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Henley Properties (Qld) Pty Ltd v Salam QCAT 273
QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL
Henley Properties (Qld) Pty Ltd v Salam  QCAT 273
Henley Properties (Qld) Pty Ltd
MUHAMMAD SALAM and SEOWMEE SALAM
8 July 2022
On the papers
PRACTICE AND PROCEDURE – Application for leave to make an application under s. 84 Domestic Building and Contracts Act 2000 following an appeal, failure to do so after closing case due to the neglect of the party or its legal advisors – Principle of finality – Exercise of discretion in interests of justice
Domestic Building and Contracts Act 2000 (Qld)
Autodesk v Dyason [No2] (1993) 176 CLR 300
Burns v Joseph  Qd R 130
CC Containers Pty Ltd v Lee [No 5]  VSC 619
Di Stasio Pty Ltd v R & K Services  VSCA 340
Smith v NSW Bar Association (1992) 176 CLR 256
Tate v McLeod (1969) Qd R 217
This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld)
REASONS FOR DECISION
- I have been asked to consider whether Henley Properties (Qld) Pty Ltd (‘the builder’) should be granted leave to make a claim pursuant to s. 84 of the Domestic Building Contracts Act 2000 (DBCA).
- This matter has a long history. The Application for domestic building dispute was heard by the Tribunal on 20 and 21 March 2014. A decision was delivered on 3 September 2014. Both parties were successful. Muhammad Salam and Seowmee Salam (‘the homeowners’), appealed the decision whereby the builder succeeded in recovering the cost of variations. They were successful in setting aside that part of the decision which amounted to $17,779.53 after setting off their successful claim for defective work.
- The Appeal Tribunal ordered, inter alia, that the matters be remitted to the Tribunal for determination according to law.
- Following the appeal, the builder filed an Application for Miscellaneous Matters (“the Application”) seeking orders in respect of the reconsideration. In addition to the relief sought in the original proceedings, it seeks alternative relief as follows:
… pursuant to section 84 (2)(b) and section 84 (6)(a) of the Act, the applicant applies for the Tribunal's approval to recover the amount of $21,417.00 for variation work being the increase in the contract price stated in the appropriate variation documents.
- I was asked to determine whether the builder can seek such relief and rely on fresh evidence or whether the learned member who heard the matter should determine the matter on the evidence already before him.
- On 21 October 2021 I determined that it could and made the following directions:
- (a)The (the builder) file in the Tribunal its statements of evidence addressing:
- The reasons for its delay in making its claim under s. 84 of the Domestic Building and Contracts Act 2000 (Qld).
- All necessary requirements for a claim as outlined in s. 84 of the DBCA including the costs of carrying out the variation and any reasonable profit.
- (b)The homeowners file their statements of evidence in response.
- I now consider whether leave should be granted.
- The builder’s General Manager, Alex Raleigh has filed a detailed statement of evidence dated 13 December 2021. The homeowners have not filed any material.
- Obviously, the omissions by the builder are technical but the purpose of the provisions were inserted for the protection of consumers. However, the legislature provided an alternative basis for the builder to recover the cost of variations in certain circumstances.
- The builder is described by Mr Raleigh as a volume builder. At the time it was building 500 – 650 homes a year. It did not build bespoke homes. It had a number of house designs and façades which an owner could select from. There was a base price for each design and façade. There were a number of variations or additions which a customer could request at an additional cost.
- The builder had its head office in Victoria. Its internal processes, in place at the time, required any variations to be recorded in a document which were then forwarded to the owner for signature. The builder followed the Victorian legislation which he states required the owner’s signature but did not require the builder’s signature. The Victorian legislation did not require the owners to initial the timing of payments.
- Mr Raleigh states that he was not aware of any earlier instances where he was made aware that the process the company was following did not comply with the Queensland legislation.
- In Smith v NSW Bar Association the majority of the High Court said:
It is again necessary to distinguish between the considerations which may bear on a decision to re-open and the processes involved in reconsideration once a case has been re-opened. If an application is made to re-open on the basis that new or additional evidence is available, it will be relevant, at that stage, to inquire why the evidence was not called at the hearing. If there was a deliberate decision not to call it, ordinarily that will tell decisively against the application. But assuming that that hurdle is passed, different considerations may apply depending on whether the case is simply one in which the hearing is complete, or one in which reasons for judgment have been delivered. It is difficult to see why, in the former situation, the primary consideration should not be that of embarrassment or prejudice to the other side. In the latter situation the appeal rules relating to fresh evidence may provide a useful guide as to the manner in which the discretion to re-open should be exercised. But those considerations bearing on re-opening are not decisive of the question whether, a matter having been reopened by reason of error, further evidence can be called.
Not every case involving error will invite further evidence: it will depend entirely on the issue that is opened up. If the issue is one that invites further evidence, then, prima facie and subject to the ordinary rules of evidence, that evidence should be allowed. We say prima facie because there may be situations in which the particular evidence involved would cause embarrassment or prejudice such that, in the circumstances, it would be unfair to allow it.
- In the instant case it is not so much a case of fresh evidence but an explanation why an alternative claim to recover the cost of variations was not raised at the hearing before the close of the builder’s case.
- In Burns v Joseph counsel for the defence, during his address, raised a new defence not previously pleaded. The trial judge, on his own motion, recalled the plaintiff to rebut the defence. The Court of Appeal approved that course of action.
- It is not doubted that the Tribunal has a discretion in determining whether the builder may bring the alternative claim for the cost of the variations. However, it must be satisfied that there is an explanation as to why the alternative claim was not pleaded and was raised after the close of evidence.
- The builder’s explanation is that the company did not have an in-house lawyer. The lawyers the company engaged for the hearing did not at any stage advise him prior to the hearing that an application pursuant to s. 84 of the DBCA was required. Those lawyers are no longer engaged by the builder.
- Inadvertence by counsel can be the basis for reopening the evidence.
- The case of Di Stasio Pty Ltd v R & K Services is instructive. The case has many issues in common with the issues in this matter. The builder in that case was required to serve on the owner a tax invoice equal in value to the certificate issued by the architect. In a claim in excess of $100,000, the difference between the certificate and the invoice was $882.57. Nevertheless, the trial judge regarded the difference while small as material. It could have been remedied had the builder issued a tax invoice equal in value to the certificate at any time prior to the end of the trial. There was no further tax invoice, no application to amend and no application to reopen the evidence. Consequently, the builder failed to recover the progress payment.
- Subsequently, a month later, the application to reopen was made. The trial judge referred to the statement of principles by Ferguson J in CC Containers Pty Ltd v Lee [No 5] which were:
… there are four recognised classes of case in which a court may grant leave to reopen as follows:
(a) where fresh evidence, unavailable or not reasonably discoverable before, becomes known and available;
(b) where there has been inadvertent error;
(c) where there has been a mistaken apprehension of the facts; and
d) where there has been a mistaken apprehension of the law.
These classes are not closed and the overriding principle is that leave to reopen will be granted if, taken as a whole, the justice of the case favours such a course.
- The basis of the reopening in that case was the mistaken apprehension of the law by the builder’s solicitor who appeared as counsel at the hearing.
- The trial judge eventually allowed the progress payment. The owner appealed.
- Tate JA (with whom McLeish JA and Niall JA agreed) referred to the decision of Autodesk v Dyason [No2]where Mason CJ acknowledged that the exceptional step of reopening a case after judgment has been delivered may occur when the court has proceeded on a misapprehension as to the facts or the law that is not attributable to the neglect or default of the party seeking to reopen:
These examples indicate that the public interest in the finality of litigation will not preclude the exceptional step of reviewing or rehearing an issue when a court has good reason to consider that, in its earlier judgment, it has proceeded on a misapprehension as to the facts or the law. … However, it must be emphasized that the jurisdiction is not to be exercised for the purpose of re-agitating arguments already considered by the Court; nor is it to be exercised simply because the party seeking a rehearing has failed to present the argument in all its aspects or as well as it might have been put. What must emerge, in order to enliven the exercise of the jurisdiction, is that the Court has apparently proceeded according to some misapprehension of the facts or the relevant law and that this misapprehension cannot be attributed solely to the neglect or default of the party seeking the rehearing. The purpose of the jurisdiction is not to provide a backdoor method by which unsuccessful litigants can seek to reargue their cases.
(emphasis is mine)
- The Court of Appeal allowed the reopening, but it did so on the basis that it considered that the solicitor’s failure was inadvertence rather than neglect. Tate JA said:
In the circumstances, I consider that it was open to the judge to characterise these failures as ‘inadvertence’ rather than ‘neglect’ because they were premised upon a lack of understanding or a misapprehension; it was not a matter of the solicitor failing to act diligently to complete steps he knew he ought to take.
- It is true that the owners in the instant case have had a windfall. They have received the benefit of the work the subject of the variations free of the obligation to pay for the work. The only prejudice they face is a prolongation of proceedings and the inconvenience, if the builder is successful, of having to pay for the work they have received the benefit of.
- In Tate v McLeod Lucas J observed:
It is not the law that where a plaintiff shows only that a delay has been caused by the inadvertence of his solicitor, he has necessarily failed to show good cause for being given leave to proceed. But in this case, in which, as I say, the late defendant's executors will be substantially prejudiced if the action proceeds, I think it is better to leave the plaintiff to pursue any remedy which he may be able to enforce against his former solicitor. It seems to me that it would be an unwarranted indulgence in the circumstances of this case to allow the action to proceed.
- In the exercise of my discretion, I refuse leave to bring the application. I do so for the following reasons:
- (a)The failure to bring the s. 84 application was not due to inadvertence but would appear to arise from neglect of the builder or his solicitor.
- (b)There should be finality to the litigation. This matter has been in the Tribunal since 2013.
- Such an application should have been readily apparent to any lawyer practising in this jurisdiction, if, in fact, that failure was due to those advising the builder. If there has been such neglect then the builder will have a remedy against its lawyers.
- I refuse leave and dismiss the application
- Published Case Name:
Henley Properties (Qld) Pty Ltd v Salam
- Shortened Case Name:
Henley Properties (Qld) Pty Ltd v Salam
 QCAT 273
08 Jul 2022