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CITE

Unreported Judgment

Stevens v Queensland Building and Construction Commission[2020] QCAT 355Member Kanowski
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Stevens v Queensland Building and Construction Commission[2020] QCAT 355

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:

Stevens v Queensland Building and Construction Commission [2020] QCAT 355

PARTIES:

patricia ann stevens

(applicant)

Queensland Building and Construction Commission

(respondent)

APPLICATION NO/S:

GAR082-19

MATTER TYPE:

General administrative review matters

DELIVERED ON:

9 September 2020

HEARING DATE:

1 September 2020

HEARD AT:

Brisbane

DECISION OF:

Member Kanowski

ORDERS:

The decision of Queensland Building and Construction Commission made upon reconsideration on 25 July 2019 to partly disallow Patricia Ann Stevens’ claim under the statutory insurance scheme is set aside.
A decision is substituted to wholly disallow Patricia Ann Stevens’ claim under the statutory insurance scheme.

CATCHWORDS:

PROFESSIONS AND TRADES – BUILDERS – STATUTORY INSURANCE SCHEME – where builder fraudulently claimed to hold a building licence – whether contractual relations formed – whether residential construction work – whether fixed price contract

Queensland Building and Construction Commission Act 1991 (Qld), s 69(2)(a)(iii)

Queensland Building and Construction Commission Regulation 2003 (Qld), s 10, s 11, s 12

Queensland Building and Construction Commission v Fox [2005] QDC 129

APPEARANCES & REPRESENTATION:
Applicant:	Self-represented
Respondent:	D McNulty, solicitor employed by Queensland Building and Construction Commission

REASONS FOR DECISION

Introduction

[1]
The respondent (‘QBCC’) administers a statutory insurance scheme known as the Queensland Home Warranty Scheme.^[1]
[2]
The tribunal can review a decision made by QBCC to disallow a claim under the statutory insurance scheme wholly or in part.^[2] This is such a review: Ms Stevens has applied to the tribunal to review a decision made by QBCC to partly disallow her non-completion claim under the statutory insurance scheme. The claim relates to airconditioning and renovation work that was to be carried out in 2016 at Ms Stevens’ home (‘the house’) and at a unit owned by her daughter (‘the unit’).

Background

[3]
There was no formal contract for any of the work, but three invoices were issued to Ms Stevens. These invoices were issued in the name:

Cool in Summer

Airconditioning

Warm in Winter

[4]
The invoices are numbered 77, 84, and 85. They are dated 12 January 2016, 27 January 2016, and 2 February 2016 respectively.
[5]
The following matters are undisputed:
1. (a)
  the details and prices on the invoices were inserted by Mr Zak Mar;
2. (b)
  Mr Mar signed all of the invoices, and Ms Stevens signed invoice 84;
3. (c)
  invoice 77 was for the installation of airconditioning at the unit; and
4. (d)
  invoice 84 was for the installation of airconditioning at the house and for renovations of the house.
[6]
Invoice 85 is more difficult to interpret. It shows the addresses of both the house and the unit. It refers to invoice 84, apparently to incorporate work from that invoice. Ms Stevens told the tribunal that invoice 85 was drawn up partly to reflect that she had told Mr Mar that she wished to delete an item relating to the replacement of the kitchen bench, sink and splashback in invoice 84. Invoice 85 also lists a number of renovation tasks, and Ms Stevens told the tribunal that these were to be carried out at the unit.
[7]
It is also undisputed that:
1. (a)
  Mr Mar did not hold a building licence, nor did any of the companies associated with him including Cool in Summer Air Conditioning Pty Ltd, TS Home Services Pty Ltd or MR Lifestyle Construction Pty Ltd;
2. (b)
  Mr Mar and entities associated with him have since been fined for engaging in unlicensed building work; and
3. (c)
  Ms Stevens paid considerable sums to Cool in Summer Air Conditioning Pty Ltd and TS Home Services Pty Ltd, as nominated by Mr Mar, for work done or to be done under the invoices, but the work was not completed.
[8]
Further, it is undisputed that:
1. (a)
  Ms Stevens met Mr Mar as a result of ringing a number shown in a newspaper advertisement for ‘Cool in Summer Airconditioning’;
2. (b)
  the advertisement related to airconditioning installation, servicing and repairs, and it displayed the details: ‘BSA: 114052; ARC: L080238’;
3. (c)
  ‘BSA’ refers to Building Services Authority, the predecessor of QBCC;
4. (d)
  no building licence, let alone licence number 114052, had been issued to Mr Mar or any entity associated with him;
5. (e)
  building licence number 114052 had been issued to Mr Michael Russell;
6. (f)
  the ARC number was for a refrigerant handling licence issued by the Commonwealth Department of the Environment to Mr Mark Beard; and
7. (g)
  invoices 77, 84 and 85 bore the ARC licence number but not the building licence number.
[9]
On 1 March 2017 Ms Stevens lodged a non-completion claim with QBCC under the statutory insurance scheme.
[10]
Although the statutory insurance scheme generally applies to contracts with licensed contractors, it also applies to a contract with a person:

… fraudulently claiming to hold a licence under which the person may enter into contracts with consumers to carry out residential construction work covered by the statutory insurance scheme.^[3]

[11]
Ms Stevens contends that Mr Mar is such a person.
[12]
On 2 May 2017 QBCC wholly disallowed the claim, on two bases. First, it said that no policy of insurance arose. It did not accept that there had been a relevant fraudulent claim by Mr Mar. Alternatively, if a policy arose, Ms Stevens had engaged other contractors to proceed with work, and this allowed QBCC to refuse any coverage under the policy.
[13]
After that decision was confirmed on internal review on 7 June 2017, Ms Stevens sought review in the tribunal. That proceeding was GAR177-17. On 3 October 2018 the tribunal set aside QBCC’s decision.^[4] The tribunal also made three further orders, which were in summary, that:
1. (a)
  a policy of insurance came into force in respect of the residential construction work set out in invoice 77;
2. (b)
  a policy of insurance came into force in regard to the airconditioning supply and installation residential construction work set out in invoice 84; and
3. (c)
  a policy of insurance did not come into force in respect of the balance of the work in invoice 84, or in respect of the work in invoice 85.
[14]
These three orders must have been, in substance, directions to guide QBCC when reconsidering Ms Stevens’ claim.^[5]
[15]
The tribunal’s reasoning, in summary, was:
1. (a)
  the newspaper advertisement had been placed by Cool in Summer Air Conditioning Pty Ltd;
2. (b)
  the advertisement constituted a fraudulent claim by that company that it held a building licence to supply and install airconditioning;
3. (c)
  each invoice evidenced a separate contract between Ms Stevens and Cool in Summer Air Conditioning Pty Ltd;
4. (d)
  a policy of insurance under the statutory insurance scheme came into force in respect of the invoice 77 contract as it was for airconditioning supply and installation;
5. (e)
  a policy of insurance under the statutory insurance scheme came into force in respect of the invoice 84 contract to the extent that the contract related to airconditioning supply and installation;
6. (f)
  a policy of insurance under the statutory insurance scheme did not come into force in respect of the balance of the work under invoice 84, or to any of the work under invoice 85, as that work was construction work other than airconditioning supply and installation.
[16]
Ms Stevens’ claim was then considered afresh by QBCC. On 10 December 2018 QBCC decided to pay $4,448 on the claim. Ms Stevens applied for an internal review, and on 5 February 2019 QBCC decided to change its decision such that only $2,217.04 was to be paid. Ms Stevens then commenced the present review proceeding in the tribunal, on 27 February 2019. On 18 July 2019 the tribunal invited QBCC, under section 23 of the QCAT Act, to reconsider its decision. The reconsidered decision was made on 25 July 2019, and it was to pay $4,217.04 on the claim. This represented a partial disallowance of Ms Stevens’ claim.
[17]
A significant factor in QBCC’s oscillation was that it considered that the tribunal’s decision in October 2018 had been flawed: a policy of insurance under the statutory insurance scheme could arise only in respect of ‘residential construction work’,^[6] and the installation of airconditioning (not combined with other construction work) is not residential construction work as defined. Ultimately, however, QBCC took the view that it was bound to implement the tribunal’s decision.

Legislative framework

[18]
The tribunal’s review proceeds as a review of the reconsidered decision made on 25 July 2019.^[7] The tribunal must conduct a fresh hearing on the merits, to reach the correct and preferable decision.^[8]
[19]
Section 69(2) of the QBCC Act explains when a policy of insurance under the statutory insurance scheme comes into force, and on what terms:

(2)
A policy of insurance comes into force in the terms stated in the board’s policies for the purpose—

(a)
if a consumer enters into a contract for the performance of residential construction work, and—

(i)
the contract bears the licence number of a licensed contractor and, under the licensed contractor’s licence, the licensed contractor may enter into contracts with consumers to carry out residential construction work covered by the statutory insurance scheme; or

(ii)
the contract is with a licensed contractor and, under the licensed contractor’s licence, the licensed contractor may enter into contracts with consumers to carry out residential construction work covered by the statutory insurance scheme; or

(iii)
the contract is with a person fraudulently claiming to hold a licence under which the person may enter into contracts with consumers to carry out residential construction work covered by the statutory insurance scheme; or

(b)
if the work is speculative residential construction work carried out by a licensed contractor and, under the contractor’s licence the contractor may carry out residential construction work covered by the statutory insurance scheme.

[20]
‘Residential construction work’ means building work classified by regulation as residential construction work.^[9] ‘Residential construction work’ is explained in sections 10 to 12 of the QBCC Regulation:

10 Classification as residential construction work

For the Act, schedule 2, definition residential construction work, the following is classified as residential construction work—

(a)
primary building work;

(b)
associated building work.

11 Meaning of primary building work

(1)
Subject to subsection (3), for section 10 (a), building work mentioned in subsection (2) is primary building work if it is—

(a)
carried out by a building contractor; and

(b)
for a residence or a related roofed building; and

(2)
For subsection (1), the following is the building work—

(a)
construction of the residence or related roofed building;

(b)
building work that affects the structural performance of the residence or related roofed building;

(d)
building work for replacement or refitting of fixtures or fittings in a bathroom or kitchen in the residence or related roofed building;

(e)
building work for an unenclosed, elevated platform or verandah, including a deck, attached to a residence;

(f)
building work that increases the covered floor area of the residence or related roofed building;

(g)
building work for installation or repair of the primary water supply to, or sewerage or drainage for, the residence or related roofed building.

(3)
The following is not primary building work, but may be associated building work—

(a)
fencing;

(b)
landscaping;

(d)
installation, renovation, repair or replacement of any of the following—

(i)
airconditioning;

…

12 Meaning of associated building work

(1)
For section 10 (b), associated building work is the following building work that is not primary building work, but is other building work carried out under a contract that includes primary building work (the other building work)—

(a)
if the primary building work under the contract is for a residence, other building work for anything on the site of the residence, but only if the other building work is for residential purposes;

(b)
if the primary building work is for a related roofed building, other building work on the site of the residence or proposed residence for which the related roofed building is to be used, but only if the other building work is for residential purposes.

(2)
Despite section 5, work mentioned in schedule 1AA, section 2, 20, 21, 26, 29, 30, 32, 36 or 40 is building work that is associated building work if it is other building work.

[21]
The policy terms are set out in QBCC’s Insurance Policy Conditions Edition 8 (effective 1 July 2009).^[10] Part 1 deals with non-completion, and includes clause 1.2:

The QBCC is only liable to pay for loss under this Part when the contract is for a fixed price and the insured has properly terminated the contract with the contractor.

[22]
‘Fixed price’ is defined:

“fixed price” means a price which is certain, except for the effect of provisional costs or sums, prime costs or sums, variations and any cost escalation clause.^[11]

[23]
Clause 11.2 is headed Interpretation, and includes:

Unless the contrary intention appears, wherever terms defined by the Act or the Regulation appear in this policy, those terms have the same meaning in this policy as in the Act or the Regulation …^[12]

[24]
‘Act’ and ‘Regulation’ are defined as the QBCC Act and the QBCC Regulation respectively.^[13]
[25]
‘Provisional costs or sums’ and ‘prime costs or sums’ are not defined in the QBCC Act or the QBCC Regulation, but the closely-related terms ‘prime cost item’ and ‘provisional sum’ are defined in the QBCC Act:

prime cost item, for a domestic building contract, means an item, including, for example, a fixture or fitting—

(a)
that has not been selected, or the price of which is not known, when the contract is entered into; and

(b)
for the cost of supply and delivery of which a reasonable allowance is, or is to be, made in the contract by the building contractor.^[14]

10 Meaning of provisional sum

(1)
A provisional sum, for a domestic building contract, is an amount that is an estimate of the cost of providing particular contracted services.

(2)
However, subsection (1) applies only to contracted services for which the building contractor, after making all reasonable enquiries, can not state a definite amount when the contract is entered into.

(3)
The reference in subsection (1) to the cost of providing the contracted services includes a reference to the cost of supplying materials needed for the subject work.^[15]

QBCC’s position

[26]
QBCC’s submissions include, in summary:
1. (a)
  the newspaper advertisement included a fraudulent claim that an entity associated with Mr Mar held a building licence;
2. (b)
  however, it is doubtful that the fraudulent claim could give rise to a policy of insurance under the statutory insurance scheme because it related to airconditioning installation, which is not ‘primary building work’;
3. (c)
  a policy can arise under the statutory insurance scheme only in respect of a contract for the performance of residential construction work;
4. (d)
  the available evidence does not permit a clear finding that there was a contract or contracts, for various reasons, including that it is unclear whether the party other than Ms Stevens was Mr Mar or one of his entities;
5. (e)
  if there was a contract or contracts, the better view is that invoice 77 evidences one contract, with invoice 84 evidencing a second contract that was either terminated or varied when invoice 85 was issued;
6. (f)
  a policy of insurance under the statutory insurance scheme could not arise in respect of invoice 77 because the work under that invoice involved installing airconditioning alone, and such work is not residential construction work as defined;
7. (g)
  a policy of insurance under the statutory insurance scheme could arise in respect of the airconditioning work under invoice 84, on the basis that it was ‘associated building work’ done in combination with other construction work;
8. (h)
  however, there are other reasons why a policy would not arise, including that the terms of the contract were too open-ended – for example invoice 84 included an item ‘Tile Patio. Included in price. But tiles chosen will be extra’ – for it to be described as a contract ‘for a fixed price’;
9. (i)
  if a policy did arise, consideration would need to be given to whether the amount payable should be reduced under other policy terms dealing with matters such as pre-payments and the engagement of other contractors without QBCC approval;
10. (j)
  the previous tribunal decision was in error, and the tribunal in the present review is not bound by that previous tribunal decision; and
11. (k)
  overall, the correct and preferable decision is that Ms Stevens’ claim should be wholly disallowed.

Ms Stevens’ position

[27]
Ms Stevens’ submissions include, in summary:
1. (a)
  the fraudulent claim in the newspaper advertisement should not be regarded as confined to airconditioning, as the advertisement noted both a building licence and an airconditioning licence;
2. (b)
  the three invoices all relate to just one contract: the work was all to be done within a short time frame; airconditioning and tiling work was carried out simultaneously at the unit; and receipts were issued both by the airconditioning company and associated companies of Mr Mar;
3. (c)
  if the tribunal is not persuaded that there was just one contract, then invoices 84 and 85 should be treated as one contract;
4. (d)
  the contract was for a fixed price, and ‘it is open to argue that the specified extras were at the Applicant’s cost and the other items were at the builder’s cost’;^[16]
5. (e)
  invoices 84 and 85 have ‘sufficient pricing to establish a fixed price contract but if that is held not to be so then they should be deemed to be fixed price for the purpose of the claim’;^[17]
6. (f)
  QBCC should not be permitted to rely on technicalities to avoid liability under the statutory insurance scheme;
7. (g)
  further, QBCC frustrated the contract when it issued stop work notices through lawyers representing one of Mr Mar’s entities on 22 December 2015 and 8 February 2016, causing Mr Mar to cease work;
8. (h)
  the tribunal should come to a fair and reasonable assessment of the circumstances, and deem compliance with the policy terms if necessary;
9. (i)
  it would be harsh and unreasonable to hold her to the strict terms of the policy when Mr Mar’s devious conduct meant that she was not made aware of the statutory insurance scheme and the policy terms at the time in question;
10. (j)
  the correct and preferable decision is that the statutory insurance scheme covers her loss, and QBCC should be required to have the remaining work carried out;
11. (k)
  alternatively, she should be paid $61,000 under her claim.
[28]
Ms Stevens relies on observations made in Queensland Building and Construction Commission v Fox to the effect that the statutory insurance scheme provisions are remedial and so, in the event of ambiguity, they should be given a wider rather than a narrower interpretation.^[18] Ms Stevens submits that a similar approach should be taken to the interpretation of the invoices.^[19]

QBCC’s position in response

[29]
QBCC submits that the statutory insurance scheme is not a broad compensation scheme for victims of fraud, and that Ms Stevens’ eligibility or otherwise for payment depends on whether the policy terms actually respond to her circumstances. I accept this submission.

Frustration

[30]
There is nothing in the terms of the policy that create liability in the event of the contract being frustrated. Liability arises only where a contract has been ‘properly terminated’ by the insured person.^[20] A contract that is frustrated is ended by some external event, rather than through termination by a party. Accordingly, it is not necessary to consider further whether Ms Stevens is correct in submitting that QBCC frustrated the building contract/s.

Can the tribunal depart from the 2018 tribunal decision?

[31]
As discussed above, the tribunal in 2018 decided that a policy of insurance under the statutory insurance scheme came into force in relation to some of the work in question. QBCC submits, however, that the tribunal erred, so I need to consider whether I am bound by the 2018 tribunal decision.
[32]
Section 126(1) of the QCAT Act says that ‘a decision of the tribunal in a proceeding is binding on all parties to the proceeding’. This does not, in my view, make a tribunal decision binding on the tribunal itself in a subsequent proceeding.
[33]
However, section 126(2) of the QCAT Act should also be taken into account. It says:

(2) The making, by the tribunal, of a final decision in a proceeding for a minor civil dispute does not prevent a court or another tribunal making a decision about an issue considered (whether or not decided) by the tribunal in the proceeding if the issue is relevant to a proceeding for another matter before the court or other tribunal.

[34]
This may suggest that issue estoppel would operate in proceedings other than minor civil disputes, such that a decided issue could not be re-agitated in a later proceeding. Ms Stevens’ proceedings in the tribunal have not been for a minor civil dispute, as defined.^[21] They have, rather, been proceedings for the review of a reviewable decision made under a statutory scheme. As has been noted, however, the task of the tribunal is to make the correct and preferable decision.^[22]Accordingly, if I were to conclude that the tribunal had erred in 2018, it would not be appropriate to perpetuate the error in the current proceeding. I therefore consider that I am not bound by the 2018 tribunal decision.

Did Ms Stevens enter into a contract, or contracts?

[35]
QBCC submits, and I accept, that a fundamental requirement for a contract is that the parties have reached a concluded bargain. Further, while a contract can be partly or wholly oral, the terms must be clear and certain.
[36]
On the other hand, it is relevant to note that terms can be implied in order to give business efficacy to a contract.^[23]
[37]
QBCC submits that the invoices are not sufficiently clear to constitute a contract or contracts. They were issued in a trading name rather than the name of an individual or a company, so it is not clear with whom Ms Stevens would have been contracting. Further, items of work were broadly defined, for example ‘fully renovate bathroom’, and were without plans or specifications. The invoices amount to offers to Ms Stevens, rather than concluded bargains, QBCC submits, and it is open to the tribunal to find that there is insufficient evidence of any contract or contracts.
[38]
While there is force in QBCC’s submissions on this point, on balance I consider that contracts were formed for the work in the invoices. The express terms set out in the invoices, such as the items of work and the prices, need to be supplemented by implied terms, such as that the work was to be carried out within a reasonable time. The invoices were signed by Mr Mar, and in the absence of evidence to the contrary, he (rather than one of his companies) should be regarded as party to the contract/s. The invoices include bank account details for direct deposits, so it can be inferred that the mutual agreement of the parties was that payments were to be made to that account (whether or not that occurred in practice).
[39]
I do not, however, accept Ms Stevens’ argument that there was just one overall contract.
[40]
Invoice 77 was issued on 12 January 2016, which was more than two weeks before the next invoice. Invoice 77 relates to the installation of airconditioning at the unit, for a total price of $9,500, comprising a ‘material payment’ of $7,500 and a balance of $2,000 ‘on completion’. Ms Stevens’ uncontested evidence is that she paid the $7,500 payment on 12 January 2016. The invoice dealt with a particular task namely installing airconditioning in the unit, and provided for a balance payment ‘on completion’. There is nothing on the face of the invoice, or in the surrounding circumstances, to indicate that the work was intended by the parties to be merely a stage in some larger contract for work. Like any contracting parties, Ms Stevens and Mr Mar could go on to enter further bargains, but nothing obliged them to do so. I find that invoice 77 evidences a stand-alone contract, made on 12 January 2016.
[41]
Similar observations can be made of invoice 84, dated 27 January 2016. It lists tasks to be carried out at the house. These include the supply and installation of airconditioning, painting of the interior of the house, replacement of the kitchen bench, and so on, for a total price of $44,000. The invoice provides for a ‘material payment’ of $24,000, then three progress payments each of $5,000, followed by ‘balance on completion’ of $5,000. Oddly, the third progress payment is said to be due ‘after painting unit’, but this must mean the house as there is no evidence of any agreement to paint the unit. Ms Stevens’ uncontested evidence is that she made payments totalling $24,000 on 27 January 2016, followed by payments totalling $17,000 on 29 January 2016, in connection with this invoice. The invoice relates to a discrete body of works: there is nothing in the invoice or in the circumstances to indicate that it necessarily formed just part of some larger contract. I find that invoice 84 evidences a stand-alone contract, made on 27 January 2016.
[42]
Invoice 85 is dated 2 February 2016. As I have mentioned, it is more difficult to interpret. It lists the addresses of both the house and the unit. It lists nine renovation tasks, without specifying which property they relate to, but Ms Stevens says they relate to the unit. The invoice does not list any prices for those items, but goes on to say:

Inv 84 & 85 $62,890.00

Less $41,000.00

------------

$21,890.00

Balance owing $21,890.00

$6,890 Paid 2/2/16

Balance $15,000.00

[43]
Ms Stevens’ evidence is that the parties had agreed by this point to delete the item ‘Replace kitchen bench with laminated top, new sink & tile splashback’ from the work to be done under invoice 84. I accept this, though I note that this is not stated in invoice 85. In my view, invoice 85 evidences a mutually-agreed variation to the invoice 84 contract, under which the parties agreed to delete the kitchen bench, sink and splashback item from the invoice 84 scope of works, add the nine items of work to be carried out at the unit, and add $18,890 to the overall cost.
[44]
Ultimately, then, I find that Ms Stevens entered into two contracts with Mr Mar: the first one on 12 January 2016 for the work listed in invoice 77, and a second one on 27 January 2016 for the work listed in invoice 84. The second contract was then varied by the parties on 2 February 2016, as discussed above.

Does an insurance policy apply to the first contract?

[45]
The first contract is the one for the work listed in invoice 77.
[46]
As neither Mr Mar nor his entities were licensed contractors, and the invoices did not show a building licence number, the only potential avenue for an insurance policy to arise would be through section 69(2)(a)(iii) of the QBCC Act.^[24]
[47]
The first contract was for the installation of airconditioning. Installation of airconditioning is not ‘primary building work’ as defined.^[25] As the first contract did not include any ‘primary building work’, the airconditioning is not ‘associated building work’ as defined.^[26] The first contract was therefore not one for the performance of ‘residential construction work’. Accordingly, a policy of insurance did not come into force in respect of that contract.
[48]
It follows that an insurance policy does not apply to the first contract.

Does an insurance policy apply to the second contract?

[49]
The second contract is the one entered into on 27 January 2016, as varied on 2 February 2016.
[50]
QBCC submits that it is doubtful that a policy arose because the fraudulent claim to hold a building licence made in the newspaper advertisement related to carrying out airconditioning installation work, and such work, alone, is not residential construction work. It was therefore, QBCC submits, not a claim ‘to hold a licence under which the person may enter into contracts with consumers to carry out residential construction work covered by the statutory insurance scheme’.^[27]
[51]
I do not accept this submission because airconditioning installation work is covered by the statutory insurance scheme when it is ‘associated building work’.
[52]
The work in the second contract included, for example, items falling within the category ‘building work for replacement or refitting of fixtures or fittings in a bathroom or kitchen …’.^[28] It therefore included ‘primary building work’, as well as ‘associated building work’ of installing airconditioning at the house. It is therefore a contract for the performance of residential construction work.
[53]
As the second contract was with Mr Mar, a person fraudulently claiming to hold a licence under which he could enter into contracts to carry out residential construction work covered by the statutory insurance scheme, a policy of insurance came into force in respect of the second contract.

Is QBCC liable under the policy applying to the second contract?

[54]
QBCC will be liable only if the contract is for a fixed price.^[29] QBCC submits that the second contract is not for a fixed price. Firstly, QBCC submits that some items in the invoices are so imprecise as to be inconsistent with a fixed price contract. For example, ‘fully renovate bathroom’, without any plans or specifications, describes a wide range of work and therefore a wide range of prices.
[55]
However, while I accept that such an item describes a wide range of work, I do not consider that the use of such an imprecise description prevents a contract from being a fixed price contract. There would be room for argument about whether work meets the description, but the argument would not be about the price itself. In the present case, the work of fully renovating the bathroom was required to be done within the overall price of $62,890.
[56]
Secondly, QBCC submits that the invoices contemplate additional cost such that the arrangement cannot be described as one for a fixed price. For example, invoice 84 lists the item: ‘Tile Patio. Included in price. But tiles chosen will be extra.’
[57]
The contract therefore clearly contemplates that there would be additional cost, yet to be quantified. There is no ‘provisional cost or sum’ provided for the tiles. Nor is there any ‘prime cost or sum’ indicated for the tiles. The tiles were to attract an ‘extra’ charge once chosen. The amount of the charge is not specified in any way or even estimated.
[58]
The inclusion of an item that would carry an unspecified future additional charge renders the contract one that is not for a fixed price.
[59]
Ms Stevens’ submission that ‘it is open to argue that specified extras were at the Applicant’s cost’^[30] does not solve the problem, in my view. The expression ‘tiles chosen will be extra’, in invoice 84, can be contrasted with the item ‘fit ceiling fans supplied by customer, 6 of’ in the same invoice. This indicates that Ms Stevens was to supply the fans, at her cost, whereas Mr Mar would be entitled to charge Ms Stevens an extra, as yet unspecified, amount, for the tiles. The fact that Ms Stevens would ultimately bear the cost for the tiles does not detract from the contractual entitlement of Mr Mar to charge her, in due course, for them.
[60]
While I accept that ambiguities in the legislation should be interpreted in Ms Stevens’ favour, I am not persuaded that a similar approach is warranted in the interpretation of the invoices. In any event, though, I do not consider that the invoices are ambiguous in any relevant respect. Further, I do not accept Ms Stevens’ submission that it is open to the tribunal to deem her to have met policy terms. There is no provision in the statutory scheme that enables such an approach.
[61]
Regardless of how events played out in relation to the supply of and payment for the tiles, the second contract, in calling for an unspecified future additional charge for the tiles, is not a contract for a fixed price.
[62]
Accordingly, QBCC is not liable under the insurance policy for loss caused by Mr Mar’s non-completion of the second contract.

Conclusion

[63]
As I have found that no insurance policy arises under the first contract, and that QBCC is not liable under the insurance policy arising in relation to the second contract, the correct and preferable decision is that Ms Stevens’ non-completion claim must be disallowed wholly.

Footnotes

[1]Queensland Building and Construction Commission Act 1991 (Qld) (‘QBCC Act’), s 67X(a). References in these reasons to the QBCC Act and the Queensland Building and Construction Commission Regulation 2003 (Qld) (‘QBCC Regulation’) are to the versions in force as at January and February 2016.

[2] QBCC Act, s 86(1)(h).

[3] QBCC Act, s 69(2)(a)(iii).

[4]Stevens v Queensland Building and Construction Commission [2018] QCAT 331.

[5] When the tribunal sets aside a reviewable decision, it can either substitute its own decision or return the matter to the decision-maker for reconsideration with directions the tribunal considers appropriate: Queensland Civil and Administrative Tribunal Act 2009 (Qld) (‘QCAT Act’), s 24(1).

[6] QBCC Act, s 69(2)(a).

[7] QCAT Act, s 23(4)(a).

[8] Ibid, s 20.

[9] QBCC Act, Schedule 2 (definition of ‘residential construction work’).

[10] Exhibit 1, tab 19, 14.

[11] Ibid, 44.

[12] Ibid, 47.

[13] Ibid, 42, 46.

[14] QBCC Act, Schedule 1B, s 1 (definition of ‘prime cost item’).

[15] Ibid, s 10.

[16] Exhibit 1, tab 14, 7.

[17] Ibid, 11.

[18] [2005] QDC 129, [15].

[19] Exhibit 1, tab 14, 7.

[20] See paragraph 21 above.

[21] QCAT Act, Schedule 3 (definition of ‘minor civil dispute’).

[22] Ibid, s 20(1).

[23]Codelfa Construction Pty Ltd v State Rail Authority of NSW [1982] HCA 24.

[24] Quoted in paragraph 19 above.

[25] See the definition in paragraph 20 above.

[26] Ibid.

[27] QBCC Act, s 69(2)(a)(iii).

[28] QBCC Regulation, s 11(2)(d).

[29] See paragraph 21 above.

[30] Exhibit 1, tab 14, 7.

Editorial Notes

Published Case Name:
Stevens v Queensland Building and Construction Commission
Shortened Case Name:
Stevens v Queensland Building and Construction Commission
MNC:
[2020] QCAT 355
Court:
QCAT
Judge(s):
Member Kanowski
Date:
09 Sep 2020

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Cases Cited List of Cases Cited by this judgment

Case Name	Full Citation	Frequency
Codelfa Construction Pty Ltd v State Rail Authority of New South Wales	View on:JADE(1982) HCA 24	1 citation Jump To Cite 1 - (1982) HCA 24
Queensland Building Services Authority v Fox	[2005] QDC 129	2 citations Jump To Cite 1 - [2005] QDC 129 Cite 2 - [2005] QDC 129
Stevens v Queensland Building and Construction Commission	[2018] QCAT 331	1 citation Jump To Cite 1 - [2018] QCAT 331

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Stevens v Queensland Building and Construction Commission[2020] QCAT 355