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Luscombe v Queensland Building and Construction Commission[2019] QCAT 13

Luscombe v Queensland Building and Construction Commission[2019] QCAT 13

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:

Luscombe v Queensland Building and Construction Commission [2019] QCAT 13

PARTIES:

TONY JASON LUSCOMBE

(applicant)

v

QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION

(respondent)

APPLICATION NO/S:

GAR055-17

MATTER TYPE:

General administrative review matters

DELIVERED ON:

23 January 2019

HEARING DATE:

15 October 2018; 16 October 2018; 17 October 2018;

18 October 2018; 26 October 2018

HEARD AT:

Brisbane

DECISION OF:

Member Kanowski

ORDERS:

  1. Except in respect of direction to rectify 42 issued on 13 February 2017, the decision of the Queensland Building and Construction Commission to issue directions to rectify to Tony Jason Luscombe is set aside and a decision is substituted not to issue directions to rectify.
  2. The decision to issue direction to rectify 42 on 13 February 2017 is confirmed.

CATCHWORDS:

PROFESSIONS AND TRADES – BUILDERS – STATUTORY POWER TO REQUIRE RECTIFICATION OF DEFECTIVE OR INCOMPLETE BUILDING WORK whether work defective or incomplete – whether unfair to require rectification

Queensland Building and Construction Act 1991 (Qld), s 3, s 72

Duke Building Pty Ltd v Queensland Building and Construction Commission & Ors [2015] QCAT 397 Middleton v Queensland Building and Construction Commission [2018] QCAT 177

R v His Honour Judge Miller and the Builders’ Registration Board of Queensland, ex parte Graham Evans & Co. (Qld) Pty Ltd [1987] 2 Qd.R. 446

APPEARANCES & REPRESENTATION:

Applicant:

Gadens Lawyers

Respondent:

HWL Ebsworth Lawyers

REASONS FOR DECISION

Introduction

  1. [1]
    This case is about whether Mr Luscombe should have been directed to rectify building work on a house at The Gap. The property is an elevated bushland site. The owner, Ms Kill, engaged Mr Luscombe to build the house. The contract was signed on 23 October 2013. It named Ms Kill’s husband, Mr Cockburn, as Ms Kill’s representative for the contract. Work commenced in about late October 2013. Mr Luscombe and his employees and subcontractors undertook extensive work over the following year or two but the parties fell into dispute before the house was finished. Lawyers were engaged but agreement was not reached. Ms Kill then terminated the contract on 13 October 2015.
  1. [2]
    Ms Kill made a complaint about Mr Luscombe’s building work to the Queensland Building and Construction Commission (‘QBCC’). After an inspection, QBCC issued directions to rectify to Mr Luscombe on 27 April 2016. Both Mr Luscombe and Ms Kill asked QBCC to review its decision. An internal review officer varied the decision on 8 February 2017, after a further inspection. This resulted in a new set of directions to rectify, dated 13 February 2017. This set contains 68 directions. This large number might create a misleading impression because in many instances a single identified problem resulted in a separate direction for each place in the building where that problem existed as well as a cover-all direction. There is also some other duplication.
  2. [3]
    Mr Luscombe has applied to the Tribunal for an external review of QBCC’s decision. Mr Russell Ensbey of Gadens Lawyers represented Mr Luscombe at the hearing, while Ms Stephanie Hedger of HWL Ebsworth Lawyers represented QBCC. Oral evidence was given in Mr Luscombe’s case by Mr Luscombe, his site supervisor John De Lang, and Norman Bergin (a building consultant engaged as an expert witness by Mr Luscombe), and in QBCC’s case by Raithlin Trohear (a QBCC building inspector). There were 13 exhibits consisting of statements, reports, attachments, guidelines and so on. I also received a Scott Schedule, in which the parties set out particulars and their positions on each direction, and written submissions from each representative on 26 October 2018.
  3. [4]
    References to the numbered directions to rectify in these reasons will be to the set of 68 directions issued on 13 February 2017.

Legal framework

  1. [5]
    Where building work is defective or incomplete, QBCC may direct the builder to rectify the work.[1] QBCC is not required to direct rectification if satisfied that, in the circumstances, it would be unfair to the builder to give the direction.[2]
  2. [6]
    QBCC has a Rectification of Building Work Policy[3] which relevantly provides, in summary, that:
    1. (a)
      defective building work is work that is faulty or unsatisfactory and includes, for example, work that:
      1. does not comply with the Building Code of Australia or an applicable Australian Standard; or
      2. involves the use of a manufactured product, and the product has been installed in a way that does not comply with the manufacturer’s instructions;
    2. (b)
      defective building work includes work that does not meet a reasonable standard of construction or finish expected of a competent builder; and
    3. (c)
      a builder who has carried out defective building work should be required to rectify unless in the circumstances rectification is unfair or unreasonable.
  3. [7]
    The Tribunal will ordinarily follow such policy, in order to foster consistency in decision-making, unless there is a cogent reason to do otherwise in a particular case.
  4. [8]
    In deciding whether to exercise the discretion to direct rectification, it is useful to bear in mind the objects of the QBCC Act. Relevantly, these include, in summary:[4]
    1. (a)
      providing remedies for defective building work; and
    2. (b)
      regulating the building industry to ensure the maintenance of proper standards, and to achieve a reasonable balance between the interests of builders and consumers.
  5. [9]
    The cause of a defect, and any blameworthiness of the owner, will be relevant considerations.[5]
  6. [10]
    The Tribunal must consider the matter afresh, and reach what it considers to be the correct and preferable decision.[6]

Overview of Mr Luscombe’sposition

  1. [11]
    Broadly speaking, Mr Luscombe’s position is that some of the work that QBCC has regarded as defective is not unsatisfactory at all. The remainder of the work largely reflects its incomplete state. These problems would have been ironed out in the normal course, he says, had Ms Kill not terminated the contract before the project was finished. Some of the problems arose, Mr Luscombe says, from Ms Kill’s conduct. This included engaging an unlicensed painter and, in October 2014, moving her family in to the incomplete house without consultation. Mr Luscombe says that several design changes became necessary as work progressed, yet Ms Kill refused to obtain revised plans, failed to agree to necessary variations, declined to advise what she wanted done, and so on.
  1. [12]
    Mr Luscombe emphasises what he says was the unusual nature of the project. In summary, he says the owner’s husband Mr Cockburn was a friend. Mr Luscombe had previously undertaken major renovations for Mr Cockburn on a property at Albion. Mr Cockburn had effectively been the project manager. Mr Cockburn assumed a similar role at The Gap. He was frequently on site directing operations. Mr Cockburn was administering a tight budget and this led to many of the problems. At Mr Cockburn’s insistence, Mr Luscombe was prepared to carry out work that differed from the approved plans. This was because Mr Cockburn was a friend, and Mr Luscombe expected that things would be sorted out amicably in due course.
  2. [13]
    In these circumstances, Mr Luscombe contends, directions to rectify are either unwarranted or unfair.

Should the Tribunal accept Mr Luscombe’s evidence about the project?

  1. [14]
    There is no testimony from Ms Kill or Mr Cockburn. Mr Luscombe’s evidence about his dealings with them is therefore uncontradicted. His evidence is broadly corroborated by Mr De Lang’s. Of course Mr De Lang is not an independent witness. There were signs of loyalty to Mr Luscombe in some of Mr De Lang’s evidence. He did, though, seem to be an honest witness. Further, several aspects of Mr Luscombe’s account of events are backed up by email and other records. They do, for example, show a high level of hands-on involvement by Mr Cockburn during construction. Overall, Mr Luscombe’s account of events is plausible. I see no reason not to accept his evidence about the project.

Overview of QBCC’s position

  1. [15]
    At the outset of the hearing, QBCC acknowledged that some problems have since been satisfactorily rectified. On this basis, QBCC invited the Tribunal to set aside the decision to issue directions to rectify 1 to 4, 9, 28, 33, 48 and 57. As there is no disagreement about these, I do not propose to discuss them further.
  2. [16]
    So far as the remaining directions are concerned, broadly speaking QBCC’s position is that overwhelmingly the work was not merely incomplete but inherently defective for one reason or another. Mr Luscombe is the licensed builder and ultimately he must take responsibility for rectifying such work. Actions or inactions of the owner and her husband can be relevant to whether the discretion to direct rectification is exercised, but directions to rectify are appropriate in this case, QBCC argues.

Other relevant background matters

  1. [17]
    Before considering various aspects of the building work, it is desirable to note some features of the site and the construction contract.
  1. [18]
    Firstly, the site is classified as bushfire prone. Ms Kill had obtained a bushfire management plan which was prepared by a specialist firm.
  2. [19]
    Secondly, the contract specified that the owner, rather than the builder, was required to obtain building and other required approvals. The owner was to provide the plans. Further, the owner warranted the accuracy of the plans and the suitability of the design specified in the plans. Ms Kill provided the design plans that were used. These had been prepared by engineering and design consultants.
  3. [20]
    Thirdly, neither party has invited me to draw any conclusion about whether Ms Kill was entitled to terminate the contract. Without evidence from Ms Kill, I do not believe that I could reliably reach a conclusion on the point. Accordingly, I refrain from making any finding on that issue.

Cladding

  1. [21]
    A substantial number of the directions to rectify relate to the external cladding. The house is large with extensive areas of cladding. It is undisputed that the approved plans were for a brick exterior but in the course of construction an engineer advised that a brick veneer would be too heavy for the site. It was instead decided to switch to lightweight sheet cladding. A two-layered system was adopted. There is an inner layer of plasterboard and an outer layer. In some places the outer layer is Hardie Tex, which is generally referred to as blueboard. In other places the outer layer is Scyon Axon. Mr Luscombe says, and I accept, that Mr Cockburn declined to obtain revised plans to reflect this design change, and associated design changes, because of cost constraints.
  2. [22]
    QBCC submits that the cladding work failed to comply with the manufacturer’s installation guide in various respects, including that:
    1. (a)
      sheets have been installed horizontally rather than vertically;
    2. (b)
      offcuts rather than cut-outs were used in the front entry foyer;
    3. (c)
      expansion joints of 6 millimetres had mostly not been included – with some minor hairline cracks having appeared in some blueboards as a result – and some gaps that were retrospectively installed were not spaced as recommended;
    4. (d)
      at various places, at least, sheets were fixed to studs of only 35 millimetres, instead of the recommended 42 millimetres or greater;
    5. (e)
      some nails were driven in at the wrong places, or were overdriven;
    6. (f)
      for some sheets, the spaces between nails were not as recommended;
    7. (g)
      in some places, blueboard was in direct contact with the ground, contrary to clearance recommendations; and
    8. (h)
      in some places there were gaps or damaged sections of trim.
  3. [23]
    QBCC submits that the degree of departure from the manufacturer’s recommendations is such that all of the cladding should be removed and replaced.
  1. [24]
    Direction to rectify 60, although grouped separately, also relates to Scyon Axon trim. It is to the effect that part of the trim below a window sill in the main bathroom is not flush with the sill.
  2. [25]
    Mr Luscombe’s evidence may be summarised as follows. The manufacturer’s recommendations apply to single-layer systems, but here a multi-layer system had to be used because of the fire-prone nature of the site. Sheets were laid horizontally at Mr Cockburn’s insistence, for aesthetic reasons. Mr Cockburn had discussed cladding methods and trims at length with the supplier’s representative and carpenters on site, and he was clear about how he wanted the cladding installed, the type of trim, and so on. Mr Cockburn did not want large expansion joints in certain areas. Mr Luscombe concedes that studs in some places were less than 42 millimetres, and he started to rectify this but he was awaiting new plans which Ms Kill never provided. The cladding has performed satisfactorily despite the issues identified by QBCC, as there has been no water ingress or sheet movement. Any shortcomings in the finish should be regarded as incomplete work, reflecting the fact that he did not have the chance to complete the construction because of early termination of the contract, rather than as defective work. Cladding touched the ground at certain points but this was only a temporary measure required to keep out vermin during construction because Ms Kill had moved her family into the house prematurely.
  3. [26]
    Several of these points are echoed by Mr Bergin, whose evidence may be summarised as follows. Mr Bergin also takes the view that the manufacturer’s recommendations apply to single-layer systems. Expansion joints are required for blueboard only where wall length exceeds four metres, and some of the walls in question are under four metres. However, Mr Bergin acknowledges that this relaxation is based on his judgment rather than a manufacturer’s guideline. The manufacturer’s recommendation for 42 millimetre studs would reflect reliance on the sheets for bracing purposes. This was not required here. For the same reason there is no problem with horizontal placement of the sheets, which has a better aesthetic effect than vertical placement in long walls. The use of offcuts in the entry foyer allowed a neater finish, and was quite reasonable. Several of the matters relied on by QBCC are minor ones, in Mr Bergin’s opinion, and could ordinarily have been addressed in the course of completion such as by attending to overdriven nails and adding control joints in certain places.
  4. [27]
    QBCC’s arguments in response may be summarised as follows. Manufacturers’ recommendations should not be dismissed as irrelevant merely because a multi-layer system was used. The Knauf plasterboard specifications indicate that other sheeting can be used on top so long as it is installed in accordance with its manufacturer’s specifications. In the absence of approved drawings, it was therefore reasonable to apply the James Hardie recommendations in respect of its products namely the blueboard and Scyon Axon. It is somewhat disingenuous of Mr Luscombe to have carried out work without approved plans but to now resist rectification because of the absence of approved plans. He should have ensured that he had approved revised plans before carrying on work. So far as any temporary work is concerned, building work should meet requirements whether temporary or permanent: Middleton v Queensland Building and Construction Commission.[7] Further, the relatively short term performance of a building is not decisive; performance over the long term is vital.
  1. [28]
    It is clear that there are shortcomings in the fixing of the cladding which would not be acceptable in a finished building. Whether these shortcomings are classified as defective work or incomplete work is not itself critical in this instance. I do, however, accept Mr Bergin’s opinion that the deviations from the manufacturer’s recommendations were, variously, not of significance in the circumstances or capable of correction in the normal course of completion. Mr Bergin struck me as an experienced and sensible building expert who took a quite balanced approach.
  2. [29]
    Mr Luscombe was prevented from carrying out normal completion works because of the termination of the contract. I am mindful of QBCC’s general submission that the owner:[8]

"… was clearly prepared to give Mr Luscombe access to the property for the purposes of performing rectification works notwithstanding the termination of the contract between them."

  1. [30]
    However, it does not follow in my view that Mr Luscombe can fairly be obliged to bring the project closer to completion that it was, or should have been, at the time of termination.
  2. [31]
    The conduct of the owner in insisting that the builder deviate from the approved plans, and her refusal to obtain and seek approval for revised plans, is also of significance. Of course the sensible course for Mr Luscombe would have been to refuse to carry on without revised and approved plans. He took a risk in carrying on, which he probably now regrets. However, he was placed in a difficult position because of his relationship with the owner’s family. Mr Cockburn was a knowledgeable consumer and he too took on a risk, on his wife’s behalf, in insisting on progress without a proper redesign process. Design was the owner’s responsibility under the contract. Had a proper redesign process been undertaken, presumably many of the departures from the manufacturers’ recommendations would have been either avoided or justified.
  3. [32]
    I also accept Mr Luscombe’s evidence that the contact between sheets and the ground occurred only as a temporary measure that became necessary when the owner moved her family into the house early, without consultation.
  4. [33]
    In all of these circumstances, I consider that problems with the cladding are predominantly the result of conduct of the owner and the early end to the project. In these circumstances, on balance, I consider it would be unfair to require Mr Luscombe to carry out rectification of the cladding.

Flashings

  1. [34]
    Another substantial number of the directions to rectify relate to the flashings or lack of flashings. The purpose of flashings is to prevent water ingress. Window and door openings have not been flashed with head flashings. QBCC submits the ‘prescriptive requirement’ in the Building Code of Australia is for head flashings, and while the Code does envisage the possibility of using alternative means to prevent water ingress, the prescriptive requirement should have been met in this case in order to ensure long term performance. QBCC also submits that James Hardie also recommends head flashings where blueboard and Scyon Axon are used. The use of a weatherproof sealant would not, in QBCC’s submission, offer the same long term protection as a head flashing.
  1. [35]
    QBCC’s submissions reflect the views of Mr Trohear. I am satisfied that he is an experienced building expert whose opinions should be given significant weight.
  2. [36]
    On the other hand, the views of the other expert, Mr Bergin, differ. His expertise is also well-established. His evidence may be summarised as follows. Head flashings are not generally practical for widespread use in a multi-layer sheeting system in a fire-prone area, though Mr Bergin would use them for any doors in exposed areas. The spacing and material compromise fire protection, and head flashings tend to attract water to the underlying, porous, plasterboard. Mr Bergin considers that the owner should provide other approved window trim detail.
  3. [37]
    On balance, I am inclined to prefer the opinion of Mr Bergin on this issue. He has some qualifications in fire safety design and he has conducted fire safety audits for a telecommunications company for three years. I consider that he has greater expertise in the field of fire safety than Mr Trohear.
  4. [38]
    The following is a summary of Mr Luscombe’s evidence. He agrees with Mr Bergin’s comments about problems in using head flashings. In any event, Mr Cockburn did not want them for aesthetic reasons. The owner failed to provide alternative approved plans. In the absence of such plans, Mr Luscombe intended to carry out further waterproofing measures, including the use of a sealant, but the contract was terminated before this was done.
  5. [39]
    In response, QBCC submits that Mr Luscombe, as the licensed builder, should have ensured that works complied with the Building Code of Australia. Alternatively, he should at least have warned Mr Cockburn of the implications of deviating from the Code and obtained instructions in writing if Mr Cockburn wished to persist.
  6. [40]
    I accept that this submission would have strong force in a more conventional situation where the homeowner relies on a builder’s greater expertise in design. However, it has less force in a situation such as the present where an owner has taken on responsibility for design, her representative has been very involved in the project, and yet the owner has declined to have a redesign done and approved when one was needed.
  7. [41]
    Clearly the work was, at least, incomplete, and in some respects it may have been defective. As to whether the discretion to order rectification should be exercised, the relevant factors here are similar to those considered in relation to the cladding. In my view, the problems fundamentally arose because the owner refused to obtain a proper redesign once the brick veneer proposal was abandoned. Further, Mr Luscombe did not have the opportunity to complete the project. Again therefore, on balance, I consider it would be unfair to Mr Luscombe to require him to rectify.

Termite management system

  1. [42]
    A substantial number of directions to rectify relate to the termite management system. It is undisputed that the directions were issued on the basis that a Kordon termite barrier system was the intended system. The Kordon system appears to involve a chemical barrier applied around foundation slabs. QBCC says that the system as installed at the house is defective because there are a number of ‘concealed termite entry points’: points where termites can enter into the building without detection. There are also ‘bridging points’ such as a pipe, and ‘non-conforming ground clearances’ where cladding sheets are touching the ground. Further, QBCC submits that a step which had been installed by Mr Luscombe in response to one of the initial directions to rectify had created a concealed termite entry point because there is not a 75 millimetre inspection zone as required by the relevant Australian Standard.
  1. [43]
    Mr Bergin considers the Kordon system as installed to be incomplete but he also thinks there are options available to complete an effective termite management system in consultation with a licensed installer.
  2. [44]
    Mr Luscombe’s evidence may be summarised as follows. The contract called for a Termimesh system but Mr Cockburn requested the use of Kordon instead. Mr Luscombe subcontracted the licensed installers Sherry’s to install the system. He shares Mr Bergin’s view that the system can be made effective, and contends that to the extent that it is not yet effective the work should be regarded as incomplete rather than defective. For example, the pipe mentioned by QBCC was installed in his absence at the direction of Ms Kill. Normally, this would have been corrected prior to completion of the project. Similarly, as previously discussed, the contact between cladding sheets and the ground was a temporary measure. Mr Luscombe disputes Mr Trohear’s opinion that there is not a proper inspection zone for the new step. Many of the concealed entry points are associated with forced changes to construction because of design changes caused by incorrect levels in the approved plans and other factors. Efforts to complete an effective termite management system stalled when the parties to the construction contract fell into dispute and Ms Kill failed to provide revised plans or instructions on how to proceed in the meantime.
  3. [45]
    Further, Mr Luscombe says he considered that a range of termite protection strategies should be used because of the bushland setting and the design changes. Sherry’s recommended the use of treated timbers. Accordingly, he used copper chrome arsenic (‘CCA’) treated timbers in all required elements except, by oversight, the skirting boards.
  4. [46]
    It is undisputed that ply wood used under roofing sheets was not CCA treated, but the parties disagree about whether it should have been. This turns on whether it is a ‘primary building element’ as defined in the Building Code of Australia. I do not consider it necessary to resolve that dispute. This is because the directions to rectify relate to the Kordon system. Whether any supplementary system is adequate is beside the point. It is undisputed that an effective Kordon system was contemplated by the parties to the building contract, and that the system in existence when the contract was terminated was not fully effective. There was, therefore, either defective or incomplete work.
  5. [47]
    In my view it is properly characterised as incomplete work. It is apparent that the bulk of the Kordon system had been installed but there are a number of places where corrective work is required. I accept Mr Luscombe’s evidence that this situation resulted mainly from the owner’s conduct: providing faulty designs, intransigence about updating design when required, directing where a pipe was to be installed, and moving into the house prematurely. I am satisfied that Mr Luscombe attempted to have the matter resolved by discussions with Mr Cockburn, and through communications between lawyers prior to termination of the contract. He then lost the opportunity to complete the work. In these circumstances, it is unfair in my view to require Mr Luscombe to rectify.

Main deck and laundry courtyard deck

  1. [48]
    A sheeting product called Scyon Secura was used as the flooring substrate on the decks. Some of the directions to rectify relate to that flooring on the main deck and the much smaller laundry courtyard. Both of these decks are on the lower floor. QBCC submits that certain work is defective in that it does not comply with the manufacturer’s recommendations. Firstly, the step down from the house is only 25 millimetres but the recommendation is for at least 50 but preferably 150 millimetres. Secondly, there is no outward fall to the deck floor but the recommendation is for a minimum 1:100 fall. Thirdly, the deck edge does not have the 40 to 60 millimetre overhang that is recommended. Fourthly, there is no evidence of the recommended flashing or waterproofing to the perimeter of the deck.
  2. [49]
    Having regard to the written submissions of QBCC,[9] it may be that the relevant directions extend to the main bedroom deck as well. However, I could not locate a direction that seemed to pick up on these aspects for that deck, though I note that in the Scott Schedule the lack of fall is mentioned in relation to direction 53 which relates to the main bedroom deck. Perhaps direction 19, which is identically worded to direction 18, was intended to refer to the main bedroom deck. If so, the reasoning below that relates to the main deck would be applicable.
  3. [50]
    QBCC says that a handrail on the laundry courtyard deck has been fixed directly through the tile and the membrane system, if there is one. The deck is leaking as a result. Further, at the main deck, there has been water entry into the house at the edge of a sliding door opening onto the deck. Direction to rectify 68 presumably relates to the same door. The direction is to the effect that the door has not been installed in accordance with the relevant Australian Standard in that there is no visible evidence of a band of waterproof membrane, sub sill or flashing to the underside of the bottom track.
  4. [51]
    QBCC’s submissions are based on Mr Trohear’s opinion. Mr Bergin has also considered the decks. Mr Bergin notes an Australian Standard requiring a 100 millimetre set down as well as a 1:100 fall, and otherwise agrees with several of Mr Trohear’s criticisms such as in relation to the lack of fall in the main deck. There may be some difference of opinion about whether or how readily flashing and waterproofing shortcomings could be satisfactorily rectified in the existing structures. Mr Bergin does not consider the as-built set downs to be adequate on the decks facing south-easterly (which I infer would include the main deck), but considers that the set down to the laundry courtyard deck, which is on the opposite side of the house, ‘will be adequate due to the location and protection’.[10] Presumably because of the protected location of the laundry courtyard deck, Mr Bergin says that the deck ‘had adequate fall’.[11]
  5. [52]
    Mr Bergin says that a 25 millimetre set down to all decks was required by the approved drawings.[12] Unfortunately, the copies of the approved drawings in the exhibits are in tiny print. However, on my reading of drawing 11118 sheet 2, I believe it specifies for the main deck ‘Compressed FC sheeting to be set 25 below adjacent main floor’, and for the laundry courtyard ‘Compressed FC sheeting to be set 175 below adjacent main floor’. I take these to be references to 25 and 175 millimetres respectively. I infer, therefore, that the set down for the main deck was compliant with the approved plans, but non-compliant for the laundry courtyard.
  1. [53]
    Mr Luscombe’s evidence may be summarised as follows. Mr Cockburn did not want a substantial set down of the decks (for health reasons) or an outward fall (for stability of outdoor furniture). The approved plans did not require a fall. Mr Luscombe warned Mr Cockburn that the lack of fall could be problematic. As Mr Cockburn wanted coping tiles on the edges of the decks, an overhang was not possible. A waterproofing membrane has not yet been applied. Flashing to the main deck was not installed because he had been waiting for Mr Cockburn to decide about the proposed relocation of a door. It would be unfair to require Mr Luscombe to alter the set down when he built in accordance with the specifications and owner’s instructions. Further, the laundry courtyard deck cannot be lowered because of the proximity to the footing, and Mr Cockburn was made aware of this during construction. The leaking in the laundry courtyard deck is the result of Ms Kill occupying the home before it was finished: she used the handrail before it was finished and this cracked tiles, and she kept dogs on that deck and hosed the area excessively.
  2. [54]
    QBCC’s arguments in response may be summarised as follows. It was incumbent on Mr Luscombe as the licensed builder to ensure that work met minimum requirements. If he wished to act on contrary instructions from the owner, he should have warned the owner and obtained written instructions. Further, the relevant Australian Standard allows an alternate solution to a step down namely a grated drain, where for some reason a set down is not appropriate. However, grated drains were not installed.
  3. [55]
    As noted earlier, I accept Mr Luscombe’s evidence of his dealings with Ms Kill and Mr Cockburn. Accordingly, I accept that Mr Luscombe followed their wishes about set down and fall, and that Mr Luscombe told Mr Cockburn that the lack of fall could be problematic. The set down for the main deck is in accordance with the approved drawings, but the set down for the laundry courtyard deck is not. The set down and the lack of fall for both decks fail to comply with an Australian Standard and the manufacturer’s recommendations. I accept Mr Bergin’s opinion that the set down and fall of the laundry courtyard deck are adequate in practice, because of its protected location. I have no reason to doubt Mr Luscombe’s evidence that premature occupation of the home led to problems with the handrail on the laundry courtyard deck. Hosing by an owner would not ordinarily be regarded as unexpected use, but in this case I regard it as a contributing factor because waterproofing measures had not been completed.
  4. [56]
    I find that some aspects of the deck work, to do with flashing, installation of membrane, finishing of edges with coping tiles, repair of handrail etc. was essentially incomplete work. I accept that it would have been fixed or completed in the ordinary course of completion but this was forestalled by termination of the contract. In my view it would be unfair to require Mr Luscombe to rectify those aspects.
  5. [57]
    The set down and fall issues are more contentious. So far as the laundry courtyard deck is concerned, even though the set down did not comply with the approved drawings, and the fall did not comply with the Australian Standard or the manufacturer’s recommendation, I do not think the deck flooring can be regarded as faulty or unsatisfactory. This is because I accept Mr Bergin’s opinion that the deck will perform satisfactorily. Accordingly, I find that those aspects of the work were not defective (or incomplete). I do not read the Rectification of Building Work Policy as mandating a finding of defective work in every instance where an Australian Standard or a manufacturer’s recommendation is not met.
  1. [58]
    So far as the main deck is concerned, the lack of fall is objectively unsatisfactory despite the wishes of the owner and the owner’s decision not to heed the builder’s warning. That aspect of the work is, I find, defective. So far as the set down is concerned, that too is objectively unsatisfactory, again despite the wishes of the owner. I find that the set down is defective. The fact that it complied with the approved drawings does not remove such work from the category of ‘defective’: R v His Honour Judge Miller and the Builders’ Registration Board of Queensland, ex parte Graham Evans & Co. (Qld) Pty Ltd (‘Miller’).[13] However, it is a factor that would be relevant in deciding whether to exercise the discretion to order rectification. As Derrington J noted in Miller,[14] in some cases the builder should not be required to rectify such work but:

"… [in] some circumstances, there is obvious need for protection of the owner even though the builder may be able to point to a term of the contract justifying the defective result …"

  1. [59]
    The present case, in my view, is one where on balance the discretion to order rectification should not be exercised. The deck was built in the way it was because of the express wishes of a knowledgeable owner, which were reflected in the approved drawings so far as set down is concerned. While valid criticism can be made of Mr Luscombe for persisting with the work out of loyalty to his friend even though he foresaw a problem, and for his failure to obtain written instructions, I consider that overall that it would be unfair in the circumstances to require Mr Luscombe to incur the expense involved in going back and changing these fundamental aspects of the construction.

Main bedroom deck

  1. [60]
    This deck is on the upper floor. Direction to rectify 53 says, in summary, that the installation of building elements at the sliding door and deck have not been done in accordance with the Building Code of Australia in that there is a leak ‘to the deck’. The wording of the direction is not very illuminating but the explanation in the Scott Schedule refers to:
    1. (a)
      the Building Code of Australia requirement for a building to be constructed to provide resistance to moisture from outside and moisture rising from the ground;
    2. (b)
      gaps between the sliding door frame and the external building fabric which may be allowing water ingress to the soffit below;
    3. (c)
      evidence of water entry under the door indicating a lack of adequate flashing or waterproofing;
    4. (d)
      a need to remove elements to install a waterproofing membrane; and
    5. (e)
      no visible fall in the Scyon Secura flooring.
  1. [61]
    My earlier comments about the fall issue apply equally here.
  2. [62]
    So far as the other matters are concerned, Mr Luscombe’s evidence may be summarised as follows. Mr Cockburn has given inconsistent accounts of the extent of any water damage. Work in this area has not been finished, for example the trim has to be finished and silicone applied. Mr Luscombe was unable to complete the work because Ms Kill would not give instructions on how she wanted the work done. The deck could not be lowered because of an air-conditioning duct below.
  3. [63]
    It is clear that the work had not been completed. In the circumstances, I consider it is more accurately classified as incomplete, rather than defective, work. I accept Mr Luscombe’s evidence that he did not complete the work because of communication problems with the owner and the termination of the contract. In these circumstances, I consider it would be unfair to require Mr Luscombe to rectify.

Soffits

  1. [64]
    Direction to rectify 20 relates to the fire resistance of soffits in the areas of the main deck, main bedroom deck and entry foyer. QBCC submits that certain bushfire attack levels need to be achieved but have not been because of the lack of suitable insulation. Therefore compliance with the Building Code of Australia is not achieved and so, QBCC submits, the work is defective.
  2. [65]
    Mr Bergin in his report agrees that the system does not achieve the required fire resistance level. He characterises the work as incomplete.
  3. [66]
    Mr Luscombe’s evidence may be summarised as follows. The work is significantly incomplete. The ceiling shown in approved plans for the main deck, at 3 metres, is yet to be installed. The current ceiling is at 4.5 metres. It was unclear from the plans whether the relevant bushfire attack level for the deck was FZ or 40, and he was awaiting clarification from the owner. Input from the certifier was also required for the sheeting used generally for these ceiling areas. The owner was intending to penetrate the sheeting to install lighting, and this too required input from the certifier.
  4. [67]
    I accept Mr Luscombe’s evidence and find that the work is incomplete. In my view it would be unfair in the circumstances to require rectification given that the project was cut short.

Water damage to cladding sheets touching the ground

  1. [68]
    These sheets have previously been mentioned in relation to termite access. Direction 24 relates to the potential for water damage.
  2. [69]
    I accept that this work is defective but I have also accepted that the placement of the sheets in this manner was a temporary measure. Work that is temporary can still be defective.[15] However, the circumstances in which temporary work was done can be relevant in deciding whether to exercise the discretion to direct rectification. In the circumstances of this matter, where the temporary work became necessary because of the conduct of the owner, and Mr Luscombe was not able to complete the project, it would not be fair to require him to rectify.

External stairs and retaining wall near family room

  1. [70]
    These are concrete stairs and an adjacent retaining wall. There are a number of directions to rectify, variously focussing on concealed termite entry points and the lack of provision for water escape from a void.
  2. [71]
    My earlier comments in relation to termite management apply here as well.
  3. [72]
    Mr Luscombe says the construction of these elements necessarily differed from the approved plans, as inaccuracies in the levels specified in plans became apparent, but the work was done at the request of the owner. However, the owner did not obtain amended approved plans.
  4. [73]
    So far as the water issue is concerned, Mr Trohear in cross-examination acknowledged that the issue could be addressed by capping, and that accordingly the work could be classified as incomplete rather than defective. QBCC submits that a direction to rectify is nonetheless appropriate because the work remained incomplete for more than a year before termination of the contract. Further, noting that Mr Luscombe had relied on the fact that the owner had not signed a variation for the completion of this work, QBCC also notes that the variation request was not made until approximately a year after the work had been carried out.
  5. [74]
    It is true that variation requests were made for a number of items quite late in the piece. However, this was after other attempts to address a cluster of building and financial issues had been attempted and had failed.
  6. [75]
    Considering the way that the project stalled for reasons that were at least largely outside Mr Luscombe’s control, and the termination of the contract before work could be completed, I consider it would be unfair to require Mr Luscombe to rectify.

Site drainage

  1. [76]
    Several directions to rectify relate to inadequate site drainage. QBCC submits that in certain areas under the house, rainwater will flow toward the foundations rather than away, as required under the Building Code of Australia. QBCC submits that the grading of the soil should have been done while Mr Luscombe could still access the undercroft with a small machine. Now, the work would have to be done by hand because the undercroft is enclosed.
  2. [77]
    Mr Luscombe’s evidence may be summarised as follows. The drainage problems arose because the levels shown on the approved plans were incorrect. From about the fourth day of construction, he told Mr Cockburn about the problem but Mr Cockburn insisted on construction proceeding without amendment of the plans to show drainage points etc., because of cost constraints. By about October 2015, Mr Luscombe was left with no choice but to request variations. These were never approved by the owner, who then terminated the contract. Nor would the owner provide instructions during the period allowed for rectification under the directions to rectify. The work should be treated as incomplete rather than defective.
  1. [78]
    Mr Bergin’s evidence may be summarised as follows. External landscaping work is yet to be done, and effective landscaping will minimise the intrusion of water. Once approved drawings are provided by the owner for landscaping, retaining walls and a lower subfloor nib wall, work can be completed. Meanwhile, the subfloor drainage is acceptable on an interim basis.
  2. [79]
    While I accept Mr Bergin’s evidence that the subfloor drainage does not present an urgent problem, there is no dispute that the drainage in its present state is unsatisfactory over the long term. Whether it is more aptly classified as defective or incomplete is not significant for present purposes. As to whether Mr Luscombe should be required to rectify, I accept that the problem arose through a fault in the initial design (for which the owner was responsible) and then a failure by the owner to obtain revised approved plans. On the other hand, it was far from ideal that Mr Luscombe succumbed to pressure from Mr Cockburn to continue with the work, given that drainage is a fundamental issue, the expected outcome is quite straightforward, and levelling work becomes more difficult once the undercroft is enclosed. Overall, though, I do consider that the problem is primarily attributable to the conduct of the owner. Therefore, on balance, I consider it would be unfair to require Mr Luscombe to rectify.

Wall linings

  1. [80]
    Three directions to rectify relate to internal plasterboard wall linings deviating by more than the allowed tolerances: one in the garage and two in hallways. QBCC submits that the maximum allowed deviation under the relevant Australian Standard is 4 millimetres within a 1.8 metre section of wall. QBCC says that in several places the deviation is greater: up to 12 millimetres.
  2. [81]
    In respect of the wall linings, there is no significant challenge to the deviances found by Mr Trohear. In respect of the linings in the garage, Mr Bergin in his report agrees that the level of finish is not acceptable and indicates that the builder should rectify. In respect of the hallway linings, the effect of Mr Bergin’s evidence is that the deviations are not likely to be obvious to a casual observer and are too minor to warrant directions to rectify. In one instance, Mr Bergin says that the area of concern appears to be a small section of skirting between door openings. In the other instance, Mr Bergin says that it is common to get some deflection around plasterboard corner moulds and door openings in general. Finally, the close proximity of doors means that an attempt to rectify could end up with a worse result, according to Mr Bergin.
  3. [82]
    Mr Luscombe’s explanation for the state of the garage wall lining is that it was installed too quickly, in pressured circumstances. Mr Luscombe says that after the initial directions to rectify were issued, he installed new skirting. At that time he used dyna bolts for fixing, but Mr Cockburn expressed concern about whether the use of such bolts would compromise the Kordon termite management system. Mr Luscombe argues that the method of rectification would depend on the specialist advice obtained in relation to completing the Kordon system. I accept this evidence.
  1. [83]
    I find that the garage wall lining is defective. However, rectification could not be done immediately, as it would depend on further advice about the termite management system to be obtained by the owner. When this would be obtained is unknown. Bearing in mind this uncertainty, and the relatively minor nature of the defect, I have decided on balance that the discretion to require rectification should not be exercised.
  2. [84]
    In relation to the hallway linings, I accept that the work does not comply with an applicable Australian Standard. Although the deviations would not be readily apparent to a casual observer, I am satisfied that the work is defective. However, I also accept Mr Bergin’s opinion that rectification is not warranted because such deviation is difficult to avoid in such situations and attempted remediation might produce a worse result. It is therefore not appropriate to exercise the discretion to require rectification.

Finish around cellar door

  1. [85]
    Direction to rectify number 65 relates to an uneven finish around the cellar door. Mr Luscombe says that this problem has been rectified by replastering and painting. He has provided photographs that he says were taken during rectification. I see no reason to doubt this evidence. QBCC in its written submissions says that whether a defect was repaired after the direction to rectify was issued ‘ought not to be a relevant consideration’.[16] Ms Hedger for QBCC did not agree with my suggestion that this seemed inconsistent with QBCC’s concession at the start of the hearing that several directions to rectify should be set aside on the basis of subsequent rectification. She added that a subsequent inspection did not find that that there had been rectification. I have been unable to locate evidence in the exhibits that would support that submission. Having accepted Mr Luscombe’s evidence of rectification, I consider that the correct and preferable decision on review is to set aside the direction as it is no longer needed.

Other items which Mr Luscombe says were rectified

  1. [86]
    Directions to rectify 21 (a damaged door trim), 34 (a faulty gate latch), 44 (the frame of the sub floor entry door), 49 (guides at the bottom of the powder room door) and 50 (joint between floor and toilet in the powder room) are in a similar category to direction to rectify 65 discussed above, in that Mr Luscombe says the problems have been rectified while QBCC submits that subsequent rectification is irrelevant and/or not achieved. For the same reasons, in my view the correct and preferable decision is to set aside those directions.

Front door

  1. [87]
    This door is described as the fire rated door in the entry foyer in Mr Trohear’s report. Direction to rectify 42 is to the effect that the door does not have a margin of uniformity and consistency in that when closed it projects eight to nine millimetres at the latch side resulting in a visual defect.
  2. [88]
    In his first statement, Mr Luscombe says that he contacted the supplier, Australian Doors, who advised that warping would have occurred because the door was not painted within 12 months after installation. Mr Luscombe attached an email chain which he says verifies this, but I have not been able to locate verification in that email chain itself (which appears to be with Finlaysons), though Mr Luscombe is probably referring to the attached Australian Standard which discusses timber shrinkage. Mr Luscombe adds that the work is incomplete and would have been addressed had the contract not been terminated. In his second statement, Mr Luscombe says the door was ‘right’ when installed. He attributes warping to failure by the owner to paint the door within a reasonable time after it was installed. Mr Luscombe has also said that when the owner had the door painted, the painter painted only one side.
  1. [89]
    There is a divergence of views between the experts about whether the door is warped or there is some other explanation for the protrusion.
  2. [90]
    Mr Bergin’s report says that the door is ‘in wind’ (i.e. warped), not fit for purpose and that the builder should replace it. In his oral evidence, Mr Bergin accepted that warping will occur from painting only one side of a door. He commented, however, that he thinks the problem is more than likely a ‘product issue’ with the door. Mr Trohear, in his oral evidence, said there could be various causes of the protrusion.
  3. [91]
    There is no dispute that the state of the door is unsatisfactory, though the parties have different views on whether it should be classified as defective or incomplete. The available evidence does not clearly establish the cause of the problem. Mr Luscombe attributes the problem to a failure by the owner to promptly paint the door, or painting it on only one side, but it is not obvious to me why it would have been the owner’s responsibility, rather than Mr Luscombe’s, to paint it. Presumably it may relate to the timing of the installation of the door relative to the termination of the contract. In any event, though, the evidence of the experts Mr Bergin and Mr Trohear does not confirm a painting issue as the likely cause.
  4. [92]
    I accept Mr Luscombe’s evidence that the door was satisfactory when installed. However, of course, such a problem may emerge only with the passage of time. On the available evidence, I prefer Mr Bergin’s opinion that the likelihood is that there was some ‘product issue’ with the door. On that basis, I find that the work is defective. It was Mr Luscombe’s responsibility to supply a suitable door. For some reason, the door he received from the supplier turned out not to be suitable. I see no unfairness in requiring him to rectify this defect.

Internal stairs

  1. [93]
    Direction to rectify 51 relates to a timber internal staircase. The stairs have an unusual design in that the lower section is exposed within a room of the house, while the underside of the upper section is in an undercroft.
  2. [94]
    Direction 51 is to the effect that the treads in the upper section do not meet a reasonable standard of construction because there are gaps ranging from one to five millimetres between the rear of the treads and the vertical riser boards.
  3. [95]
    Mr Bergin in his report confirms that there are gaps. He remarks that it is not uncommon for some shrinkage to occur in timber products, and such gaps can usually be corrected by tightening wedges. He concludes: ‘Builder to rectify gap’.[17]
  4. [96]
    The following is a summary of Mr Trohear’s evidence. It is common for timber to shrink, but he would expect a more consistent pattern of shrinkage if that was the main cause of the gaps. Mr Trohear accepts that correction of such gaps could be done in the ordinary course of reaching practical completion.
  1. [97]
    The following is a summary of Mr Luscombe’s evidence. He notes the comments of a representative of the supplier to the effect that the shrinkage is within acceptable tolerances, and that the cause of shrinkage is that half of the stairs are exposed to elements underneath while the other half are purely internal. Mr Luscombe says that the lack of vents under the house, due to the incomplete state of the work, would be contributing to the timber not drying out. QBCC’s Standards and Tolerances Guide allows for deviation up to five millimetres. After the initial direction to rectify was issued, he sought instructions from the owner about how she wanted the stairs fixed, but she declined to provide them.
  2. [98]
    Mr Trohear has considerable experience in carpentry, and so I am inclined to accept his opinion that the problem cannot be attributed solely to shrinkage. Further, I do not see why this is a matter in which the owner can reasonably be expected to provide instructions: the relevant expertise would lie more with the builder than the owner. Also, while I accept that there are some relevant tolerances, and that the problem is at most a minor visual problem rather than a structural one, I do consider that the variability in the gaps means that the upper section of the stairs is defective or incomplete.
  3. [99]
    However, I am of the view that this was a minor matter that would have been attended to in the ordinary course of completing the project. In the present circumstances, where the opportunity to complete the project in the usual way was not open to Mr Luscombe, I consider on balance that it would be unfair to require him to rectify.

Waterproofing of bathroom floors

  1. [100]
    Three directions to rectify relate to non-compliance with the Building Code of Australia in that there are areas of bathroom floor within 1.5 m of shower heads that have not been waterproofed. QBCC says that the problem could be rectified either by extending the area of waterproofing, or installing ‘enclosed’ screens to replace the ‘frameless’ screens.
  2. [101]
    Mr Luscombe’s evidence may be summarised as follows. He accepts that waterproofing does not extend for 1.5 m in two of the three bathrooms. He had quoted for custom-made enclosed shower screens but Mr Cockburn purchased cheaper off-the-shelf frameless screens when the family moved in early. Mr Luscombe pointed out the problem but Mr Cockburn insisted on installation, saying that the frameless screens were a temporary measure.
  3. [102]
    Mr Trohear said in his oral evidence that the shower screens did not appear to be temporary.
  4. [103]
    Mr De Lang’s evidence about the bathrooms was somewhat confusing, but ultimately he maintained that the entirety of the bathroom floors were waterproofed.
  5. [104]
    In his report, Mr Bergin says in respect of each bathroom that Mr Luscombe had said that the waterproofing covered the whole floor. This appears to be inconsistent with Mr Luscombe’s evidence to the Tribunal. While it is possible that Mr Luscombe has been inconsistent, it is also possible that Mr Bergin thought that a comment about one bathroom was intended to apply to all three, or possibly has relied on comments from Mr De Lang. As I regard Mr Luscombe as an honest witness, I am minded to accept that he has given a truthful account to the Tribunal about the shower waterproofing.
  • [105]
    I find that in rooms where waterproofing did not extend for 1.5 metres from the shower head, the work was defective. However, I consider that in the circumstances it would be unfair to require Mr Luscombe to rectify as the owner’s conduct caused the problem and Mr Luscombe did not have the opportunity to complete the project.

Garage floor

  1. [106]
    Direction to rectify 7 is to the effect that a stain in, and dusting of, the concrete floor surface in the garage produces an inadequate finish. QBCC says that that the stain was caused by the storage of materials, and that the dusting effect probably results from casting the slab in wet conditions.
  2. [107]
    Mr Bergin considers that some areas of the slab surface show more wear than others. Unlike Mr Trohear, however, Mr Bergin does not consider that there are signs of dusting. Mr Bergin does not consider that any remedial action by the builder is required, but he believes that the area could easily be upgraded by cleaning and preparing the slab and then applying an epoxy coating.
  3. [108]
    The following is a summary of Mr Luscombe’s evidence. The slab was poured in dry conditions and carefully cured. The stain results from Mr Cockburn storing timber in the garage. Mr Luscombe also mentioned some other damage, which I do not understand to be the subject of the direction to rectify.
  4. [109]
    Given Mr Bergin’s longer experience in the building industry, I am inclined to prefer his opinion that there is no dusting effect. I also accept Mr Luscombe’s evidence that the stain resulted from damage caused by the owner. Overall, then, I am not satisfied that there was any relevant defect or incompleteness in the work done by Mr Luscombe on the garage floor.

Conclusion

  1. [110]
    In line with the reasoning above, I will set aside the decision of QBCC to issue directions to rectify other than direction 42 which relates to the front door.
  2. [111]
    The difference between my decision and that of QBCC relates in part to the fact that some problems have since been rectified, and also in part to different conclusions about whether certain work was satisfactory or unsatisfactory. However, the bulk of the difference relates to divergent views on whether it would be unfair to Mr Luscombe to require rectification. I accept that reasonable minds will differ on such a question. The approach of QBCC as the industry regulator, emphasising the importance of strict adherence by the builder to standards and specifications, is readily understandable. However, in the peculiar circumstances of this case, where the builder was unable to finish the project, the owner held an unusually high level of control, and the owner refused to obtain a redesign, on balance I have concluded that such adherence should yield to competing considerations in order to avoid unfairness to the builder.

Footnotes

[1]Queensland Building and Construction Act 1991 (Qld) (‘QBCC Act’), s 72.

[2]Ibid s 72(5).

[3]The version provided by QBCC, in Exhibit 11, is as in force on 1 July 2010.

[4]QBCC Act s 3.

[5]Duke Building Pty Ltd v Queensland Building and Construction Commission & Ors [2015] QCAT 397, 4[9].

[6]Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 20.

[7][2018] QCAT 177, 11[47].

[8]Written submissions [13.4].

[9]At 9.1.

[10]Report dated 31 May 2017, in Exhibit 7, p 23.

[11]Ibid p 36.

[12]Ibid p 20.

[13][1987] 2 Qd.R. 446.

[14]Ibid 458.

[15]Middleton v Queensland Building and Construction Commission [2018] QCAT 177, 11[47].

[16]At 6.5(e).

[17]Report dated 31 May 2017, in Exhibit 7, p 44.

Close

Editorial Notes

  • Published Case Name:

    Luscombe v Queensland Building and Construction Commission

  • Shortened Case Name:

    Luscombe v Queensland Building and Construction Commission

  • MNC:

    [2019] QCAT 13

  • Court:

    QCAT

  • Judge(s):

    Member Kanowski

  • Date:

    23 Jan 2019

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

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