Mattke v Al-Monsour[2024] QCAT 181

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

REASONS FOR DECISION

Introduction

1. [1]
   By an application for domestic building dispute filed on 12 October 2022 (‘the Application’), the Applicant sought restitution from the Respondent of the amount of $4,380.00 together with the costs of $367.00 as a result of work performed by the Respondent at the Applicant’s property in Brisbane in the State of Queensland (‘the Property’). The work involved the building of a deck (‘the Deck’) around a pool in the backyard of the Property.
2. [2]
   Pursuant to directions of the Tribunal made on 7 March 2023, the Applicant filed an affidavit of service on 15 March 2023, attesting to service of the Application (including all exhibits) on the Respondent.
3. [3]
   The Tribunal issued a number of directions which required, amongst other matters, the Respondent to file a response to the Application. The Respondent did not do so.
4. [4]
   On 27 June 2023, the Tribunal made Directions which required the filing by the Applicant of a statement addressing various matters. The Applicant complied with that direction.
5. [5]
   On 5 September 2023, the Tribunal made further directions, first, that the Applicant must file a further statement of evidence addressing specified matters and, second, that the Application would be determined on the papers without an oral hearing on the basis of the documents forming the Tribunal record, regardless of whether the Applicant complied with the first direction. The Applicant complied with the first direction.
6. [6]
   In determining the Application, it is necessary to give consideration to the issue of jurisdiction.

Jurisdiction

7. [7]
   Subsection 77(1) of Queensland Building and Construction Commission Act 1991 (Qld) (‘the QBCC Act’) provides that a person involved in a building dispute may apply, as provided under ‘the QCAT Act’ (the Queensland Civil and Administrative Tribunal Act 2009 (Qld)), to the Tribunal to have the Tribunal decide the dispute.
8. [8]
   The definition of ‘building dispute’ in Schedule 2 to the QBCC Act includes ‘a domestic building dispute’.
9. [9]
   At the time of the filing of the Application, Schedule 2 to the QBCC Act provided, relevantly, the following definitions:

   1. ‘building dispute’ means, relevantly, a domestic building dispute;
   2. ‘domestic building dispute’ means, relevantly, a claim or dispute arising between a building owner and a building contractor relating to the performance of reviewable domestic work or a contract for the performance of reviewable domestic work;
   3. ‘reviewable domestic work’ means domestic building work under schedule 1B, section 4, except that for applying schedule 1B, section 4(8), the definition excluded building work under this schedule is taken not to mean anything mentioned in paragraph (b), (c) or (d) of that definition.
10. [10]
    I find that:

    1. the work the subject of the contract set out in paragraph 24 below was ‘associated work’, being work associated with the renovation, alteration, extension, improvement or repair of a home (see Schedule 1B, s 4(3)(b) and s 4(4)(c)), and such work is ‘domestic building work’;
    2. the Work was not ‘excluded building work’ (see Schedule 1B, s 4(8)), noting, in particular, that the work was of a value greater than $3,300.00;
    3. by reason of subparagraphs (a) and (b) above, the work was ‘reviewable domestic work’;
    4. the Applicant was a ‘building owner’ being a person for whom domestic building work has been carried out (see Schedule 1B, s 1, definition of ‘building owner’);
    5. the Respondent was a ‘building contractor’ being a person who has carried out domestic building work (see Schedule 1B, s 1, definition of ‘building contractor’);
    6. the dispute is a dispute arising between a building owner and a building contractor relating to the performance of reviewable domestic work and comprises a ‘domestic building dispute’;
    7. by reason of subparagraphs (a) to (f) above, the dispute the subject of the Application is a ‘building dispute’ for the purposes of s 77(1) of the QBCC Act.
11. [11]
    However, a person may not apply to the Tribunal unless the person has complied with a process established by ‘the commission’ (the Queensland Building and Construction Commission (‘QBCC’)) to attempt to resolve the dispute (see s 77(2) of the QBCC Act).
12. [12]
    The Applicant filed correspondence from the QBCC dated 11 August 2022 (exhibit L to the Application). That correspondence stated, amongst other matters, that the Applicant had now ‘reached the end of our dispute process’; that the case had been finalised because both parties had been unable to reach an agreement; and that the QBCC had no power to assist any further in the dispute about the building contract. Having regard to this correspondence, I am satisfied that s 77(2) of the QBCC Act does not preclude the Tribunal from determining the Application.^[1] I find that the Tribunal has jurisdiction to hear and determine the Application.
13. [13]
    I now turn to the merits of the Applicant’s claim.

Basis of the Applicant’s claim

14. [14]
    Although the Applicant sought the sum of $4,380.00 by way of restitution in the Application, in his submissions filed on 24 July 2023, the Applicant sought orders that the Respondent:

    1. ‘return’ to the Applicant $3,500.00 (plus ‘the usual court-calculated interest’ (interest));
    2. pay $880.00 to the Applicant (plus interest);
    3. pay $367.00 to the Applicant being the amount of the ‘application fee’.
15. [15]
    Before dealing with those claims, I will address the contract between the Applicant and the Respondent.

The contract

16. [16]
    There was no formal contract document signed by the parties. Rather, based on the evidence of the Applicant, I find that the contract comprised a written quotation entitled “Invoice” dated 29 May 2022 (‘the quote’), plans, three text messages between the Applicant and the Respondent, and a telephone conversation between the Applicant and the Respondent.
17. [17]
    The quote provided that the Respondent would perform the ‘Framing’ for the Deck (both supplying labour and materials) and that he would also carry out the ‘Merbau decking’ (supplying labour and materials save for the Merbau decking boards which were to be supplied by the Applicant).
18. [18]
    On 30 May 2022, the Applicant emailed the Respondent five pages of plans, the first being a formal plan entitled ‘Maxi Connection Details’ prepared by an engineering company, with a further four pages of handwritten plans showing the details for the proposed Deck.
19. [19]
    By a text message sent by the Respondent to the Applicant on 11 June 2022, the Respondent stated:

Hi Adrian, plans received, updated quote sent. I have allowed for hardwood framing around the pool as mentioned in plans (F7), all joist meeting poor [sic] edge to be notched and FC sheeting installed as per plan. I have allowed for all materials expect [sic] the decking boards. Thanks.

20. [20]
    The Applicant responded by text:

‘Prefect. [sic] Happy to transfer 30(?) % to you now?’

21. [21]
    The Respondent responded by text, stating ‘Okay sounds good, I will see you 8am Monday.’ The Respondent provided his bank details in the text.
22. [22]
    The Respondent sent the Applicant an updated quote on 10 June 2022 which was for a different customer and the Applicant confirmed receipt of the updated quote without having seen that the quote was not for the Applicant’s project.^[2]
23. [23]
    In a subsequent telephone conversation on 11 June 2022, the Applicant advised the Respondent that he (the Respondent) had sent the wrong quote; the Respondent accepted that he had sent the wrong quote; and the Respondent confirmed that, first, the timber for the project would be ‘H4 timber’ and, second, the total price for the project had not changed.^[3]
24. [24]
    In my view, there was a concluded contract between the parties that the Respondent agreed to perform the work set out in the quote in accordance with the plans, save as modified by the content of the text set out in paragraph [19] above and that the timber would be ‘H4’ timber (as per the telephone conversation set out in paragraph [23] above) (collectively ‘the Work’), for a price of $10,200.00 plus GST.
25. [25]
    I accept the Applicant’s evidence (which is documented) that he paid the sum of $3,500.00 to the Respondent on 11 June 2022.^[4]

Claim for return of moneys paid

26. [26]
    The Applicant claims a return of the amount of $3,500.00 on the basis that the Respondent was unlicensed under the QBCC Act.
27. [27]
    Section 42 of the QBCC Act provides (and provided at the date of the contract):

1. Unless exempt under schedule 1A, a person must not carry out, or undertake to carry out, building work unless the person holds a contractor’s licence of the appropriate class under this Act. Maximum penalty—

1. for a first offence—250 penalty units; or

2. for a second offence—300 penalty units; or

3. for a third or later offence, or if the building work carried out is tier 1 defective work—350 penalty units or 1 year’s imprisonment.

2. An individual who contravenes subsection (1) and is liable to a maximum penalty of 350 penalty units or 1 year’s imprisonment, commits a crime.
3. Subject to subsection (4), a person who carries out building work in contravention of this section is not entitled to any monetary or other consideration for doing so.
4. A person is not stopped under subsection (3) from claiming reasonable remuneration for carrying out building work, but only if the amount claimed—

1. is not more than the amount paid by the person in supplying materials and labour for carrying out the building work; and

2. does not include allowance for any of the following—

1. the supply of the person’s own labour;

2. the making of a profit by the person for carrying out the building work;

3. costs incurred by the person in supplying materials and labour if, in the circumstances, the costs were not reasonably incurred; and

3. is not more than any amount agreed to, or purportedly agreed to, as the price for carrying out the building work; and

4. does not include any amount paid by the person that may fairly be characterised as being, in substance, an amount paid for the person’s own direct or indirect benefit.

28. [28]
    I accept the Applicant’s evidence (supported by a copy of a licence search of the QBCC) that the Respondent did not hold a licence issued by the QBCC until 17 August 2022.^[5] This is against the background that the contract between the parties was entered into on 11 June 2022, that the Respondent commenced work on 13 June 2022,^[6] and that the Respondent left site on 17 June 2022, having collected all of his tools.^[7] The Respondent did not advise the Applicant that he did not have a QBCC licence that would have allowed him to perform the Work.^[8]
29. [29]
    The consequence of a building contractor performing unlicensed building work has been analysed by Senior Member Brown in Yongwoo Park v Betaland Pty Ltd.^[9] I respectfully adopt the following conclusions (adapting some of the language):

    1. by s 42(3) of the QBCC Act, a person who carries out building work without holding an appropriate class of licence (the unlicensed contractor) is not entitled to any monetary or other consideration for doing so;
    2. however, the unlicensed person may claim reasonable remuneration for carrying out building work as prescribed by s 42(4) of the QBCC Act and the onus is upon that person to prove such a claim;
    3. the entitlement of a homeowner to recover moneys paid to the unlicensed person is the reciprocal of that person’s disentitlement to receive the payment.
30. [30]
    I find that:

    1. being unlicensed, the Respondent was not entitled to receipt of the payment of $3,500.00 made to him by the Applicant;
    2. the Respondent has not made any claim for reasonable remuneration pursuant to s 42(4) of the QBCC Act;
    3. the Applicant is entitled to recover the amount of $3,500.00, which may be ordered pursuant to s 77(3)(d) or, alternatively, s 77(3)(a) of the QBCC Act.

The claimed cost of removal of materials

31. [31]
    In the Applicant’s July 2023 submissions, the Applicant claimed costs in the sum of $880.00 on the basis that the work carried out by the Respondent was defective (as documented in the report of Kevin Talbot of Talbot Constructions dated 22 June 2022 (‘the Report’))^[10] and that the Applicant had to remove the ‘defective structure’ and discard the materials. In my view, this aspect of the claim is properly treated as a claim in the nature of damages.
32. [32]
    The principle to be applied in assessing damages for breach of contract is as follows:^[11]

The ruling principle in assessing damages for breach of contract is, as stated in Robinson v Harman, that the claimant is entitled to recover the amount necessary to place him or her in the same position as if the contract had been performed. Where there is defective building work the prima facie measure of damages is the cost of rectifying the defective work to conform with the terms of the contract. This is the rule in Bellgrove v Eldridge. A party suing for damages for breach of a contract may only recover for the net loss sustained, that is, the value of the benefit of the contract fully performed less the contract price for securing such performance. (emphasis added)

33. [33]
    In Bellgrove v Eldridge, the High Court said:^[12]

In none of these cases is anything more done than that work which is required to achieve conformity and the cost of the work, whether it be necessary to replace only a small part, or a substantial part, or, indeed, the whole of the building is, subject to the qualification which we have already mentioned and to which we shall refer, together with any appropriate consequential damages, the extent of the building owner's loss.

The qualification, however, to which this rule is subject is that, not only must the work undertaken be necessary to produce conformity, but that also, it must be a reasonable course to adopt.

…

As to what remedial work is both 'necessary' and 'reasonable' in any particular case is a question of fact ...

34. [34]
    The Report sets out what are said to be ‘multiple deficiencies’ with the construction of the Deck and then provides the following summary:

In summary most of the joists need to be replaced, the footings need to be re-done, the stirrups need to be replaced, extra bearers need to be installed, the joists need to be levelled. Most of the current materials need to be disposed of.

35. [35]
    The Applicant has provided a Tax Invoice from JGR Joinery dated 22 September 2022 in the amount of $880.00 (including GST) for what is described as “Deck removal, footing removal and disposal of timber, fixings and concrete”.
36. [36]
    In my view, there are two difficulties with the formulation of this aspect of the Applicant’s claim.
37. [37]
    First, the Applicant has not proceeded on the basis set out in paragraph [32] above, but has, in effect, sought to put himself in the position he would have been in had the contract not been entered into at all (that is, return of the deposit paid (as restitution) and removal of the incomplete structure erected at the Property).
38. [38]
    Second, in the Report, Mr Talbot expressed the view that most of the current materials needed to be disposed of. On the face of the tax invoice, it appears that all materials provided by the Respondent were removed. Consequently, the claim includes the cost of removing an unidentified quantity of materials when, on the evidence, it was not necessary to do so. The evidence does not permit of identification of the cost of only those materials that needed to be removed.
39. [39]
    On the material as presented by the Applicant, I find that the Applicant has not established an entitlement to the claimed cost of removal of the materials.

Interest

40. [40]
    The question of interest that may be awarded in a building dispute has been addressed by the Appeal Tribunal in Worthington v Ryan; Ryan v Worthington.^[13] In summary (ignoring default decisions):

    1. interest on an award of damages (see s 77(3)(c) of the QBCC Act) is payable on and from the day after the day that the amount becomes payable, and an amount becomes ‘payable’ only when there was an amount which had been fixed by an assessment of damages (when the decision of the Tribunal is issued);
    2. in making an order for the payment of an amount found to be owing by one party to another pursuant to s 77(3)(a) of the QBCC Act, the Tribunal may include the payment of an amount of interest prescribed under a contract.
41. [41]
    Further, s 77(3)(d) of the QBCC Act, which provides that the Tribunal may order restitution, makes no provision for the awarding of interest on such sum (in contrast to s 77(3)(c) in the making of an award of damages).
42. [42]
    In circumstances where the contract between the parties did not provide for an award of interest, I am of the view that the Applicant is not entitled to any interest on the amount ordered to be paid to him for any period up to the date of this decision.

Costs

43. [43]
    Pursuant to s 77(3)(h) of the QBCC Act, the Tribunal has power to award costs in a building dispute. In circumstances where the Applicant has had substantial success in the proceeding, I consider it appropriate that he be compensated by an award of costs in the amount of $367.00, being the amount of the filing fee for the Application.

Orders

44. [44]
    For the reasons set out above, I order that the Respondent must pay to the Applicant the amount of $3,867.00 within twenty-eight (28) days of the date of this decision.