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Unreported Judgment

Natter Pty Ltd t/as Stroud Homes Gold Coast v Queensland Building and Construction Commission[2023] QCAT 208Senior Member Traves
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Natter Pty Ltd t/as Stroud Homes Gold Coast v Queensland Building and Construction Commission[2023] QCAT 208

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:	Natter Pty Ltd t/as Stroud Homes Gold Coast v Queensland Building and Construction Commission & ors [2023] QCAT 208
PARTIES:	natter pty ltd t/as stroud homes gold coast (applicant) v queensland building and construction commission (First respondent) gerard benedet (Second respondent) talena benedet (Third respondent) giuseppe esposito atf antaxs tiling & waterproof solutions (Fourth respondent) roya tiling pty ltd (Fifth respondent)
APPLICATION NO/S:	GAR278-22
MATTER TYPE:	General administrative review matters
DELIVERED ON:	16 June 2023
HEARING DATE:	16 June 2023
HEARD AT:	Brisbane
DECISION OF:	Senior Member Traves
ORDERS:	Gerard Benedet, Talena Benedet, Giuseppe Esposito ATF Antaxs Tiling & Waterproof Solutions and Roya Tiling Pty Ltd are joined to the proceedings under s 42 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld). The matter is listed for a compulsory conference on a date and time to be advised.
CATCHWORDS:	PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – JOINDER OF CAUSES OF ACTION AND OF PARTIES – PARTIES – where review of decision to issue a direction to rectify – where application to review named several respondents – where parties to review jurisdiction set out in s 40 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) – whether homeowners and/or subcontractors should be removed – whether homeowners and/or subcontractors should be joined to the proceeding under s 42 Queensland Building and Construction Commission Act 1991 (Qld), s 72, s 72A Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 40, s 42 Donovan Hill Pty Ltd v McNab Constructions Australia Pty Ltd [2015] QCA 114
APPEARANCES & REPRESENTATION:	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

[1]
On 15 June 2020 Natter Pty Ltd and Gerard Benedet and Talena Benedet (the homeowners) entered into a contract for the construction of a single-storey house at their property in Kingsholme.
[2]
The homeowners lodged a complaint, listing 31 items, in respect of the building work.
[3]
On 7 June 2022 the Queensland Building and Construction Commission issued a direction to rectify against Natter Pty Ltd in respect of 26 of the 31 complaint items.
[4]
On 6 July 2022 Natter Pty Ltd applied to the Tribunal for review of the decision of the Queensland Building and Construction Commission to issue a direction to rectify to Natter Pty Ltd. The application listed as “respondents”: the Commission; Gerard Benedet; Talena Benedet; Giuseppe Esposito ATF Antaxs Tiling & Waterproof Solutions and Roya Tiling Pty Ltd.
[5]
It appears that most, if not all, of the items the subject of the direction to rectify relate to tiling work. Natter Pty Ltd accepts it was the principal contractor and that it engaged Antaxs Tiling & Waterproofing Solutions by way of subcontract to complete tiling works at the property. Natter subsequently engaged Roya Tiling Pty Ltd by way of subcontract to rectify defects that had been identified in the tiling work on handover. Natter Pty Ltd state in the application to review that Roya Tiling performed the rectification works defectively. The application also refers to a settlement deed entered into between Natter Pty Ltd and the homeowners under which the homeowners allegedly agreed not to require Natter Pty Ltd to rectify certain defects.
[6]
The applicant contends that the decision to issue the direction to rectify was wrong or not properly made because the Commission did not take into account all relevant circumstances including the subcontracts between Natter Pty Ltd and each of Antaxs Tiling and Roya Tiling Pty Ltd and the terms of the Settlement Deed.
[7]
On 28 July 2022 the Tribunal issued directions naming all the parties listed as respondents in the application to review.
[8]
Directions were subsequently issued by the Tribunal directing Natter Pty Ltd to file submissions addressing why Gerard and Talena Benedet (the homeowners), Giuseppe Esposito ATF Antaxs Tiling & Waterproof Solutions and Roya Tiling Pty Ltd should not be removed as respondents and for the respondents to file any submissions in response. The applicant and each of the respondents, bar the fourth respondent, filed submissions. The submissions addressed who the correct parties to the review proceeding were and whether the homeowners and subcontractors should be removed as parties.

Statutory framework: parties to a proceeding

[9]
Chapter 2, Part 4 (s 39 to s 45) of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act) is headed “Parties to a proceeding”. Section 39 deals with parties to original jurisdiction. Section 40, which is relevant here, deals with parties to review jurisdiction.
[10]
Section 40 provides:

40
PARTIES TO REVIEW JURISDICTION

(1)
A person is a party to a proceeding in the tribunal’s review jurisdiction if the person is—

(a)
the applicant; or

(b)
the decision-maker for the reviewable decision the subject matter of the proceeding; or

(d)
joined as a party to the proceeding under section 42; or

(e)
someone else an enabling Act states is a party to the proceeding.

(2)
In a proceeding in the tribunal’s review jurisdiction, so far as is practicable, the official description of the decision-maker must be used as the party’s name instead of the decision-maker’s name.

[11]
Relevantly, s 40 does not include a provision like s 39(b) which provides that a person is a party to a proceeding in the tribunal’s original jurisdiction if the person is “a person in relation to whom a decision of the tribunal is sought by the applicant.”
[12]
Section 42 gives the Tribunal power to make an order joining or removing a person as a party to the proceeding.
[13]
Under s 42(1) the tribunal may make an order joining a person as a party if the tribunal considers that:

(a)
the person should be bound by or have the benefit of a decision of the tribunal in the proceeding; or

(b)
the person’s interests may be affected by the proceeding; or

[14]
Under s 42(2) the tribunal may order that a party be removed from a proceeding if:

(a)
the party’s interests are not, or are no longer, affected by the proceeding; or

(b)
the party is not a proper or necessary party to the proceeding, whether or not the party was one originally.

The applicant’s submissions

[15]
In respect of both the homeowners and subcontractors, the applicant submits that they ought not be removed, because their presence is necessary to:
1. (a)
  Ensure that the Tribunal complies with its obligations under ss 3 and 20 of the QCAT Act, namely to:
  1. (i)
    deal with matters in a manner that is accessible, fair, just, economical, informal and quick; and
  1. (ii)
    produce the correct and preferable decision;
2. (b)
  avoid conflicting and inconsistent proceedings based on the same facts; and
3. (c)
  save costs by not having to litigate the same matters twice.
[16]
Further, in respect of the homeowners it is submitted that they should remain as parties because their interests are affected by the proceeding given Natter Pty Ltd seeks orders that the direction to rectify be set aside; if removed, they may commence their own review; they have made no application to be removed from the proceeding; and the decision sought to be reviewed encompasses items that were the subject of a Settlement Deed between the applicant and the homeowners which is a relevant consideration under s 72(3) of the Queensland Building and Construction Commission Act 1991 (Qld) (QBCC Act).
[17]
Further, in respect of the subcontractors it is submitted that they should remain as parties because their interests are affected by the proceeding, given Natter Pty Ltd wants the decision set aside and a direction issued to the subcontractors and, in the event it is not set aside, that the subcontractors be ordered to repay Natter Pty Ltd for its costs in complying with the direction to rectify and which it has incurred to date as a result of their defective work; they will be denied procedural fairness if removed; they have made no application to be removed; and a multiplicity of proceedings would otherwise arise.

The Commission’s submissions

[18]
The Commission provided submissions neither consenting to nor opposing the removal of the homeowners and the subcontractors. The Commission contends that s 42(1) (joining a party) and s 42(2) (removal of parties) require similar considerations: whether a person’s interests are affected by the proceeding and whether a person is necessary for the purposes of the proceeding.
[19]
The Commission submits that, pursuant to s 40 of the QCAT Act, the homeowners and subcontractors are not parties to the proceeding simply because the review application listed them as respondents. Further, as there has been no order for joinder made under s 42, s 40(d) does not apply, nor is there a provision in the enabling Act which would cause the homeowners or subcontractors to be a party, in which case neither does s 40(e). In this case, it is submitted, the relevant question is one of joinder rather than removal.

The homeowners’ submissions

[20]
The homeowners submit that they are not parties to the review or, if they are, that they should be removed as parties.
[21]
Alternatively, it is argued that they should be removed in any event for the following reasons:
1. (i)
  they do not wish to be parties (relying on Coral Homes (Qld) Pty Ltd v Queensland Building Services Authority (No 2) [2012] QCATA 242;
2. (ii)
  they should not be drawn into costly and complex litigation in respect of directions to rectify;
3. (iii)
  the applicant’s complaints are better suited to judicial review and do not address s 72 of the QBCC Act;
4. (iv)
  the review is unmeritorious in that it attempts to shift responsibility to subcontractors against authority; and
5. (v)
  the proceeding will involve a dispute between the applicant and the tilers, which is not relevant to the homeowners’ position.
[22]
In relation to the alleged settlement, the homeowners say that the items in the direction to rectify were not the subject of the Deed of Settlement, which, in any event, is to be objectively construed, without reference to the subjective views of the homeowners.

Roya Tiling Pty Ltd’s submissions

[23]
Roya Tiling submits, similarly to the homeowners, that it is not a party to the review proceeding and as such, s 42(2) which confers power on the Tribunal to make an order that a party be removed cannot be applied to them. Roya submits that the proper course is for the tribunal to acknowledge that Roya was erroneously named as a respondent in the proceeding and to remove them as there was no jurisdiction to include them in the review.
[24]
In the alternative, if Roya is deemed to be a party, it should be removed under s 42(2). Roya submits it should be removed for the following reasons:
1. (i)
  the applicant has failed to comprehend the nature of the review;
2. (ii)
  the tribunal is, by s 3 of the QCAT Act, required to deal with matters in an economical and quick way and joining parties complicates matters and lengthens the duration that the matter will run;
3. (iii)
  it does not wish to be a party to the review;
4. (iv)
  it is not necessary for it to be joined on the basis:

the principal contractor remains liable to rectify any defective work the subject of a direction to rectify (Queensland Building Services Authority v Last Laugh Pty Ltd [2011] QCAT 263 at [17]);
a direction to rectify issued against subcontractors was not a potential outcome of the review in Body Corporate for Riverside Hamilton v Queensland Building and Construction Commission [2020] QCAT 65 at [20]); and
the principal contractor is responsible for the work of its subcontractors (ABG83 v Queensland Building and Construction Commission [2019] QCAT 386 at [37]) and, therefore, the party responsible for a direction to rectify.
1. (v)
  given the applicant intends to pursue Roya for its costs incurred in complying with a direction to rectify, the point raised in the applicant’s submissions regarding the avoidance of multiple proceedings is moot.

Consideration

[25]
The Tribunal may make an order for the joinder or removal of parties to a proceeding on the application of a person or on its own initiative.^[1]
[26]
The parties to a review proceeding are those set out in s 40 of the QCAT Act. They are:

(a)
the applicant; or

(b)
the decision-maker for the reviewable decision the subject matter of the proceeding; or

(d)
joined as a party to the proceeding under section 42; or

(e)
someone else an enabling Act states is a party to the proceeding.

[27]
The homeowners and the subcontractors do not fall within s 40. They are not the applicant; they were not joined to the proceeding under s 42 and the relevant enabling Act, the QBCC Act, does not state in respect of either the homeowner or the subcontractor, that they are a party to the review proceeding.
[28]
They were listed in the application for review as respondents and named as respondents in the initial directions and court file.
[29]
Given there was no basis for adding them as parties, it follows they should be removed. However, given the objects of the QCAT Act to deal with matters in a way that is accessible, fair, just, economical, informal and quick^[2] I propose to consider whether the parties should be formally joined to the proceedings. That approach is also consistent with the statutory obligation to conduct proceedings in an informal way that minimises costs to the parties, and is as quick as is consistent with achieving justice.^[3]
[30]
Section 42(3) provides that the tribunal may, on its own initiative, make an order joining a person as a party if the tribunal considers that:

(a)
the person should be bound by or have the benefit of a decision of the tribunal in the proceeding; or

(b)
the person’s interests may be affected by the proceeding; or

[31]
I am satisfied that the parties’ submissions, although directed to the issue of removal, adequately address this issue. Accordingly, I turn to consider the issue of joinder, having considered the parties’ submissions.

The nature of the review proceeding

[32]
The QBCC’s power to issue a direction to rectify is contained in Part 6, s 72 of the QBCC Act. Section 72 provides, relevantly:

72
POWER TO REQUIRE RECTIFICATION OF BUILDING WORK AND REMEDIATION OF CONSEQUENTIAL DAMAGE

(1)
This section applies if the commission is of the opinion that—

(a)
building work is defective or incomplete; or

(b)
consequential damage has been caused by, or as a consequence of, carrying out building work.

(2)
The commission may direct the person who carried out the building work to do the following within the period stated in the direction—

(a)
for building work that is defective or incomplete—rectify the building work;

(b)
for consequential damage—remedy the damage.

…

(3)
In deciding whether to give the direction, the commission may take into consideration all the circumstances it considers are reasonably relevant and, in particular, is not limited to a consideration of the terms of the contract for carrying out the building work (including the terms of any warranties included in the contract).

…

(5)
The commission is not required to give the direction if the commission is satisfied that, in the circumstances, it would be unfair to the person to give the direction.

Example for subsection (5)—

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

(6)
The commission may, before it considers whether building work is defective or incomplete, require the consumer for the building work comply with a process established by the commission to attempt to resolve the matter with the person who carried out the work.

(7)
In subsection (3) , a reference to a contract for carrying out building work includes a reference to a domestic building contract for managing the carrying out of building work.

(8)
To remove any doubt, it is declared that the commission may act under this section in relation to consequential damage whether or not an owner or occupier has made a request under section 71J .

[33]
The QBCC has a discretion whether to give a direction. In exercising its discretion, the QBCC may take into consideration “all the circumstances it considers are reasonably relevant”.
[34]
The exercise of the discretion in s 72(2) is conditioned on the QBCC forming an opinion that, relevantly, building work is defective or incomplete. “Building work” includes the construction of a building. “Defective” is defined to mean “in relation to building work, includes faulty or unsatisfactory.” A direction cannot be given more than six years and six months after the building work to which the direction relates, was completed.^[4]
[35]
Section 72A(1) provides that a direction to rectify may be given to more than 1 person for the same building work.
[36]
Section 71I sets out, for the purposes of Part 6, who is taken to carry out building work. The section includes relevantly, a building contractor whose name is on the contract for carrying out the building work (s 71I(c)); a building contractor by whom the building work was carried out (s 71I(h)) and a person who, for profit or reward, carried out the building work (s 71I(i)).
[37]
Section 71I(2) provides:

For the purposes of subsection (1)(h) and (i) —

(a)
a person carries out building work whether the person—

(i)
carries it out personally; or

(ii)
directly or indirectly causes it to be carried out; and

…

[38]
The direction to rectify the defective tiling work could, pursuant to the provisions of the QBCC Act set out above, have been issued to either or both the principal contractor and the tiling subcontractor/s who carried out the work personally for reward. The Tribunal, on review, would be prevented from setting aside the decision and substituting it for a decision to issue the direction to rectify to the subcontractor/s unless the subcontractor/s had been parties to the proceedings. In circumstances where that outcome may be the correct and preferable decision, it is desirable, in my view, the subcontractors be joined.
[39]
Further, although the principal contractor is responsible under the contract to the homeowners for the work of its subcontractors,^[5] the issue on review is whether the correct and preferable decision is to issue a direction to rectify to the principal contractor in circumstances where the defective work was performed by a subcontractor and the subcontractor is identified and solvent.
[40]
It may be that the correct and preferable decision is to set aside the decision of the Commission and to issue the direction to rectify, with all its attendant consequences,^[6] directly to the person who performed the defective work.^[7] Such an outcome would, in my view, be consistent with the policy and purpose of Part 6 of the QBCC Act which deals with the rectification of building work. It also ensures that the person “through whose fault the claim arose” is not taken by surprise should the Commission elect, pursuant to s 71 of the QBCC Act, to recover any payment on a claim under the statutory insurance scheme as a debt from that person.
[41]
The Tribunal on review will be constrained in its options if the subcontractors are not joined. It would not, for example, be possible to issue a direction to rectify to the subcontractors on review if the subcontractors were not parties to the proceedings. This is a factor in favour of joining the subcontractors to the proceeding. They are, for that reason, affected parties. Joining the subcontractors also potentially removes the prospect of a multiplicity of proceedings. For example, if the principal contractor was unsuccessful in the review proceeding and the subcontractors were not joined, the principal contractor may institute proceedings against the subcontractors to recover its costs in complying with the direction to rectify.
[42]
The matter which complicates the position of the homeowners is the Settlement Deed. There is a dispute about the effect of the Settlement Deed. The homeowners say that the Settlement Deed does not include work the subject of the direction to rectify. The builder contends that the Commission failed to take into account the Settlement Deed when issuing the direction. Although the Settlement Deed is written, and must be objectively construed, there is dispute as to what it means. In the circumstances it is preferable that the homeowners be parties to the proceeding so as to be bound by the result. The extent to which they wish to participate is a matter for them. They may, for example, be prepared to abide by the Tribunal’s decision and may indicate that to the Tribunal at an early stage. The homeowners should raise this with the conference adjudicator at the compulsory conference which will follow this decision.
[43]
In view of the above, I find that the subcontractors and homeowners are each necessary parties to the proceeding. Accordingly, I do not make orders for their removal but, in view of s 40(1)(d), formally join those parties to the proceeding under s 42. The matter is to be listed for a compulsory conference on a date and time to be advised.

Footnotes

[1] QCAT Act, s 42(3).

[2] QCAT Act, s 3(b).

[3] QCAT, s 4(c).

[4]Queensland Building and Construction Commission Act 1991 (Qld), s 72A(4).

[5]Jobling t/as SAJ Constructions v Queensland Building and Construction Commission [2021] QCAT 219; Queensland Building Services Authority v Last Laugh Pty Ltd [2011] QCAT 263 at [17]; ABG83 Pty Ltd v Queensland Building and Construction Commission [2019] QCAT 386 at [37].

[6] The direction to rectify appears on a public register against the name of the person to whom the direction is issued. A failure to comply with a direction to rectify is an offence, there is potential for an insurance claim to be made by the homeowner against the statutory home insurance scheme and potential for subrogated action against the person through whose fault at fault for the amount of any insurance claim.

[7] See, for example, Imperial Homes (Queensland) Pty Ltd v Queensland Building and Construction Commission [2014] QCAT 42 where the Tribunal set aside a direction to rectify issued to the builder in circumstances where it was the slab/footing design by the engineer that was in issue, not defective construction.

Editorial Notes

Published Case Name:
Natter Pty Ltd t/as Stroud Homes Gold Coast v Queensland Building and Construction Commission & Ors
Shortened Case Name:
Natter Pty Ltd t/as Stroud Homes Gold Coast v Queensland Building and Construction Commission
MNC:
[2023] QCAT 208
Court:
QCAT
Judge(s):
Senior Member Traves
Date:
16 Jun 2023

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Cases Cited List of Cases Cited by this judgment

Case Name	Full Citation	Frequency
ABG83 Pty Ltd v Queensland Building and Construction Commission	[2019] QCAT 386	2 citations Jump To Cite 1 - [2019] QCAT 386 Cite 2 - [2019] QCAT 386
Body Corporate for Riverside Hamilton v Queensland Building and Construction Commission	[2020] QCAT 65	1 citation Jump To Cite 1 - [2020] QCAT 65
Coral Homes (Qld) Pty Ltd v Queensland Building Services Authority (No 2)	[2012] QCATA 242	1 citation Jump To Cite 1 - [2012] QCATA 242
Donovan Hill Pty Ltd v McNab Constructions Australia Pty Ltd	[2015] QCA 114	1 citation Jump To Cite 1 - [2015] QCA 114
Imperial Homes (Queensland) Pty Ltd v Queensland Building and Construction Commission	[2014] QCAT 42	1 citation Jump To Cite 1 - [2014] QCAT 42
Jobling t/as SAJ Constructions v Queensland Building and Construction Commission	[2021] QCAT 219	1 citation Jump To Cite 1 - [2021] QCAT 219
Queensland Building Services Authority v Last Laugh Pty Ltd	[2011] QCAT 263	2 citations Jump To Cite 1 - [2011] QCAT 263 Cite 2 - [2011] QCAT 263

Cases Citing List of cases on Queensland Judgments citing this Judgment

No judgments on Queensland Judgments cite this judgment.

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Natter Pty Ltd t/as Stroud Homes Gold Coast v Queensland Building and Construction Commission[2023] QCAT 208