1 May 2015, the Appeal Tribunal dismissed the application for leave to appeal and appeal. The Appeal Tribunal found no arguable case of error in the learned Member’s findings and that that there was no basis for the Appeal Tribunal to ‘interfere with the learned Member’s exercise of discretion’ which ultimately determined the outcome of the application.[6]
- [9]On 22 June 2015, the QBCC commenced proceedings in the District Court of Queensland against Mr Russell to recover the sum of $174,771.50 as a ‘debt due and owing’ pursuant to s 71(1) of the Queensland Building and Construction Commission Act 1991 (the QBCC Act).[7] This is because the QBCC approved rectification work and made a payment under the insurance scheme.
- [10]Under s 71(1) of the QBCC Act, the QBCC ‘may recover’ the amount of the payment ‘as a debt’ from the building contractor by whom the relevant residential construction work ‘was, or was to be, carried out’ or any other person through ‘whose fault’ the claim arose.[8]
- [11]The QBCC now seeks a stay of the scope of works proceedings (application GAR067-13) until the District Court proceedings are finalised and in the alternative a transfer of the matter (GAR067-13) to the District Court.[9]
- [12]The QBCC submits that there is no utility in proceeding with the administrative review proceedings (GAR067-13) in the Tribunal because the District Court can give final relief in respect of any monetary payment found to be payable by Mr Russell. The QBCC submits that because the District Court has the power to make an order giving final relief, there is an issue of costs to consider. The issue of costs relates to duplicity of proceedings because the QBCC says the District Court will be required to consider issues that the Tribunal (on review) will also consider. The QBCC also submits that Mr Russell did not challenge the QBCC’s decision by way of judicial review in respect of the acceptance of the claim (by the QBCC) under the insurance scheme.
- [13]Mr Russell opposes the QBCC’s application.[10] Mr Russell says that the scope of works decision will be not justiciable in the District Court and issue estoppel will arise in relation to findings of fact that the Tribunal has already determined in the direction to rectify and unsatisfactory rectification of work decisions (GAR232-11 and GAR003-13). Mr Russell says a stay will deprive his right to a merits review because the District Court will not have the jurisdiction to hear his application.
- [14]
Should the Tribunal stay the scope of works proceedings (GAR067-13)?
- [15]The QBCC seeks a stay of the proceedings under the QCAT Act pursuant to s 52 (power to transfer the matter); or ss 58 or 62 (power to make an interim order or give a direction).[13]
- [16]The Tribunal has the power to make an interim order ‘it considers appropriate in the interests of justice’ and may grant an interim injunction in a proceeding if it is just and convenient to do so.[14] The test to determine whether to grant an interim injunction is whether there is a serious question to be tried and the balance of convenience.[15]
- [17]The Tribunal also has the power to give a direction at any time in a proceeding and do whatever is necessary for the speedy and fair conduct of the proceeding.[16]
- [18]In this case, there is a serious question to be tried about the scope of works decision and the QBCC has commenced District Court proceedings against Mr Russell to recover an amount claimed under s 71 of the QBCC Act.
- [19]The QBCC submits that Mr Russell allowed the QBCC to pay the insurance claim ‘when it knew or ought to have known it was being paid’ and the same issues (in the administrative review proceeding) will be ‘traversed by another court which has greater powers’.[17] The QBCC submits the following in written submissions:
The facts are as [sic] agreed [sic] between the parties experts [that] clearly accepts that the work was defective and that the house needed rectification. The value of the work done by the commission is the real issue and not the procedural issues of administrative review.[18]
- [20]The QBCC submits that a building contractor is liable under s 71(1) of the QBCC Act irrespective of whether they are at fault. This is because there is no defence to a claim under s 71(1).[19]
- [21]In oral submissions Mr Cooke, for the QBCC submits that there are only two elements to be satisfied in respect of s 71(1). The first is that there is an insurance claim and secondly that there has been a payment on the scheme. Mr Cooke submits that the District Court gives little weight to administrative matters undertaken in this Tribunal because s 71(1) involves ‘public money’ that has been spent.
- [22]Mr Cooke says that in lieu of Mr Russell seeking judicial review in respect of the decision to accept the claim under the insurance scheme the QBCC has an obligation to the homeowner (who has made the complaint) and not the builder (in this case Mr Russell).
- [23]Mr Cooke says that the QBCC Act does not define the scope of works decision and is ‘not a step’ to recovery of money under s 71(1). Mr Cooke says there is no ‘cost component’ to the scope of works decision that is relevant to the tender process to find the most ‘reasonable tender’. Mr Cooke says that there will be ‘some thought’ in respect of the District Court proceedings as to whether the actions of the QBCC were reasonable for the purposes of s 71(1). Mr Cooke says this is also a consideration for the purposes of the policy applicable to the insurance scheme in particular clause 2.2 that provides the QBCC can pay ‘reasonable cost[s]’.[20]
- [24]It is settled law that s 71(1) confers a right on the QBCC to recover as a debt from any of the designated persons (referred to in s 717(1)) and that it is ‘sufficient for recovery’ under the section that the authority has made a payment on a claim under the insurance scheme.[21]
- [25]In Samimi & Anor v Queensland Building and Construction Commission, the Court of Appeal referred to the earlier cases of Mahoney[22] and Namour.[23] In Samimi’s case, Boddice J said that s 71(1) gives the QBCC a right to recovery as a debt of payments made by it on a claim under the insurance scheme and which is ‘not dependent upon [the QBCC] establishing the legal correctness of a determination made by it to make that payment or any anterior step taken by it that has led to the decision to pay’.[24]
- [26]In Samimi, the Court of Appeal found that the use of the words in s 71(1) ‘on a claim under the insurance scheme’ requires the payments to be made within the policy (for the insurance scheme).[25] The Court of Appeal found that the consideration of whether the payment sought to be recovered under s 71(1) was a ‘valid payment’ does not merely raise an element of the administrative review process ‘anterior to that payment’.[26] The issue of whether the payment was a valid payment under the scheme was found to be a ‘condition for recovery of the payment under s 71(1) of the Act’.[27]
- [27]I am not satisfied that the District Court has the jurisdiction to review the scope of works decision because as found by the Court of Appeal in Mahoney’s case, the ‘availability’ of review of decisions (such as to direct rectification and scope of works) provides a ‘sound rationale’ for a legislative intention that the decisions ‘not be justiciable’ in s 71(1) debt recovery proceedings.[28]
- [28]In Mahoney’s case Gotterson JA said that decisions by the authority (such as to direct rectification work and scope of works) conferred a review jurisdiction (in the Tribunal) and a decision to recover an amount under s 71(1) was judicially reviewable in the Supreme Court pursuant to the Judicial Review Act 1991.
- [29]I accept Mr Cooke’s oral submission that with the passage of time there is some disconnect between the administrative provisions in respect of reviewing the scope of works decision and the payment by the QBCC pursuant to the policy that Mr Cooke says the QBCC made to assist the homeowners. I do not accept, however, the balance of convenience favours a stay of the proceedings because this (a stay) will deprive Mr Russell of his administrative review rights in circumstances where he has filed applications to review decisions made and has sought a stay of the scope of works proceedings that was refused by the Tribunal on 28 March 2013.
- [30]I accept the QBCC’s submission that, consistent with the decision in Samimi’s case, the recovery proceedings under s 71(1) will require a consideration of whether the payment was a valid payment under the scheme. The District Court may consider the policy to determine whether the payment was ‘reasonable’. The Tribunal cannot predict with any certainty however the outcome of the District Court proceedings in particular how the District Court will determine the issue of ‘reasonableness’ for the purposes of clause 2.2 of the policy.
- [31]I do not accept the QBCC’s submission that there is little utility in proceeding with the administrative review proceedings. The issues in this matter are complex because there is a protracted history relating to work performed by Mr Russell and a consideration of expert evidence. In oral submissions, Mr Cooke for the QBCC submitted that evidence would need to be given about the expert report in the District Court proceedings.
- [32]The Tribunal has made findings about the direction to rectify and the unsatisfactory rectification work (applications GAR232-11 and GAR003-13). The Tribunal is therefore in a position in exercising its review function to narrow the issues in this matter. This is relevant to the considerations for the purposes of s 62 of the QCAT Act, in determining whether the Tribunal should give a direction. A direction to stay the matter for the purposes of s 62 of the QCAT Act is not necessary for the ‘speedy’ conduct of the proceedings. This is because the Tribunal has made decisions about the rectification of work and it can narrow any relevant issues and determine the application on review.
- [33]I do not accept Mr Cooke’s submission that the District Court will not consider any findings of fact made by this Tribunal in relation to the s 71(1) recovery proceedings. There is simply no factual or legal basis for making this submission particularly in circumstances where the QBCC says the District Court will consider issues of reasonableness in relation to the payment (under the policy) in the s 71(1) proceedings.
- [34]In this matter, Mr Russell has exercised his review rights in the Tribunal and has taken steps to preserve his rights by making an application to stay the scope of works decision. It would not be fair to Mr Russell for the purposes of s 62 of the QCAT Act to deprive Mr Russell of his review rights.
- [35]It is common ground that Mr Russell did not exercise his right to challenge by way of judicial review the QBCC’s decision to accept the homeowner’s claim under the insurance scheme. It is apparent from reading the Tribunal’s reasons in refusing Mr Russell’s application to stay the scope of works decision that the authority (the QBCC) informed Mr Russell that it (the QBCC) had decided to accept the homeowners’ complaint as a claim under the insurance scheme and then proceeded to assess the work. As the Tribunal said in refusing the stay, the QBCC has subrogated rights under s 77(3) of the QBCC Act irrespective of the direction to rectify. At this point in the proceedings, it is appropriate to ask the question of what more could Mr Russell do to preserve his rights? This requires a consideration of all of the matters before me.
- [36]In this case, Mr Russell exercised his review rights under s 86 of the QBCC Act to review the decisions made by the QBCC. Mr Russell applied to the Tribunal to stay the scope of works proceedings. The Tribunal refused the stay and effectively put the scope of the works proceedings on hold because it directed that the application (GAR067-13) be listed for a directions hearing after the direction to rectify and the unsatisfactory rectification of work decisions (GAR003-13 and GAR232-11) are determined by the Tribunal.
- [37]I am satisfied having considered all of the matters before me that Mr Russell has taken steps to exercise his review rights. I am not satisfied that in lieu of judicial review proceedings commenced by Mr Russell in relation to the QBCC’s decision to accept the claim (under the insurance scheme) is a reason to stay or transfer the proceedings to the District Court.
- [38]As held by the Court of Appeal in Namour v Queensland Building Services Authority[29] the scheme of the QBCC Act is that a building contractor (in this case Mr Russell) who wishes to challenge decisions such as a direction to rectify and scope of works to be undertaken should make the challenge before the QBCC pays under the policy. The Court of Appeal said that a building contractor who does not make such a challenge ‘is liable under s 71(1) whether or not one of those anterior decisions might have been the subject of a challenge’.[30] In this matter, Mr Russell filed applications in the Tribunal to challenge the QBCC’s decisions.
- [39]I am not satisfied that the balance of convenience favours a stay because the Tribunal has the jurisdiction to review the scope of works decision. I am not satisfied that it is necessary for the speedy and fair conduct of the proceeding to make a direction that the proceedings (GAR067-13) be stayed until the District Court s 71(1) proceedings are determined.
- [40]The Tribunal has made findings of fact about the direction to rectify and the unsatisfactory rectification of work. The Tribunal is now in a position to narrow the issues in reviewing the scope of works decision including issues in relation to the expert evidence that may also be relevant to the District Court s 71(1) recovery proceedings in determining ‘reasonableness’ for the purposes of the policy.
- [41]The Tribunal has also considered its objectives under s 3 of the QCAT Act that requires the Tribunal to deal with matters in a way that that is accessible, fair, just economical, informal and quick. In this case I am satisfied that the Tribunal is the more appropriate jurisdiction to determine the issues in relation to the scope of works decision and refusing the stay will enable the Tribunal to proceed with the review hearing so that it can meet its objectives.
- [42]For the reasons given, the application to stay the proceedings (GAR067-13) is refused.
Should the Tribunal transfer the proceedings (GAR067-13) to the District Court?
- [43]The Tribunal has the power to transfer the subject matter of a proceeding (or a part of that proceeding) to a court or another entity if it considers the matter would be more ‘appropriately dealt with’ by that court.[31] If the Tribunal considers it does not have jurisdiction to hear all matters in a proceeding, the Tribunal may make an order to transfer the matter or matters for which it does not have jurisdiction to a court or entity that has jurisdiction.[32]
- [44]In Henderson & Anor v The Body Corporate for Merrimac Heights,[33] McMurdo J said that s 52 of the QCAT Act does not confer jurisdiction upon other courts or tribunals but rather permits the Tribunal to transfer (the matter) to a court ‘where that entity has jurisdiction to determine the proceeding’.[34]
- [45]The QBCC submits that the District Court can give final relief in respect of the payment (under s 71(1)). The QBCC submits that the matter (application GAR067-13) should be transferred to the District Court because there is an issue of costs that can be saved because the District Court will consider issues in the s 71(1) proceedings that the Tribunal (on review) will also consider.[35]
- [46]I have found that the District Court does not have jurisdiction to review the scope of works decision because the proceedings before it (in the District Court) relate only to the recovery of the s 71(1) payment as a debt from Mr Russell. There is no defence to the s 71(1) proceedings and the QBCC is entitled to recover the money if it has made a payment on a claim under the insurance scheme.[36]
- [47]I have found that a stay of the administrative review proceedings (GAR067-13) will deprive Mr Russell of his right to a merit review of the scope of works decision. I have found that Mr Russell took appropriate steps to review the decisions made by the QBCC because he filed applications in the Tribunal and applied for a stay of the scope of works decision that was refused by the Tribunal. I have also found that to refuse the stay will enable the Tribunal to meet its objectives under the QCAT Act because it can quickly proceed to a hearing that will determine the issues relevant to the application (GAR067-13).
- [48]I am not satisfied that the issue of costs as contended by the QBCC is a relevant consideration in determining whether the proceedings (GAR067-13) should be transferred to the District Court. The usual order in relation to costs under the QCAT Act is that each party bear its own costs for the proceedings.[37] The Tribunal can only make an order for costs upon application being made by a party in the proceeding if it considers the interests of justice require it to make the order.[38]
- [49]The Tribunal cannot predict with any certainty the outcome of the review proceedings and whether in the event an application for costs is made by a party to the proceeding, the Tribunal will be satisfied the interests of justice require a costs order to be made. The District Court does not have the same starting principle in respect of costs (each party bear own costs) as QCAT.
- [50]I am not satisfied that the matter should be transferred to the District Court in the interests of costs because I have found that the Tribunal is the more appropriate jurisdiction to determine the issues in the scope of works review proceedings. This is because the Tribunal has made findings of fact that may be relevant to the proceeding and it is in a position to narrow the issues relating to the expert evidence and can determine the matter quickly in meeting its objectives under the QCAT Act.
- [51]For the reasons given, the application to transfer the matter (GAR067-13) to the District Court is refused.
Footnotes
[1] Russell v Queensland Building Services Authority [2013] QCAT 329, [7].
[2] Ibid, [8].
[3] Ibid, [8].
[4] Ibid, [9].
[5] Russell v Queensland Building Services Authority [2014] QCAT 094.
[6] Ibid, [78].
[7] Exhibit 1, attachment marked ‘REO-5’.
[8] QBCC Act s 71(1).
[9] Application for miscellaneous matters filed on 25 June 2015. At the oral hearing Mr Cooke for the respondent abandoned the application to dismiss the proceedings (GAR067-13).
[10] At the oral hearing Ms Ahern for the applicant abandoned the application filed on 29 June 2015 seeking an order that the application (GAR067-13) be determined on a summary basis in favour of the applicant.
[11] Kuligowski v Metrobus [2004] 220 CLR 363.
[12] Ibid, at 374.
[13] Submissions on behalf of the respondent filed on 16 July 2015, p 1.
[14] QCAT Act, ss 58 and 59.
[15] Chras Straker Pty Ltd as trustee for Dianne Crea Family Trust and Anor v Orsay Holdings Pty Ltd [2011] QCAT 676, [10].
[16] QCAT Act s 62.
[17] Submissions on behalf of the respondent filed on 16 July 2015, [12].
[18] Ibid.
[19] Ibid, [17].
[20] Exhibit 4.
[21] Samimi & Anor v Queensland Building and Construction Commission [2015] QCA 106, [30], Mahoney v Queensland Building Services Authority [2013] QCA 323, [34] and Namour v Queensland Building Services Authority [2014] QCA 72, [24]-[25].
[22] Mahoney v Queensland Building Services Authority [2013] QCA 323.
[23] Namour v Queensland Building Services Authority [2014] QCA 72.
[24] Samimi & Anor v Queensland Building and Construction Commission [2015] QCA 106, [30].
[25] Ibid, [31].
[26] Ibid, [38].
[27] Ibid.
[28] Ibid, [35].
[29] [2014] QCA 72.
[30] Ibid, [19].
[31] QCAT Act s 52.
[32] Ibid.
[33] [2011] QSC 336.
[34] Ibid, [113].
[35] Submissions on behalf of the respondent filed on 16 July 2015.
[36] Mahoney v Queensland Building Services Authority [2013] QCA 323.
[37] QCAT Act s 100.
[38] Ibid s 102.