Clarey Builders v Queensland Building and Construction Commission
[2021] QCAT 289
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- Unreported Judgment
- Clarey Builders v Queensland Building and Construction Commission[2021] QCAT 289
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Clarey Builders v Queensland Building and Construction Commission[2021] QCAT 289
Clarey Builders v Queensland Building and Construction Commission[2021] QCAT 289
QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL
CITATION: | Clarey Builders v Queensland Building and Construction Commission [2021] QCAT 289 |
PARTIES: | PETER SELWYN CLAREY TRADING AS CLAREY BUILDERS (applicant) v QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION (respondent) |
APPLICATION NO: | GAR370-19 |
MATTER TYPE: | Building matter |
DELIVERED ON: | 20 August 2021 |
HEARING DATES: | 9 February 2021 and 10 February 2021 |
HEARD AT: | Townsville |
DECISION OF: | Member Pennell |
ORDER: | The decision of the Queensland Building and Construction Commission dated 6 September 2019 to issue Peter Selwyn Clarey trading as Clarey Builders with a Direction to Rectify No. 0105154 to rectify building work said to be defective or incomplete is confirmed. |
CATCHWORDS: | PROFESSIONS AND TRADES – BUILDERS – STATUTORY POWER TO REQUIRE RECTIFICATION OF DEFECTIVE OR INCOMPLETE BUILDING WORK – construction of a new house – the applicant was a licenced building contractor – the home owner commissioned his own design plans – the design plans were certified – the house was constructed in accordance with the certified plans – the house consisted of a deck adjacent to the living area – the applicant was aware the certified plans for the construction of the deck were non-compliant with the regulations – the home owner was aware of the defect in the certified plans for the deck – the home owner instructed the applicant to build the deck as per the certified plans – the applicant built the deck as per the certified plans – the deck was built without the mandatory drop off or fall away from the house – the home owner discovered a defect in the deck which caused water ingress – the home owner undertook rectification himself without advising the applicant – the home owner’s rectification of the defect was insufficient – the home owner sold the house without informing the new owners of the defect – the new owners discovered the water ingress defect – Category 1 defect – QBCC notified – the applicant is now retired and his construction business is no longer operating – direction to rectify issued – unfairness principle – the responsibility lies with a building contractor to ensure building work is undertaken according to the relevant regulations – by simply following certified plans does not relieve the building contractor of that responsibility Queensland Building and Construction Commission Act 1991 (Qld), s 3, s 3(a)(ii), s 3(b), s 72, s 72(3), s 72(5), s 87, Schedule 2, Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 18, s 19, s 20(2), s 24(1), s 28(2), s 28(3)(a). Dixon Projects Pty Ltd v Queensland Building Services Authority [2009] QCCTB 2 Don Mackay Pty Ltd v Queensland Building Services Authority [2009] QCCTB 259 Doolan v Queensland Building and Construction Commission [2017] QCAT 58 Drake v Minister for Immigration and Ethnic Affairs (1979) 24 ALR 577 Duke Building Pty Ltd v Queensland Building and Construction Commission & Ors [2015] QCAT 397 Fenfox Pty Ltd v Queensland Building and Construction Commission [2014] QCAT 664 Fontain v Queensland Building Services Authority [2004] QCCTB 163 Harold Terry v Queensland Building Services Authority [1995] QTB 55 JM Kelly (Project Builders) Pty Ltd v Queensland Building Services Authority [2010] QCAT 568 Kioa v West (1985) 159 CLR 550 Luscombe v Queensland Building and Construction Commission [2019] QCAT 13 Middleton v Queensland Building and Construction Commission [2018] QCAT 177 Queensland Building Services Authority v O'Brien & Ors [2002] QDC 329 R v His Honour Judge Miller and the Builders’ Registration Board of Queensland; ex-parte Graham Evans & Co (Qld) Pty Ltd [1987] 2 Qd R 446 Small v Building Services Corp [1988] 7 BCL 109 Wright and Anor v Duke Building Pty Ltd and Anor [2017] QCATA 35 |
APPEARANCES & REPRESENTATION: |
|
Applicant: | Self represented |
Respondent: | A Hewish, Solicitor, HWL Ebsworth Lawyers |
REASONS FOR DECISION
Introduction
- [1]On 12 July 2019, the Queensland Building and Construction Commission (‘the respondent’) issued Peter Selwyn Clarey (‘the applicant’) with a direction to rectify work on a house he constructed for Alan Gunders. That direction was made pursuant the Queensland Building and Construction Commission Act 1991 (Qld) (‘the QBCC Act’).[1]
- [2]When he built the house, the applicant was a licensed builder. He has since retired and at the time of being issued with the direction to rectify, his construction business was no longer operating.
- [3]The applicant sought an internal review of the respondent’s decision. Ultimately the respondent found the original decision should remain. Consequently, on 6 September 2019, the respondent issued the applicant with another notice to rectify work at the house.[2] It is this decision the applicant seeks to review.
The Tribunal’s role and legislative pathway
- [4]The applicant does not agree with the respondent’s decision to direct him to rectify the defect and the QBCC Act provides him with an opportunity to apply to the Tribunal for a review of that decision.[3]
- [5]The review is an administrative review undertaken at the Tribunal’s discretion. Proceedings for building matters are conducted subject to the provisions of the QBCC Act, the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (‘QCAT Act’) and the Queensland Civil and Administrative Tribunal Rules 2009 (Qld) (‘QCAT Rules’). When effecting that discretion, the Tribunal is obliged to employ fair procedures adapted to the circumstances of each particular case,[4] act fairly[5] and comply with the rules of natural justice.[6]
- [6]When undertaking a review of the respondent’s decision, the Tribunal effectively ‘stands in the shoes’ of the original decision maker,[7] and is generally obliged to have regard to the best and most current information available.[8] The review must be a fresh hearing on the merits of the application[9] and the question for the determination of the Tribunal is not whether the original decision was the correct or preferable one on the material before the original decision maker, but rather whether the Tribunal’s decision is the correct or preferable one based on the material before the Tribunal at the hearing.[10]
- [7]In arriving at a conclusion of what is the correct and preferable decision, there is a discretionary authority for the Tribunal to either confirm or amend the respondent’s decision; or set aside the respondent’s decision and substitute that decision with its own decision; or set aside the respondent’s decision and return the matter for consideration to the respondent with directions the Tribunal considers appropriate.[11]
Background
- [8]In August 2013, the applicant contracted with Alan Gunders to build a split level masonry block four-bedroom house in the Townsville suburb of Douglas. The house was to be constructed as per the plans and specifications supplied by Inspire Planning and Design. The principal of Inspire Planning and Design is Ian Darnell. He is related to Alan Gunders and the plans and specifications he drafted were as per the instructions given to him from Alan Gunders. With respect to all work embarked on for the installation of the plumbing and electricals, that work was undertaken by contractors who were personally acquainted with Alan Gunders.
- [9]Although the house was completed in July 2014, Alan Gunders never lived in it. He sold the house sometime in early 2015 through a local real estate agent. At some point prior to the sale of the property, the real estate agent notified him of a water stain on the ceiling of the garage, which is immediately below a timber deck. Alan Gunders did not notify the applicant about this defect.
- [10]Instead, he carried out his own inspection and repairs. He found that the quad moulding on the outside of the corner of the deck had no sealant behind it. He injected sealant into the gap behind the quad mould and removed grout from the line in the floor tiles above the join in the timber deck. This grout was replaced with sealant. He then painted over the water stain on the garage ceiling. He declined to tell the applicant about the defect; and nor did he inform the real estate agent or the subsequent buyer why the water stain existed on the garage ceiling.
- [11]Regardless of the repairs undertaken by Alan Gunders, the problems with the defect resurfaced later on. In April 2019, the current owners of the house became aware of water damage to the roof and walls below the decking. A complaint was made to the respondent about that defect.
- [12]An inspection was undertaken of the defect by the respondent’s building inspector[12] and an initial inspection report was compiled setting out a finding that the building work of the deck was defective. In part, the defects identified the floor from the living room to the decking did not have the required step down onto the deck of at least 50mm, and nor was there a minimum 1 mm:100 mm ratio fall away from the living area. This resulted in ponding of water on the deck. The deck had not been constructed in accordance with the manufacture’s installation guide and the tiling was defective. Overall, the assessment of the inspection was that the building work of the deck had failed, and consequential damage was caused by water ingress.
- [13]The applicant said that following practical completion of the house, he could recall only one occasion when Alan Gunders notified him of a defect which had to be rectified. This related to the replacement of a floor waste in the ensuite shower.[13]
- [14]The applicant said that Alan Gunders insisted that Inspire Planning and Services be used to draft the design plans and he had never met Ian Darnell, although he did recall that the only interaction between them was a brief phone conversation regarding the design of the deck. During that conversation, Ian Darnell assured him the design of the house was compliant with the Building Code of Australia and the Australian Standards. The only other contact he had with Ian Darnell was when he received the completed plans for construction of the house. Those plans were accompanied by the required Form 15 certifying the plans complied with the Building Code of Australia and the Australian Standards.
- [15]In his evidence, Alan Gunders claimed the applicant did not warn him of the potential drainage issues on the deck and the consequences that may flow from that. He also claimed he was not told of the requirement of a stepdown from the living area to the deck and the required fall away from the house.[14]
- [16]Although initially agreeing that he did not warn Alan Gunders that the deck was not compliant,[15] the applicant strayed from that comment in his sworn evidence at the Tribunal hearing. He told the Tribunal that he warned Alan Gunders of the pitfalls involved with respect to the deck’s drainage issues. However, he agreed that he did not warn him that the deck was not compliant because Alan Gunders already knew about the requirement of the step down, but wanted the house built as per the plans.
- [17]The applicant’s evidence about Alan Gunders being aware of the design defect was supported by Daniel Parison. He was the applicant’s apprentice and worked on the construction of the house with the applicant. He was present during a conversation between the applicant and Alan Gunders when the design defect relating to the fall of the deck was discussed. The applicant was trying to convince Alan Gunders of the requirement for a fall on the deck. Daniel Parison’s evidence on that point was not challenged and it supported the applicant’s position that Alan Gunders knew of the design defect.
The respondent’s position
- [18]The issues for the Tribunal to determine are whether the work undertaken was building work;[16] was the building work defective or incomplete; did the applicant carry out the building work; and would it be unfair to direct him to rectify the building work in the circumstances.[17] In respect to this matter, the only points that warrant discussion are whether the building work was defective, and should the Tribunal confirm the decision to issue the applicant with a direction to rectify any identified defect.
- [19]Building work means and includes the erection or construction of a building,[18] and for the purposes of this matter, the relevant building work is the deck. The respondent's policy relating to the rectification of building work confirms that a building contractor who carries out defective category 1 or category 2 building work should be required to rectify that work; unless in the circumstances the rectification would be unfair or unreasonable. Defective building work is defined to mean building work that is faulty or unsatisfactory. Category 1 defective building work is building work that is faulty or unsatisfactory because it adversely affects the structural performance of the building; or adversely affects the health or safety of persons residing in or occupying the building; or adversely affects the functional use of the building; or allows water penetration into the building. In this matter, there was no dispute that the defect fell within the definition just given.
- [20]The respondent said the building work undertaken by the applicant at the house was defective because the construction of the deck was unsatisfactory; the deck did not comply with either the Building Code of Australia or the Australian Standards; and it was not constructed and installed in accordance with the manufacturer's installation guide. In particular, the damage caused by the water penetration resulted from the applicant’s non-compliance with performance requirements provided within the Building Code of Australia and the Australian Standards.
- [21]Although the respondent accepts the house was constructed as per the design plans, the deck was defective for a number of reasons, including the absence of a step down of at least 50mm from the door sill level adjacent to the living area to the finished surface of the deck.[19] Rather, the finished height of the deck is located at or near the height of the interior floor level. In accordance with the Australian Standards and the manufacturer’s guide, decks are required to have a fall to prevent water being retained on the surface of the deck.[20] This fall was also absent. Neither of those points were disputed by the applicant.
- [22]In addition, the evidence of the respondent’s building inspector suggested the deck did not comply with the installation guide and the Australian Standards because its construction did not allow for sub-sill flashing or an upturn in the membrane between the level of the deck and the interior floor level at the doorway. This renders it non-compliant with the Building Code of Australia.[21] This was disputed by the applicant who said that there was an upturn in the membrane. On this point, the Tribunal accepts the respondent’s argument that the building inspector’s evidence should be preferred over the applicant’s because invasive testing had been undertaken which confirmed the membrane failed and caused the defect.
Discussion
- [23]Listed within the QBCC Act are the objectives the legislation strives to achieve. Along with providing remedies for defective work, the objectives also expressly provide, inter alia, that they exist to regulate the building industry; to ensure the maintenance of proper standards in the industry; and to regulate domestic building contracts to achieve a reasonable balance between the interests of building contractors and building owners.[22]
- [24]A direction to rectify is given for a number of reasons, including to ensure proper standards in the industry[23] and consumer protection is a primary purpose of the QBCC Act. It is the legislator’s intention that for reasons of consumer protection, the responsibility for defective building works sits squarely at the feet of the builder.
- [25]The core issue behind the respondent issuing the applicant with a direction to rectify the building work revolves around a suggestion that aside from the construction of the deck being undertaken as per the certified design plans, its construction did not comply with the Building Code of Australia or the Australian Standards. The applicant argued that notwithstanding he accepts the deck was not constructed according to those regulations, he should not be directed to rectify any defect because the plans provided to him were certified as complying with those regulations.
- [26]As to whether it is unfair to direct the applicant to rectify the building work in those circumstances, the Tribunal has to be satisfied that the giving of a direction to rectify would be unfair in all the circumstances.[24] The Tribunal has the discretion to consider all the circumstances which are reasonably relevant in each particular case,[25] and those circumstances may include the terms of the contract;[26] the competing interests of the parties;[27] the cause of the defective building work and the blameworthiness of the home owner.[28]
- [27]There was no contest the design plans were drafted according to what Alan Gunders wanted, and those plans were certified. Nor is it contested that a defect existed in the plans regarding the absence of a step down onto the deck from the house, and the required fall away in the level of the deck.
- [28]The applicant suggested that when he became aware of this defect, he personally expressed his concerns to Alan Gunders about the potential drainage issues. The applicant specifically recalled the conversation took place soon after Alan Gunders lost his job at the James Cook University and money became tight for him. Given that any change to the original plans would have taken time and extra money, Alan Gunders insisted the applicant go ahead with the construction of the deck according to the design plans. The applicant was adamant that Alan Gunders knew about the requirements relating to the fall and the step down onto the deck from the house. This is somewhat corroborated by the evidence of Daniel Parison as discussed earlier in these reasons.
- [29]There is a counter argument against this. Alan Gunders denied he was ever told of the potential drainage issues, notwithstanding the plans were drafted from information he provided to Ian Darnell. The actions undertaken by Alan Gunders when he discovered the defect, and the steps he took to conceal the defect from the ultimate buyer casts a shadow over his veracity. On the balance of probabilities, I am inclined to accept the applicant did tell Alan Gunders the design plans for the deck were not compliant.
- [30]Notwithstanding those competing positions, the applicant accepts the design plans for the deck were deficient. Regardless of the discussions that took place between him and Alan Gunders, the issue comes back to whether, after considering all the circumstances, would it be unfair to issue the applicant with a notice to rectify the defect.
- [31]The issue which arises is notwithstanding the applicant complied with his contractual obligations, the overall design of the deck was not his responsibility. Intermeshed in this, and insofar as contract law, the applicant did no wrong, but the outcome which resulted was the defective construction of the deck. When a building contractor’s work comes within the definition of building work that is faulty or unsatisfactory, this does not of itself impose any liability upon the building contractor, it merely enlivens the respondent’s discretion to give a direction to remedy the defective work. If the building contractor’s position is derived from adhering to a contract, then depending on the circumstances, it is within the respondent’s discretion whether the applicant should be directed to remedy the work.[29]
- [32]On previous occasions, the Tribunal and the various preceding Tribunals have recognised that a failure of a building contractor to meet relevant standards, such as the Building Code of Australia and Australian Standards amounts to defective building work[30] because it is the building contractor’s responsibility to ensure the building work complies with the relevant regulations. A building contractor is not excused from compliance with specifications of a regulatory body or a manufacturer’s specifications simply because an architect’s drawings were wrong,[31] regardless of whether the work was performed under the terms of the building contract.[32] Although design plans may be found to have been certificated, ultimately the responsibility for defective work lies with the building contractor.[33]
- [33]In its submissions, the respondent took the Tribunal’s attention to the case of Luscombe v Queensland Building and Construction Commission [2019] QCAT 13 (‘Luscombe’). Although there are some similarities between the applicant’s case and the particulars of Luscombe, there were also some distinguishing features.
- [34]In Luscombe the Tribunal set aside the respondent’s decision and said –
The present case, in my view, is one where on balance the discretion to order rectification should not be exercised. The deck was built in the way it was because of the express wishes of a knowledgeable owner, which were reflected in the approved drawings so far as set down is concerned. While valid criticism can be made of Mr Luscombe for persisting with the work out of loyalty to his friend even though he foresaw a problem, and for his failure to obtain written instructions, I consider that overall that it would be unfair in the circumstances to require Mr Luscombe to incur the expense involved in going back and changing these fundamental aspects of the construction.[34]
- [35]A distinguishing feature between Luscombe and the applicant’s case is that in Luscombe, the Tribunal was satisfied that although the deck was built as per the express wishes of the owner, and although the set down did not comply with the approved drawings, and the fall did not comply with the Australian Standards or the manufacturer’s recommendation, the Tribunal did not regard the deck flooring as faulty or unsatisfactory.[35] That is not the findings in this matter involving the applicant as it has been established the applicant’s building work was defective and consequential damage resulted from water ingress.
Conclusion
- [36]Ultimately the assessment for the Tribunal is whether by Alan Gunders wanting the deck built as per the certified plans exonerates or excuses the applicant from his obligation to comply with the Building Code of Australia and the Australian Standards and would it be unfair for a direction to rectify to be issued to him.
- [37]For the Tribunal to reach a conclusion that a notice to rectify a defect should be issued, it has to be satisfied that the giving of that notice is not unfair to the applicant.[36] Before arriving at that point, there must be some tangible evidence or some other compelling or otherwise extenuating circumstances which would allow the Tribunal to conclude that it should exercise its discretion to find that it would be unfair to direct the applicant to rectify the defect. There is no such evidence or circumstances which exists in this matter.
- [38]At the time the applicant constructed the house, he was a licensed contractor. As a licensed contractor, he was responsible for ensuring the building work was carried out in accordance with the relevant regulations and simply following approved building plans does not in itself relieve him of that responsibility.
- [39]Therefore, the Tribunal is satisfied that it would not be unfair for the applicant to be directed to rectify the defective work. The Tribunal’s correct and preferable decision is to confirm the respondent’s decision made on 6 September 2019 to issue the applicant with a notice to rectify the defective building work at the house he constructed for Alan Gunders.
Footnotes
[1] Queensland Building and Construction Commission Act 1991 (Qld), s 72.
[2] Direction to rectify and/or complete work numbered 0105154.
[3] Queensland Building and Construction Commission Act 1991 (Qld), s 87; Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 18.
[4] Kioa v West (1985) 159 CLR 550, 585.
[5] Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 28(2).
[6] Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 28(3)(a).
[7] Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 19.
[8] Shi v Migration Agents Registration Authority (2008) 235 CLR 286, 299.
[9] Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 20(2).
[10] Drake v Minister for Immigration and Ethnic Affairs (1979) 24 ALR 577, 589.
[11] Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 24(1).
[12] Inspection undertaken by Mr Kevin Cameron on 12/07/2019.
[13] Applicant’s statement dated 28/04/2020 at paragraph 9.
[14] Statement of Alan Gunders dated 31/03/2020 at page 2, paragraphs 13 – 14.
[15] Applicant’s statement dated 28/04/2020 at paragraph 6.
[16] Queensland Building and Construction Commission Act 1991 (Qld), s 72.
[17] Queensland Building and Construction Commission Act 1991 (Qld), s 72(5).
[18] Queensland Building and Construction Commission Act 1991 (Qld), Schedule 2.
[19] Statement of Kevin Cameron, KC-10, page 2 of 8 and page 5 of 8.
[20] A fall of at least 1 mm in every 100 mm.
[21] Building Code of Australia, Part 2.2.2.
[22] Queensland Building and Construction Commission Act 1991 (Qld), s 3.
[23] Don Mackay Pty Ltd v Queensland Building Services Authority [2009] QCCTB 259, followed in JM Kelly (Project Builders) Pty Ltd v Queensland Building Services Authority [2010] QCAT 568, [22].
[24] Queensland Building and Construction Commission Act 1991 (Qld), s 72(5).
[25] Queensland Building and Construction Commission Act 1991 (Qld), s 72(3).
[26] Doolan v Queensland Building and Construction Commission [2017] QCAT 58, [13].
[27] Stephenson v Queensland Building Services Authority [2005] QCCTB 59, [40].
[28] Duke Building Pty Ltd v Queensland Building and Construction Commission & Ors [2015] QCAT 397, [9]; R v His Honour Judge Miller and the Builders’ Registration Board of Queensland; ex-parte Graham Evans & Co (Qld) Pty Ltd [1987] 2 Qd R 446.
[29] Queensland Building Services Authority v O'Brien & Ors [2002] QDC 329, [42]; R v His Honour Judge Miller and the Builders’ Registration Board of Queensland; ex-parte Graham Evans & Co (Qld) Pty Ltd [1987] 2 Qd R 446, 458.
[30] Middleton v Queensland Building and Construction Commission [2018] QCAT 177, [27] in reference to previous decisions of Fontain v Queensland Building Services Authority [2004] QCCTB 163, Harold Terry v Queensland Building Services Authority [1995] QTB 55, Small v Building Services Corp [1988] 7 BCL 109.
[31] Fontain v Queensland Building Services Authority [2004] QCCTB 163, [15], [19] and Harold Terry v Queensland Building Services Authority [1995] QTB 55 as cited in Wright and Anor v Duke Building Pty Ltd and Anor [2017] QCATA 35, [121].
[32] Middleton v Queensland Building and Construction Commission [2018] QCAT 177, [47].
[33] Fenfox Pty Ltd v Queensland Building and Construction Commission [2014] QCAT 664, [24].
[34] Luscombe v Queensland Building and Construction Commission [2019] QCAT 13, [59].
[35] Luscombe v Queensland Building and Construction Commission [2019] QCAT 13, [57].
[36] Queensland Building and Construction Commission Act 1991 (Qld), s 72(5).