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Interlink Developments Pty Ltd v Queensland Building and Construction Commission[2021] QCAT 245

Interlink Developments Pty Ltd v Queensland Building and Construction Commission[2021] QCAT 245

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:

Interlink Developments Pty Ltd v Queensland Building and Construction Commission [2021] QCAT 245

PARTIES:

INTERLINK DEVELOPMENTS PTY LTD

(applicant)

v

QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION

(respondent)

APPLICATION NO/S:

GAR225-19

MATTER TYPE:

General administrative review matters

DELIVERED ON:

13 July 2021

HEARING DATES:

11 February 2021; 10 May 2021

HEARD AT:

Brisbane

DECISION OF:

Member Burke

ORDERS:

  1. The decision of the Queensland Building and Construction Commission of 22 May 2019 to issue Direction to Rectify No. 0104750 regarding complaint item number 2 is confirmed.
  2. The decision is stayed insofar as it requires work to be done, namely work required to address any leaking as referred to in complaint item number 2 of Direction to Rectify No. 0104750 on the basis that the Queensland Building and Construction Commission accepts that the leaking has been rectified.

CATCHWORDS:

PROFESSIONS AND TRADES – BUILDERS – STATUTORY POWER TO REQUIRE RECTIFICATION OF DEFECTIVE OR INCOMPLETE BUILDING WORK – nature of decision under review – in the context of a direction to rectify, whether decision to be considered as at time direction was issued or at time of review – whether direction unfair – whether owner denied proper access – where decision to issue direction to rectify confirmed.

Queensland Building and Construction Commission Act 1991 (Qld),  s 72, s 86, s 87

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 17, s 19, s 20, s 22, s 24

Interlink Developments Pty Ltd v Queensland Building and Construction Commission [2020] QCAT 480

Shi v Migration Agents Registration Authority (2008) 235 CLR 286; [2008] HCA 31

Paul Wayne Townsend v Queensland Building and Construction Commission [2019] QCAT 239

APPEARANCES & REPRESENTATION:

 

Applicant:

P, Coves Solicitor

Respondent:

S. Hedger, HWL Ebsworth Lawyers

REASONS FOR DECISION

  1. [1]
    Interlink Developments Pty Ltd (hereinafter referred to as “Interlink”) applied for a review of the decision of the Queensland Building and Construction Commission (hereinafter referred to as “the QBCC”) which is an internal review of the decision of the QBCC to issue a direction to rectify pursuant to s 72(2) of the Queensland Building and Construction Commission Act 1991 (Qld) (hereinafter referred to as the “QBCC Act”). [1]
  2. [2]
    The internal review decision of the QBCC was dated 22 May 2019 (“the internal review decision”).[2] The internal review decision confirmed the QBCC direction to rectify issued to Interlink on 5 April 2019 and determined that a direction to rectify should issue regarding item no. 2 in the complaint form submitted on 24 July 2018.
  3. [3]
    Interlink seeks a withdrawal of the direction to rectify based on the following reasons:
    1. (a)
      the issuing of the direction to rectify as part of the internal review decision was contrary to s 72(5) of the QBCC Act;
    2. (b)
      the internal review did not give consideration to the fact that access was not granted to Interlink prior to the QBCC attendance;
    3. (c)
      the QBCC inspector acted outside the QBCC policy by issuing the direction to rectify;
    4. (d)
      the QBCC inspector issued a direction to rectify on 5 April 2019 contrary to s 72(5);
    5. (e)
      while the defect has been attended to, and would have at all times been attended to, access was not granted by the owners and thus Interlink was prevented from carrying out the rectification work;
    6. (f)
      the QBCC inspector failed to consider evidence of service of requests for access.
  4. [4]
    Interlink seeks an order that the direction to rectify issued by the QBCC be set aside and that no further decision be made by this tribunal. Interlink also seeks its costs of the proceedings.

Background

  1. [5]
    On or about 23 June 2016, Urban Homes Pty Ltd entered into a Master Builders Residential Building contract – Level 2 (RBC-L2 07/2015) with Mr Nathan Mullan (hereinafter referred to as “the owner”) for the construction of a two level new dwelling at Hendra Queensland (hereinafter referred to as “the property”). Urban Homes Pty Ltd subsequently changed its name to Interlink on 22 August 2016.
  2. [6]
    Construction was completed on 27 May 2017.
  3. [7]
    The owner became aware of water penetrating the living room ceiling directly below the tiled deck area (hereinafter referred to as “complaint item number 2”) on 1 July 2018.
  4. [8]
    On 4 July 2018, the owner contacted Mr Maloney, the director of Interlink, to advise that three structural defects had become apparent. These included the following:
    1. (a)
      water penetration in the living room ceiling directly below the tiled deck area above;
    2. (b)
      a crack on the exterior wall adjacent to the butler’s pantry window;
    3. (c)
      buckling of the base board of the balustrading adjacent to the master bedroom causing a hump on the floor and squeaking of the sub-floor.
  5. [9]
    On 6 July 2018, Mr Maloney sent an email to the owner proposing a time to inspect the alleged defects.
  6. [10]
    On 9 July 2018, Mr Maloney sent a further email to the owner proposing a time to inspect the alleged defects.
  7. [11]
    On 13 July 2018, Mr Maloney sent a third email to the owner proposing Tuesday 17 July at 9am as a time to inspect the alleged defects. Mr Maloney outlined the QBCC’s generic policy regarding the issue of access and the obligations of both an owner and licensee.
  8. [12]
    On 24 July 2018, the owner submitted a residential and commercial construction complaint form to the QBCC outlining four complaints including the three complaints above and a further complaint regarding a defect in the ensuite cavity door.
  9. [13]
    On 31 July 2018, the QBCC advised the owner it had received the complaint and identified the next steps in the process in investigating the complaints.
  10. [14]
    Further on 31 July 2018, the QBCC emailed Interlink advising that a complaint had been submitted outlining the list of defects. The QBCC encouraged Interlink to contact the owner and take the opportunity to rectify the alleged defects prior to QBCC involvement. The QBCC requested evidence from Interlink in the event that Interlink believed it was not responsible for the defects or if the works were not defective as alleged.
  11. [15]
    On 31 July 2018, Mr Maloney responded to the QBCC by email advising that he had tried on several occasions to contact the owner by email and phone and that the owner had not granted access and refused to respond or return calls.
  12. [16]
    On 15 October 2018, the QBCC sent a request to the owner for an inspection to take place on 6 November 2018 at 10.45 am. The notice identified the purpose of the inspection and the steps which should be taken beforehand including allowing access to Interlink to rectify the works.
  13. [17]
    On 15 October 2018, the owner advised the QBCC that the date of 6 November was not suitable and requested a reschedule of the inspection until the new year.
  14. [18]
    On 19 October 2018, the QBCC advised both the owner and Interlink that the inspection had been rescheduled to 5 February 2019 at 9.30 am.
  15. [19]
    By email dated 24 October 2018, Mr Maloney requested the QBCC to advise what steps it intended to take at the inspection. Mr Maloney advised that access had not been granted on three occasions and thus access had been denied.
  16. [20]
    On 25 January 2019, the inspection was rescheduled for the same date being 5 February 2019 but changed to the time of 1pm.
  17. [21]
    Between 25 January 2019 and 31 January 2019, Mr Maloney of Interlink and Mr Scott Hayman, the QBCC building inspector, corresponded regarding the alleged denial of access.
  18. [22]
    By email dated 25 January 2019, Mr Hayman requested evidence of the owner’s denial of access.
  19. [23]
    On 25 January 2019, Mr Maloney advised the QBCC that the matter should be closed given the owner’s failure to respond to requests for access on 4, 9 and 13 July 2018 and the owner’s failure to respond to phone calls. Mr Maloney requested the matter be closed based on refusal to provide access. 
  20. [24]
    An initial inspection scheduled for 5 February 2019 was postponed by the QBCC to 5 March 2019 to afford Interlink an opportunity to obtain access and to undertake the rectification works.
  21. [25]
    Between 31 January 2019 and 1 February 2019, Mr Maloney of Interlink and Mr Hayman from the QBCC corresponded regarding the rescheduled inspection, with Mr Maloney stating that he had been denied access on three occasions and that he did not want the inspection to be delayed. Mr Hayman advised Mr Maloney that the inspection would proceed and that Interlink was able to gain access and rectify the work before that date.
  22. [26]
    On 6 February 2019, Mr Maloney contacted Mr Ferguson at the QBCC and advised that the file should be closed because he had requested access three times and the owner had failed to respond to emails which he could prove had been received and read.
  23. [27]
    On or about 13 February 2019, the owner exchanged emails with Mr Hayman from the QBCC regarding the re-scheduled access. Agreement was reached that Interlink could gain access anytime up until the date of the inspection on request to the owner.
  24. [28]
    On 4 March 2019, Mr Maloney advised the QBCC that he had been admitted to hospital and was unable to attend the inspection. He requested that the inspection be postponed. The owner was advised of Mr Maloney’s circumstances and stated that he would agree to the postponement but queried whether a medical certificate would be forthcoming to attest to the circumstances. On 8 March 2019, Mr Maloney provided a copy of his hospital discharge record.
  25. [29]
    On 13 March 2019, the QBCC attended the property to carry out an initial inspection of the items the subject of complaint. Photographs of the alleged defective works were provided by the owner to the QBCC.
  26. [30]
    A second inspection to carry out water testing of the alleged leaks was scheduled for 26 March 2019 and then re-scheduled for 3 April 2019.
  27. [31]
    On 3 April 2019, the QBCC attended the property to carry out a second inspection and water testing. The inspection was attended by Mr Hayman on behalf of the QBCC and a representative of Oasis National Property on behalf of the owner.
  28. [32]
    During the second inspection and water testing, thermal imaging was undertaken before and after water was applied to the sliding doors and deck area to determine whether water was entering the ceiling space.
  29. [33]
    On 3 April 2019, the QBCC produced an Initial Inspection Report (hereinafter referred to as “the initial inspection report”) which concluded that item 2 in the complaint form was defective building work and that a direction to rectify should be issued to Interlink.
  30. [34]
    On 5 April 2019, the QBCC issued Direction to Rectify and/or Complete Work No 0104578 to Interlink (hereinafter referred to as “the original DTR”). The direction stated that the installation of the upper level rear deck substrate, waterproof membrane and aluminium sliding doors was not in accordance with the Building Code of Australia 2016 Vol 2 3.8.1.3 nor Australian Standards AS4654.2:2012 causing water entry into the habitable space of the dwelling, damage to building elements and loss of amenity to the occupants. This direction was said to pertain to item 2 of the QBCC complaint form.
  31. [35]
    On 15 April 2019, Mr Maloney confirmed that Interlink had attended at the property and the defects had been attended to and the leak addressed and tested. Interlink applied silicone to the perimeter join and window/door frames of the balcony to remedy the alleged defect.
  32. [36]
    On 25 April 2019, Interlink submitted an internal review application to the QBCC to review the original DTR (hereinafter referred to as “the internal review application”).
  33. [37]
    On 1 May 2019, Mr Scott Hayman, building inspector with the QBCC, sent an email to Ms Debbie White, the senior internal review officer assigned to carry out the internal review, setting out his view in relation to the internal review of the matter.
  34. [38]
    On 1 May 2019, Ms White sought from Mr Wayne Blackman, a senior technical internal review officer with the QBCC, technical advice regarding the matter to assist her with her internal review process. Ms White set out specific queries from Mr Maloney and queried whether further testing was required to determine whether the work carried out by Interlink was defective.
  35. [39]
    On 3 May 2019, Ms White sought clarification from the owner regarding allegations of denial of access to Interlink. The owner responded to the request from the QBCC.
  36. [40]
    Subsequently, Mr Maloney provided to Mr Blackman video footage of the water testing carried out by the building inspector, Scott Hayman, at the previous inspection on 3 April 2019.
  37. [41]
    On 21 May 2019, the QBCC carried out a further inspection of the property and water testing at the property. A Site Inspection/Assessment Report prepared by Mr Wayne Blackman determined that the waterproofing was not compliant. Mr Blackman determined that the water testing confirmed that water penetration through the deck or around the perimeter of the deck and/or sills of the sliding door/s was occurring with water entering the ceiling cavity, slowly making its way into the dwelling through plasterboard ceilings. It was determined that the waterproofing did not comply with AS4654.2 or the Building Code of Australia (hereinafter referred to as “the BCA”).
  38. [42]
    On 22 May 2019, the QBCC issued its internal review decision which concluded that a direction to rectify should be issued to Interlink in relation to complaint item number 2 in the owner’s complaint form.
  39. [43]
    On 23 May 2019, the QBCC issued a further Direction to Rectify and/or Complete No 0104750 to give effect to the internal review decision (hereinafter referred to as “the second DTR”). The completion date for compliance with the second DTR was 25 June 2019.
  40. [44]
    On 23 May 2019, the QBCC advised the owner that the original complaint had progressed and identified the items in the original complaint which did not form part of the second DTR. In this respect, the QBCC advised the owner that Interlink had not been directed to rectify items 1, 3 and 4 of the original complaint. The QBCC provided the owner with a copy of the second DTR which pertained to complaint item 2 of the original complaint.
  41. [45]
    On 3 June and 11 June 2019, Interlink attended the property and removed the sliding doors, extended the waterproofing membrane over the sills of the door and re-installed the sliding doors. Mr Maloney says that to minimise the effect of the work, a 31mm gap was cut around the sliding doors and once replaced installed a 31mm x 31mm pink primed piece of timber. Interlink tested the deck for leaks and detected none.
  42. [46]
    On 12 June 2019, Interlink filed an application with the tribunal to review the internal review decision.
  43. [47]
    On 9 July 2019, the QBCC carried out a reinspection of the property and assessed whether there had been compliance with the second DTR.
  44. [48]
    The QBCC inspector produced a reinspection report on 10 July which determined that the building work remained defective and had not been satisfactorily rectified (hereinafter referred to as “the reinspection report”).

Statutory Framework

  1. [49]
    A review of an internal review decision of the QBCC may be undertaken by the tribunal by the combined operation of sections 86(1)(e) and 87 of the QBCC Act and s 17 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (hereinafter referred to as “the QCAT Act”).
  2. [50]
    A decision to give a direction to rectify or remedy or not to give the direction to rectify is a reviewable decision under s 86(1)(e) of the QBCC Act. A “direction to rectify or remedy” is defined to mean a direction given under s 72(2) of the QBCC Act.
  3. [51]
    A decision on an internal review of a reviewable decision is taken to be a reviewable decision for the purposes of an external review pursuant to s 86E(b) of the QBCC Act.
  4. [52]
    Section 87 of the QBCC Act provides that a person affected by a reviewable decision of the QBCC may apply, as provided under the QCAT Act, to the tribunal for a review of the decision.
  5. [53]
    The tribunal, in exercising its review jurisdiction, may make the following orders under s 24(1) of QCAT Act:
    1. (a)
      confirm or amend the decision;
    2. (b)
      set aside and substitute the decision with the tribunal’s own decision;
    3. (c)
      set aside and return the matter to the decision-maker for reconsideration of the decision with directions the tribunal considers appropriate.
  6. [54]
    The tribunal is required to arrive at the “correct and preferable” decision by way of a fresh hearing on the merits.[3] The task of the tribunal is not to assess whether the QBCC made the correct decision but to make the decision afresh standing in the shoes of the decision-maker.
  7. [55]
    In the review process, the tribunal is to take into account the objects of the QBCC Act and the powers of and limitations imposed on the QBCC in directing the rectification of defective works both under the QBCC Act and in accordance with QBCC Board imposed policies.
  8. [56]
    The objects of the QBCC Act are set out in s 3 of the QBCC Act. It provides, amongst other factors, that the objects of the Act are to regulate the building industry to ensure the maintenance of proper standards in the industry and to achieve a reasonable balance between the interests of building contractors and consumers and to provide remedies for defective building work.
  9. [57]
    Under s 71J of the QBCC Act, a consumer may request the QBCC to give a direction to rectify building work considered to be defective or incomplete. Details of the building work which the consumer considers to be defective or incomplete are to be provided to the QBCC. The request for a direction to be issued does not prevent the exercise of the power under s 72 being exercised by the QBCC.
  10. [58]
    Section 72 of the QBCC Act provides for the power of the QBCC to require rectification of defective works:

72 Power to require rectification of building work and remediation of consequential damage

  1. (1)
    This section applies if the commission is of the opinion that –
  1. (a)
    building work is defective or incomplete; or
  1. (b)
    consequential damage has been caused by, or as a consequence of, carrying out building work.
  1. (2)
    The commission may direct the person who carried out the building work to do the following within the period stated in the direction –
  1. (a)
    for building work that is defective or incomplete – rectify the building work;
  1. (b)
    for consequential damage – remedy the damage.
  1. (3)
    In deciding whether to give the direction, the commission may take into consideration all the circumstances it considers are reasonably relevant and, in particular, is not limited to a consideration of the terms of the contract for carrying out the building work (including the terms of any warranties included in the contract).
  1. (4)
    …………
  1. (5)
    The commission is not required to give the direction is the commission is satisfied that, in the circumstances, it would be unfair to the person to give the direction.

   Example for subsection (5) –

The commission might decide not to give a direction for the rectification of building work because an owner refuses to allow a building contractor to return to the owner’s home or because an owner’s failure to properly maintain a home has exacerbated the extent of defective building work carried out on the home.

  1. [59]
    The terms “building”, “building work’ and “defective” are defined in Schedule 2 of the QBCC Act.
  2. [60]
    Limitations on the power to issue a direction to rectify or remedy defective building work are set out in s 72A of the QBCC Act.
  3. [61]
    In exercising the discretion to direct building work, the QBCC (and therefore the tribunal) is required to consider and apply relevant policies.[4] Before 10 November 2017, the Queensland Building and Construction Board made and reviewed policies governing the administration of the QBCC Act.
  4. [62]
    One of those policies included the Rectification of Building Work Policy (hereinafter referred to as “the rectification policy”) which became effective on 10 October 2014.
  5. [63]
    The published policy provides that it is a policy of the Queensland Building and Construction Board that a building contractor who carries out defective building work should be required to rectify the work. Defective building work is defined as building work that is faulty or unsatisfactory and includes, for example, work that does not comply with the Building Act 1975 (Qld), Building Code of Australia or an applicable Australian Standard.

Preliminary Issues

  1. [64]
    Mr Coves, the solicitor representing Interlink, raised a number of matters during submissions which require consideration before embarking on a determination by this tribunal by way of a rehearing.
  2. [65]
    Apart from the substantive issue of whether the works were defective, three preliminary matters were raised by Mr Coves during his submissions:
    1. (a)
      the temporal approach to be taken by the tribunal;
    2. (b)
      the utility of issuing a direction to rectify when works had already been remedied or completed;
    3. (c)
      the balance of interests of the owner and the builder and the QBCC’s unfair attitude towards the builder compared to the owner.
  3. [66]
    Mr Coves submits that it is incumbent on the tribunal to take a temporally fluid approach when determining the correct or preferable decision to be made. In other words, the fact finding function of the tribunal in conducting a de novo merits review is not confined to the consideration of facts and circumstances existing at the time of the original decision-maker’s determination but rather encompasses the state of affairs existing at the time the tribunal carries out its review process.
  4. [67]
    The temporally fluid approach to be adopted by the tribunal has been set out in Townsend v Queensland Building and Construction Commission [2019] QCAT 239 and follows the analysis by the High Court in Shi v Migration Agents Registration Authority.[5]
  5. [68]
    In Shi v Migration Agents Registration Authority, Kiefel J held that the decision, and the statutory question it answers, should be identified with some precision, for it marks the boundaries of the review.[6]
  6. [69]
    For the purpose of exercising a discretion in this review, this tribunal shall embrace a temporally fluid approach by taking into account all relevant facts up until the date of the hearing of this matter. This method involves a consideration of all current available evidence directed to the question which the original decision-maker was bound to decide. That evidence does not include evidence of rectification work carried out by the builder after the decision under review, being a decision to issue a direction to rectify.
  7. [70]
    The principles applicable to the questions as to when are the merits of issuing a direction to rectify to be examined and upon what evidence is the tribunal to act have been set out in full in the decision of Member Traves in a decision involving Interlink in another application, namely Interlink Developments Pty Ltd v Queensland Building and Construction Commission [2020] QCAT 480 at [31] – [47]. Accordingly, there is no necessity for me to repeat those principles here but rather adopt them for the purposes of this review.
  8. [71]
    The main focus of the review process is to consider the same question as the original decision-maker and to determine whether, at the time the direction was issued, the correct and preferable decision was to issue or not to issue a direction to rectify.[7]
  9. [72]
    Mr Coves further submits that there is little utility in issuing a direction to rectify in circumstances where works have been remediated. Putting aside whether the works have in fact been rectified,[8] Mr Coves submits that there is no practical effect in issuing a direction to rectify in circumstances where Interlink is no longer trading and in circumstances where the works have been remedied. Mr Coves submits that any direction to rectify would amount to a hollow decision and would be ignoring the whole picture.
  10. [73]
    A similar scenario occurred in Townsend,[9] in circumstances where even though it was accepted that the works had been remedied, the works as erected by the builder were defective and in the circumstances the tribunal concluded it was appropriate to exercise its discretion to issue the direction to the builder.[10]
  11. [74]
    I intend to follow the approach of the tribunal member in Townsend and Oracle Building Corporation in exercising a discretion whether to issue a direction to rectify works which have already been remedied since the original direction to rectify issued by the QBCC.
  12. [75]
    Thirdly, Mr Coves submits that there has been a complete imbalance in the QBCC’s attitude towards the consumer and the builder. It is submitted that the QBCC dealt with the builder unfairly both in relation to access and re-scheduling inspections leading to a conclusion that to issue a further direction to rectify would perpetuate an unfair method of dealing with the parties. It is submitted that the QBCC has failed to balance the interests of the consumer and the builder.
  13. [76]
    Mr Coves submits that it would be unfair to issue the direction to rectify in circumstances where the owner did not permit the builder reasonable access.
  14. [77]
    It is accepted that such a circumstance may be regarded as a reason for a determination not to issue a direction to rectify, however each case must be reviewed on its own facts. It is not a strict limitation on the issue of a direction but rather a matter to be taken into account when determining whether the issue of a direction would be unfair.
  15. [78]
    I will consider fully the factual circumstances regarding the alleged failure to provide access by the owner and also the attitude of the QBCC towards Interlink in addressing the issue of whether it would be unfair to issue a direction to rectify.

Issues

  1. [79]
    The key issues for the tribunal to determine by way of a fresh hearing on the merits are as follows:
    1. (a)
      Was the work “building work”?
    2. (b)
      Was the building work defective or incomplete?
    3. (c)
      Was the building work carried out by Interlink?
    4. (d)
      Is it unfair to direct Interlink to rectify the building work in all the circumstances?

Building work

  1. [80]
    There is no dispute between the parties that the work was building work as defined.

Was the work carried out by Interlink?

  1. [81]
    There is no dispute that the works were carried out by Interlink.

Was the building work defective or incomplete?

  1. [82]
    The owner’s complaint in the complaint form was that water had penetrated the living room ceiling directly below the tiled deck area above. A faint water stain approximately 200mm long was visible approximately 300mm from where water dripping from the ceiling was evident.
  2. [83]
    Interlink disputes that the works carried out by it were defective and that there was non-compliance with the Australian Standards as set out in the second DTR.
  3. [84]
    Mr Coves submits that there are three issues to take into account:
    1. (a)
      the works were not defective or non-compliant with the Australian Standards;
    2. (b)
      the method of testing to determine whether the works were defective was not comparable to normal weather conditions;
    3. (c)
      the testing carried out by Mr Blackman, on behalf of the QBCC, was excessive and unreliable.
  4. [85]
    Mr Coves submits that, on the balance of probabilities, it must be concluded that the works were not defective under normal conditions. There can be no positive conclusion that the works were defective. It has been neither known nor proven that the works were defective as the high pressure techniques engaged to prove that water was penetrating the dwelling were not normal circumstances. Mr Coves submitted that any building would leak in the circumstances fabricated on the inspection.
  5. [86]
    Mr Tim Ryan, consulting engineer with Structerre Consulting, gave evidence on behalf of Interlink and provided a report dated 15 November 2019. Mr Ryan was unable to carry out a physical inspection of the property and relied upon information provided to him by Mr Maloney.
  6. [87]
    Mr Ryan concluded that:
    1. (a)
      any failure of the membrane system was not as a result of normal weather conditions nor by testing defined in AS4654.1;
    2. (b)
      the deck fall and membrane have been installed in accordance with the instructions provided by Mr Maloney and Mr Scriggins and comply with the James Hardie installation manual and AS4654.2 specification;
    3. (c)
      any failure is likely to be a result of the excessive water pressure of the pressure cleaner or extended direct hose;
    4. (d)
      the application of a high pressure hose is many times greater than that which a door or opening is designed to bear and a high pressure hose guarantees water entry;
    5. (e)
      the only way to assess the problem would be to demolish or remove sections of the door frame;
    6. (f)
      the duration and position of the hose is critical to assessing water entry.
  7. [88]
    Mr Maloney gave evidence of the information he provided to Mr Ryan in order to assist him in providing his report. Mr Maloney was present at the inspections when testing was carried out. He was firmly of the view that the testing did not recreate normal circumstances for water entry on the property.
  8. [89]
    An initial inspection report dated 3 April 2019 was prepared by Mr Scott Hayman after inspections held on 13 March and 3 April 2019. These inspections were attended by Mr Maloney, the owner Mr Mullan and Mr Hayman on behalf of the QBCC and others.
  9. [90]
    In relation to the second item of complaint, namely the penetration of water to the living room ceiling below the tiled deck, Mr Hayman concluded that:

a) the fibre cement substrate and waterproof membrane did not reach the underside of the aluminium door frame, i.e. the waterproof membrane extended only 10-15 mm above the finished tile level;

b) the detailing and installation of the aluminium sliding doors, waterproof membrane and substrate are not in accordance with AS4654.2-2012 Waterproofing Membranes for external above ground use – Design and installation 2.5.2 and 2.8;

c) no sub-sill flashing was included as part of the membrane system – 2.8.3(a);

d) the internal and external floor levels did not allow for a sufficient upturn, the membrane is not fixed under the sill and does not terminate into the stormwater system as none is installed – 2.8.3 (b);

e) the upward termination of the membrane is less than 50mm above the finished surface level – 2.8.1 and appendix A Table A1. Further, the height differential between the internal and external is insufficient to allow a complaint membrane upturn to be installed;

f) the fall in the finished surface is less that (sic) 1:100 – 2.5.2.

  1. [91]
    At the second inspection arranged for 3 April 2019, a water test was carried out applying water to the upper level rear deck to observe the performance of the waterproofing. The following results were noted by Mr Hayman:

a) water was applied to the sliding doors and deck area using a moderate spray;

b) a thermal imaging camera was used to record the application of water to the area revealing water entering into the ceiling space as a result of the defective construction of the upper level rear deck;

c) water was observed to emanate from the plasterboard ceiling after a period of 12.5 minutes;

  1. [92]
    Mr Blackman, a senior technical internal review officer with the QBCC, gave evidence in the form of a statement dated 14 January 2020 and oral evidence at the hearing.
  2. [93]
    Mr Blackman had received a request on 1 May 2019 from the Senior Internal Review Officer, Ms Debbie White, to conduct an inspection of the property and to carry out further water testing to assess whether defective building work existed following an application to review the QBCC decision to issue the original DTR on 5 April 2019.
  3. [94]
    Mr Blackman attended the site on 21 May 2019 in the presence of Mr Maloney, the owner Mr Mullan and another person representing the owner, Mr Lewthwaite.
  4. [95]
    After the site inspection and conducting water testing with a garden hose on 21 May 2019, Mr Blackman advised Ms White that: “the water testing confirmed that water penetration through the deck of (sic) around the perimeter of the deck and/or at the sills of sliding doors is occurring with water entering the ceiling cavity, slowing (sic) making its way into the dwelling through plasterboard ceilings…….”.
  5. [96]
    Mr Blackman produced a site inspection/assessment report on 21 May 2019 which concluded that the complaint item fell within the meaning of defective building work under the QBCC Act and that, in accordance with the QBCC rectification policy, the defective building work was to be identified as being structural defective building work. Mr Blackman reached the following conclusions:-
    1. (a)
      Sub-sill flashing has not been installed in compliance with clause 2.8.3(a) of AS4654.2.
    2. (b)
      The vertical distance between the finished floor level of the deck (i.e. tile surface) and the sill of sliding glass doors do not allow an upturn of the waterproofing membrane of sufficient height as specified within Table A1 of AS 4654.2. The waterproofing membrane is not fixed under the sliding glass floor sills and does not terminate in a stormwater drainage system. Compliance with Clause 2.8.3(b) of AS 4654.2 has therefore not been achieved.
    3. (c)
      The finished height of the waterproofing membrane upturn at the perimeter of the deck is not of sufficient height to achieve compliance with Table A1 and Clause 2.8.1.1 of AS 4654.2.
    4. (d)
      Water discharged onto the surface of the deck and/or around the sills of the sliding glass doors opening onto the deck enters the floor/ceiling cavity above the ground floor level living room. Water penetration into the floor/ceiling cavity is causing water damage to the painted plasterboard ceiling. Water penetration is also likely to result in deterioration of structural flooring timbers and may pose an electrical hazard.
    5. (e)
      The installation of the waterproofing membrane and flashing to sliding glass doors does not achieve compliance with Clause 3.8.1.3 of the BCA nor the requirements of performance requirement P2.2.2, Weatherproofing, of the BCA.
  6. [97]
    A further inspection was carried out on 9 July 2019 attended by Mr Scott Hayman, on behalf of the QBCC, the owner Mr Mullan and his representative Mr Lewthwaite and also Mr Maloney on behalf of Interlink.
  7. [98]
    A further reinspection report dated 10 July 2019 was prepared by Mr Hayman after Interlink had been given the opportunity to comply with the second DTR.
  8. [99]
    Mr Hayman accepted that Interlink had attended the site and carried out the following works:
    1. (a)
      temporary removal of two aluminium sliding doors to the upper level deck;
    2. (b)
      temporary removal of the lower extremity of weatherboards;
    3. (c)
      application of additional waterproof membrane to the threshold between the deck and internal floor areas by way of lapping onto the previous installation;
    4. (d)
      re-fitting of the aluminium doors;
    5. (e)
      refitting of weatherboards;
    6. (f)
      application of additional silicone sealant to the aluminium sliding door perimeter, including lower threshold;
    7. (g)
      application of additional silicone sealant to the floor tile to wall lining junction;
    8. (h)
      refitting of the timber threshold insert below the northern aluminium sliding door.
  9. [100]
    Mr Hayman noted on visual inspection that:
    1. (a)
      no sub-sill flashing was visible to the underside of either sliding door;
    2. (b)
      no waterstop angle is present to the rear extremity of the aluminium sliding doors for termination of the waterproof membrane;
    3. (c)
      the internal and external floor levels have not been adjusted, nor has a hob been constructed to mitigate this factor resulting in the upward termination of the membrane at the doors remaining less than 50mm in height;
    4. (d)
      the finished floor of the rear deck remained as previously observed and had not been adjusted for fall resulting in the fall remaining flatter than 1:100;
    5. (e)
      the condition of the rectification work was generally poor in that application of silicone sealant was unprofessional and disturbed areas had not been painted with a poor finish of the timber insert to the northern aluminium sliding door.
  10. [101]
    Mr Hayman further concluded that:
    1. (a)
      water from the site water source was applied to the external wall linings, aluminium sliding door frames, glazing, deck and associated connections of the upper level rear deck for a period of 15 mins. No liquid water was observed to egress internally nor was any detected with the use of thermal imaging equipment;
    2. (b)
      the detailing and installation of the aluminium sliding doors, waterproof membrane and substrate remain contrary to the requirements of AS 4564.2:2012 Waterproofing membranes for external above ground use – Design and installation 2.5.2 and 2.8 on the following basis:
      1. no sub-sill flashing is included as part of the membrane system – 2.8.3(a);
      2. the internal and external floor levels do not allow for sufficient upturn, the membrane is not fixed under the sill and does not terminate into the stormwater system as none is installed – 2.8.3(b);
      3. the upward termination of the membrane is less than 50mm above the finished surface level – 2.8.1.1 & Appendix A Table A1. The height differential between the internal and external is insufficient to allow a complaint membrane upturn to be installed;
      4. the fall in the finished surface is less than 1:100 – 2.5.2;
      5. no waterstop angle is provided to the rear extremity of the aluminium sliding doors.
  11. [102]
    Mr Hayman concluded:
    1. (a)
      Interlink had undertaken rectification work which had removed the consequence of the defective building work undertaken; i.e. removal of the water entry;
    2. (b)
      AS4564 Parts 1 & 2 form part of the Deemed-to-Satisfy provisions of the BCA 2016 Vol 2 Part 3.8 and compliance is therefore mandatory absent any approved and listed Performance Solution. The building work remains contrary to the BCA in that it does not meet the referenced standard AS4654;
    3. (c)
      Interlink’s failure to carry out rectification work in accordance with AS4564.2:2012 and contrary to the BCA 2016 Vol 2 3.8.1.3 results in the works not being carried out in accordance with the original DTR;
    4. (d)
      the aesthetic qualities of the rectification work are not of a reasonable standard.
  12. [103]
    There is no cogent evidence to contradict the evidence of either Mr Hayman or Mr Blackman.
  13. [104]
    I accept the evidence of Mr Ryan that it is not possible to fully identify all of the defects and the extent of and cause of water leaking from the deck unless demolition takes place.
  14. [105]
    Whilst I accept that demolition of the door frame would be the only way to conclusively determine the extent of the defects or cause of the water leak, I am satisfied that the conclusions reached by Mr Hayman and Mr Blackman, following inspections of the works and the testing carried out on inspections, are more compelling than the conclusions of Mr Ryan who did not have the benefit of a visual inspection.
  15. [106]
    Clause 3.8.1.3 of the Building Code of Australia states that the waterproofing membranes for external ground use must comply with AS4654 Parts 1 and 2.
  16. [107]
    AS4654.2-2012 provides that:
    1. (a)
      by clause 2.8.3(a), sub-sill flashing for doors and windows onto external waterproofed areas shall be included as part of the membrane system, as typically depicted in Figure 2.8;
    2. (b)
      by clause 2.8.1, the finished height of the membrane above the finished surface level shall be sufficient to prevent water, including wind driven, flowing over the top of the membrane (Note: Appendix A for information on termination heights);
    3. (c)
      by Table A1 in Appendix A, the minimum vertical upward termination for an N2 wind class site is 50mm;
    4. (d)
      by clause 2.8.3(b), where the internal and external finished floor levels do not allow an upturn, the membrane shall be fixed under the sill and terminate in the stormwater system, as typically depicted in Figure 2.9; and
    5. (e)
      by clause 2.8.1.3, the sheet membrane shall be finished with over-flashing or cover-flashing, as typically depicted in Figure 2.2.
  17. [108]
    Mr Maloney gave evidence that the method of installation of waterproofing was adequate even though he conceded that:
    1. (a)
      there was no sub-sill flashing installed under the sliding glass doors because the waterproofing membrane was installed to replace the flashing;
    2. (b)
      the required upturn of the waterproofing membrane was not evenly installed;
    3. (c)
      the waterproofing membrane was not fixed under the sliding glass door sills;
    4. (d)
      there was no metal over-flashing covering the membrane turn-up at the perimeter of the wall but the weatherboard replaced the flashing.
  18. [109]
    I have formed the view that, in relying upon the technical advice of Mr Blackman in particular, the waterproof membrane and aluminium sliding door were not installed in accordance with AS 4654.2-2012.
  19. [110]
    Mr Maloney’s main complaint centred around the method of testing engaged by the QBCC. Mr Maloney specifically objected to Mr Blackman’s use of a hose for approximately one hour and 20 minutes instead of a reasonable period of approximately 15 to 20 minutes to assess water penetration.
  20. [111]
    Mr Maloney and Mr Blackman gave opposing evidence in relation to the timing of the testing. Whilst I accept that Mr Blackman was on site for one hour and 20 minutes, I do not accept that the hose testing took up the entire time period of the inspection.
  21. [112]
    I do not accept that the QBCC inspections were conducted in a manner outside the parameters of proper methods of testing for water penetration.
  22. [113]
    I have formed the view that the works were defective and have continued to cause problems because of the inadequacy of the waterproofing membrane.
  23. [114]
    Accordingly, subject to my determination regarding the fairness of issuing a direction to rectify, I have formed the view that the works are defective and thus it is appropriate that a direction to rectify should issue. In the circumstances, the second DTR will not be set aside and the decision presently under review is confirmed.

Unfair to Issue Direction to Rectify

  1. [115]
    Pursuant to s 72(5) of the QBCC Act, the tribunal is not required to issue a direction to rectify if it is satisfied that, in the circumstances, it would be unfair to give the direction to the person who carried out the building work.
  2. [116]
    The main submission relied upon by Mr Coves, solicitor for Interlink, is that the original DTR should never have been issued because the owner had repeatedly denied Interlink access to attend to any alleged defects.
  3. [117]
    Mr Maloney gave both oral and written evidence outlining the emails which he sent to the owner in July 2018 requesting access to the property.
  4. [118]
    Mr Maloney says that the QBCC failed to follow its own policy requiring the owner to provide access and ignored his pleas that the owner had failed to respond to his requests for access to repair any alleged defects.
  5. [119]
    There seems no doubt that the emails were sent. The issue is whether the emails were received. The owner gave evidence that the emails had not been received. Mr Maloney gave evidence that the emails not only had been sent but that he was able to trace the receipt of the emails by the owner.
  6. [120]
    I am prepared to accept Mr Maloney’s evidence that the July 2018 emails were received by the owner on his computer. Whether Mr Mullan read those emails, there is some doubt. In any event subsequently, there does not appear to be a denial of access to Interlink by the owner or his representatives.
  7. [121]
    Mr Maloney’s main argument arises from the perceived attitude of the owner at the very start of the complaint period and the QBCC’s behaviour in allowing the owner to repeatedly reschedule inspection dates. Mr Maloney gave evidence of occasions when the owner was given a much more favourable response to a request for rescheduling compared with occasions when he advised the QBCC that the proposed inspection date was not suitable to him. This was the case particularly when he was hospitalised or too ill to attend.
  8. [122]
    Mr Maloney formed the view that Mr Hayman, the QBCC inspector, exhibited favouritism towards the owner with regards to rescheduling inspections and also in relation to the conduct of the matter on the whole.
  9. [123]
    There seems to have been a perceived imbalance in Mr Hayman’s attitude towards the owner compared with that to Mr Maloney but it is plausible that this was not intended or sinister in any respect.
  10. [124]
    It is not implausible that more leeway is given to an owner, particularly in circumstances where the property is tenanted, given that it is the owner who has initiated the complaint and it is the owner whose interests are initially paramount to start the process of rectification of alleged defects. That does not mean that the owner should be favoured in any way; it merely arises from the nature of the process.
  11. [125]
    Having said that, in circumstances where the builder is denied access, it may be unfair for the QBCC to issue a direction.
  12. [126]
    In the present circumstances, I do not think Mr Maloney was denied access. Every effort was made to accommodate both parties in organising a number of inspections over an extended period of time. I have formed the view that Mr Maloney was afforded procedural fairness in the process of being given an opportunity to rectify the alleged defective work for quite a period of many months.
  13. [127]
    It is an important object of the legislation that proper building standards be maintained. It is equally important to achieve a reasonable balance between the interests of building contractors and consumers. The objective of the maintenance of building standards is not necessarily compromised by not issuing a direction to rectify. Conversely, issuing a direction to rectify may not be striking a reasonable balance between the interests of the owner and the builder.
  14. [128]
    In the circumstances, is it fair to issue the direction to rectify?
  15. [129]
    I have formed the view that, on balance, it would not be unfair to issue the direction to Interlink for the following reasons:
    1. (a)
      pursuant to s 20(2) of the QCAT Act, the tribunal has carried out this review by conducting a fresh hearing on the merits having regard to all the evidence now before the tribunal. Both parties have been given every opportunity to present all relevant evidence and to address every aspect of the allegations of defective building work;
    2. (b)
      the overwhelming evidence is that there is a defect in the installation of the waterproofing which is causing the leak identified by the owner and that the works are defective in that they do not comply with the relevant Standards and Building Code;
    3. (c)
      whilst there have been substantial delays and various rescheduling issues in carrying out inspections of the property, I do not think that Interlink has been denied access or been given no opportunity to remedy the alleged defects;
    4. (d)
      whilst from time to time the QBCC has not afforded Interlink the same courtesy as the owner in readily accepting justification for rescheduling of inspection dates, I do not think Interlink was denied the opportunity to remedy the alleged defects.
  16. [130]
    Consistently with the objects of the QBCC Act, it is necessary that a direction to rectify be issued in relation to defective building work even though subsequently to the decision to issue the direction to rectify the builder has carried out some rectification work. For that reason, I do not accept that the items which have been rectified subsequently to the date of the decision should no longer be the subject of the direction to rectify. Having said that, I accept that there is no utility in requiring rectification of works which no longer require rectification.
  17. [131]
    Section 22 of the QCAT Act provides that the tribunal may, on application of a party or on its own initiative, make an order staying the operation of all or part of a reviewable decision if a proceeding for the review of the decision has started under the QCAT Act.
  18. [132]
    In those circumstances, the tribunal may make an order if it considers the order is desirable having regard to :
    1. (a)
      the interests of any person whose interests may be affected by the making of the order or the order not being made;
    2. (b)
      any submission made to the tribunal by the decision-maker for the reviewable decision;
    3. (c)
      the public interest.[11]
  19. [133]
    Given that I have formed the view that there is no utility in requiring rectification of works which have already been rectified, I propose that part of the decision, to the extent that it relates to the leaking of water resulting from the defective building work carried out by Interlink, should be stayed on the basis that the leaking issue has been resolved.
  20. [134]
    The result of this proposal is that there is a record that the works were defective at the time the original decision-maker determined that a direction to rectify should issue and that the works were not rectified in the required time under the statutory scheme. It records however that any leaking caused by the defective work has been rectified and accepted by the QBCC as being remedied by Interlink.

Conclusion

  1. [135]
    The decision of the QBCC dated 22 May 2019 to issue a direction to rectify to Interlink is confirmed.
  2. [136]
    To the extent that the decision relates to the rectification of works causing water entry into the habitable space of the dwelling, damage to building elements and loss of amenity to occupants, such part of the decision is stayed on the basis that it is agreed that the necessary rectification work to address the leaking water has been carried out by Interlink.

Footnotes

[1]  The application for review was filed 12 June 2019.

[2]  Case 409006 Internal Review SF0512987.

[3]  QCAT Act s 20.

[4] Imperial Homes (Queensland) Pty Ltd v Queensland Building and Construction Commission [2014] QCAT 42, [15], [47]- [49].

[5]  (2008) 235 CLR 286.

[6]  Ibid, [133].

[7] Frugtniet v Australian Securities and Investment Commission [2019] HCA 16; Comcare v Burton (1998) 157 ALR 522; Rust-Oleum Australia Pty Ltd v Australian Pesticides and Veterinary Medicines Authority (2017) 73 AAR 319.

[8]  The issue of whether the works have been rectified is in dispute. Whilst Interlink says the works have been rectified, the QBCC denies this to be the case.

[9]  [2019] QCAT 239, [64] - [80].

[10]  See also Oracle Building Corporation Pty Ltd v Queensland Building and Construction Commission [2020] QCAT 69 at [131] – [144].

[11]  QCAT Act s 22(4).

Close

Editorial Notes

  • Published Case Name:

    Interlink Developments Pty Ltd v Queensland Building and Construction Commission

  • Shortened Case Name:

    Interlink Developments Pty Ltd v Queensland Building and Construction Commission

  • MNC:

    [2021] QCAT 245

  • Court:

    QCAT

  • Judge(s):

    Member Burke

  • Date:

    13 Jul 2021

Appeal Status

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

Cases Cited

Case NameFull CitationFrequency
Comcare v Burton (1998) 157 ALR 522
1 citation
Jump To
Cite 1 - (1998) 157 ALR 522
Frugtniet v Australian Securities and Investments Commission [2019] HCA 16
1 citation
Jump To
Cite 1 - [2019] HCA 16
Imperial Homes (Queensland) Pty Ltd v Queensland Building and Construction Commission [2014] QCAT 42
1 citation
Jump To
Cite 1 - [2014] QCAT 42
Interlink Developments Pty Ltd v Queensland Building and Construction Commission [2020] QCAT 480
2 citations
Jump To
Cite 1 - [2020] QCAT 480
Cite 2 - [2020] QCAT 480
Oracle Building Corporation Pty Ltd v Queensland Building and Construction Commission [2020] QCAT 69
1 citation
Jump To
Cite 1 - [2020] QCAT 69
Paul Wayne Townsend v Queensland Building and Construction Commission [2019] QCAT 239
3 citations
Jump To
Cite 1 - [2019] QCAT 239
Cite 2 - [2019] QCAT 239
Cite 3 - [2019] QCAT 239
Rust-Oleum Australia Pty Ltd v Australian Pesticides and Veterinary Medicines Authority (2017) 73 AAR 319
1 citation
Jump To
Cite 1 - (2017) 73 AAR 319
Shi v Migration Agents Registration Authority (2008) 235 CLR 286
3 citations
Jump To
Cite 1 - (2008) 235 CLR 286
Cite 2 - (2008) 235 CLR 286
Cite 3 - (2008) 235 CLR 286
Shi v Migration Agents Registration Authority (2008) HCA 31
1 citation
Jump To
Cite 1 - (2008) HCA 31

Cases Citing

Case NameFull CitationFrequency
Horsfall v Queensland Building and Construction Commission & S Watson Pty Ltd t/as Eclipse Patios and Extensions [2023] QCAT 3462 citations
Kovacs v Queensland Building and Construction Commission [2025] QCAT 521 citation
1

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