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- Unreported Judgment
QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL
Stewart v Scott trading as Fantasy Pools Brisbane  QCAT 110
LUPTON SCOTT TRADING AS FANTASY POOLS Brisbane
10 March 2020
17 September 2019; 7 November 2019
ORDERS & DIRECTIONS:
CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – PERFORMANCE OF WORK – REMEDIES FOR BREACH OF CONTRACT – DAMAGES – MEASURE OF – where swimming pool built – where contractual relations broke down – whether domestic building work – whether defects can be repaired – whether demolition and replacement necessary – whether payment on quantum meruit basis appropriate – whether damages for stress claimable – whether solatium appropriate
Queensland Building and Construction Commission Act 1991 (Qld), s 77
Archibald v Powlett  VSCA 259
Bellgrove v Eldridge (1954) 90 CLR 613
Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221
REASONS FOR DECISION
- This case involves a dispute about a concrete-shell swimming pool built by the respondent, Mr Scott, at the home of the applicant, Mr Stewart. Litigation in the Tribunal over the matter has had a circuitous history. Mr Scott initially brought a minor civil dispute claim for payment of invoices, but that was dismissed on jurisdictional grounds. Then Mr Stewart commenced a claim for damages in the minor civil dispute jurisdiction. Mr Scott filed a counter-application for payment of invoices. The matter was transferred to the building list to become the present matter.
- In a nutshell, Mr Stewart contends that the work done by Mr Scott was defective, to the extent that the pool needs to be demolished and replaced. He seeks damages for the cost of doing that. He also seeks damages for other losses that he says Mr Scott caused. Mr Scott’s position is that any defects are only minor, and in any event he is not liable to fix them because of a deeming clause in the construction contract. He seeks payment on outstanding invoices plus interest.
- The matter was heard over two days: 17 September 2019 and 7 November 2019. Mr Stewart appeared for himself. Mr Adames, solicitor of All Building Law, appeared for Mr Scott. The documents before the Tribunal included the application and counter-application. There was a statement by Mr Stewart dated 22 May 2019 and a statement by Mr Scott dated 5 July 2019. There was also a statement by Mr Stewart, filed on 15 July 2019, commenting on Mr Scott’s statement. Attached to statements, or otherwise filed, were various photographs, audio files, and documents. These included the contract and a report of Manfred Wiesemes dated 26 February 2018. Mr Wiesemes is a pool builder who was engaged by Mr Stewart as an expert witness. Mr Stewart provided statements from his father Don Stewart, and from friends or neighbours Carlos Di Muro, Sean Connolly, Haydon Rixon, Tyronne Rex, and Robert Bullock. Mr Scott provided a statement from his steel fixer, Ben Norris. The Tribunal also received documents in the course of the hearing, and these were marked Exhibits 1 to 12.
- Oral evidence was given by Mr Stewart, Mr Scott, Mr Wiesemes, and two structural engineers namely Mark O’Hagan and George Frame. There was also oral evidence by witnesses for Mr Stewart, namely a builder Ben Eisenhut, Don Stewart, Mr Di Muro, Mr Rex and Mr Bullock. Written closing submissions dated 13 January 2020 were received from Mr Adames for Mr Scott. Written closing submissions in reply were received from Mr Stewart on 21 February 2020.
- Neither party contested jurisdiction, but it is still necessary to consider whether the Tribunal has jurisdiction.
- The Tribunal has jurisdiction to decide a ‘building dispute’: section 77(1) of the Queensland Building and Construction Commission Act 1991 (Qld) (‘QBCC Act’). Whether the dispute here is a building dispute as defined depends, through a chain of definitions, on whether it is ‘domestic building work’ as defined in section 4 of Schedule 1B of the QBCC Act:
4 Meaning of domestic building work
- (1)Each of the following is domestic building work—
- (a)the erection or construction of a detached dwelling;
- (b)the renovation, alteration, extension, improvement or repair of a home;
- (c)removal or resiting work for a detached dwelling;
- (d)the installation of a kit home at a building site.
- (3)Domestic building work includes—
- (a)work (associated work) associated with the erection, construction, removal or resiting of a detached dwelling; and
- (b)work (associated work) associated with the renovation, alteration, extension, improvement or repair of a home.
- (4)Without limiting subsection (3), associated work includes—
- (a)landscaping; and
- (b)paving; and
- (c)the erection or construction of a building or fixture associated with the detached dwelling or home.
Examples of buildings and fixtures—
retaining structures, driveways, fencing, garages, carports, workshops, swimming pools and spas
- (9)In this section—
- (a)a reference to a detached dwelling includes a reference to any part of a detached dwelling; and
- (b)a reference to a home includes a reference to any part of a home; and
- (c)a reference to site work includes a reference to work required to be carried out to gain access, or to remove impediments to access, to a site.
- ‘Home’ is defined in section 9(1) of Schedule 1B to the QBCC Act as, relevantly, ‘a building or portion of a building that is designed, constructed or adapted for use as a residence’.
- On one reading of section 4 of Schedule 1B, the construction of a pool would be captured as ‘domestic building work’ only if it was done together with other work on the home itself, such as the construction or renovation of the home. The pool work would then be ‘associated’ with the work on the home. On another reading, the construction of a pool without any other work on site could be regarded as ‘associated’ with the improvement of a home in the sense that the installation of a pool itself constitutes an improvement of the home by the addition of a fixture.
- Section 4 of Schedule 1B appears to be intended to capture a broad range of work within the domestic sphere. In light of that, I consider that the latter of the two readings should be preferred as it best achieves the purpose of the Act. Accordingly, even though the construction of the pool in the present case was not done in conjunction with work on Mr Stewart’s house, I am satisfied that it was domestic building work. Therefore the Tribunal has jurisdiction.
- Schedule 1B of the QBCC Act implies warranties into contracts for domestic building work, such as a warranty by the builder that the work will be carried out with reasonable care and skill. The contract in the present case also included warranties that reflect the statutory warranties.
- The pool is in Mr Stewart’s back yard. The back yard slopes downwards away from the house. The pool is rectangular, with the longer side running parallel to the back fence. The external walls of the pool are increasingly above-ground, because of the slope. The rear wall is fully above-ground. A timber deck has been built around the sides of the pool other than the side closest to the back fence. The deck was built by another firm after the pool was built.
- The pool construction contract was signed on 17 July 2017. The contract price was $38,500. Construction began on 11 October 2017. The pool shell was pneumatically sprayed over reinforcing steel. The pool was filled with water on or soon after 29 December 2017. Since about 1 January 2018, it has been used by Mr Stewart and his family, and by guests using the Airbnb apartment beneath Mr Stewart’s home.
- Mr Scott’s sales consultant Fred Bobardt carried out the pre-contractual negotiations on Mr Scott’s behalf. Mr Bobardt also signed the contract on Mr Scott’s behalf. Mr Bobardt has since died, so there is no evidence from him. Mr Stewart and Mr Scott first met on 11 October 2017, when construction began.
- Relations between Mr Stewart and Mr Scott deteriorated as work progressed. This reached a point where, in late December 2017, Mr Stewart engaged another firm to complete part of the construction work. He also refused to pay a number of the later invoices. Mr Stewart says he asked Mr Scott a number of times to rectify defects, but Mr Scott refused. There is no evidence of either party formally terminating the contract. However, a stalemate was reached, with Mr Scott refusing to continue performing under the contract – such as remedying defects – until Mr Stewart paid the invoices.
- In the course of construction, the original engineering designs were amended to include piers, which are additional foundational supports. The original design plans were given building approval on 21 August 2017. The amended design plans were given building approval on 29 May 2018.
Summary of claims and counter-claims
- The amount claimed as damages by Mr Stewart has grown considerably in the course of the proceeding. It was initially $24,186, as at the date of application on 11 June 2018. In a list tendered by Mr Stewart on 7 September 2019, he quantified his claim at $272,176. He arrived at this figure by adding up amounts for various particular types of loss, totalling $136,088, and then adding the same amount as a claim for stress.
- An updated list tendered on 7 November 2019 showed a total of $518,874 plus demolition costs which were yet to be quantified. Again, this total was arrived at by adding up amounts for various particular types of loss totalling $259,437, and then adding the same amount as the updated claim for stress. After preparing the list, Mr Stewart obtained a demolition quotation from Phoenix Cutting Solutions for $44,000.
- The breakdown of the updated list of costs or losses is as follows:
- (a)demolition of the pool: $44,000;
- (b)building a replacement pool: $87,261 (being the average between two quotations);
- (c)‘payments made’ to Mr Scott under the contract: $25,000;
- (d)‘replacement deck and retaining’: $41,574;
- (e)‘landscape back yard’: $5,000;
- (f)re-turfing of back yard: $1,617;
- (g)‘landscaping side’: $13,500;
- (h)plumbing: $858;
- (i)painting: $600;
- (j)lost income: $41,160;
- (k)delay costs: $20,425;
- (l)storage: $20,056;
- (m)pool report by Mr Wiesemes: $960;
- (n)printing: $700;
- (o)Auscript: $300;
- (p)‘Court cost’ (application filing fee): $326;
- (q)‘CD & Audio Copies’: $100; and
- (r)stress: $259,437.
- Mr Scott in his counter-application seeks dismissal of Mr Stewart’s claims, and orders for Mr Stewart to pay:
- (a)$10,755 on progress claim invoices, plus interest under the contract; and
- (b)$7,703.52 on a variation invoice, plus interest under the contract.
Further background matters
- Before addressing the particular claims in detail, some further background matters must be discussed.
Representations made by Fred Bobardt
- Parts of Mr Stewart’s claim proceed on the basis that he was entitled to the benefit of pre-contractual assurances that he says were made by the sales consultant, Mr Bobardt: for example, that an overflow pipe would be installed in the pool, and that a wooden ramp would be built to prevent damage to the side pathway stairs during construction. Mr Stewart also relies on leaflets provided by Mr Bobardt about filtration equipment, and notes that Mr Bobardt jotted on quotations.
- However, the contract contains a clause in which the parties acknowledge that the terms of the contract are set out fully in the contract, unaffected by any prior representations. Accordingly, earlier representations made by Mr Bobardt are not relevant in determining the parties’ rights.
Interior lining of the pool
- Under the contract, Mr Scott was to apply an ‘interior finish’, specified as ‘ultra fine “ebony and ivory”’. This was part of stage 5 of the contract: ‘completion of the internal lining and initial chemical treatment’. The price stated in the contract for stage 5 was $4,775. Interior finishing is sometimes referred to in the evidence as pebbling.
- The interior finishing was in fact carried out by Galaxy Pool Interiors (‘Galaxy’). Galaxy was engaged by Mr Stewart rather than by Mr Scott. Mr Stewart paid Galaxy for its work.
- Mr Stewart’s version of Galaxy’s involvement may be summarised as follows. Mr Scott said there would be difficulty finding a pebble applicator over the Christmas period. Mr Stewart was anxious to have the project completed, as there had already been several delays. Mr Stewart contacted Galaxy and it agreed to do the job before New Year’s Eve. Mr Scott approved Galaxy doing the work. Galaxy carried out the work while Mr Scott was present.
- Mr Stewart submits that, in these circumstances, Mr Scott is responsible for defects in the work carried out by Galaxy.
- Mr Scott’s version is somewhat different. It may be summarised as follows. The interior lining had to wait until Mr Stewart had a compliant fence. Under the contract, it was Mr Stewart’s responsibility to install the fence and obtain certification for it. By the time Mr Stewart advised that a certifier had approved the fence, it was nearly Christmas. Mr Scott was not able to engage a pebble applicator as soon as Mr Stewart wanted. Mr Stewart arranged for Galaxy to do the work. Mr Stewart and Mr Scott communicated about the arrangement but did not ultimately finalise an agreement about it.
- Mr Scott submits that he is not responsible for any defects in Galaxy’s work because Galaxy was engaged directly by Mr Stewart.
- Text messages between Mr Stewart and Mr Scott on 20 December 2017 are in evidence. Mr Stewart informed Mr Scott that he had booked Galaxy for a particular time and date. Mr Scott asked Mr Stewart how much Galaxy was going to charge him. Mr Stewart replied: ‘$2,700’. Mr Scott responded: ‘All good Cheers’.
- There is also an email sent later than afternoon from Mr Scott to Mr Stewart:
… Due to you sourcing your own pebble applicator we are providing you with a credit of $2,700.00 any dealings outside of your contract with outside contractors will be your responsibility and Fantasy Pools Brisbane will have no obligation to the works that they will carry out.
Upon the day your pool being [pebbled] we will provide you with an invoice Stage 5 which will [be] $2,075.
Please respond in a form of acceptance.
Thank you …
- Mr Stewart did not respond.
- Mr Scott attended the site when Galaxy was doing the work. Mr Scott maintains that he went merely to see what was happening.
- The invoice that Mr Scott issued for stage 5 was $2,075.
- I note that the contract provides a detailed mechanism in clause 12 for variation, to allow work to be added or omitted. The parties did not follow that procedure. Instead, Mr Stewart decided to engage Galaxy to carry out the interior lining. Mr Scott acquiesced in that course. However, at no point did Mr Scott treat the work as being done under his contract with Mr Stewart, or undertake to assume liability for any defects in the work carried out by Galaxy.
- I find that Galaxy carried out the interior lining work because it was directly engaged by Mr Stewart. Galaxy did not carry out the work on Mr Scott’s behalf. Galaxy was not Mr Scott’s agent or subcontractor. The work was not done under the contract between Mr Stewart and Mr Scott. There is therefore no basis upon which Mr Scott can be held liable for any defects in Galaxy’s work.
Whether a deemed practical completion and no-defect provision applies
- Mr Scott points to certain clauses in the contract which he says serve to absolve him of responsibility for defects, because of Mr Stewart’s conduct. One clause is to the effect that Mr Stewart could not take possession of ‘the works’ prior to making full payment, without Mr Scott’s prior written permission. The other is to the effect that if Mr Stewart took possession when not entitled to do so under the contract, the works were deemed to have reached practical completion without any defects or omissions on the day Mr Stewart took possession.
- Mr Scott submits that Mr Stewart took possession of the works by engaging Galaxy without his consent, and this triggered the deeming provision.
- I do not accept this. Mr Scott, with his ‘All good Cheers’ text, gave permission for Mr Stewart to engage Galaxy.
Whether Mr Scott provided a misleading printout of his building licence
- Mr Stewart contends that Mr Scott deliberately provided an out-of-date printout of his building licence as an attachment to his statement. Mr Stewart observes that the printout does not show the creation date and does not show a demerit entry which would have appeared on a current printout. Mr Scott denies any deception, saying that he had not generated the printout.
- I consider it unlikely that Mr Scott deliberately provided an out-of-date printout.
Conduct of Mr Scott’s workers
- Mr Stewart advanced quite a lot of written evidence from himself and from his father, neighbours and friends about the conduct of Mr Scott’s workers. Several of these witnesses also attended the hearing and gave oral evidence. The evidence concerned matters such as drinking alcohol, smoking marijuana, swearing, bringing children on to the site, failing to wear safety clothing, and failing to display danger signage at the front of the property. One witness, Tyronne Rex, described in his statement ‘the mass consumption of alcohol’ and ‘employees drunk by 11am’. Another witness, Robert Bullock, lived nearby. He said in his statement that ‘the consumption of alcohol during working hours became the norm’, and that employees he spoke with were ‘clearly under the influence of alcohol or [possibly] drugs’.
- Mr Scott says he had no knowledge of misconduct by his workers. He says safety signage was displayed. He provided a statement from his steel fixer, Ben Norris. Mr Norris said that after he completed the work required by Mr Scott at the site, Mr Stewart engaged him to build a retaining wall and to backfill the area with soil. Mr Norris said that Mr Stewart suggested he bring his children to the site on the weekend to enable the work to be finished earlier. Further, Mr Stewart provided a barbeque and cold drinks for Mr Norris and co-workers at the end of the day after they built the retaining wall.
- Mr Stewart and Mr Scott disagree about whether Mr Stewart brought concerns about intoxication to Mr Scott’s attention at the time.
- Observance or otherwise of safety protocols, and whether workers swore excessively, are largely irrelevant matters, except perhaps in relation to Mr Stewart’s stress claim. However, intoxication and, to a lesser extent, conduct generally, may be relevant in evaluating the shell work to be discussed below.
- While it would be unsurprising if workers sometimes drank alcohol at the end of a day’s work, I am not persuaded that there was intoxication on site while workers were carrying out their duties. It is an improbable scenario, which surely would have prompted firmer action by Mr Stewart in response. Mr Stewart’s witnesses were occasional observers with limited opportunity to study the day-to-day carrying on of construction. I consider that they gave subjective or exaggerated evidence to assist Mr Stewart. Mr Stewart himself may have had more opportunities to observe construction. However, the intensity of his dissatisfaction with the pool and his antipathy toward Mr Scott are likely to have coloured his perceptions and recollection. The intensity of feeling is apparent in Mr Stewart’s references to the pool as ‘the grotesque structure’ and ‘the monstrosity’. Mr Stewart said Mr Scott ‘knowingly / willingly / purposely / maliciously / deceived me’. There are many similar examples in the material.
- Similarly, I am not persuaded that the conduct of the workers in relation to matters such as swearing and wearing safety clothing was outside the norm for construction workers on sites.
Does the pool need to be demolished and replaced?
- As at the first day of hearing, on 17 September 2019, Mr Stewart’s claims included repair, but not demolition and replacement, of the pool. Mr Wiesemes in his oral evidence criticised the finish of the pool shell but said he was not qualified to comment on whether there is a structural problem.
- At the conclusion of the hearing on 17 September 2019, Mr Stewart made oral closing submissions. I made directions for Mr Scott to make closing submissions in writing by a particular date, and then for Mr Stewart to make closing submissions in reply in writing. However, before any written submissions could be filed, Mr Stewart filed an application seeking leave to submit further evidence, namely a structural engineer’s report that he intended to obtain. Mr Scott did not oppose such leave being granted, provided that he had the opportunity to obtain a report by another structural engineer. I granted leave accordingly. By the time of the second day of hearing on 7 November 2019, the parties had each provided reports by structural engineers. Mr Stewart’s was from Mark O’Hagan. Mr Scott’s was from George Frame.
Mr O'Hagan’s report
- Mr O'Hagan’s report is dated 22 September 2019. He noted ‘multiple locations where reinforcing steel, steel tie wire and embedded metallic fixings was exposed’ on the outside face of the pool shell. This represented a failure to comply with the relevant Australian Standard requiring that reinforcement be covered by at least 50 mm of concrete. Additionally, Mr O'Hagan noted locations ‘where larger air voids and honey combing of the concrete is present due to poor placement practices’. Mr O'Hagan considered that this ‘has likely reduced the required minimum concrete covers’. Mr O'Hagan commented on surface defects extending to a depth of up to 50 mm. In a 200 mm-thick wall, this represented a 25% reduction in thickness. This was beyond the 10% tolerance allowed in the Standard. Mr O'Hagan observed that minimum concrete cover is specified in the Standard to ensure adequate durability of concrete structures. A reduction in cover ‘can lead to major structural issues such as concrete cancer occurring prematurely’, i.e. before the end of the intended life span of some 20 to 30 years for a pool. Concrete cancer, he explained, results from the corrosion and expansion of steel exposed to the outside environment.
- Mr O'Hagan also noted that on one of the side walls, where a sheet of galvanising steel was placed, the lower wall foundation was not embedded into the ground. The ground slab bedding stone was therefore free to erode. If the wall was not adequately supported, and further undermining were allowed to continue, this would compromise the structural integrity of the shell.
- Mr O'Hagan noted that the construction joint in the ‘free-standing wall’ appeared to be constructed in an unplanned manner. The joint undulated, and there was a ‘large voided overlap’. The Standard requires that a joint does not impair the load-carrying capacity and serviceability of the structure. Mr O'Hagan said that ‘questions are raised as to the load carrying capacity and serviceability of the structure due to this defect over the required 20-30 year service life’.
- Mr O'Hagan also observed that the information available to him did not indicate that there had been adequate engineering design and supervision. For example, he had seen only a one-page drawing, which did not contain many of the details required.
- Mr O'Hagan noted that coping tiles were cracked at one of the corners. He said it appeared that insufficient grout had been applied under the tile edges.
- Mr O'Hagan noted that the concrete section encasing the skimmer box showed signs of efflorescence and rust staining. This was suggestive of insufficient cover between the PVC pipe and reinforcing steel and inadequate installation of a water stop around the pipe. This impaired the long-term durability of the concrete, in his opinion. Mr O'Hagan also noted that the skimmer box was embedded on a slight angle.
- In conclusion, Mr O'Hagan noted that his report had only identified visible defects, and the full extent of defects was unknown. He then said:
In our opinion [his firm] would not consider issuing structural design certification … or structural construction certification … on the pool, either in its current condition or after the defects noted were rectified. Unless sufficient evidence satisfactory to AS2783 Section 6 is presented confirming the structural design adequacy of the pool shell and construction that was carried out in accordance with a RPEQ certified structural design, we would recommend rebuilding the pool.
Mr Frame’s report
- Mr Frame’s report is dated 27 October 2019. He considered the design to have been ‘generally correct and fit for purpose’. At the time of his inspection in October 2019, the pool was full of water ‘and looked to be well maintained and fit for purpose’. He noted cracking or movement in a few coping tiles but did not consider that to be of structural significance. Mr Frame said that the concrete finish is variable: in some areas it is good or acceptable, while in others ‘it is not particularly attractive/aesthetic’. Mr Frame said he had seen several photographs of the pool during construction and had completed ‘extensive verbal and documentary investigations of the actual construction sequence/procedures’. He said he had checked the contractor’s records to ascertain the quantities of materials delivered to site. He expressed the opinion that ‘the pool as presently constructed is sound and fit for purpose although there are some areas which need attention’.
- Commenting on aspects of Mr O'Hagan’s report, Mr Frame said he did not consider the tie wire protrusions to be particularly significant. They could be cut off ‘and the small hole filled with a suitable epoxy based product’. He noted that Mr O'Hagan had described a likely reduction of concrete cover of reinforcement below the minimum level required, but Mr Frame did not consider that it had been established that there is actually such a reduction. Mr Frame said that concrete cancer had been a problem in buildings constructed close to the ocean using relatively low strength concrete, but he did not consider it to be a legitimate concern for Mr Stewart’s pool. This is because it is constructed of high strength concrete and located several kilometres from the ocean.
- Mr Frame said that the finished surface was ‘below acceptable’ in some locations. He accepted that there may be areas where there was a 25% reduction in wall thickness, but said that delivery dockets indicated that a considerable amount of extra concrete was delivered to site, beyond the amount that would have been required in normal circumstances. This, he considered, ‘may well have resulted in the pool walls being constructed with thickness greater than 200 mm’. He continued:
In any case the voids, whilst significant in some areas, are not considered to be of such volume and size as to markedly affect the strength of the pool AS LONG AS THEY ARE EFFECTIVELY TREATED.
- Treatment would, Mr Frame said, be by way of cleaning the void, exposing the affected steel, and applying rust inhibitors and epoxy-based sealants.
- In relation to the undulating joint, Mr Frame described it as unsightly and as giving ‘a visual impression of poor construction practice’. Ideally, it would be horizontal and straight. However, he did not believe that the nature of the joint indicated any significant loss of structural integrity. In his opinion, it represented a slight movement outwards of the pool formwork, which would have increased the cover to the reinforcing steel. The remedy would be to treat the affected areas with an epoxy sealant / render.
- Mr Frame said he agrees with Mr O'Hagan that work needs to be done in the area where the galvanising steel sheeting had been placed. He did not regard the current problem to be significant, as there is sufficient strength in the reinforced concrete structure to bridge the unsupported length. Mr Frame said there are several ways of attending to the problem, and none of them are particularly expensive.
- In relation to the design documentation, Mr Frame said he had seen nine sheets of engineering drawings. He considered them satisfactory. Mr Frame said he had no precise knowledge of the supervision of the project.
- Mr Frame agreed that the cracked tiles should be replaced and re-grouted.
- In relation to the efflorescence and rust staining in the vicinity of the skimmer box, Mr Frame did not consider it to be structurally significant at present but noted that there could be degeneration over time. He suggested maintenance and waterproofing measures, with the situation to then be monitored. Mr Frame considered the slight misalignment of the skimmer box not to be structurally significant.
- Overall, Mr Frame said that the rectification work he recommended ‘would have been best attended to when first noticed’. However, he said, the pool is structurally sound so long as the recommended work is carried out. The pool does not need to be demolished, in Mr Frame’s opinion.
Oral evidence of the engineers
- Mr O'Hagan and Mr Frame concurrently gave oral evidence on the second day of the hearing, 17 November 2019. They took the opportunity to comment on each other’s reports. Mr O'Hagan was prepared to accept that the design was adequate on the strength of Mr Frame’s examination of the additional drawings. (Mr O'Hagan was giving evidence by phone, so he did not have the opportunity to look over the designs himself). Mr O'Hagan also accepted that the problems in the vicinity of the skimmer box may be able to be remedied, and that the misalignment of the skimmer box is not structurally significant. However, Mr O'Hagan maintained his reservations about the shell: the numerous visual defects serving as a basis for drawing an inference that the reinforcement was not adequately secured at the time of the pouring of the concrete. It could therefore have moved out of place during the pour, such that there may be insufficient concrete cover. Verification, however, would require expensive ground-penetrating radar to determine the position of the steel within the walls. If extra concrete had been used in the walls and created extra thickness, that would not necessarily allay his concerns. In this regard, he referred to the need to balance ratios. Mr O'Hagan maintained his opinion that concrete cancer is a concern, even though the location is not by the ocean. He described an aggressive environment in a pool because of the presence of chemicals.
- Mr Frame too maintained his overall position, contending that a conclusion that reinforcing steel moved would not be justified. He considered that construction photographs depict reinforcing steel as in place and reasonably anchored before the pour. He regarded the information before him as sufficient to certify construction as compliant with design, even though his understanding is that certification of pool construction by an engineer is not a strict legal requirement. Mr Frame mentioned two site inspection certificates written by engineer Mr Ngon Vo, dated 12 October 2017 and 17 November 2017. Mr Vo was the engineer who had been engaged by Mr Scott to design the pool. Both certificates indicated that the site was not ready for the pouring of concrete to proceed. The first recommended that steps be taken such as the obtaining of a soil report. The second expressed concern about delay in pouring, and listed a number of respects in which reinforcement elements were deficient. Mr Frame said the steel fixer had assured him that the matters noted by Mr Vo had been attended to before the pour proceeded. Mr Frame acknowledged, however, that the construction photographs were taken from too far away to confirm that.
- Mr Stewart put to Mr Frame that reliance should not be placed on the construction workers because of their drinking and other misbehaviour on site. Mr Frame said he could not directly comment because he had not witnessed the behaviour, but he added that he had worked on a lot of pools built by Mr Scott and he had not experienced ‘issues with contractors’.
- Mr O'Hagan said that while he had not seen the construction photographs, he would be hesitant to certify the construction as compliant with design on the basis of photographs and documents, without having made his own observations. The comments in Mr Vo’s site inspection certificates did not enhance confidence that the builder had adhered to the design. He would be reluctant to accept the word of a steel fixer, whose interests would not be served by admitting a problem. Mr O'Hagan said that in order to achieve satisfaction to certify the pool ‘retrospectively’ – that is without the benefit of having supervised construction – he would additionally carry out the radar investigations and obtain a geotechnical engineer’s report on the bearing capacity of the soil. As the pool is on a sloping site, he would be very particular to ensure that work had been carried out in accordance with design before certifying. If certification is not possible, Mr O'Hagan indicated, demolition is the only real option.
- Neither party provided a statement from Mr Vo. A notice to attend and give evidence on 7 November 2019 had been issued to Mr Vo, at Mr Stewart’s request, but Mr Vo failed to attend despite having been served with the notice.
Proposed radar evidence
- The second day of the hearing, 7 November 2019, ended in a similar way to the first day. Mr Stewart made closing submissions, and I set a timetable for the filing of written closing submissions by Mr Scott and then written submissions in reply by Mr Stewart. The timetable was interrupted by Mr Stewart filing applications for miscellaneous matters relating to ground penetrating radar evidence. The applications were not entirely clear, but I understood them to mean that Mr Stewart was proposing that he should be given time to have ground penetrating radar investigations carried out, and then be permitted to present evidence about the results in the proceeding. Mr Scott opposed the applications, and in due course I refused them. This involved weighing up various factors. These included:
- (a)the considerations in section 28 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (‘QCAT Act’) which include that the Tribunal can inform itself in any way it considers appropriate, is not bound by procedures applying to courts, and must ensure so far as is practicable that all relevant material is disclosed;
- (b)the fact that Mr Stewart is self-represented and not legally-trained;
- (c)the long history of the matter, including timetables that had been set for the filing of evidence in advance of the hearing and that there had been two hearing days;
- (d)the finite resources of the Tribunal; and
- (e)statutory objectives in section 3 of the QCAT Act to be economical and quick, as well as fair.
- On balance, I did not consider it appropriate to allow Mr Stewart a further opportunity to gather and present additional evidence. It would have protracted the matter. In a building dispute, it is reasonable to expect parties to obtain and disclose their evidence in advance of the hearing. It is not desirable, or fair to the other party, to allow a party to present a rolling and evolving case.
- Similarly, I do not propose to allow into evidence a letter from Mr O'Hagan dated 14 November 2019, which reiterates points made by Mr O'Hagan in his oral evidence. This letter was sent by Mr Stewart to the Tribunal, apparently attached to an application for miscellaneous matters.
Findings arising from the engineering evidence
- As will be apparent from the above discussion, the engineers both gave thorough and carefully considered written and oral opinions. Both were impressive. They each gave logical explanations for their opinions. They were each willing to make appropriate concessions. Each is an experienced engineer, though Mr Frame has considerably longer experience: 42 years, compared with Mr O'Hagan’s eight years. This may explain the more cautious approach exhibited by Mr O'Hagan.
- In light of Mr Frame’s considerably longer practical experience, on balance I prefer the opinions of Mr Frame to those of Mr O’Hagan where there are differences. Consequently, I accept Mr Frame’s opinion that the pool is fit for certification subject to rectification in the ways he suggests, and that demolition and replacement are not necessary in order to meet the design requirements.
- It is undisputed that there are defects in the pool shell at least. Mr Scott attributes this to his not carrying out the usual checks and fixes at the end of the project because of the stalemate that developed. Nonetheless, Mr Scott may be liable in respect of the defects.
- The Tribunal can order rectification by Mr Scott, or award damages. Mr Stewart is adamant that he does not want Mr Scott to return to the site. He has supplied a letter from a psychologist to the effect that he has been experiencing ‘immense stress’ from ‘the ongoing issues with his improperly built pool’. The psychologist said she supports Mr Stewart’s request that Mr Scott ‘not be involved in any way when the pool is removed and rebuilt’. She said she has concerns for Mr Stewart’s ongoing mental health and the pressure on his marriage if he ‘has to endure further contact’ with Mr Scott.
- In light of Mr Stewart’s strong objection, and without making any finding that the objection is rationally based, I am inclined not to order rectification by Mr Scott.
- Although the latest version of Mr Stewart’s claim seeks replacement rather than repair of the pool, I have assumed that he would maintain his claim for damages for repairs in the alternative if demolition and replacement are found unnecessary.
- Once rectification is ruled out, it does not automatically follow that Mr Stewart should be awarded damages for defects for which Mr Scott is responsible. First, there must be sufficient evidence as to the appropriate amount of damages. Second, an award of damages, or full damages, based on a third party carrying out rectification may be unreasonable where Mr Scott could have carried out the rectification himself at lower cost.
- Damages are intended to place the person who has sustained a loss, so far as money can do it, in the same position as if the contract had been performed. Damages can reflect the loss in value of an asset, but in building cases more commonly they will reflect the cost of rectification or reinstatement. This can involve demolition and replacement, rather than mere repair. How damages are measured will depend on what is necessary and reasonable in the particular circumstances.
- In the present case, demolition and replacement of the pool are not necessary in order to place Mr Stewart in the position he would have been in had the contract been performed without defects. Repairs can achieve that objective.
- Mr Wiesemes noted a crack near the skimmer box and a leak in the pool wall on the house side. Mr Wiesemes, Mr O’Hagan and Mr Frame remarked, as discussed above, on the need to treat exposed steel and fill voids in the walls. The two engineers also commented on the need for additional foundational support to one of the side walls.
- These defects involve a breach of the contractual warranty to carry out the works with reasonable care and skill, even accepting Mr Scott’s evidence that he would have ordinarily remedied the breach before completing the project.
- Mr Scott has provided a quotation for $1,518 from Xycrete Pty Ltd (‘Xycrete’) dated 5 November 2019 to ‘supply and apply remedial system to cracks in pool shell’. This was to be ‘in conjunction with the recommendations from the Engineering report’, presumably Mr Frame’s. There is no clear indication in the quotation that the work quoted for would include the foundational work. When Mr Frame was asked about the quotation, he said it was, overall, in line with what he was recommending.
- When Mr Stewart was seeking repair rather than replacement, he provided a quotation from Oasis Developments Pty Ltd (‘Oasis’) dated 8 February 2019. The total quotation cost was $49,638. That included $10,940 for work relating to the shell, involving removing formwork, removing rubbish, treating the steel, patching holes and gaps, and rendering and painting the walls.
- However, the contract between Mr Stewart and Mr Scott did not require the rendering and painting of the pool walls. Indeed, Item 7 in Annexure A to the contract said, in effect, that it was the responsibility of Mr Stewart, if he wished, to ‘dress the outside vertical face of the concrete shell’. The same paragraph warned that exposed shells may be unsightly. Accordingly, the work proposed by Oasis goes beyond rectification and, insofar as rendering and painting are concerned, includes new work.
- Oasis’s quotation was prepared by Ben Eisenhut. In oral evidence, he said that Oasis does not build pools but subcontracts out any pool work. When he was questioned about one of the other prices in the quotation, namely $3,600 for ‘skimmer box leak’, he was unable to explain how he had arrived at that figure. He said he thinks he may have overpriced that item. He indicated that a more accurate price would be about half of $3,600, ‘maybe’. He insisted that the other items in the quotation were ‘fine’.
- Overall, I do not regard Oasis’s quotation as a reliable measure of what it would cost Mr Stewart to have the rectification work carried out, assuming that he would obtain a number of quotations. In reaching this conclusion, I take into account the fact that Oasis does not carry out pool building work, the vagueness of Mr Eisenhut’s oral evidence, and the inclusion of additional works in the quotation.
- On the other hand, there is nothing to indicate that Xycrete’s quotation is similarly unreliable. Mr Stewart is critical of the quotation on the basis that Xycrete relied on ‘a photograph’ rather than an on-site inspection. Nonetheless, the Xycrete quotation is, in my view, the best available evidence about the cost of rectification of the pool shell. Accordingly, I assess the pool shell rectification cost at $1,518.
- Mr Scott has not suggested that he could carry out the rectification work more cheaply himself. It is therefore appropriate to award damages for this item at $1,518.
Skimmer box misalignment
- There is a slight misalignment of the skimmer box. Such a misalignment could warrant damages, depending on whether it is noticeable to the casual observer such that it might affect the value of the property or the aesthetic enjoyment of the pool. There is no indication that the misalignment in this case is noticeable enough to affect the value of the property or the enjoyment of the pool. The engineers agree it is not structurally significant. Accordingly, I see no basis for awarding damages in respect of it.
Skimmer box leak
- Mr Wiesemes described a water leak at the back of the concrete encasement of the skimmer box. He suggested chiselling out and then plugging with a product such as Maxseal. As has been mentioned, Mr O'Hagan described signs of efflorescence and rust staining around the location of a PVC pipe. He thought the likely cause was insufficient cover between the pipe and reinforcing steel, and inadequate installation of a water stop around the pipe. He did not suggest how it should be remedied. Mr Frame suggested that some maintenance and/or waterproofing measures be carried out, and the situation then monitored.
- Mr Scott in his statement suggests that the leak was caused by a failure by Galaxy to seal the ‘pebbly interior’ around the plastic skimmer box. As has been discussed, Mr Scott is not liable for the work of Galaxy.
- On the available evidence, it is not clear which of several possible causes is responsible for the leak. Mr Stewart engaged another firm, Galaxy, to work on the pool before it was finished, and I accept that Galaxy may be responsible. I am unable to be satisfied on the balance of probabilities that Mr Scott is responsible for the leak. Accordingly, I do not award any damages for this item.
Skimmer box lid
- Mr Wiesemes said the skimmer box lid is deficient. The relevant Australian Standard requires it to be child-resistant: either lockable or at least ten kilograms in weight. Mr Wiesemes said the lid does not meet this requirement. In oral evidence, Mr Wiesemes indicated that the defect would be easy to rectify.
- Mr Scott said in his statement that the lid weighs 12 kilograms. However, in the course of the hearing, Mr Adames said that Mr Scott is prepared to accept that the lid weighs less than ten kilograms.
- There is, however, no specific evidence about the cost of replacing the lid or creating a lock in the existing one. Accordingly, I am unable to award damages for this item.
- It undisputed that there are some cracked coping tiles. The cracks had not been present when Mr Wiesemes inspected the pool in February 2018. Mr O'Hagan in 2019 noted cracks in the two southeast corner coping tiles. He attributed the cracking to insufficient grout having been applied under the edges. Mr Frame agreed that the tiles should be replaced and re-grouted. Mr Stewart also mentioned a third cracked tile in one of his statements.
- Mr Scott disagrees that there was insufficient grouting. He argues that damage to the tiles must have occurred during work by other tradespeople engaged by Mr Stewart, such as those who built the deck. Mr Scott also maintains that the deck is built too close to the tiles, and this would put stress on them.
- Again, there are a number of possible causes. It has not been established on the balance of probabilities that an action or omission of Mr Scott or his subcontractors caused the cracks. Accordingly, liability is not established.
Lack of expansion joints in coping tiling
- Mr Wiesemes said in his report that expansion joints have not been provided in the coping tiles, but the relevant Australian Standard requires them at every change of direction and every two lineal metres. In cross-examination, however, he referred to the inclusion of expansion joints in rectangular pools as ‘good practice’, rather than as a strict requirement. He agreed that the joints could still be added.
- Mr Scott says that expansion joints are not required in such a situation under the Building Code of Australia. He says it is rare for expansion joints to be applied in square or rectangular pools ‘as they are free from any outside forces’. He adds that it would be a simple ten-minute process for a tiler to add them, if they are required.
- I am not satisfied on the evidence presented that the inclusion of expansion joints was mandatory, or that the failure to include them constituted a breach of the contractual or statutory warranties.
- It is undisputed that the contract provided for a Speck brand pump to be installed, but the pump actually installed was a Waterco brand. Mr Wiesemes in his report said that the Waterco pump should be replaced with a Speck one, because the contract specified a Speck pump. Mr Wiesemes did not comment on the performance of the Waterco pump in comparison with a Speck pump. Although Mr Stewart considers the Waterco pump inferior to the Speck pump, there is no supporting evidence for this opinion.
- The February 2019 Oasis quotation included $3,559 for a new pump, filter and chlorinator. However, no basis has been established for requiring the replacement of the filter and chlorinator.
- Mr Scott says that a Speck pump can easily be installed to replace the Waterco one.
- The appropriate remedy in such a situation would ordinarily be to order the builder to replace the incorrect pump with the correct one. However, I am not inclined to make such an order because of Mr Stewart’s opposition to Mr Scott returning to the site. I am not satisfied that Mr Scott has suffered any loss from the installation of the non-specified pump, so I am not persuaded that there should be any award of damages for this.
- Mr Wiesemes commented on flaws in the internal lining. Oasis’s quotation for $49,638 covered, amongst other things, grinding back of the ‘existing pebble crete pool finish’ and the installation of a new finish. This work therefore formed part of the $49,368 claimed as repair damages by Mr Stewart as at the first day of hearing on 17 September 2019.
- However, as discussed earlier, Galaxy did the interior lining work directly for Mr Stewart. Mr Scott is not liable for any defects in the work done by Galaxy.
Mr Stewart’s claim for refund of $25,000 paid to Mr Scott
- This relates to the amounts Mr Stewart paid to Mr Scott by way of deposit ($1,925), for stage 1 (excavation and delivery of reinforcement to site: $9,625) and stage 2 (structural shell and internal plumbing: $13,475). These sums add up to a little over $25,000.
- This amount was claimed by Mr Stewart even when he was seeking repair rather than demolition. Mr Stewart has not articulated any clear legal basis for entitlement to a refund (or damages equivalent to the amounts he paid). In submissions, he said that he is entitled to recover the $25,000 because Mr Scott’s work was ‘so deplorable’.
- Under the contract, Mr Stewart was obliged to pay the deposit upon signing the contract. Mr Scott was entitled to claim a progress payment upon completion of each stage. Mr Stewart was then obliged to pay the claim, without any right of set-off apart from any applicable liquidated damages claim under clause 18. The presence of defects was therefore not a basis for withholding payments. This point is reinforced by other clauses in the contract. First, the definition of ‘practical completion’ in clause 1 makes it clear that practical completion of the works can be reached even though there are minor defects. Second, clause 19.2 provides that Mr Stewart cannot retain any part of the contract price during the defects liability period.
- I am satisfied that the deposit was payable under the contract. There is no evidence to suggest that stage 1 was not completed. I find that the deposit and the stage 1 claim were payable under the contract, and there is no basis for a refund or damages.
- The situation with stage 2 is less straightforward because of the defects in the shell. However, even if these defects are regarded as major rather than minor, such that Mr Stewart could have resisted the invoice, the fact is that he paid it. He will be awarded damages in this proceeding for the defects to the extent that is permissible on the evidence. Accordingly, there is no basis for ordering a refund of, or damages for, the stage 2 payment.
Mr Stewart’s claim for ‘replacement deck and retaining’
- The amount claimed by Mr Stewart in damages is $41,574. This is the amount of a quotation by Oasis dated 15 October 2019 to build a retaining wall and a timber deck.
- This work would be necessary only in the event that the pool were demolished and a new pool built. As I have found that demolition is not warranted, I am not satisfied that Mr Scott’s breach will cause the relevant loss. Accordingly, damages in this regard are not payable.
Mr Stewart’s claims for landscaping the back yard
- The amount claimed by Mr Stewart in damages is $5,000, which he described as ‘seal wall, back fill with gravel, topsoil & labour’. Again, this work would be required only in the event of demolition, and so damages are not payable for this anticipated expense.
Mr Stewart’s claim for re-turfing of the back yard
- The amount claimed by Mr Stewart in damages is $1,617. This is the amount of a quotation from Jimboomba Turf Group dated 25 October 2016. Again, this work would be required only in the event of demolition, and so damages are not payable for this anticipated expense.
Mr Stewart’s claim for landscaping of the side yard
- The amount claimed by Mr Stewart in damages is $13,500. This is based on a quotation from Gold Coast Landscapes dated 23 July 2018, which is actually for $13,600. The work described in the quotation involves turfing and paving, as well as installing an irrigation system.
- Mr Stewart says that the side of his property was damaged by Mr Scott’s workers when they were building the pool. Mr Stewart says that he arrived home one day to be told by some of the workers that there had been an altercation between two workers: one became very upset and drove his excavator unnecessarily up down the path several times. Mr Stewart says this ‘utterly destroyed’ the path.
- Mr Wiesemes said in his report that the path and steps at the side of the house were destroyed. He said it appeared to him that no care had been taken to minimise the damage. In cross-examination, however, he conceded that landscaping is not within his area of expertise.
- It is not suggested that Mr Scott was present at the time of the alleged incident, so he cannot directly comment on whether the incident happened. Mr Scott points to the contractual obligation on Mr Stewart to provide and maintain site access for any persons, vehicles or machinery reasonably requiring access for carrying out the construction. There is also a clause in Annexure A to the contract, to the effect that all care is taken but no responsibility accepted if there is damage to property. The clause goes on to characterise such damage, for example to turf and gardens, as ‘necessary damage’. Mr Scott also points to a box ticked in the Appendix to the contract that ramping was not required. Mr Scott says, and I accept, that this means that he was not required to place a ramp over the stairs in the path in order to preserve them.
- It is undisputed that the access that Mr Stewart provided for workers, machinery and materials to the back yard was via the side of his property. There is no direct evidence that wilful damage occurred. Incidental damage was highly likely from the ordinary movement of heavy machinery and materials. I am not satisfied that there was wilful damage, or damage beyond what the contract characterised as ‘necessary damage’. It was clear from the contract that liability was excluded for ‘necessary damage’.
- Accordingly, Mr Scott is liable to compensate Mr Stewart for the damage.
Mr Stewart’s claim for plumbing costs
- The amount claimed by Mr Stewart in damages is $858. This amount comes from a ‘rough quotation’ by Oceanside Plumbing dated 16 July 2018 for repairing two damaged sections of storm water drainage. Mr Stewart says that stormwater piping at the side of his house was ‘ripped off by an excavator’. He says that Mr Scott’s staff told him this was done by them.
- Mr Scott does not concede that he or his workers caused the damage. He says that Mr Stewart had ‘other trade contractors who he had engaged separately working on the site with heavy machinery including excavators’, and that the damage ‘most likely was caused by one of [Mr Stewart’s] other contractors’.
- It is not apparent why Mr Scott would think it more likely that the damage was caused by another contractor. However, even if it was caused by Mr Scott’s workers, in my view it was incidental ‘necessary damage’ in the sense discussed above. Accordingly, I find that Mr Scott is not liable to compensate Mr Stewart for this damage.
Mr Stewart’s claim for painting costs
- The amount claimed by Mr Stewart in damages is $600. This is the amount on a quotation by Stewart’s Painting and Decorating dated 22 May 2019. The quotation relates to repairing and painting six damaged deck posts. As Stewart’s Painting and Decorating is Mr Stewart’s own firm, the quotation is not independent.
- Mr Stewart contends that the damage must have been caused by reinforcing bars being dragged past the posts. He says the cause can be inferred from the shape of the scrapes depicted in a photograph.
- Mr Scott’s response to this issue is similar to his response about the damaged piping, though he adds that the apparent location of the damage makes it unlikely that it was caused by his workers.
- In my view, Mr Stewart may well be correct in attributing the damage to Mr Scott’s workers. However, that would constitute incidental ‘necessary damage’ as contemplated by the contract. Accordingly, I find that Mr Scott is not liable to compensate Mr Stewart for this damage.
Mr Stewart’s claim for lost income
- The amount claimed by Mr Stewart in damages is $41,160. It relates to income which Mr Stewart says he lost through not being able to rent out his downstairs apartment on Airbnb. The amount is calculated at $280 per night, over 147 nights between 7 August 2018 and 1 January 2019, though I assume that Mr Stewart meant the period 7 August 2017 to 1 January 2018. This is because the figure of $41,160 replaces a figure of $8,000 advanced as at the first day of the hearing, for the period 1 December 2017 to 1 January 2018, and there is no obvious reason why 7 August 2018 would be relevant. Presumably 7 August 2017 is when Mr Stewart believes that work should have started under the contract, being three weeks after the signing of the contract.
- Under the contract, the date for commencement was specified as three weeks after Council approval. Approval was granted on 18 August 2017. Work commenced on 11 October 2017, which was almost eight weeks later. Mr Scott has not explained the delay.
- Mr Stewart’s explanation for his expanded claim for lost income is that ‘since the pool is to be removed, I should be reimbursed all lost income’ for the longer period. It appears, then, that Mr Stewart’s rationale is that he was unable to generate income while construction work was, or should have been, in progress, and the work has turned out to be a waste because the pool must be demolished.
- The contract contained a clause entitling Mr Stewart to liquidated damages of $25 per day in certain circumstances, in the event of delay by Mr Scott. However, entitlement to liquidated damages depends on Mr Stewart giving a written liquidated damages claim to Mr Scott within 28 days after the date of practical completion. In this case, there is dispute and uncertainty over whether or when practical completion was reached, but in any event there is no suggestion of a written claim for liquidated damages having been given.
- The liquidated damages clause is expressed to exclude other damages arising from delay. Therefore, Mr Stewart cannot be compensated for lost income associated with delay. As I have found that demolition is not necessary, there was no unnecessary loss of income arising through the carrying out of the construction itself.
- If Mr Stewart’s claim for lost income is actually intended to cover a period after the pool became operational on or about 1 January 2018, I can see no basis for it. The pool is functional. It is visually appealing from the residential and recreational part of the property. The unsightly external walls would not be visible to Airbnb guests except in the unlikely event that they ventured down to the very rear of the block.
Mr Stewart’s claim for delay costs
- The amount claimed by Mr Stewart in damages is $20,425. This is calculated at $25 per day over 704 days, from ‘7 August 2018’ (perhaps meant to be 7 August 2017) to 7 November 2019. Mr Stewart says this is based on clause 24 of the contract.
- Clause 24 gives Mr Scott, not Mr Stewart, the right to claim delay costs in certain situations. This aspect of Mr Stewart’s claim is therefore misconceived.
Mr Stewart’s claim for storage costs
- The amount claimed by Mr Stewart in damages is $20,056. This is calculated at $200 per week for a period of 100.28 weeks, said to be between 2 December 2017 and 7 October 2019. This relates to materials or waste left by Mr Scott on Mr Stewart’s property. Mr Stewart is claiming damages for storing those things.
- Mr Stewart says that Mr Scott had told him he would remove the items but he failed to do so. The items remained in his yard until September 2019 when Mr Stewart removed them. He placed most of the items under his house, and took the rest to the dump. He adopted the figure of $200 per week as this represented what it would have cost to hire a small storage container.
- Mr Scott was obliged to carry out the work with reasonable care and skill, and this would have required him to clean up any mess and remove unused material. However, the stalemate developed and so the clean-up of these items did not occur.
- I see no basis for awarding damages. There is no evidence of any economic loss. There was an impact on visual amenity while the items were left in the yard. However, Mr Stewart could have removed the items at an early stage and entirely mitigated this loss.
Mr Scott’s claim for payment of progress sums
- Mr Scott issued further progress claim invoices to Mr Stewart:
- (a)on 11 December 2017, $3,850 for stage 3 (coping and tiling);
- (b)on 29 December 2017, $3,850 for stage 4 (delivery and installation of filtration equipment);
- (c)on 29 December 2017, $2,075 for stage 5 (internal lining and initial chemical treatment, after the $2,700 deducted because Galaxy carried out the interior lining); and
- (d)on 17 January 2018, $1,000 for the practical completion stage.
- Mr Scott says the work at each stage was complete, and so he was entitled to issue the invoices. Under the contract, progress claims must be paid within three business days. It is undisputed that Mr Stewart has not paid these invoices. Mr Scott seeks an order that Mr Stewart pay the total of these invoices, $10,775, plus interest. The Tribunal can order a party to a building dispute to pay an amount found to be owing by that party to the other party.
- In his written submissions, Mr Stewart points out that Mr Scott was obliged under the contract to obtain building approval to commence construction, but the amended plans including piers did not receive approval until 30 May 2018. The original plans had been approved on 18 August 2017. There were different views expressed in the course of the hearing about whether it had been lawful for Mr Scott to proceed with construction on the new plans prior to approval being given. Mr Stewart has not raised this issue specifically as excluding liability to pay the invoices. It is not apparent that it would provide a basis for refusing to pay, except for the practical completion stage invoice.
Claim for stage 3 (coping and tiling)
- Mr Stewart submits that he is not liable to pay the invoice because the work was substandard. There were no expansion joints, and the need has arisen to replace and re-grout tiles.
- I have rejected Mr Stewart’s submissions that Mr Scott breached the contract in relation to these items. Even if there was a breach, the defects would be minor rather than major. They would not entitle Mr Stewart to resist the invoice. Indeed, the cracking of the tiles had not even occurred when the invoice was issued.
- I am therefore satisfied, and I find, that stage 3 was completed. Mr Stewart was contractually obliged to pay the invoice for stage 3 within three business days.
Claim for stage 4 (filtration equipment)
- Mr Stewart submits that he is not liable to pay the invoice because Mr Scott:
… deliberately delivered and installed an inferior pump, filter and chlorination equipment that did not match the quality equipment as per the leaflets supplied by [Mr Scott’s] representative, Mr Bobardt in the Fantasy Pools Pool Pack.
- As has been discussed, the contract specified that a Speck pump was to be installed, but a different brand pump was installed. The contract did not specify brands for the filter and chlorinator. The installation of the incorrect pump type is properly characterised as a minor defect, because it can be easily changed over. Accordingly, I am satisfied that that stage 4 was completed, notwithstanding that the wrong brand of pump was installed. The invoice was therefore payable within three business days.
Claim for stage 5 (internal lining and initial chemical treatment)
- Mr Stewart submits that the interior lining was defective and needs to be replaced, and so he is not liable to pay the invoice. However, as already discussed, Galaxy did the interior lining. Mr Scott is not liable for any defects in Galaxy’s work. Mr Scott had reduced the charge for stage 5 by the amount Mr Stewart paid Galaxy.
- The pool was filled with water soon after the internal lining was put in. Swimart, a subcontractor for Mr Scott, then carried out the initial chemical treatment. Accordingly, I am satisfied that stage 5 as invoiced was completed by Mr Scott, and that the invoice was payable within three business days.
Claim for practical completion stage
- Mr Stewart submits that practical completion was not reached because ‘there are many major structural defects’ such that the pool needs to be removed. However, I have found to the contrary.
- The Schedule to the contract at Item 10 called for a date to be specified for practical completion. No date was inserted. Instead, Mr Bobardt (I infer) inserted ‘filling pool with water’. This is an event, rather than a date, and the event occurred in late December 2017 or early January 2018. The nomination of that event may suggest that it was intended by the parties that practical completion would occur when the pool was filled with water.
- However, the contract contains clauses about practical completion. Clause 17 sets out a process including the giving of a notice of anticipated practical completion, a final inspection, the preparation of a defects list where relevant, and so on. Those steps did not occur because of the stalemate that developed.
- ‘Practical completion’ is defined in clause 1:
Practical Completion - means that stage of the Works when:
- the Works are completed in compliance with this Contract, including all Plans and Specifications, and all statutory requirements applying to the Works, without any defects or omissions other than minor defects or minor omissions that will not unreasonably affect occupation; and
- if the Owner claims there are minor defects or minor omissions, the Contractor gives the Owner a defects document for the minor defects or minor omissions.
- If Item 10 in the Schedule, which speaks of the pool being filled with water, is taken as defining practical completion, then there would be two competing definitions of practical completion in the contract. That would be problematic in cases, such as the present, where one definition was satisfied but not the other.
- Given that a date rather than an event is called for in Item 10 of the Schedule, I consider that the function of Item 10 is to specify an intended date for practical completion rather than to define practical completion. Accordingly, the clause 1 definition applies. I am not satisfied that it was met, for two reasons. First, all statutory requirements had not been met by the time the invoice was issued in January 2018, because building approval was not obtained for the amended plans until May 2018. Second, no defects document had been given by Mr Scott.
- Further, for the reasons previously explained, I do not consider that practical completion was deemed to have occurred under clause 17.10 on account of Mr Stewart engaging Galaxy.
- Accordingly, I am not satisfied that practical completion as defined in the contract had been reached by 17 January 2018, when the practical completion invoice was issued. I find that Mr Scott was not entitled to issue the practical completion stage invoice, and Mr Stewart is therefore not liable to pay it. Therefore this part of Mr Scott’s counter-application fails.
- Mr Scott in the alternative seeks payment of at least part of the practical completion stage amount on a quantum meruit basis. He cites the cases of Pavey & Matthews Pty Ltd v Paul and Partington & Anor v Urquhart (No 2) for the proposition (in summary), which I accept, that a builder will be entitled to the fair and reasonable value of the builder’s work for a benefit accepted by a homeowner where the homeowner would otherwise be unjustly enriched.
- However, it is not apparent what work, if any, Mr Scott actually carried out in relation to the practical completion stage. Ordinarily at that stage, he would attend to the practical completion inspection and fixing any defects. These things did not happen, because of the stalemate. I am not satisfied that any amount is payable on a quantum meruit basis for the practical completion stage.
- Interest for late payments is set by the contract at 10% per annum, calculated on daily rests, payable from the day after the payment was due until the date of payment.
Conclusions on this part of Mr Scott’s counter-application
- I will order Mr Stewart to pay the amounts of the invoices for stages 3, 4 and 5, but not the practical completion stage invoice.
- The invoice for stage 3, for $3,850, was payable on 14 December 2017, so interest started to accrue on 15 December 2017. The invoices for stages 4 and 5, for amounts totalling $5,925, were payable on 4 January 2018, so interest started to accrue on 5 January 2018. I will order Mr Stewart to pay interest accordingly.
Mr Scott’s variation claim
- Mr Scott seeks an order that Mr Stewart pay him $7,703.52 plus interest, for an unpaid invoice that Mr Scott issued on 28 December 2017.
- The invoice was headed ‘Variation to Contract’, and it related to the amended engineering design to include concrete piering, and the supply and installation of the piers. It is undisputed that piering was required because the pool protruded more than two metres above ground level at the rear.
- As has been mentioned, the original engineering designs, drawn in July 2017 and approved in August 2017, did not include piers.
- Mr Scott did not visit the site until October 2017, well after the contract was signed. Mr Scott says that when he visited the site, and learned that Mr Stewart wanted the pool to be level with the back patio, it became apparent that the rear of the pool would protrude considerably more than two metres above ground level. Therefore, piers would be needed. Mr Scott says he offered Mr Stewart the option of withdrawing from the contract, or for the pool to be built closer to the house so that the original pier-less design could still be used. Mr Stewart declined these options.
- On 13 November 2017 Mr Scott emailed Mr Stewart:
… Thank you for your time this morning. As we discussed with the additional work being carried out re, Concrete Piers, the minimum cost at this stage will be $5,000.00
I will keep you informed as to the cost as the invoices come in to my office, I can’t see the cost being any less, at this stage the maximum would be $7,700.00.
Please reply to this email for your approval and [confirmation]. …
- Mr Stewart emailed back the same day:
… I approve but we need to keep the additional cost to an absolute minimum.
- Mr Scott says there was therefore an agreed variation, permitting him to charge the additional cost to Mr Stewart.
- Mr Stewart’s position is that there was no variation in the manner required by the contract, so he did not become liable to pay the invoice. He strongly objects to Mr Scott charging more than the original contract price.
- Mr Stewart is correct in contending that there was no variation in the manner required by the contract. Clause 12 sets out a detailed method to be followed to bring about a variation. This would include Mr Scott providing a ‘variation document’ setting out details including the date of the request for the variation, Mr Scott’s estimate of any period of delay to the progress of the works as a result of the variation, any adjustment to the contract price as a result of the variation, and so on. No such variation document was given. Several of the required details were not shown in the email. No firm variation to the contract price was provided; instead, merely an estimated range was given. I find that there was no variation as contemplated by the contract, and therefore Mr Stewart was not contractually obliged to pay the invoice.
- Mr Scott submits that if the Tribunal finds that he had no contractual right to payment for the variation, he would be entitled to payment on a quantum meruit basis. I have mentioned the basis for quantum meruit awards, in paragraph 163 above.
- Mr Stewart did accept work done by Mr Scott that was in addition to the work required under the original engineering drawings. Mr Stewart gained a benefit in that he was able to have the pool built in his desired location. That would not have been possible using the original drawings. He was given the option to withdraw from the contract.
- To determine whether there would be unjust enrichment if Mr Stewart is not required to pay for the additional cost, it is necessary to consider more of the surrounding circumstances and the terms of the contract.
- The price for the construction of the pool was stated in the contract to be $38,500, though it was noted that the price was subject to change under various clauses including the variation clause. I am satisfied that none of those clauses are applicable here. Mr Stewart therefore would reasonably have expected that the price would not increase except in accordance with any of those clauses.
- Under the contract, the plans – in other words the engineering drawings – were to be provided by Mr Scott.
- The works as described in the Schedule to the contract included ‘extra formwork and concrete base required for out of ground structure’, but ‘piering or other special structural requirements below existing ground level’ were excluded.
- Mr Stewart says he understood that piers would be needed because of the slope, and that when Mr Bobardt wrote in the phrase ‘extra formwork and concrete base required for out of ground structure’, Mr Stewart believed this was intended to cover the required piering. Further, Mr Stewart says that he made it clear to Mr Bobardt that he wanted the top of the pool to be level with the back patio. It would be surprising if Mr Stewart had wanted something different. I accept Mr Stewart’s evidence on these matters.
- The Appendix to the contract contained a plan of the pool. I infer that the plan was drawn by Mr Bobardt. The pre-printed notes said that the plan must include the locations of the property boundaries and the critical dimensions of the works. However, the plans did not indicate the property boundaries, so they did not show the exact location of the pool within the back yard. Nor were all critical dimensions, such as the heights of the exterior walls, shown.
- In oral evidence, Mr Scott said that Mr Bobardt had taken measurements to show where the pool was to be located, and there had been no disagreement between himself and Mr Stewart when they met on site about where the pool was intended to be located (relative to the boundaries). However, Mr Stewart explained that he wanted the top of the pool to be level with the back patio. That meant that the height of the rear external wall would be substantially in excess of two metres. The existing engineering design, without piers, would not be adequate.
- In light of this evidence, I find that there was an existing mutual understanding between the parties at the time the contract was signed about where the pool was to be located relative to the boundaries. Mr Bobardt may not have documented that Mr Stewart wanted the top of the pool to be level with the back patio, but Mr Bobardt should have indicated this in the plan in order to show the precise location. Mr Scott was the party to the negotiations with specialist technical knowledge about pool construction and pricing. He should have ensured that all critical dimensions of the pool, including the height of the external walls, were documented in the plan before the contract was signed. Had he done so, the need for piers would have been apparent; this would have been reflected in the price; and Mr Scott would have obtained engineering drawings at the outset that included piers. The need to change the plans occurred because Mr Scott failed to ensure that all critical dimensions were shown in the contract. It is reasonable to expect him to accept financial responsibility for that, notwithstanding Mr Stewart’s reluctant agreement, under pressure, to pay an additional amount. The option for Mr Stewart to withdraw from the contract was not a feasible one in circumstances where Mr Stewart was keen to have the pool built well before Christmas and the project was already running late.
- I am not satisfied that the acceptance of the benefit of the additional work by Mr Stewart would result in enrichment that is unjust in these circumstances.
- It follows that Mr Stewart is not liable to pay Mr Scott for the work covered by the ‘variation’ invoice on either a contractual or a quantum meruit basis.
Mr Stewart’s claim for stress
- Mr Stewart claims $259,437 for stress. As has been mentioned, Mr Stewart selected this figure simply by duplicating the amount claimed as damages under other categories.
- Damages for psychological harm can be awarded by courts in tort actions. Parliament has not expressly conferred jurisdiction in tort upon the Tribunal, and I would not assume that the Tribunal has such jurisdiction in the absence of clear words.
- Ultimately, in his written submissions, Mr Stewart addressed this aspect of his claim in terms of ‘solatium’, which is sometimes referred to as damages for loss of amenity. He has cited a number of cases, which I will discuss below.
- In Dyer v Spence, QCAT noted that solatium had been awarded in a variety of situations. One was where there had been a breach of contract but rectification was not necessary and reasonable. Another was where the owner faced inconvenience and disappointment at not receiving the result for which they had contracted. In the case before it, QCAT noted the ‘significant extent’ to which the builder had departed from the work required by the contract. QCAT decided to award, in addition to other damages, $5,000 in solatium:
… in view of the number of departures from the contract documents and the potential seriousness of the change to the external walls not allowing for the extensions to the upper floors to be built at a later date.
- In Coshott & Anor v Fewings Joinery Pty Ltd, the New South Wales Court of Appeal considered an order made by the District Court for solatium of $5,000. The District Court had also awarded damages for rectification or replacement of doors and components of windows. The award was for inconvenience that the homeowner would suffer from rectification work and their disappointment in not getting the exact high quality result for which they had bargained. The Court of Appeal considered the award sound and modest.
- In Willshee v Westcourt Ltd, the Western Australian Court of Appeal awarded $5,000 to a homeowner for distress and inconvenience arising from disruption that would be caused in vacating the house while rectification was carried out.
The general rule is that damages for anxiety, disappointment and distress are not recoverable in an action for breach of contract. The principal exceptions to that rule are where the contract is one whose object is to provide enjoyment, relaxation or freedom from molestation, and where the damages proceed from physical inconvenience caused by the breach.
- The Court of Appeal went on to note examples of physical inconvenience: offensive odours, a leaking roof, unsanitary conditions, and being obliged to vacate the premises.
- Mr Stewart submits that he has been caused a significant amount of physical inconvenience and distress, and that the process of removing and rebuilding the pool is likely to cause substantial inconvenience. Mr Stewart submits that Mr Scott failed to meet his contractual warranties relating to the quality of work and skill. Mr Stewart submits that photographs of the site establish ‘clear physical imposition’ on him.
- I am not persuaded that there should be any award of solatium in this case. I am not satisfied that there has been physical imposition on Mr Stewart of the nature contemplated in the cases cited. It will not be necessary for Mr Stewart to vacate the house while rectification is carried out. The pool has been in use since it was filled with water. It has functioned effectively. As I have commented, the appearance of the pool from the house and recreational areas is visually pleasing. The external walls are visible only from the rear of the yard, which is not a recreational area. The appearance of those walls will be improved through rectification. The appearance can be further enhanced by ‘dressing’ them by way of rendering and painting. As I have mentioned, the contract noted that dressing the walls was not included in the contractual scope of works.
- The nature and extent of rectification that is required is not extraordinary. It is commonplace in construction projects for problems to be encountered and for homeowners to experience stress, disappointment and inconvenience as a result. Equally, builders whose invoices are not paid experience stress, disappointment and inconvenience.
- There is no basis for awarding solatium, or damages for stress.
Mr Stewart’s other claims
- The other claims made by Mr Stewart (court costs, CD and audio copies, Auscript and printing) are properly characterised as claims for costs.
- In his submissions, Mr Stewart submits that there should be no order for costs. He points to section 100 of the QCAT Act. It is to the effect that each party should generally bear its own costs of a proceeding. I note, however, that the power to award costs under section 77(3)(h) of the QBCC Act has been interpreted as displacing the general rule and conferring a broad discretion about whether costs should be awarded.
- Mr Scott argues, and I accept, that any submissions on costs should come later, after the parties have had the opportunity to consider the decision and these reasons. Accordingly, I will make directions about any cost submissions, should a party choose to pursue an order for costs.
- I will make orders for Mr Stewart to pay the amount of the unpaid invoices (other than the ‘variation’ invoice and the practical completion invoice) which total $9,775, plus interest, less $1,518 which is the amount intended to compensate Mr Stewart for the cost of having the pool shell wall defects remedied.
 ‘Building dispute’, ‘domestic building dispute’ and ‘reviewable domestic work’ in Schedule 2 to the QBCC Act.
Acts Interpretation Act 1954 (Qld), s 14A(1).
QBCC Act, s 19, s 22.
 Exhibit 1. References here and in subsequent paragraphs will omit ‘+ GST’.
 Exhibit 3.
 Exhibit 4.
 Contract, clause 3.2.
 Ibid, Appendix, Item 26.
 Mr Scott's statement dated 5 July 2019, Attachment LS15.
 Ibid, Attachment LS17.
 Contract, clause 17.7.
 Ibid, clause 17.10.
 Mr Stewart's statement dated 22 May 2019, 3.
 Exhibit 9, 7.
 Ibid, 15.
 Ibid, 17.
 Exhibit 10.
 Ibid, 2.
 Ibid, 3.
 Ibid, 4.
 Ibid, 6.
 Exhibit 11.
QBCC Act, s 77(3).
 The psychologist’s report is part of Exhibit 3.
Ruxley Electronics & Constructions Ltd v Forsyth  1 AC 344, 355.
Bellgrove v Eldridge (1954) 90 CLR 613, 618.
 Exhibit 8.
 Labelled Document 7 in material filed by Mr Stewart on 27 May 2019.
 Mr Scott's statement dated 5 July 2019, .
 Ibid, .
 Exhibit 1.
 Contract, clause 11.5.
 Ibid, clause 11.6.
 Ibid, clauses 11.7 and 11.8.
 Exhibit 3.
 Mr Stewart’s statement dated 15 July 2019, .
 Contract, clause 7.3.
 Ibid, Annexure A, .
 Ibid, Appendix, Item 3.
 Mr Stewart's statement dated 15 July 2019, .
 Mr Scott’s statement dated 5 July 2019, [134-135].
 Contract, Schedule, Item 9.
 Exhibit 3.
 Contract, clause 18.
 Ibid, clause 18.2.
 Exhibit 3.
 Contract, clause 10.1(b).
 Ibid, clause 11.7.
QBCC Act, s 77(3)(a).
 29 May 2018 according to Exhibit 6.
 Mr Stewart’s submissions filed 21 February 2020, [44(c)].
 Ibid, [44(e)].
 (1987) 162 CLR 221.
  QCATA 120.
 Contract, Schedule, Item 19; and clause 11.9(a).
 Exhibit LS6 to Mr Scott's statement dated 5 July 2019.
 Contract, Schedule, Item 3.
 Ibid, Item 7.
 Ibid, Items 25 and 28.
 Contract, Appendix, Part C.
  QCAT 211.
 Ibid, .
 Ibid, .
  NSWSC 270.
  WASCA 87.
  VSCA 259.
 Ibid,  (footnotes omitted).
 Ibid, .
 Mr Stewart’s submissions filed 21 February 2020, .
Lyons v Dreamstarter Pty Ltd  QCATA 142, -.
- Published Case Name:
Stewart v Scott trading as Fantasy Pools Brisbane
- Shortened Case Name:
Stewart v Scott
 QCAT 110
10 Mar 2020