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  4. TCQ Pty Ltd ATF Midgley Family Trust v Queensland Building and Construction Commission - [2023] QCAT 485

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TCQ Pty Ltd ATF Midgley Family Trust v Queensland Building and Construction Commission[2023] QCAT 485

TCQ Pty Ltd ATF Midgley Family Trust v Queensland Building and Construction Commission[2023] QCAT 485

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:

TCQ Pty Ltd ATF Midgley Family Trust v Queensland Building and Construction Commission & Anor [2023] QCAT 485

PARTIES:

TCQ Pty LTD ATF Midgley family trust

(applicant)

v

Queensland building and construction commission

Matthew James Brewster

(respondents)

APPLICATION NO/S:

GAR317-20

MATTER TYPE:

General administrative review matters

DELIVERED ON:

13 December 2023

HEARING DATE:

4 May 2023

HEARD AT:

Brisbane

DECISION OF:

Member Paratz AM

ORDERS:

  1. The Internal Review decision made on 31 July 2020 is set aside.
  2. It is declared that complaints and requests for rectification of building work or remediation of consequential damage were made as to Items 1, 2 and 3 listed in the Resolution Services Initial Inspection Report dated 22 May 2020 to the Queensland Building and Construction Commission by TCQ Pty Ltd as trustee for the Midgley Family Trust within time pursuant to sections 72A(4) and 71J(4) of the Queensland Building and Construction Commission Act 1991 (Qld) and Clauses 3(1) and 3(2) of the Rectification Policy of the Queensland Building and Construction Commission.

CATCHWORDS:

ADMINISTRATIVE REVIEW – ADMINISTRATIVE TRIBUNALS – QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL – where an internal review decision of the Queensland Building and Construction Commission made a decision as to the giving of a Direction to Rectify – where the building company was de-registered as a company – where a notice as to work required was given to a person who had been a director of the building company – whether the decision as to the giving of a notice to the Director, which was being sought to be reviewed, was a reviewable decision – whether the owner had given notice within time to the Queensland Building and Construction Commission within 12 months of becoming aware of the defective work – where no insurance decision had been made under the statutory insurance scheme – where a declaration was made as to whether the owner had given notice within time

Queensland Building and Construction Commission Act 1991 (Qld) s 71J, s 72, s 72A

Queensland Building and Construction Commission Rectification Policy, cl 3

ACN 148 877 525 Pty Ltd v Queensland Building and Construction Commission [2022] QCAT 72

Australian Broadcasting Tribunal v Bond [1990] HCA 33

Barry & Anor v Queensland Building and Construction Commission [2015] QSC 50

Lee Anthony Crocker v Queensland Building and Construction Commission [2020] QSC 24

Walker v Queensland Building and Construction Commission [2021] QCAT 32

APPEARANCES & REPRESENTATION:

 

Applicant:

Self-represented by its Director Mr T Midgley

Respondent:

QBCC – S. Tabaiwalu, Legal Officer QBCC

Matthew Brewster – Self-represented

REASONS FOR DECISION

  1. [1]
    This is the hearing of a Review of an Internal Review decision of the Queensland Building and Construction Commission (‘QBCC’) made on 31 July 2020.
  2. [2]
    TCQ Pty Ltd as trustee for the Midgley Family Trust (‘the Owner’) contracted on 1 July 2012 with MKB Group Pty Ltd (‘the Builder’) to construct a new house at premises at Mt. Isa for the amount of $770,000.
  3. [3]
    Mr Midgley is an officer of TCQ Pty Ltd, and represents the Owner.
  4. [4]
    Matthew James Brewster was a director of the company MKB Group Pty Ltd (‘the Director’). That company was deregistered on 6 August 2017.
  5. [5]
    The building works commenced on 31 July 2012, and practical completion was achieved on 4 July 2014.
  6. [6]
    The owner lodged a complaint case ID 210504 with the QBCC on 22 January 2017 which was for 21 defective items. That complaint progressed to insurance claim case ID 260998. A rectifying contractor carried out the rectification work under insurance for 12 of the initial 21 defective items.[1]
  7. [7]
    The Owner submitted a separate complaint form to the QBCC on 17 February 2020 alleging defective work by the builder in respect of 3 items as follows:
    1. water ingress
    2. subfloor ventilation
    3. glass barriers which did not comply with the Building Code of Australia
  8. [8]
    The QBCC advised the Owner on 5 June 2020 that it would not be directing the Builder to rectify any of those 3 complaint items, as the builder was de-registered.
  9. [9]
    The QBCC issued a separate Notice to the Director on 5 June 2020, advising that it would not be directing the Builder to rectify any of the complaint items as the Builder was not registered and went on to say:

…however if the work detailed in the attached defective work list is not addressed, the QBCC will assess TCQ Pty Ltd ATF Midgley Family Trust’s entitlement to a claim under the Queensland Home Warranty Scheme.

The QBCC may recover payment made on an insurance claim as a debt from the building contractor or a director (including a direct or at the time the building work was carried out and a director at the time a payment is made by the QBCC).

Even if you are no longer a current director, you are still personally responsible under the Queensland Building and Construction Commission Act 1991 for any work carried out because you were a director of MKB group Pty Ltd

  1. [10]
    The Director sought an Internal Review of a decision of the QBCC of 5 June 2020. The decision he was seeking to review was the decision to issue the Notice to him entitled ‘Work by a licensed contractor is required.’ The application for an internal review of that decision was made by Solicitors acting on behalf of the Director as follows:[2]

Decision to be reviewed

  1. On or about 5 June 2020, the QBCC issued our client with a document entitled ‘Work by a Licensed Contractor Is Required ‘which enclosed:
  1. a)
    a defective work list reference number 0106213 (‘Defective Works List’) and
  2. b)
    a copy of a Resolution Services Initial Inspection report dated 22 May 2020 (‘the Initial Report’)
  1. By the letter dated 5 June 2020, the QBCC advised that it had determined that, in respect of three specified items (‘the Defective Works’), defective or incomplete building work had been carried out by (MKB Group Pty Ltd) at the premises and that work by a licensed contractor was required (‘the Decision’).
  1. Our client formally applies for an internal review of the Decision. The relevant particulars of the decision are:
  1. a)
    Date of decision – 5 June 2020
  2. b)
    Decision maker – Kevin Cameron
  3. c)
    QCAT – Not applicable
  4. d)
    Point of contact – Cohen Legal
  1. The basis of our client’s application for internal review is that the Decision:
  1. a)
    does not comply the requirements of the Queensland Building and Construction Commission Act 1991(Qld) (‘the Act’)
  2. b)
    does not comply the requirements of the QBCC Rectification Of Building Work Policy effective 10 October 2014 (‘the policy’); and
  3. c)
    is otherwise unfair for the purposes of section 72(5) of the Act
  1. [11]
    An Internal Review Decision was then made on 31 July 2020. The Internal Review decision described in its headnote that the applicant for an internal review was the Director, however stated that the decision under review was ‘Decision not to issue a Direction to Rectify under section 72 of the Queensland Building and Construction Commission Act 1991’ (‘QBCC Act’).
  2. [12]
    The Owner was named as an ‘affected party’ in the headnote of the Internal Review decision.
  3. [13]
    The Internal Review found that the complaint had not been made within 12 months of the owner becoming aware of the defective work; that it would be unfair to direct rectification of the work; and decided not to issue a direction for the complaint items 1, 2 and 3 of the complaint form dated 17 February 2020.
  4. [14]
    The Owner then filed an Application in the Tribunal on 28 August 2020 to Review the Internal Review decision made on 31 July 2020.

The Internal Review Decision and these proceedings

  1. [15]
    This matter highlights the difficulties that can arise where the QBCC documentation and processes confuse its activities under one of its functions (its Consumer Protection function by the giving of a Direction to Rectify) with its activities under another of its functions (its Insurance function under the Statutory Insurance Scheme).
  2. [16]
    This matter is very confused, as the Director sought an Internal Review of a notice that advised him that work by a licensed contractor was required. The Director was not seeking to review the decision not to give a Direction to Rectify to the builder.
  3. [17]
    The Director was seeking to overturn the decision to give him a Notice that if the defects were not rectified, and if the QBCC incurred cost to rectify the defects under the statutory insurance scheme, that the QBCC may recover payment from him as a director of the company.
  4. [18]
    The Internal Review Decision Notice however addressed a different question of whether a Direction to Rectify should have been given.
  5. [19]
    I was advised that at the time of the Internal Review, and still at the time of the hearing, that no insurance decision had been made.
  6. [20]
    The Internal Review decision made on 31 July 2020 says that the QBCC advised the Director by letter dated 5 June 2020 of its decision to give a Notice of Defective Works. It goes on to describe a Notice of Defective Works in the following terms:[3]

A notice of defective work is not a Direction to Rectify under s. 72 of the QBCC act and is taken to be a decision not to give a Direction to Rectify.

  1. [21]
    The Internal Review Decision Notice does not give any authority for the proposition that a Notice of Defective Work ‘is taken to be a decision not to give a Direction to Rectify,’ and no such authority was referred to in any of the submissions in this matter.
  2. [22]
    It appears that the QBCC internally may ‘take’ a Notice of Defective Work to be a decision not to give a Direction to Rectify, but that equivalence has not been substantiated.
  3. [23]
    Section 86 of the QBCC Act provides a list of decisions of the QBCC that are ‘reviewable decisions.’ That section does not refer to the giving of a Notice of Defective Work as a ‘reviewable decision.’
  4. [24]
    The definition of a reviewable decision was discussed by the Chief Justice of the High Court, Chief Justice Mason, in Australian Broadcasting Tribunal v Bond.[4] His Honour noted that a reviewable decision is one which is generally final or operative and determinative, and that a conclusion reached as a step along the way to a decision would not ordinarily be a reviewable decision, as follows:

32. The policy arguments do not, in my opinion, call for an answer different from that dictated by the textual and contextual considerations. That answer is that a reviewable "decision" is one for which provision is made by or under a statute. That will generally, but not always, entail a decision which is final or operative and determinative, at least in a practical sense, of the issue of fact falling for consideration. A conclusion reached as a step along the way in a course of reasoning leading to an ultimate decision would not ordinarily amount to a reviewable decision, unless the statute provided for the making of a finding or ruling on that point so that the decision, though an intermediate decision, might accurately be described as a decision under an enactment.

  1. [25]
    An analogous situation can be seen in Lee Anthony Crocker v Queensland Building Construction Commission[5] where Justice Jackson of the Supreme Court of Queensland considered the giving of a notice as to the liability of a director for a payment made by the commission on a claim under the insurance scheme under s 111C of the QBCC Act was not a decision, as follows:

25. In my view, there is no such decision made under section 111C of the QBCCA. The notices which the applicant seeks to have invalidated have no legal effect as such and were not preceded by a decision under section 111C imposing liability as such. The notices were nothing more or less than a demand for payment. Liability under section 111C of the act does not depend on the making of a demand.

  1. [26]
    Those observations of Justice Jackson were applied by Acting Senior Member Traves in ACN 148 877 525 Pty Ltd v Queensland Building and Construction Commission,[6] in which she discussed the procedure for liability of directors for amounts paid under the insurance scheme as follows:

53 This provision allows the QBCC to recover the insurance debt from the directors personally, thereby displacing the common-law separate entity principle. This applies notwithstanding the company may have been deregistered. The decision as to whether or not to recover the insurance debt is made after the scope of works decision and depends upon whether the person from whom recovery is sought was a director when the relevant building work was carried out and when the payment under the scheme was made.

  1. [27]
    It is not established in this matter that the giving of the Notice of Defective Work to the Director was a reviewable decision. It is best seen as an advisory notice and was not at the status of a decision.
  2. [28]
    The Reasons of the Internal Review decision confuse the issue of giving a Direction to Rectify to the builder with another issue, regarding the giving of a Notice to the Director as to recovery of costs in the event of a successful insurance claim.
  3. [29]
    I raised the issue as to whether the proceedings were properly brought at the commencement of the hearing. The parties wanted to proceed to have the underlying issues determined.
  4. [30]
    The submissions of the parties revolve around the questions of whether notice was given in time to the QBCC as applicable to the giving of a Direction to Rectify, and whether it would have been fair to issue a Direction to Rectify.
  5. [31]
    Those are issues that would have been considered by Mr Cameron in relation to the builder, if the builder had not been de-registered, and are also issues that may arise in relation to any insurance claim consideration.
  6. [32]
    One course I could adopt is to simply set aside the Internal Review Decision made on 31 July 2020 on the basis that the issuing of the Notice of Defective Work was not reviewable – but that would leave the substantive issue as to time undetermined.
  7. [33]
    Having regard to:
    1. the time this matter has occupied to date;
    2. that it concerns work that was done in 2012 to 2013;
    3. that two of the parties are self-represented;
    4. and that no insurance decision has been made;

I consider that it is preferable in the interests of justice; and in accordance with the objects of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) to have the Tribunal deal with matters in a way that is accessible, fair, just, economical, informal and quick;[7] to proceed to consider the substantive issue as to time, without further proceedings needing to be initiated or pursued.

  1. [34]
    I will therefore set aside the Internal Review Decision, but also proceed to consider the fundamental underlying issue as to whether a complaint and request for rectification of building work or remediation of consequential damage was made in time, and make a Declaration accordingly.

Relevant legislation

  1. [35]
    Section 71J of the QBCC Act provides as follows:

71J Requests for rectification of building work or remediation of consequential damage

  1. A consumer may ask the commission to give a Direction to Rectify building work the consumer considers is defective or incomplete.
  1. The owner or occupier of a residential property adjacent to a building site may ask the commission to give a direction to remedy any consequential damage to the property.
  1. A person making a request under subsection (1) or (2) must give the commission—
  1. details of—
  1. for a request under subsection (1)—the building work the consumer considers is defective or incomplete; or
  1. for a request under subsection (2)—the consequential damage to the property; and
  1. other details the commission reasonably requires to consider the request; and
  1. the fee prescribed by regulation.
  1. Also, a request under subsection (1) or (2) must be made within 12 months after the person becomes aware of—
  1. for a request under subsection (1)—the building work the person considers is defective or incomplete; or
  1. for a request under subsection (2)—the consequential damage to the property.
  1. [36]
    Section 72 of the QBCC Act provides as follows:

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—
  1. building work is defective or incomplete; or
  1. consequential damage has been caused by, or as a consequence of, carrying out building work.
  1. The commission may direct the person who carried out the building work to do the following within the period stated in the direction—
  1. for building work that is defective or incomplete—rectify the building work;
  1. for consequential damage—remedy the damage.

(2AA) A regulation may prescribe a period within which the commission must make the direction.

(2A) If a period is prescribed under subsection (2AA), the commission must make the direction during the prescribed period.

  1. In deciding whether to give the direction, the commission may take into consideration all the circumstances it considers are reasonably relevant and, in particular, is not limited to a consideration of the terms of the contract for carrying out the building work (including the terms of any warranties included in the contract).
  1. The period stated in the direction must be the period prescribed by regulation unless the commission is satisfied that, if the direction is not required to be complied with within a shorter period–
  1. a substantial loss will be incurred by, or a significant hazard will be caused to the health or safety of, a person because of the defective or incomplete building work or consequential damage; or
  1. the defective or incomplete building work, or consequential damage, will cause a significant hazard to public safety or the environment generally.
  1. 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.

  1. 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.
  1. 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.
  1. 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.
  1. [37]
    Section 72A of the QBCC Act provides as follows:

72A Powers and limitations of directions to rectify or remedy

  1. A Direction to Rectify or remedy may be given to more than 1 person for the same building work.
  1. A Direction to Rectify or remedy may require that a building, or part of a building, be demolished and building work be recommenced if, in order to rectify building work, it is necessary to do so.
  1. If a Direction to Rectify or remedy is given to a person who is not currently licensed to carry out the required work, the person must have the work carried out by a licensed contractor.
  1. A Direction to Rectify or remedy cannot be given more than 6 years and 6 months after the building work to which the direction relates was completed or left in an incomplete state unless the tribunal is satisfied, on application by the commission, that there is in the circumstances of a particular case sufficient reason for extending the time for giving the direction and extends the time accordingly.
  1. The fact that a direction is given under section 72(2) does not prevent the commission from taking additional action against a person under this Act for the building work to which the direction relates.
  1. [38]
    The Rectification Policy provides at Section 3 as follows:
  1. Notification of Defects
  1. It is a policy of the Board that if a consumer is seeking the assistance of the Queensland Building and Construction Commission (QBCC) to issue a direction to a building contractor or to rectify defective building work, the consumer must lodge a formal complaint with the QBCC of defective building work as soon as possible but no later than within 12 months of becoming aware of the defects.
  1. The QBCC will then consider the issuing of a Direction to Rectify to a building contractor:
  1. for structural defective building work, within 6 years and 3 months of the building work being completed; or
  2. for non-structural defective building work, within 12 months of the building work being completed.

Note:  this policy is not intended to extend manufacturer’s product warranties, including white goods.

  1. [39]
    Practical Completion is defined in Schedule 1B of the QBCC Act as follows:

Practical Completion, for a domestic building contract, means the day when the subject work is completed—

  1. in compliance with the contract, including all plans and specifications for the work and all statutory requirements applying to the work; and
  1. without any defects or omissions, other than minor defects or minor omissions that will not unreasonably affect occupation; and
  1. if the building owner claims there are minor defects or minor omissions—the building contractor gives the building owner a defects document for the minor defects or minor omissions.

Submissions of the Owner

  1. [40]
    The owner submits that building work was undertaken under a standard building contract dated 1 July 2012, that the builder was MKB Group, and that TCQ Pty Ltd ATF the Midgley Family Trust was identified as the owner.[8]
  2. [41]
    It contended that all parties agreed that item 2 (sub floor ventilation) and item 3 (front balustrade) are defective,[9] and submitted that the QBCC inspector, Mr Cameron, provided detailed explanations as to why the building works were defective.
  3. [42]
    It submitted that item 1 (water ingress into entry from ceiling) must have been related to the original work, as Mr Cameron confirmed that the builder engaged by the statutory insurance scheme, who had completed some work on the house, had not completed any work in that area of the house.
  4. [43]
    It submitted that the builder should be responsible for items 2 and 3 as these were as originally built. It described item 1 as being an ongoing issue to the homeowner, as works were conducted in this area under a Direction to Rectify given in 2017 by a third party under the direction of the builder, and that the builder was responsible for the work causing the leak.
  5. [44]
    The owner submits that it considers that it identified the items as being defective on dates as follows:[10]
    1. For item 1 the applicant considered the work of Brewster to be defective following the inspection of Shane Bax on behalf of the QBCC on the 22 May 2020.
    2. For item 2 the applicant considered the work of Brewster to be defective after the residence was viewed by a 3rd party certifier in January 2020.
    3. For item 3 the applicant considered the work of Brewster to be defective after the residence was viewed by a 3rd party certifier in January 2020.
  6. [45]
    As to practical completion, the owner submits that practical completion has never been met with respect to section 67A of the QBCC Act, due to the fact that category 1 defects still exist in the property.[11] The owner appears to argue that therefore the requirements in section 72A(4) of the QBCC Act, as to notice required to be given within 6 years and 6 months after the building work to which the direction relates was completed, do not apply.
  7. [46]
    Alternatively, the owner submits that the date of possession of the house is extremely ambiguous and that if it was occupied on 4 July 2014 as stated by the Director, that the QBCC Act could be interpreted that ‘the 6 year and 6 month time stipulated under S 72A then falls at 4th January 2021, against this date this claim was made 12 months prior to that date.’[12]
  8. [47]
    Further alternatively, the owner submits that further time consideration needs to also be given to item 1 as it alleges these works were only completed in 2017 under a previous Direction to Rectify and in that case ‘the Act could also be interpreted that these works are covered under S 72A until late 2023 being 6 years and 6 months after they were completed.’[13]
  9. [48]
    As to whether it would be fair to issue a Direction to Rectify, the owner submits that:[14]

In agreeing to build a house a builder is fully aware of their obligations under the relevant legislation and the importance of adherence to standards, compliance with relevant guidelines and manufacturer requirements to produce a property without defects. The consumer in most cases is not familiar with any of these things and puts their trust, a significant investment and their faith that the builder is going to fulfil their obligations. So when the builder doesn’t, is it fair to issue them a Direction to Rectify, of course it is.

Submissions of the Director

  1. [49]
    The Director advised in his submissions that the builder did not construct any more houses after the completion of a house in March 2013.[15]
  2. [50]
    The Director submitted that he had the right to have the notice from the QBCC, which personally instructed him to fix items 1, 2 and 3, reviewed in his personal capacity as a previous director, and personally sourced legal advice with an internal review submission made within the required timeframe.[16]
  3. [51]
    He submitted that the owner had not disproved the completion date as being at hand-over on 29 March 2013.
  4. [52]
    He submitted that the owner was solely responsible for the delay in enabling the certifier to inspect the property and issue the form 21 Practical Completion Certificate in August 2014.[17]
  5. [53]
    He submitted that the time for submission of a claim by the owner was 29 September 2019, as follows:[18]

13. The date of practical completion was 29 March 2013. The date the applicant had to submit the complaint form was the 29 September 2019. It is unfortunate the applicant has experienced another leak however given the sufficient timeline the applicant had to submit another complaint form and did not adhere to these timelines.

14. The applicant is out of time to have the QBCC to issue a DTR or submit a claim under the Home Warranty Scheme.

Submissions of the QBCC

  1. [54]
    The QBCC noted that on 17 February 2020 it received a Residential and Commercial Construction Complaint Form from the owner against the builder for 3 items of defective building work which were described as follows:[19]
  1. a)
    Water leaking into entry from above previous complaint #210503. Subsequent leaking has caused electrical and gyprock damage. QBCC notified Jan 2019. First noted the defect on 1 November 2013.
  2. b)
    Subfloor ventilation does not meet BCA. First noticed the defect on 1 December 2016.
  3. c)
    Front veranda glass does not meet BCA. First noticed the defect on 1 December 2016.
  1. [55]
    The QBCC submitted that an initial inspection report as to the items was produced dated 22 May 2020, and described its determinations and actions as follows:[20]
  1. Based on the initial inspection report, the Commission made the determination that the defective items were structural defects, and that Direction to Rectify be given as follows:
  1. a)
    Defective Item one (1) - Direction to Rectify to the original builder for both the defect and consequential damage to the entry ceiling.
  2. b)
    Defective Item two (2) – direction to the original builder
  3. c)
    Defective Item three (3) – Direction to Rectify to the original builder.
  1. On 22 May 2020, the Commission gave to Matthew Brewster, the contractor’s former director, a draft of the initial inspection report inviting submissions by 5 June 2020.
  1. On 5 June 2020, the Commission advised the Applicant of its decision not to direct the Contractor as it was de-registered. The Commission advised the Contractor’s directors to engage a licensed contractor to carry out the rectification work in light of its de-registration status.
  1. On 3 July 2020, Cohen Legal lodged an internal review application for the Contractor in regard to the decision dated 5 June 2020.
  1. On 31 July 2020, the Commission advised the Applicant and Cohen Legal of the Decision.
  1. [56]
    The QBCC submitted that in making the decision to give a Direction to Rectify, the Tribunal standing in the shoes of the Commission must be satisfied that:[21]
  1. a)
    ‘building work’ was undertaken or carried out for the purpose of the QBCC Act;
  2. b)
    the ‘building work’ was defective and/or incomplete for the purpose of the QBCC Act and/or Rectification Policy;
  3. c)
    the person to be issued with the direction is responsible for the defective and/or incomplete ‘building work’ for the purpose of the QBCC Act;
  4. d)
    the timeframes on the QBCC Act and Rectification Policy were complied with including whether the decision to give a direction is within the statutory time frame for the purposes of the QBCC Act and Rectification Policy; and
  5. e)
    it is fair, in all the circumstances, to exercise the discretion to issue a direction to the person who is responsible for the building work for the purpose of the QBCC Act.
  1. [57]
    It submitted that there was no contention as to the work being ‘building work’, being structurally defective, and that the builder carried out the work.[22]
  2. [58]
    It submitted that as there is no contention as to those matters, that the issues that remain to be determined by the Tribunal in this proceeding are as follows:[23]
  1. a)
    Whether the timeframes in the QBCC Act and Rectification Policy were complied with, including whether the decision to give a direction is within the statutory timeframe for the purposes of the QBCC Act and Rectification Policy; and
  2. b)
    If it is fair, in all the circumstances, to exercise the discretion to issue a direction to the person who is responsible for the building work for the purpose of the QBCC Act.
  1. [59]
    As to timeframes, the QBCC submits that the time limitation of 12 months in which to lodge a complaint to the commission had expired at the time the complaint was lodged by the owner, pursuant to section 71J(4) of the QBCC Act and clause 3 of the Rectification Policy,[24] and that there is no discretion in the commission to extend the 12 month timeframe.[25]
  2. [60]
    It noted that the status of the Rectification Policy of the QBCC was described by Member Gordon as having ‘high significance’ in MacFarlane v Queensland Building and Construction Commission­,[26] who said as follows:

[14] This policy is promulgated on the QBCC’s website. The policy was made under section 19 of the QBCC Act by the Queensland Building and Construction Board, and was approved by regulation as required by section 19 (3). Although section 19 was repealed on 10 November 2017, by transitional provisions inserted at that time into section 76 of the QBCC Act by the Building Industry Fairness (Security of Payment) Act 2017 (Queensland), the policy continued in force. For that reason, the policy has high significance. This is emphasised by section 20K of the QBCC Act which requires the Commissioner to give effect to any policy or direction of the board relevant to the Commissioner’s responsibility. It is however, provided that the Commissioner must act independently of the board when making a decision about (amongst other things) rectification of building work.

  1. [61]
    It noted that Member Gordon went on to say[27] that the reason for the 12 month time limit for the complaint to be made is fairly clear to understand, as such defects need to be rectified as soon as possible to avoid further deterioration or consequential damage, and it is good policy to give the contractor early warning of the need for rectification work because a contractor is then more likely to find it easier to rectify, particularly if subcontractors have been used.[28]
  2. [62]
    The Commission submitted that the owner’s own statement indicates that the complaint as to item 1 was made after 12 months from his becoming aware of the defect:[29]

37. The applicant has argued as contained in his statement filed 17 March 2022, that he became aware of Defective Item 1 in January 2019, when he was informed by telephone by his tenant of a substantial water leak causing damage to the electrical meter box and the entry ceiling. When he called the Commission, he was told to make another complaint. No specific date was given regarding his call to the Commission. The complaint was lodged on 17 February 20, after the expiry of 12 months from January 2019.

  1. [63]
    The Commission notes that the owner argues that the relevant date for awareness in regard to defective items 2 and 3 was when he became aware on January 2020, during a pool fence inspection, that the front glass balustrade was actually a structural defect. The Commission submits that the awareness date under section 70 1J (4) of the QBCC Act and clause 3 of the Rectification Policy, refers to awareness of the defect, not as to the nature of the defect,[30] and refers to the decision in Walker v Queensland Building Construction Commission[31] as authority for the proposition that ‘aware’ is aware of a defect, not as to the nature of the defect.[32]
  2. [64]
    It notes that the owner raises issues as to when the work was completed under Section 72A(4) of the QBCC Act and refers to the decision of Flanagan J in Barry & Anor v Queensland Building and Construction Commission[33] who noted that the ordinary meaning of the word ‘completed’ involves an element of finality and an identifiable endpoint from which the time limit begins.
  3. [65]
    It submits that; as according to the Director the dwelling was completed on 29 March 2013, and that Mr Midgely moved into the dwelling on Mother’s Day of 2013, and that the final inspection certificate in Form 21 was dated 1 August 2014; that the building works to which the direction relates were completed on the issuing of the final inspection certificate on or about 1 August 2014, and a Direction to Rectify would have to have been given by 1 February 2021.

Discussion

  1. [66]
    An ‘initial inspection report’ was completed by Mr Cameron, the QBCC inspector in relation to the three complaints in question on 5 May 2020.
  2. [67]
    Mr Cameron noted that the owner had a previous dispute case 210504 as to defective works by the builder which went to insurance – case 260998, and that a QBCC insurance appointed builder had been to the property to rectify the defects not completed by the original builder.

The 12 month notice period 

  1. [68]
    Mr Cameron noted that complaint number 1 was described on the complaint form as ‘Water leaking into entry from above previous complaint #210503. Subsequent leaking has caused electrical and gyprock damage. QBCC notified Jan 2019.’[34]
  2. [69]
    Mr Cameron found that there were two separate situations in relation to this complaint. One as to water staining of a ceiling, and the other as to water staining of an exterior wall.
  3. [70]
    He found that the water staining location to the ceiling was located above the front entry area in the bulkhead, and that it would appear to be gaining entry into the ceiling bulkhead by a leak identified from the sliding glass door at the right-hand side on the upper deck where the flashing appears to be not installed as per the AWA and the substrate manufacturer installations. He found this to be a structural defect and the responsibility of the original builder as no works had been performed in this area from any other party.[35]
  4. [71]
    He found that severe water staining to the right-hand exterior wall in the foyer beside the steps indicated a point high up and at tread two and lower towards the front of the foyer, where the photographs indicate that the waterproofing and paint seal do not cover the exposed raw masonry walls at the footing level on the right-hand side of the entry; and from water entering the building from the fixing points holding up a leaking irrigation system which was directly over the area that appears to be short in waterproofing membrane installed by the insurance builder.
  5. [72]
    He found the external water entry to be the responsibility of the insurance builder who was to be required to rectify the waterproofing membrane to the exterior on the right-hand side of the residence and the consequential damage to the plasterboard on the right-hand side of the entry.
  6. [73]
    Both section 71J(4) of the QBCC Act and Clause 3 of the Rectification Policy require the consumer to ask the QBCC to issue a Direction to Rectify within 12 months after the person becomes aware of building work the person considers as defective or incomplete, or of consequential damage to the property.

Item 1

  1. [74]
    Mr Midgley stated that he did advise the QBCC by telephone about complaint item number 1 within a few days of being informed by the tenant, as follows[36]:

In January 2019 the applicant was contacted by the Lessee of the property (Queensland Health) by telephone notifying me of a substantial water leak causing damage to the electrical meter box and the entry ceiling. I contacted the QBCC within a few days of this call by telephone to Deborah Lawson who was managing the insurance repairs to the property which at that stage had not been fully completed, this is documented on page 73 of the statement of reasons.

The applicant states firstly the QBCC was advised within a few days of becoming aware of the leak well within the 12 month window.

Secondly work from the original complaint had not been completed at that point so it is believed by the Applicant that it is fair to make this follow-up call with respect to ongoing issues under the original complaint.

The QBCC forced the applicant to make another complaint which is not considered to be fair given the QBCC was still actively managing the original matter and subsequent repairs.

Yes it took some time to make the additional web based complaint however the QBCC was notified within a few days of the applicant being aware of the subsequent defect well within the 12 month window.

It is also worth noting that nowhere in the rectification policy does the policy define the manner in which a formal complaint can be made furthermore there is nothing detailed in the rectification policy excluding Lawson from accepting that call as a formal complaint.

  1. [75]
    Mr Midgley’s telephone conversation with Ms Lawson was in January 2019. The web-based complaint was lodged on 17 February 2020.
  2. [76]
    Section 71J(1) of the Act refers to ‘a request’ for rectification of building work in the section heading, and uses the words in s 71J(1) that a consumer ‘may ask’ the commission to give a direction to rectify building work the consumer considers is defective or incomplete.
  3. [77]
    I consider that Mr Midgley did make ‘a request’ to, and did ‘ask’ the QBCC, for rectification of building work by his telephone call to Ms Lawson in January 2019, which is not disputed to have been within days of his being advised of the leak by the tenant.
  4. [78]
    I also note that Mr Cameron in his ‘initial inspection report’ noted as to item number 1 that ‘QBCC notified Jan 2019’.[37]
  5. [79]
    The owner therefore did comply with the time period required by Section71J(4) of the Act as to advising the QBCC of item number 1.
  6. [80]
    Clause 3 of the Rectification Policy uses different language. It refers to the consumer having to lodge ‘a formal complaint’ within 12 months of becoming aware of the defects. The rectification policy does not describe how a ‘formal complaint’ is made.
  7. [81]
    I accept the submission of the owner that it was making a complaint about Item Number 1 in January 2019 in the telephone conversation between Mr Midgley and the QBCC in January 2019, and that in the absence of any definition of the difference between a complaint and a ‘formal complaint’, that a formal complaint was made by the owner in January 2019.
  8. [82]
    The owner did subsequently file a written complaint when asked to by the QBCC (Mr Midgley says he was ‘forced’ to do so). The subsequent filing of a written complaint does not invalidate the actual complaint that was made in January 2019.
  9. [83]
    Complaint 1 was therefore made, within time for the making of a complaint under both s 71J(4) of the Act, and Clause 3(1) of the Rectification Policy.

Items 2 and 3

  1. [84]
    Mr Cameron noted that complaint number 2 was described on the complaint form as ‘sub floor ventilation does not meet BCA.’
  2. [85]
    He found there was inadequate sub floor ventilation as required in the BCA 2012, and that the work was structural, faulty and unsatisfactory, and this was the responsibility of the original builder.[38]
  3. [86]
    Mr Cameron noted that complaint number 3 was described on the complaint form as ‘front veranda glass does not meet BCA.’
  4. [87]
    He found that the installed glass barriers to the front deck on the upper level did not comply with AS 1288, as no identification markings were evident on any of the glass barriers, they were not fitted to comply, and the top of the glass panels do not appear to be 1 metre above the balcony, and this was the responsibility of the original builder.
  5. [88]
    Mr Midgley stated that Mr Cameron made comment to him about items 2 and 3 at the time of the first inspection of the property in December 2016, said that he was only allowed to inspect the identified complaint items at the property, and that it was not until a pool fence inspection on 9 January 2020 that the owner became aware that the matters were in fact structural defects, as follows:[39]

1.4  With respect to the second defective item the date first noticed was entered in the web form as Dec 2016. This date is consistent with Cameron’s first inspection of the property, it was during that inspection that Cameron made comments about a number of items in the house including the front deck glass, underfloor ventilation, northern side stairs and balustrade.

When asked to provide further information on the matters Cameron informed me he was only allowed to inspect the identified complaint items at the property.

It wasn’t until the house was viewed during a pool fence inspection by Paul Austin of GMA Certification on the 9 January 2020 that the applicant became aware the front glass balustrade was actually a structural defect it was also at this point the dangers of the substandard barrier was pointed out to the applicant by Austin. A new complaint for this item was made in the following month of Feb 2020 well inside the 12 month window.

  1. [89]
    Mr Midgley made identical statements as to the third defective item.[40]
  2. [90]
    The actual comments made by Mr Cameron as to items 2 and 3 at the inspection in December 2016 have not been identified, but there is no suggestion that Mr Cameron advised the owner to lodge a complaint at that time on the basis of their being defects.
  3. [91]
    The owner lodged the complaint as to Items 2 and 3 shortly after being made aware by the pool fence inspector that they were serious defects.
  4. [92]
    The request to rectify and complaints as to items 2 and 3 therefore were also made within 12 months after the owner became aware of them as defects, and were also within time for the making of a complaint and request under s 71J(4) of the Act and Clause 3(1) of the Rectification Policy.

The limitation period

  1. [93]
    Section 72A(4) provides that a Direction to Rectify or remedy cannot be given more than six years and six months after the work was completed.
  2. [94]
    The director submits that the complaint, which was lodged on 17 February 2020, was outside the period provided for in s 72A(4) as the house was completed in March 2013, and therefore the period of six years and six months expired in June 2019.
  3. [95]
    In a submission, the director particularised the date of hand over as 29 March 2013 and submitted this was the date of practical completion:[41]

2. On Friday, 29 March 2013 MKB (MKB Group Pty Ltd) were not made aware of any major defects. Midgley never formally notified MKB of any major defects at time of ‘handover’. In accordance with the QBCC Act and QBCC Handover Policy this date Practical Completion was achieved as no further works under the contract were outstanding by MKB.

  1. [96]
    The owner submits variously that the complaint, which was lodged on 17 February 2020, was lodged within the period provided by s 72A(4), because either:
    1. practical completion has never been met, and therefore the period of six years and six months has not yet started to run; or
    2. that the period of six years and six months should run from the time of occupation on 4 July 2014, and therefore the complaint lodged on 17 February 2020 was within that period; or
    3. the period of six years and six months should run from the date in 2017 when the works were repaired under a Direction to Rectify, that being when the works were effectively completed, and the complaint lodged on 17 February 2020 was within that period.
  2. [97]
    The house has, on the owner’s submission, been lived in since 4 July 2014. Over the period between 4 July 2014 and the making of the complaint on 17 February 2020, the house was rented to a tenant at times, remedial work was conducted under the Statutory Insurance Scheme, and it would be expected that regular maintenance was conducted as well.
  3. [98]
    It is significant that the premises were rented. No evidence was provided as to a certificate as to fitness for occupancy for rental being issued at any time. It is difficult to comprehend that a house that was not at practical completion would be rented on a commercial basis, without some specific arrangement noting for the state of the house as not being practically complete being in place.
  4. [99]
    It is difficult to assess the state of completion of the house that is attributable to the building contract in light of the works that were conducted on it subsequently.
  5. [100]
    Having regard to that history of occupancy, and the work done on the house, the submission by the owner that practical completion has not been achieved at all as at the date of the hearing is unrealistic, and I do not accept that submission.
  6. [101]
    The question then arises as to which date is to be adopted for the purposes of calculating the start of the limitation period provided in section 72A(4) of the QBCC Act as ‘the date when ‘the building work to which the direction relates was completed or left in an incomplete state’ – should that date be: the date of handover on 29 March 2013; or the date of occupation on 4 July 2014; or the date when the works were repaired under a Direction to Rectify in 2017?
  7. [102]
    I apply the decision of Justice Flanagan in Barry & Anor v Queensland Building and Construction Commission[42] where he considered a similar provision as to a limitation period in the former Section 72(8) of the QBCC Act. His Honour found that the expression ‘the building work to which the direction relates’ is to be read within its defined meaning in the QBCC Act as follows:[43]

… The words ‘the building work to which the direction relates ‘does not indicate that ‘building work’ is to have other than its defined meaning. Defined meaning of ‘building work’ includes not just the physical construction of the deck but also arranging for a certificate to be issued.

  1. [103]
    His Honour said that the ordinary meaning of the word ‘completed’ involves an element of finality and an identifiable endpoint from which the time limit begins,[44] and involve considering ‘when the building work as a whole was completed.’[45]
  2. [104]
    When this matter is looked at in light of the interpretation of the QBCC Act as found by Justice Flanagan in Barry, the issuing of the final inspection certificate on or about 1 August 2014 emerges as the appropriate date from which the limitation period should commence.
  3. [105]
    I accordingly accept the submission of the QBCC that the building works were completed on the issuing of the final inspection certificate on or about 1 August 2014, and that a Direction to Rectify would have to have been given by 1 February 2021.[46]
  4. [106]
    The complaint made on 17 February 2020 was therefore made within the limitation period under s 72A(4) of the QBCC Act and Clause 3(2) of the Rectification Policy.

Conclusion

  1. [107]
    The Internal Review decision made on 31 July 2020 must be set aside, as it did not consider a reviewable decision.
  2. [108]
    I find that:
    1. The complaint made on 17 February 2020 was made within the Limitation Period under s 72A(4) of the Act and Clause 3(2) of the Rectification Policy; and that
    2. Complaints and Requests for a Direction to Rectify were made within the Notice Period under s 71J(4) of the Act and Clause 3(1) of the Rectification Policy for a Direction to Rectify to be given.
  3. [109]
    The usual process, that the matter would have been referred to the insurance section of the QBCC for consideration under the Queensland Home Warranty Scheme as outlined by the QBCC in the Notice given to the Director on 5 June 2020, can proceed.
  4. [110]
    The issue as to whether it would be fair for the QBCC to seek repayment of any insurance payment from Mr Brewster is one to be determined if, and when, a decision was made by the QBCC to seek repayment from him after the usual insurance procedures were completed.
  5. [111]
    As the initial underlying issue is as to whether the complaint was made within time, I will make a Declaration that the complaints and requests were made within time, which will be available for the further consideration of the insurance claim if required, as follows:

It is declared that complaints and requests for rectification of building work or remediation of consequential damage were made as to Items 1, 2 and 3 listed in the Resolution Services Initial Inspection Report dated 22 May 2020 to the Queensland Building and Construction Commission by TCQ Pty Ltd as trustee for the Midgley Family Trust within time pursuant to sections 72A(4) and 71J(4) of the Queensland Building and Construction Commission Act 1991 (Qld) and Clauses 3(1) and 3(2) of the Rectification Policy of the Queensland Building and Construction Commission.

Footnotes

[1]  QBCC submissions filed 26 May 2023, [8](c) and [8](e).

[2]  Letter from Cohen Legal to Internal Review Unit, Queensland Building and Construction Commission, 3 July 2020.

[3]  Internal Review Decision Notice, 31 July 2020, p 1.

[4]  [1990] HCA 33, 32.

[5]  [2020] QSC 24, [25].

[6]  [2022] QCAT 72, [53].

[7] Queensland Civil and Administrative Tribunal Act 2009 (Qld) s 3(b).

[8]  Applicant closing submission, filed 12 May 2023, [2].

[9]  Ibid [4].

[10]  Ibid [10].

[11]  Ibid [12].

[12]  Ibid [14].

[13]  Ibid [15].

[14]  Ibid [16].

[15]  Closing submissions of Mr Brewster, filed 26 May 2023 [1].

[16]  Ibid [7].

[17]  Ibid [10].

[18]  Ibid [13], [14].

[19]  Submissions of the QBCC filed on 26 May 2023, [7]

[20]  Ibid [10]

[21]  Ibid [21].

[22]  Ibid [22]-[24].

[23]  Ibid [25].

[24]  Ibid [34].

[25]  Ibid [35].

[26]  [2019] QCAT 408.

[27]  Ibid [28].

[28]  Ibid [28].

[29]  Submissions of the QBCC filed on 26 May 2023, [37].

[30]  Ibid [40].

[31]  [2021] QCAT 32.

[32]  Submissions of the QBCC filed on 26 May 2023, [43].

[33]  [2015] QSC 50, [26].

[34]  Resolution Services initial inspection report, 5 May 2020, p 3.

[35]  Ibid, p 3

[36]  Statement of Mr Midgley filed 17 March 2022 (Exh 2). [1.3]

[37]  Resolution Services Initial Inspection Report, 5 May 2020, p 3

[38]  Ibid p 10.

[39]  Statement of Mr Midgley filed 17 March 2022 (Exh 2). [1.4] 

[40]  Ibid [1.5]

[41]  Requested statement of further evidence of Matthew James Brewster, filed 8 November 2021, (Exhibit 4).

[42]  [2015] QSC 50

[43]  Ibid [24].

[44]  Ibid [26].

[45]  Ibid.

[46]  QBCC submissions filed 26 May 2023, [50-51]

Close

Editorial Notes

  • Published Case Name:

    TCQ Pty Ltd ATF Midgley Family Trust v Queensland Building and Construction Commission & Anor

  • Shortened Case Name:

    TCQ Pty Ltd ATF Midgley Family Trust v Queensland Building and Construction Commission

  • MNC:

    [2023] QCAT 485

  • Court:

    QCAT

  • Judge(s):

    Member Paratz AM

  • Date:

    13 Dec 2023

Appeal Status

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

Cases Cited

Case NameFull CitationFrequency
ACN148 877 525 Pty Ltd v Queensland Building and Construction Commission [2022] QCAT 72
2 citations
Jump To
Cite 1 - [2022] QCAT 72
Cite 2 - [2022] QCAT 72
Australian Broadcasting Tribunal v Bond (1990) HCA 33
2 citations
Jump To
Cite 1 - (1990) HCA 33
Cite 2 - (1990) HCA 33
Barry v Queensland Building and Construction Commission [2015] QSC 50
3 citations
Jump To
Cite 1 - [2015] QSC 50
Cite 2 - [2015] QSC 50
Cite 3 - [2015] QSC 50
Crocker v Queensland Building and Construction Commission [2020] QSC 24
2 citations
Jump To
Cite 1 - [2020] QSC 24
Cite 2 - [2020] QSC 24
MacFarlane v Queensland Building and Construction Commission [2019] QCAT 408
1 citation
Jump To
Cite 1 - [2019] QCAT 408
Walker v Queensland Building and Construction Commission [2021] QCAT 32
2 citations
Jump To
Cite 1 - [2021] QCAT 32
Cite 2 - [2021] QCAT 32

Cases Citing

No judgments on Queensland Judgments cite this judgment.

1

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