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Munro v Camdun Pty Ltd t/as Asset Carpentry & Building Supplies[2024] QCAT 452

Munro v Camdun Pty Ltd t/as Asset Carpentry & Building Supplies[2024] QCAT 452

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:

Munro v Camdun Pty Ltd t/as Asset Carpentry & Building Supplies [2024] QCAT 452

PARTIES:

janeece munro

(applicant)

v

camdun pty ltd t/as asset carpentry & Building supplies

(respondent)

APPLICATION NO/S:

BDL205-21

MATTER TYPE:

Building matters

DELIVERED ON:

18 October 2024

HEARING DATE:

31 July 2024

HEARD AT:

Brisbane

DECISION OF:

Member Howe

ORDERS:

  1. It is declared that clause 4.2 of the contract between the parties is void and of no effect.
  2. Janeece Munro must pay to  Camdun Pty Ltd t/as Asset Carpentry & Building Supplies the sum of $551.84 within 14 days of this order.
  3. Unless a party files in the Tribunal a Form 40 Application for Miscellaneous Matters within 14 days seeking a contrary order, each party shall bear their own costs.

CATCHWORDS:

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – THE CONTRACT – CONSTRUCTION OF PARTICULAR CONTRACTS AND IMPLIED CONDITIONS – OTHER MATTERS – where the parties entered into a renovation contract – where the contract appeared to be one for fixed price – where the contract permitted the builder to unilaterally vary the price of the contract and scope of work as a variation – where no formula for change of price discernible – where the contract breached the statutory requirements of s 14 of Schedule 1B of the Queensland Building and Construction Commission Act 1991 (Qld) and s 40 and s 41 of Schedule 1B in a number of respects – whether the breaches were void pursuant to s 108D of the Act or s 44 of Schedule 1B applied and the breaches did not make the contract illegal, void or unenforceable – where the builder purported to reduce the scope of work under the contract as a variation – whether the builder was entitled to claim for payment for work done under the reduced scope of work – whether the builder was entitled to claim payment for variations not complying with the statutory requirements

Queensland Building and Construction Commission Act 1991 (Qld), s 3(d), s 108D, Schedule 1B s 13, s 14, s 29(4), s 40, s 41, s 44

Allaro Homes Cairns Pty Ltd v O'Reilly & Anor [2012] QCA 286

Boys v Imperial Homes (Qld) Pty Ltd  [2024] QCATA 35

Caltex Oil (Aust) Pty Ltd v Best (1990) CLR 516

Cellarit Pty Ltd v Cawarrah Holdings Pty Ltd [2018] NSWCA 213

Cochrane v Lees [2021] QCATA 74

French v NPM Group Pty Ltd [2008] QSC 48

Harvey v Minister for Primary Industry and Resources [2024] HCA 1

Heyman v Darwins Ltd [1942] AC 356

Mann v Peterson Constructions Pty Ltd (2019) 267 CLR 560

Moratic Pty Ltd v Lawrence James Gordon & Anor [2007] NSWSC 5

Perera v Bold Properties (Qld) Pty Ltd [2023] QDC 99

Plaintiff S297/2013 v Minister for Immigration and Border Protection [2014] HCA 24; (2014) 255 CLR 179

Tan Hung Nguyen v Luxury Design Homes Pty Ltd [2004] NSWCA 178

Thallon Mole Group Pty Ltd v Morton [2022] QDC 224

Venamore T/as Kobble Gardens v Reynolds [2003] QCCTB 71

APPEARANCES & REPRESENTATION:

Applicant:

Self-represented

Respondent:

Self-represented by A Cameron and K Dunbar

REASONS FOR DECISION

  1. [1]
    Ms Munro entered into a domestic building contract with the respondent builder to renovate her existing home on 14 August 2020. The price noted on the second page of the schedule to the contract was $188,996.85.
  2. [2]
    The general conditions were not in the usual terms to be found in Queensland standard residential building contracts. Attached to the schedule to the contract was a document entitled Cost Schedule, more commonly referred to as specifications, an attachment entitled Job Specifications (a list of prime cost and provisional sum items) and an attachment entitled Progress Payments.
  3. [3]
    Ms Munro had already commissioned plans for the project and those plans were adopted by the builder.
  4. [4]
    The building work started in October 2020. There was no start date or date for practical completion stated in the contract.[1]
  5. [5]
    There was provision made for seven progress payments. Ms Munro paid the stage 5 progress payment in May 2021 when the parties fell out, the builder claiming Ms Munro was interfering and Ms Munro maintaining the builder’s workers were not applying a particular sealing membrane product called Pro Clima correctly.
  6. [6]
    The builder left the site on about 8 June 2021.
  7. [7]
    On 11 June 2021 the builder issued a sixth progress claim for the practical completion stage (there was provision for a seventh final progress claim) in the full amount of $28,349.53.
  8. [8]
    The practical completion claim was not paid and the builder sent a reminder about the money being overdue on 29 June 2021. Ms Munro replied that she was waiting for payment of a government grant to pay the invoice.
  9. [9]
    The builder then advised there were additional charges for variations.
  10. [10]
    Ms Munro refused to pay more. She said practical completion had not been reached and some of the work done was defective. She said the contract was for a fixed price.
  11. [11]
    The builder responded on 1 August 2021 saying that the contract was not fixed price.
  12. [12]
    On 5 August 2021 the builder forwarded details of variations which, after allowing numerous credits for work not done, totalled $8,053.82. Ms Munro denied the builder could claim for variations given she had not agreed to them and they were not in writing signed by her.
  13. [13]
    In an email dated 11 August 2021 Ms Munro required the builder to attend at the premises, examine what work was still incomplete work and damaged and defective work and to remedy it by 25 August 2024. By return email dated 12 August 2021 the builder said that date was not agreed, a suitable date would have to be agreed but the builder maintained its claim for variations.
  14. [14]
    The following day, 13 August 2021, Ms Munro filed the within application for building dispute in the Tribunal.

Parties’ material

  1. [15]
    Neither party filed a comprehensive chronological statement of evidence telling their story in sensible detail. Instead they filed copies of numerous emails and spreadsheets absent explanation other than in broad brush fashion and responded to the other party’s comments.
  2. [16]
    Doing the best I can the parties’ claims are as follows.

Applicant’s claim

  1. [17]
    At hearing Ms Munro said she claimed:

Relief from payment of the practical completion stage claim of $28,349.53;

Relief from payment for variations in the amount of $31,066.

Recovery of $16,914.15 representing items she paid for that should have been paid by the builder; and

The costs of rectification of defects and incomplete work in an amount of $3,030.80.

  1. [18]
    In other material filed by her however she had also claimed $10,000 damages for damage to windows and $100,000 damages for failure to deliver “the renovation aim” of a passively designed home. She also claimed $2,629.10 described as “additional claims”.

Builder’s counter application

  1. [19]
    The builder’s claims are as set out below. It is difficult to follow and makes little sense save if one understands that the scope of work set for the practical completion stage has purported to be reduced and the value of the work not done given as a variation credit:

Monies due “to” practical completion $18,899.69

Variations added to the contract $31,066.00

Less variations removed from

the contract $21,557.88

Less prime costs and provisional

sum adjustments to the contract $  3,980.00

$  5,528.12 $  5,528.12

Total $24,427.81

The contract

  1. [20]
    In an email from Ms Munro to the builder dated 28 July 2021 she comments that the contract had appeared to be a fixed price building contract. The builder responded by email dated 1 August 2021 that the contract was not fixed price; the builder said it never did fixed price contracts in renovations because there were too many unknowns.
  2. [21]
    There is very little information on the first page of the schedule to the contract, simply Ms Munro’s name and address and the name of the builder and the words “Works Agreement” in bold, and then under that the words “valid for 30 days”.
  3. [22]
    On the second page an amount of $188,996.85 is noted in a prominent position with the price (and a GST component) appearing in large bold font and then after that the words:

Acceptance signatory

The combined signing of this document constitutes an agreement between both parties which includes all documentation, terms and prices mentioned herein.

Below that appears the signatures of Ms Munro and Mr Cameron for the builder and the date of execution 14 August 2020.

  1. [23]
    There is nothing more in the schedule.
  2. [24]
    After the schedule appears general conditions which are described as “Business Terms and Conditions”.
  3. [25]
    The general conditions are strange. They are not recognizable as any type of standard construction contract conditions. They appear, rather, to be terms and conditions more commonly associated with the supply of goods and services to a consumer under consumer legislation, such as the Australian Consumer Law. There is no reference to the Australian Consumer Law in them, but there is reference to the Commonwealth Trade Practices Act 1974 and “Fair Trading Acts”. The Trade Practices Act 1974 was repealed in 2011 and was of course predecessor to the Australian Consumer Law.
  4. [26]
    Clause 1 of the general conditions is a definitions clause defining only contractor, client, guarantor, goods, services and price.
  5. [27]
    The reference to “goods” occurs throughout the document and is defined to mean goods supplied by the contractor to the client and where the context permits includes the supply of services as defined.
  6. [28]
    Services is defined to mean services supplied by the contractor to the client and includes any advice or recommendations and where the context permits includes the supply of goods as defined.
  7. [29]
    Price is defined to mean the price payable for the goods as agreed between the contractor and the client in accordance with clause 4 of the contract.
  8. [30]
    Clause 4 provides:
  1. 4.1
    At the contractor’s sole discretion the price shall be either:
  1. as indicated on invoices provided by the contractor to the client in respect of goods supplied; or
  1. the contractor’s quoted price (subject to clause 4.2) which shall be binding upon the contractor provided that the client shall accept the contractor’s quotation in writing within 30 days.
  1. [31]
    Clause 4.2 deserves particular attention. It is addressed in detail below in these reasons. It states:
  1. 4.2:
    The contractor reserves the right to change the price in the event of a variation to the contractor’s quotation. Any variation from the plan of scheduled works or specifications (including, but not limited to, any variation due to unforeseen circumstances, or as a result of increases to the contractor in the cost of materials and labour) will be charged for on the basis of the contractor’s quotation and will be shown as variations on the invoice. Payment for all variations must be made in full at the time of completion.
  1. [32]
    Then clause 4 continues:
  1. 4.3:
    The contractor may submit a detailed payment claim at intervals not less than one week for work performed up to the end of each week. The value of work so performed shall include the reasonable value of authorized variations and the value of materials delivered to the site but not yet installed.
  1. 4.4:
    At the contractor’s sole discretion a non-refundable deposit may be required.
  1. 4.5:
    At the contractor’s sole discretion:
  1. payment shall be due on delivery of the goods; or
  1. payment shall be due before delivery of the goods; or
  1. payment for approved clients should be made by instalments in accordance with the contractors payment schedule.
  1. [33]
    Clause 5 deals with delivery of goods and is clearly directed to circumstances of physical delivery of chattels.
  2. [34]
    Similarly, Clause 10 which addresses defects in “goods”, provides:
  1. 10.1
    The client shall inspect the goods on delivery and shall within 5 days of delivery (time being of the essence) notify the contractor of any alleged defect, shortage in quantity, damage or failure to comply with the description or quote. The client shall afford the contractor an opportunity to inspect the goods within a reasonable time following delivery if the client believes the goods are defective in any way. If the client shall fail to comply with these provisions the goods shall be presumed to be free from any defect or damage. For defective goods, which the contractor has agreed in writing that the client is entitled to reject, the contractors liability is limited to either (at the contractor’s discretion) replacing the goods or repairing the cords except where the client has acquired goods as a consumer within the meaning of the Trade Practices Act 1974 or the Fair Trading Acts of the relevant state or territory is of Australia, and is therefore also entitled to, at the consumers discretion either a refund of the purchase price of the goods, or repair of the goods, or replacement of the goods.
  1. 10.2
    Goods will not be accepted for return other than in accordance with 10.1 above.
  1. [35]
    Clause 11 limits warranties generally to 12 months from the date of delivery of goods.[2]
  2. [36]
    Then at clause 19, headed General, it is provided:

The client agrees that the contractor may review these terms and conditions at any time. If, following any such review, there is to be any change to these terms and conditions, then that change will take effect from the date on which the contractor notifies the client of such change.

  1. [37]
    After the general terms and conditions there is a document entitled “Cost schedule” of 12 pages, more commonly known as specifications, which lists all the materials and work to be included in the build with prices for the various items and hours of work to complete noted.
  2. [38]
    On page 12 the total price for the contract is again recorded as $188,996.85.
  3. [39]
    Next comes a two-page document described as Job Specifications listing prime and provisional cost items and then there is a 3 page document entitled Progress Payments. There are 7 stage payments noted:
    1. Deposit 5% $  9,449.84
    2. Base stage 20% $ 37,799.37
    3. Frame stage 20% $ 37,799.37
    4. Lockup Stage 20% $ 37,799.37
    5. Fit out stage 15% $ 28,349.53
    6. Practical Completion 15% $ 28,349.53
    7. Final Completion 5% $   9,449.84
    8. Contract Total 100% $188,996.85
  4. [40]
    Under the heading to the Practical Completion stage notation appears the following description of the stage:

The practical completion stage has been completed.

WORKS COMPLETED

All major works has (sic) been completed including painting and floor coverings.

FINAL COMPLETION/HANDOVER NOTIFICATION

Over the next 2 weeks we will be finalising all unfinished minor works and outstanding defects within the terms and conditions of the contract and verbally agreed.

Following the final completion invoice date, an industry standard defects period will apply of 6 months.

  1. [41]
    The seventh stage payment for Final Completion claims for 5% of the work and contract price. Its scope, purpose and utility is unclear but it is as follows:

The final completion stage of the project is now complete.

WORKS COMPLETED

all contracted works has now been completed and finalised.

We have received and attached for your perusal and records all required documentation including building certificates and manufacturers warranties.

  1. [42]
    Given the contract was signed by both Mr Cameron for the builder and Ms Munro on 14 August 2020, clause 4.1(b) of the conditions applied binding the builder to the quoted price.

Contract requirements

  1. [43]
    Ms Munro thought the price was fixed. The builder maintains it was not.
  2. [44]
    The Queensland Building and Construction Commission Act 1991 (Qld) (‘the Act’) Schedule 1B s 14 provides:

Requirements for contract—level 2 regulated contract

  1. This section applies to a level 2 regulated contract.

…

  1. If the contract price is fixed, it must be stated in a prominent position on the first page of the contract schedule.
  1. If the contract price is not fixed, the method for calculating it, including any allowances, must be stated in the contract schedule.
  1. If the contract price may be changed under a provision of the contract, the contract must also contain—
  1. a warning to that effect; and
  1. a brief explanation of the effect of the provision allowing change to the contract price.
  1. The warning and explanation mentioned in subsection (6) must be in a prominent position on the first page of the contract schedule.
  1. [45]
    Regardless as to whether the contract is fixed or not, clause 4.2 permits the builder, by variation, to change the contract price or the plan of scheduled works or the specifications. That might happen if there was an increase in the contractor’s cost of materials or labour. The owner need not agree. The changed works are charged “on the basis of the contractor’s quotation and will be shown as variations on the invoice.” That provides no sensible formula to the owner to enable the owner to calculate how the price will change.
  2. [46]
    Section 14(6) of Schedule 1B therefore required that a warning about the possibility of the price changing and a brief explanation of the effect of the provision allowing the price to be changed be set out in a prominent position on the first page of the contract schedule. There is no such warning.
  3. [47]
    In Perera v Bold Properties (Qld) Pty Ltd [2023] QDC 99 (‘Perera’) homeowners entered into a fixed sum construction contract. The start of work was delayed and before starting work the contractor advised that, due to increased costs of building materials amongst other things, the price was increased by more than $50,000. The homeowners did not agree with the price increase and the contractor would not start work.
  4. [48]
    The homeowners commenced legal proceedings seeking a declaration that the contract provision relied on by the contractor to justify increasing the price, special condition 7, was void.
  5. [49]
    In Perera special condition 7 permitted the contractor to increase the contract price “of the house type… to the builder’s current base price for that house type.” Barlow KC DCJ found the special condition void and the contractor not entitled to increase the contract price for a number of reasons including because there was no warning given that the special condition could increase the price in breach of s 14(3)(e), s 14(6) and s 14(7) of Schedule 1B of the Act. The learned Judge said:
  1. [50]
    There was no warning on the first page of the contract schedule concerning special condition 7, let alone an explanation of its effect.  Even if it were lawful to amend that warning by special condition 11 (which it is not), the warning in respect of special condition 7 is insufficient for the purposes of the QBCC Act:  again, it does not refer to that condition but to all the special conditions, and it does not explain the effect of the condition.
  1. [51]
    The warning, at least insofar as it concerns special condition 7, is therefore contrary to the QBCC Act and, under s 108D(2)(a), is void to the extent of that insufficiency. Does that mean that special condition 7 is itself void as being contrary to the Act? In my view, that is the effect of the invalidity of the warning insofar as it concerns that condition. The condition, if effective at common law, provides for a change to the contract price but no warning is given about the existence or effect of the condition. The effect of the legislation must be that the special condition itself is void, because otherwise the absence of a necessary warning and explanation would have no effect on the parties’ rights, but it would simply be an offence against the Act for the respondent to commence work before the contract complied with the requirement of schedule 1B, s 14.[26]
  1. [52]
    Therefore, special condition 7 is wholly void.  Under clause 38.7 of the contract, it is effectively severed from the contract and it does not invalidate any other provision of the contract.[27] Nor does the elimination of that condition change the kind of contract between the parties,[28] nor, in other words, affect the “heart of the transaction.”  The condition is not, in substance, so connected with the other terms of the contract that they form an indivisible whole which cannot be taken to pieces without altering its nature.[29]
  1. [50]
    Section 108D of the Act referred to states:

108D Contracting out prohibited

  1. A person can not contract out of the provisions of this Act.
  1. A domestic building contract is void to the extent to which it—
  1. is contrary to this Act; or
  1. purports to annul, exclude or change a provision of this Act.
  1. An agreement (other than a domestic building contract) is void to the extent to which it seeks to exclude, change or restrict a right conferred under this Act in relation to a domestic building contract.
  1. Nothing in this section prevents the parties to a domestic building contract from including provisions in the contract that impose greater or more onerous obligations on a building contractor than are imposed under this Act.
  1. Subsections (2) and (3) apply subject to any contrary intention in this Act.
  1. [51]
    In the matter at hand, the builder purported to vary the scope of work under the contract without consultation or agreement with Ms Munro. It excluded work from the practical completion stage and then sought payment of the value of reduced work done in that stage. The builder “varied” the contract apparently as provided by clause 4.2. Other than that there was no provision entitling it to do so.
  2. [52]
    The issue arises as to the validity of clause 4.2 given the failure of the builder to comply with the requirements of s 14(4) to (7) of Schedule 1B of the Act.
  3. [53]
    Unlike Perera however, in the matter at hand there is also an issue of undocumented variations to the contract to be determined, which makes stark the difficulty of establishing whether s 108D of the Act applies to render a provision which fails to comply with the Act void or whether s 44 of Schedule 1B holds sway whereby failures to comply with statutory requirements for domestic building contracts do not make a contract illegal, void or unenforceable.
  4. [54]
    Are variations which fail to comply with the requirements of ss 41 and 42 of Schedule 1B also to be held contrary to the Act and therefore void pursuant to s 108D?
  5. [55]
    Muir DCJ (as her Honour then was) thought that was the case in Thallon Mole Group Pty Ltd v Morton [2022] QDC 224 (‘Thallon Mole Group’), a decision referred to in Perera. The contractor in Thallon Mole Group argued that s 44 of Schedule 1B applied to save undocumented variations but that was rejected. The contractor claimed an estoppel arose following its reliance on oral instructions to vary the contract given by the owner’s agent, which was established as having occurred. The learned Judge said:
  1. [405]
    On a natural and ordinary reading of these provisions, I am satisfied that the admission of an estoppel would effectively exclude, change or restrict Mrs Morton’s statutory right to have a variation in writing and would therefore have the effect of nullifying the express statutory provisions contained in both s. 40 and s. 108D.[3]
  1. [56]
    However in Boys v Imperial Homes (Qld) Pty Ltd  [2024] QCATA 35 Judicial Member D J McGill SC said this about the current statutory scheme for variations:
  1. [49]
    … The Act does not provide that remuneration cannot be recovered for undocumented variations, and s 44 expressly provides that a failure to comply with the statutory provisions for documentation does not make the contract unenforceable.[32]
  1. [32]
    Prior to 1 July 2015, the Domestic Building Contracts Act 2000 (Qld) s 84 contained restrictions on recovery for undocumented variations, but that Act has since been repealed.
  1. [50]
    It is possible to formulate a contract in such terms that no amount will be payable for any additional work not otherwise encompassed by the contract unless it is documented in a particular way, but some care would be necessary in order to do this with sufficient clarity to prevent the ordinary consequence from following when someone asks a tradesman to do something, in circumstances where the natural implication is that it will be paid for. There is nothing in Clause 20 which would be effective to exclude that. It is always relevant to consider whether the alleged variation is not more than part of the work required under the contract anyway, but so long as that is not the case, there is nothing in the Clause, or in the Act, to the effect that the owner gets that work for free, as the builder is not entitled to charge for it.
  1. [57]
    Section 44 of Schedule 1B of the Act referred to provides:

44 Effect of failure by building contractor to comply with requirement

Unless the contrary intention appears in this Act, a failure by a building contractor to comply with a requirement under this Act in relation to a domestic building contract does not make the contract illegal, void or unenforceable.

  1. [58]
    Neither s 108D(2) to (5) nor s 44 are novel provisions. They had, as her Honour noted in Thallon Mole Group, had previous life as s 93 and s 92 of the Domestic Building Contracts Act 2000 (Qld) (‘DBC’). That Act was repealed by the Queensland Building and Construction Commission and other Legislation Amendment Act 2014 (Qld) and ss 93 and 92 were incorporated into the present legislation (the Act) as respectively s 108D and s 44.
  2. [59]
    The same difficulty in categorising circumstances where the former s 93 applied as opposed to s 92 arose from time to time under the DBC and the distinction was understood in the following terms set out by Member Lorisch in Venamore T/as Kobble Gardens v Reynolds [2003] QCCTB 71:

Section 93 of the Domestic Building Contract Act does not operate to render void and illegal a regulated contract which does not comply with the provisions of, for example, sections 27, 28 and 29. Section 93, as the Applicant submits, deals with attempts to contract out of, annul, exclude or change the provisions of the Act.

Section 92 limits the civil/contractual consequences of any failure to comply with the Domestic Building Contracts Act by a builder to those instances where the effect of non-compliance is specifically dealt with in those parts of the Act which lays down compliance criteria for particular purposes.

Accordingly the statutory result of non-compliance in respect of a regulated contract appears confined to section 30 of the Domestic Building Contracts Act.[4]

(emphasis added)

  1. [60]
    The former s 30 DBC referred to provided:

30 Contracts must be signed

A regulated contract has effect only if it is signed by the building contractor and building owner (or their authorised agents).

  1. [61]
    The equivalent provision is now to be found in Schedule 1B, s 13(2) with s 13(5) and Schedule 1B s 14(2) with 14(10), but with the additional requirement that the contract be in written form and dated.
  2. [62]
    The explanatory notes to the introduction of the DBC explained the intention of ss 92 and 93 in the following terms:

Clause 92 provides that only where a provision of this Act expressly provides that a contractual provision is void, illegal or unenforceable does a contractor’s non-compliance with a provision of this act have the effect of making that contractual provision void, illegal or unenforceable.

Clause 93 prohibits contracting out of any provision of this Act, other than to impose greater or more onerous conditions on the contractor.

(emphasis added)

  1. [63]
    Tracking the historical path taken by provisions can be helpful in the construction of legislation. In Plaintiff S297/2013 v Minister for Immigration and Border Protection [2014] HCA 24; (2014) 255 CLR 179; 309 ALR 209 (‘Plaintiff S297/2013’) Crennan, Bell, Gageler and Keane JJ stated:
  1. [25]
    … The numerous amendments that have been made to the Act form part of its legislative history and bear legitimately on its construction. They are to be construed as part of the Act, so as to be read together "as a combined statement of the will of the legislature".[5]
  1. [64]
    Plaintiff S297/2013 dealt with ongoing amendments to an Act and the transition of the DBC into Schedule 1B should also not be ignored. It forms part of the context spoken of when applying the “modern approach” to construction. The modern approach to statutory construction suggests context deserves far more weight than has traditionally been the case to permit a more perfect understanding of the intention of the legislature, and in accordance with that intention, deriving the correct interpretation of legislation. Edelman J recently explained this in Harvey v Minister for Primary Industry and Resources [2024] HCA 1:
  1. 111.
    The modern common law approach is not so constrained. The modern approach has now been approved and applied many times,[117] even if its spirit has not always been entirely respected. That modern approach was set out by Brennan CJ, Dawson, Toohey and Gummow JJ in CIC Insurance Ltd v Bankstown Football Club Ltd.[118] Referring to information in the reports of law reform bodies and speaking of context "in its widest sense", which includes the identification of external matters such as "the existing state of the law and the mischief which ... the statute was intended to remedy", their Honours said that context is "considered in the first instance, not merely at some later stage when ambiguity might be thought to arise". Their Honours clarified that context is not limited to information contained in extrinsic documents but also includes the application of reasonable expectations concerning any "inconvenience or improbability of result" that could arise on one interpretation of the statutory text which would then be inconsistent with "the legislative intent".[119] The modern approach thus generally aligns the techniques for interpretation of statutes with the techniques for interpretation of ordinary speech. Nevertheless, since the intention is that of a notional Parliament, and not any individual member or collection of members, even statements in second reading speeches or Explanatory Memoranda are only part of the context to be considered.[6]
  1. [65]
    When  the Queensland Building and Construction Commission and other Legislation Amendment Bill 2014 (Qld) was first introduced into Parliament, draft s 13(5) provided that a contract has effect only if it complied with s 13. The effect of failure to comply was not limited to a failure to comply with s 13(2) only. Any failure with respect to s 13(2), s 13(3) or s 13(4) rendered the contract of no effect.
  2. [66]
    Similarly s 14(11) originally as drafted provided that the contract had effect only if it complied with all of s 14, again not limiting the mandatory part to s 14(2) alone. Clearly the provisions were intended to have great weight. A breach of any of the provisions made the entire contract void and of no effect.
  3. [67]
    In the explanatory notes to the introduction of the Bill all the matters listed in s 13 and s 14 were described as the minimum requirements for the respective regulated contracts.
  4. [68]
    The range of circumstances that rendered a contract of no effect was reduced however at the third reading stage, with the Explanatory Notes to the amendments to the Bill stating:

It is proposed to amend proposed new sub-sections 13(5) and 14(11), QBCC Act, to provide that the contract has effect only if it complies with sections 13(2) and 14(2) from Schedule 1B, and to provide that contracts are not deemed invalid for failure to comply with all requirements of sections 13 and 14.

  1. [69]
    This followed receipt of the Transport, Housing and Local Government Committee Report No. 54 tabled in Parliament which recommended the amendment. The basis of the recommendation turned on inadvertent oversights on technicalities rendering a contract of no effect which had disproportional consequences.
  2. [70]
    The Minister said this at the second reading about the recommendation which led to the final (current) iteration of the provisions:

Recommendation 13 is to amend what constitutes an invalid contract. Currently, even a minor aspect of a contract that has been inadvertently omitted could make a contract null and void. The government agrees that the bill should be amended to provide that the contract has effect if it is written, dated and signed by both parties.[7]

  1. [71]
    The changes to the final provisions were therefore not based on a change of weight or significance attributed to the minimum requirements for regulated contracts by the legislature, but rather to avoid contracts being rendered ineffective through inadvertence.
  2. [72]
    The headings to both s 108D and s 44 have remained the same, unchanged before and after the 2014 amendments. Section 108D is entitled “Contracting out prohibited” and s 44 “Effect of failure by building contractor to comply with requirement”.
  3. [73]
    Section 108D has clear application to a clause such as clause 11 of the present contract, where the builder attempts to limit the statutory warranties to 12 months. That is clearly an attempt to contract out of the warranty provisions of Schedule 1B which provides by s 29(3) Schedule 1B a warranty period of six years. By s 108D that clause is made void.
  4. [74]
    It is far more difficult however to categorise the builder’s failure to comply with s 14(6) and s 14(7) of Schedule 1B as attempts to contract out of the provisions of the Act, rather than non-compliance with a provision of the Act, and why a failure to comply with the variation requirements of Schedule 1B might be regarded as contracting out[8] rather than failures to comply with the legislative requirements.
  5. [75]
    The High Court said in Caltex Oil (Aust) Pty Ltd v Best (1990) CLR 516:
  1. [5]
    … The most obvious and direct form of contracting out of a statute is the case in which a party covenants under seal or agrees for valuable consideration not to make a claim for a benefit for which the statute provides: see Lieberman v. Morris (1944) 69 CLR 69 (where a covenant not to make a claim under the Testator's Family Maintenance and Guardianship of Infants Act 1916 (N.S.W.) was held to be void or inoperative). But contracting out of a statute is not limited to cases in which a party simply foregoes or waives a benefit directly conferred upon the party by the statute. Contracting out may take many forms. They will vary with the nature, subject-matter and object or purpose of the statute, as well as the means selected with a view to escaping from its provisions or its operation.
  1. [6]
    An express statutory prohibition against contracting out renders void or inoperative contractual provisions which are inconsistent with the statute. Inconsistency between contract and statute is not confined to literal conflicts or collisions between the contractual provisions and the statutory provisions. Inconsistency in this context arises whenever there is a conflict between a contractual provision or the operation of such a provision and the purpose or policy of the statute. So, if the operation of a contractual provision defeats or circumvents the statutory purpose or policy, then the provision is inconsistent in the relevant sense and falls within the injunction against contracting out.[9]
  1. [76]
    Section 3(d) of the Act states an object of the legislation is to regulate domestic building contracts to achieve a reasonable balance between the interests of building contractors and building owners. I regard the statutory requirements of s 14 as clearly consumer provisions attempting to strike that balance.
  2. [77]
    Section 14 deals with the contents of the building contract, almost always a document prepared by the contractor, and more often that not signed by homeowners without the benefit of legal advice.
  3. [78]
    The means by which some balance is achieved seems clear: notice to the owner/consumer about whether the contract is for a fixed price or not fixed, if not fixed how the price will be calculated, what provisions may change the price and all that information on the first page of the contract schedule (which is the first page of the contract).
  4. [79]
    The statutory purpose of achieving balance between contractor and homeowner is easily compromised if not entirely circumvented where the contractor does not adhere to the statutory requirements set by s 14(4) to (7) Schedule 1B.
  5. [80]
    As stated by Barlow KC DCJ in Perera:
  1. [50]
    There was no warning on the first page of the contract schedule concerning special condition 7, let alone an explanation of its effect.  Even if it were lawful to amend that warning by special condition 11 (which it is not), the warning in respect of special condition 7 is insufficient for the purposes of the QBCC Act:  again, it does not refer to that condition but to all the special conditions, and it does not explain the effect of the condition.
  1. [51]
    The warning, at least insofar as it concerns special condition 7, is therefore contrary to the QBCC Act and, under s 108D(2)(a), is void to the extent of that insufficiency. Does that mean that special condition 7 is itself void as being contrary to the Act? In my view, that is the effect of the invalidity of the warning insofar as it concerns that condition. The condition, if effective at common law, provides for a change to the contract price but no warning is given about the existence or effect of the condition. The effect of the legislation must be that the special condition itself is void, because otherwise the absence of a necessary warning and explanation would have no effect on the parties’ rights, but it would simply be an offence against the Act for the respondent to commence work before the contract complied with the requirement of schedule 1B, s 14.[26]
  1. [52]
    Therefore, special condition 7 is wholly void.
  1. [81]
    There is no penalty regime for a breach of s 14 itself. I note it is different for variations, where penalties apply. If a contractor ignored the statutory requirements of s 14, there is no effective sanction against the behaviour, save as mentioned by Barlow KC DCJ, perhaps the catch-all penalty provision in s 30 Schedule 1B for commencing the contracted services before the contract complied with s 14. Where the work has not commenced however, such as was the case in Perera, and the contract ends without work commencing, there is no penalty.
  2. [82]
    I determine the failure of the builder to comply with the statutory requirements of ss 14(5) to (7) Schedule 1B amounts to contracting out of the Act and clause 4.2 of the contract is void.
  3. [83]
    If I am wrong about that, the same outcome follows given I determine clause 4.2 is misleading and deceptive and by s 77(3)(e) of the Act I find it to be an unjust contractual term and it should be of no effect.
  4. [84]
    The Tribunal’s powers extend beyond the determination and enforcement of contractual obligations and the powers granted by s 77(3)(e) are more extensive than those ordinarily exercised by courts in determining claims under building contracts.[10]
  5. [85]
    The contract bears all appearance of being a fixed price contract. A fixed price is noted in prominent position in the contract schedule. The schedule makes no reference to any general condition provisions being able to change the fixed price. There is no method stated, either in the contract schedule or in the general conditions, for calculating any change in the price.
  6. [86]
    Apart from the figure of $188,996.85 appearing in the schedule, the specifications set out precise costings in support of that fixed price across the scope of work of the contract. The stages of work entitling the builder to claim a defined percentage of the stated fixed price on completion of each stage are set out, and the sum total of all the stages is the amount of $188,996.85.
  7. [87]
    Ms Munro’s evidence was that she thought the contract was for a fixed price when she signed the contract and throughout the construction up to the time the parties fell out. I find that was not an unreasonable conclusion to draw.
  8. [88]
    Clause 4 is headed “Price and Payment”. Clause 4.1(b) says the price is the quoted price and that price is binding on the contractor. But then clause 4.2 provides:
  1. 4.2:
    The contractor reserves the right to change the price in the event of a variation to the contractor’s quotation. Any variation from the plan of scheduled works or specifications (including, but not limited to, any variation due to unforeseen circumstances, or as a result of increases to the contractor in the cost of materials and labour) will be charged for on the basis of the contractor’s quotation and will be shown as variations on the invoice. Payment for all variations must be made in full at the time of completion.
  1. [89]
    The word “variation” used in clause 4.2 bears an unusual meaning. It is not used in the sense usually understood in construction contracts to be an agreement between the parties to change the agreed scope of work for an agreed price. Clause 4.2 rather purports to give the builder unilateral power to change both the price for the agreed scope of work and the scope of work itself “due to unforeseen circumstances”. It allows the builder to increase the price of the contract where the cost of materials increases, or the builder’s labour costs increases, with the bases of any such cost increase or reduction left entirely opaque and at the discretion of the builder.
  2. [90]
    What occurred with respect to the builder’s claim for payment of the practical completion stage is enlightening. The builder claimed payment for the full practical completion payment. Ms Munro responded by email dated 28 July 2021:

It appears the contract you gave me is a fixed price building contract. Your last invoice for $28,349.53 is the final payment of the contract. However, the work listed in the contract has not been completed and the damages/defects have not been rectified in accordance with the practical completion and final completion stages of the contract. Until this is done you are not entitled to the final payment.

  1. [91]
    The builder responded by purporting to remove items of work not done from the practical completion stage by “variation.” Such is arguably within the range of possibilities granted by clause 4.2. The builder’s attempt to do that, absent the consensus of the other party, in what otherwise appeared to be a fixed price contract, makes clause 4.2 a misleading, deceptive and unjust provision.

The builder’s claim for payment of some of the practical completion stage work

  1. [92]
    Under the contract the payment for the practical completion stage was $28,349.53.  In the proceedings the builder maintained a reduced claim for $18,899.69 “owing as at practical completion”.[11] This was the amount left after the builder excluded various items of work from the practical completion stage by way of “variation.”
  2. [93]
    By s 1 Schedule 1B of the Act, practical completion is defined:

… 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.
  1. [94]
    To claim the practical completion stage payment the builder was required to have completed the work and all statutory requirements other than minor defects or minor omissions that would not unreasonably affect occupation.
  2. [95]
    The builder did not do that here. I have found it could not rely on clause 4.2 to change the agreed work to be done in the practical completion stage.
  3. [96]
    Ms Munro refused to countenance a reduced scope of work, as was her right. In an email dated 28 July 2021 she made clear the following work remained outstanding – Invisigard screens, Hekka hoods, tiling (entrance floor), floor tiles (entrance), floor sanding, stairs (external), balustrades and handrails. She quoted the value of that outstanding work at $18,418.27 based on quotations she had obtained (although the quotations were not put into evidence).
  4. [97]
    The work to be done by a contractor to achieve practical completion is important. If the work is not done the failure may disqualify a contractor from claiming any part of the practical completion payment: Cochrane v Lees [2021] QCATA 74 [84]-[85]; Thallon Mole Group [268]-[269].
  5. [98]
    In the matter at hand I find there was a significant amount of work yet to be done by the builder to complete the practical completion stage when the builder claimed payment for the work. Until all the practical completion stage work had been done, save for minor defects and minor omissions, the builder had no entitlement to payment for the stage.
  6. [99]
    Building contracts are not uncommonly construed as entire, which is to say all the work required to be performed in stages must be complete before any payment for any of the work in the stage is earned.[12] There is nothing in the general conditions to suggest the builder was allowed to claim incremental payment for work done in the course rather than at the end of the stages of work.
  7. [100]
    Claiming a part payment as the builder did, and then when challenged refusing to resile from that claim I determine amounted to repudiation of the contract by the builder. That repudiation entitled Ms Munro to terminate it, which I find she did and communicated her termination to the builder by commencing these proceedings in the Tribunal.[13]

Variations

  1. [101]
    The builder’s claim for variations was set out as follows:

Variation work done additional

to the contract $31,066.00

Less variations removed from

the contract $21,557.88

$  9,508.12

Less prime cost and provisional

sum adjustments to the contract $  3,980.00

Total $  5,528.12

  1. [102]
    In the course of the proceedings the builder added a further claim for “unclaimed expenses” of $6,443.92:

Variation Quoted amount Actual cost incl margin

  1. Hekka Hoods changed

to  supply & install

Coreten hoods $ 2,445.00 $ 2,796.00

  1. Lockhaus windows $51,660.00 $53,426.52
  2. Lockhaus windows

unload and mantou hire not in contract $    792.00

  1. Dog flap installation $   180.00
  2. Reconstruct Cupola roof $ 2,000.00 $ 5,354.40

Subtotal $56,105.00 $62,548.92

Less $56,105.00

Not charged $6,443.92 

  1. [103]
    None of the above variations were submitted in writing to Ms Munro for approval before the work was done. The requirements for variations are set out in Part 6 of Schedule 1B QBCC of the Act:

40 Variations must be in writing

  1. This section applies if there is to be a variation of a regulated contract.
  1. The building contractor must give the building owner a copy of the variation in writing before the first of the following happens—
  1. 5 business days elapse from the day the building contractor and the building owner agree to the variation;
  1. any domestic building work the subject of the variation starts.

Maximum penalty—20 penalty units.

  1. The building contractor may give the building owner the variation under subsection (2)—
  1. personally; or
  1. by sending it by post, facsimile or email; or
  1. in accordance with any provision in the contract providing for service of notices on the building owner by the building contractor.
  1. In a proceeding for a contravention of subsection (2), it is a defence for the building contractor to prove that—
  1. the variation is for domestic building work that is required to be carried out urgently; and
  1. it is not reasonably practicable, in the particular circumstances, to produce a copy of the variation in writing before carrying out the work.
  1. The building contractor must not start to carry out any domestic building work the subject of the variation before the building owner agrees to the variation in writing.

Maximum penalty—20 penalty units.

41 General contents of document evidencing a variation

  1. The building contractor under a regulated contract must ensure a document evidencing a variation of the contract complies with the formal requirements for a variation.

Maximum penalty—20 penalty units.

  1. The document evidencing the variation complies with the formal requirements if it—
  1. is readily legible; and
  1. describes the variation; and
  1. states the date of the request for the variation; and
  1. if the variation will result in a delay affecting the subject work—states the building contractor’s reasonable estimate for the period of delay; and
  1. states the change to the contract price because of the variation, or the method for calculating the change to the contract price because of the variation; and
  1. if the variation results in an increase in the contract price—states when the increase is to be paid; and
  1. if the variation results in a decrease in the contract price—states when the decrease is to be accounted for.
  1. Any increase in the contract price as a result of the variation can not be required to be paid before work the subject of the variation is started.
  1. [104]
    There is no obligation under the present statutory scheme for variations to be signed by both parties. The requirement in s 40(5) Schedule 1B is that the owner must agree to a variation in writing. Writing has the meaning given to it in the Acts Interpretation Act 1954 (Qld), namely:

Writing includes any mode of representing or reproducing words in a visible format…

  1. [105]
    That means the parties could agree to a variation by email.
  2. [106]
    The current statutory provisions were introduced by the Queensland Building and Construction Commission and other Legislation Amendment Act 2014 (Qld) and they are markedly different to the provisions found in the DBC.
  3. [107]
    Under the DBC s 79(4) if a variation consisted of an addition to the work to be done none of the additional work was to be done before a variation document was signed by the parties. If that was not done, or any one of a myriad of other requirements not complied with, then the contractor was not entitled to recover an amount for the variation.
  4. [108]
    If the variation had been sought by the contractor, there was no avenue of claim available.
  5. [109]
    If the owner had sought the variation, recovery by the contractor was possible but the contractor was obliged to apply to the Tribunal for approval to recover an amount and establish either that there were exceptional circumstances warranting a payment or that the contractor would suffer “unreasonable hardship” if not paid.
  6. [110]
    The provisions were strictly applied[14] and a source of great disgruntlement to contractors.
  7. [111]
    It is within this historical context that the changes made to the variation provisions by the Queensland Building and Construction Commission and other Legislation Amendment Act 2014 (Qld) should also be construed.
  8. [112]
    The penalty provisions concerning failure to comply with the requirements of now ss 40 and 41 Schedule 1B were also in place prior to the transfer to Schedule 1B, but the other hurdles facing a contractor’s recovery of variations have gone.
  9. [113]
    It seems to me the legislature’s intention with respect to variations has entirely changed with the new Schedule 1B provisions. Section 108D does not trigger where there is a failure to comply with the much reduced variation requirements, but rather s 44 of Schedule 1B applies.
  10. [114]
    If s 108D was triggered for a breach of the provisions of ss 40 and 41, that would have the effect of reintroducing the harsh regime preventing a contractor’s recovery for variations under the DBC, but absent even the fall back of an application to the Tribunal to show that there were exceptional circumstances warranting a payment or that the contractor would suffer “unreasonable hardship” if not paid.
  11. [115]
    That cannot have been the intention of the legislation.
  12. [116]
    The explanatory notes to the introduction of the Bill said this about failure to comply with the variation requirements of s 40 and s 41 of Schedule 1B:

New section 40 (Variations must be in writing) provides that the building contractor must ensure that a variation to the contract is provided in written form to the building owner either 5 business days from the day the parties to the contract agree to a variation or before any domestic building work which is the subject of the variation starts, whichever is the earliest to occur. A maximum penalty of 20 penalty units applies for failure to comply. Also the building contractor must not carry out any domestic building work which is the subject of the variation until the building owner has agreed in writing. A maximum penalty of 20 penalty units applies for failure to comply.

New section 41 (General conditions of document evidencing a variation) provides that the building contractor under a regulated contract must ensure a document evidencing a variation of the contract complies with the formal requirements for a variation. A maximum penalty of 20 penalty units applies for failure to comply.

  1. [117]
    The same penalty regime as applied under the DBC continued with the transfer of the provisions, with changes, to Schedule 1B, absent the roadblocks to recovery placed in the DBC. Under the DBC however, there was no suggestion that failure to comply with the statutory requirements for variations made variations or the contract void. There is no suggestion that such a fundamental shift was intended with the re-siting of the provisions to Schedule 1B. Rather surely the emphasis was on the lifting of the previous hurdles inhibiting a contractor’s recovery of non-compliant variations.
  2. [118]
    Indeed in Boys v Imperial Homes (Qld) Pty Ltd  [2024] QCATA 35 Judicial Member D J McGill SC said this about the current statutory scheme for variations:
  1. [49]
    … The Act does not provide that remuneration cannot be recovered for undocumented variations, and s 44 expressly provides that a failure to comply with the statutory provisions for documentation does not make the contract unenforceable.[32]
  1. [32]
    Prior to 1 July 2015, the Domestic Building Contracts Act 2000 (Qld) s 84 contained restrictions on recovery for undocumented variations, but that Act has since been repealed.
  1. [52]
    It is possible to formulate a contract in such terms that no amount will be payable for any additional work not otherwise encompassed by the contract unless it is documented in a particular way, but some care would be necessary in order to do this with sufficient clarity to prevent the ordinary consequence from following when someone asks a tradesman to do something, in circumstances where the natural implication is that it will be paid for. There is nothing in Clause 20 which would be effective to exclude that. It is always relevant to consider whether the alleged variation is not more than part of the work required under the contract anyway, but so long as that is not the case, there is nothing in the Clause, or in the Act, to the effect that the owner gets that work for free, as the builder is not entitled to charge for it.
  1. [119]
    Accordingly I determine a contractor may be entitled to recover for variations despite failure to comply with the formalities set out in ss 40 and 41 of Schedule 1B. The failure of parties to comply with the current statutory requirements for variations triggers s 44 of Schedule 1B, failure to comply with statutory requirements, rather than s 108D of the Act, contracting out.
  2. [120]
    I turn to the variations in the matter at hand.

Variations

  1. [121]
    Simply because the builder does additional work does not mean the value of the work can be recovered as a variation.
  2. [122]
    Ms Munro says she was never informed by the builder about variation work being necessary before the work was done. She says she was not given an opportunity to discuss them or disagree with them.
  3. [123]
    In an email from her to the builder dated 25 May 2021 she stated she knew there was extra framing “of the pop outs” early on but that that was the only item she was informed about. The builder responded by email on 26 May 2021 detailing “extras incorporated once it was discovered that these items were required”:

Battening the walls

Kitchen extra work

Fascia

Raising roof for insulation

Insulation upgrade

Plumber extras

  1. [124]
    Attached to that email was an unhelpful running sheet setting out workers’ hours and expenditure on such vague and non-descript items as framing pine, plasterboard, electrician, Hank-plastering and many more, fixing, damp course, electrician. Some are clearly items of work within the scope of work of the contract such as three items marked window payment respectively for $29,965, $9,655 and $4,856.80.
  2. [125]
    There is no mention of battening the walls or kitchen extra work or the other items referred to in the email, although there is mention of fascia in an amount of only $328.50, and insulation in an amount of $451.82. There is nothing entitled plumber extras, but there is an item plumber of $290.30.
  3. [126]
    The following exchange occurred at hearing between Ms Munro and Mr Skerke, the builder’s lead carpenter, during Mr Skerke’s cross-examination by Ms Munro:

You say in your statement that:

On multiple occasions I spoke with Janeece Munro alone and once with Adam Cameron about some extra work not in the contract.

How many is multiple occasions?---Multiple – well, at least three or four. At least, for sure.

Okay. What exactly was said on these occasions that you were spoke – you spoke alone with me?---That you’ve said that everything that needed to be completed to make what your build wanted to be, to be done at all times.

And what was the work that wasn’t in the contract that you discussed with me?---The battening to make the Pro Clima suitable for what it needed to be done and – mostly that. Just the battening.

But how do you know that that wasn’t in the contract?---Well, from the start even you and yourself said – well, we never knew what it was actually needed to be done to get that, but I – yeah. I didn’t know that it wasn’t in the contract, but I knew that it was going to be a variation in the end.

How?---Because we needed to do it to get it done. To get – to make the Pro Clima work.

So how did you know it was going to be a variation and it wasn’t in the contract?---I didn’t know that it wasn’t in the contract, but I knew we had to do it to get what you wanted done.

…

Okay. Did you ever see a copy of the contract?---Nuh.

Describe the conversation you referred to on the one occasion when Adam Cameron was present?---I just remember all three of us having a conversation saying that we need – to achieve what you wanted, we needed to keep going. We would, I don’t know, work it out at the end with the variations side of things.

Do you know remember where that one conversation that you’re referring to occurred?---I’m pretty sure it was at your front door – out the front in your front courtyard.

So what type of work was that referring to when we were talking in the courtyard with Adam?---The battening and everything that we had to do to make the Pro Clima work.

  1. [127]
    The builder offers no excuse for not seeking approval for variations. Mr Cameron said in cross-examination by Ms Munro:

Okay. What’s your understanding of a variation in how it needs to legally be done in – in builder’s – in building contracts?---Variations are written upfront or within five days of – of requesting the variation.

And what do they need to contain in that – what sort of information do you need to put in there?---Scope for works and a cost.

And did you do that on any of the variations you gave to me?---No.

Why not?---Oh, well, the – the big one in there, the – the battening, is because we didn’t know what we were going to keep uncovering as we went around the building. The other ones are – I – my only excuse is that we were overloaded with work and I was just trying to get on and get it down.[15]

  1. [128]
    Save for pop-outs, Ms Munro disputes that extra work was done. She maintains all work save for the pop-outs was part of the original scope of work of the contract.[16]
  2. [129]
    The builder made much of the extra work done installing an air tight “bubble” wrap product called Pro Clima. The builder found it difficult to install and it took much more time and work (extra battening) than the builder had originally allowed for in its quote.
  3. [130]
    However the builder had been on notice about use of the wrap from outset. A notation on the plans for the job specifically referred to it. On plan CDL-17.2828-1 concerning the upper floor, it is clearly stated “install insulation and air tight bubble wrap”. In so far as additional costs were incurred installing it, that extra cost should have been taken into consideration when the builder first quoted on the job.
  4. [131]
    I find the extra cost of battens associated with installation of the wrap is not a valid variation. If it cost more than originally estimated to fit the wrap, that was a cost the builder had to bear, not Ms Munro.
  5. [132]
    Ms Munro concedes that there was one variation discussed concerning pop-out windows. She answered some questions I put to her about that as follows:

Now, your evidence is that, except for the Bay window, the pop-out, there was no discussion about variations?---No.

“No” meaning you agree with me?---That’s correct.

All right. Okay. All right. Except there was a discussion about the Bay window, but do you say that was never finalised? It was never agreed?---It – there was no – nothing – there was no figure given to me. There was nothing put in writing. I didn’t sign anything before the work. It didn’t meet the legal requirements of a variation, which I later found out what they were, on that particular thing.

So you didn’t agree to anything about those – to the builder performing the work for the pop-outs?---Well, I knew it needed to be done, and I agreed for it to be done.

You did agree. Yes. Go on. What did you agree?---I agreed that there needed to be – that there needed to be some structural work done to support the pop-outs at the – in the upstairs.

All right. But did you - - -?---Because otherwi – if you took the bottom ones down, otherwise structurally it wouldn’t be strong enough.

All right. Let me put it this way: did you say, “Okay. Go ahead and do it.”?---I said, “If it needs doing, it needs doing.”

All right. You didn’t say, “Give me a price first.”?---No.

All right?---No. I didn’t know that I – I – I thought he would give me the price, but I didn’t know that all that had to be done beforehand. And then as the – the months went on and I kept sending emails saying, “How much extra is this,” I never got a figure.

And eventually the variation for the pop-out was how much?---I – I don’t know. It’s in – it’s in the respondents’ documents over there.[17]

  1. [133]
    There must be mutual intention by the parties to vary a contract.[18] Where additional work is performed absent that mutual agreement, the builder is not entitled to be paid for it simply because the builder has expended time and resources and the owner has benefited.[19]
  2. [134]
    That the builder is out of pocket and the owner has gained an unpaid advantage does not mean the owner must pay a reasonable amount for what has been gained. Such a restitutionary claim in quantum meruit has been ruled out by the High Court where that recovery would compromise the contractual arrangements agreed between the parties: Mann v Peterson Constructions Pty Ltd (2019) 267 CLR 560 [17]-[21].[20]
  3. [135]
    In the email to Ms Munro of 26 May 2021 the builder also claims $3,744 as the cost of adding and painting new fascia. The cost of roofing, fascia and guttering was based on a quotation from Fosters Roofing and Guttering Pty Ltd given to Ms Munro. Mr Cameron said that quotation did not include fascia. There was no fascia on the house when the work commenced. When the builder was installing the bubble wrap however, it was realised fascia was necessary to terminate the roof wrap.
  4. [136]
    Ms Munro agreed she had not asked Fosters Roofing to add that item to their quote. I accept the cost of adding fascia and painting was a necessary variation to the contract and not within the contemplation of any of the relevant parties, Ms Munro, the builder or Fosters Roofing and Guttering Pty Ltd at outset of construction. Ms Munro thought the wrap was a very important part of the project however, and accepted if there was necessary work to be done to ensure the wrap worked, it should be done.
  5. [137]
    The builder is entitled to the reasonable cost of that work. The builder claims $3,744. How that figure is arrived at is not made clear. Ms Munro makes no comment about the cost.
  6. [138]
    In the specifications there is an amount allowed for the Fosters Roofing and Guttering Pty Ltd work, but there is an additional amount allowed for 8sqm of roofing (including fascia and gutter).
  7. [139]
    Without explanation what that amount was for, and given the builder maintains there was no allowance for fascia under the contract, but has claimed an amount of 600 for that as part of the contract price, I allow an amount of $3,744 less $600 making $3,144 for the variation.
  8. [140]
    The builder supplied a revised list of variations in another email to Ms Munro dated 12 July 2021. In this list the builder purported to give credits for items of work removed from the practical completion stage by way of variation. That has been addressed above.
  9. [141]
    Ignoring the credits, the variations are entirely broad brush: extra plumbing; prop shed and sheet internal shed wall; batten out wall frames for cladding; supply install and paint fascia and soffit blocking; raise roof level to allow for insulation; fc sheet verandah ceiling; laundry cupboard fit out; extra plastering. There is no attempt made by the builder to distinguish this work from the original work to be performed under the contract. The additional battening required to allow the bubble wrap to be installed has already been discussed and the cost falls to the builder. Similarly the fascia. On the plans there is a note “Install insulation and ceiling to verandah”, which should have put the builder on notice that sheeting the verandah ceiling was required under the contract.
  10. [142]
    Ms Munro said she was not asked about any of the other variations save for the additional structural work for the pop-outs.
  11. [143]
    I accept that, save for the matter of “pop outs”, Ms Munro was ignorant of the fact that variation work was performed by the builder and in so far as she was aware work was being done she understood it was work within the scope of the original contract.
  12. [144]
    With respect to the pop-outs, the builder seeks $2,015 for “new pop out roofs” plus an amount of $1,521 for “Repairs, structural strengthening and framing for insulation for pop outs”.
  13. [145]
    The third page plan detail showing upper and lower floor windows and doors bears a note above a pop-out area on the upper floor “new roof over pop out”. I determine that a new roof over the pop-outs was therefore included or should have been included in the original scope of work. The builder is not entitled to claim that oversight as a variation. The builder is not entitled to claim for the pop-out roofs.
  14. [146]
    Ms Munro however does not challenge that she agreed to variations to the pop-out windows itself. The claim is in the amount $1,521. There is no detail, but Ms Munro makes no challenge to that cost claimed. It is allowed.
  15. [147]
    The allowable variations therefore total $4,665.

Extra unclaimed expenses

  1. [148]
    The builder’s claim to $6,443.92 for additional charges added to the counter application is not made out. The onus lies on the builder to prove the claims and the builder fails to do that. Ms Munro disputes that the dog flap was not part of the scope of work, and in her statement of evidence she states that the Hekka Hoods (sun shades) were never supplied.[21] Similarly she says the costs of unloading windows was within the original scope of work, which seems entirely probable.
  2. [149]
    The builder fails to explain why the reconstruction of the cupola roof was necessary and amounts to a variation.
  3. [150]
    The builder offers no cost evidence in support of any of the charges. The claim for the value of extra unclaimed expenses fails.

Items supplied or purchased by Ms Munro

  1. [151]
    Ms Munro claims $16,914.15 representing materials she paid for but which she says was the responsibility of the builder to supply under the contract.
  2. [152]
    The difficulty here is that Ms Munro fails to clarify whether the materials concerned were used or installed as part of any of the finished and paid stages of work, or if they were intended for installation in the practical completion stage. If the latter, she has not paid the builder for any part of the work, and had the builder completed the practical completion work, she would have been obliged to pay for these items under the contract anyway.
  3. [153]
    The matter is far from clear on the confusing evidence from both parties.
  4. [154]
    It seems probable that they have been used or installed as intended, either by the builder or by Ms Munro after the builder left the site, given Ms Munro has evidently continued with the work after termination. There are no particulars supplied about that, however in her statement of evidence she states:

Over the past 18 months and whilst waiting for QCAT to help with the issues in dispute, I have been trying to finish the unfinished work in the contract and repair as many of the defects/damages as possible.[22]

  1. [155]
    In practical terms what Ms Munro was entitled to claim following the builder’s breach of contract was the difference between the cost of completion of the contract by another contractor less the contract price, and if the cost of completion she was put to was more than the original contract price, she was entitled to the difference as damages for incomplete work.
  2. [156]
    But there is no such material before me. It is impossible to determine whether the work has been finished, if completed whether the project has cost Ms Munro more than the cost under the original contract, or she has paid less, including her payments for items the builder was supposed to supply under the contract but did not.
  3. [157]
    On the limited evidence presented she is not entitled to claim separately the cost of items paid for by her without consideration of her loss or gain under the contract overall.

Rectification of defects

  1. [158]
    Ms Munro claims $3,030.80 for rectification of defective work. It is not made clear how that figure is arrived at.
  2. [159]
    In an attachment to her statement of evidence[23] entitled “Defective work and damage rectified” she makes complaint about many things, a mixture of defects, damaged items and items of incomplete work.
  3. [160]
    The complaints about defective work include damage to the windows and doors and glass and that is addressed separately below.
  4. [161]
    Other items of defective work are minor things: a broken clothesline $175; torn flywire screen $50; gate not closing properly $50; broken shed door lock $22; damage to electrical cable under balcony $280. Separately she claims an additional global figure $401.50 apparently for labour, without discriminating between the costs associated with the separate items or whether it be defective work or incomplete work.
  5. [162]
    There are numerous matters of complaint, many very trivial, many without any amount for cost of repair. There are no supporting receipts. I am not prepared to make an order that the builder pay the unsupported claims in absence of some documentary proof of the damage and reasonable costs of repair.
  6. [163]
    Mr Simmons, a building estimator engaged by the builder, was asked to assess damages and defects. He attended the site, inspected and concluded in a report that the costs of defects, which included replacement of seven metal roofing sheets, was $1,818.16. I accept Mr Simmons’ evidence. He gave evidence impartially and seemed competent.
  7. [164]
    Ms Munro is allowed that sum of $1,818.16 for cost of rectification of defective work.

Passive house design

  1. [165]
    Through the course of the proceedings Ms Munro has changed her claims from time to time. She had claimed “restitution of $100,000 for not delivering the renovation aim.” She did not mention that claim at commencement of hearing when asked what relief she sought, but I have no confidence that she intended to resile from the claim.
  2. [166]
    Ms Munro claimed the house renovation was to be built using passive house design principles. There is nothing in the contract to show that passive house construction following passive house design principles was any aspect of the agreement between the parties, save for the inclusion of Pro Clima wrap as an insulation product.
  3. [167]
    In any case, even if passive house design played a part, Ms Munro’s complaints that passive house design principles were breached are not supported by independent evidence. There is no independent expert evidence offered, either about passive house design principles, their application here or how the principles might have been breached.
  4. [168]
    There is no evidence that she has suffered any damage from a failure of those design principles, let alone $100,000 as claimed.
  5. [169]
    The claim fails.

Windows and doors

  1. [170]
    Ms Munro claims $10,000 for damage done by the builder to windows and doors. It is not clear how that amount is calculated.
  2. [171]
    Ms Munro provides a quotation from Scratchless Glass Australia dated 18 June 2022 which talks of scratch removal from the glass of five windows at a cost of $1,995. She also provides a quotation from the Timber Doctor dated 30 July 2022 of $638 for “surface repairs such as scuffs, dents and chips to inside new windows and doors.”
  3. [172]
    It is unclear what qualifications either person quoting hold. Neither attended to give evidence at the hearing.
  4. [173]
    Mr Simmons, the building estimator, provided a report and gave evidence however. He was cross-examined by Ms Munro about his report in which he stated he had attended and inspected certain windows and doors and his estimated cost of rectification of what he found to be minor marked timber windows was $300. He does not address the problem of scratched glass, but rather simply the timber surrounds.
  5. [174]
    The builder does not challenge the claim that the new windows suffered some minor scratches during construction. They were expensive items (they cost approximately $50,000) and specialist products (imported and featuring argon gas between glass panes). I accept that the glass was scratched by the builder. The only evidence of the cost of repair of the scratches to the glass is from Scratchless Glass Australia in the sum of $1,995. I allow Ms Munro that amount.
  6. [175]
    Concerning the cost of repair to the timber surrounds, I prefer the evidence given by Mr Simmons about the cost of repair to that given by the Timber Doctor, who did not attend the hearing to explain his estimate. I allow Ms Munro the amount of $300 for that cost of rectification.
  7. [176]
    How the balance of damages claimed by Ms Munro increases to $10,000 is not explained. No other amount is awarded.

Additional claims

  1. [177]
    Ms Munro also claims a miscellany of minor things such as kitchen splashback tiles $51.17, tiling $192.50, new clothesline $175 and new door handle for shed door $22. There are no details showing how the charges amount to the amount claimed of $2,629.10 and how these expenses are the responsibility of the builder. Again there are no receipts or other documentary evidence supporting the claims.
  2. [178]
    These additional claims are not made out.

Conclusion

  1. [179]
    Ms Munro is entitled to $1,995 as the cost of repairs to scratched windows and doors.
  2. [180]
    She is also entitled to the sum of $300 for rectification of minor marked timber framing to windows.
  3. [181]
    Ms Munro is also entitled to the cost of rectifying defective work in the amount of $1,818.16.
  4. [182]
    The builder is not entitled to any part of the practical completion stage payment.
  5. [183]
    The builder is not entitled to claim for variations save $1,521 for pop outs and $3,144 for the cost of adding and painting fascias.
  6. [184]
    On balance between the parties Ms Munro must pay the builder the sum of $551.84.

Footnotes

[1]  In breach of Queensland Building and Construction Commission Act 1991 (Qld) Schedule 1B s 14(3)(f) and (g).

[2]  In breach of Queensland Building and Construction Commission Act 1991 (Qld) Schedule 1B s 29(4).

[3]  s 40 Schedule 1B and s 108D of the Act.

[4]  [228].

[5]  [25].

[6]  [111].

[7]  Record of Proceedings, Second Reading.

[8] Thallon Mole Group [405].

[9]  [6].

[10] French v NPM Group Pty Ltd [2008] QSC 48 at [21] per McMurdo J referring to the power of the Commercial and Consumer Tribunal to make declarations under the then equivalent s 77(2)(e) of the Queensland Building Services Authority Act 1991 (Qld).

[11]  Response and counter-application [48].

[12] Tan Hung Nguyen v Luxury Design Homes Pty Ltd [2004] NSWCA 178 per McColl J [27].

[13] Heyman v Darwins Ltd [1942] AC 356, 362; 1 All ER 337.

[14] Allaro Homes Cairns Pty Ltd v O'Reilly & Anor [2012] QCA 286.

[15]  T1-89 L33-45.

[16]  T1-28 L1-3.

[17]  T1-27 L5-37.

[18] Cellarit Pty Ltd v Cawarrah Holdings Pty Ltd [2018] NSWCA 213 [232] per McColl JA; Moratic Pty Ltd v Lawrence James Gordon & Anor [2007] NSWSC 5 [21] per Brereton J (‘Moratic’).

[19] Moratic [22]-[26].

[20]  Per Kiefel CJ, Bell and Keane JJ.

[21]  Ex 2 (although it appears Coreten Hoods were supplied).

[22]  Ex 2.

[23]  Ex 2.

Close

Editorial Notes

  • Published Case Name:

    Munro v Camdun Pty Ltd t/as Asset Carpentry & Building Supplies

  • Shortened Case Name:

    Munro v Camdun Pty Ltd t/as Asset Carpentry & Building Supplies

  • MNC:

    [2024] QCAT 452

  • Court:

    QCAT

  • Judge(s):

    Member Howe

  • Date:

    18 Oct 2024

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
Allaro Homes Cairns Pty Ltd v O'Reilly [2012] QCA 286
2 citations
Jump To
Cite 1 - [2012] QCA 286
Cite 2 - [2012] QCA 286
Boys v Imperial Homes (Qld) Pty Ltd [2024] QCATA 35
3 citations
Jump To
Cite 1 - [2024] QCATA 35
Cite 2 - [2024] QCATA 35
Cite 3 - [2024] QCATA 35
Caltex Oil (Aust) Pty Ltd v Best (1990) CLR 516
2 citations
Jump To
Cite 1 - (1990) CLR 516
Cite 2 - (1990) CLR 516
Cellarit Pty Ltd v Cawarrah Holdings Pty Ltd [2018] NSWCA 213
2 citations
Jump To
Cite 1 - [2018] NSWCA 213
Cite 2 - [2018] NSWCA 213
Cochrane v Lees [2021] QCATA 74
2 citations
Jump To
Cite 1 - [2021] QCATA 74
Cite 2 - [2021] QCATA 74
French v NPM Group Pty Ltd [2008] QSC 48
2 citations
Jump To
Cite 1 - [2008] QSC 48
Cite 2 - [2008] QSC 48
Harvey v Minister for Primary Industry and Resources [2024] HCA 1
2 citations
Jump To
Cite 1 - [2024] HCA 1
Cite 2 - [2024] HCA 1
Heyman v Darwins Limited (1942) AC 356
2 citations
Jump To
Cite 1 - (1942) AC 356
Cite 2 - (1942) AC 356
Lieberman v Morris (1944) 69 CLR 69
1 citation
Jump To
Cite 1 - (1944) 69 CLR 69
Mann v Paterson Constructions Pty Ltd (2019) 267 CLR 560
2 citations
Jump To
Cite 1 - (2019) 267 CLR 560
Cite 2 - (2019) 267 CLR 560
Moratic Pty Ltd v Gordon (2007) NSWSC 5
2 citations
Jump To
Cite 1 - (2007) NSWSC 5
Cite 2 - (2007) NSWSC 5
Perera v Bold Properties (QLD) Pty Ltd(2023) 3 QDCR 132; [2023] QDC 99
2 citations
Jump To
Cite 1 - [2023] QDC 99
Cite 2 - [2023] QDC 99
Plaintiff S297/2013 v Minister for Immigration and Border Protection (2014) 255 CLR 179
2 citations
Jump To
Cite 1 - (2014) 255 CLR 179
Cite 2 - (2014) 255 CLR 179
Plaintiff S297/2013 v Minister for Immigration and Border Protection [2014] HCA 24
2 citations
Jump To
Cite 1 - [2014] HCA 24
Cite 2 - [2014] HCA 24
Tan Hung Ngyuyen v Luxury Design Homes Pty Ltd (2004) NSWCA 178
2 citations
Jump To
Cite 1 - (2004) NSWCA 178
Cite 2 - (2004) NSWCA 178
Thallon Mole Group Pty Ltd v Morton [2022] QDC 224
2 citations
Jump To
Cite 1 - [2022] QDC 224
Cite 2 - [2022] QDC 224
Venamore t/as Kobble Gardens v Reynolds (2003) QCCTB 71
2 citations
Jump To
Cite 1 - (2003) QCCTB 71
Cite 2 - (2003) QCCTB 71

Cases Citing

Case NameFull CitationFrequency
Fitzgerald v Ryan McLaren [2025] QCAT 3072 citations
MA & SK Jokovich Pty Ltd v Garland [2025] QCAT 1912 citations
1

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