Rainbow v Turkovic[2021] QCAT 441

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

REASONS FOR DECISION

1. [1]
   This dispute arises out of building work undertaken by Mr Rainbow (the builder) for Mr Turkovic and Dr Grogan (the Owners) at their home in Wilston.
2. [2]
   Mr Rainbow sues for breach of contract in relation to invoices that were issued but unpaid by Mr Turkovic and Dr Grogan. Alternatively, Mr Rainbow sues for the reasonable value of works performed for the Owners on a restitutionary basis by way of quantum meruit.
3. [3]
   Mr Rainbow’s claim on account of unpaid invoices is for $62, 251.46, as revised.^[1] The claim was revised following the two day hearing in the Tribunal when the builder conceded that he was not entitled to certain amounts he had been paid or had claimed he was owed.
4. [4]
   In addition, Mr Rainbow claims the following sums:

   1. (a)
      $3, 300.00 on account of the agreed percentage for overheads and profit due in respect of tiling works;
   2. (b)
      $4, 510.00 being the amount of fees and expenses charged in respect of the use of the applicant’s business overdraft facility;
   3. (c)
      $31, 400.00 being the amount that would have been paid to the applicant for overheads and profit had the contract not been unlawfully terminated;
   4. (d)
      $5, 500.00 in costs incurred in referring the dispute to the Queensland Building and Construction Commission; and
   5. (e)
      $325.00 for the filing fee.
5. [5]
   Mr Turkovic and Dr Grogan have counter-claimed against Mr Rainbow, seeking the payment of:

   1. (a)
      Damages for negligent works undertaken by Mr Rainbow and which had to be rectified by a subsequent builder ($90, 799.42 in total); and
   2. (b)
      A restitutionary claim in money had and received, relating to overpayments by them of invoices issued by Mr Rainbow, in some cases for work which they say was never performed ($11, 527.41).

Overview of the facts

6. [6]
   In January 2017 the Owners engaged a builder, Andrew Pty Ltd trading as Norcon Building and Constructions (‘Norcon’) to take over the renovation works from their original builder. The Norcon contract was terminated on 22 December 2017.
7. [7]
   On 15 December 2017 Dr Grogan and Mr Rainbow had an initial meeting to discuss the renovation works. The next day Dr Grogan emailed Mr Rainbow, enclosing a copy of the renovation plans of the house and some concept drawings.
8. [8]
   From 16 January 2018 to 4 April 2018 various emails were exchanged between the parties in relation to the works.
9. [9]
   On 28 April 2018 Mr Rainbow emailed Dr Grogan with a scope of works and scope of carpentry works.
10. [10]
    On 5 June 2018 Mr Rainbow emailed Dr Grogan a quotation.
11. [11]
    On 7 June 2018 Mr Rainbow provided to the Owners a scope of works and carpentry scope of works together with two copies of the Master Builders Residential Cost-Plus Level 2 contract.
12. [12]
    On 9 June 2018 Mr Rainbow provided another quotation in relation to the works in the amount of $546, 786.00.
13. [13]
    On 29 June 2018 Mr Rainbow provided an updated quotation in the amount of $834, 450.00, a scope of works and specifications for carpentry quoting the price of $87, 692.00.
14. [14]
    On 30 June 2018 a completed but unsigned Cost-Plus Contract together with a scope of works/quotation in the amount of $672, 200.30, a preliminaries document with additional charges in excess of $10, 000 and a “prime cost items schedule” in the amount of $90, 300 was provided to the Owners.
15. [15]
    On 2 July 2018 Mr Rainbow commenced work at the house. Mr Rainbow said that the scope of works changed after that due to changes requested or which needed to be done to progress the works.
16. [16]
    On 8 September 2018 Mr Rainbow provided Dr Grogan an updated quotation in the amount of $578, 304 which included carpentry in the amount of $95, 997.00 (plus a builder’s margin of $78, 859.63 and preliminaries of $14, 932.33).
17. [17]
    An updated quotation in relation to the carpentry was provided on 15 September 2018 in the sum of $65, 109.
18. [18]
    On 23 December 2018 Mr Rainbow emailed Dr Grogan a notice of suspension of the works, purportedly under a contract.
19. [19]
    On 30 January 2019 the Owners’ solicitors wrote to Mr Rainbow terminating the ‘arrangement’, meaning, in the words of the Owners, the arrangement for future performance of work.^[2]
20. [20]
    Between 1 March 2019 and 1 April 2019 the Owners engaged Olemus Pty Ltd, of which Rod Pym was manager and director, on a monthly agreement to complete the works. On 1 April 2019 Kino Constructions Pty Ltd undertook a property dilapidation report.
21. [21]
    By 1 December 2019 the works were complete, subject to minor rectifications which were completed on 1 January 2020.

The issues

22. [22]
    The following issues were raised by the parties to this dispute:

    1. (a)
       Does the Tribunal have jurisdiction to hear and determine the application?
    2. (b)
       Have the parties entered into a written contract?
    3. (c)
       If yes, has there been a breach of contract by the Owners in not paying invoices issued to them?
    4. (d)
       If yes, are the Owners liable in damages for breach of contract to the builder for unlawfully terminating the contract?
    5. (e)
       If no valid contract was entered into, can the builder claim a reasonable value for work performed on the basis of a quantum meruit?
    6. (f)
       Are the Owners entitled to damages for breach of the duty of care owed by the builder to them in negligence?
    7. (g)
       Are the respondents entitled to recover money paid to the builder by way of mistake?

The jurisdiction of the Tribunal

23. [23]
    The Tribunal has jurisdiction to hear and decide building disputes,^[3] which are defined in Schedule 2 to the Queensland Building and Construction Commission Act 1991 (Qld) (‘QBCC Act’) to include a domestic building dispute.^[4]
24. [24]
    A domestic building dispute includes:

    1. (a)
       a dispute between a building owner and building contractor relating to the performance of reviewable domestic work or a contract for the performance of reviewable domestic work; and
    2. (b)
       a claim or dispute in negligence related to the performance of reviewable domestic work.^[5]
25. [25]
    ‘Building owner’, in the case of domestic building contracts, means the person for whom domestic building work has been, is being, or is to be, carried out.^[6]
26. [26]
    ‘Building contractor’, in the case of domestic building contracts, means a person who:

    1. (a)
       carries out domestic building work;
    2. (b)
       manages the carrying out of domestic building work;
    3. (c)
       has carried out, or managed the carrying out of, domestic building work; or
    4. (d)
       intends to carry out, or manage the carrying out of, domestic building work.^[7]
27. [27]
    ‘Reviewable domestic work’ means domestic building work under s 4 of Schedule 1B (Domestic Building Contracts) of the QBBC Act.
28. [28]
    ‘Domestic building work’ is defined in s 4(1)(b) of Schedule 1B, relevantly, to include the renovation, alteration, extension, improvement or repair of a home which is not ‘excluded building work’.^[8]
29. [29]
    The Tribunal, in resolving the dispute, may exercise one or more of the powers set out in s 77 of the QBCC Act.
30. [30]
    I am satisfied that this dispute is between building Owners and a building contractor and that the subject of the dispute is ‘reviewable domestic work’ because it concerns work in relation to the renovation, improvement or extension of the respondents’ home. I am satisfied that there is either a claim or dispute between the parties relating to the performance of reviewable domestic work or in relation to a contract for that work or a claim or dispute between them in negligence relating to that work.
31. [31]
    I am satisfied that the parties’ claims against each other are each a ‘building dispute’ which is in the nature of a ‘domestic building dispute’. There is no dispute that the builder complied with the process established by the QBCC to resolve the dispute prior to filing the application for a building dispute in the Tribunal, as required by s 77(2) of the QBCC Act.^[9]
32. [32]
    Accordingly, I am satisfied that the Tribunal has jurisdiction to decide the application.

Was there a written contract

33. [33]
    The last updated quoted price of the works, provided after the works were commenced, was in excess of $500, 000. A domestic building contract where the contract price is more than $20, 000 is a level 2 regulated contract^[10] as is a cost plus contract where the total amount payable for the contracted services is reasonably estimated to be more than that amount.^[11]
34. [34]
    Section 14(2) of Schedule 1B of the QBCC Act provides that a level 2 regulated contract “must be in a written form, dated and signed by or on behalf of each of the parties to it.”
35. [35]
    Section 14(10) provides that:

The contract has effect only if it complies with subsection (2).

36. [36]
    There was no single contract document dated and bearing the signatures of the parties.
37. [37]
    A contract may be written but comprise an exchange of correspondence. Moreover, in appropriate cases it may be possible to apply s 14 of the Electronic Transactions (Queensland) Act 2001 (Qld) (‘ETA’) with the consequence that the requirement for a signature in the QBCC Act may be taken to be met by an email.^[12]
38. [38]
    In Vaiao v Sharkie^[13] Senior Member Brown held:

[22] Section 14 of the ETQ Act may be relied upon in appropriate cases to satisfy the requirements for a signature under s 59 of the Property Law Act 1974 (Qld). I see no reason why it would not be possible for a person, in an appropriate case, to rely on s 14 of the ETQ Act to satisfy the requirements of the QBCC Act that a regulated contract be in writing, dated and signed by the parties in circumstances where the agreement is contained in electronic communications.

[23] There is no evidence before the Tribunal that the parties consented to the use of electronic communications for the purposes of s 14(1)(c) of the ETQ Act. However in circumstances where parties have engaged in negotiation by email and, in particular, where an offer is made by email, then it is open to a court or tribunal to infer that consent has been given by conduct of the other party.

[24] The difficulty facing Mr and Mrs Vaiao is that the Facebook extract is, of itself, insufficient to satisfy the requirements for the formation of a contract. In my view the extract does not evince a clear acceptance of an offer by the Vaiaos. Nor are the terms of the agreement able to be determined, from the extract provided, with a ‘reasonable degree of certainty’.

39. [39]
    The consequence of the contract being of “no effect” is that the parties are unable to enforce any rights or obligations arising from the contract. This has been held to be the case even if the contract would have been binding but for provisions equivalent to s 14(10).^[14]  
40. [40]
    The Owners deny that any binding agreement is evidenced by the exchange of emails between the parties which occurred from around 16 December 2017 to 30 June 2018.^[15] Mr Rainbow submitted that there is evidence of an agreement that the parties entered into a contract substantially in the form of the Master Builder’s Queensland Cost-Plus Contract – Level 2 (Residential) and that the email exchange between them was a refinement of the scope of work that was to be carried out and the price to be paid for those works. Mr Rainbow refers to the following email sent to him by the Owners on 14 November 2018, which stated:

Can you please provide itemised bills for the bills that have been forwarded as requested. You’re last invoice contained 2 bills for the same job. Both were incorrect but I paid one any way although it was more than what was quoted. We agreed the difference be reimbursed.

We would like to meet on the weekend to discuss what is happening with the house. You are not attending the house at all, addressing nay requests we make, providing timelines and claim you will not continue working without a signed contract. We also need an updated signed contract that we can submit to our lawyer. We have held off on this as the estimated price keeps going up.

Youre (sic) concern over a signed contract is not relevant as you have commenced this job which legally is acceptance of the discussed contract by both parties. Please check the veracity of this statement if you like.

41. [41]
    Mr Rainbow submitted that the “discussed contract” was a reference to the Master Builders’ Cost-Plus Level 2 Contract (Residential) along with the updated scope of works and updated quote/price which the Owners had in their possession and that the email confirmed that the parties had entered into a binding contract. 
42. [42]
    The Owners submitted that the email does not evidence an agreement and that there was no acceptance of any contract or of any terms in the email. They submitted that the email referred to an “inaccurate belief by Dr Grogan that the parties were already bound to an enforceable agreement” and so could not have amounted to an electronic signature accepting the terms of a contract for the purposes of s 14(1) of the ETA. They submitted that this was in contrast to Stellard Pty Ltd v North Queensland Fuels Pty Ltd^[16] where the “acceptance email” unambiguously stated “[w]e accept the below offer…”.^[17]
43. [43]
    Section 14 of the ETA provides:

14 REQUIREMENT FOR SIGNATURE

(1) If, under a State law, a person’s signature is required, the requirement is taken to have been met for an electronic communication if—

(a) a method is used to identify the person and to indicate the person’s intention in relation to the information communicated; and

(b) the method used was either—

(i) as reliable as appropriate for the purposes for which the electronic communication was generated or communicated, having regard to all the circumstances, including any relevant agreement; or

(ii) proven in fact to have fulfilled the functions described in paragraph (a), by itself or together with further evidence; and

(c) the person to whom the signature is required to be given consents to the requirement being met by using the method mentioned in paragraph (a).

(2) The reference in subsection (1) to a law that requires a signature includes a reference to a law that provides consequences for the absence of a signature.

44. [44]
    In Stellard Pty Ltd v North Queensland Fuels Pty Ltd the learned Senior Member held:

There is no evidence before the Tribunal that the parties consented to the use of electronic communications for the purposes of s 14(1)(c) of the ETQ Act. However circumstances where parties have engaged in negotiation by email and, in particular, where an offer is made by email, that it is open to a court or tribunal to infer that consent has been given by the other party.

45. [45]
    The parties exchanged various emails from 16 December 2017 to 30 June 2018 about the scope of work and estimated price for the works. On 4 September 2018 an updated ‘quotation’ was provided for various items of work, which totalled $578, 304 plus a builder’s margin of $78, 859.63 and preliminaries of $14, 932.33. On 15 September 2018 an updated scope of works for carpentry was provided which totalled $95, 997.
46. [46]
    On 10 September 2018 there is an exchange between the parties regarding the status of the scope of work documents:

If you had no intention of using this contract as a base you should of said so in the beginning.

It was not a contract – the document was an ongoing estimate supplied to you as an update and until costing was finalised.

47. [47]
    As noted above, on 14 November 2018, the Owners sent an email to Mr Rainbow which stated, amongst other things:

Youre [sic] concern over a signed contract is not relevant as you have commenced this job which legally is acceptance of the discussed contract by both parties. Please check the veracity of this statement if you like.

48. [48]
    I accept the submissions of Mr Rainbow that the “discussed contract” was a reference to the unsigned copy of the Master Builders’ Cost-Plus Level 2 contract that was in the Owners’ possession, along with the updated price estimate and updated scope of works. 
49. [49]
    The completed but unsigned Cost-Plus Contract forwarded to the Owners immediately prior to the commencement date of 2 July 2018, and upon which Mr Rainbow relies, provided in item 32:

Item 32 Electronic Signatures

Have the parties consented to the use of electronic signatures? Yes [ ] No [X]

NOTE: The parties must first sign a separate ‘Consent to Electronic Communications and Signatures’ form if the parties agree to use electronic signatures. This form is available from Master Builders Queensland.

50. [50]
    There was cross inserted against ‘No’, indicating that the parties had not consented to the use of electronic signatures. Further, Mr Rainbow gave evidence that, in accordance with his usual practice, hard copies of the Cost-Plus Contract were left with the Owners for them to sign.
51. [51]
    In those circumstances, s 14 of the ETQ Act is not satisfied. It follows that the contract, even if otherwise constituted in a written form by an exchange of emails and accompanying documents, is not signed. I find therefore that there is no contract which satisfied the QBCC Act.
52. [52]
    It follows, that there can be no claim for damages for breach of contract on the basis put forward by Mr Rainbow. That part of his application is therefore dismissed. In particular, I disallow the claim for $4, 510 being for the fees and expenses charged in respect of Mr Rainbow’s business overdraft facility, the amount of $31, 400 being the agreed percentage for overheads and profits that would have been payable to Mr Rainbow had the contract not been terminated and $5, 500 being the amount of costs incurred in referring the dispute to the QBCC.^[18]

Recovery in restitution on the basis of quantum meruit

53. [53]
    In the alternative, Mr Rainbow seeks to recover a reasonable sum for work done for which he has not been paid, by way of restitution of a sum of money representing the reasonable value of work performed, enforceable by an action that has been described, following Pavey & Matthews Pty Ltd v Paul,^[19] as a non-contractual quantum meruit.
54. [54]
    The High Court in Pavey & Matthews held that the right to recover on a quantum meruit does not depend on an implied contract, but rather on a claim to restitution or one based on unjust enrichment.^[20] The basis for the action lies in the defendant’s acceptance of works performed by the party claiming a quantum meruit.^[21] It is not enough to show that the work was beneficial to the defendant.^[22]
55. [55]
    Mr Rainbow has claimed he is entitled to the “reasonable remuneration for the work carried out at the respondents’ request”.
56. [56]
    The parties accepted the proposition that, were the Tribunal to conclude that there was no contract or that the contract was of no effect, that Mr Rainbow was entitled to reasonable renumeration for the work carried out.
57. [57]
    The dispute between the parties was as to the adequacy or sufficiency of evidence required to prove the fair and reasonable value of the work and whether it was necessary, in order to establish a reasonable value, to do so by reference to an external standard, such as the market price of labour and materials.

How is the reasonable value of work to be determined

58. [58]
    Mr Rainbow referred to the “starting point” of valuing enrichment by way of an objective market price and submitted that, in considering what is the objective market price, that the issues are: to identify the actual costs, though that is not necessarily determinative and then to determine whether they were reasonably incurred. Mr Rainbow submitted that the conduct of the parties and site conditions were relevant to whether the reasonable sum should be higher or lower and that allowance should be made for disruption, prolongation and inefficient works. Also relevant, it was submitted, was that the project was a significant dwelling with multiple floors and was known to have been troubled from the start. Mr Rainbow submitted that he had provided evidence of the costs of the services actually provided, that the evidence was “factual not opinion” and sufficient for the Tribunal to assess whether the amount was fair and reasonable or to decide the amount that is fair and reasonable. Mr Rainbow submitted that Roude v Helwani^[23] was similar to this case, which allowed the builder’s quantum meruit claim on the basis of the builder’s own evidence.
59. [59]
    The Owners submitted that, as Mr Rainbow did not produce any objective evidence or other evidence in relation to the market value supporting the reasonable sum he claimed on a quantum meruit basis, that the claim should be rejected. Counsel for the Owners expressly objected, at the commencement of the hearing, to Mr Rainbow attempting to rely on evidence filed by him as expert evidence. Reference was made to QCAT Practice Direction No 4 of 2009 concerning expert evidence which, it was submitted, had not been complied with. Further, it was submitted that to allow the builder to purport to rely on expert evidence would be in breach of natural justice as the Owners had not had an opportunity to critique that evidence, nor would they have had an opportunity to respond with their own expert evidence.
60. [60]
    The Owners submitted that objective evidence of the market value of works is the paramount form of evidence which a plaintiff should use to support a quantum meruit claim, referring to Mann v Paterson Constructions Pty Ltd.^[24] Further, that a party may rely on evidence which is not objective only if:

    1. (a)
       no objective or market value evidence is available; and
    2. (b)
       it can be concluded that an amount sought is in fact a reasonable sum for the work performed, based on admissible evidence.
61. [61]
    The Owners submitted that there must be evidence before the Tribunal which concludes as a matter of fact that the amount was reasonable and that if the Tribunal cannot come to the conclusion of reasonableness based on the admissible evidence before it, the quantum meruit claim must fail. They submitted that Mr Rainbow had only provided evidence of the subjective cost incurred by him, that is, costs of services actually provided and that Mr Rainbow did not lead any evidence of reasonableness of the charges claimed. Alternatively, it was submitted, if the question of reasonableness of the charges is considered by the Tribunal on the available evidence, that those charges are not reasonable. Finally, because no evidence of the reasonableness of the builder’s charges was led, it was submitted that the builder was not required to be cross-examined on his opinion as to the reasonableness of the charges. The Owners relied, principally, on Roude v Helwani^[25] in support of their position.

Consideration

62. [62]
    Counsel for the Owners objected to Mr Rainbow giving evidence as to the reasonable value of works performed, but I allowed the evidence. By reason of his experience in the building industry, Mr Rainbow was qualified to give an expert opinion as to the reasonableness of the charges. The fact he was not called as an expert witness does not affect the admissibility of his evidence to the extent his opinions were based on his specialised knowledge.^[26] Further, non-compliance with QCAT Practice Direction No 4 is not a basis, on its own, to disallow an expert to give evidence.
63. [63]
    In Mann v Paterson Constructions Pty Ltd,^[27] Nettle, Gordon, and Edelman JJ stated as follows:

[203] In some circumstances, it is necessary or appropriate that the benefit of work to the defendant be determined without reference to a contract price. As Dixon J observed in South Australian Harbors Board v South Australian Gas Co, [(1934) [1934] HCA 45; 51 CLR 485 at 499 (Evatt and McTiernan JJ agreeing at 508); [1934] HCA 45] identification of ‘a fair and reasonable rate of remuneration, in other words a quantum meruit’, raises a ‘question of fact’, the answer to which ‘depends very much upon the methods of reasoning which are pursued’. Where the claim to quantum meruit is founded upon a contract which does not expressly fix a price for services, "usually" the value of those services will be "assessed by reference to charges commonly made by others for like services", unless no such standard is available [South Australian Harbors Board v South Australian Gas Co [1934] ArgusLawRp 81; (1934) 51 CLR 485 at 501 per Dixon J, see also at 490 per Starke J]. In such cases, practical necessity justifies the default application of an objective price derived from outside the contract which ordinarily depends on evidence of supply costs and market conditions [See Booker Industries Pty Ltd v Wilson Parking (Qld) Pty Ltd [1982] HCA 53; (1982) 149 CLR 600 at 616 per Brennan J; [1982] HCA 53].

[204] Equally, where the claim is founded on an obligation to pay for services rendered under a contract which is unenforceable, it has been held that "[o]rdinarily" the measure of restitution "will correspond to the fair value of the benefit provided (eg remuneration calculated at a reasonable rate for work actually done or the fair market value of materials supplied)"[Pavey & Matthews [1987] HCA 5; (1987) 162 CLR 221 at 263 per Deane J.] Prices stated in the contract are regarded as relevant, but they remain "evidence only, on the question of amount" [See Scarisbrick v Parkinson (1869) 20 LT 175 at 177 per Kelly CB; Ward v Griffiths Bros Ltd [1928] NSWStRp 29; (1928) 28 SR (NSW) 425 at 427 per Street CJ; Horton v Jones [1934] NSWStRp 32; (1934) 34 SR (NSW) 359 at 367-368 per Jordan CJ; Pavey & Matthews [1987] HCA 5; (1987) 162 CLR 221 at 236-238 per Brennan J, 250, 252, 257 per Deane J, 267-268 per Dawson J.] That approach is informed by a legal concern that direct application of the contract price would risk incoherence with the policy of the law rendering the contract unenforceable, although this will always require consideration of that policy.^[28]

64. [64]
    In Roude v Helwani^[29] it was held, referring to Dixon J’s reasons as adopted by Nettle, Gordon and Edelman JJ above, that assessing a reasonable rate of remuneration is a question of fact. Further, that reference to a charge “commonly made by others for like services” is a usual measure of assessment if such a standard is available.^[30] Roude considered Pavey & Matthews where Deane J referred to the “fair value of the benefit provided” and gave the following examples: remuneration calculated at a reasonable rate for work actually done or the fair market value of materials supplied. Deane J immediately went on to say that it will not always satisfy the requirements of good conscience and justice in determining what constitutes fair and just compensation, to only have reference to what would represent a fair remuneration for the work involved or a fair market value of materials supplied. Referring to Deane J’s reasons, White J in Roude observed:

Deane J did not say that assessment of the “fair value of the benefit provided” was to be determined only by reference to the fair market value of work done or materials supplied, thereby implying that in the absence of evidence of market value, a claimant could not prove the fair value of the benefit provided. The appellants’ contention to the contrary ignores the fact that the words in brackets were given only by way of example. It also ignores the fact that reference to the calculation of remuneration is to be determined according to what is reasonable, rather than by reference to a market.^[31]

65. [65]
    Was there sufficient evidence of the reasonableness of the Mr Rainbow’s charges?
66. [66]
    In Roude the builder was entitled to rely on his own evidence as to the reasonableness of his costings. The court distinguished Horley v Sector 7G Architecture Pty Ltd (in liq)^[32] where the builder purported to rely simply on the rates he had charged with no explanation in the invoice as to the works to which it related, the hours involved, the rates by which it was calculated or how the total sum had been calculated. The invoices had also been created years after the work had been completed.
67. [67]
    In Roude, detailed invoices had been prepared at the time of the work, and not for the purposes of litigation. The Magistrate also relied on plans and photographs of the house which was 5 bedrooms and 5 bathrooms and on the uncontested evidence of the builder, who had 30 years of experience, that the house had around 5 times the sub-circuits of an ordinary house that size, and twice as many air-conditioning units. The Court of Appeal referred to those findings by the primary judge and held:

[29] The appellants submitted that the respondent had adduced no evidence of a “market rate” and submitted that there was no evidence that the price charged by the respondent in his invoices was fair and reasonable. All that the invoices and the detailed schedule giving a detailed breakdown of the work done and, in some cases, setting out the methodology by which the amount charged was calculated, established, was the price that the respondent proposed to charge. That evidence, so it was submitted, was not capable of establishing a fair and reasonable market rate for the work done.

[30] The appellants submitted that the fact that the respondent was not challenged in cross-examination as to the reasonableness of his charges wrongly reversed the onus of proof. The onus was on the respondent to establish the reasonableness of his charges. The latter proposition can be accepted. It does not follow that either the primary judge or the magistrate reversed the onus of proof. The respondent had given evidence by affidavit (which was not objected to) that his charges were reasonable. There was nothing unreasonable about his charges on the face of the invoices and the detailed description of the work done. By reason of his experience in the industry the respondent was qualified to give an expert opinion as to the reasonableness of the charges (Evidence Act 1995 (NSW) s 79). The fact he was not called as an expert witness does not affect the admissibility of his evidence to the extent his opinions were based on his specialised knowledge (Yeats v Nominal Defendant [2004] NSWCA 259 at [12] and [35]; Sochorova v Durairaj [2020] QCA 158 at [23] and [37]-[40]). The opinion expressed, if objected to, would have been inadmissible. But the opinion was not objected to. If it had been, the respondent may have been allowed to give evidence that set out the basis for the opinion. By not objecting to the evidence, but being able to assert that it should be given little weight, counsel for the appellant made a tactical decision that could not be criticised. But it left some evidence that the respondent’s charges were reasonable.

[31] There was no error in the reasoning of either the magistrate or the primary judge in observing that the respondent was not cross-examined on that opinion.

[32] Because the opinion provided some evidence of the reasonableness of the respondent’s charges, there was no error of law in the magistrate’s finding that the charges were reasonable.

[33] There was further evidence for that finding in the failure of the appellants to dispute the reasonableness of the invoices. A failure to respond to a demand for payment may amount to an admission if there are circumstances which render it more reasonably probable that a person who denied liability for the claim would answer the claim than that he would not (L Shaddock & Associates Pty Ltd v Parramatta City Council (No. 1) [1981] HCA 59; (1981) 150 CLR 225 per Gibbs CJ at 230; [1981] HCA 59; Thomas v Hollier (1984) 156 CLR 152 per Gibbs CJ at 157; [1984] HCA 35; J D Heydon, Cross on Evidence at 33,435).

[34] The appellants submitted that before it could be found that the charges in the respondent’s invoices were fair and reasonable, the respondent had to prove what was a fair and reasonable market rate for the work done. Properly understood, none of the authorities relied upon establishes that proposition.^[33]

68. [68]
    The Owners submitted that Roude was distinguishable on the basis they had objected to Mr Rainbow giving expert evidence as to the reasonableness of his charges, and further, that the Owners had, in fact, disputed many of his charges. Further, the Owners submitted that it would be in breach of natural justice to allow Mr Rainbow to purport to rely on any expert evidence because they had not had a chance to critique it, nor respond with their own expert evidence.
69. [69]
    The Owners submitted that Mr Rainbow had not led any evidence of the reasonableness of the charges he sought to claim, not even in evidence in chief at the hearing. Further, that Roude is distinguishable for the following reasons:

    1. (a)
       the Owners allege the works are excessive in amount and defective in quality;
    2. (b)
       Dr Grogan’s evidence that she had longstanding challenges in understanding his invoicing methods;
    3. (c)
       the Owners have made a claim in negligence against Mr Rainbow;
    4. (d)
       there were no contemporaneous detailed schedules of works provided; and
    5. (e)
       Mr Rainbow had not provided (or even attempted to provide evidence) that the charges claimed were not excessive and not unreasonable; and
    6. (f)
       because no evidence of the reasonableness of Mr Rainbow’s charges was led, that he was not required to be cross-examined on his opinion as to the charge’s reasonableness.
70. [70]
    Mr Rainbow has relied on the invoices he submitted contemporaneously to the Owners which detailed the works done and the breakdown of pricing.
71. [71]
    The claim originally was for payment of the following invoices:

    1. (a)
       Invoice 330: $53, 495.57 (due on 22 December 2018);
    2. (b)
       Invoice 337: $11, 280.82 (due on 15 December 2018);
    3. (c)
       Invoice 338: $242.72 (due date of 15 December 2018).
72. [72]
    Invoice 324 (for $3, 939.51) was partly paid ($1, 285.63 was paid) but this appears to have been agreed between the parties.^[34]  Accordingly, I do not consider invoice 324 further.
73. [73]
    The amount originally claimed, after reconciliation of all invoices and payment, was $65, 845.64 plus $3, 300 being “the agreed percentage for overheads and profit due in respect of tiling works carried out at the premises”. The total claim in respect of moneys said to have been owing to Mr Rainbow but unpaid was $69, 145.64.^[35] Mr Rainbow also claimed interest in an amount to be determined from the date each of the sums comprised in the amount of $65, 845.64 became overdue until the date of payment or to such other date as the Tribunal determined.
74. [74]
    The amounts claimed to be unpaid on the above invoices listed in [69] above is $65, 019.11.
75. [75]
    Following the hearing Mr Rainbow revised his claim on account of unpaid invoices as follows:

76. [76]
    This part of my reasons deals only with the claim for unpaid payment claims. The items listed as credits will be considered when dealing with the counter-claim for restitution made by the Owners.

Mr Rainbow’s charges 

77. [77]
    Mr Rainbow relied on a schedule of labour charges in calculating his invoices which was on page 11 of the unsigned Cost Plus Contract – Level 2 – Residential.^[36] The schedule was as follows:

78. [78]
    The revised invoice 330 was for work done from 7 October 2018 to 11 November 2018. The invoice was for:

• waterproofing of all bathrooms and laundry ($4, 615.00);
• supply and installation of skirting/architrave/sills – 80% finished ($18, 729.83);
• deposit for internal stairs – invoice 27077 (as attached) ($4, 545.46);
• installation of 19 internal doors (4 still to do in pantry, laundry chute and subbasement) – 73% of total ($803.00);
• Excavation and rubbish removal (will require 2 more skips) ($7, 615.70);
• Scaffold hire ($5, 800);
• Replace decking board to upper level deck ($180)

Sub total - $42, 288.99

Margin + 15% - $6, 343.35

Sub-total - $48, 632.34

GST - $4, 863.23

Total - $53, 495.57

79. [79]
    Payment was due on 22 December 2018. Earlier iterations of the invoice had been further explained by emails of 19 November 2018 and 20 November 2018. The emails set out how various items in the invoice had been calculated and commented that, in the case of the doors, for example:

The installation of the doors was priced at $1100 in the original carpentry [quote] and the charge was for $803 which is extraordinarily cheap for hanging 19 doors. This would normally be around $100 per minimum.^[37]

80. [80]
    Invoice 337 was from 12 November 2018 to 8 December 2018 and was for work done from 12 December 2018 to 8 December 2018. The invoice was for:

• Bruce Fuller Pest Control (Invoice 4991) ($330)
• Bill Roach Electrical (Invoice 0965) ($1, 840)
• Adheseal – 3 x Burmuda Smart Wastes ($143.09)
• Carpentry – remove scotia for tiling (1 hour) ($50)
• Ideal stairs – inv (00027077) ($6, 554.55)

Sub-total ($8, 917.64)

Margin + 15% ($1, 337.65)

Subtotal: $10, 255.29

GST $1 025.53

Total: $11, 280.82

81. [81]
    This invoice was due on 15 December 2018. The invoice attached separate invoices from the pest control person; Bill Roach the electrician; Adheseal and Ideal Stairs
82. [82]
    I note that in the email of 20 November 2018 that Mr Rainbow sent to Dr Grogan he states:

You have been happy to only pay for quoted amounts but the (sic) when you feel the invoice is high you decide you want to only pay for actual cost +. The cost -plus contract clearly states that if I incur a cost you have to pay for it plus a margin.

83. [83]
    I note that the rates applied by the Owners’ later builder, Mr Pym, were agreed to by the Owners and exceeded the rates applied by Mr Rainbow.
84. [84]
    Mr Pym was cross-examined as follows:

Mr Birchall: …would you say that the costs that you submitted were reasonable rates in the market? You weren’t …paying particularly excessive rates in the market?

Mr Pym: No. Part of the offering that we make is – I’ve been using the same electrician for 10 years, the same plumber for five years – the guys that I work with, we get very competitive rates and any discounts I can achieve on items, we actually supply copies of the invoices or show the client. They get the benefit of my savings and just pay my margin on top of that. So it’s – there’s not reason for me to do anything other than just get the best price that I can for them because at the end of the day that’s – that’s who I work for.

Mr Birchall: And that’s your ongoing….

Mr Pym: That’s my role.

Mr Birchall: …reputation as a builder?

Mr Pym: Correct.

Mr Birchall: So, if your costs, your charges, are viewed as reasonable I don’t understand that you have had any dispute with the respondents on the completion of the project?

Mr Pym: No.

Mr Birchall: No issues over payment?

Mr Pym: No.

Mr Birchall: So, if the costs that you used to derive the value of work done were about the same as Mr Rainbow’s or in excess of Mr Rainbow’s, would you say that Mr Rainbow’s costs of doing the job were inherently unreasonable?

Mr Pym: No.

Mr Birchall: If I…suggested to you that if your electrician was $100 an hour and his was 95….?...That’s about…they’re reasonably on par, aren’t they?

Mr Pym: Correct.

Mr Birchall: And your $100 an hour has been paid without any – any issue over whether it was grossly overcharged or – so in principle if it – if that was – I’m just putting this to you…?

Mr Pym: Yep.

Mr Birchall: …as a proposition. If there was parity between those costs and if yours are reasonable his would logically be reasonable?

Mr Pym: Yes.^[38]

85. [85]
    In my opinion, there is sufficient evidence of the reasonableness of the invoices. There is the evidence constituted by the invoices themselves. There is the evidence of Mr Rainbow, that the charges were reasonable. And, of some importance, there is the evidence of Mr Pym, who was called by the Owners as an expert, and who gave evidence that his rates were higher than Mr Rainbow’s and that he regarded Mr Rainbow’s charges as reasonable.
86. [86]
    Further, no evidence to the contrary was called by the Owners.
87. [87]
    I therefore accept the evidence of Mr Rainbow as to the reasonable value of his charges for the work covered by invoices 330 and 337, those charges totalling $65, 019.11.
88. [88]
    I do not accept that Mr Rainbow is entitled to be paid invoice 338 for interest calculated on late payment at a rate of 10% “as per contract”. Given my findings relating to the non-existence of a contract, I refuse this claim.
89. [89]
    I find that Mr Rainbow is entitled to be paid the amount of $65, 019.11 by way of restitution for the fair and reasonable value of the work that he did but was not paid for, prior to termination.

The claim for damages for breach of contract

90. [90]
    Mr Rainbow, in addition to the amount claimed for unpaid invoices, has claimed damages consequent upon the Owners’ unlawful termination of the contract.
91. [91]
    Mr Rainbow submitted that he was entitled, under clause 16.1 of the contract, to suspend performance of the works for the Owners’ failure to make payment on time. The Owners then terminated. Mr Rainbow submitted that he was entitled to be put in the same position that he would have been but for the Owners’ breach.

Consideration

92. [92]
    Mr Rainbow is not entitled to sue for damages for breach of contract given the earlier finding that there was no enforceable contract between the parties. It follows that his claim for damages can not succeed.

The counter-application by the Owners 

93. [93]
    The Owners filed a counter application (also revised) seeking:

    1. (a)
       damages for negligence ($56, 058.42); and
    2. (b)
       recovery of money wrongly paid to Mr Rainbow.
94. [94]
    At the conclusion of the hearing the parties were directed to file an amended Table with columns by each party addressing the Owners’ counter-claim. The amended Table was filed in the Tribunal on 25 February 2021. All references to claimed amounts are to the revised amounts in this Table. I note that in some instances, amounts claimed were re-framed by the Owners as claims in restitution for money wrongly paid, rather than in negligence.^[39] I have also taken any changes of this nature into account.
95. [95]
    The Owners have the onus of proof in respect of the cross-claim.

    1. (a)
       Negligence claim by the Owners
96. [96]
    The Owners submit that Mr Rainbow owed them a duty of care and that the duty was breached in a number of respects, principally because a substantial amount of work undertaken by him was allegedly substandard and constituted a breach of the duty to exercise reasonable care and skill. The Owners submit that it is not necessary for them to rely on expert evidence or to prove a breach of code or regulation to establish negligence. The Owners rely on references in Mr Rainbow’s invoices to establish that the allegedly defective work was his work, and not the work of the previous builder, Norcon.
97. [97]
    Mr Rainbow submitted that, before a duty of care is owed to avoid economic loss, there must be ‘vulnerability’ in the sense required by the High Court in Perre v Apand Pty Ltd.^[40] Mr Rainbow submitted that the Owners, due to Dr Grogan having an Owner Builder permit and to the Owners being so involved in the project, were not ‘vulnerable’ and that there was, accordingly, no duty owed to them or reliance by them on Mr Rainbow. Mr Rainbow submitted that, in the event a duty of care was found to exist, that it extended only to works completed by Mr Rainbow^[41] and was not breached.

Consideration

98. [98]
    The relationship of professional licensed builder to a homeowner client is an established category of relationship where a duty of care is owed. That is because it is reasonably foreseeable that if care is not taken by the builder the client is likely to suffer loss and damage. The owner of a house, in the absence of evidence to the contrary, may be assumed to rely on a professional builder to carry out the work with care and skill and the builder generally accepts the responsibility arising from that reliance.^[42]
99. [99]
    I find that Mr Rainbow owed a duty of care to the Owners to perform the agreed work with all reasonable care and skill and to the standard to be expected of a licensed contractor.
100. [100]
     I turn to consider whether any of the work identified by the Owners as substandard was work done by Mr Rainbow or his sub-contractors, and if so, whether it was defective and not performed to the standard to be expected of a licensed contractor.
101. [101]
     In respect of the work found to have been negligently performed, the issue arises as to whether and, if so, what damages should be awarded to the Owners. The object of an award of damages in tort is to restore a party to the position they would have been in had the negligence not occurred. Damages may include the cost of rectification.
102. [102]
     The parties have relied on Mr Pym’s evidence about the cost of rectification of defective work. In some instances that evidence was criticised by Mr Rainbow for being for work over and above that which was necessary to correct the alleged defect. In other cases Mr Rainbow disputed that the work had been performed by him or by his subcontractors.
103. [103]
     I turn now to consider each alleged item of defective work. 

     1. External cladding
104. [104]
     This item is no longer pursued as an item in the Owners’ negligence claim but as an item alleged to have been charged for but not completed. The item now forms part of the Owners’ claim for restitution and is dealt with under that heading below.

2. Skirting/Architraves

105. [105]
     The Owners claim $10, 400 for replacing the skirting and architraves. The original claim for $13 000 for this item was reduced by 20% because the rectification works undertaken related to only 80% of Mr Pym’s original estimate.
106. [106]
     The Owners alleged that the surfaces had not been made even by Mr Rainbow in the first place, which was why the skirting was ultimately defective and needed to be replaced. They submitted, in particular, that the floor had not been levelled appropriately and the frame/plasterboard for the walls had not been packed and filled appropriately. Finally, the Owners alleged that the general finish was of a poor standard, including with unsightly gaps.
107. [107]
     Mr Turkovic gave evidence that the skirting installed by Mr Rainbow was not joined straight and parallel to the wall and floor. The complaint was that it left an unsightly gap which was too large to be sealed and painted.^[43] Dr Grogan gave evidence in the hearing that the skirting was unsightly and below the expected standard.
108. [108]
     Mr Pym gave evidence on behalf of the Owners that most of the skirting had to be removed in order to ‘gap-fill’ and put it back on.^[44] The dilapidation report of Kino Constructions provided on the one hand that “all skirting throughout the house will need to be removed and made good” and at other places indicates that architraves will need to be “packed out”, for example, around doors.^[45] The report also indicated that in a number of rooms, the skirting and architraves had not yet been installed. Mr Pym gave evidence that the problem was in the framing and that the skirting could “never be fixed to perfection without taking the walls down and correcting the framing” but that they chose to address the problem by taking the skirting off, packing it and then moulding it as best they could to the walls that were there.^[46] Mr Pym explained:

It was something that was…very troubling to Michelle when we first started. That was one of her main concerns…was that, and it was something that was just – we addressed it in that manner because of then – I guess it gave Michelle peace of mind that what we were doing was going forward in the direction she wanted the house.^[47]

109. [109]
     However, Mr Pym conceded in cross examination that another builder might reasonably have taken another course, in effect, fixing the defects with sealant and paint. Mr Pym agreed in cross-examination that any gaps, open joints and nail holes could be treated with filler prior to painting and that gaps and open joints would reasonably be expected. Mr Pym also said that if the skirtings and architraves had been inspected after filling, preparation and painting, that none of the disconformities would be visible.
110. [110]
     Mr Rainbow gave evidence that he was responsible for the installation of the plasterboard and the timber floors to the house and that he installed the skirting, effectively, on top of the timber floors and against the plasterboard.^[48] Mr Rainbow also admitted that before he installed the skirting he had concerns that some of the framing was not straight.^[49]
111. [111]
     Mr Rainbow submitted that filling, preparation and painting did not form part of his scope of work and would have been attended to by the Owners’ painter in the ordinary course of finishing the works. Mr Rainbow also submitted that the skirting and architraves were not defective on any reasonable, objective assessment by reference to applicable standards.
112. [112]
     I find that the installation of the skirting was defective work. While I accept that it may have been possible for some of the skirting issues to have been resolved by nailing, filling and painting, it is also clear from photographs attached to Mr Turkovic’s affidavit that there were instances where skirting was not joined and mitred evenly in the corners which, I also accept, could not have been corrected that way.^[50]
113. [113]
     On balance, I find that the work was reasonably required but not to the extent it was undertaken. I also must discount the claimed amount to take account of the plinth blocks which were an added feature and not work within Mr Rainbow’s scope of work.
114. [114]
     The Owners have claimed rectification costs of $10, 400 on the basis that this represents 80% of the cost of Mr Pym’s original estimate of $13, 000, which included the cost of work in addition to the rectification works. Doing the best I can, in view of the evidence that suggested that a lesser form of rectification may have satisfactorily resolved some of the issues with the skirting, and in view of the additional work involved in adding plinths between the skirting and the architraves, I allow an amount of $8, 000 for rectification of the skirting and architraves.

3.  Wiring (electrical feeder)

115. [115]
     The Owners claim $4, 800 for rectification work associated with rewiring and moving the internal fuse box, which they say was not installed in the location shown on the electrical plans. The estimate of the cost to move it was portioned from the invoice marked ET1 to Mr Turkovic’s affidavit dated 28 January 2021.
116. [116]
     Mr Rainbow denies the fuse box was installed in the wrong position. He submits that it was moved due to changes to the cabinet layout in the Butlers’ pantry which were later requested by the Owners.
117. [117]
     I accept Dr Grogan’s evidence that the electrical plan was not changed from the time of Mr Rainbow’s involvement. I accept that the Owners provided a copy of the electrical plan to Mr Rainbow under cover of an email dated 5 February 2018.^[51] However, Mr Rainbow submits that the electrical plan does not show the position of the fuse box. Mr Rainbow said that, as a consequence, he met with the Owners on site to discuss and agree the position of the fuse box. Mr Rainbow submits that the agreed position was within the Butler’s Pantry. Mr Rainbow said that he installed the fuse box in the agreed position and routed all electrical cables to that location.
118. [118]
     Mr Rainbow submits that at the time the position of the fuse box was agreed, that he did not have the cabinetry plan for the Butler’s Pantry and did not have that plan at any time prior to his arrangement with the Owners being terminated.
119. [119]
     There was no evidence as to the location of the fuse box on the electrical plan and I was unable to locate it on the electrical plans. Accordingly, I accept Mr Rainbow’s evidence that the plans did not show the position of the fuse box.
120. [120]
     I am not satisfied, on the material before me, that Mr Rainbow knew or should have known that the positioning of the fuse box conflicted with the positioning of the cabinetry in the Butler’s Pantry. There was no evidence that the Owners provided finalised cabinetry plans for the Butler’s Pantry prior to the fuse box being installed. There was also no evidence that those plans had, in fact, been finalised at the time the fuse box was installed. Indeed, the letter of suspension of works dated 23 December 2018 states in item 2(b)(x):

Cabinetry design and installation dates have not been provided by the Owners, which has caused significant delays to the completion of the architraves and skirting.

121. [121]
     Accordingly, this claim is refused.

4.  Rough in (electrical completion)

122. [122]
     The Owners claim $1, 500 for rectification work they say was required to complete the electrical rough in. They say the rough in was incomplete in the kitchenette and in the main kitchen and generally incomplete throughout the house.
123. [123]
     Mr Rainbow submitted that he completed rough in works in accordance with the Owners’ electrical plan issued on 5 February 2018 and that he invoiced only for the work actually carried out. Further, that, in any event, the Owners have not provided particulars of what work was incomplete and/or defective.
124. [124]
     The difficulty for the Owners in respect of this claim lies in the nature of the contract between them and Mr Rainbow. Mr Rainbow was engaged on a cost-plus basis.
125. [125]
     The Owners do not contend that a particular price was agreed for the electrical rough-in. If, for the moment, I accept that Mr Rainbow agreed to do the electrical rough-in on a cost-plus basis, but failed to complete the work in accordance with the plan, then the proper measure of damages is the difference between what it would have cost had Mr Rainbow complied with his contract and the amount which in fact the Owners paid to have the work done in accordance with the plans. That figure has never been articulated nor proven by the Owners and accordingly, I am unable to allow the claim.

5.  Oven circuit

126. [126]
     The Owners claim $ 3, 000 for the installation of an oven circuit. The Owners submitted that no oven circuit was installed, despite the electrical plans requiring an oven circuit to be installed and Mr Rainbow having charged for substantial electrical works to the kitchen, including for the “electrical rough in”. They say that Mr Rainbow undertook responsibility for the electrical works, that he reviewed the plans and included the plans in his estimate for pricing and that this pricing was eventually part of the invoices charged to the respondents.
127. [127]
     Mr Rainbow denied this claim and says that he installed cabling to the indicated position of the steam oven on the electrical plans provided to him. He submitted that that circuit was suitable for use in connection with either a steam oven or a conventional oven or both. Mr Rainbow submitted that ET1 (the invoice from Lederlec Electrical Contractors dated 15 April 2019) did not specifically identify an ‘oven circuit’ but merely described: (a) a circuit for an induction cooktop in upstairs kitchen and (b) a kitchenette circuit on the first floor which was not within Mr Rainbow’s scope of work. Further, Mr Rainbow submitted that even if the circuit was required by the plans, his failure to install it was incomplete work, not defective work. Further, that there is no reliable evidence of the cost of installation.
128. [128]
     Mr Rainbow admitted in cross-examination that the electrical plans showed provision for both a steam oven and a wall oven.^[52] I accept Mr Pym’s evidence that it is standard building practice for all houses to have a dedicated oven circuit.^[53] In my view, some of the cost of installation of the oven circuit is attributable to defective work, given Mr Pym’s evidence that a lot of time was spent looking for the existing oven circuit which should have been there.^[54] Further, it would presumably have been more cost effective to install the circuit at the time of the electrical rough-in, rather than later, after it had been completed.
129. [129]
     Accordingly, I allow $2, 000 for this item.

6.  Data wiring

130. [130]
     The Owners claim a revised amount of $2 500 for the data wiring said not to have been installed or “roughed in” in accordance with the electrical plans they provided to Mr Rainbow.
131. [131]
     Mr Rainbow submits that he completed the data wiring rough in and included the cost of those works and a margin in his invoicing. Mr Rainbow claims that he did not carry out any fit off of the TV or installation of data cables. Mr Rainbow says that the invoice relied upon by the Owners in support of this item refers to “fit off TV and data cables installed by other”. Mr Rainbow says that he has not claimed payment for the fit off of TV and data cables but was entitled to payment for the rough in, for which he claimed payment.
132. [132]
     There was some dispute as to whether pulling wires through for “fit-off” was part of the rough-in or part of the fit-off. Mr Pym gave evidence that it was part of the fit-off and Mr Turkovic ultimately agreed.^[55] I accept that the principle of rough-in is the installation of electrical wires that will otherwise be inaccessible after the wall linings have been put in place.
133. [133]
     There is no evidence that the rough-in that was completed was defective.
134. [134]
     Mr Rainbow claims he only charged for the rough-in work completed. However, I accept that rough-in work not completed at the time of the original rough-in, though provided for in the electrical plans, would likely cost more to be completed at a later time.
135. [135]
     It is unclear on the evidence how much of the claimed amount is attributable to that extra cost. I note that the omission of the oven circuit forms a separate claim. Moreover, Dr Grogan in her evidence said:

So the rough-in – we found out the rough-in wasn’t completed even though we were charged final rough-in. It wasn’t completed. Our electrician was unable to identify any wiring to the oven or the cooktop despite the fact that – and there was also not a feeder wire. There was also other lights that weren’t wired in. In fact, we had to – even though we were charged for it, we had to omit them from our electrical plan.

136. [136]
     It appears that the claim is that the respondent paid for final rough-in but the rough-in was not complete. The claim in negligence in relation to the extra costs incurred for rough-in has not been made out.
137. [137]
     Accordingly, this claim is refused.

7.  Carpentry, framing and battening

138. [138]
     The Owners claim a revised amount of $8, 200 for rectification work in relation to stringers on stairs installed throughout the house which were uneven and incompetently installed and for rectification work required in relation to doors they alleged were defective. This sum represents 40% of Mr Pym’s original estimate and the amount claimed by the Owners because the Owners conceded that roughly 60% of the works related to the basement for which Mr Rainbow was not responsible.
139. [139]
     Mr Pym gave evidence in relation to the stairs that went from the basement to the top of the house (3 storeys), that the stringers on the stairs were two different sizes and that, in order to Gyprock that, they had to batten and frame.^[56] 
140. [140]
     In relation to the stairs, Mr Rainbow submitted that they were installed as supplied by the specialist supplier and were installed as supplied. Mr Rainbow explained that the stairs were designed and fabricated with stringers of different sizes. The stringer that was to be installed against the internal wall was designed and made smaller than the opposite stringer. Mr Rainbow understood that the design was developed in this way due to the additional structural support that is provided by the internal walls. Further, Mr Rainbow submitted that the later works to the underside of the stairs, including battening and linings under the stairs and landings were works that Mr Rainbow would have carried out and for which he could have charged had his contract not been terminated and are therefore incomplete works, not defective works.
141. [141]
     There is insufficient evidence before me to prove the stairs were defective. I do not know, for example, whether the rationale as to why the stringers were different sizes was reasonable. Accordingly, I accept that the work done to the stairs by Mr Pym was due to the stairs being incomplete rather than defective. I refuse the claim as it relates to the cost of further work done to the stairs.
142. [142]
     The Owners gave evidence that the doors and windows were manufactured by Eden Made under a separate contract. Although the external doors were installed by the previous builder, Norcon, the Owners allege that the handles, locks and security bolts were to be installed by Mr Rainbow or by one of his subcontractors. The Owners said that the same arrangement applied to the internal doors. They say that Mr Rainbow engaged the sub-contractor SJH Carpentry to do the installation of the handles, locks and security bolts for both the external and internal doors and refer to an invoice for $5, 280 from SJH Carpentry dated 29 October 2018.^[57]
143. [143]
     The Owners also claim an additional sum (previously claimed as an overpayment) for $1, 275 being the cost of repairing doors which Mr Rainbow had installed. The sum comprises 10 hours for trimming and fixing doors ($600); replacing French doors to rumpus ($270) and upper level bedrooms ($202.50 x 2). They rely on an invoice from Black Wire Interiors (ET-13) as evidence of the cost of those rectification works.
144. [144]
     Mr Rainbow denied this claim and submitted that the doors were supplied under a separate agreement between the Owners and a third party and that the third party was responsible for installing the locks or striker plates prior to delivery to Mr Rainbow. Mr Rainbow maintains that he did not install any of the external doors.
145. [145]
     I accept that Mr Rainbow did not originally install the external doors. However, I accept the evidence of Mr Turkovic that Mr Rainbow did do some work to the external doors to bedroom 4 and bedroom 5 and to the external French doors on the patio^[58] and that 3 sets of doors had to be replaced because Mr Rainbow had cut them too short.
146. [146]
     I also accept that the installation of the locks or striker plates to the doors was not undertaken directly by him. The Owners admit that the installation of the hardware was originally the responsibility of the door manufacturer, Eden Made. However, it appears that another contractor, SJH Carpentry undertook that work and charged Eden Made for it. The Owners gave evidence that Eden Made paid the invoice of SJH Carpentry but that the majority of the work was never completed or had to be rectified.
147. [147]
     It is not clear who engaged SJH. Mr Rainbow claims they were engaged by Eden Made but the Owners submit they were engaged by Mr Rainbow. Even if I was to find that Mr Rainbow engaged SJH, given that the contractual responsibility for the doors and their installation ultimately rested with Eden Made, I find that they, not Mr Rainbow, were responsible for that work. I do not allow the claim associated with rectification of the installation of the hardware to the doors.
148. [148]
     I am also not able to conclude that Mr Rainbow installed the doors leading out to the front deck from the rumpus room which were replaced by Mr Pym. Nor am I satisfied that Mr Rainbow installed the doors leading from the bedrooms out to the decks at the front and rear of the property. These doors, four sets in total, were alleged to have gaps that were too wide between the doors and to have some rough cutting along the bottom of the doors. Mr Rainbow however claimed that he did not install any external doors and the doors described would appear to be external doors.
149. [149]
     Mr Rainbow cannot, therefore, be liable for the cost of hanging new front doors or for fitting striker plates to those doors or for the 4 sets of new doors from the bedrooms to the deck. Further, he cannot be liable for the cost of fixing locks and latches where required.
150. [150]
     Mr Rainbow stated in the amended agreed Table that he has claimed payment only for doors “actually fitted”. I assume that the doors fitted were internal doors. Mr Pym gave evidence for the Owners that, in relation to the internal doors, some were not opening and closing correctly. This included the cavity sliders which were jamming and needed to be re-framed. In relation to other internal doors Mr Pym said:

Some of the actual doors in the rooms that had been installed just needed to be squared, so make sure they didn’t jam, and there were also doors in the house where there was a particular design of the carpentry or the fit out that Michelle had where it was quite detailed, and the lines weren’t lining up correctly, so they had to be modified too, so when you walked into a room, you didn’t see two different heights on two different doors.^[59]

151. [151]
     Mr Rainbow is not, in my view, responsible for patching scratches or small holes as I am not satisfied that they were caused by a lack of reasonable care on his part. Further, the absence of a door stop to bedroom 4 is, in my view, incomplete work rather than defective work.
152. [152]
     Mr Rainbow is, however, liable for the cost of re-installing the cavity sliding doors which involved pulling the frames out and reinstalling them, for squaring up the internal doors that needed it and for modifying other more detailed doors so that there were not different heights on different doors. He is also liable for the cost of replacing the 3 sets of doors that were cut too short.
153. [153]
     There is, however, no specific sum for that work. Mr Pym gave a “round numbers” estimate that the works he did associated with the basement (for which Mr Rainbow is not liable) was approximately 60% of the total works claimed for this item. Mr Pym’s estimate for the works then, excluding the basement, would be approximately $8, 200. I note that Mr Rainbow charged $803 for “hanging 19 doors”. Mr Rainbow said that this was extraordinarily cheap and that it would normally cost around $100 per door minimum.^[60]
154. [154]
     Given I am only allowing the claim for internal doors including the re-framing of the cavity sliding door, I will allow $2, 000 for modifying the internal doors and $1000 for re-framing the cavity slider. I will also allow the cost of $675 for replacing 3 sets of doors.
155. [155]
     Accordingly, I allow $3, 675 for this item.

8.  Plumbing (western side)

156. [156]
     The Owners claim $4, 112.15^[61] for rectification work required in relation to the plumbing on the western side of the house which included shifting the plumbing works to a lower position to permit concrete paths, the construction of which would alleviate flooding. The Owners relied on the invoice from Ryano’s Plumbing and Gas Fitting Pty Ltd of 4 June 2019 for 11 hours of work in support of this claim.^[62] The Owners submitted that the works included all plumbing and storm water pipework on each side of the house, fit off of the house’s internal appliances and the installation of drainage pits to collect surface water, at the rear and left hand side of the house (western side), and for hot water and air conditioner drains. The Owners also relied on invoices supplied by Mr Pym’s plumber (ET-17 and ET-18) which they say indicated that: (a) the western side storm water drainage was too high and needed to be replaced or rectified; (b) forty appliances were still required to be fit off; and (c) all high and low level down pipes and sub drainage were incomplete or broken, requiring rectification. Dr Grogan gave evidence that the plans never changed and that Mr Rainbow knew that the house was to have a concrete path installed around it. The Owners conceded that part of the charges relating to plumbing was for aco pits on the eastern side of the house and that a nominal reduction in the sum claimed is appropriate.
157. [157]
     Mr Rainbow denied this claim and submitted that the Owners’ design and plans were changed to include a path around the house including new drainage points which rendered the previously installed stormwater pipes too high and which needed to be lowered. Mr Rainbow gave evidence that this was a change requested by the Owners.
158. [158]
     Mr Pym explained the extra plumbing works as follows:

The plumbing on the western side that had been connected at that point was plumbing that was connected to stormwater, so roof water coming down the gutters. The moment we started to address the water issues into the basement meant we had to capture all the water that was around the outside of the house to stop it getting into the house, and the only way to capture that water was to basically concrete around the entire house and put new drainage in all of that concreting, which meant shifting the stormwater pipes and the existing ones that were there when we arrived.^[63]

159. [159]
     Mr Pym was asked whether the extra concreting was on the original plans or whether it was a modification. Mr Pym answered that he did not know.^[64]
160. [160]
     However, Mr Pym gave the following evidence later:

Member: So you put new concrete paths in. They weren’t existing?

Mr Pym: No.

Member: To help alleviate the flooding problem?

Mr Pym: Yes. So we had to excavate around the entire perimeter of the property.

Member: Right. And because you needed to put concrete paths in, is that why you needed to redo the plumbing?

Mr Pym: Yeah. The plumbing was too high and we couldn’t find anyway we could solve the flooding issues under the house without fixing the levels around the outside of the house.^[65]

161. [161]
     Further, in cross-examination, Mr Pym said:

Mr Birchall: We’re not saying the work at the western side plumbing is defective; it’s just relative to the concrete path, it’s at the wrong height?

Mr Pym: It – that’s – it’s kind of a tough answer to give you an exact answer on that one. To address the water ingress downstairs in the house, we had to address multiple things, and that included that plumbing on the western side. It wasn’t where you add a positive membrane in the garage and hope for the best. It wasn’t that you’d lower the height of the plumbing on the western side and hope for the best. It was take a holistic approach and look at every possible source and address the whole lot in one hit and make sure that Ed and Michelle can move into a house that doesn’t leak.

Mr Birchall: So that’s right, isn’t it, that all of that was made necessary because of the requirement to treat that surface water and groundwater issue that was arising in the basement?

Mr Pym: Yeah. Absolutely.

Mr Birchall: So again, just for clarity, we’re not saying that the plumbing was constructed in a defective manner; it’s just that design or solution was not going to be consistent with the way that you decided to treat the groundwater issue?

Mr Pym: Yes.

Mr Birchall: And therefore, it required adjustment?

Mr Pym: Yep.

Mr Birchall: And if Mr Rainbow had come up with a different solution, he may or may not have been required to adjust that drainage one way or the other?

Mr Pym: Absolutely.^[66]

162. [162]
     The item in the invoice relied upon of Ryano’s Plumbing and Gas dated 5 July 2019 relevantly provides in relation to the amount of $4, 112.15 the following:

4/6/19: Removing and re installation of western side storm water drainage as it was to (sic) high. Includes supplying of (1) extra aco pit and stainless grate as we have removed the allowance of the 3 on the eastern side and installed 4 on the western side instead.

Materials

Labour 2 men 11 hours @ $95 each = $2 090

Labour 2 extra men 6 hours @ $95 each = $1140

Extra materials $882.15

163. [163]
     The Owners agreed there is no basis for the extra charges relating to the aco pit and grate on the western side. It is not clear how much of the labour and materials charged were for the pit and grate.
164. [164]
     I accept that the plumbing was lowered because there was no room to instal a concrete path down the western side of the house. The issue is whether the plumbing was “too high”, in a manner which, on the evidence, established that it was negligent to install it at the level that it was installed.
165. [165]
     Mr Rainbow said that the concrete path was not planned and that, in effect, the need to lower the plumbing arose after he left and for reasons that were not apparent at the time. I am unable to find, on the evidence before me, that the concrete paths were shown on the plans. However, I am satisfied that concrete along that side of the house was necessary for the placement of air-conditioners, hot water systems and a water tank and that Mr Rainbow knew this.
166. [166]
     An email of 26 June 2018 from Mr Rainbow to Michelle attached a scope of works which states:

Lay concrete slab down west side from water tank to front of house (approx. 30m3) - $2 550.

167. [167]
     This item also appeared in a later scope of works (carpentry) dated 15 September 2018.
168. [168]
     Mr Rainbow gave the following evidence in cross-examination:

Mr Amerena: But there was no mention of having to install concrete paths at the time you did your plumbing?

Mr Rainbow: No, no. Definitely not. Definitiely not. And that would make – that makes a big difference.

Mr Amerena: And without the concrete paths your plumbing…?

Mr Rainbow: Would have been fine, yes.

Mr Amerena: …was at an adequate height?

Mr Rainbow: Consequences of changing the plan after works has been done is that stuff has to be fixed.

Mr Amerena: In relation to – still on that issue with the western side plumbing, the concrete path was always going to be necessary because things like appliances, like air conditioners, and those sorts of things were going to be set there. That’s correct, isn’t it?

Mr Rainbow: There’s was a concrete – there was a section of concrete down the side of the house, yes.

Mr Amerena: And it was always going to be necessary?

Mr Rainbow: To a certain point down the side of the house, yes.

Mr Amerena: So you knew about it before your plumbers went int and installed…?

Mr Rainbow: Not about the path.^[67]

169. [169]
     Mr Rainbow gave evidence that when they put the plumbing in, that it was ready to have a slab put down the side with drainage points for hot water systems and drains for the air-conditioner and that it all ran out to the kerb. Mr Rainbow said that it was done to the relevant plumbing stormwater standard.^[68]
170. [170]
     I accept the evidence of Dr Grogan that the soil was above the level of the cladding at the time the plumbing was installed, which needed to be rectified in any event for termite protection. Dr Grogan gave evidence as follows:

Dr Grogan: But Blair Rainbow put the – he did the plumb – he put in the plumbing on the western side and the soil was above the level of the cladding Rod Pym had to take off the lower level of the cladding, you know, and get rid of the soil. It had to be dug down. Blair Rainbow would’ve had to do that to put the concrete slab down anyway. Do you know what I mean? This wasn’t new or unexpected…

Mr Amerena: But, well, the soil levels…?

Dr Grogan: Was above the cladding.

Mr Amerena: But I presume that was the case when Blair Rainbow started – commenced his work?

Dr Grogan: Yeah. But he didn’t take it down….And they put in the pipework too shallow. They didn’t compensate for the level of – or the distance of the soil above the cladding.^[69]

171. [171]
     I find that the soil should not have been at a level higher than the cladding and that the plumbing was installed too high as a consequence. Even if the plan for flood mitigation for the basement had not been determined at the time the plumbing was installed, the plumbing should have been installed lower to enable proper termite protection to be installed and so that the planned concrete slab (or even any concrete paths the Owners might wish to instal in the future) could be installed without having to redo the plumbing.
172. [172]
     Mr Pym gave evidence during the hearing that the $4, 112.15 was for work associated with both the western side plumbing and the eastern side plumbing. Further, that approximately $2, 000 of that sum was for “new work” whereas $2, 000 was for rectification work associated with both sides of the house, in other words, that $1, 000 was attributable to the cost of rectification works relating to the western side.
173. [173]
     I accept the evidence of Mr Pym and allow this item in the sum of $1 000.

9.  Plumbing (western side management)

174. [174]
     The Owners claim $5 000 for Mr Pym’s costs in managing the works in item 8 above which were described by Mr Pym as plumbing and excavation works which took roughly one week.
175. [175]
     Mr Rainbow denies this claim on the same basis as the claim in item 8 above.
176. [176]
     On the basis the works in excavating and concreting in fact related to both sides of the house and were also said by Mr Pym to include new work (50%) I will allow 25% of the management costs for the western side, namely $1 025.

10.  Plumbing ensuite

177. [177]
     The Owners claim $225.60 for re-alignment of the waste to the bath.
178. [178]
     Mr Pym gave evidence that the waste for the bath was in the wrong place. He said that the waste for the plumbing and the waste for the bath must line up and in this case, one was at the wrong end. He said that you couldn’t just spin the bath; the plumbing actually needed to be moved. Mr Pym also said that the bath was on site when they arrived.
179. [179]
     Mr Rainbow disputed this cost and submitted that the connection of the bath to the waste was indispensably necessary work forming part of the ensuite fit off, as opposed to the rough-in. Mr Rainbow said that he did not carry out the ensuite fit off and had not sought payment for it. Mr Rainbow submitted that if he had carried out the ensuite fit off he would have been entitled to charge for this work.
180. [180]
     Mr Rainbow admitted in cross examination to knowing where the plug for the bath was supposed to be from the specifications which he had been given. This is consistent with an email from Dr Grogan to Mr Rainbow on 14 March 2018 which attached the ‘specs’ for the whirlpool bath in their ensuite and the 2 freestanding baths in the other bathrooms.^[70] Although I agree that Mr Rainbow had not done the fit off, presumably if he had placed the plumbing at the correct end, Mr Pym’s plumber would not have taken two hours to cut through the floor to make adjustments to the plumbing.
181. [181]
     Accordingly, I allow the sum of $225.60.

11.  Repair pipe sabotage

182. [182]
     The Owners claim a revised amount of $1, 900^[71] for the cost of hiring a commercial camera to inspect pipe blockage, a jet rodding machine to break up the concrete and labour to assist person with the commercial camera and jet rod machine.^[72]
183. [183]
     Mr Rainbow denied this claim. He said the pipe was already blocked when he came to site and referred to invoice 3030 which showed that a camera was hired to have an assessment done in around April 2018 and that allowances were made in the plumbing scope of work to replace the eastern side pipework including that portion of pipe which was blocked by concrete. Mr Rainbow described the pipe as “all it was a pipe in the ground with no connections for any of the storm water pipes from the gutter or any pits or anything else”.^[73] Mr Rainbow also said that the pipe had to be dug up and that it was included in the plumbing quote. Mr Rainbow gave evidence that because it was going to be dug up anyway and because, in effect, the pipe had no utility, he did not tell the Owners about the concrete. Mr Rainbow said that the concrete was there before he started work and “strongly disagreed” and took offence at the suggestion that he may have been responsible for it. Further, Mr Rainbow said that he did not carry out any concrete works on the site and cannot have been reckless as alleged or at all.
184. [184]
     Dr Grogan gave evidence in the context of explaining how they came to engage Mr Rainbow, that the builder they had engaged before Mr Rainbow had developed mental health issues and had started damaging the property. Dr Grogan said, in relation to that builder, that he “had to seek admission actually”.^[74]
185. [185]
     I am not prepared to find that the concrete was deliberately placed in the storm water pipe by Mr Rainbow as the Owners alleged. There is also no evidence that it was placed there either due to a deliberate act or lack of reasonable care by Mr Rainbow. Mr Rainbow swore under oath that the concrete was already there when he commenced working on the site. This possibility was not discounted and there was no evidence to the contrary. Indeed, given Dr Grogan’s evidence in relation to the former builder deliberately damaging their property, there is another more plausible explanation for the existence of the concrete. Further, most, if not all, of the concreting had been done by the previous builder. I accept Mr Rainbow’s evidence that he did not place the concrete in the pipe. There is no evidence to suggest that he did. I also consider it inherently unlikely that Mr Rainbow would sabotage a pipe that he assumed was being dug up in the course of the replacement of the stormwater system and which was not otherwise connected to anything else.
186. [186]
     Accordingly, I do not allow this claim. 

12.  Rebuild fireplace x 2

187. [187]
     The Owners’ claim, as revised, is for $5, 200 to remove and re-install the fireplace framework to avoid a fire hazard and to reinstall the fireboxes and to remove outer sheeting to replace with specified 9mm sheeting.
188. [188]
     Mr Rainbow submitted that the fireplaces were re-framed twice by Mr Pym after Mr Rainbow’s contract was terminated and that there was no fire hazard or, if there was, it could be rectified by a minor adjustment to the framing which fell well short of demolition and rebuilding. In any event, Mr Rainbow submitted that the framework had to be rebuilt to accommodate Dr Grogan’s late choice of cladding material, namely sandstone which was heavy. Mr Rainbow said that there was no specification for the sheeting of the chimney above roof level and, therefore, no basis upon which the works could be considered defective.
189. [189]
     Dr Grogan forwarded an email about the fireplaces to Mr Rainbow on 16 January 2018.^[75] The email forwarded an email she and her former builder had been sent from her friend, Melissa, on 19 October 2017. The email from Melissa recommended the Jetmaster 850 Open Gas Universal Firebox and attached a basic specification, the Jetmaster installation guide and fascia brochure. The email from Melissa also stated:

I would recommend the upper fireplace being cladded right out to the edge of the Architrave to allow sufficient space for the Mantle either side of the Firebox whereas the Lower Fireplace I would recommend some wall space either side of the Sandstone due to the split face texture of the stone won’t allow a flush finish to the Architrave…

I’ve attached a basic specification but please confirm fire safety requirements with a qualified installer. Also attached are the jetmaster installation guide and fascia brochure.

190. [190]
     Mr Rainbow was taken to the specifications in the hearing,^[76] in particular to page 8 headed “Installation with full brick chimney” and to the requirement that the flue must be encased with brickwork and that a piece of 9mm fibre sheeting with a circular cut out to accommodate the flue be positioned on the chimney opening, one course of brickwork from the top of the chimney. Mr Rainbow was asked why he did not install 9mm thick fibre sheeting. Mr Rainbow said that the specification only applied to brick chimneys and that there was no specification of what to line a timber framed chimney with.^[77]
191. [191]
     Mr Pym also gave evidence at the hearing that they had contacted the manufacturer of the fireplace who had given them specifications as to how to build the frame. Mr Pym admitted to rebuilding the frame twice: once in accordance with how the manufacturer deemed necessary and then, after that, it was modified to suit exactly the way Michelle wanted it as far as stone and finishes to support the weight.^[78] Mr Pym said that the modifications made to suit Michelle’s requests was not a major job and that 80% of the $6, 500 originally claimed would easily have been attributable to modification work and 20% to aesthetics or how it was to be finished.
192. [192]
     I accept the submissions of the Owners that the fireplaces did need to be re-framed and that this was due to the lack of reasonable care by Mr Rainbow in ensuring he complied with the manufacturer’s specifications, in particular that there was sufficient distance away from the flue and Hebel.
193. [193]
     The issue arose as to whether the fireplaces needed to be re-built in any event, due to a late decision made by the Owners as to the finish of the fireplaces, in which case, it was submitted on behalf of Mr Rainbow, he should only be liable for the minimal cost of cutting away the section of timber that was too close to the flue. This was because Mr Rainbow would also, like Mr Pym, have been required to strengthen the fireplaces once the decision to clad in sandstone had been made, and would have been entitled to charge for that work.
194. [194]
     Dr Grogan gave evidence that she always intended to use sandstone. This is consistent with the email from Melissa above which was forwarded to Mr Rainbow on 16 January 2018. Further, an email from Dr Grogan to Mr Rainbow on 17 January 2018 stated:

Fireplaces- downstairs 1850, upstairs 1750. Downstairs the fireplace will be tiled in sandstone to ceiling cornice (drawings will be sent) Upstairs will be plaster board. Outside the fireplaces will be sandstone up to and including the chimney. I am ordering the fireboxes from jet master. Will talk again to them this week.^[79]

195. [195]
     However, Dr Grogan sent an email to Mr Rainbow on 14 March 2018 where she stated:

Splashbacks in kitchen to be same as bench.after today will tell u whether v the internal lower gd fireplace is in sandstone cladding. Outside the firplace (sic) is in sandstone or …stone cladding – awaiting price on latter for comparison.

196. [196]
     Mr Pym, the builder after Mr Rainbow, gave evidence that when they arrived there had not been a final decision as to the finish for the fireplaces and that they discussed this with Ed and Michelle regularly. The finish was important because, he said, “the weight per square metre of tiles or stone determined what structure was needed to be built behind the scenes to hold it”.^[80] Mr Pym said during the hearing:

Mr Pym: I’m not sure what Michelle had spoken to people previous to me, but we were looking at options when we got here. Was it going to be plastered? Was it going to be stone? Was it going to be tiled? Was it going to be painted? And there was no exact decision at that time.

…

We had a lot of discussions about fireplaces and finishes and what we would need to do to put stone up, and we just built it in a way that Michelle could put stone on there any time in the future.

Mr Amerena: You just mentioned you built it in a way that the Owners could put stone on in the future. Why did you do that?

Mr Pym: Because at that point, we were still discussing stone, tiles and there was a couple of different options. So if you build it and you sheet it, you build it and sheet it in a way that’ll handle the heaviest of all the options, which was stone, which is ultimately what went on there, so it was built correctly for the finish that was required.^[81]

197. [197]
     Mr Pym said that once it was decided that stone was going on there, then extra studs and timbers were put in the wall with FC sheeting to hold it in place.
198. [198]
     I accept that there was some uncertainty about whether the lower fireplace was to be clad in sandstone. However, Mr Rainbow was well aware that sandstone was, at least, one of Dr Grogan’s preferred options, if not her preference.
199. [199]
     It appears that Mr Rainbow was aware of the preference to use sandstone but was not aware of the weight of the sandstone when the framing was completed. Mr Rainbow said he found out about the weight of the tiles (60 kilograms per square metre) when the tiler came to talk about how it was going to be tiled.^[82] In Mr Rainbow’s words, “[t]hat changed everything”.
200. [200]
     In my view, if Mr Rainbow was not confident that Dr Grogan had settled on the sandstone then he should have confirmed this one way or the other before commencing the framing or, as was suggested by Mr Pym, “you build it and sheet it in a way that will handle the heaviest of all the options”.^[83]
201. [201]
     In my view, it was incumbent on Mr Rainbow, as the builder responsible for the installation of the fireplaces, to ascertain what tiles or cladding the Owners intended to use so that he could ensure that the framing he installed, including the Villaboard, was strong enough to support that material.
202. [202]
     In my view, the Owners are entitled to claim the cost of modifying the fireplace so that the framing was constructed in accordance with the specifications. I accept the evidence of Mr Pym that the modification could not be done by cutting out a piece of timber from the frame, without compromising its structural integrity.^[84]
203. [203]
     The claim is allowed in the revised amount of 80% of $6 500.
204. [204]
     Accordingly, I allow the claim in the amount of $5, 200.

13.  Workplace health and safety issues

205. [205]
     The Owners’ revised claim is for $9, 220.67 for works required to make the site safe again, including engineering reports, labour and carpentry and materials.
206. [206]
     On 2 April 2019 Ms Walker, an officer from Workplace Health and Safety, visited the site in response to a complaint from a neighbour that work was being done on site in an unsafe environment.
207. [207]
     On 3 April 2019 a Prohibition Notice^[85] was issued to Mr Pym pursuant to s 195 of the Work Health and Safety Act 2011 (Qld) in respect of the absence of fall protection on the interior stairs and the inadequacy of the pine timber guard rails on level one and level two.
208. [208]
     Mr Pym said in evidence that they were doing their dilapidation report when they were “kicked off” the site by an inspector from WH & S, because it was not safe for them to be there given the absence of floor protection on either the balconies or around the stairs.^[86]
209. [209]
     An email of 16 July 2019 from Mr Pym to the Owners sets out the circumstances surrounding the WH & S shut down. The email provided, relevantly, as follows:

On Thursday 4^th and Friday 5^th April the site was made safe however WH & S contacted us again and advised that all materials used during the “Make Safe” stage had to meet Engineering Requirements and as such and (sic) Engineer was required to inspect the site prior to us being cleared to return to work. The Engineer required additional works which were completed on Monday 8th and 9th April and we were given approval to continue work from Wednesday 10th April. (emphasis added)

210. [210]
     The email itemised the claimed costs “associated with delays and required works” as follows:

1. Garry Wills: $2, 691.00
2. Rod Pym: $1, 571.42
3. Labourer/carpenter: $2, 277.00
4. Engineers Report: $1, 581.25
5. General materials: $1, 100.00

Total: $9, 220.67

211. [211]
     No further information was provided as to the nature of the costs incurred. The total of the costs incurred by Mr Pym on behalf of the Owners ($9, 220.67), is claimed from Mr Rainbow.
212. [212]
     Mr Rainbow denied this claim on the basis that the WH & S issue happened in April 2019, 3 months after Mr Rainbow’s contract had been terminated by the Owners. At that time Mr Rainbow was not occupying the site and accordingly, Mr Rainbow submitted, not under any duty under the Work Health and Safety Act 2011. Mr Rainbow did not deny that he left the site in the condition in which it was when inspected by Ms Walker. Prior to termination, Mr Rainbow submitted that he and the Owners were under concurrent duties by reason of the Owners holding an Owner Builder Permit and that upon termination the Owners became solely responsible. Mr Rainbow said, in cross-examination, that he had installed the stairs in December 2018 but had not installed any guarding on the stairs.^[87]
213. [213]
     Dr Grogan held an Owner Builder Permit issued on 14 July 2015 which expired on 14 July 2021 for work performed at her home, the subject of these proceedings.
214. [214]
     Mr Pym had been occupying the site for a matter of days when the WH & S issues arose. Mr Pym said in the hearing that he had entered into an initial monthly contract with the respondents at that stage but had not reached the stage of a “completion contract or anything like that”.^[88]
215. [215]
     I am satisfied that, when Mr Rainbow left the site, in January 2019, the internal stairs, which traversed three storeys, did not have any handrails or balustrades and so constituted a fall hazard. In my view, leaving the site in this way was dangerous and could, potentially, have led to an accident. I accept Mr Rainbow’s evidence that Mr Turkovic had installed other safety barriers, for example, framing around the front decks but it appears, from the correspondence from WH & S, that this was not satisfactory.
216. [216]
     Mr Rainbow was in control of the site while he conducted his work. In my view, Mr Rainbow was under an implied contractual obligation to ensure that when performing his work the property complied with the WH & S requirements. I find that he breached that obligation. Had he performed the obligation, the site would have been in a compliant state when Mr Pym commenced his work. Instead, the site had to be put into a state compliant with WH & S requirements. That came at a cost of $9, 220.67 to the Owners and they have therefore suffered damages in that sum by reason of the breach.
217. [217]
     That Dr Grogan held an Owner Builder Permit which may, or may not, have subjected her to a statutory obligation to remedy the unsafe state of the site is not to the point. There was, in my view, a contractual obligation on Mr Rainbow, who had control of the site while he was there, to make it compliant.
218. [218]
     In these circumstances, I consider that, Mr Rainbow is responsible for the costs incurred in making the site safe and WH & S compliant.
219. [219]
     Accordingly, I allow this claim for $9, 220.67.

(b) Restitutionary claim by the Owners

220. [220]
     The Owners made the following claim in restitution for recovery of money paid under mistake of fact, in this case money paid for work charged for and paid to Mr Rainbow but not actually undertaken. The Owners relied on Australia and New Zealand Banking Group Ltd v Westpac Banking Corporation^[89] where the High Court held:

In other words, receipt of a payment which has been made under a fundamental mistake is one of the categories of case in which the facts give rise to a prima facie obligation to make restitution, in the sense of compensation for the benefit of unjust enrichment, to the person who has sustained the countervailing detriment (cf. Pavey & Matthews Pty. Ltd. v. Paul [1987] HCA 5; (1987) 162 CLR 221, at pp 227, 254-257, 267).^[90]

221. [221]
     The Owners submitted that carelessness on behalf of the payer is not a bar to the payer’s subsequent recovery in restitution, if the mistake of fact is actually held by the payer.^[91]
222. [222]
     A plaintiff bears the burden of establishing on the balance of probabilities that a causative mistake has been made, in other words, that the mistake caused the payment. The relevant category of mistake is that moneys were paid by the payer in the mistaken belief that he or she was under a legal obligation to pay the moneys or that the payee was legally entitled to payment of the moneys. Such a mistake would be causative of the payment.^[92] Here the mistake is submitted by the Owners to be: if the Owners had known that some of the respective works or services charged by the builder had not actually been done, or were not actually a liability of the Owners, they would have never paid the invoice provided (or rather that part of the invoice relating to the services not undertaken).^[93]
223. [223]
     It is possible to displace a prima facie obligation to make restitution. In David Securities Pty Ltd v Commonwealth Bank of Australia^[94] the High Court held:

The fact that the payment has been caused by a mistake is sufficient to give rise to a prima facie obligation on the part of the respondent to make restitution. Before that prima facie liability is displaced, the respondent must point to circumstances which the law recognizes would make an order for restitution unjust ((79) Westpac Banking Corporation (1988) 164 CLR, at p 673). There can be no restitution in such circumstances because the law will not provide for recovery except when the enrichment is unjust. It follows that the recipient of a payment, which is sought to be recovered on the ground of unjust enrichment, is entitled to raise by way of answer any matter or circumstance which shows that his or her receipt (or retention) of the payment is not unjust.^[95]

224. [224]
     The claims in restitution^[96] are as follows:

     1. (i)
        Invoice 303 for $7, 544.57;
     2. (ii)
        Invoice 308B for $113.85;
     3. (iii)
        Invoice 311 for $227.70;
     4. (iv)
        Invoice 320 for $311.64;
     5. (v)
        Invoice 311 (re Mal Gardner invoice) for $695;
     6. (vi)
        Invoice 319 for $9, 108.

1. (i)
   Invoice 303

225. [225]
     The Owners claim they were wrongly charged for the following items in invoice 303:

     1. (a)
        QBCC Insurance - $2, 592.90 (though revised up to $6, 160 after the agreed Table was filed)
     2. (b)
        QLeave Levy, Public Liability Insurance and Construction Works’ Insurance - $3, 864.80
     3. (c)
        Temporary Electrical Site Pole - $426.87
     4. (d)
        Cleaning fee on completion - $660.
226. [226]
     Invoice 303 was issued on 16 July 2018 and attached a cost of preliminary items by way of a list. The list stated at the bottom:

These preliminaries do not form part of the contracted works but are payable by the customer at the start of work. There is no builders margin on these items.

1. (a)
   QBCC Insurance

227. [227]
     On 19 November 2018 the QBCC wrote to Michelle Grogan attaching her Notice of Cover under the Queensland Home Warranty Scheme. The Notice stated that cover commenced on 15 July 2018 for the insurable value of $307, 358.00 and that the premium paid was $ 3 567.10. The Owners originally claimed an amount of $2, 592.90 representing the amount they were overcharged by Mr Rainbow. In their closing submissions, the Owners claim they were overcharged the entire amount of $6, 160 on the basis the insurance ‘was never able to be claimed’. They say that the builder paid $3, 567.10 to the QBCC and, that under s 68A of the QBCC Act, the builder is required to pay the premium on behalf of the Owners. They say it follows that it is his responsibility to recover the sum from the QBCC and to pay it back to the Owners. The Owners say that the builder’s failure to take any steps to implement QBCC insurance is a failing only of his, that no signed contract existed in breach of the QBCC’s consumer protections which meant any insurance for the Owners was invalid. They argue that the builder has been unjustly enriched by payment of this amount because consideration has failed, in that no insurance was ever available where no signed contract existed. They say that the onus lies on the builder to demonstrate why an order for restitution would be unjust and he has not demonstrated this. They say he should refund the entire amount and then seek reimbursement from the QBCC of the part payment made by way of premium by him.
228. [228]
     Mr Rainbow admits that he was not entitled to payment in respect of QBCC Home Warranty Insurance because the Owners, being owner/builders were not entitled to that insurance. Mr Rainbow says that the QBCC will be refunding a proportion of the monies paid by the Owners directly to them. Mr Rainbow agrees he owes them the remainder, namely $2, 592.90.
229. [229]
     At the time the premium was paid by the Owners to Mr Rainbow, the premium was to cover the estimated cost of the works once completed. At that stage Mr Rainbow was still expecting to receive back a signed contract from the Owners. Mr Rainbow gave evidence, which I accept, that he was advised by the QBCC when he explained his predicament, to pay only the portion of the Home Warranty Insurance premium that related to the actual cost of the works performed by him at that date.
230. [230]
     In my view, Mr Rainbow must refund the entire amount he charged the Owners for QBCC insurance, namely, $6, 160, which was insurance he could not obtain.

(b)  QLeave Levy, Public Liability Insurance and Construction Works’ Insurance

231. [231]
     The Owners submit that the QLeave Levy, public liability insurance and construction works insurance are not supported by documentation, not discussed in the draft contract proposals and are the statutory responsibility of the contractor, not the owner. They say they are not recoverable pursuant to a quantum meruit claim because they cannot be said to be a “reasonable sum” for services but rather the cost of the builder doing business generally. They say there is no evidence that part or all of these costs relate specifically to the work done at the Owners’ premises. They say they only paid under the mistake they were liable under a contract which in hindsight is not effective because it was not signed.^[97] These amounts they say represent an over charging of $3, 854.80.
232. [232]
     Mr Rainbow claims that QLeave, Public Liability Insurance and Construction Works insurance are all costs incurred by him which he can claim from the Owners. Mr Rainbow refers to clause 29.3(d), (g), (i), (q), (x) and (y) of the Cost Plus Contract which he says provides that all outgoings in relation to the works are to be paid as part of that contract and at all times, before and during the works. Mr Rainbow says that the Owners were made aware of these costs and of their responsibility to pay for them. He says that the expenses were paid at the start of the works and so the Owners cannot request a refund of moneys paid as part of the works.
233. [233]
     By s 66 of the Building and Construction Industry (Portable Long Service Leave) Act 1991 (Qld), the following levies are imposed on building and construction work:

     1. (a)
        Building and construction industry training levy;
     2. (b)
        Long service levy; and
     3. (c)
        Work health and safety levy.
234. [234]
     Section s 74(e) of that Act provides that, apart from exceptions that do not apply here, the levies for building and construction work must be paid ‘by the person for whom the work is to be done’. This could be either the Owners, for whom the work was ultimately done, or the builder, who is engaging sub-contractors for whose benefit the fee is paid.
235. [235]
     The issue of whether the homeowner was liable to reimburse QLeave payments arose in Sun Building Services Pty Ltd v Minh^[98] where Member Deane observed:

[99] The levy is payable ‘by the person for whom the work is to be done’. Sun Building Services contend that this is Mr Tran and Mrs Pham. Mr Tran and Mrs Pham contend that this is the builder, who is engaging subcontractors for whose benefit the fee is paid. There is little guidance from the legislation or case law.

[100] In my experience, contracts usually make it clear that the builder pays the fee and it forms part of the contract price.

[101] If the legislation imposes the liability on the Owners then the relevant authorities would have the right to pursue the Owners if it was unpaid. It has been paid. The authorities’ right is not an issue and resolving that question does not, in my view of itself, entitle Sun Building Services to claim reimbursement.

[102] Sun Building Services took it upon itself to pay the fees without informing Mr Tran and Mrs Pham that the amount was not part of the contract price, was payable by them and seeking their agreement that if it was paid by Sun Building Services they would reimburse it.

[103] It is clear there was no collateral contract because Sun Building Services did not raise this matter with the Owners until after the amounts had been paid. As stated earlier the contract did not contemplate which party was to pay this fee. Sun Building Services is effectively claiming a variation to the contract, which was not reduced to writing before the work was undertaken.

[104] Given the direct costs incurred and Sun Building Services financial position not receiving any amount for this item would likely cause hardship.

[105] However, I am not satisfied that it would cause unreasonable hardship because I am not satisfied that the nature and extent of the hardship is unreasonable in the circumstances in which it occurs. Factors relevant to such a finding are that there is no evidence before me:

(a)that Sun Building Services could not have reasonably foreseen that such a levy was required to be paid in respect of the work to be undertaken by it and discussed it with the Owners prior to entering into the contract;

(b) if the amount was not included in the contract price, as to why Sun Building Services did not discuss with the Owners that the levy was required to be paid before paying the first amount in July 2012;

(c) if the amount was not included in the contract price, as to why Sun Building Services did not seek reimbursement when the first amount was paid in July 2012;

(d) if the amount was not included in the contract price, as to why Sun Building Services did not discuss with the Owners that the levy was required to be paid before paying the second amount in April 2013.

[106] I accept that if the legislation imposes the liability on the Owners then that is a factor, which would weigh in favour of a finding that it would not be unfair to the Owners to require them to pay an amount for this item. In view of my finding in respect of the first limb of the test it is not necessary to make a finding on the second limb.

236. [236]
     The Owners submitted in relation to Minh that Member Deane was critical of the builder in not agreeing with the Owners in advance as to who would bear the cost of the QLeave levy and found in that case that the builder was liable. The Owners submitted that they were under no contractual obligation to repay the builder (as no enforceable contract existed) and where the levy is normally payable by the builder unless the contract says otherwise, there is no basis for the sum to be passed on to the Owners.
237. [237]
     In this case, although the cost-plus contract was not signed, the parties proceeded on that basis. By that contract, outgoings are payable by the Owners. Moreover, in my view, the Owners were the persons for whom the work was done within the meaning of s 74(e) of the BCI(PLSL) Act and, accordingly, were responsible for paying the levy. In any event, the Owners presumably agreed to pay the levy when they paid Invoice 303 which provided that $2, 717 was payable for the QLeave levy. I find that Mr Rainbow was entitled to reimbursement from the Owners in respect of the levies paid by him in relation to the relevant building works.
238. [238]
     Similarly, I find that the insurance premiums paid by Mr Rainbow in respect of the works are necessary business expenses incurred by him, directly relevant to undertaking the works. Those costs are, in my view, also entitled to be claimed by Mr Rainbow from the Owners.
239. [239]
     Accordingly, the restitutionary claim for $3, 854.80 is refused.

(c)  Electrical pole

240. [240]
     The Owners allege that $426.87 was not payable as this was a charge for the pole until 23 July 2018 but that the electricity was not actually connected until 13 August 2018 due to delay in the submission of paperwork by Bill Roach, Mr Rainbow’s electrician. It appears that a connection offer was sent from Energex to Bill Roach on 27 April 2018 which was not accepted. A new application was then made and ultimately accepted by Mr Roach. The Owners say that the fault for the delay in the connection of permanent electricity lies with Mr Rainbow’s electrician and that, in these circumstances, the amount of $426.87 is not due and payable.
241. [241]
     They say they paid under a mistake that the electricity connection to the house had been promptly and properly attended to by the builder’s electrician. They say Bill Roach conceded that he made a mistake which led to the electrical pole being required to be on the site longer than should have been necessary.^[99]
242. [242]
     Mr Rainbow claims that the rental of the temporary electrical pole and its removal were all costs incurred by him and for which he was entitled to claim. He said he only charged for the period the temporary electrical pole was reasonably required and that he had not charged the additional rental due to the delays resulting from the resubmission of the connection application. He said he began works onsite on or around 2 July 2018 and that the cost of the temporary pole hire was paid by himself up until 8 August 2018 at a cost of $693.69. He said he invoiced the Owners $426.87 and did not invoice them the remainder in recognition of the delay caused by his sub-contractor.
243. [243]
     The amount of $426.87 for ‘Temporary electrical site pole’ is listed under the heading ‘Preliminaries’ which was forwarded to the Owners as an attachment to a quotation dated 30 June 2018. In a later version of the Preliminaries it is listed as a charge for the site pole to 23 July 2018. It appears from a later invoice dated 15 September 2018 that the Owners were charged an additional $246.36 for temporary power pole hire and removal.
244. [244]
     It is unclear from the evidence how long the Owners could reasonably have been expected to require a temporary power pole, how much they paid by way of hire costs in total for the power pole and how much they should reasonably have paid taking into account the delay caused by Mr Roach.
245. [245]
     While Mr Rainbow commenced work on 2 July 2018 the electricity was not connected to site until 13 August 2018. The electrician admitted that the delay in connection was due to error on his part in submitting the necessary paperwork. In the circumstances it is unclear on the evidence how much extra, if any, the Owners paid by way of hire for the temporary power pole. Mr Rainbow says that he took the delay into account in charging a reduced amount for the hire. There was no evidence however, of the charges paid by him for hire of the power pole.
246. [246]
     The evidence regarding this item is deficient on both sides. As the Owners bear the onus of proof, I do not allow this claim.

(d)  Cleaning fee 

247. [247]
     The Owners say they were charged a ‘cleaning fee’ of $660 and refer to Invoice 303 and to the Affidavit of Blair Rainbow at [20] which they say refers to the invoice.
248. [248]
     The invoice referred to in [20] of that affidavit is attached as exhibit BR18. In fact the list of preliminaries to which invoice 303 referred (which totalled $4, 250.37) did not refer to a cleaning fee of $660. The list of preliminaries attached to the invoice included an amount for:

Site Clean and pump of basement: $765 (incl GST)

249. [249]
     However, the list of preliminaries (undated) attached by the respondents to a covering letter titled “Provision of documents constituting the contract” included a quotation (no 1211 dated 30 June 2018) together with a list of preliminaries which included both the $765 for site clean and a separate item for “Builders house clean on completion for $660”. 
250. [250]
     The basement had flooding/water ingress issues at the commencement of the works which could explain the charge for $765. That item could have been a clean and pump that occurred at the start of the works rather on completion. The Owners, however, referred to Mr Rainbow’s closing submissions where he admitted he was not entitled to payment of $660 in respect of the cleaning fee on completion because he did not get to complete the works due to the conduct of the respondents in terminating the contract prior to completion.
251. [251]
     Although Mr Rainbow rightly conceded that he was not entitled to charge a cleaning fee on completion,^[100] the actual invoice relied upon (invoice 303) excluded the $660 sum and only charged the $765 fee, which was not for work to be performed on completion.^[101] I am, therefore, not satisfied on the evidence before me, that the Owners paid the $660 as a preliminary cost.
252. [252]
     Accordingly, I do not allow this claim.

2. (ii)
   Invoice 308B

253. [253]
     The Owners claim that the electrician has charged them twice for submitting forms to Energex regarding the connection of electricity to the property.
254. [254]
     Mr Rainbow submitted that to the extent that such costs were incurred as a consequence of any error or omission on the part of Mr Rainbow’s subcontractor, that he was not entitled to claim payment of those costs but that otherwise the sum claimed was due from the Owners to him.
255. [255]
     Further, Mr Rainbow, in his closing submissions ‘admitted that the amount of $113.85 is to be credited to the respondents’ account.^[102]
256. [256]
     Accordingly, I allow the sum of $113.85.

3. (iii)
   Invoice 311

257. [257]
     The Owners claim that the electrician again double charged them for submitting forms to Energex, this time in the amount of $227.70.
258. [258]
     Mr Rainbow repeated his submissions in respect of invoice 308B.
259. [259]
     An email from Bill Roach to Michelle Grogan on 12 September 2018 sets out the labour charges across 3 separate invoices by him to Mr Rainbow in respect of time he spent submitting and re-submitting forms to Energex.
260. [260]
     Mr Rainbow in his closing submissions also admitted that the sum of $227.70 was to be credited to the respondents’ account.
261. [261]
     Accordingly, I allow the sum of $227.70.

4. (iv)
   Invoice 320

262. [262]
     The Owners claim the electrician’s charges for the hire of the temporary electrical site pole for $311.64 was unwarranted.
263. [263]
     Mr Rainbow submits that the rental of the temporary electrical site pole and its removal were all costs incurred by him and he is entitled to claim payment of those costs from the respondents. He says that in invoice 320 he has not sought to claim any costs incurred as a consequence of any error or omission on the part of the subcontractor.
264. [264]
     I accept the evidence of Mr Rainbow that the charges were legitimately incurred and not a consequence of any delay or error by the electrician. I find there is no basis for the claimed deduction sought in respect of this invoice.
265. [265]
     Accordingly, I do not allow this claim.

5. (v)
   Invoice 311 (Invoice Mal Gardner)

266. [266]
     The Owners claim that they paid Mr Rainbow $695 for carpentry works which he did not complete. They rely on an invoice from Mal Gardner dated 1 February 2019 for that amount. The invoice stated it was for the following work:

Supply materials and build enclosure for spa bath

Fit deadlock

Materials and labour: $695

267. [267]
     The Owners submitted that the amount of $695 related to the portion of carpentry works that Mr Rainbow was paid for but did not complete, namely the ensuite and spa bath framework and installing the front door handle/lock. They said that Mr Rainbow charged an invoice to complete final framing in invoice 311 where he charged for “final framing of all walls and ceilings”. They say the framing for the bath sat adjacent to the wall and should have been completed in those charged for works. Consequently, that they had been forced to engage a carpenter to undertake those works and so, by mistake, had overpaid Mr Rainbow for works which were not completed in the amount of (approximately) $695.
268. [268]
     Mr Rainbow denied this and claimed that he only charged for works completed on site and for which he was entitled to be paid. Mr Rainbow submitted that the works carried out by Mal Gardner were those associated with the framing of the bath/spa. Mr Rainbow said that as the bath had not been provided by the Owners he did not carry out those works and had not sought payment in relation thereto.
269. [269]
     Mr Rainbow said that the works were not done because the bath needed to be onsite at the time of framing to ensure correct installation and that the bath had not been supplied by the time the contract was terminated. Further, that the installation of the front door lock and handle was never part of the scope of works and that he had not charged for it.
270. [270]
     It is apparent from the scope of works - carpentry quote dated 15 September 2018 that the work associated with the framing of the spa bath was quoted as a separate item. The quote provided:

Frame and line spa bath in ensuite - $260.

271. [271]
     I also accept Mr Rainbow’s evidence that installation of the front door handle and lock was not included in the scope of works.
272. [272]
     I do not consider that a reference in invoice 311 to “framing of all walls and ceilings” includes the framing for the spa bath, notwithstanding it may have sat adjacent to the wall.
273. [273]
     I accept the evidence of Mr Rainbow that he has not charged for either item. The Owners have not satisfied me otherwise.
274. [274]
     Accordingly, this claim is refused.

6. (vi)
   Invoice 319

275. [275]
     The Owners claim they were overcharged the sum of $9, 108 for external cladding not undertaken. The sum comprised: the amount charged for external cladding not undertaken ($7, 200), a 15% margin ($1, 080), plus GST ($828).
276. [276]
     Mr Rainbow denied this claim. He submitted that invoice 319 charged $7, 200 for lining exterior ceilings and that, as stated on the face of invoice 319, $2, 480 was omitted from the invoice on account of cladding works that were not completed. Mr Rainbow clarified in the hearing that by “cladding” in that context he meant the exterior chamfer boards on the walls.
277. [277]
     I understand from invoice 319 that the quoted amount for this stage of the works included an amount for cladding but that, because the cladding had not been done, an amount of $2, 480 was omitted from the invoice. Dr Grogan said that Mr Rainbow had not done any cladding but that $2, 480 for “finishing the cladding” suggested that they were charged for some cladding which Mr Rainbow did not do.
278. [278]
     I accept that the invoice is unclear.
279. [279]
     Mr Rainbow maintained that $7, 200 was only for lining the exterior ceilings while the Owners argued the amount was for that work plus some cladding which was not done.
280. [280]
     Dr Grogan pointed to the $11, 000 ultimately charged for finishing the cladding, presumably from which it could be inferred that the $7, 200 must have included an amount for cladding work because $2 480 to complete it from scratch was unrealistic.
281. [281]
     However, the $11, 000 charged by Mr Pym was also for new cladding work associated with installation of the concrete paths which involved removing the bottom two layers of cladding and their re-installation. This was not work within the scope of the cladding work to be undertaken by Mr Rainbow at the time he sent his invoice. Mr Pym was asked in the hearing how much of the $11, 250 he charged for cladding was for new cladding and how much was for rectification of existing cladding.^[103] Mr Pym said it was approximately a fifty-fifty split, $5, 500 each way.^[104]
282. [282]
     It follows, in my view, given the acknowledgment by Mr Pym, that it is possible that the amount of $2 480 deducted from Mr Rainbow’s invoice was for finishing the cladding given Mr Pym charged approximately $5, 500 for that work, and that the remainder of the invoice was for lining the external ceilings.
283. [283]
     The Owners claim in the alternative that the sum was paid in the mistaken belief that the work on the exterior ceiling had been substantially completed, when it had not.
284. [284]
     I am not satisfied that this amount was charged by Mr Rainbow for work that was not completed by him. Accordingly, this claim is refused.

Conclusion

285. [285]
     The builder is entitled to $65, 019.11 by way of quantum meruit for the reasonable value of the work completed by him but not paid for.
286. [286]
     The Owners are entitled to the following amounts by way of damages for rectification of defective work:

287. [287]
     I have allowed the restitution claim in the amount of $6, 501.55.
288. [288]
     The Owners are entitled to a total of $36, 847.82 by way of counter-claim.
289. [289]
     Accordingly, the amount owing to Mr Rainbow is $65, 019.11 less $36, 847.82, a total of: $28, 171.29. Mr Rainbow has said he makes no claim as to costs, excluding the filing fee. Considering the Owners had legitimate claims regarding defective work and the invoicing was less than satisfactory, I will not allow this claim.
290. [290]
     The Owners have claimed costs, subject to the decision, pursuant to s 77(3)(h) of the QBCC Act. Given both parties have been successful to some extent, my preliminary view is that there should be no order as to costs. If the parties wish to be heard on costs, they should file submissions in accordance with the directions made. Otherwise, I will order that there be no order as to costs.