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Kernohan Construction Pty Ltd v Gillham[2019] QCAT 165

Kernohan Construction Pty Ltd v Gillham[2019] QCAT 165

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:

Kernohan Construction Pty Ltd v Gillham [2019] QCAT 165

PARTIES:

KERNOHAN CONSTRUCTION PTY LTD T/AS KERNOHAN CONSTRUCTION

(applicant)

v

AUSTIN GILLHAM

(respondent)

APPLICATION NO/S:

BDL116-15

MATTER TYPE:

Building matters

DELIVERED ON:

14 June 2019

HEARING DATE:

13 March 2017; 15 March 2017; 16 March 2017; 17 March 2017

HEARD AT:

Maroochydore

DECISION OF:

Member Deane

ORDERS:

  1. Austin Gillham is to pay Kernohan Construction Pty Ltd T/As Kernohan Construction $12,747.56.
  2. A copy of this decision is to be provided by the Registry to the Master Builders Queensland and of the funds held by the Master Builders Queensland the amount of $12,747.56 is to be paid to Kernohan Construction Pty Ltd T/As Kernohan Construction and the balance paid to Austin Gillham.
  3. Any Application for costs by a party is to be made by filing in the Tribunal two (2) copies and providing to the other party one (1) copy of any submissions and evidence in support of the Application for costs by 4:00pm on 22 July 2019.
  4. If any Application for costs is made:
  1. (a)
    the other party must file in the Tribunal two (2) copies and provide one (1) copy of any submissions and evidence in response to the party making the Application for costs by 4:00pm on 12 August 2019;
  2. (b)
    the party making the Application for costs must file in the Tribunal two (2) copies and provide one (1) copy of any submissions and evidence in reply to the other party by 4:00pm on 26 August 2019;
  3. (c)
    The Application for costs will be determined on the papers on the basis of any documents filed unless a party requests an oral hearing not before 4:00pm 26 August 2019.
  1. If no Application for costs is made in accordance with Order 3 then there shall be no order as to costs.

CATCHWORDS:

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – DEDUCTIONS – where owner claims defective work – whether owner entitled to deduct amounts from payment claims

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – PERFORMANCE OF WORK – GENERAL – Domestic Building Contracts Act 2000 (Qld) – where contractual variations – where variations did not comply with Part 7 of the Domestic Building Contracts Act 2000 (Qld) – where owner agreed to variation work - whether owner can claim reimbursement of amounts paid

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – PERFORMANCE OF WORK – GENERAL – where owner fails to attend final inspection – where works suspended – where rectification of defective and incomplete works to take at least 14 days – whether practical completion achieved

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMEDIES FOR BREACH OF CONTRACT – DAMAGES – where liquidated damages payable for delayed completion – whether actual damages are payable after obtaining possession.

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – where alternative claim made in final written submissions – where no explanation as to why application to amend is made at late stage – whether leave should be granted to amend claim

Domestic Building Contracts Act 2000 (Qld), s 8, s 9, s 18, s 44, s 45, s 79, s 80, s 82, s 92, sch 2

Queensland Building and Construction Commission and Other Legislation Amendment Act 2014 (Qld), s 62

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 3, s 28

Airstrike Industrial Pty Ltd v Robertson [2014] QCATA 209

Aon Risk Services Aust Pty Ltd v Australian National University (2009) 239 CLR 175

Bartlett v Contrast Constructions Pty Ltd [2016] QCA 119

Bellgrove v Eldridge (1954) 90 CLR 613

Fraser v The Irish Restaurant & Bar Company Pty Ltd [2008] QCA 270

Greer & Anor v Mt Cotton Constructions Pty Ltd [2018] QCATA 196

Ryan v Worthington Simmons [2014] QCATA 277

Salam v Henley Properties (Qld) Pty Ltd [2015] QCATA 118

Sumpter v Hedges [1898] 1 QB 673

Tabcorp Holdings Limited v Bowen Investments Pty Ltd (2009) 236 CLR 272

APPEARANCES & REPRESENTATION:

 

Applicant:

A C Harding, instructed by Garland Waddington, Solicitors

Respondent:

P B Tucker, instructed by Aitken Whyte Lawyers

AMENDED REASONS FOR DECISION

  1. [1]
    A number of the issues raised for determination in this matter relating to the operation of Part 7 of the Domestic Building Contracts Act 2000 (Qld) (DBC Act) were the subject of an appeal in another building dispute before the Tribunal, which was heard by the Appeal Tribunal on 22 August 2017 not long after final submissions in this proceeding were filed.  The Appeal Tribunal delivered its decision on 21 November 2018 in Greer & Anor v Mt Cotton Constructions Pty Ltd (‘Greer’). [1] I have now considered the evidence in this matter in light of the Appeal Tribunal’s findings.
  2. [2]
    On or about 16 March 2015, Kernohan Construction (the Builder) entered into a contract with Mr Gillham to undertake extensive renovations to Mr Gillham’s house (the ‘Contract’). The Contract price was $675,451.84 (incl GST).  The Builder’s Amended Application for domestic building disputes[2] claims payment of amounts invoiced in the amount of $78,588.32, interest on amounts outstanding[3] and costs.
  3. [3]
    Mr Gillham disputes any amount is owing to the Builder and counter applies for $218,184.96 plus interest and costs, including amounts for liquidated damages, actual damages for delay, damages in respect of defective and incomplete work and claims for loss or damage to Mr Gillham’s property. 
  4. [4]
    Although some submissions as to costs have been made by the parties I have provided directions to facilitate any application for costs to be made once the parties have read these reasons. Each party has had some success in claims made and defended.  Extensive written submissions were filed by the parties.[4]
  5. [5]
    The parties’ positions have evolved during the course of the contract and these proceedings.  There has also been an evolution of the evidence relied upon by the parties.  This reflects poorly upon the credibility of both Mr Kernohan, the Builder’s director and Mr Gillham.   
  6. [6]
    On 7 August 2015, after the Builder claimed to have achieved Practical Completion, it purported to suspend the Contract and to exclude Mr Gillham from the premises, claiming Mr Gillham had breached the Contract, including in respect of non-payment of its claims.
  7. [7]
    On or about 3 December 2015, Mr Gillham paid the amount claimed by the Builder into the Master Builders Queensland Holding Account as contemplated by the Contract.[5] On 4 December 2015 the Builder handed over keys to the property.  Mr Gillham contends that he accepted the Builder’s repudiation and terminated the Contract by responding to the claims made in these proceedings so that the Builder is no longer entitled to the benefit of being permitted to attend itself to the rectification of defective or incomplete building work.  The Builder contends that the lateness of Mr Gillham’s clear assertion of this position makes such a claim untenable.

Does the Domestic Building Contracts Act 2000 (Qld) (DBC Act) apply? 

  1. [8]
    I find that the DBC Act applies.
  2. [9]
    Although the DBC Act has been repealed, it continues to apply to domestic building contracts entered into before 1 July 2015.[6]  I accept that the work to be performed under the Contract is domestic building work[7] and that the Contract was for more than the regulated amount.[8]  The objects of the DBC Act are to achieve a reasonable balance between the interests of contractors and owners and to maintain appropriate standards in the industry.[9]
  3. [10]
    Mr Gillham contends that the Builder breached numerous provisions of the DBC Act, most of which provide for a monetary fine where there is a contravention.  These proceedings are not a prosecution under those provisions. 

Are the Builder’s payment claims payable?

  1. [11]
    I find that claim 4b was short paid by $8,949.60 (incl GST); claim 5 was short paid by $15,552.02 (incl GST) and claim 6 was short paid by $16,747.60.  Interest payable by Mr Gillham accrued to 14 June 2019 is $8,122.79, being $1781.20 in respect of claim 4b, $3,110.40 in respect of claim 5 and $3,231.19 in respect of claim 6.
  2. [12]
    The Builder seeks payment of outstanding payment claim 6 dated 20 July 2015 in the sum of $32,856.00  and the Practical Completion claim dated 24 July 2015 in the sum of $6,361.51. 
  3. [13]
    It also seeks amounts claimed to have been short paid by Mr Gillham, as follows:
    1. (a)
      balance payment claim 4b (invoice 3205b) $10,459.48
    2. (b)
      balance payment claim 5 (invoice 3214)  $28,911.33
  4. [14]
    The total outstanding claimed is $78,588.32 together with interest and costs. 
  5. [15]
    In his final submissions, Mr Gillham contends that the Builder is entitled only to $24,071.55 in respect of the works, being $78,588.32 less claims for variations being $54,516.77 and that he is entitled to set off amounts for damages and other compensation totalling $252,185.97 so that Mr Gillham should be awarded $218,184.96 plus interest and costs.
  6. [16]
    During the proceeding, Mr Gillham contended that the Practical Completion claim was for $78,588.29 and superseded payment claim 6 and for that matter payment claims 4b and 5.  He contends that the payment claim consisted of the invoice and the accompanying document.  During the hearing, Mr Kernohan’s evidence was that the accompanying worksheet was provided to assist Mr Gillham but did not form part of the payment claim.  Whilst the Builder could have made the purpose of the accompanying documentation clearer at the time the document was delivered, I find that the invoice should be construed as the payment claim or in any event take precedence over other documents provided at the same time.  The evidence is, and I accept, that the initial payment claims simply consisted of invoices.
  7. [17]
    Mr Gillham contends that the Builder’s payment claims were not validly made and payable including because:
    1. (a)
      they were emailed;
    2. (b)
      the work claimed for was not completed at the time of the claim;
    3. (c)
      they were not approved for payment under the modified process for payment claims as provided for under the special conditions.  

Use of Email

  1. [18]
    I find that the notices given by the Builder by email are valid. 
  2. [19]
    Mr Gillham points out that General Condition clause 24 of the Contract does not refer to notices being given by email.  General Condition Clause 24.2 provides:

Unless otherwise stated in this Contract, any written notice, or other document required to be given to the other party is deemed to have been given and received:

  1. (a)
    by hand to the person to whom it is required to be given and received;
  2. (b)
    by pre-paid post or registered post to the address of the person to whom it is required to be given, on the date of receipt or, in the case of registered post, two (2) clear Business Days after posting, whichever is earlier; or
  3. (c)
    by facsimile transmission to the facsimile number (if any) stated in the Schedule,  on confirmation of correct transmission of the facsimile.
  1. [20]
    The evidence before me demonstrates that most (if not all) written communications during the course of the Contract between the parties took place by email.  Mr Gillham does not contend that he objected to the Builder sending progress claims or other notices under the Contract by email during the course of the Contract and that despite an objection the Builder persisted.  Even if the Contract prohibited the giving of notices by email, which it does not, I would be inclined to find that Mr Gillham had waived any right to contend the notices were not valid because they were sent by email.
  2. [21]
    Payment claim 1 was emailed to Mr Gillham and to his Project Manager/Authorised Agent, Mr Hermon[10] on 28 March 2015.  Each payment claim in evidence before me was emailed.
  3. [22]
    General Condition Clause 24 does not limit the methods by which notices could be given.  In my view, the preferable construction is that it simply provides a deeming mechanism for when notices are taken to have been given if one of the methods contained in General Condition clause 24 is used.  If  a different method is used the party giving the notice does not have the benefit of a deemed received time and would, if necessary, be required to prove when the notice was actually given and received. 
  4. [23]
    Mr Gillham’s pleadings and evidence make it clear that the payment claims were received and sets out the relevant dates the payment claims were emailed to him.  
  5. [24]
    Mr Gillham paid in full the Builder’s payment claim 1 dated 27 March 2015 for $44,939.07 (incl GST),[11] payment claim 2 dated 20 April 2015 for $170,458.70 (incl GST)[12] and payment claim 3 dated on 13 May 2015 for $46,803.73 (incl GST).[13] 
  6. [25]
    Payment claim 2 included payment in respect of variation 1 in respect of removing and reinstating concrete in the sum of $10,773.84, variation 2 in respect of replacing lintel in the sum of $5,431.69, variation 3 in respect of steel column in the sum of $497.31 and variation 4 in respect of removing garden beds in the sum of $1,510.08.[14]

Payment claim 4b

  1. [26]
    The Builder issued payment claim 4b dated 21 May 2015 for $202,697.68 (incl GST),[15] which included a claim for variation 6 in respect of various carpentry in the sum of $546.70 (excl GST).[16]  The Builder included with the payment claim invoice an associated worksheet, which included details of the adjusted Contract sum taking into account variations, details of the total value of works claimed to have been completed to date and details of the total value of previous claims.
  2. [27]
    Mr Gillham deducted amounts from this claim, totalling $10,459.48 (incl GST).  By email dated 1 June 2015,[17] Mr Gillham advised that he had deducted $1,372.80 (excl GST) in respect of Variation 4, which he claimed was paid in error as the variation had not been approved or signed, $3,136 (excl GST) in respect of gutters and fascias and $5,000 (excl GST) in respect of the soffits issue and paid the sum of $192,238.20 on 2 June 2015. 
  3. [28]
    The Builder claims that Mr Gillham was not entitled to deduct these amounts and claims interest on the amount shortpaid.  The Contract provided for interest on amounts owing by Mr Gillham to the Builder at the rate of 5% per annum.[18] 

Work not completed at time claimed

  1. [29]
    Each claim needs to be assessed to determine if the work claimed had been completed save for minor defects or omissions.
  2. [30]
    Mr Gillham contends that the Builder was only entitled to claim for work which was completed.  I accept that in order to make a valid claim the work was required to have been completed save for minor defects or omissions.  Practical Completion Stage can be achieved even though there are minor defects or omissions.  I am satisfied that a similar qualification should be applied to earlier payment claims.

Claim not approved under modified payment provisions

  1. [31]
    Each claim needs to be assessed to determine if it ought to have been approved and paid under the modified payment provisions, which takes into account whether the work claimed had been completed save for minor defects or omissions.
  2. [32]
    Mr Gillham contends that under the modified payment provisions the amounts were not assessed as payable and therefore are not payable.  It is clear that the amounts were not assessed as payable.  The issue is whether the amounts ought to have been assessed as payable.  A party is not entitled to rely upon its own breach to relieve itself of the consequences of its own actions.  I accept that if work is defective in more than a minor respect then that will validly impact on the value of the work performed and able to be claimed.
  3. [33]
    The Builder contends that the Contract provides no right of set off or retention and in respect of payment claims 5, 6 and the Practical Completion claim Mr Gillham was not entitled to exercise rights vested by the parties in the Project Manager to assess claims.
  4. [34]
    It is somewhat difficult to reconcile the various standard provisions, which were not expressly modified, with the special conditions.
  5. [35]
    On balance, I find that the preferable construction is that:
    1. (a)
      the Builder was to submit the claim to the Project Manager, who was to assess the value of the work completed, subject to minor defects and omissions, discuss with the Builder any difference between the assessment and the amount claimed to afford the Builder an opportunity to revise the amount claimed and approve the amount payable by Mr Gillham. 
    1. (b)
      if the Builder did not agree with the amount assessed and approved then the Builder and Mr Gillham were to discuss and if agreement was not reached as to the amount payable for the value of the work completed, subject to minor defects and omissions, then they were to resolve the difference by reference to the Contract provisions. 
    2. (c)
      the Contract dispute resolution provisions are limited to holding without prejudice discussions through the Master Builder’s Association and bringing proceedings in this Tribunal.
    3. (d)
      the Contract provided no right to hold any retention for defects or omissions.[19]
    4. (e)
      the Contract provided a right of set off for liquidated damages only against the practical completion claim. [20]
    5. (f)
      the Contract provided an option of paying disputed monies in respect of the practical completion claim into the Master Builders Queensland Holding account.
    6. (g)
      claims other than the practical completion claim were required to be assessed as to the value of work performed without retention for minor defects or omissions and without setoff for liquidated damages and the amount so assessed paid;
    7. (h)
      the practical completion claim was required to be assessed as to the value of work performed without retention for minor defects or omissions; set off was permitted only for liquidated damages and that amount paid to the Builder or where there was a dispute as to the amount payable, the disputed monies may be paid into the Master Builders Queensland Holding account pending determination as to rights and entitlements by the Tribunal.     
  1. [35]
    The Contract modified the usual payment process as set out below.
  1. [36]
    Appendix Part D Method B provided for progress payments as ‘Monthly Claim on works Completed including Practical Completion’ rather than at defined stages. 
  1. [37]
    Special conditions further modified the standard payment claim process.  In accordance with the order of precedence clause, special conditions take precedence over general conditions, the Specification and the plans.[21]
  2. [38]
    Special condition 4  provided that Mr Hermon was employed to act as Project Manager on Mr Gillham’s behalf and that the Project Manager was to

review all progress payments including the Final Completion claim before authorising them for payment by the Owner.  In the event of any dispute, the progress payments may be submitted directly to the Owner and settled in accordance with the Contract terms although the Owner will take account of the Project Manager’s advice in so doing. 

  1. [39]
    The Contract provided that disputes may by agreement between the parties be referred to the Master Builders Queensland for a without prejudice conference and if the conference is unsuccessful referred to the Tribunal.[22]   The Builder commenced these proceedings initially just in relation to Mr Gillham withholding $5,000 in respect of the soffits issue.[23]
  2. [40]
    Special condition 6 provided that:

requests for monthly progress payments will be submitted simultaneously to the Owner’s representative and the Owner for review and approval by the former, prior to payment by the latter.

  1. [41]
    The Contract also provided:

any act or omission by the Owner’s Agent is deemed to be an act or omission of the Owner....any direction or instruction by the Owner’s Agent is deemed to be a direction or instruction given by the Owner.[24]

  1. [42]
    I am not satisfied that the modified payment provisions clearly modified the limited rights of retention set out in the General Conditions.  Construing the terms of the Contract as a whole I find that while clause 11.8 providing the limited rights of retention refers to payments due under clause 11.7 that should be construed as payments due under clause 11.7 as modified by the Special conditions.  The Special conditions did not specifically provide for a broader right of retention or set off nor clearly modify that contained in clause 11.8.    

Was Mr Gillham entitled to deduct $1,372.80 (excl GST) in respect of Variation 4?

  1. [43]
    For the reasons set out below in respect of Variation 4, I find that the Builder, having agreed to revise the amount claimed for this work after the deduction was made, cannot maintain that the deduction was wrongful.

Was Mr Gillham entitled to deduct $3,136 (excl GST) in respect of the Fascia and Gutters claim?

  1. [44]
    I find that Mr Gillham was not entitled to deduct $3,136 (excl GST) and that the Builder is entitled to interest on the amount unpaid.
  2. [45]
    Mr Gillham raised a number of issues with the claim for fascia and gutters. The sum claimed by the Builder represented a claim of 80% of the estimated total amount for that line item.  The evidence is that no amount for the fascia and gutter work had been approved to that date.  I am not satisfied on the evidence before me that the fascia and gutter work was such that the progress to that date had no value and that there was more than 20% of the value of the estimated value of the work still to have been performed.  Mr Gillham was obliged to value the work performed and pay for it without retention for minor defects or omissions.  
  3. [46]
    I find that the Builder is entitled to claim interest on the amount of $3449.60 (incl GST).
  4. [47]
    The evidence is that claim 4b was sent by email on Saturday 30 May 2015.[25]  The amount was due for payment within 10 business days.  On my calculation, payment was due by no later than 15 June 2015.[26] Interest accrues at the rate of 5% per annum or $0.47 per day on and from 16 June 2015.  As at 14 June 2019 interest accrued for a period of 1460 days amounting to $686.20.

Was Mr Gillham entitled to deduct $5,000 in respect of the Soffits from payment claim 4b? Was Mr Gillham entitled to deduct a further $5,000 from payment claim 5 and a further $5,000 from payment claim 6 and the Practical Completion claim bringing the total to $15,000?

  1. [48]
    I find that Mr Gillham was not entitled to deduct the amount of $5,000 from payment claim 4b nor to continue to withhold that amount.   I find that the Builder is entitled to claim interest on the amount unpaid. 
  2. [49]
    A number of disputes arose in relation to the changes to the soffits. 
  3. [50]
    Mr Gillham initially sought a credit based on advice from Mr Hermon that there would have been a cost saving of $4,842 in materials and an easier installation.  Mr Hermon did not give evidence in this proceeding.[27]  The Builder did not agree to a credit.  It contended that there was no real difference in the costs for labour and provided a contemporaneous quote from a supplier showing a similarity of prices for materials. 
  4. [51]
    Mr Gillham withheld $5,000 (excl GST) in respect of payment claim 4b in respect of the soffits.  The Builder commenced this proceeding on 24 June 2015 limited to a claim that Mr Gillham was not entitled to a credit in relation to the soffits. 
  5. [52]
    Mr Gillham contends that the Builder was in breach of contract because it did not issue a variation for the changed work and no variation amount was agreed.  The Builder did not issue a variation because it maintained the change was cost neutral.  I accept that the instruction was a request by the owner for varied work and that no express agreement was reached as to the cost impact of the varied work before it was performed.  I also accept that if the Builder was seeking an additional amount for the varied work it would not have been payable when claimed as no signed variation was in place.  However the Builder did not claim any additional amount.
  6. [53]
    I accept Mr Kernohan’s evidence, in particular having regard to the written contemporaneous pricing from his supplier[28] and the careful work method he described during his oral evidence that there was no saving to the Builder either in materials or labour.  In these circumstances I prefer the almost contemporaneous evidence over the independent experts’ subsequent evidence.  I find that Mr Gillham is not entitled to a credit.  In valuing the work performed by the Builder, Mr Gillham was not entitled to deduct moneys from progress claim 4b and continue to withhold them in respect of this item. 
  7. [54]
    Subsequently, Mr Gillham became aware that 9mm FC sheets were available and demanded the soffits be constructed as originally specified and withheld $5,000 on his assessment of payment claim 5 and a total of $15,000 on his combined assessment of claim 6 and the Practical Completion claim.
  8. [55]
    The tender and approved building drawings provided for “9mm FC sheets flush fitting to soffits” with “joints to be set, no plastic joins”.[29]
  9. [56]
    There is a conflict of evidence as to the precise words Mr Kernohan used in his discussions with Mr Gillham. 
  10. [57]
    I accept that Mr Gillham’s recollection is that Mr Kernohan told him that 9mm FC sheets were no longer available and offered the options of 9mm Villaboard or 6mm FC sheeting. His evidence is that the method of joining was not discussed at this time. 
  11. [58]
    Mr Kernohan’s evidence is that he raised a concern with Mr Gillham as to the suitability of 9 mm Villaboard and offered Hardiflex sheeting.  His evidence was that he said 9mm was not available in Hardiflex and that the thickest was 6 mm. 
  12. [59]
    The experts agreed with the Builder that the method of fixing proposed by the Contract was consistent with 9mm Villaboard being required.  I accept Mr Kernohan’s evidence that the Builder priced the work on Villaboard being supplied and installed.
  13. [60]
    After this discussion Mr Gillham spoke to his acoustic engineer and Mr Hermon, neither of whom gave evidence in this proceeding as to their discussions with Mr Gillham.
  14. [61]
    Mr Gillham’s evidence is that:
    1. (a)
      of the two choices he was told by his advisors that 6 mm FC would be better but would result in lower acoustic qualities than that specified. 
    2. (b)
      he did not understand the significance of the joining method, leading to a misunderstanding.
    3. (c)
      the joining method had been specified by Mr Hermon. 
    4. (d)
      he would have insisted on 9mm FC sheets if he had not been told it was no longer available.
    5. (e)
      he was mislead by the Builder into agreeing to an acoustically inferior product so that he should able to resile from the instruction he gave verbally and that Mr Hermon gave in writing on Mr Gillham’s behalf on 6 May 2015. 
  1. [65]
    Mr Gillham submits that the Builder should have consulted directly with Mr Hermon about this technical issue.  The Contract did not make it obligatory for the Builder to consult with Mr Hermon prior to discussing an issue with Mr Gillham.  In any event, Mr Gillham could have requested the Builder discuss the issue with Mr Hermon prior to making a decision as to how to proceed.
  2. [66]
    Mr Kernohan presented at the hearing as someone who spoke in quite a casual manner and did not have an eye to detail in his communications.  This is evident in the concessions he made during his oral evidence as to the inaccuracies in his initial written statement.   Mr Gillham was not technically qualified or experienced in building matters.  It is not surprising that misunderstandings may have arisen.  I am not satisfied that Mr Kernohan sought to take advantage of Mr Gillham’s misunderstanding or indeed that he was aware of the misunderstanding prior to the soffit dispute arising.
  3. [67]
    Even if I accept that Mr Gillham’s version of what was said is accurate, about which I have considerable doubt, he then sought advice from his Project Manager, who had building expertise and advice from his acoustic engineer.  On the evidence before me, neither of those professionals sought to challenge the Builder’s apparent assertion, or Mr Gillham’s understanding of what was said by Mr Kernohan, that 9mm FC sheets were ‘no longer available’ or explore other options to seek to achieve the acoustic performance, which was of importance to Mr Gillham. 
  4. [68]
    I am not satisfied that any loss of acoustic performance Mr Gillham suffered as a consequence of his direction to use 6mm FC sheets is directly attributable to a failure on the Builder’s behalf including because:
    1. (a)
      the Builder did not hold itself out as an acoustic expert.  There is no evidence before me that it offered advice about acoustic amenity; 
    2. (b)
      there were intervening consultations and advice sought and given from other professionals upon whom Mr Gillham relied;
    3. (c)
      the Builder’s duty of care was to exercise reasonable care and skill in carrying out the building work in accordance with the plans and specification and the owner’s directions.   
  1. [69]
    Mr Hermon issued a written instruction to the Builder.  The Builder relied upon that written instruction and incurred costs in constructing the soffits using 6mm FC sheeting.
  2. [70]
    There is contemporaneous evidence as to the cost of 6mm Hardiflex and 9mm Villaboard, which substantiate the Builder’s contention that there was no material savings to the Builder.[30]
  3. [71]
    The Contract plans specified soffits as ‘9mm FC’.[31]  The plans were prepared on behalf of Mr Gillham.  In contrast to other matters there was no detail in the specification.  Mr Gillham subsequently instructed the Builder to use plastic joins following a visit by Mr Kernohan to Mr Gillham’s Doonan house.  On the evidence before me, Mr Gillham chose not to consult with Mr Hermon prior to directing this change.  There is no suggestion in the evidence before me that the Builder prevented Mr Gillham from consulting with his professional advisors.  The Builder carried out the work as directed.   
  4. [72]
    Subsequently, Mr Gillham did some research and discovered that, while Hardiflex may not be made in 9mm, an alternative supplier did make 9mm FC sheeting which could be used with plastic joins.  Upon this discovery, Mr Gillham demanded the Builder remove the work performed and replace it with 9mm FC sheeting.  Mr Gillham contends that the Builder had an obligation to advise different 9mm FC options once he had agreed to the different joining method.  I am not satisfied that such an obligation arose including for the first and third reasons set out earlier.   
  5. [73]
    By email dated 31 July 2015 Mr Gillham advised that he was deducting $15,000 in respect of the disputed soffits work from the amount payable to the Builder in respect of his combined assessment of progress claim 6 and the Practical Completion claim.[32]
  6. [74]
    I find that in the circumstances Mr Gillham was not entitled to resile from the instruction provided orally and in writing.

Interest

  1. [75]
    I find that the Builder is entitled to claim interest on the amount of $5,500 (incl GST).
  2. [76]
    Interest accrues at the rate of 5% per annum or $0.75 per day on and from 16 June 2015 on my calculation.  As at 14 June 2019 interest accrued for a period of 1460 days amounting to $1,095.
  3. [77]
    I find that the total interest payable on $8,949.60, being the short payment of claim 4b, is $1,781.20 as at 14 June 2019.

Payment claim 5

  1. [78]
    The Builder issued payment claim 5 dated 18 June 2015 for $162,884.55 (incl GST),[33] which included the following variations:
    1. (a)
      variation 5 in respect of render in the sum of $7,559.50;
    2. (b)
      variation 7 in respect of core holes in the sum of $294.80;
    3. (c)
      variation 9 in respect of stormwater repairs in the sum of $2,057.00;
    4. (d)
      variation 10 in respect of patio slab in the sum of $6,820.00;
    5. (e)
      variation 11 in respect of footpaths in the sum of $1,419.00;
    6. (f)
      variation 12 in respect of extra to patio slab in the sum of $660.00;
    7. (g)
      variation 14 in respect of ornate cornice in the sum of $495.00;
    8. (h)
      variation 15 in respect of raise post bases in the sum of $275.00;
    9. (i)
      variation 16 in respect of extra paving in the sum of $528.00;
    10. (j)
      variation 18 in respect of door head in the sum of $808.50;
    11. (k)
      variation 19 in respect of downpipes and gutter in the sum of $1,070.30;
    12. (l)
      variation 20 in respect of omitting painting in the sum of $30,000.00 to be deducted;
    13. (m)
      variation 21 in respect of omitting two coats of armourflex in the sum of $10,000.00 to be deducted.[34]
  1. [75]
    The evidence is that, by email dated 22 June 2015, Mr Hermon advised the Builder that he was no longer engaged by Mr Gillham upon receipt of payment claim 5 and in the absence of a Project Manager, the Builder commenced to deal directly with Mr Gillham in respect of payment claims.  It is not contended that the Builder raised an objection during the course of the Contract that Mr Gillham was in breach of the payment provisions by not appointing a replacement for Mr Hermon.  Mr Gillham’s failure to appoint an alternative Project Manager and the Builder’s acquiescence resulted in the somewhat unusual position that Mr Gillham assumed the role of the Project Manager in assessing the payment claims as to the value of work performed. There is evidence before me that at some point he engaged a quantity surveyor to assist him but this professional was not appointed Project Manager under the Contract nor did he assume that role.  The quantity surveyor did not provide evidence in these proceedings.  
  2. [76]
    Mr Gillham deducted amounts from this claim, totalling $28,911.33 ($26,283 excl GST) and paid the sum of $133,973.25 on 29 June 2015.
  3. [77]
    By email dated 29 June 2015, Mr Gillham advised that he had deducted various amounts from the value of work performed and acknowledged that the claim had been sent to him on 19 June 2015.  Mr Gillham had raised issues with the claim with the Builder by email dated 24 June 2015 but had not received a response.  As stated earlier, I am not satisfied that Mr Gillham had any right of retention for defective work entitling him to deduct amounts from this claim but there was a right to assess the value of work completed subject to minor defects and omissions.

Was Mr Gillham entitled to deduct $5,100 (excl GST) in respect of roof tiling from payment claim 5?

  1. [78]
    I find that Mr Gillham was not entitled to deduct $5,100 for roof tiling. 
  2. [79]
    The Builder had claimed that this work was 100% complete and claimed 25% in this claim.  The amount retained represented 10% of the estimated total value of the work.   
  3. [80]
    On the evidence before me the reasonable costs of rectification is $82.12 (incl GST) for the reasons set out later.   I find that the defects were minor, which did not give rise to a right to deduct any amount from the claim.

Was Mr Gillham entitled to deduct $784 (excl GST) in respect of metal fascia and gutters from payment claim 5?

  1. [81]
    I find Mr Gillham was entitled to deduct $784 for metal fascia and gutters. 
  2. [82]
    The Builder had claimed that this work was 100% complete and claimed 20% in this claim.  The amount retained represented 20% of the estimated total value of the work.

On the evidence before me the reasonable costs of rectification, which on balance relate to this line item, are $1,998.58 (incl GST)[35] and $187.21 (incl GST)[36] for the reasons set out later.  

Was Mr Gillham entitled to deduct a further $5,000(excl GST) in respect of the Soffits from payment claim 5?

  1. [83]
    I find Mr Gillham was not entitled to deduct a further $5,000 for substitution of 6mm FC for 9mm FC soffits as part of the suspended ceiling and plasterboard wall linings item. The Builder had claimed that this work was 100% complete and claimed 20% in this claim.  The amount claimed by the Builder in progress claim 5 did not seek to add the amount short paid on claim 4b.  For the reasons set out earlier I have found Mr Gillham was not entitled to make such a deduction.

Was Mr Gillham entitled to deduct $1,280 (excl GST) in respect of relaying pavers from payment claim 5?

  1. [84]
    I accept Mr Gillham’s evidence that the relaying pavers over new concrete paths work was not complete at the time of the claim and in the absence of other sufficient evidence accept he was entitled to deduct $1,280 on the basis all the work had not been completed by the date of the claim and some remained incomplete as at 24 June 2015.  The Builder had claimed that this work was 100% complete and claimed 100% in this claim.  The amount retained represented 50% of the estimated total value of the work.

Was Mr Gillham entitled to deduct $150 (excl GST) in respect of deliveries from payment claim 5?

  1. [85]
    I accept Mr Gillham’s evidence that works were ongoing at the time of the claim and in the absence of other sufficient evidence accept he was entitled to deduct $150 for deliveries on the basis that work was ongoing.  The Builder had claimed that this work was 100% complete and claimed 40% in this claim.  The amount retained represented 10% of the estimated total value of the work.

Was Mr Gillham entitled to deduct $50 (excl GST) in respect of telephone from payment claim 5?

  1. [86]
    I accept Mr Gillham’s evidence that works were ongoing at the time of the claim and in the absence of other sufficient evidence accept he was entitled to deduct $50 for telephone on the basis that work was ongoing.  The Builder had claimed that this work was 100% complete and claimed 40% in this claim.  The amount retained represented 10% of the estimated total value of the work.

Was Mr Gillham entitled to deduct $550 (excl GST) in respect of bin hire from payment claim 5?

  1. [87]
    I accept Mr Gillham’s evidence that works were ongoing at the time of the claim and in the absence of other sufficient evidence accept he was entitled to deduct $550 for bin hire on the basis the bin remained on site and dumping was ongoing.  The Builder had claimed that this work was 100% complete and claimed 10% in this claim.  The amount retained represented 10% of the estimated total value of the work.

Was Mr Gillham entitled to deduct $275 (excl GST) in respect of general hire from payment claim 5?

  1. [88]
    I accept Mr Gillham’s evidence that works were ongoing at the time of the claim and in the absence of other sufficient evidence accept he was entitled to deduct $275 for general hire on the basis that work was ongoing.  The Builder had claimed that this work was 100% complete and claimed 10% in this claim.  The amount retained represented 10% of the estimated total value of the work.

Was Mr Gillham entitled to deduct $88 (excl GST) in respect of renovate storm water and septic tanks from payment claim 5?

  1. [89]
    I accept Mr Gillham’s evidence that works were ongoing at the time of the claim and in the absence of other sufficient evidence accept he was entitled to deduct $88 for renovate storm water and septic tanks on the basis that work was ongoing.  The Builder had claimed that this work was 100% complete and claimed 40% in this claim.  The amount retained represented 10% of the estimated total value of the work.

Was Mr Gillham entitled to deduct $5,200 (excl GST) in respect of labour from payment claim 5?

  1. [90]
    I accept Mr Gillham’s evidence that works were ongoing at the time of the claim and in the absence of other sufficient evidence accept he was entitled to deduct $5,200 for labour on the basis work was continuing.  The Builder had claimed that this work was 100% complete and claimed 20% in this claim.  The amount retained represented 10% of the estimated total value of the work.

Was Mr Gillham entitled to deduct $1,500 (excl GST) in respect of internal and external solid rendering from payment claim 5?

  1. [91]
    I accept Mr Gillham’s evidence that works were ongoing at the time of the claim and in the absence of other sufficient evidence accept he was entitled to deduct $1,500 for internal and external solid rendering on the basis that work was ongoing.  The Builder had claimed that this work was 100% complete and claimed 70% in this claim.  The amount retained represented 5% of the estimated total value of the work.

Was Mr Gillham entitled to deduct $267 (excl GST) in respect of emptying, cleaning and refilling the rainwater tank from payment claim 5?

  1. [92]
    I find Mr Gillham was not entitled to deduct $267 as a 50% contribution for the cost of emptying, cleaning and refilling the rainwater tank because Mr Gillham had no general right of set off under the Contract even if he was entitled to make such a claim.

Was Mr Gillham entitled to deduct $495 (excl GST) in respect of variation 14 from payment claim 5?

  1. [93]
    I find Mr Gillham was entitled to deduct $495 in respect of variation 14 for the reasons set out later in respect of the Builder’s variation claim.

Was Mr Gillham entitled to deduct $809(excl GST) in respect of variation 18 from payment claim 5?

  1. [94]
    I find that Mr Gillham was entitled to deduct $809 in respect of variation 18 for the reasons set out later in respect of the Builder’s variation claim.

Was Mr Gillham entitled to deduct $535 (excl GST) in respect of variation 19 from payment claim 5?

  1. [95]
    I accept Mr Gillham’s evidence that works were not complete at the time of the claim and in the absence of other sufficient evidence accept he was entitled to deduct $535 in respect of variation 19 on the basis the work was not completed and for the reasons set out later including that some of the work formed part of the Contract and therefore was not properly claimable as a variation.  The amount retained represented 50% of the total value of the work.

Was Mr Gillham entitled to deduct $200 (excl GST) in respect of ancillary timber from payment claim 5?

  1. [96]
    I accept Mr Gillham’s evidence that works were not complete at the time of the claim and in the absence of other sufficient evidence accept he was entitled to deduct $200 in respect of ancillary timber.  The Builder had claimed that this work was 100% complete and claimed the balance 50% of this item.  The amount retained represented 10% of the estimated total value for this work.

Was Mr Gillham entitled to deduct $3,000 (excl GST) in respect of variation 20 and $1,000 (excl GST) in respect of variation 22 from payment claim 5?

  1. [97]
    For the reasons set out later I find Mr Gillham was not entitled to deduct $3000 in respect of variation 20 and $1000 in respect of variation 22 in relation to the claimed builder’s margin for the omitted work.

Interest

  1. [99]
    I find that the Builder is entitled to claim interest on the amount of $15,552.02 (incl GST) being $15,803.70 (incl GST) in respect of deductions Mr Gillham was not entitled to make less $251.68 (incl GST) in respect of the overstatement of the claim for variation 4 explained later in these reasons.
  1. [100]
    Mr Gillham’s evidence is that payment claim 5 was received on Friday 19 June 2015.[37]  It was payable within 10 business days.  On my calculation payment was due by no later than 3 July 2015. Interest accrues at the rate of 5% per annum or $2.13 per day on and from 4 July 2015.  As at 14 June 2019 interest accrued for a period of 1460 days amounting to $3,110.40.

Payment claim 6 and Practical Completion claim

  1. [101]
    Mr Gillham contended that the Builder issued payment claim 6 dated 20 July 2015 for $72,226.78 and the practical completion claim dated 24 July 2015 for $78,588.29, which superseded payment claim 6.  The Builder contends that the claims were for $32,856 and $6,361.51 respectively.
  2. [102]
    Mr Gillham did not pay any amount in respect of claim 6 or the practical completion claim. 
  3. [103]
    Mr Gillham contends that as the Contract provided for monthly progress claims the Builder was not entitled to make the practical completion claim in July but also, somewhat inconsistently, contends that the practical completion claim replaced claim 6. 
  4. [104]
    The evidence before me in respect of payment claim 6 is:
    1. (a)
      invoice no 3219 was issued by the Builder dated 20 July 2015 in the sum of $32,856.00 (incl GST), including a claim for variation 21 in respect of condenser slab in the sum of $467.50 (incl GST); and
    2. (b)
      an itemised list of work to date accompanied the invoice, which references the armourflex omission as variation 22, sets out the total value of the works claimed to be completed to date and deducts the value of previous claims by adjusting claims 4 and 5 to the amounts paid by Mr Gillham and states the total of this claim is $72,226.78 (GST inclusive).
  5. [105]
    Mr Kernohan’s evidence was that the itemised list was to act as a running tally to assist Mr Gillham in view of Mr Gillham having deducted amounts from the previous claims. 
  6. [106]
    On balance I find that the tax invoice delivered by the Builder constituted the payment claim which was to be made monthly and that the itemised list was a supporting document.
  7. [107]
    The time for payment of progress claim 6 was within 10 Business Days of receiving the progress claim.[38]  The evidence is that Mr Gillham received progress claim 6 by email on Monday 20 July 2015.[39]  Mr Gillham had no right of retention for defective work from this claim. As set out earlier these obligations were not clearly altered by the Special Conditions.
  8. [108]
    The evidence before me in respect of the practical completion payment claim is:
    1. (a)
      invoice no 3222 was issued by the Builder dated 24 July 2015 by email on Friday 24 July 2015[40] in the sum of $6,361.51 (incl GST), including a claim for variation 29 in respect of sandcoat to hardcote in the sum of $1,140.30 (incl GST);
    2. (b)
      an itemised list of work to date accompanied the invoice, which sets out the total value of the works claimed to be completed to date and deducts the value of previous claims paid by Mr Gillham and states the total of this claim is $78,588.29(GST inclusive).
  9. [109]
    I find that the practical completion payment claim was not validly made when claimed as Practical Completion had not been achieved by 24 July 2015 so that the claim was premature.  I am not satisfied that the works were complete but for minor defects and omissions.  For the reasons set out later, not all defects and omissions were minor. 
  10. [110]
    It is therefore not necessary to decide whether more than one claim could be made in the month of July.
  11. [111]
    Mr Gillham contends that the practical completion claim superseded claim 6 because there is no amount inserted in the accompanying itemised list for claim 6.  I do not accept this submission.
  12. [112]
    Below the reference to claim no 6 is a line and below that it clearly states ‘Total of payments of previous claims’.  In this respect the accompanying document with the practical completion claim is different to the accompanying document provided with earlier claims. Mr Gillham did not pay anything towards claim 6 by the time the practical completion claim was made or at all.  It is entirely appropriate for it to be left blank and for the practical completion claim, if it were otherwise valid, to subsist along with claim 6. 
  13. [113]
    Mr Gillham contends that payment claims are only payable once he assesses the amount owing and that as he assessed no amount was owing he was not obliged to pay any amount.  As set out earlier, the real question is whether Mr Gillham having properly assessed the value of the work save for minor defects and omissions ought to have assessed and paid an amount.
  14. [114]
    Mr Gillham wrote to the Builder by email dated 31 July 2015 expressing his view that no amount was payable to the Builder.  In his view the Builder owed him at least $19,648.48, once deductions were made for incomplete and disputed works and liquidated damages in the sum of $17,600 were applied.[41]
  15. [115]
    On the face of the email in evidence before me, Mr Gillham did not separately assess payment claim 6 as he was required to do.  It is not appropriate for him to rely upon his own wrong to contend no amount was payable.   Mr Gillham contended that there was $69,546.84 of incomplete works as at the date the Builder claimed practical completion but does not articulate which works are said to be incomplete and whether he contended the works the subject of claim 6 were incomplete. 
  16. [116]
    In the absence of clarity as to Mr Gillham’s contentions I have considered whether there is sufficient evidence before me to determine whether he was entitled to deduct from the amount payable the whole of each of the line item claims made by payment claim 6.
  17. [117]
    Mr Gillham’s final written submissions contend that the claim was invalid because it was made in respect of work that had not been completed.[42]  The submissions contend that claims were made in respect of the following work which had not been undertaken:
    1. (a)
      the construction of garden swales;
    2. (b)
      relocation of the stand alone air-conditioning unit;
    3. (c)
      relocation of the Gazebo; and
    4. (d)
      supply and installation of the Fondis unit and wine racks.
  1. [118]
    The submissions do not identify to which line items claimed by claim 6 each of these incomplete work items are said to relate.
  2. [119]
    I am not satisfied that Mr Gillham can contend that the claim was invalid in its entirety in circumstances where, in breach of the payment provisions he did not separately assess the value of the work completed, subject to minor defects and omissions, discuss with the Builder any difference between the assessment and the amount claimed and afford the Builder an opportunity to revise the amount claimed as contemplated by the Contract.

Was Mr Gillham entitled to deduct $2,849 (incl GST) in respect of the final 10% for Sanitary and Stormwater installation from payment claim 6?

  1. [119]
    Having regard to the evidence as to incomplete work, I am satisfied that Mr Gillham was entitled to deduct $1,524.60 (incl GST) from payment claim 6 in respect of the incomplete garden swale, which relates to stormwater dispersal, for the reasons set out later.[43]  Otherwise, I am not satisfied that Mr Gillham was entitled to deduct amounts because items of defective or incomplete work either do not appear to relate to this line item or are minor.  

Was Mr Gillham entitled to deduct $2,530 (incl GST) in respect of the final 10% for electrical installation from payment claim 6?

  1. [120]
    Having regard to the evidence as to incomplete work, I am satisfied that Mr Gillham was entitled to deduct the amount of $457.97(incl GST) in respect of incomplete work associated with the failure to relocate the existing stand alone air-conditioning for the reasons set out later.[44]  Otherwise, I am not satisfied that Mr Gillham was entitled to deduct amounts because items of defective or incomplete work either do not appear to relate to this line item or are minor.  

Was Mr Gillham entitled to deduct $7,500 (incl GST) in respect of the final 50% for the Airconditioning provisional sum from payment claim 6?

  1. [121]
    Having regard to the evidence as to defective and incomplete work, I am not satisfied that Mr Gillham was entitled to deduct $7,500 from payment claim 6 because items of defective or incomplete work either do not appear to relate to this line item or are minor.  

Was Mr Gillham entitled to deduct $2,123 (incl GST) in respect of the claim for 11.79% of the tile labour provisional sum such that it was claimed to be 51.79% complete from payment claim 6?

  1. [122]
    Having regard to the evidence as to defective and incomplete work, on balance, I am satisfied that Mr Gillham was entitled to deduct $2,123 from payment claim 6 because a number of items of defective or incomplete work appear to relate to this line item.     

Was Mr Gillham entitled to deduct $1,042.80 (incl GST) in respect of the final 20% for termite protection from payment claim 6?

  1. [123]
    Having regard to the evidence as to defective and incomplete work, I am not satisfied that Mr Gillham was entitled to deduct $1,042.80 from payment claim 6 because items of defective or incomplete work either do not appear to relate to this line item or are minor. 

Was Mr Gillham entitled to deduct $935 (incl GST) in respect of 100% claim for silicon seal from payment claim 6?

  1. [124]
    Having regard to the evidence as to defective and incomplete work, I am not satisfied that Mr Gillham was entitled to deduct $935 from payment claim 6 because items of defective or incomplete work either do not appear to relate to this line item or are minor. 

Was Mr Gillham entitled to deduct $1,821.60 (incl GST) in respect of 80% of professional clean from payment claim 6?

  1. [125]
    I find that Mr Gillham was entitled to deduct an amount of $562.88 (incl GST) from payment claim 6 but not entitled to deduct the entire amount.  The amount of $1,258.72 (incl GST) was payable.
  2. [126]
    Having regard to the evidence and my findings later in these reasons in respect of Scott schedule 34 and the balance 20% of this line item unclaimed at the relevant time, I find that the claim for cleaning was overstated. Otherwise, items of defective or incomplete work either do not appear to relate to this line item or are minor.  

Was Mr Gillham entitled to deduct $5,229.29 (incl GST) in respect of the final 10% for builder’s margin from payment claim 6?

  1. [127]
    I find that Mr Gillham was not entitled to deduct the entire amount for this item, however I find an entitlement to a deduction in the amount of $2,614.64 (incl GST) from payment claim 6.
  2. [128]
    Having regard to the evidence of the state of completion of the works, the claim for the whole of the final 10% for builder’s margin was premature.  The Builder had claimed 40% of this line item in the previous claim.  The evidence is that some progress had been achieved in the intervening time.  In the absence of precise evidence on this point I find that a deduction in the order of half of the amount claimed could have been justified by Mr Gillham.  This is consistent with my findings set out later that the reasonable costs of rectifying defective or incomplete work for which Mr Gillham is entitled to be compensated is in the order of 5% – 6 % of the Contract price.   

Was Mr Gillham entitled to deduct $8,357.81 (incl GST) in respect of the final 10% for aluminium joinery from payment claim 6?

  1. [129]
    Having regard to the evidence as to defective and incomplete work and my findings later in these reasons,[45] on balance, I am satisfied that Mr Gillham was entitled to deduct $8,357.81 from payment claim 6.     

Was Mr Gillham entitled to deduct $467.50 (incl GST) in respect of variation 21 in respect of condenser slab from payment claim 6?

  1. [130]
    I find that Mr Gillham was entitled to deduct the amount of $467.50 in respect of variation 21 from payment claim 6.  The amount was not payable at the time claimed for the reasons set out later in respect of the Builder’s variation claims. 
  1. [119]
    In addition, Mr Gillham’s reasons for asserting no amount was payable included an amount of $15,000 deducted for disputed works in relation to the soffits, being an additional $5,000 to that previously deducted from claims 4b and 5.  For the reasons set out earlier, I find that Mr Gillham was not entitled to deduct any amount in respect of soffits from payment claim 6.
  2. [120]
    The claim for liquidated damages in the sum of $17,600 cannot be applied in reduction of claim 6.

Interest

  1. [120]
    I find that the Builder is entitled to claim interest on the amount of $16,747.60 (incl GST) in respect of deductions Mr Gillham was not entitled to make.
  1. [121]
    As set out above payment claim 6 was payable within 10 Business Days of 20 July July 2015.  On my calculation, payment claim 6 ought to have been assessed as to the value of works and payment made by no later than 3 August 2015. Interest accrues at the rate of 5% per annum or $2.29 per day on and from 4 August 2015.  As at 14 June 2019 interest accrued for a period of 1411 days amounting to $3,231.19.

Is the Builder entitled to payment for Variations claimed?  Where Mr Gillham has paid for Variations is he entitled to be reimbursed?

  1. [131]
    Mr Gillham contends that the Builder did not comply with the requirements of part 7 of the DBC Act and with General Condition clause 12 in respect of variations.  He submits that the Builder’s claim should be discounted by $60,626.04[46] because none of the variations complied with the DBC Act and the Contract and that to the extent that Mr Gillham has paid for variations such payments represent a mistake of law or fact as to the Builder’s entitlement to receive payment and seeks restitution of amounts paid.
  2. [132]
    Mr Gillham contends that the Builder was required to comply with the following sections of the DBC Act:
    1. (a)
      Section 79 - reducing variations to writing prior to commencing work unless the work was urgent.[47]  Failure to comply subjects a builder to a monetary penalty;
    2. (b)
      Section 80(1) – ensuring the variation document complied with formal requirements set out in section 80(2) including as further set out in section 81(2).  Requiring the variation document to describe the variation,[48] if sought by the Builder to state the reasons for the variation,[49] if the variation would result in delay state the reasonable estimate for the delay,[50] state the change to the Contract Price or how the Contract Price would be worked out,[51] and state when any increase or decrease in the Contract Price was to be paid or accounted for.[52] Failure to comply subjects a builder to a monetary penalty;
    3. (c)
      Section 82 – taking all reasonable steps to have the owner sign the variation document.  Failure to comply subjects a builder to a monetary penalty;
    4. (d)
      Section 83 – providing a signed copy of the variation document to the owner within 5 business days.  Failure to comply subjects a builder to a monetary penalty.
  3. [133]
    Mr Gillham relies upon section 84 of the DBC Act to contend that the Builder was only entitled to recover amounts in respect of a variation:
    1. (a)
      sought by Mr Gillham if the Builder complied with sections 79, 80, 82 and 83 or with approval of the Tribunal upon application; or
    2. (b)
      sought by the Builder if it complied with sections 79, 80, 82 and 83 and the ground of unforeseen circumstances arose or with approval of the Tribunal upon application.
  4. [134]
    Further Mr Gillham contends in respect of any payment made by him in respect of any of the variations such payment represents a mistake of law (if not also a mistake of fact) as to the Builder’s entitlement to receive payment and that given the protective elements of the DBC Act they cannot be waived or disregarded.  He claims that the Builder should therefore make restitution in respect of any payment made for variations claimed by the Builder. 
  5. [135]
    The Appeal Tribunal in Greer’s case[53] found that:
    1. (a)
      the contractor ‘had no right to recover amounts for the unpaid non-compliant variations in the absence of the tribunal’s approval.’[54] 
    2. (b)
      ‘there is a distinction to be drawn between the right of a building contractor to recover an amount for a non-compliant variation and the amount payable under the contract as varied’.[55]  The latter is relevant to the assessment of the owner’s loss as ‘Part 7 of the DBC Act does not prohibit parties from freely entering into agreements for variation works that may not comply with the stated provisions.’[56]  Non-compliance does not make any variation agreements illegal nor the performance of the variation work illegal unlike the provisions in section 42 of the Queensland Building and Construction Commission Act 1991 (Qld).  The DBC Act contemplates that non-compliant variations may found an entitlement to extend time.[57]
    3. (c)
      a contractor who received payment for non-compliant variation work is not required to disgorge the amount to the owner by operation of s 84(2) of the DBC Act.[58]
  6. [136]
    The Appeal Tribunal in Greer’s case further observed:[59]

A party suing for damages for breach of a contract may only recover for the net loss sustained, that is, the value of the benefit of the contract fully performed less the contract price for securing such performance.

In Commonwealth v Amann Aviation Pty Ltd the High Court held that the corollary of the rule in Robinson v Harman is that a plaintiff is not entitled, by the award of damages upon breach, to be placed in a superior position to that which he or she would have been in had the contract been performed.

  1. [137]
    I consider each of the claims for variations in light of the Appeal Tribunal’s findings.

Variation 1(VA01) - $10,773.84 (incl GST)

  1. [138]
    I find that Mr Gillham is not entitled to be reimbursed an amount for this work.  
  2. [139]
    Mr Gillham contends that:
    1. (a)
      VA01 did not comply with General Conditions clause 12 and 14 and the DBC Act and therefore the Builder is not entitled to receive payment;
    2. (b)
      the works the subject of V01 were already part of the scope of works and he agreed to pay for VA01 in the mistaken belief that the work was not part of the original scope of works. 
  3. [140]
    The Builder emailed a variation document on 26 March 2015, which indicated the cost was $17,523.22 (incl GST).  In the covering email the Builder described the amount as a ‘provisional sum’ and indicated that the job would likely cost less.  Mr Gillham signed the variation document, somewhat reluctantly, as it was more than he had expected from his discussions with Mr Kernohan and returned it to the Builder by email on 27 March 2015.  Subsequently a revised variation document was emailed by the Builder on 17 April 2015 removing the allowance for paving.  Mr Gillham signed the revised variation document and returned it to the Builder by email on 19 April 2015 again indicating his agreement to vary the amount payable. 
  4. [141]
    The Builder claims that VA01 concerned a latent condition because it involved the discovery of a 400mm strip of concrete around the perimeter of the house, which was embedded under the road base, which was under the pavers. 
  5. [142]
    Latent Condition is defined to mean[60]

Any physical condition on or around the Land, including surface and subsurface conditions, which differ materially from the physical conditions reasonably expected by the Contractor at the time the Contract was entered into.

  1. [143]
    Mr Gillham contends that the Builder ought to have reasonably anticipated this work because, amongst other things, Mr Kernohan inspected the property on at least four occasions prior to entering into the Contract and Mr Kernohan stated that no variations were expected unless Mr Gillham sought additional works.  I do not accept that the Builder was somehow prevented from relying upon the terms of the written Contract as to when variations may arise, in particular as to latent conditions, by the making of this pre-contractual representation.  The Contract contained an entire agreement clause.[61]
  2. [144]
    Mr Gillham also contends that the original scope of work included the installation of the termite reticulation system and contemplated any attendant concrete cutting.
  3. [145]
    The experts accepted that varied work was required as a result of a latent condition.  I accept the experts’ evidence.
  4. [146]
    On the evidence before me I accept that the discovery of the concrete in the sub-soil was a latent condition within the meaning of the Contract.  I am not satisfied that the Builder could reasonably have expected to encounter such a condition even though he attended the property a number of times prior to signing the Contract as the evidence is that the concrete was below the ground surface.
  5. [147]
    I am not satisfied that the reference to ‘cuts or penetrations to any slab’ was intended to detail building work, which related to cutting of a strip of concrete, the existence of which was not reasonably apparent to the Builder prior to entering into the Contract.
  6. [148]
    Mr Gillham contends, and I accept, that the Builder did not strictly follow General Condition clause 14 as the variation document does not itself set out the estimate of the time required to rectify the condition.  Subsequently the Builder claimed an extension of time of three days in respect of additional work.[62]
  7. [149]
    The variation document does not describe the latent condition in as fulsome way as it might but was, in my view, sufficient to notify Mr Gillham of the issue encountered. 
  8. [150]
    I accept that a variation document was signed by Mr Gillham prior to the variation work commencing evidencing his agreement to vary the amount payable by him.  There is contemporaneous evidence before me that indicates that the work was undertaken in the period 30 March and 9 April 2015.[63]  The revised variation document omitted work, as it appears the parties, through discussion, agreed that the paving work initially included as part of the variation formed part of the original scope of work.      
  9. [151]
    Mr Gillham contends, and I accept, that the Builder did not strictly follow General Condition clause 12 as the variation document does not itself clearly set out when the variation amount was payable.[64] 
  10. [152]
    Mr Gillham paid the revised VA01 amount in full as part of payment claim 2, which payment claim was reviewed and approved by Mr Hermon, a building professional assisting Mr Gillham.
  11. [153]
    The evidence is that, at the time of entering into the Contract Mr Gillham was an experienced professional[65] and he sought and obtained relevant expertise from advisors to allow him the deal with builders including the Builder.  Mr Gillham prepared or caused to be prepared significant amendments to the proposed contract in the form of Special Conditions.  He conducted a tender process to select a builder and entered into significant negotiations with the Builder, once it had been identified as the preferred tenderer. Mr Gillham was clearly quite a sophisticated contracting party. There is no suggestion that Mr Gillham was not capable of familiarising himself with the terms of the Contract as to variations, which were essentially in the same terms as the provisions in the DBC Act.  He signed this and other variations presented to him to indicate his agreement to vary the amount payable under the Contract as varied.  I am not satisfied that the Builder should make restitution of amounts paid in these circumstances.
  12. [154]
    In any event, in accordance with the Appeal Tribunal’s decision in Greer’s case, in assessing Mr Gillham’s claim for damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.  

Variation 2 (VA02) - $5,431.69(incl GST), Variation 3 (VA03) - $497.31 (incl GST)

  1. [155]
    I find no amount is to be reimbursed to Mr Gillham in respect of these variations.
  2. [156]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation documents failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[66] 
  3. [157]
    I accept that the Builder did not strictly follow General Condition clause 12 and the DBC Act as the variation document does not itself clearly set out when the variation amount was payable.
  4. [158]
    Mr Gillham paid the amounts claimed for this work voluntarily as part of progress claim 2 following review and approval of the claim by Mr Hermon.  For the reasons set out in respect of VA01 no amount is repayable. 
  5. [159]
    In any event, for the reasons stated above, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.  

Variation 4 (VA04/04b) - $1,258.40(incl GST)

  1. [160]
    I find that in assessing Mr Gillham’s claim for damages $1,258.40 is to be taken into account in respect of this item.
  1. [2]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document was not signed by him prior to the Builder undertaking the work contrary to General Condition 12.3 and the DBC Act.[67]  Further, Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation documents failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[68]  I accept the document did not comply.
  1. [161]
    Mr Gillham paid the amount then claimed for this work ($1,510.08 incl GST) voluntarily as part of progress claim 2 following review and approval of the claim by Mr Hermon.  On or about 1 June 2015 Mr Gillham purported to deduct $1,372.80 (excl GST), being the original amount claimed, for this work from progress claim 4 despite Mr Hermon having previously approved the amount for payment. Mr Gillham contended that he had not approved or signed the variation and it had therefore been paid in error. 
  2. [162]
    Through subsequent discussion the Builder agreed to revise the amount claimed, issued a revised variation document on 5 June 2015 in the sum of $1,258.40 (incl GST), which Mr Gillham approved on 6 June 2015 ‘in a spirit of compromise’ indicating his agreement to vary the amount payable.[69]  In these circumstances, I am not satisfied that the Builder can maintain a claim that the deduction was wrongful.
  3. [163]
    Claims made by the Builder after 6 June 2015 do not appear to reconcile the agreed revised variation amount.  Variation 4 remains listed at the original amount and therefore the supporting worksheet accompanying claim 5 dated 18 June 2015, claim 6 dated 20 July 2015 and the Practical Completion claim dated 24 July 2015, overstate the total value of work performed by $251.68 (incl GST). 
  4. [164]
    On this basis I am not satisfied that Mr Gillham has received a claim for the revised agreed variation amount and therefore I am not satisfied that he has paid such an amount.
  5. [165]
    In any event, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.  

Variation 5 (VA05) - $8,315.45 (incl GST)

  1. [166]
    I find no amount is to be reimbursed to Mr Gillham.
  2. [167]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation documents failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[70]
  3. [168]
    This claim was in respect of rendering, which was a provisional sum item.[71] Mr Gillham signed and returned a variation document by email on 20 May 2015 indicating his agreement to vary the amount payable.[72]
  4. [169]
    General Condition clause 9.5 provides for an adjustment to the Contract price where the actual cost exceeds the allowance.  In those circumstances, the excess amount plus margin is added to the Contract Price and is to be claimed in the next progress claim.  In my view clause 9.5 applies in preference to clause 12 because it is a more specific provision.  I am not satisfied that there was a requirement to state when the amount was to be paid because clause 9.5 specifically provided when it was to be claimed and it was an adjustment to the Contract Price rather than a true variation. 
  5. [170]
    Mr Gillham paid the amounts claimed for this work voluntarily, as part of progress claim 5, following review and approval of the claim.  I am not satisfied that any amount is repayable. 
  6. [171]
    In any event, even if it were a variation as distinct from an adjustment, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.   

Variation 6 (VA06) - $601.37(incl GST) 

  1. [165]
    I find no amount is to be reimbursed to Mr Gillham.
  1. [166]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[73]
  2. [167]
    I accept the document did not comply.
  3. [168]
    Mr Gillham signed and returned the variation document by email on 20 May 2015 indicating his agreement to vary the amount payable and paid the amounts claimed for this work voluntarily as part of progress claim 4b following review and approval of the claim by Mr Hermon.  For the reasons set out in respect of VA01 no amount is repayable. 
  4. [169]
    In any event, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations. 

Variation 7 (VA07) - $324.28 (incl GST)

  1. [170]
    I find no amount is to be reimbursed to Mr Gillham.
  2. [171]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[74]
  3. [172]
    I accept the document did not comply.
  4. [173]
    Mr Gillham signed and returned the variation document by email on 2 June 2015 indicating his agreement to vary the amount payable.
  5. [174]
    The Builder claimed for this work in payment claim 5 dated 18 June 2015.  Mr Gillham in assessing the amount payable deducted amounts in respect of other work but not in respect of variation 7.  For the reasons set out in respect of VA01 no amount is repayable. 
  6. [175]
    In any event, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.  

Variation 9 (VA09) - $2,262.70 (incl GST) 

  1. [176]
    I find no amount is to be reimbursed to Mr Gillham.
  2. [177]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[75]
  3. [178]
    I accept the document did not comply.
  4. [179]
    Mr Gillham signed and returned the variation document by email on 2 June 2015 indicating his agreement to vary the amount payable.
  5. [180]
    The Builder claimed for this work in payment claim 5 dated 18 June 2015.  Mr Gillham in assessing the amount payable deducted amounts in respect of other work but not in respect of variation 9.  For the reasons set out in respect of VA01 no amount is repayable. 
  6. [181]
    In any event, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.  

Variation 10 (VA10) - $7,502 (incl GST)

  1. [182]
    I find no amount is to be reimbursed to Mr Gillham.  
  2. [183]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[76]
  3. [184]
    I accept the document did not comply.
  4. [185]
    Mr Gillham signed and returned the variation document by email on 3 June 2015 indicating his agreement to vary the amount payable.
  5. [186]
    The Builder claimed for this work in payment claim 5 dated 18 June 2015.  Mr Gillham in assessing the amount payable deducted amounts in respect of other work but not in respect of variation 10.  For the reasons set out in respect of VA01 no amount is repayable. 
  6. [187]
    In any event, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.  

Variation 11 (VA11) - $1,560.90 (incl GST)  

  1. [188]
    I find no amount is to be reimbursed to Mr Gillham.
  2. [189]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[77]  I accept that the document did not comply.
  3. [190]
    Mr Gillham signed and returned the variation document by email on 3 June 2015 indicating his agreement to vary the amount payable.
  4. [191]
    The Builder claimed for this work in payment claim 5 dated 18 June 2015.  Mr Gillham in assessing the amount payable deducted amounts in respect of other work but not in respect of variation 11.  For the reasons set out in respect of VA01 no amount is repayable. 
  5. [192]
    In any event, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.    

Variation 12 (VA12) - $726 (incl GST) 

  1. [193]
    I find no amount is to be reimbursed to Mr Gillham. 
  2. [194]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[78]  I accept the document did not comply.
  3. [195]
    Mr Gillham signed and returned the variation document by email on 6 June 2015 indicating his agreement to vary the amount payable.
  4. [196]
    The Builder claimed for this work in payment claim 5 dated 18 June 2015.  Mr Gillham in assessing the amount payable deducted amounts in respect of other work but not in respect of variation 12.  For the reasons set out in respect of VA01 no amount is repayable. 
  5. [197]
    In any event, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.  

Variation 14 (VA14) - $544.50 (incl GST) 

  1. [198]
    I find the amount claimed by the Builder was not payable under the Contract at the time claimed and the deduction validly made.
  2. [199]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation work was undertaken before the variation document was sent to him.  The variation document was sent on 5 June 2015 together with an extension of time (EOT) claim in respect of this work.  The EOT document indicates that this varied work caused delays on 3, 4 and 5 June 2015.  I accept that it is more likely than not that the work was performed prior to the variation document being sent to Mr Gillham.
  3. [200]
    Mr Gillham also contends that the Builder is not entitled to receive payment for this work as the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[79]  I accept that the document did not comply.
  4. [201]
    I also accept that upon receipt of the variation document, by email dated 6 June 2015, Mr Gillham disputed the amount claimed, requested information as to how the amount claimed had been determined by reference to the difference in cost between the specified plain plaster cornice and the varied work of installing the ornate cornice in the formal lounge. 
  5. [202]
    The Builder claimed for this work in payment claim 5 dated 18 June 2015.  Mr Gillham in assessing the amount payable deducted the amount claimed in respect of variation 14. 
  6. [203]
    The experts’ evidence was that the reasonable additional cost for the varied work was $66.42 (excl builder’s margin and GST). 
  7. [204]
    Having regard to the Appeal Tribunal’s reasoning in Greer I find that in assessing Mr Gillham’s damages the calculation is not to take into account any amount for this varied work.

Variation 15 (VA15) - $ 302.50 

  1. [205]
    I find no amount is payable to the Builder as the work was defective as described later in these reasons in respect of Scott schedule item 54.  The Builder is to reimburse Mr Gillham $302.50.
  2. [206]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[80]  I accept that it did not comply.
  3. [207]
    Mr Gillham signed and returned the variation document by email on 10 June 2015 indicating his agreement to vary the amount payable.
  4. [208]
    The Builder claimed for this work in payment claim 5 dated 18 June 2015.  Mr Gillham in assessing the amount payable deducted amounts in respect of other work but not in respect of variation 15. 
  5. [209]
    For the reasons set out later in respect of Scott Schedule item 54, the work was defective and required rectification work.

Variation 16 (VA16) - $ 580.80 (incl GST) 

  1. [210]
    I find no amount is to be reimbursed to Mr Gillham.
  2. [211]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[81]  I accept that it did not comply.
  3. [212]
    Mr Gillham signed and returned the variation document by email on 10 June 2015 indicating his agreement to vary the amount payable.
  4. [213]
    The Builder claimed for this work in payment claim 5 dated 18 June 2015.  Mr Gillham in assessing the amount payable deducted amounts in respect of other work but not in respect of variation 16.
  5. [214]
    In any event, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.  

Variation 18 (VA18) - $889.35 (incl GST)

  1. [215]
    I find the amount claimed by the Builder was not payable under the Contract at the time claimed and the deduction validly made as the work had not at that time been performed.   However, I find that in assessing Mr Gillham’s claim for damages $889.35 is to be taken into account in respect of this item.
  2. [216]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[82]  I accept that it did not comply.
  3. [217]
    Mr Gillham signed and returned the variation document by email on 16 June 2015 indicating his agreement to vary the amount payable.
  4. [218]
    The Builder claimed for this work in payment claim 5 dated 18 June 2015.  Mr Gillham in assessing the amount payable deducted the amount claimed in respect of variation 18. 
  5. [219]
    In any event, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.  

Variation 19 (VA 19) - $1,177.33 (incl GST)  

  1. [220]
    I find the total amount claimed by the Builder was not payable under the Contract at the time claimed and the deduction of half the amount claimed was validly made as the work had not at that time been completed.  I also find that the Builder had no entitlement to claim $495.86 (incl GST) as part of the variation because part of the works performed were part of the original scope of work. 
  2. [221]
    I find that in assessing Mr Gillham’s claim for damages $681.47 (incl GST)[83] is to be taken into account in respect of this item.
  3. [222]
    Mr Gillham claims the Builder is not entitled to receive payment for this work as part of the work was required under the terms of the Contract.  He also claims the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[84]  I accept that it did not comply.  Alternatively he claims it would be unconscientious for the Builder to retain any payment in respect of work required under the original scope of work and seeks restitution.
  4. [223]
    Mr Gillham signed and returned the variation document by email on 16 June 2015 indicating his agreement to vary the amount payable.
  5. [224]
    The Builder claimed for this work in payment claim 5 dated 18 June 2015.  Mr Gillham in assessing the amount payable deducted half of the claim being $535(excl GST) from the amount claimed in respect of variation 19 on the basis that all the work was not completed. 
  6. [225]
    I accept that part of the variation work claimed in respect of guttering on the workshop was work required under the Contract scope of work and was incorrectly claimed by the Builder as part of the variation.  The experts agreed and I accept that the reasonable costs of supplying and installing the works described in the Contract is $409.80 plus builder’s margin and GST, being $495.86 (incl GST).
  7. [226]
    In any event, in assessing Mr Gillham’s damages the calculation is to take into account $681.47 (incl GST) being the varied amount payable for non-compliant but nevertheless agreed variations less the amount which ought not have been charged.   

Variation 20 (VA 20) – delete painting   

  1. [227]
    I am not satisfied that Mr Gillham was entitled to any further deduction for builder’s margin. 
  2. [228]
    The Builder deducted $33,000 (incl GST) from payment claim 5 in respect of the omission of this provisional sum work.  Mr Gillham deducted a further $3,000 (excl GST) in respect of the builder’s margin.
  3. [229]
    Mr Gillham amended the variation document sent to him to deduct an additional amount in respect of builder’s margin and GST on the margin.  The amended document was sent by email to the Builder on 29 June 2015. 
  4. [230]
    I accept that there was no express agreement between Mr Gillham and the Builder as to the monetary basis on which the work was to be omitted.  Mr Gillham claims it would be unconscientious for the Builder to retain the builder’s margin, where the Builder requested the complete omission of the work.  I accept Mr Kernohan’s evidence that the reason the Builder requested this work be omitted is because he discovered that the subcontractor Mr Gillham required the Builder to use was unlicensed.  The Builder quite rightly did not want to be forced to contract with an unlicensed contractor.    I find it would not be unconscientious for the Builder to retain the builder’s margin where the owner was insisting on the use of an unlicensed contractor.
  5. [231]
    Mr Gillham accepts that if the actual cost of the provisional sum work was less than the allowance there would be no such adjustment of the builder’s margin in his favour.  He contends that the provision does not apply when the work has been completely omitted.
  6. [232]
    The experts gave evidence that it was industry practice to not make the adjustment Mr Gillham seeks.  The Tribunal regularly allows builders to retain the margin on omitted works.  It is clear from Mr Kernohan’s evidence that he had expended time and effort in liaising with Mr Gillham’s preferred contractor prior to discovering he was unlicensed.  The retention by the Builder of the builder’s margin in all the circumstances is not unreasonable.   

Variation 21 (VA21) - $ 467.50 (incl GST) 

  1. [233]
    I find that the Builder is not entitled to recover payment of this amount.  However, I find that in assessing Mr Gillham’s claim for damages $467.50 (incl GST) is to be taken into account in respect of this item. 
  2. [234]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[85]  I accept that it did not comply.
  3. [235]
    Mr Gillham signed and returned the variation document by email on 18 June 2015 indicating his agreement to vary the amount payable.
  4. [236]
    The Builder claimed for this work in payment claim 6 issued 20 July 2015.  Mr Gillham did not pay any amount in respect of payment claim 6 nor indeed did he separately assess whether any amount was payable.
  5. [237]
    In any event, in assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.  

Variation 22 (VA22) – delete armourflex 

  1. [238]
    I am not satisfied that Mr Gillham was entitled to any further deduction for builder’s margin. 
  2. [239]
    The Builder deducted $11,000 from payment claim 5 in respect of the omission of this work, then described as variation 21.
  3. [240]
    Mr Gillham amended the variation document sent to him to deduct an additional amount in respect of builder’s margin and GST on the margin.  The amended document was sent by email to the Builder on 29 June 2015.
  4. [241]
    I accept Mr Kernohan’s evidence that the reason the Builder requested this work be omitted is because, as referred to in respect of VA20, he discovered that the subcontractor Mr Gillham required the Builder to use was unlicensed.
  5. [242]
    For the reasons set out in respect of variation 20 I am not satisfied any further deduction should be made.

Variation 29 (VA29) - $1,140.30 (incl GST) 

  1. [243]
    I find the Builder is not entitled to recover payment of this amount.  I am not satisfied an amount for this work was payable when claimed as part of the practical completion payment claim.  In assessing Mr Gillham’s damages the calculation is to take into account $1,140.30 (incl GST) in respect of this item.
  2. [244]
    Mr Gillham contends that the Builder is not entitled to receive payment for this work as the variation document demonstrates that the work was undertaken before the variation document was signed contrary to General Condition clause 12.3 and it failed to state when the associated increase in the Contract Price was to be paid contrary to General Condition 12.4(e) and the DBC Act.[86]  I accept that it did not comply.
  3. [245]
    The Builder emailed the variation document to Mr Gillham on 24 July 2015 the same day it claimed practical completion had been reached.  Mr Gillham approved the variation by signing and returning the variation document by email on 31 July 2015 indicating his agreement to vary the amount payable.
  4. [246]
    In assessing Mr Gillham’s damages the calculation is to take into account the varied amount payable for non-compliant but nevertheless agreed variations.  

Is the Builder entitled to be paid for variations under section 84 of the DBC Act?

  1. [247]
    I refuse leave to amend the Builder’s claim to include a claim under section 84 of the DBC Act. 
  2. [248]
    In the Builder’s final written submissions,[87] it makes an alternative claim with respect to variations under section 84 of the DBC Act, which limits the right of builders to recover amounts for variations where the variations were not reduced to writing in accordance with the Contract and the DBC Act.  This is, in essence, an application for leave to amend its claim. 
  3. [249]
    The Appeal Tribunal has previously accepted that a builder is required to apply to the Tribunal for an order pursuant to section 84 of the DBC Act before the Tribunal may approve that such an amount is payable.[88]  In that case, the Appeal Tribunal accepted that entertaining a claim under section 84 of the DBC Act, although it had not been pleaded and the application to claim under section 84 of the DBC Act was made after the close of evidence, was a denial of natural justice as the home owners were not given an opportunity to adduce evidence or cross examine the builder’s witnesses about relevant matters. 
  4. [250]
    The Appeal Tribunal also found that in such circumstances the Tribunal ought to consider whether it would be appropriate to exercise its discretion to allow an amendment having regard to factors set out in Aon Risk Services Aust Pty Ltd v Australian National University (‘Aon’).[89] The Builder’s submissions do not address the factors in Aon.  In particular, there is no explanation of why the application to amend was made at such a very late stage.  I recall that during the hearing I enquired of Mr Harding whether an application under section 84 of the DBC Act was made and was advised that it was not.
  5. [251]
    Whilst the Tribunal’s objects require it to deal with matters in an informal manner,[90] it is also required to observe natural justice.[91] 
  6. [252]
    The parties were legally represented and documents very much akin to court pleadings were filed.  The Appeal Tribunal has observed that: [92]

where the parties’ legal advisers choose to conduct the case in more formal way, this cannot be ignored by the Tribunal.

  1. [253]
    I am not satisfied that such an amendment at such a very late stage ought to be entertained.   I accept that if I permitted the amendment that Mr Gillham would be denied the opportunity to adduce evidence or cross examine the Builder’s witnesses about relevant matters.

Was Practical Completion achieved on 24 July 2015?  Was Practical Completion deemed to have been achieved?  Did the Builder substantially complete the works?

  1. [254]
    I find that Practical Completion was not achieved by 24 July 2015.
  2. [255]
    The Builder claims that Practical Completion was actually achieved by 24 July 2015.
  3. [256]
    Mr Gillham contends that Practical Completion claim was invalid as:
    1. (a)
      practical completion is yet to be achieved;
    2. (b)
      the claim was emailed;
    3. (c)
      it did not attach documents required under General Condition clause 17.1(b)(iii);
    4. (d)
      it did not include a Form 21 Final Inspection Certificate .
  4. [257]
    The Contract provided:[93]

Practical Completion Stage - means that stage of Works when the Works are completed in accordance with the Contract and all relevant statutory requirements, apart from minor omissions or minor defects, and the Works are reasonably suitable for habitation. Where the Owner has engaged consultants including the Building Certifier, the Contractor is only required to provide support documents to the Owner to allow a final certificate to be issued.

  1. [258]
    The evidence is that the Form 21 Final inspection certificate was issued on 30 July 2015.  The issuing of such a certificate does not necessarily equate to Practical Completion being achieved under the terms of the Contract.  The evidence is, and I accept, that the certifier on or about 14 July 2015 required a number of matters to be attended to before issuing the certificate. 
  2. [259]
    Mr Gillham refers to his extensive list of works not constructed in accordance with the Contract, defects and incomplete work as evidencing that Practical Completion was not achieved by the Builder at the time claimed or at all.  He submits that whilst it is a question of fact and degree, if the sheer quantity of minor omissions or defects is such as to require a substantial number of trades and time to rectify the defective works and to complete the omitted works then practical completion will not have been achieved.  He also submits that the term ‘suitable for habitation’ is to be construed having regard to the nature and extent of the works and that as the works involved a ‘high end build’ and included elements in excess of general industry standards in relation to acoustics these matters should be taken into account in determining whether the premises were suitable for habitation.
  3. [260]
    Whether the house was suitable for habitation, and therefore practical completion achieved, is to be assessed at the time it was claimed or by the time the works were suspended given that no work was subsequently performed under the Contract.  The time for this assessment is not at a later time, including after Mr Gillham had cornice removed.
  4. [261]
    The Builder claims that the works were complete except for minor defects or omissions, which would have been attended to during the defects liability period. 
  5. [262]
    Alternatively, the Builder claims that Practical Completion is deemed to have been achieved as Mr Gillham failed to attend a final inspection following issue of the Practical Completion claim.
  6. [263]
    Mr Gillham contends that he was not required to attend the 28 July 2015 inspection because there was no valid call upon him to attend as the Practical Completion claim was invalid.   He contends that before 28 July 2015 he told the Builder he did not accept that the Works had reached Practical Completion and did not agree to attend. There is a conflict of evidence about this, which is not necessary to resolve.  Mr Kernohan, the Builder’s director, denies Mr Gillham communicated this prior to the meeting.  Mr Gillham’s evidence in relation to when and how this was communicated was imprecise and not supported by his usual contemporaneous emails.       
  7. [264]
    I accept Mr Gillham’s contention that if Practical Completion had not been achieved under the Contract, the notice calling for a final inspection was premature and his failure to attend ought not to have the consequence of deeming Practical Completion.
  8. [265]
    I accept the experts’ evidence that the rectification of defective and incomplete work would take in the order of at least 14 days assuming various trades attended concurrently where possible.  In these circumstances I am not satisfied that Practical Completion of the works was achieved where the original total construction period was 87 days, including 24 non-working days.
  9. [266]
    Further in the alternative, the Builder claims that the works were substantially performed and that this gives rise to an obligation on the part of Mr Gillham to pay the claims subject to a deduction for the costs of rectifying and completing the work.[94]
  1. [172]
    Having regard to my findings set out later in these reasons, that the reasonable costs of rectifying defective or incomplete work for which Mr Gillham is entitled to be compensated is in the order of 5% – 6 % of the Contract price and having regard to my findings that many of the items of defective and incomplete works are minor, I find that the works were substantially performed, such that the Builder is entitled to be paid the Contract price adjusted for the costs of rectification and adjusted for other amounts owing as between the parties.    
  2. [173]
    On my calculation, in the order of 31 items, to which I have found Mr Gillham is entitled to damages are for amounts less than $500[95] and in the order of a further 12 items are for amounts between $500 and less than $1,000. 

Were the Extensions of Time claimed valid? 

  1. [267]
    I find that the Date for Practical Completion Stage was validly extended by the Builder’s extension of time claims by 8 days to 18 June 2015 for the reasons set out below.
  2. [268]
    The Contract provided that Practical Completion was to be achieved by 10 June 2015 subject to any valid extensions of time.  The Builder claims that Practical Completion was achieved on 24 July 2015 and that extensions of time extended the time for completion to 25 July 2015.  Mr Gillham concedes that he agreed to requests for extensions of time dated 8 April 2015 (2 days), 22 April 2015 (3 days) and 11 May 2015 (2 days) such that the date for Practical Completion was extended to 17 June 2015 but seeks to resile from that agreement. 
  3. [269]
    Mr Gillham contends that the extension of time claims were not valid including because they were emailed.  For the reasons set out earlier, I am not satisfied that notices given by email are invalid.  Mr Gillham’s pleadings and evidence make it clear that the extension of time claims were received.  
  4. [270]
    Mr Gillham also contends that the extension of time claims were not valid as: the Builder did not provide reasonable advance notice of when owner supplied items were required, in breach of Special Condition 11; they were not submitted in accordance with General Condition clause 15.1; and they were contrary to section 33 of the DBC Act.
  5. [271]
    Appendix Part C of the Contract provided that the total construction period was 87 days, including 24 non-working days and that no allowance had been included for delay as a result of inclement weather.
  6. [272]
    General Condition clause 15.1 of the Contract provided the Builder’s entitlement to extensions of time if progress of the Works was delayed as a result of a matter set out.  The Builder was required to claim a reasonable extension within 10 Business Days from the day the delay ended setting out the causes and consequences of the delay.
  7. [273]
    Section 33 of the DBC Act subjects a contractor to a fine, where it does not make an allowance for the effect of inclement weather that is reasonable having regard to the time of year when the work is to be carried out.  These proceedings are not a prosecution of the Builder for a contravention of this requirement.  The DBC Act does not clearly restrict a contractor, who contravenes this provision from seeking an extension of time if it complies with the contractual framework.  The Contract remains enforceable.[96]  
  8. [274]
    Mr Gillham points to section 18 of the DBC Act to contend that the Builder may only seek an extension if the need for an allowance for the additional days could not reasonably have been foreseen by the building contractor when the Contract was entered into and that because Mr Kerhohan conceded, during his oral evidence, that inclement weather was inevitable the Builder should be prevented from claiming an extension of time where it did not make an allowance in the Contract.       
  9. [275]
    Section 18 of the DBC Act defines the effective completion date and the effective completion period and provides for how they are to be adjusted. The importance of these definitions is that section 90 of the DBC Act provides the owner a right to end the contract where the work is not finished within 1.5 times the relevant period calculated by reference to these definitions. Mr Gillham did not purport to exercise a right to end the Contract under section 90 of the DBC Act.  I am not satisfied that section 18 prevents the Builder from seeking an extension of time if it complies with the contractual framework.
  10. [276]
    The Builder is entitled to a reasonable extension of time to the Date for Practical Completion if the progress of the works is delayed by a cause in General Condition clause 15.1.  Where the reason for the delay was allowed for in Part C of the Appendix, the claim for an extension of time is to be for the delay in excess of the allowance.  There is nothing in General Condition clause 15.2, which prevents an extension of time claim where no allowance has been made in Part C of the Appendix.

Extension of time 1 - 8 April 2015 (2 days)

  1. [277]
    I find the Date for Practical Completion Stage was validly extended by 2 days to 12 June 2015.
  2. [278]
    The Builder claims an extension of 2 days for inclement weather on 1 and 2 April 2015.   The claim is within time as it was made on 8 April 2015 within 10 Business Days of the day the delay ended.  Mr Gillham conceded he agreed to the extension of time.
  3. [279]
    There is no evidence before me that Mr Gillham put the Builder on notice prior to the Date for Practical Completion Stage that he disputed the extension of time despite his previous agreement to allow the Builder to accelerate the programme of works.
  4. [280]
    In the Joint Experts’ Report,[97] the experts agree that it would be reasonable to claim for this delay.  I accept the Experts’ evidence that the works were delayed.

Extension of time 2 – 22 April 2015 (3 days)

  1. [281]
    I find the Date for Practical Completion Stage was validly extended by 3 days to 15 June 2015.
  2. [282]
    The Builder claims an extension of 3 days for extra work relating to the termite barrier installation.  This relates to Variation 1.  The claim describes dates on which the delay occurred as ‘30/03/2015; 07/04/2015; 08/04/2015; 09/04/2015’.  The claim is within time as it was made on 22 April 2015 within 10 Business Days of the day the delay ended.
  3. [283]
    Mr Gillham agreed to the extension of time by email dated 26 April 2015.  I am not satisfied that Mr Gillham ought to be permitted to resile from his agreement to this extension of time.  There is no evidence before me that Mr Gillham put the Builder on notice prior to the Date for Practical Completion Stage that he disputed the extension of time despite his previous agreement to allow the Builder to accelerate the programme of works.

Extension of time 3 – 11 May 2015 (2 days)

  1. [284]
    I find the Date for Practical Completion Stage was validly extended by 2 days to 17 June 2015.
  2. [285]
    The Builder claims an extension of 2 days for inclement weather on 30 April and 1 May 2015.   The claim is within time as it was made on 11 May 2015 within 10 Business Days of the day the delay ended.
  3. [286]
    In the Joint Experts’ Report,[98] the experts agree that it would be reasonable to claim for this delay.  By email dated 17 May 2015, Mr Gillham accepted that heavy rain on those days prevented work from being carried out.  I accept the Experts’ and Mr Gillham’s evidence that the works were delayed.
  4. [287]
    There is no evidence before me that Mr Gillham put the Builder on notice prior to the Date for Practical Completion Stage that he disputed the extension of time despite his previous agreement to allow the Builder to accelerate the programme of works.

Extension of time 4 (EOT 4) – 5 June 2015 (3 days)

  1. [288]
    I am not satisfied that EOT 4 validly extended the Date for Practical Completion Stage.
  2. [289]
    The Builder claims an extension of 3 days in relation to Variation 14, substitution of ornate cornice.  The claim describes reason for delay as:

Fix Timber Cornice in lieu of Plaster Cornice to 2700 high ceilings. Prepare Timber Cornice for Paint. Substitute Ornate Cornice for Timber Cornice in Dinning (sic) Area.

  1. [290]
    The claim describes the dates on which the delay occurred as ‘03/06/2015; 04/06/2015; 05/06/2015’.  The claim is within time as it was made on 5 June 2015. 
  2. [291]
    By email dated 6 June 2015, Mr Gillham disputed the extension of time claimed.   Under the Contract the Builder is entitled to a reasonable extension if the progress of the work was delayed.  There is insufficient evidence before me for me to be satisfied that the works were delayed.
  3. [292]
    Mr Dixon’s evidence was that the work the subject of VA14 would not justify an extension of time.[99]  Mr Carpenter did not clearly disagree with Mr Dixon’s evidence. I accept Mr Dixon’s evidence.

Extension of time 5 (EOT 5) – 9 June 2015 (7 days)

  1. [293]
    I am not satisfied that EOT 5 validly extended the Date for Practical Completion Stage.
  2. [294]
    The Builder claims an extension of time of 7 days in respect of the late installation of cabinetry. Mr Gillham was to supply and install cabinetry.  Mr Kernohan conceded the Builder was to co-ordinate with Mr Gillham’s cabinet maker. 
  3. [295]
    By email dated 13 June 2015 Mr Gillham disputed the extension of time claimed.
  4. [296]
    The evidence is that the delays were as a result of Builder initiated changes and therefore not a delay beyond its control as summarised in Mr Dixon’s report.[100]  Mr Carpenter did not clearly disagree with Mr Dixon’s evidence. I accept Mr Dixon’s evidence.

Extension of time 6 – 1 July 2015 (1 day)

  1. [297]
    I find the Date for Practical Completion Stage was validly extended by 1 day to 18 June 2015.
  2. [298]
    The Builder claims an extension of time of 1 day for inclement weather on 29 June 2015.   The claim is within time as it was made on 1 July 2015, within 10 Business Days of the day the delay ended.
  3. [299]
    In the Joint Experts’ Report,[101] the experts agree that it would be reasonable to claim for this delay.  I accept the Experts’ evidence that the works were delayed.
  4. [300]
    For the reasons set out earlier, the failure to make an allowance for inclement weather in Appendix C does not disentitle the Builder from making a valid claim to extend time.

Extension of time 7 (EOT 7) – 1 July 2015 (26 days)

  1. [301]
    I am not satisfied that EOT 7 validly extended the Date for Practical Completion Stage.
  2. [302]
    By email dated 16 July 2015, this claim was replaced by Extension of time 11.
  3. [303]
    To the extent that the Builder sought to resile from this position during the hearing the experts’ evidence, which I accept, is that tiling of the powder room was not on the critical path.[102] I am not satisfied that the Builder was delayed by these matters.

Extension of time 8 (EOT 8) – 1 July 2015 (unspecified number of days)

  1. [304]
    I am not satisfied that EOT 8 validly extended the Date for Practical Completion Stage.
  2. [305]
    The Builder claims an extension of time of a yet to be determined number of days in respect of delay in the delivery of tiles for the Northern patio.
  3. [306]
    The claim describes reason for delay as ‘Owner supplied tiles for northern patio are yet to arrive on site, no delivery date specified at present, final extent of time delay and extension of time request to be determined on arrival of tiles to site.’
  4. [307]
    General Condition clause 15.1 provides the claim is to be made within 10 Business Days of the day the delay ended.  On its face the delay had not yet ended.  The claim does not meet the requirements of the Contract.

Extension of time 9 (EOT 9) – 1 July 2015 (5 days)

  1. [308]
    I am not satisfied that EOT 9 validly extended the Date for Practical Completion Stage.
  2. [309]
    The Builder claims an extension of time of 5 days in respect of delay concerning installation of glass splashback to kitchen. 
  3. [310]
    Mr Gillham was responsible for supplying the splashback.  The claim describes reason for delay as ‘Client supplied splash back to Client supplied kitchen scheduled to be installed 03/07/2015.  EOT05 requests extension of time for Client supplied kitchen to 29/06/2015, further extension of time require (sic) as works not complete.’
  4. [311]
    The claim is within time as it was made on 1 July 2015, within 10 Business Days of the day the delay ended.
  5. [312]
    Mr Dixon’s evidence was that the work delayed was not on the critical path.[103]  Mr Carpenter did not clearly disagree with Mr Dixon’s evidence. I accept Mr Dixon’s evidence.  I am, therefore, not satisfied that the progress of the works were delayed by these matters.

Extension of time 10 (EOT 10) – 9 July 2015 (2 days)

  1. [313]
    I am not satisfied that EOT 10 validly extended the Date for Practical Completion Stage.
  2. [314]
    By email dated 16 July 2015, this claim was replaced by Extension of time 11.
  3. [315]
    To the extent that the Builder sought to resile from this position during the hearing the experts’ evidence, which I accept, is that tiling of the powder room was not on the critical path.[104] I am not satisfied that the Builder was delayed by these matters.

Extension of time 11 (EOT 11) – 16 July 2015 (15 days)

  1. [316]
    I am not satisfied that EOT 11 validly extended the Date for Practical Completion Stage.
  2. [317]
    The Builder claims an extension of time of 15 days in respect of delay concerning delivery of tiles for the powder room.
  3. [318]
    Mr Gillham was responsible for supplying the tiles.  The claim describes reason for delay as:

Delay with client supplied tile. The tile arrived onsite on the afternoon of Friday 26th June.  You advised me by email that they had arrived that afternoon.  I immediately re booked the tiler to attend site to finish the WC.  He was unavailable on Monday 29th and Tuesday 30th.  Tiling commenced on Wednesday 1 July.  On Friday 3 July we discovered we were short 2 boxes of Tiles and you were duly informed.  The extra tiles were delivered to site on the 7th July.  I immediately re booked the tiler who was available to attend site on the 8th July to complete the tiling and grouting of the WC.  My plumber was booked and completed installation of the toilet on the 9th July.  Kernohan Construction employees attended site of Friday 10th July to complete the second fix of the toilet roll holder and towel rail.  Suncoast joint sealing attended site on Monday 13th July to complete the silicon sealing of the toilet, vanity and floor wall junction.

  1. [319]
    In the Joint Expert Report,[105] the experts agreed that the tiling of the powder room was not on the critical path for completion of the works. I am, therefore, not satisfied that the progress of the works were delayed by these matters.

Extension of time 12 (EOT 12) – 24 July 2015 (10 days)

  1. [320]
    I am not satisfied that EOT 12 validly extended the Date for Practical Completion Stage.
  2. [321]
    The Builder claims an extension of time of 10 days in respect of delay concerning installation of aluminium flashing and sealing gaps.
  3. [322]
    The claim describes reason for delay as ‘Installation detail changed on the 15/07/2015 new detail confirmed 20/07/2015.  Installation complete 24/07/2015.’
  4. [323]
    Mr Dixon’s evidence is that as the Contract scope of work described that windows and doors were to be fitted and sealed and therefore the sealing of gaps rather than covering the gaps was always contemplated and that the extension of time claimed was not warranted.[106]  Mr Carpenter did not clearly disagree with Mr Dixon’s evidence. I accept Mr Dixon’s evidence.  I am, therefore, not satisfied that the progress of the works were delayed by these matters.

Was the Builder’s suspension valid? 

  1. [324]
    I find that the Builder validly suspended performance of the works.
  2. [325]
    The Builder has a right to suspend performance of the works where the Owner is in substantial breach of the Contract.[107]  The Date for Practical Completion Stage is deemed to be automatically extended by a period equivalent to the date the contractor gives notice of suspension until the date the contractor recommences the work.[108]  In this case the Builder did not recommence work prior to Mr Gillham taking possession on or about 4 December 2015.
  3. [326]
    Substantial Breach is defined to include an Owner failing to make payment on time.[109]
  1. [174]
    The Builder gave a notice of suspension on 7 August 2015 relying upon breaches by Mr Gillham including his failure to pay progress claim 6.  As found earlier in these reasons Mr Gillham was in breach of his obligation to assess and pay amounts properly owing under progress claim 6.   I am satisfied that Mr Gillham was in substantial breach of the Contract in failing to do so.
  1. [327]
    I find that the Date for Practical Completion Stage was deemed to have been extended by a period equivalent to the period 7 August 2015 to 4 December 2015.  

Are Liquidated Damages payable?

  1. [328]
    I find the Builder is to pay Mr Gillham $20,800.
  2. [329]
    Mr Gillham, in his final written submissions, claims that the Date for Practical Completion Stage was unchanged from that stipulated in the Contract i.e. 10 June 2015 and claims $70,400 calculated to the date he took possession upon receiving keys.
  3. [330]
    The Contract provided that liquidated damages would apply for each day of delay in achieving Practical Completion Stage in the amount of $400 per day ending on the day the works reached Practical Completion Stage or the date the owner takes possession, whichever is earlier.[110]  Mr Gillham previously claimed in his Further Amended Response[111] liquidated damages in the sum of $67,200 on the basis the works were not brought to Practical Completion by 17 June 2015, the then conceded adjusted Date for Practical Completion Stage.[112]
  4. [331]
    The Builder does not seek to set aside the daily rate agreed in the Contract.
  5. [332]
    For the reasons set out earlier Mr Gillham is entitled to liquidated damages for a period of 52 days, the period equivalent to 19 June 2015 to 7 August 2015.

Are damages after obtaining possession payable? Are actual damages for delay payable?  

  1. [333]
    I find no amount is payable by the Builder to Mr Gillham in respect of these claims.
  2. [334]
    Mr Gillham claims actual damages for the period 5 December 2015 to 31 March 2016 being the period which he contends he would have required to retain a new builder to undertake the defective and incomplete works and takes into account the industry shutdown at the end of the year and Mr Gillham’s obligation to mitigate his loss.  The Builder denies Mr Gillham’s entitlement on a number of grounds.
  3. [335]
    Mr Gillham contends that the liquidated damages clause does not preclude him from claiming actual damages that accrued after he obtained possession on the basis that the liquidated damages clause does not purport to provide an exclusive remedy.  The final submissions rely upon a discussion in Brooking on Building Contracts.[113]  The passage refers to rights conferred upon a proper construction of the relevant contract and also to rights upon termination of the contract by an owner.  The latter it suggests would give rise to not only liquidated damages, which had accrued prior to termination but also potentially to general damages, where there had been acceptance of a repudiation. 
  4. [336]
    Mr Gillham contends that as the Builder repudiated the Contract it is not entitled to rely upon its terms to limit its damages to that set out in the liquidated damages clause.  For the reasons outlined elsewhere in these reasons, I am not satisfied that Mr Gillham validly terminated the Contract and therefore I am not satisfied Mr Gillham is entitled to general damages upon the asserted repudiation by the Builder.
  5. [337]
    Even though General condition clause 18 does not expressly state that it is an exclusive remedy, as some commercial construction contracts do,  I am not satisfied that claims for actual loss are available to Mr Gillham in addition to his claim for liquidated damages.  The loss claimed arises from the Builder’s breach of its obligation to bring the works to Practical Completion Stage by the adjusted date, the same breach of contract as gives rise to the claim for liquidated damages.
  6. [338]
    Where a liquidated damages clause provides an amount is recoverable by the owner for delayed completion the authorities overwhelmingly support the view that they are an exhaustive remedy for delay and function as a liability cap even if the actual loss is more than the amount calculated by reference to the amount fixed by the parties as part of the risk allocation when the contract was formed.  An exception to this is where the liquidated damages amounts to a penalty and is unenforceable.  The Builder does not contend that the amount fixed constitutes a penalty.  There is no evidence before me to support a contention that the amount constitutes a penalty.
  7. [339]
    The Court of Appeal in Bartlett v Contrast Constructions Pty Ltd[114] held that the obligation to act reasonably and to mitigate one’s loss does not apply to a claim for liquidated damages unless the contractual provision requires the owner to act reasonably.  Mr Gillham’s decision to pay the money into the holding account and obtain possession affected his entitlement to liquidated damages and crystallised his claimable loss for the Builder’s delay in bringing the works to the Practical Completion Stage by the adjusted date. 
  8. [340]
    Even if I was satisfied that a claim for general damages was available I am not satisfied that a loss has been established on the balance of probabilities for the reasons set out below.
  9. [341]
    Mr Gillham claims for actual loss for the period 5 December 2015 to 31 March 2016.
  10. [342]
    During the hearing Mr Carpenter’s evidence was that the rectification of the defective work and incomplete work could be performed within 14 days.  Mr Dixon’s view was that including mobilisation the period would be in the order of six weeks.  Mr Carpenter did not specifically dispute that estimate.
  11. [343]
    Mr Ponsonby’s report references that he had been advised by Mr Dixon that an estimated date of completion of the expected rectification works would have been around mid to end of February 2016.[115] I accept that given the time of year the mobilisation is unlikely to have commenced before mid January and given the number of trades six weeks is a reasonable estimate of the time required, such that if Mr Gillham had an entitlement to claim for actual loss after obtaining possession then the relevant period would, in my view, be from 5 December 2015 to at least the end of February 2016.
  12. [344]
    Mr Gillham’s evidence is that given the steps he would have taken to develop a scope of works, seek tender submissions, consider tenders received and enter into a contract with a replacement contractor in much the same way as he did for the original works that those steps would be unlikely to have been able to be completed before the end of January in view of the industry shutdown.  The Builder does not take particular issue with this time period in its submissions.  In these circumstances, I accept the relevant period 5 December 2015 to 31 March 2016 is a reasonable timeframe for such a claim.
  13. [345]
    Mr Gillham’s claim is for $28,932[116] comprised as follows:
    1. (a)
      $2,905 for upkeep of the Doonan garden and grounds at $175 per week;[117]
    2. (b)
      $14,088 for loss of rental income at $950 per week less council rates at $813.84 per half year and property insurance at $275.42 per month;[118]
    3. (c)
      $4,960 for the upkeep of the grounds at the property the subject of the dispute;[119]
    4. (d)
      $508 for NBN fees for the property subject of the dispute;[120]
    5. (e)
      $6,424.95 for land tax.
  14. [346]
    He particularly relies upon the evidence of Mr Ponsonby, a chartered accountant, who was not required for cross examination.[121]  Mr Ponsonby is not an expert in real estate matters.  His expertise is in quantification.
  15. [347]
    Mr Ponsonby’s report is premised on his instructions that Mr Gillham intended to sell or rent out the Doonan property, in which Mr and Mrs Gillham were living while the works were being undertaken, once they moved into the premises the subject of the dispute, depending upon the market circumstances. 
  16. [348]
    His evidence is that Mr Gillham’s loss is:
    1. (a)
      $22,774 on the basis that the Doonan property would have been sold when Mr and Mrs Gillham moved into the property; and
    2. (b)
      $23,308 if the Doonan property was retained but rented. 
  17. [349]
    Mr Gillham concedes in his submissions that both of these amounts included the cost of changing the locks, in the sum of $801, which cannot be claimed twice and would be required to be deducted from this head of claim.   The final submissions seek the higher of the two alternatives.
  18. [350]
    The Builder contends there is no proper evidentiary basis underpinning Mr Ponsonby’s report to found a basis that I can be satisfied that Mr Gillham would have sold the Doonan property in the relevant period in which he seeks damages and that I cannot be satisfied that Mr Gillham would not have incurred the expenses claimed in any event.  
  19. [351]
    I accept that Mr Gillham provides some evidence to support the assumptions on which Mr Ponsonby based his opinions.  I also accept that the evidence relied upon by Mr Ponsonby to form some of his assumptions and therefore opinions are less than compelling.  Whilst Mr Ponsonby’s evidence was not challenged through cross examination I need to be satisfied that there is a proper basis for the opinions given.
  20. [352]
    The claims for holding costs and upkeep are necessarily speculative in duration because they are based on hypothetical timeframes.

Scenario 1 – sale of Doonan - $21,973[122]

  1. [353]
    I am not satisfied Mr Gillham has established loss on the balance of probabilities under this scenario. 
  2. [354]
    Mr Ponsonby considered it appropriate, in the absence of more appropriate information available to him, to adopt an average listing time period for the sale of the Doonan property as the average number of days on the market for the Sunshine Coast region of approximately 119 days by reference to a Domain Property Research Report for the 12 months to June 2016.[123] The median price of houses sold at the Sunshine Coast in that report was $525,000. 
  3. [355]
    There is no evidence before me of the number of properties sold, the number of properties listed but withdrawn unsold, the range of prices achieved upon sale nor the distribution of those prices.  There is also no evidence before me about how likely the Doonan property was to sell at a price acceptable to Mr Gillham or indeed at any price.  
  4. [356]
    Mr Gillham appointed a real estate agent to list the Doonan property for sale on 25 March 2015.[124]  The then list price of the Doonan property was $1,195,000.00. There is no evidence before me of the average number of days on the market for a property on the Sunshine Coast for a price in excess of $1 million. 
  5. [357]
    I am not satisfied that it is more likely than not that a property listed at more than double the median price would sell in the average 119 days of listing.  Intuitively one might think it is likely that the time period would be longer for a more expensive property but there is no evidence before me whether it would be longer or shorter.
  6. [358]
    Mr Ponsonby’s calculation of loss deducted the costs, which would have been incurred during the listing period against the calculation of loss prior to obtaining possession.  Mr Gillham has been compensated for that period through his claim for liquidated damages. 
  7. [359]
    In my view the appropriate methodology under this head of claim would be to assume that Mr Gillham would have put the Doonan property on the market once he obtained possession.  Even if I accepted Mr Ponsonby’s evidence that the likely listing period prior to sale is 119 days, about which I have reservations, the period 5 December to 31 March 2016 is less than 119 days in which case Mr Gillham would have incurred the holding and upkeep costs in any event so no loss is established in respect of those amounts.
  8. [360]
    Mr Gillham seeks to recover the holding and upkeep costs of both the Doonan property in the sum of $4,829[125] and the subject property in the sum of $17,144.[126]
  9. [361]
    He contends he is entitled to both even though he accepts that if he had occupied the subject property he would have incurred many, if not all, of the subject property expenses.  He says he has been deprived of the benefit of the expenses he would have incurred and therefore he should be compensated.  No authority for this proposition was relied upon in the final submissions.  Damages are to place a party in the same position, so far as money can do, as if the Contract had been carried out.  I am not satisfied Mr Gillham ought to be compensated for costs he would have incurred if completion of the works had not been delayed.  To do so would put Mr Gillham in a better monetary position. 
  10. [362]
    Mr Gillham claims holding costs in the amount of $11,678 on the basis that the proceeds of the sale of the Doonan property would have paid down the mortgage on the subject property.  Naturally this presupposes the Doonan property would have sold and sold for an amount sufficient to discharge the mortgage, about which there is no or at least very limited evidence before me.  I am not satisfied that Mr Gillham has established a loss in a particular amount on the balance of probabilities under this scenario. 

Scenario 2 – retain Doonan and rent out - $ 22,507[127]   

  1. [363]
    I am not satisfied Mr Gillham has established loss on the balance of probabilities under this scenario. 
  2. [364]
    Mr Ponsonby’s evidence as to Mr Gillham’s loss on the scenario of retaining the Doonan property and renting it out adopts an average listing time for rental properties, is premised on a telephone enquiry with an unnamed person from Ray White Tewantin. The qualifications of the person expressing the opinion at Ray White are not before me, and that person was not made available to be cross-examined by the Tribunal, or by the Builder’s legal representative.
  3. [365]
    Mr Ponsonby states he was informed by this unnamed person that there are a number of factors affecting the listing period for a rental property including location, price, condition of property, terms of lease and quality of the tenant.  He also states that this unnamed person informed him that the listing period, for a property with a weekly rental of approximately $600, is approximately 3 to 4 weeks and likely longer for a property with a higher rental.  Mr Ponsonby was provided with a rental appraisal, which estimated the property would achieve a rent of $930 - $970 per week including lawn maintenance.[128]  His evidence is that he took the factors into account and in the absence of more appropriate information he adopted a listing period of 30 days. Given that the rental appraisal is significantly higher than the rent referenced by the unnamed person this assumption appears to be without any proper foundation. 
  4. [366]
    Mr Ponsonby’s calculation of loss deducted the costs, which would have been incurred during the listing period against the calculation of loss prior to obtaining possession.  As noted earlier, Mr Gillham has been compensated for that period through his claim for liquidated damages. 
  5. [367]
    Mr Gillham’s evidence was that if he could not achieve a sale price of at least $1.1 million he would have rented the Doonan property out for between $930 - $970 per week and applied the net rent against the mortgage payments on the subject property.  On this scenario Mr Gillham would have continued to pay expenses for both properties during the listing time for sale for a period of time and then during the listing time for rental.  Mr Ponsonby’s report does not contemplate the impact of a dual listing prior to renting. 
  6. [368]
    I am not satisfied on the balance of probabilities that the upkeep costs would not have been incurred by Mr Gillham in the period 5 December to 31 March in any event.
  7. [369]
    During his oral evidence Mr Gillham gave evidence that if he was to rent out the Doonan property he would do so through a real estate agent and would incur management costs.  He conceded that the calculation of the amount of loss was overstated as no management fees had been deducted.  There is no evidence before me as to likely management fees and letting fees.
  8. [370]
    I accept that once rented Mr Gillham would not have incurred the $175 per week for upkeep of the garden and grounds for the Doonan property as maintenance would have been the tenant’s responsibility.

Land tax - $6,424.95

  1. [371]
    I find no amount is payable to Mr Gillham for this claim.
  2. [372]
    If Mr Gillham had moved into the property, the subject of the dispute, before 30 June 2015, he contends land tax would only have accrued on the Doonan property, which was valued at less than the threshold value. Land tax is levied upon property owned as at 30 June in any given year. Where the Commissioner is satisfied that the land was used as a home a land tax exemption may be granted even if it was not used as the persons principal place of residence continuously for the six month residency period ending when a liability for tax arises.  I accept that if Mr Gillham moved into the subject property prior to 30 June 2015 and applied for an exemption, the Commissioner may have exercised the discretion in his favour in which case no land tax would have been payable.
  3. [373]
    This loss is a loss for failure to bring the Contract to practical completion prior to 30 June, which is already compensated by Mr Gillham’s liquated damages claims.    Mr Gillham’s evidence is that he factored potential land tax liability into his liquidated damages calculation.[129]

Are damages payable by the Builder including for defective or incomplete work?

  1. [374]
    I find the Builder is to pay Mr Gillham $42,673.44 (incl GST).
  2. [375]
    Under the Contract the Builder was required to undertake the work in an appropriate and skilful way, with reasonable care and skill, in accordance with the Plans and Specification and in accordance with all relevant laws and legal requirements.[130]  The DBC Act imposed warranties of a similar nature.[131]
  3. [376]
    Mr Gillham in the final written submissions contends that if the Builder gave advice as to the mode of construction or materials to be used then the warranties imposed in General Conditions Clause 10.1 would also apply, including that the material should be appropriate for the purpose for which the materials were to be used and that the Builder would use reasonable care and skill in the circumstances in which the advice was given.  This is directed to an obligation to have better advised Mr Gillham in respect of the materials to be used for the soffits having regard to acoustic qualities.  For the reason set out earlier I am not satisfied that the Builder was under such an obligation.
  4. [377]
    I accept that a builder is ordinarily entitled to carry out rectification of defects and omissions and that upon a consideration of the facts in each case the builder may lose that right.
  5. [378]
    The parties engaged experts, who gave written evidence, produced a joint report[132] and gave oral evidence concurrently as to whether the Builder’s work was defective or incomplete and the reasonable costs of rectification.
  6. [379]
    Mr Gillham contends that where:
    1. (a)
      the experts do not agree as to the reasonable costs of rectification I should prefer the higher amount as more reflective of actual cost;
    2. (b)
      independent quotes have been obtained, which tend to be higher than the amount contained in the joint report, I should prefer the quote or invoice as more reflective of actual cost, which may contemplate a ‘call out’ fee given the location of the premises. 
  7. [380]
    The correct measure of damages is the cost of work, which is both reasonable and necessary to ensure Mr Gillham receives the benefit of the Contract entered into by the parties. [133]  I do not accept that a single quote or the actual costs incurred is necessarily the same as the reasonable and necessary costs, particularly as the contractors who provided the quote or actually performed the work did not provide evidence in the proceedings. The evidence in respect of each item is required to be assessed.
  8. [381]
    From in or about early December 2015, upon payment of the disputed claim into the Master Builders Holding Account, the Builder has continued to assert that it is willing to attend to defective or incomplete works.  Given the disputes that have arisen, Mr Gillham, perhaps understandably, has refused to allow the Builder to attend to those items, which it previously admitted.
  9. [382]
    Mr Gillham also contends that he has terminated the Contract and the Builder no longer has any entitlement to perform the rectification work itself.  Mr Gillham claims that it asserted this right by his former lawyer’s letter of 25 February 2016.[134] 
  10. [383]
    I am not satisfied that this was an unequivocal communication of such an election.  With very few exceptions Mr Gillham did not purport to act upon his claimed termination by engaging others to perform work.  Mr Gillham only clearly asserted his termination in the pleading filed by leave on the second day of the final hearing, although I understand the pleading was provided to the Builder shortly before the hearing commenced.  Until then there were no unequivocal acts by Mr Gillham purporting to accept the Builder’s alleged repudiation of the Contract. 
  11. [384]
    Whilst I accept it is possible to terminate a contract by commencing proceedings or by defending and making a counter-application it is necessary to clearly make an election to terminate.  It is also necessary to make such an election within a reasonable time of the repudiatory conduct relied upon otherwise the right to terminate will be waived.  I am not satisfied that Mr Gillham elected to accept the Builder’s alleged repudiation within a reasonable time.    It is therefore unnecessary to determine whether the Builder’s conduct amounted to repudiation of the Contract.
  12. [385]
    Whilst Mr Gillham has a duty to mitigate his loss I am not inclined to allow the Builder to return to rectify the defects or complete the incomplete works.  Given the relationship between the parties, demonstrated by the fact that claims for less than $20 have been pursued and defended, that is likely to promote further disputes between them.  If Mr Gillham had permitted the Builder to rectify the items admitted then his loss would have been less.  The Builder continued to assert during the hearing its willingness to return to rectify and complete works.   While the experts’ evidence was that 15% would be appropriate in particular in respect of defective work, in these circumstances, on balance, I find that a reasonable margin is 10%.

Scott schedule 1 – Incorrectly installed Soffits using 6mm FC Sheeting instead of 9mm FC Sheeting - $24,691.01

  1. [386]
    As set out earlier in these reasons, I find no amount is payable to Mr Gillham in respect of this item as he ought not be permitted to resile from the instruction provided and relied upon by the Builder.

Scott schedule 2 – Failed to relocate Gazebo - $2,324.97(incl GST)[135]- Failed to relocate pavers - $1,533.32(incl GST)

  1. [387]
    I find the Builder is to pay Mr Gillham $2,223.88 (incl GST) in respect of the failure to relocate the Gazebo. I find no amount is payable in relation to the relocation of the pavers. 
  2. [388]
    The evidence is that the gazebo was not relocated. 
  3. [389]
    I accept the experts’ evidence that the failure to relocate the gazebo was incomplete work and that the reasonable cost of completion is $1,837.92 (excl builder’s margin and GST).[136]
  4. [390]
    For the reasons set out earlier, I find that a reasonable margin is 10%.
  5. [391]
    Mr Gillham contends that relocating the gazebo under the Contract included relocating the pavers and therefore the failure to relocate the pavers is also incomplete work.   
  6. [392]
    I accept the experts’ evidence that moving the pavers was not a necessary and integral part of relocating the gazebo.  The Contract did not specifically call for the moving of the pavers. I am not satisfied that this is incomplete work.

Scott schedule 3 - Gutter guard - $4,840(incl GST)[137]

  1. [393]
    I find the Builder is to pay Mr Gillham $1,998.58 (incl GST) in respect of this item.
  2. [394]
    Mr Gillham claims the amount the Builder quoted him in variation 17 to install gutter guard.[138] 
  3. [395]
    The Builder accepts the experts’ evidence that its failure to install gutter guard was incomplete work and that the reasonable cost of completion is $1,651.72 (excl builder’s margin and GST).  I also accept the experts’ evidence, including that $4,840 is not a fair and reasonable sum for this work, even though the Builder quoted this amount.
  4. [396]
    For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 4 – stand-alone air-conditioning unit - $990

  1. [397]
    I find the Builder is to pay Mr Gillham $457.97 (incl GST) in respect of this item.
  2. [398]
    I accept that page 13 of the Approved Building Drawings[139] provided an instruction to the Builder to reconnect and commission the removed existing air-conditioning unit and that failure to do so is incomplete work. 
  3. [399]
    Mr Gillham relies upon a quote.[140]  The experts agreed that the reasonable cost to install the unit is $378.49 (excl builder’s margin and GST).  Given the significant difference between the experts’ agreed opinion and the quote from a sole contractor, who did not give evidence in these proceedings, I prefer the experts’ agreed opinion. For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 5 - Supply of Fondis unit - $3,659 

  1. [400]
    I find that the Builder is to pay Mr Gillham $3,659 (incl GST) in respect of this item.
  2. [401]
    The Builder contends that it did not include any amount for the supply of the unit in its tender.  Mr Kernohan’s evidence is that prior to entering into the Contract he informed Mr Gillham that no allowance had been made.  Mr Gillham denies this occurred and points to other clarifications made to the documents as a consequence of the pre-contract discussions.  He also points to post contract communications, including on 11 April 2015, only a few weeks after the Contract was signed, where he indicated an intention to order and pay for the unit he had selected but reminded the Builder that the Contract called for it to supply and install the unit and that Mr Kernohan did not take issue with that reminder.[141]
  3. [402]
    The Builder’s version is consistent with the Builder’s amended tender, which forms part of the Contract, which does not provide for any amount for the unit and provides ‘Appliances by Owner’.[142]   The Approved building plans, which form part of the Contract also provides that Mr Gillham is to supply the unit.[143] However, the Specification provided that the unit was to be supplied and installed by the Builder.[144]
  4. [403]
    Where there is a discrepancy between documents that form part of the Contract it is to be resolved by General Condition clause 3, which provides that the Specification takes precedence over the plans and any other documents.  There is no specific claim by the Builder to rectify the Contract on the basis of mistake.  There is insufficient evidence for me to be satisfied that there was a mutual mistake or that Mr Gillham sought to unconscionably take advantage of the ambiguity and the Builder’s omission.
  5. [404]
    The evidence before me is that Mr Gillham paid $3,659 for the unit.[145]  Attached to Mr Kernohan’s initial statement of evidence is a document, which purports to claim a variation for the supply of the Fondis unit in the amount of 3,326.36 (excl GST). [146]  Mr Gillham’s evidence is that he did not receive this document prior to receiving the statement.  The variation is not pursued by the Builder.  Given the similarity in the amounts and in the absence of other evidence, I accept that Mr Gillham ought to be reimbursed the amount actually paid by him.

Scott schedule 6 - Installation of Fondis unit - $726.02 (incl GST)[147] 

  1. [405]
    I find that the Builder is to pay Mr Gillham $694.46 (incl GST) in respect of this item. 
  2. [406]
    The Builder accepts that it is liable for its failure to install the Fondis unit to the wine cellar and construct a reveal as directed by Mr Gillham by use of an external reveal and without further insulation.  It accepts the experts’ evidence that the reasonable cost of completion is $573.93 (excl builder’s margin and GST).  I accept the experts’ evidence. 
  3. [407]
    For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 7 - Installation of racks in wine cellar - $469.06[148] 

  1. [408]
    I find that the Builder is to pay Mr Gillham $448.67(incl GST) in respect of this item. 
  2. [409]
    The Builder accepts that it is liable for its failure to install the racks to the wine cellar following instruction by Mr Gillham to install the Fondis unit incorporating an external reveal and without further insulation.  It accepts the experts’ evidence that the reasonable cost of completion is $370.80 (excl builder’s margin and GST).  I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 8 – Failure to supply wine racks - $3,784

  1. [410]
    I find that the Builder is to pay Mr Gillham $3,784 (incl GST) in respect of this item.
  2. [411]
    The Builder disputes it was obliged to supply the racks.  It points to the Approved building plans, which form part of the Contract which provides that Mr Gillham is to supply the wine racks.[149] However, the Specification provided that the wine racks were to be supplied and installed by the Builder.[150]
  3. [412]
    Where there is a discrepancy between documents that form part of the Contract it is to be resolved by General Condition clause 3, which provides that the Specification takes precedence over the plans and any other documents.  There is no specific claim by the Builder to rectify the Contract on the basis of mistake.  There is insufficient evidence for me to be satisfied that there was a mutual mistake or that Mr Gillham sought to unconscionably take advantage of the ambiguity and the Builder’s omission.
  4. [413]
    Mr Gillham points to post contract communications, including on 10 June 2015 where he indicated he had ordered and paid for the racks he had selected but reminded the Builder that the Contract called for it to supply and install the racks and that Mr Kernohan did not take issue with that reminder.[151]
  5. [414]
    The evidence before me is that Mr Gillham paid $3,784 for the racks.[152] Attached to Mr Kernohan’s initial statement of evidence is a document, which purports to claim a variation for the supply of the wine racks in the amount of 3,440 (excl GST). [153] Mr Gillham’s evidence is that he did not receive this document prior to receiving the statement.  The variation is not pursued by the Builder.  Given the similarity in the amounts and in the absence of other evidence, I accept that Mr Gillham ought to be reimbursed the amount actually paid by him.

Scott schedule 9 – VA27 

  1. [415]
    This item related to the Builder’s variation document claiming for the supply of the Fondis unit and wine racks.  The claim is not pursued by the Builder and therefore is not pursued by Mr Gillham.

Scott schedule 10 - Failure to complete garden swale - $7,498.92[154] 

  1. [416]
    I find that the Builder is to pay Mr Gillham $1,524.60 (incl GST).
  2. [417]
    The scope of works provided for the construction of ‘drainage swale as shown’.  Mr Kernohan conceded that the Builder had not completed this work.  His evidence was that it was a two hour job with a bobcat.  The experts agree, and I accept, that this is an item of incomplete work.  They also agree that there is a lack of detail showing the extent of the work required including that there are no relative levels (RLs) provided. 
  3. [418]
    Mr Dixon’s evidence as to the costs to complete this work is significantly more than Mr Carpenter’s.  This is because he has allowed for imported fill. 
  4. [419]
    Page 2 of the Approved plans provide

Ground to be graded so that no water ponds & falls away from Residence.  Advise yard pit or pits with pipe to take water away from area & dwelling

  1. [420]
    The Contract does not expressly contemplate the importation of fill.  It contemplates grading the ground.  I am not satisfied that the importation of fill was reasonably required by the Contract.  I therefore prefer Mr Carpenter’s evidence as to the reasonable costs of completing the work, being $1,260 (excl builder’s margin and GST).

Scott schedule 11 & 20 - Installation of pavers and rectify spilled concrete - $184.66[155] 

  1. [421]
    I find that the Builder is to pay Mr Gillham $176.64 (incl GST) in respect of this item.
  2. [422]
    The Builder accepts the experts’ evidence that its failure to install pavers and rectify spilled concrete to the west patio was incomplete work and that the reasonable cost of completion is $145.98 (excl builder’s margin and GST).  I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 12 - Installation of weather seals - $648.69[156] 

  1. [423]
    I find that the Builder is to pay Mr Gillham $620.49 (incl GST) in respect of this item.
  2. [424]
    The Builder accepts the experts’ evidence that its failure to install door weather seals was incomplete work and that the reasonable costs of completion is $133.52 (excl builder’s margin and GST) if it delivers the seals to Mr Gillham and $512.80 (excl builder’s margin and GST) if it does not.  There is insufficient evidence before me to be satisfied that the seals remain in good condition.  I am not inclined to allow the Builder to deliver up the seals claimed to be held.  Given the relationship between the parties that is likely to promote further disputes between them. I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 13 – re-instate wire mesh in carport - $17.01[157]

  1. [425]
    I find that the Builder is to pay Mr Gillham $16.27 (incl GST) in respect of this item.
  2. [426]
    The evidence is that wire mesh panels were removed from the carport at some point by persons unknown and not reinstated by the Builder.   Mr Kernohan’s evidence was that the Builder had reinstated the mesh and that he did not know when or why it had been removed again but that he was not on site at all times.  Mr Gillham’s evidence is that he did not remove or authorise anyone to remove it. 
  3. [427]
    I accept that it is more likely than not that reinstatement of the panel was incomplete work under the Contract.
  4. [428]
    The experts’ agree that the reasonable cost to complete this work is $13.45 (excl builder’s margin and GST).  I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 14 - Vermin proof workshop, gym and garage block - $24.29[158] 

  1. [429]
    I find that the Builder is to pay Mr Gillham $23.23 (incl GST) in respect of this item.
  2. [430]
    The Builder accepts the experts’ evidence that its failure to vermin proof the workshop, gym and garage block was incomplete work and that the reasonable costs of completion is $19.20 (excl builder’s margin and GST).  I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 15 - Reinstate riser to the external irrigation pipe- $353.44[159]

  1. [431]
    I find that the Builder is to pay Mr Gillham $338.07 (incl GST) in respect of this item.
  2. [432]
    The Builder accepts the experts’ evidence that its failure to reinstate the riser to the external irrigation pipe was incomplete work and that the reasonable cost of completion is $279.40 (excl builder’s margin and GST).  I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 16 - Installation of various timber doors - $556.60[160] 

  1. [433]
    I find that the Builder is to pay Mr Gillham $532.40 (incl GST) in respect of this item.
  2. [434]
    The Builder accepts the experts’ evidence that its installation of doors in an untradesman-like manner was incomplete work and that the reasonable cost of completion is $440 (excl builder’s margin and GST).  I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 17 & 18 - Failure to complete Rockcote rendering and fascia to exterior of wine cellar - $405.36[161]  

  1. [435]
    I find that the Builder is to pay Mr Gillham $387.74 (incl GST) in respect of this item.
  2. [436]
    The Builder accepts the experts’ evidence that its failure to complete Rockcote rendering and the fascia to the exterior of the wine cellar was incomplete work and that the reasonable cost of completion is $320.45 (excl builder’s margin and GST).  I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 19 - Undulations in concrete slab to north patio - $632.50[162]

  1. [437]
    I find that the Builder is to pay Mr Gillham $605 (incl GST) in respect of this item.
  2. [438]
    The Builder accepts the experts’ evidence that its failure to rectify undulations in the concrete slab to the north patio so that tiles may be laid was incomplete work and that the reasonable cost of completion is $500 (excl builder’s margin and GST).  I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 21 - Remove construction waste - $136.96[163] 

  1. [439]
    I find that the Builder is to pay Mr Gillham $131 (incl GST) in respect of this item.
  2. [440]
    The Builder accepts the experts’ evidence that its failure to remove construction waste and rubbish was incomplete work and that the reasonable cost of completion is $108.27 (excl builder’s margin and GST).  I accept the experts’ evidence. For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 23 - Crack in cornice in bedroom 1 - $22.50[164]  

  1. [441]
    I find that the Builder is to pay Mr Gillham $21.53 (incl GST) in respect of this item.
  2. [442]
    The Builder accepts the experts’ evidence that its failure to repair the crack was defective work and that the reasonable cost of rectification is $17.79 (excl builder’s margin and GST).  I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 25 - Install acoustic door seal - $1,021.61[165]

  1. [443]
    I find that the Builder is to pay Mr Gillham $977.20 (incl GST) in respect of this item. 
  2. [444]
    The Builder accepts the experts’ evidence that its failure to install acoustic door seals was incomplete work and that the reasonable costs of completion is $274.70 (excl builder’s margin and GST) if it delivers the seals to Mr Gillham or $807.60 (excl builder’s margin and GST) if it does not.  There is insufficient evidence before me to be satisfied that the seals remain in good condition.  I am not inclined to allow the Builder to deliver up the seals claimed to be held.  Given the relationship between the parties that is likely to promote further disputes between them. I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 26 - Roof tiling - $85.86[166] 

  1. [445]
    I find that the Builder is to pay Mr Gillham $82.12 (incl GST) in respect of this item.
  2. [446]
    The Builder accepts the experts’ evidence that its failure to rectify the roof tiling is defective work. The Builder accepts that the reasonable cost of rectification is $67.87 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 27 - Metal fascia and gutters - $195.72[167] 

  1. [447]
    I find that the Builder is to pay Mr Gillham $187.21 (incl GST) in respect of this item.
  2. [448]
    The Builder accepts the experts’ evidence that the gutters allow ponding of water, being incomplete work. The Builder accepts the experts’ evidence that the reasonable cost of completion is $154.72 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 28 - Install additional supports so trusses can support hot water heaters - $1,602[168] 

  1. [449]
    I find that the Builder is to pay Mr Gillham $970.08 (incl GST) in respect of this item.
  2. [450]
    The Builder accepts the experts’ evidence that it failed to install additional supports that are required so that the trusses can support the two hot water heaters in the loft and that the reasonable cost of rectification is $801.72 (excl builder’s margin and GST). I prefer the independent experts’ evidence as to the reasonable cost of rectification to the quote from a sole contractor, who did not give evidence in these proceedings, included in the evidence before me, upon which Mr Gillham relies.[169]  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 29 - Install and commission roller shutters - $2,150.50[170] 

  1. [451]
    I find that the Builder is to pay Mr Gillham $2,057.00 (incl GST) in respect of this item.
  2. [452]
    The Builder accepts the experts’ evidence that it failed to complete the installation and commissioning of the roller shutters and that the reasonable cost of completion is $1,700.00 (excl builder’s margin and GST). I accept the experts’ evidence including that this work could not be undertaken prior to the installation of tiling on the northern patio.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 32 - Complete installation of R6 batts - $676.19[171] 

  1. [453]
    I find that the Builder is to pay Mr Gillham $646.79 (incl GST) in respect of this item.
  2. [454]
    The Builder accepts the experts’ evidence that it failed to complete installation of the R6 batts.  The Joint Report sets out different opinions as to the costs of completion. 
  3. [455]
    Having regard to the concessions made by Mr Carpenter during the concurrent expert evidence, including that he did not inspect the roof space and Mr Dixon’s explanation of his observations, whilst in the roof space, I accept Mr Dixon’s evidence that there were gaps, which he assessed at 5%, which ought to be insulated and accept his evidence that the reasonable cost of completion is $534.54 (excl builder’s margin and GST).  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 33 - Complete installation of R3.5 batts - $60.77[172]  

  1. [456]
    I find that the Builder is to pay Mr Gillham $58.13 (incl GST) in respect of this item.
  2. [457]
    The Builder accepts the experts’ evidence that it failed to complete installation of R3.5 batts and that the reasonable cost of completion is $48.04 (excl builder’s margin and GST). I accept the experts’ evidence. For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 34 - Clean site – residence, garage, workshop, gym - $1,064.56[173] 

  1. [458]
    I find that the Builder is to pay Mr Gillham $1,018.28 (incl GST) in respect of this item.
  2. [459]
    The Builder accepts the experts’ evidence that it failed to clean the site, in particular failed to clean the residence, garage, workshop and gym and that the reasonable cost of completion is $841.55 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 35 - Scratched glass panes - $5,280[174] 

  1. [460]
    I find that the Builder is to pay Mr Gillham $602.99 (incl GST) in respect of this item.
  2. [461]
    Mr Gillham relies upon a quote in the sum of $5,280 (incl GST), which indicates that the work to remove all scratches requires two men for three days and that the day rate is $1600 (excl GST).  The covering email indicates that if less scratch removal was performed such that the most noticeable scratches were to be removed that could be achieved by two men in one day.[175] 
  3. [462]
    The Builder accepts the experts’ evidence that the glass panes of various windows and doors are scratched and require rectification, and that the reasonable cost of rectification is $498.34 (excl builder’s margin and GST). I prefer the independent experts’ evidence to the quote from a sole contractor, who did not give evidence in these proceedings, in evidence before me relied upon by Mr Gillham.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 36 - Aluminium joinery - $1,441[176] 

  1. [463]
    I find that the Builder is to pay Mr Gillham $363.00 (incl GST) in respect of this item.
  2. [464]
    Mr Gillham relies upon a quote in the sum of $1,441 (incl GST).[177]
  3. [465]
    The Builder accepts the experts’ evidence that there are defects to the aluminium joinery and that the reasonable costs of rectification is $300.00 (excl builder’s margin and GST). The experts agree that part of the works identified in the quote should not form part of the reasonable cost of rectification.  That work is not separately costed in the quote.  I prefer the independent experts’ evidence to the quote from a sole contractor, who did not give evidence in these proceedings, relied upon by Mr Gillham.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 37 - Adjust door hardware - $408.34[178] 

  1. [466]
    I find that the Builder is to pay Mr Gillham $390.59 (incl GST) in respect of this item.
  2. [467]
    The Builder accepts the experts’ evidence that it failed to properly adjust various door hardware and the reasonable cost of rectification is $322.80 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 38 - Gaps between wall sheeting and ceiling sheeting - $28,417[179]

  1. [468]
    I am not satisfied that loss in any particular amount has been established and therefore find that no amount is payable by the Builder to Mr Gillham in respect of this item.  I am not satisfied that Mr Gillham has established that the Builder is in breach of its obligations under the Contract.
  2. [469]
    Mr Gillham contends that the Builder is required to rectify the gaps and particularly relies upon a report from Mr Yorke of TTM Consulting Pty Ltd, acoustic engineers[180] and a single quote as to the costs of rectification.[181] 
  3. [470]
    Mr Dixon’s reports record that there are gaps ranging from 5mm to approximately 12 mm, which he regards as defective work given that the Scope of work specified that “The provision of a high level of acoustic insulation to protect from aircraft noise etc is a high priority”.  Mr Yorke’s evidence was that he observed gaps ranging from 2 – 20 mm.
  4. [471]
    The scope of work sets out two methods of installing ceilings.[182]  Special condition 2 provides that the term Specification includes the scope of work.  Neither of the methods specify that the wall and ceiling joint is to be completely sealed. 
  5. [472]
    Method one states that cornice is to be cemented to walls with a spacing of approximately 3-5mm between the top edge of the cornice and the underside of the plaster and the gap to be filled with paintable resilient silicon. Method two provides that cornice are to be fitted as per normal practice. 
  6. [473]
    During their concurrent oral evidence the experts agreed that it is usual industry practice to leave a 10mm gap behind cornice.
  7. [474]
    The ceiling plan provides for the locations where method one or method two are to be constructed.[183]  Essentially method one is to be used in the master bedroom and bedroom two, with the balance of the residence method two.  There are no other specific requirements in the contract documents, which I have located or to which I have been referred.
  8. [475]
    I accept that the Builder was aware both through pre-contract discussions and the tender documents that a high level of acoustic insulation was a high priority.  As previously identified, there is no evidence before me that the Builder held itself out as having any particular expertise in this field.  The Builder was required to perform the Contract in accordance with the Contract documents.
  9. [476]
    Mr Dixon recommended an acoustic engineer be consulted to conduct tests to confirm if there was an acoustic deficiency at the wall/ceiling intersections and speculated that the profile of the cornice might assist to sufficiently nullify noise penetration.[184] 
  10. [477]
    The evidence is that Mr Gillham did not follow Mr Dixon’s recommendation prior to engaging a contractor to remove some cornice.  On-site testing was therefore compromised. 
  11. [478]
    Mr Yorke, an engineer with one year’s experience in the acoustic engineering industry at the time of preparation of the report, gave evidence that he recommended that all existing gaps be properly sealed airtight at the ceiling and wall junctions of acoustically sensitive rooms in order to achieve the acoustic performance of the Alpha Acoustic report, which specified the requirements for acoustic attenuation for the building envelope, including roof, ceiling, walls, glazing and doors. Mr Yorke gave evidence that he has a civil engineering degree and a graduate diploma in acoustics.  He gave evidence that he did not conduct on-site testing, including because the attenuation was to address future aircraft noise. A logical extension of this reasoning is that the attenuation to be provided by the original Alpha Acoustic Report could not be confirmed until after the future aircraft noise commenced and therefore the extent to which the as constructed work failed to meet this attenuation could never be established.  His report also does not indicate that he undertook computer simulations to identify any acoustic deficiency of the work as performed by the Builder.
  12. [479]
    Mr Yorke’s evidence does not expressly refer to the requirements of the Contract as distinct from the Alpha Acoustic report, which was an input into the Specifications for the Contract but did not form part of the Contract.
  13. [480]
    The Alpha Acoustic report was not provided to the Builder prior to entering into the Contract.  In any event it does not clearly refer to the requirements for the ceiling and wall junctions. 
  14. [481]
    I am not satisfied that the Contract required the wall and ceiling junction to be constructed as recommended by Mr Yorke.  I am also not satisfied that Mr Gillham’s demand that observed gaps be sealed, in purported compliance with the terms of the Contract but as I have found in excess of the Contract requirements, and Mr Kernohan’s agreement that they would be sealed is a binding agreement (including because I am not satisfied as to the consideration passing between the Builder and Mr Gillham for this additional obligation), which imposes upon the Builder an obligation to seal the ceiling and wall junctions as recommended by Mr Yorke.
  15. [482]
    Mr Yorke was not challenged as to the statement in his report about the measures required to achieve the required acoustic performance. However I clarified with Mr Yorke that the requirement to which he referred was that contained in the Alpha Acoustic report after being informed by Mr Yorke that he could not recall having been provided with a complete copy of the Contract. 
  16. [483]
    The Builder was entitled to accept the evidence as presented and make submissions as to the relevance of the evidence to the issues in dispute. I do not accept that because Mr Yorke was not challenged on that opinion, that there is no ability to challenge the veracity of his evidence. Mr Yorke’s evidence was, in my view, directed to the wrong question.
  17. [484]
    Even if I was satisfied that the Builder was in breach of the Contract, because the Alpha Acoustic report had not been complied with, which I am not, I do not accept that the reasonable cost of rectification accords with the quote from a sole contractor, who did not give evidence in these proceedings, upon which Mr Gillham seeks to rely.  I prefer the joint experts’ evidence that the reasonable cost of rectification is $2,208.40 (excl builder’s margin and GST). 
  18. [485]
    I accept that there is evidence that some of the gaps exceeded the usual industry practice of 10 mm.  There is insufficient evidence before me for me to able to quantify the extent of any such failure or the reasonable cost of the work required to rectify this portion of the work.

Scott schedule 39 – remove cornice - $280.50[185]

  1. [486]
    I find that no amount is payable by the Builder to Mr Gillham in respect of this item. 
  2. [487]
    Mr Gillham engaged a contractor to remove some cornice to establish the extent of gaps between the ceilings and walls.  He claims the costs of doing so.[186]
  3. [488]
    For the reasons set out above I am not satisfied that Mr Gillham has established that the Builder is in breach of its obligations under the Contract.   I am therefore not satisfied that Mr Gillham is entitled to the costs of attempting to prove a breach by the Builder. 

Scott schedule 40 - three large cedar framed mirrors - $2,261.58[187]

  1. [489]
    I find that the Builder is to pay Mr Gillham $2,163.25 (incl GST).
  2. [490]
    The Builder conceded that these mirrors were removed to allow works to proceed and were stored elsewhere on site and went missing.  Special condition 10 imposed upon the Builder an obligation to protect existing fittings and fixtures in Ensuite 1, Walk in Robe, Ensuite 2 and WC2, which were to be retained.
  3. [491]
    The experts’ evidence is, and I accept, that the three missing mirrors were located in the rooms specified in Special condition 10 prior to the construction commencing.
  4. [492]
    I accept that the Builder’s failure to ensure the mirrors were retained safely has caused Mr Gillham loss.  Mr Dixon’s evidence of the reasonable costs of re-instatement was based on Cordell’s rate for bevelled edged mirrors rather than cedar framed mirrors, in the amount of $1,787.81 (excl builder’s margin and GST).  Mr Carpenter contended that three quotes should be obtained for an agreed specification in order to ascertain an appropriate amount.
  5. [493]
    During the hearing Mr Kernohan disputed that the mirrors were worth the amount claimed but did not provide any contrary evidence of their value.  In the absence of other evidence as to value I accept Mr Dixon’s evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 41 - Basins in ensuite 1 and 2 - $1,096.88[188] 

  1. [494]
    I find that the Builder is to pay Mr Gillham $1,049.19 (incl GST) in respect of this item.
  2. [495]
    The Builder accepts the experts’ evidence that its failure to replace basins in ensuite 1 and ensuite 2 that were damaged by the Builder or its sub-trades during the period that the works were being carried out on the site is defective work for which it is responsible, and that the reasonable cost of rectification is $867.10 (excl builder’s margin and GST). I accept the experts’ evidence. For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 42 - Vinyl flooring in cellar - $232.73[189] 

  1. [496]
    I find that the Builder is to pay Mr Gillham $222.62 (incl GST) in respect of this item.
  2. [497]
    The Builder accepts the expert’s evidence that new vinyl flooring in the cellar requires replacement because it was damaged and that the reasonable cost of rectification is $183.98 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 43 - Front door handle - $454.70[190] 

  1. [498]
    I find that the Builder is to pay Mr Gillham $434.93 (incl GST) in respect of this item.
  2. [499]
    The Builder accepts the experts’ evidence that the front door handle was damaged and requires repair or replacement, and that the reasonable cost of rectification is $359.45 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 44 – Rainwater tank contamination - $172.50[191]

  1. [500]
    I am not satisfied that Mr Gillham has established that any amount is payable by the Builder in respect of this item.
  2. [501]
    Mr Gillham claims half of the costs he says he spent cleaning the tank. A copy of the invoice does not appear to be in evidence before me.  Both parties agree that cleaning the tank did not form part of the Contract and that the tank needed to be cleaned. 
  3. [502]
    Mr Kernohan’s evidence is that the tank was dirty prior to the Builder’s commencement of work such that the tank required cleaning whether or not any building debris entered the tank.  Mr Gillham conceded in cross examination that the tank was always going to need to be cleaned.  I accept that some building debris may have entered the tank but there is no evidence before me about how much the cleaning of the tank would have cost if building debris did not enter the tank.

Scott schedule 45 – Front gate - $63.76[192]

  1. [503]
    I am not satisfied that any amount is payable by the Builder to Mr Gillham in respect of this item.
  2. [504]
    Mr Gillham claims the gate was damaged by the Builder or its sub-trades or agents while the works were being carried out in that the hinges and a metal bolt were bent out of shape making the gate ‘impossible to close’.  He also claims the hinges, gate posts and adjoining fence rails were damaged by the practice of lifting the gate from its hinges whilst remaining chained to the other side of the gate and left hanging at an angle rather than unlocking the padlock to gain access.  There is evidence before me that he raised with the Builder the damage this practice was causing to the gate and that despite having raised his concern the practice re-occurred.[193]
  3. [505]
    The Builder denied that it or its sub-trades or agents were responsible for the damage.  Mr Kernohan conceded he was not on site at all times.   Persons for which the Builder was not responsible had access to the site during the works. 
  4. [506]
    Mr Dixon gave evidence that the gates were operational at the time of his inspection but the arm to the metal gate latch apparatus was bent.  Mr Dixon’s evidence was that ‘he had no supporting evidence to directly apportion blame for the damage to the gates....the damage could have occurred during the Contract works period.’[194] 
  5. [507]
    There is no specific evidence before me about how the damage Mr Dixon observed was caused.  The damage in respect of which Mr Gillham gave evidence does not fully accord with the damage referred to in Mr Dixon’s report.   I am not satisfied that Mr Gillham has discharged his onus of proving this claim.

Scott schedule 46 – Bitumen driveway - $126.02[195]

  1. [508]
    I find that the Builder is to pay Mr Gillham $102.54 (incl GST) in respect of this item. 
  2. [509]
    Mr Gillham claims that the Builder’s foreman told him that the damage was caused by a truck delivering materials to the site, which turned off the driveway to deliver tiles closer to the house.  Mr Dixon’s evidence essentially is that the damage is consistent with this cause.  The Builder’s foreman was not called to give contrary evidence.  On the balance of probabilities, I find that the damage was caused in this way. 
  3. [510]
    Mr Dixon’s report acknowledged that there are numerous cracks to the surface of the bitumen but no other damage apart from that claimed by Mr Gillham. Mr Carpenter’s evidence was that the damage was caused through normal wear and tear.  Mr Kernohan’s evidence was that the driveway was likely to have been about 30 years old.
  4. [511]
    I accept that the Builder had a duty to use reasonable care to not damage fixtures to Mr Gillham’s land, which were being retained.  There is no evidence before me about the reasonable steps the Builder took to ensure the driveway was not damaged during the construction period. 
  5. [512]
    The experts agree that the reasonable cost of rectification is $99.62 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 47 - Porcelain tiles in entry hall - $92.91[196] 

  1. [513]
    I find that the Builder is to pay Mr Gillham $88.87 (incl GST) in respect of this item.
  2. [514]
    The Builder accepts the experts’ evidence that the porcelain tiles in the entry hall were damaged by the Builder or its sub-trades while the work was being carried out on site and requires repair or replacement, and that the reasonable cost of rectification is $73.45 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 48 - Travertine tiles – ensuite 2 - $92.91[197]  

  1. [515]
    I find that the Builder is to pay Mr Gillham $88.87 (incl GST) in respect of this item.
  2. [516]
    The Builder accepts the experts’ evidence that the travertine tiles in ensuite 2 were damaged by the Builder or its sub-trades whilst the work was being carried out on site and require replacing, and that the reasonable cost of completion is $73.45 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 49 - Magnetic door stop - $23.68[198] 

  1. [517]
    I find that the Builder is to pay Mr Gillham $22.60 (incl GST) in respect of this item.
  2. [518]
    The Builder accepts the experts’ evidence that the magnetic door stop to the study supplied by the owner was not fitted by the Builder and is now missing, and that the reasonable cost of completion is $18.68 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 50 & 60 – Toilet seat to powder room - $73.48[199]

  1. [519]
    I find the Builder is to pay Mr Gillham $70.29 (incl GST) in respect of this item.
  2. [520]
    Mr Gillham’s and Mr Dixon’s evidence is that the new toilet seat in the powder room is badly scratched and requires replacement.  Mr Gillham claims it was damaged prior to his taking possession.  Mr Dixon’s evidence is that the toilet seat does not sit evenly over the toilet bowl as a result of poor installation requiring adjustment.  Mr Kernohan conceded in cross examination that he had not seen the toilet seat since it had been installed as part of the works under the Contract.  I accept that it is more likely than not that the Builder is responsible for rectifying the damage and for the failure to properly install the toilet seat.
  3. [521]
    The experts’ evidence is that the reasonable cost of rectification is $58.09 (excl builder’s margin and GST). I accept the experts’ evidence. For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 51 & 52 – Wastage of Tiles in powder room – surplus tiles removed - $228.48[200]

  1. [522]
    I find that the Builder is to pay Mr Gillham $228.48 (incl GST) in respect of this item.
  2. [523]
    Under the Contract Mr Gillham was responsible for supplying tiles for use by the Builder.  Mr Gillham was requested to supply additional tiles to allow the powder room to be completed.  The evidence is that these additional tiles cost $228.48 and that after the tiling was completed there were five full tiles left over, which were removed from site prior to Mr Gillham taking possession. 
  3. [524]
    The experts’ evidence is that the number of boxes of tiles Mr Gillham initially supplied ought to have been sufficient to tile the powder room allowing for a fair and reasonable twenty percent wastage. Mr Dixon’s evidence is that the industry standard is ten percent wastage and that on his calculation the actual wastage was more than 40%. 
  4. [525]
    Mr Kernohan’s oral evidence was that he attended site with the tiler to set the grout lines and that he wasn’t thinking about tile wastage but rather the ultimate look.  There is no evidence before me that the tiles supplied were defective causing a higher than usual wastage.  I accept that the tiler’s wastage rate was excessive and it is more likely than not that had reasonable skill and care been taken Mr Gillham would not have been required to purchase the additional tiles.  It is also more likely than not that the Builder or its sub-trades removed the left over five full tiles.

Scott schedule 53 – Roof trusses, lintels and roof sheets - $3,433.21[201]

  1. [526]
    I find the Builder is to pay Mr Gillham $500 in respect of this item.
  2. [527]
    Mr Gillham claims that whilst the Contract by special condition 9 provided that unfixed and demolished materials, with certain exceptions not including these items, were to be the Builder’s property the Contract was varied by email exchange on 11 May 2015.  The evidence is that prior to this exchange Mr Kernohan had permitted his carpenter to attempt to sell the roof trusses and a buyer had been located for an agreed price of $250.  It appears that Mr Gillham’s desire to retain the trusses had not been conveyed to the carpenter. 
  3. [528]
    Subsequently on 30 May 2015, Mr Gillham intercepted the buyer removing trusses and roof sheeting from site and that both Mr Gillham and the carpenter phoned Mr Kernohan in the course of the exchange with the buyer, with Mr Kernohan not disputing Mr Gillham’s ownership and delegating to the carpenter to resolve the matter. 
  4. [529]
    Mr Gillham’s evidence, which is supported by a contemporaneous email,[202] is that he agreed to accept $1,000 on the basis the Buyer and the carpenter would pay $500 each.  There is evidence before me that the buyer transferred $500 to Mr Gillham’s account shortly afterwards, having already paid $250 cash to the carpenter. [203] The carpenter did not give evidence in these proceedings.  I accept Mr Gillham’s evidence as to the agreement reached.  Mr Kernohan’s evidence was that he told the Builder’s carpenter not to pay Mr Gillham. 
  5. [530]
    I accept that in the circumstances the Builder is responsible for the unpaid balance of the agreement its carpenter made in the course of his employment.
  6. [531]
    Mr Gillham’s evidence, which is not challenged, is that the quantity of materials sold in this way was approximately one-third of the total.  He contended that the remaining two-thirds had been removed prior to 30 May 2015.  Mr Gillham seeks compensation as to the balance.  Mr Kernohan’s oral evidence was that he stockpiled and left on site some roofing and timber, which he acknowledged would have some salvage value which he estimated at a ‘couple of hundred bucks’.[204]
  7. [532]
    I am not satisfied that the remaining two-thirds of the materials were removed from site after the 11 May 2015 agreement to vary special condition 9 because there is little or no evidence on this point.  There is also some evidence that some of the demolished materials remained on site. 

Scott schedule 54 - Timber support posts - $1,316.14[205] 

  1. [533]
    I find that the Builder is to pay Mr Gillham $969.57 (incl GST) together with a refund of the amount paid in respect of variation 15 in respect of this item.
  2. [534]
    The Builder accepts Mr Dixon’s evidence that the timber support posts were incorrectly installed and require rectification. This requires a reversal of variation 15, previously paid by Mr Gillham in the amount of $302.50 because despite that work to shorten the posts they were still not short enough. The Builder accepts that the reasonable cost of rectification is $801.30 (excl builder’s margin and GST). I accept Mr Dixon’s evidence. For the reasons set out earlier, I find that a reasonable margin is 10%, being a total of $969.57 together with a refund of the amount paid in respect of variation 15.

Scott schedule 55 - Backfill soil – outside edge patio slab - $1,558.99[206] 

  1. [535]
    I find that the Builder is to pay Mr Gillham $302.50 (incl GST) in respect of this item.
  2. [536]
    The Builder accepts the experts’ evidence that it failed to provide backfilled soil along the outside edge of the patio slab and that the reasonable cost of completion is $250.00 (excl builder’s margin and GST). For the reasons set out earlier, I find that a reasonable margin is 10%. Mr Gillham seeks to rely upon the amount originally set out in Mr Dixon’s report. However, that evidence has been superseded by the evidence in the joint-report.  Even if it had not been superseded, having regard to the photograph in Mr Dixon’s report, I am not satisfied that the work required is extensive.[207]

Scott schedule 56 - Patio topping slab (north side patio) – saw cuts - $278.30[208] 

  1. [537]
    I find that the Builder is to pay Mr Gillham $266.20 (incl GST) in respect of this item.
  2. [538]
    The Builder accepts the experts’ evidence that it failed to perform saw cuts and that the reasonable cost of completion is $220.00 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 57 – windows - $9,066.20[209] or alternatively $6,046.78

  1. [539]
    I find the Builder is to pay Mr Gillham $6,046.78 (incl GST) in respect of this item.
  2. [540]
    Mr Gillham contends that the Builder incorrectly supplied 4 sash (or framed windows) in the dining room and family room and that the windows are in any event defective as they rub or ‘bind’ against each other when the windows are raised or lowered.  He seeks the cost of replacing them with alternative windows relying upon a quote obtained.[210]  Mr Dixon obtained an alternative quote in the amount of $6,046.78 (incl GST). [211]
  3. [541]
    Unlike the product Mr Gillham viewed at the supplier’s showroom the windows installed have an aluminium trim rather than a transparent glass rail across each pane of glass, which obstructs the view.  Mr Gillham produced a product brochure, which described sashless windows as being a frameless design which has two panels of glass which slide silently past each other with aluminium guides which fit into the perimeter frame.[212] There is no evidence before me that the product viewed at the showroom or shown in the brochure were double glazed windows.  There is no evidence before me that Mr Gillham provided a copy of the brochure to the Builder.  Mr Gillham’s evidence is that he sought and obtained an assurance from the supplier that the sashless windows could be manufactured in a double glazed format.   
  4. [542]
    There was a conflict of evidence between the experts and Mr Kernohan about the meaning of the term sashless.  The description in the brochure more closely aligns with Mr Kernohan’s evidence that the window is a frameless design. 
  5. [543]
    Mr Gillham’s evidence is that after the windows had been installed he took up the issue of the aluminium trim with the supplier by email dated 23 June 2015[213] and was informed that it was required for double glazed units.[214]  He also took up the issue of the claimed defect with the supplier by email dated 15 August 2015.[215]  The evidence is that the issue occurs when the window slides past fully open[216] and other than restricting the window panes from sliding past that point, which Mr Gillham contends is not suitable to him, there is no other method of rectification.[217]
  6. [544]
    Mr Kernohan’s evidence was that the windows as supplied meet the description in the Contract according to the supplier chosen by Mr Gillham.  Mr Gillham’s evidence was that if he had been aware that the windows could not be manufactured as demonstrated or as specified in the Contract, he would have chosen a different window. 
  7. [545]
    The evidence is that the Builder had a copy of Mr Gillham’s quote for the supply of windows, which could have been used to compare the goods supplied.   Unfortunately for the Builder, although Mr Gillham prevailed upon the Builder to include the supply of windows as part of the Contract for no additional margin, the Builder then took on obligations in respect of the windows.  The Contract provided in the window schedule, that the formal dining room windows were to be sashless, double hung, double glazed windows.[218]
  8. [546]
    Although most of the dealings were conducted directly between Mr Gillham and the supplier, the Builder had an obligation to supply the product as specified or seek instructions as to an alternative if such a product could not be supplied.  I prefer the evidence as to the reasonable costs of replacement windows obtained by the independent expert and with which Mr Carpenter agreed in the event the Tribunal decided that the windows required replacement.

Scott schedule 58 – privacy locks - $34.03[219] 

  1. [547]
    I find the Builder is to pay Mr Gillham $32.55 (incl GST) in respect of this item.
  2. [548]
    During the hearing Mr Kernohan conceded this item of incomplete work.  The experts’ evidence is that the reasonable cost of completion is $26.90 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 59 - Installed skirting to study - $36.04[220] 

  1. [549]
    I find that the Builder is to pay Mr Gillham $34.47 (incl GST) in respect of this item.
  2. [550]
    The Builder accepts the experts’ evidence that it installed skirting to the study in a defective or un-tradesman like manner, and that the reasonable cost of rectification is $28.49 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 61 - Shorten covered walkway - $854.84[221] 

  1. [551]
    I am not satisfied Mr Gillham has established his loss in any particular amount in respect of this item.
  2. [552]
    The evidence is that the covered walkway was not constructed as shown on the approved building drawings.  Mr Gillham seeks a credit adjustment to reflect the costs saved. 
  3. [553]
    The parties agree that during the course of the works at an onsite meeting Mr Kernohan explained to Mr Gillham the difficulties to marry the Colorbond walkway roof with the tiled house roof including that they were different materials and at different levels.  They agreed to construct the covered walkway so that it finished about a metre from the house roof.  Mr Kernohan points to the lack of detail as to how it was proposed to tie in the rooves in the Contract and contends that it could not be done or, if done, would be ‘ugly’.  His evidence was that by shortening the walk way roof additional work was required including cutting off the end bay of the pre-existing walkway at the same rake as the house and installing new rafters and fascias which lined up.  I accept his evidence that additional work was required. 
  4. [554]
    The experts agree that the reasonable cost to extend the walkway and interconnect the roof framing was $675.76 (excl builder’s margin and GST).  These costing do not factor into the credit any additional work required by the Builder to modify the pre-existing walkway to achieve the as constructed finish. [222]  I am not satisfied the amount claimed reflects the difference in cost between the work required by the Contract and the work undertaken.

Scott schedule 62 - Picture rail - $648.72[223] 

  1. [555]
    I find that the Builder is to pay Mr Gillham $620.51 (incl GST) in respect of this item.
  2. [556]
    The evidence is that Mr Gillham requested the deletion of the picture rail.  No formal variation was agreed and signed by the parties as to the appropriate credit adjustment to be allowed.
  3. [557]
    The Builder accepts the experts’ evidence in respect of deletion of picture rail and that the reasonable cost of completion is $512.82 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 64 - Install guttering to roof section north of formal lounge - $97.86[224] 

  1. [558]
    I find that the Builder is to pay Mr Gillham $93.61 (incl GST) in respect of this item.
  2. [559]
    The Builder accepts the experts’ evidence that it failed to correctly install guttering to the roof section that is situated north of the formal lounge so as to prevent surcharge during rain periods and that the reasonable costs of rectification is $77.36 (excl builder’s margin and GST). I accept the experts’ evidence.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Scott schedule 66 - Northern patio tiling - $4,743.94[225] 

  1. [560]
    I find that no amount is payable by the Builder to Mr Gillham in respect of this item.  In calculating the amount payable, the Contract price ought to be adjusted by the remaining provisional sum allowance of $8,684.50 (incl GST), which had not been claimed by the Builder.
  2. [561]
    The evidence is that:
    1. (a)
      the Northern patio tiling labour was part of a provisional sum item;
    2. (b)
      Mr Gillham was responsible for supplying the tiles;
    3. (c)
      the parties discussed deleting the Northern patio tiling work from the Contract because the tiles had not at that time been delivered and there was some doubt as to when they would be on site;
    4. (d)
      the Builder conditionally agreed to Mr Gillham’s offer to delete the works from the Contract if the tiles had not been delivered by Practical Completion but no formal variation was signed;
    5. (e)
      the work had not been performed prior to the Builder claiming Practical Completion because the tiles were not delivered to site until 3 August 2015 after the Builder claimed Practical Completion.  The Practical Completion claim did not claim the balance of the provisional sum for tiling labour, consistent with its agreed deletion;
    6. (f)
      the remaining allowance was $7,895 (excl GST) or $8,684.50 (incl GST), which was not invoiced by the Builder.
  3. [562]
    The parties accept the experts’ evidence that the cost to complete the work is $10,615.37 (excl builder’s margin and GST).  This is an amount in excess of the remaining allowance. 
  4. [563]
    Where the actual cost of the work for a provisional sum exceeds the amount allowed the Contract Price is to be increased by the excess amount plus the builder’s margin.[226] I am not satisfied that any credit in excess of the Provisional Sum allowance is required. In calculating the amount payable the Contract price ought to be adjusted by the remaining allowance.

Scott schedule 67 – keys - $801.35[227]

  1. [564]
    I find that the Builder is to pay Mr Gillham $801.35 in respect of this item.
  2. [565]
    The Builder conceded it retained some keys for the purpose of carrying out works to remedy defects and omissions. 
  3. [566]
    Mr Gillham put the Builder on notice a number of times of his intention to engage a locksmith if all keys were not returned and that he did not agree to the Builder retaining keys.  Mr Gillham obtained an estimate on 17 June 2016 in the sum of $801.35 to rekey the door and window locks.[228]
  4. [567]
    The Builder challenges the necessity for this work.  I accept Mr Gillham’s submission that the security of his house is compromised as he is in substantial dispute with the Builder, which retains keys.
  5. [568]
    The experts’ evidence is that the quoted cost is fair and reasonable.  I accept the experts’ evidence.

Scott schedule 68 – builder’s margin VA20 -$3,300 and VA22 - $1,100[229]

  1. [569]
    Mr Gillham’s claim has been dealt with earlier in these reasons.

Scott schedule 69 – variation 1 - $10,733.84[230]

  1. [570]
    Mr Gillham’s claim has been dealt with earlier in these reasons.

Scott schedule 70 - Reinstate pre-existing manholes – install second manhole - $302.93[231]

  1. [571]
    I find that the Builder is to pay Mr Gillham $190.37 (incl GST) in respect of this item.
  2. [572]
    Mr Gillham seeks reimbursement of the amount incurred.[232] The invoice indicates the contractor charged for 5.5 hours of labour which included ceiling inspections on two days.
  3. [573]
    The Builder accepts the experts’ evidence that it failed to reinstate pre-existing manholes to the ceiling and/or failed to install any manholes to the ceiling and that the reasonable cost of rectification is $157.33 (excl builder’s margin and GST). For the reasons set out earlier, I find that a reasonable margin is 10%. I prefer the independent experts’ evidence as to the reasonable costs of rectification, rather than the actual charge incurred by Mr Gillham as I am not satisfied that the  quote from a sole contractor, who did not give evidence in these proceedings, was necessarily the reasonable cost to perform the rectification work.

Scott schedule 71 – substitution of ornate cornice for plain cornice - $84.02[233]

  1. [574]
    Mr Gillham’s claim has been dealt with earlier in these reasons in relation to variation 14.

Scott schedule 72 – Downpipes and gutters - $518.40[234]

  1. [575]
    Mr Gillham’s claim has been dealt with earlier in these reasons in relation to variation 19.

Scott schedule 73 - Install safe - $220[235] 

  1. [576]
    I find that the Builder is to pay Mr Gillham $62.99 (incl GST) in respect of this item. 
  2. [577]
    Mr Gillham relies upon a quote for the supply and installation of safes.[236]  The quote is somewhat confusing as it sets out amounts for three safes and installation.  Mr Gillham submits that the logical interpretation is that the $220 refers to the installation of one safe and that it contemplates transportation of one safe to the site as well as installation.  I accept that it is more likely than not that the quote contemplates supply of one of the three safes quoted, delivery and installation.
  3. [578]
    Mr Kernohan’s oral evidence was that the Builder did not install a safe, which was part of the scope of works under the Contract, because Mr Gillham directed it not to do so and that a credit was due to Mr Gillham.  The scope of work under the Contract provided only for installation rather than delivery and installation as contemplated by the quote.
  4. [579]
    The Builder accepts the experts’ evidence that a reasonable cost of installation is $52.06 (excl builder’s margin and GST).  For the reasons set out earlier, I find that a reasonable margin is 10%. I prefer the independent experts’ evidence as to the reasonable costs of completion, rather than the quote from a sole contractor, who did not give evidence in these proceedings, relied upon by Mr Gillham as I am not satisfied that the quote was necessarily the reasonable cost to complete the work under the Contract and included other work not part of the Contract scope.

Scott schedule 74 – pest control - $440[237] 

  1. [580]
    I am not satisfied that restitution ought to be made.
  2. [581]
    Mr Gillham seeks restitution because the Builder was made aware that it would not incur expense in relation to replacing pavers as a result of an agreement between the subcontractor and Mr Gillham and the sum of $440 (incl GST) was reduced from the subcontractor’s claim to the Builder.
  3. [582]
    The Builder did not put into evidence any documents to contradict that its subcontractor had reduced its claim by the amount agreed between it and Mr Gillham.  I accept that it is more likely than not that the Builder received the credit.
  4. [583]
    The Contract provided that Mr Gillham must communicate and deal with the Builder and must not give directions to the Builder’s employees or subcontractors and is not entitled to rely upon statements or representations given by the Builder’s employees or subcontractors.[238] 
  5. [584]
    Mr Gillham seeks the benefit of a credit he negotiated directly with the Builder’s pest control subcontractor for a variation to the scope of works apparently in breach of the Contract.   I am not satisfied that Mr Gillham should benefit from his own wrong.

Scott schedule 75 – Level bedding along northern patio - $7,700[239]  

  1. [585]
    I find that no amount is payable by the Builder to Mr Gillham for this item.
  2. [586]
    Mr Gillham relies upon a single quote for work that is no longer required.[240]  The contractor providing the quote did not give evidence in this proceeding.
  3. [587]
    Mr Kernohan’s evidence was that the bedding, which was no longer required because a topping slab was installed, formed part of the tiling provisional sum.  Mr Gillham’s final submissions accept Mr Kernohan’s evidence.
  4. [588]
    Mr Gillham’s submissions appear to misconceive the nature of provisional sum allowance adjustments.
  5. [589]
    The experts’ evidence is that the accounting for the bedding would be part of the costs to complete the tiling.  They offered no separate amount for this item. 
  6. [590]
    The tiling provisional sum allowance has been fully exhausted by the tiling work claimed by the Builder and the costs to complete the northern patio as found earlier in these reasons.  If the bedding had been required to be performed the actual costs of the tiling work would have exceeded the provisional sum allowance by more than it has already been exceeded requiring an adjustment in the Builder’s favour.

Scott schedule 76 - FC gable – northwest corner of lanai - $71.85[241] 

  1. [591]
    I find that the Builder is to pay Mr Gillham $68.73 (incl GST) in respect of this item.
  2. [592]
    The Builder accepts the experts’ evidence that it installed the FC gable at the northwest corner of the lanai in an un-tradesman like manner requiring rectification, and that the reasonable cost of rectification is $56.80 (excl builder’s margin and GST). For the reasons set out earlier, I find that a reasonable margin is 10%.

Crack in bedroom 3 internal wall - $3,795[242] 

  1. [593]
    I find the Builder is to pay Mr Gillham $3,025 (incl GST) in respect of this item.
  2. [594]
    This item was raised a relatively short time before the hearing.  The experts and Mr Kernohan had not been to site to inspect this item.  Mr Gillham provided photographs of the crack.[243] 
  3. [595]
    During the experts’ concurrent evidence they agreed that the likely costs to rectify the crack based on the limited information they had before them was probably between $2,000 to $3,000 although depending upon a number of factors explained by Mr Dixon it may be less.  The Builder accepts the experts’ evidence. 
  4. [596]
    In view of the experts’ evidence as to rectification costs, I accept the mid way point of the estimate as the likely costs of rectification.  For the reasons set out earlier, I find that a reasonable margin is 10%.

Battery and cables for relocated generator - $190.25[244] 

  1. [597]
    I find the Builder is to pay Mr Gillham $190.25 in respect of this item.
  2. [598]
    Mr Gillham’s evidence is that the battery and terminals were removed from his generator by cutting the cables during the period when the Builder had control of the site and that he purchased replacements, which is supported by an invoice.[245]
  3. [599]
    Mr Kernohan accepted, during his oral evidence, that Mr Gillham’s generator was relocated as part of the Contract works.  He was unable to explain why the battery and terminals had been removed.
  4. [600]
    I accept that it is more likely than not that the failure to ensure the battery was attached to the relocated generator is incomplete work.  During the hearing Mr Harding conceded, on behalf of the Builder, that the amount claimed was fair and reasonable.

Are other amounts owing to Mr Gillham?

Electricity[246] 

  1. [601]
    I find the Builder is to pay Mr Gillham $414.73 in respect of this item.
  2. [602]
    Mr Gillham claims $414.73 for electricity use on the site from the start date to practical completion.[247]  The Builder was to reimburse on a pro-rata basis based on meter readings recorded at commencement and completion.
  3. [603]
    In his oral evidence Mr Kernohan conceded he had not re-imbursed Mr Gillham for electricity used.  His evidence was that prior to receipt of Mr Gillham’s statement filed 9 March 2017[248] he had not been provided with details of the electricity usage. There was no dispute as to the amount claimed.

Interest

  1. [604]
    I find the Builder is to pay Mr Gillham $9,810.71 interest calculated to 14 June 2019.
  2. [605]
    Mr Gillham claims interest on his claims at 10% per annum[249] from the date they became payable as follows:
    1. (a)
      from 10 June 2015 in respect of Items 1 to 67, 70, 73, 75, 76 and for electricity usages and the battery and cables for generator item;[250]
    2. (b)
      from 4 December 2015 on liquidated damages;
    3. (c)
      from 1 April 2016 on actual damages.
  1. [605]
    The claim for interest from 10 June 2015 appears to be made on the basis that it was the original Date for Practical Completion Stage under the Contract.  I am not satisfied that Mr Gillham’s damages became payable on the original Date for Practical Completion.  Mr Gillham’s damages are due for payment as a consequence of the determination of his damages claim by the Tribunal.  Unless there is evidence before me that he has expended money I am not satisfied that interest should accrue from an earlier time.  I accept that interest at 10% per annum is applicable.
  2. [606]
    There is evidence before me that Mr Gillham paid amounts in respect of the following Scott schedule items:
    1. (a)
      5 – Fondis unit - $3,659;
    2. (b)
      8 – Wine racks - $3,784;
    3. (c)
      49 – Door stop - $22.60;
    4. (d)
      51&52 – Tiles - $228.48;
    5. (e)
      70 – Manholes - $190.37;
    6. (f)
      Battery & cables - $190.25;
    7. (g)
      Electricity - $414.73.
  3. [607]
    Of these items, items to the value of $7,694.08 were paid for by Mr Gillham prior to the Builder claiming Practical Completion.[251]  These claims were detailed in the statement filed 27 June 2016.[252]   I am not satisfied that these amounts could be said to have been payable on 10 June 2015.  The submissions do not draw to my attention an earlier specific demand for payment for these items. In these circumstances, I find that interest accrues on and from 28 June 2016 at 10% per annum or $2.11 per day.  On my calculation interest is payable for a period of 1082 days to 14 June 2019 and that interest payable is $2,283.02.
  4. [608]
    The evidence is that Mr Gillham arranged for another contractor to install a second manhole on or about 6 May 2016. The claim was included in the statement filed 27 June 2016.[253]  I am not satisfied that this amount could be said to have been payable on 10 June 2015.  The submissions do not draw to my attention an earlier specific demand for payment for this item.  I find that interest accrues on $190.37 from on and from 28 June 2016 at 10% per annum or $0.05 per day.  On my calculation interest is payable for a period of 1082 days to 14 June 2019 and that interest payable is $54.10.
  5. [609]
    The evidence is that Mr Gillham arranged for a contractor to rectify the damage to the battery and generator on or about 25 January 2017. The claim was included in the statement filed 9 March 2017.[254] I am not satisfied that this amount could be said to have been payable on 10 June 2015.  The submissions do not draw to my attention an earlier specific demand for payment for this item.  I find that interest accrues on $190.25 from on and from 10 March 2017 at 10% per annum or $0.05 per day.  On my calculation interest is payable for a period of 827 days to 14 June 2019 and that interest payable is $41.35
  6. [610]
    The evidence is that Mr Gillham did not request payment of any amount for electricity until it was included in the statement filed 9 March 2017.[255]  I find that interest on $414.73 accrues on and from 10 March 2017 at 10% per annum or $0.11 per day.  On my calculation interest is payable for a period of 827 days to 14 June 2019 and that interest payable is $90.97.
  7. [611]
    I find interest accrues on the sum of $20,800 for liquidated damages payable at the time of Mr Gillham taking possession. Interest accrues from on and from 5 December 2015 at 10% per annum or $5.70 per day.  On my calculation interest is payable for a period of 1288 days to 14 June 2019 and that interest payable is $7,341.60.

Summary of claims allowed

  1. [606]
    The amount payable is calculated as follows:

Contract Price (incl GST)

 

$675,451.84

Less amount paid

Claim 1

Claim 2

Claim 3

Claim 4b

Claim 5

 

$ 44,939.07

$170,458.70

$ 46,803.73

$192,238.20

$133,973.25

 

 

 

 

 

$588,412.95

Sub –total

 

$  87,038.89

Plus Provisional Sum adjustments and agreed variations /amounts to be allowed in calculation of Mr Gillham’s damages

 

 

 

VA01

VA02

VA03

VA04

VA05

VA06

VA07

VA09

VA10

VA11

VA12

VA14

VA16

VA18

VA19

VA20

VA21

VA22

VA29

Provisional Sum – Tiling labour remaining unclaimed

Less variation amount to be refunded

$ 10,773.84

$  5,431.69

$    497.31

$  1,258.40

$  8,315.45

$    601.37

$    324.28

$  2,262.70

$  7,502.00

$  1,560.90

$    726.00

-

$    580.80

$    889.35

$    681.47

($33,000.00)

$    467.50

($11,000.00)

$  1,140.30

($ 8,684.50)

 

($   302.50)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

($   8,715.24)

Sub-total

 

  $78,323.65

Less damages including costs of rectification of defective and incomplete work

 

 

Scott schedule 2

Scott schedule 3

Scott schedule 4

Scott schedule 5

Scott schedule 6

Scott schedule 7

Scott schedule 8

Scott schedule 10

Scott schedule 11 & 20

Scott schedule 12

Scott schedule 13

Scott schedule 14

Scott schedule 15

Scott schedule 16

Scott schedule 17 & 18

Scott schedule 19

Scott schedule 21

Scott schedule 23

Scott schedule 25

Scott schedule 26

Scott schedule 27

Scott schedule 28

Scott schedule 29

Scott schedule 32

Scott schedule 33

Scott schedule 34

Scott schedule 35

Scott schedule 36

Scott schedule 37

Scott schedule 40

Scott schedule 41

Scott schedule 42

Scott schedule 43

Scott schedule 46

Scott schedule 47

Scott schedule 48

Scott schedule 49

Scott schedule 50 & 60

Scott schedule 51 & 52

Scott schedule 53

Scott schedule 54

Scott schedule 55

Scott schedule 56

Scott schedule 57

Scott schedule 58

Scott schedule 59

Scott schedule 62

Scott schedule 64

Scott schedule 67

Scott schedule 70

Scott schedule 73

Scott schedule 76

Crack

Battery/cables

$  2,223.88

$  1,998.58

$    457.97

$  3,659.00

$    694.46

$    448.67

$  3,784.00

$  1,524.60

$    176.64

$    620.49

$     16.27

$     23.23

$    338.07

$    532.40

$    387.74

$    605.00

$    131.00

$      21.53

$    977.20

$     82.12

$    187.21

$    970.08

$  2,057.00

$    646.79

$      58.13

$  1,018.28

$    602.99

$    363.00

$    390.59

$  2,163.25

$  1,049.19

$    222.62

$    434.93

$    102.54

$     88.87

$     88.87

$     22.60

$     70.29

$    228.48

$   500.00

$   969.57

$   302.50

$   266.20

$ 6,046.78

$      32.55

$      34.47

$    620.51

$      93.61

$     801.35

$     190.37

$       62.99

$       68.73

$   3,025.00

$     190.25

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$ 42,673.44

Sub-total

 

$ 35,650.21

Less other amounts owing under the Contract  Electricity

 

 

$     414.73

Sub-total

 

$ 35,235.48

Less Liquidated damages

 

$ 20,800.00

Sub-total

 

$ 14,435.48

Plus interest owing on Builder’s claims

 

$   8,122.79                                                            

Sub-total

 

$ 22,558.27

Less interest owing on Mr Gillham’s claims

 

 

$  9,810.71

Amount owing to the Builder

 

$ 12,747.56

Footnotes

[1]  [2018] QCATA 196.

[2]  Exhibit 1, filed 11 November 2015.

[3]  Item 19 of the Contract schedule provided interest was payable by Mr Gillham to the Builder on amounts overdue at the rate of 5% per annum.

[4]  Mr Gillham’s outline of submissions filed 5 May 2017 consisted of 139 pages.  The Builder’s submissions in response filed 9 June 2017 consisted of 25 pages.  Mr Gillham’s submissions in response filed 22 June 2017 consisted of a further 23 pages.

[5]  Contract, General Condition cls 17.7.

[6]Queensland Building and Construction Commission and Other Legislation Amendment Act 2014 (Qld), s 62.

[7]  DBC Act, s 8.

[8]  Ibid s 9, sch 2 (definition of ‘regulated amount’).

[9]  Ibid, s 3.

[10]  Contract, sch, item 16, General Condition cls 29.9 – 29.13.

[11]  Invoice 3186.  Amended invoice emailed 28 March 2015.  I accept that the invoice was adjusted after review by the Project Manager and Mr Gillham as contemplated by the Contract.

[12]  Invoice 3196, emailed 20 April 2015.

[13]  Invoice 3203, emailed 13 May 2015.

[14]  Forms part of Exhibit 8.  All amounts GST inclusive.

[15]  Invoice 3205b, emailed 30 May 2015.

[16]  It also noted that variation 5 in respect of render in the sum of $7,559.50 (excl GST) was 0% completed.

[17]  Exhibit 3, DSK 14.

[18]  Exhibit 15, ANWG10, Contract sch, item 5, General Condition cl 11.9.

[19]  Contract, General Condition cl 11.8.

[20]  Ibid, cls 11.8, 18.2.

[21]  Ibid, cl 3.2.

[22]  Ibid, cl 28.1.

[23]  Application filed 24 June 2015.

[24]  Contract, General Condition cl 29.10.

[25]  Exhibit 3, DSK 11, page 163.

[26]  Taking into account the public holiday on 8 June 2015.

[27]  There is evidence before me that Mr Hermon and Mr Gillham also fell into dispute during the course of the Contract. 

[28]  Exhibit 15, ANWG 19, page 204.

[29]  Exhibit 25, pages 6 and 7 of 14.

[30]  Exhibit 15, ANWG 19, page 204.

[31]  Ibid, ANWG 10, page 171.

[32]  Forms part of Exhibit 20.

[33]  Invoice 3214.

[34]  Variation amounts GST exclusive.

[35]  Scott schedule 3.

[36]  Scott schedule 27.

[37]  Forms part of Exhibit 20, letter dated 29 June 2015.

[38]  Contract, General Condition, cl 11.7, sch, item 20.

[39]  Exhibit 19 and Exhibit 22.

[40]  Exhibit 3, DSK13, page 285.

[41]  Exhibit 15, ANWG118.

[42]  Submissions filed 5 May 2017, [192].

[43]  Scott schedule 10.

[44]  Scott schedule 4.

[45]  Scott schedule items 35, 36 and 57.

[46]  Total for variations except VA20 and VA22 being $40,552.64 (excl GST) or $44,607.90 (incl GST) plus $4,400 for builder’s margin (incl GST) for VA20 and VA 22 equates to $49,007.90 plus $11,618.14 ($6,016.77 plus 10% margin plus GST) in respect of soffits. 

[47]  Also required by General Condition cl 12.3.

[48]  Also required by General Condition cl 12.4(a).

[49]  Also required by General Condition cl 12.4(b).

[50]  Also required by General Condition cl 12.4(c).

[51]  Also required by General Condition cl 12.4(d).

[52]  Also required by General Condition cl 12.4(e).

[53]  [2018] QCATA 196.

[54]  Ibid, [78].

[55]  Ibid, [79] (emphasis in original).

[56]  Ibid, [68].

[57]  DBC Act, s 18(6).

[58]  [2018] QCATA 196, [102].

[59]  Ibid, [52] - [53] (citations omitted).

[60]  Contract, General Condition cl 1.

[61]  Ibid, cl 3.2.

[62]  Extension of Time #02 emailed 22 April 2015.

[63]  Ibid.

[64]  Contract, General Condition cl 12.4.

[65]  Accountant.

[66]  DBC Act, s 80(2)(g), s 81(2).

[67]  Ibid, s 79.

[68]  Ibid, s 80(2)(g), s 81(2).

[69]  Exhibit 3, part of DSK 13, page 221.

[70]  DBC Act, s 80(2)(g), s 81(2).

[71]  Contract, Appendix B.

[72]  Exhibit 15, ANWG16.

[73]  DBC Act, s 80(2)(g), s 81(2).

[74]  Ibid.

[75]  Ibid.

[76]  Ibid.

[77]  Ibid.

[78]  Ibid.

[79]  Ibid.

[80]  Ibid.

[81]  Ibid.

[82]  Ibid.

[83]  $1,177.33 less $495.86.

[84]  DBC Act, s 80(2)(g), s 81(2).

[85]  Ibid.

[86]  Ibid.

[87]  Filed 9 June 2017.

[88]Salam v Henley Properties (Qld) Pty Ltd [2015] QCATA 118.

[89]  (2009) 239 CLR 175.

[90]Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 3(b).

[91]  Ibid s 28(3)(a).

[92]Ryan v Worthington Simmons [2014] QCATA 277, [9]; Airstrike Industrial Pty Ltd v Robertson [2014] QCATA 209.

[93]  Contract, General Condition cl 1.

[94]Sumpter v Hedges [1898] 1 QB 673; Fraser v The Irish Restaurant & Bar Company Pty Ltd [2008] QCA 270.

[95]  Of those 31 items, in the order of 14 items are for amounts less than $100.

[96]  DBC Act, s 92.

[97]  Exhibit 12.

[98]  Ibid.

[99]  Exhibit 13.

[100]  Ibid.

[101]  Exhibit 12.

[102]  Ibid.

[103]  Exhibit 13.

[104]  Exhibit 12.

[105]  Ibid.

[106]  Exhibit 13.

[107]  Contract, General Condition cl 16.1.

[108]  Ibid, cl 16.2.

[109]  Ibid, cl 1.

[110]  Ibid, cl 18.1, sch, item 18.

[111]  Filed by leave at the commencement of the second day of the hearing.

[112]  168 days from 19 June 2015 to 4 December 2015.

[113]  Damien J Cremean et al (LexisNexis, 5th ed, 2013) [6.10].

[114]  [2016] QCA 119. 

[115]  Exhibit 24 at para 7.3.10.

[116]  Based on the retain and rent scenario.

[117]  Exhibit 24, schedule 3.

[118]  Ibid, schedule 3 and Appendix 3, page 6.

[119]  Ibid, schedule 4.

[120]  Ibid, schedule 4.

[121]  Ibid.

[122]  $22,774 less $801 for new locks, claimed separately.

[123]  Exhibit 24, Appendix 7.

[124]  Ibid, Appendix 8.

[125]  Rates at $814, upkeep of gardens and grounds at $2,950 and property insurance at $1,066.

[126]  Upkeep of gardens and grounds at $4,960, holding costs at $11,678 and NBN costs at $506.

[127]  $23,308 less $801 for locks.

[128]  Exhibit 24, Appendix 3, page 6.

[129]  Transcript (17 March 2017), 4-37.42 to 4-37.43.

[130]  Contract, General Conditions, cl 10.1(a).

[131]  DBC Act, s 44, s 45.

[132]  Exhibit 12.

[133]Bellgrove v Eldridge (1954) 90 CLR 613; Tabcorp Holdings Limited v Bowen Investments Pty Ltd (2009) 236 CLR 272.

[134]  Exhibit 18, ANWG08.

[135]  Respondent’s Outline of Submissions filed 5 May 2017, page 80.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[136]  Exhibit 12.

[137]  Respondent’s Outline of Submissions filed 5 May 2017, page 80. 

[138]  Exhibit 3, DSK13, p252.

[139]  Exhibit 15, ANWG 10, p178.

[140]  Ibid, ANWG 38.

[141]  Ibid, ANWG 39.

[142]  Ibid, ANWG 10, p121.

[143]  Ibid, ANWG 10, p126.

[144]  Ibid, ANWG 10, p164.

[145]  Ibid, ANWG 41.

[146]  Exhibit 3, DSK 13, p283.

[147]  Respondent’s Outline of Submissions filed 5 May 2017, page 80.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[148]  Ibid.

[149]  Exhibit 15, ANWG 10, p126.

[150]  Ibid, ANWG 10, p164.

[151]  Ibid, ANWG 47.

[152]  Ibid, ANWG 41.

[153]  Exhibit 3, DSK 13, p283.

[154]  Respondent’s Outline of Submissions filed 5 May 2017, page 80.  Amount includes the Joint Expert Report’s amount of $5,928 as provided by Mr Dixon plus 15% builder’s margin and GST.

[155]  Respondent’s Outline of Submissions filed 5 May 2017, page 80.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[156]  Respondent’s Outline of Submissions filed 5 May 2017, page 81.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[157]  Ibid.

[158]  Ibid.

[159]  Ibid.

[160]  Ibid.

[161]  Ibid.

[162]  Ibid.

[163]  Ibid.

[164]  Respondent’s Outline of Submissions filed 5 May 2017, page 82.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[165]  Ibid.

[166]  Ibid.

[167]  Ibid.

[168]  Ibid.

[169]  Exhibit 15, ANWG 53.

[170]  Respondent’s Outline of Submissions filed 5 May 2017, page 82.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[171]  Ibid.

[172]  Ibid.

[173]  Ibid.

[174]  Ibid.

[175]  Exhibit 15, ANWG54, ANWG78.  There are two copies of the same quote attached to Mr Gillham’s statement.

[176]  Respondent’s Outline of Submissions filed 5 May 2017, page 83.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[177]  Exhibit 15, ANWG 55.

[178]  Respondent’s Outline of Submissions filed 5 May 2017, page 83.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[179]  Respondent’s Outline of Submissions filed 5 May 2017, page 100.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[180]  Exhibit 15, ANWG59.  A copy is also attached to Exhibit 21

[181]  Ibid, ANWG59A.

[182]  Ibid, ANWG 10, page 56.

[183]  Ibid, ANWG 10, page 132.

[184]  Exhibit 13, page 78.

[185]  Respondent’s Outline of Submissions filed 5 May 2017, page 100.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[186]  Exhibit 15, ANWG 60.

[187]  Respondent’s Outline of Submissions filed 5 May 2017, page 100.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[188]  Respondent’s Outline of Submissions filed 5 May 2017, page 83.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[189]  Ibid.

[190]  Ibid.

[191]  Respondent’s Outline of Submissions filed 5 May 2017, page 100.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[192]  Ibid.

[193]  Exhibit 15, ANWG 63.

[194]  Exhibit 13.

[195]  Respondent’s Outline of Submissions filed 5 May 2017, page 100.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[196]  Respondent’s Outline of Submissions filed 5 May 2017, page 83.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[197]  Ibid.

[198]  Ibid.

[199]  Respondent’s Outline of Submissions filed 5 May 2017, page 100.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[200]  Respondent’s Outline of Submissions filed 5 May 2017, page 100 and 101.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[201]  Respondent’s Outline of Submissions filed 5 May 2017, page 101.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[202]  Exhibit 15, ANWG68.

[203]  Ibid, ANWG69.

[204]  Transcript (13 March 2017), 1-81.32.

[205]  Respondent’s Outline of Submissions filed 5 May 2017, page 83.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[206]  Respondent’s Outline of Submissions filed 5 May 2017, page 84.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[207]  Exhibit 13, page 101.

[208]  Respondent’s Outline of Submissions filed 5 May 2017, page 84.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[209]  Respondent’s Outline of Submissions filed 5 May 2017, page 101.  Amount in accordance with quote at Exhibit 16, ANWG129.

[210]  Exhibit 16, ANWG 129.

[211]  Exhibit 14, DD2, Attachment Supp#2-A.

[212]  Exhibit 15, ANWG73, page 371.

[213]  Ibid, ANWG 74.

[214]  Ibid, ANWG 75.

[215]  Ibid, ANWG 76.

[216]  Due to the presence of the aluminum trims.

[217]  Exhibit 15, ANWG 77.

[218]  Ibid, ANWG10, page 131 showing W03.

[219]  Respondent’s Outline of Submissions filed 5 May 2017, page 96.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[220]  Ibid.

[221]  Respondent’s Outline of Submissions filed 5 May 2017, page 101.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[222]  Exhibit 13, page 162.

[223]  Respondent’s Outline of Submissions filed 5 May 2017, page 84.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[224]  Ibid.

[225]  Respondent’s Outline of Submissions filed 5 May 2017, page 84.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST less unclaimed provisional sum for tiling $8,684.50 (incl GST).

[226]  Contract, General Conditions, cl 9.5.

[227]  Respondent’s Outline of Submissions filed 5 May 2017, page 101.

[228]  Exhibit 15, ANWG107.

[229]  Respondent’s Outline of Submissions filed 5 May 2017, page 101. 

[230]  Ibid.

[231]  Respondent’s Outline of Submissions filed 5 May 2017, page 84. 

[232]  Exhibit 15, ANWG 112.

[233]  Respondent’s Outline of Submissions filed 5 May 2017, page 102.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[234]  Respondent’s Outline of Submissions filed 5 May 2017, page 102.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[235]  Respondent’s Outline of Submissions filed 5 May 2017, page 84. 

[236]  Exhibit 16, ANWG 127.

[237]  Respondent’s Outline of Submissions filed 5 May 2017, page 102. 

[238]  Contract, General Condition cl 11.13.

[239]  Respondent’s Outline of Submissions filed 5 May 2017, page 97.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[240]  Exhibit 16, ANWG 128.

[241]  Respondent’s Outline of Submissions filed 5 May 2017, page 85.  Amount includes the Joint Expert Report’s agreed amount plus 15% builder’s margin and GST.

[242]  Ibid.

[243]  Exhibit 17, AMWG01.

[244]  Respondent’s Outline of Submissions filed 5 May 2017, page 102.

[245]  Exhibit 17, ANWG03.

[246]  Respondent’s Outline of Submissions filed 5 May 2017, page 97.

[247]  Special Condition SC12.

[248]  Exhibit 17.

[249]Queensland Building and Construction Commission Regulation 2003 (Qld), section 34B.

[250]  As found in Table 4 of Mr Gillham’s written submissions filed 05 May 2017.

[251]  Scott schedule items 5, 8, 49, 51, 52.

[252]  Exhibit 15.

[253]  Exhibit 15.

[254]  Exhibit 17

[255]  Ibid.

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Editorial Notes

  • Published Case Name:

    Kernohan Construction Pty Ltd v Austin Gillham

  • Shortened Case Name:

    Kernohan Construction Pty Ltd v Gillham

  • MNC:

    [2019] QCAT 165

  • Court:

    QCAT

  • Judge(s):

    Member Deane

  • Date:

    14 Jun 2019

Appeal Status

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