Fleming v Commissioner of State Revenue
[2025] QCAT 118
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- Unreported Judgment
- Fleming v Commissioner of State Revenue[2025] QCAT 118
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Fleming v Commissioner of State Revenue[2025] QCAT 118
Fleming v Commissioner of State Revenue[2025] QCAT 118
QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL
CITATION: | Fleming & Anor v Commissioner of State Revenue [2025] QCAT 118 |
PARTIES: | bradley joel fleming (applicant) GEORGIA SHIELA SIMPSON (applicant) v Commissioner of State Revenue (respondent) |
APPLICATION NO/S: | GAR526-23 |
MATTER TYPE: | General administrative review matters |
DELIVERED ON: | 25 March 2025 |
HEARING DATE: | 14 March 2025 |
HEARD AT: | Brisbane |
DECISION OF: | Member Richard Oliver |
ORDERS: |
|
CATCHWORDS: | TAXES AND DUTIES AND HOME OWNERS GRANT – ADMINISTRATIVE DIRECTION – QUEENSLAND – where applicants entered into a building contract with a sole trader builder – where the sole trader builder’s business transitioned to a corporate entity – where the corporate entity did not hold a builder’s licence at the time of contracting with the applicant – where applicants applied for the HomeBuilder Grant – where application for Grant rejected on the grounds that the applicants contracted with the unlicensed corporate entity and not the sole trader – where evidence that the corporate entity carrying on business – whether building contract was entered into with a licensed sole trader or an unlicensed corporate entity the Queensland Building and Construction Act 1991 (Qld) – whether Grant payable to the applicants Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 20, s 21 and s 24 First Home Owner Grant and Other Home Owner Grants Act 2000 (Qld) Commissioner of State Revenue v Lewis [2024] QCATA 126 Inghams Enterprises Pty Ltd v Kim Yen Tat [2018] QCA 182 Andrew Robertson & Jeannie Paterson, Principles of Contract Law (Lawbook Co., 6th ed, 2020) |
APPEARANCES & REPRESENTATION: | |
Applicant: | Self-represented |
Respondent: | Ms Kable of counsel instructed by the respondent in-house legal service. |
REASONS FOR DECISION
Background
- [1]The applicants are the owners of a house at Manly West. On 28 December 2020, they entered into a standard form Housing Industry of Australia building contract, more particularly described as a Queensland Alteration, Addition and Renovation Contract (QC3) (“the contract”) with Austin Construction Co. The works to be carried out were “renovation of brick highset building, new bathrooms, kitchen, full restoration” as noted in item 9 of schedule 1 of the contract. The contract price was $319,999.00.[1]
- [2]An extract from the Australian Securities and Investment Commission (“ASIC”) records that as at the contract date, Austin Construction Co was a registered business name and the holder of the business name is recorded as Samuel Austin.[2] An individual licence search of the records of the Queensland Building and Construction Commission (“QBCC”) record that as at the contract date, Samuel Austin held a low rise builder’s licence being licence number 15032157. The Australian Business Number (“ABN”) recorded in both extracts is 36 990 178 298. It is not disputed therefore that at the date of the contract Mr Austin conducted the business of a registered builder under the name and title of Austin Construction Co (“Austin”).
- [3]Turning then to the contract, schedule 1, item 3 records that the owners are the applicants, “Bradley Fleming & Georgie Simpson”. Their residential address is recorded, the works site, as well as their contact details.
- [4]Item 4 contains the “Building Contractor(s)” details. Rather than set out those details, the actual layout of those is set out below.
Name Austin Construction Co Address 2560 Moggill Rd pinjara hills [sic] Suburb State Postcode 4069 ABN90 642 886 726 ACN 642 886 726 Work Mobile XXXXX Building Contractor’s Licence Number 15032157 HIA Member Number 1213565 HIA Membership Expiry 31/3/2021 Please note that building contractor’s details must be as per licence. |
- [5]It is apparent to the keen observer that the ABN recorded on the ASIC and QBCC extracts is different to that recorded in item 4 of schedule 1. The ABN in item 4 is for Austin Constructions Pty Ltd CAN 642 886 726 which was incorporated on 23 July 2020 (“the company”). An extract from the QBCC records that the company was issued a builder’s licence on 24 May 2021, with Mr Austin named as the nominee. Mr Austin’s building business has been operated using that company vehicle since about that time. Samuel Austin is a director of the company.
- [6]As the contract was entered into between 4 June 2020 and 31 March 2021, it attracted the Commonwealth’s HomeBuilder Grant administered under the First Home Owner Grant and Other Home Owner Grants Act 2000 (Qld). That is, for an eligible transaction and compliance with the Administrative Direction (“the Direction”) issued jointly by the Queensland State Government and the Australian Government, a homeowner can receive a grant of $25,000 for renovations to their home. At face value, the applicants were eligible for the grant. However, the contract must be with a licensed builder.[3]
- [7]The applicants applied for the grant and provided all necessary material to the respondent for consideration. The application for the grant was rejected in a letter to the applicants on 29 August 2022.[4] The reason for the rejection was because the Commissioner considered, despite the identity of the builder on the contract, that the applicants had in fact entered into a contract with a different entity to that on the contract, Austin Construction Pty Ltd. The company did not hold a builders licence at the time of the contract. Interestingly in the letter of rejection, there was no reference at all to the business name, Austin Construction Co being the contracting party, nor the ABN of the company. The letter simply states that:
Documentation provided as part of your application evidences that you entered into a renovation contract on 28 December 2020 with Austin Construction Co Pty Ltd. As such, Austin Construction Co Pty Ltd is required to hold an appropriate licence issued prior to 29 November 2020.
- [8]The letter goes on to reiterate that the applicants entered into the contract with the company and makes no reference to the actual entity named on the contract. It is as though this distinction was not noted by the decision-maker.
- [9]The applicant, through their solicitors, sought an internal review of that decision. On 5 June 2023, the respondent confirmed the initial decision of August 2022. However, in the reasons for review decision more detail was provided. There was an acknowledgment that the contract nominated Austin Constructions Co as the builder but noted that the ABN of the company was included in the builder’s details on the contract. The decision-maker had regard to the statement by the builder that the company ABN was entered by mistake. Regard was also had to the fact that the company was named on the Home Warranty Insurance Notice of Cover. Other considerations were that invoices for the work were issued by the company[5] which is not disputed; Austin Construction Co had de-registered for GST on 1 February 2021 and that the company had undertaken one job in the 2020/2021 year for $319,999.00, the same contract price as the applicant’s job. All of this the respondent submits leads to the inference that the applicant’s contract was really with the company and not with Austin as a sole trader.
- [10]The applicants have filed an application to review that decision. The Tribunal’s function under s 20 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (“QCAT Act”) is to produce the correct and preferable decision.[6] In support of the application, the applicants, through their solicitors, have filed written submissions. The Commissioner has filed comprehensive submissions and relies on the documents filed under s 21 of the QCAT Act. It was conceded by both parties at the commencement of the hearing that there was no dispute of fact and the correct and preferable decision turns on whether the applicants contracted with Austin Construction, that is Mr Austin as a sole trader or with the company.
The issue in this application
- [11]The issue for consideration in this application was succinctly put by the decision maker in the reasons for decision at [9]:
If I accept that you contracted with the sole trader business, and not the company, then you are eligible for the grant as your builder will have complied with the builder licencing requirements. However, if my view is that you contracted with the company, then you will not be eligible as the company's QBCC building licence was not issued until 24 May 2021, which was later then the requisite 29 November 2020.
- [12]As it happened the Commissioner preferred the latter conclusion finding the contract was with the company.
- [13]The builder with whom the applicants contracted and named on the contract is Austin Construction Co, the registered business name under which Samuel Austin carries on business as a builder. The only entry in item 4 which might give rise to suspicion about the true legal identity of the builder is the ABN. An explanation for that entry has been provided by Mr Austin as follows:
In regards to the renovation project at …….[7] Manly West for Bradley Fleming and Georgia Simpson, the inclusion of the ABN and ACN for Austin Construction Co Pty Ltd was a clerical error. When the job was looked at and a contract negotiated I was operating as a sole trader and all the structural works were carried out by myself. The Builders licence number on the contract represents Sam Austin QBCC licence number 15032157).
There were delays in starting the job due to negotiations with the bank to approve the loan, and as a result we did not start for a further nine months. Prior to the job I started preparing to move from sole trader to a company (Austin Construction Co Pty Ltd) setting up the company and acquiring the ABN and ACN.
When using the HIA contracts portal there is an autofill function, it was not my intention to enter the company details but I have clearly clicked the wrong one.
- [14]There is simply no basis upon which the evidence from Mr Austin should not be accepted. It is entirely consistent with the search extracts from the ASIC and the QBCC. It also follows that he could not, at the relevant time, contract on behalf of the company because it was unlicensed. Yet despite it being plain on the face of the contract that the builder was the sole trader, Austin Construction Co, thereby identifying the legal entities to the contract, the Commissioner submits that the fact that Austin is named as the contracting party, should be ignored and instead it should be inferred that the contract was really with the company as the builder.
- [15]This application is not about how the builder chooses to conduct his construction business in performing the obligations under the contract. What the written contract provides, in summary, is that the builder named on the contract, Austin Construction Co (Samuel Austin) will carry out the construction works for the renovations, in accordance with the plans and specifications, ensure all regulatory requirements are complied with and hand over the works at practical completion. The obligation of the applicants under the contract is to pay the contract price and the cost of any variations.
- [16]The Commissioner, as noted above, raises a number of points as to why the contract was with the company rather than with Austin. I will address those points.
The ABN for the company
- [17]If it is accepted that the insertion of the company’s ABN by the self-populating format of the online contract prepared by Mr Austin was a mistake, which I find occurred, that would be the end of the matter. However, what is important from the applicant’s perspective, is not the ABN but the named identity of the builder. They were dealing with Mr Austin and understood that he would be the builder. There is no evidence that they were aware of the existence of the company at the time of the contract.
- [18]Even though the company ABN is noted in item 4 of schedule 1, it would not be reasonable to expect them to undertake searches of the ABN to ascertain the holder of that ABN. Similarly, for a lay person it is questionable as to whether they even knew what both the ABN and ACN acronyms stood for. Mr Fleming who attended the hearing confirmed they were dealing with Mr Austin.
- [19]I find that the reference to the company ABN on the contract does not lead to a compelling inference that the applicants contracted with the company.
De-registering for GST
- [20]As I have already indicated, the way in which Mr Austin chose to conduct his business post-contract is entirely a matter for him. There was no communication of a change in the nature of the legal entity of the builder to the applicants post contract and therefore as far as they were concerned their contract was, throughout, with Austin.
- [21]Once again, this is consistent with Mr Austin’s evidence that he was in the situation of transitional to a corporate entity to operate the business.
Home Warranty Insurance
- [22]The applicants paid the premium for the home warranty insurance under the contract. Although the original notice of cover stated that the company was the licensed builder, that was corrected later with the reissuing of the notice of cover in May 2023. The mistake was corrected to ensure that the works were covered under the scheme because the policy would not respond if the works were not carried out by a licensed builder. Again, I accept that this error occurred during the transition from sole trader to the company. The notice of cover states the commencement of the work was the date of the contract, 27 December 2020, when Mr Austin was operating as a sole trader.
- [23]The Commissioner contends that there is a compelling inference to be drawn that the applicants contracted with the company. But again, this flies in the face of what is recorded on the contract and the fact that the company could not legally operate the building business because it was not licensed. I don’t accept such an inference can be drawn.
Invoices issued by the company.
- [24]Work did not start until about 9 months after the contract date. This is explained by Mr Austin. In the applicants’ submissions, it is contended that once the company was licensed the works were assigned to the company. There is no evidence of a formal assignment, at least not within the knowledge of the applicants. But the question is, does it matter? There was no change in the contractual arrangement between the applicants and Mr Austin. Had, there been any default on the part of Austin then proceedings could have been instituted against Mr Austin under Uniform Civil Procedure Rule 89.
- [25]The fact that invoices issued by another entity for work undertaken by Austin do not translate to the original contract being with that entity, without some acknowledgement by the applicants to that effect.
- [26]Once again, I make the point that how Mr Austin chooses to conduct his business is solely a matter for him.
Discussion
- [27]The Commissioner maintains the position that when looked at objectively the only reasonable inference to draw from the established facts referred to above, all post the contract date,[8] is that when the parties intended to enter into the contract, it was really the company making the offer to the applicants and not Austin. The Commissioner’s case is that it is necessary to go behind the formalities of contract formation to identify the true parties to the contract in circumstances where the applicants knew nothing about the company. Although this may seem trite, it is worth noting in these circumstances that the formation of a contract has been described as:[9]
According to classical contract theory, the offer and acceptance formula identifies a “magic moment of formation” when the parties are ad idem (of one mind) and their individual wills come together to create binding obligations. In that moment, all of the parties contractual obligations spring into existence. The rules about offer and acceptance are based on the idea that until the moment of formation the parties are under no obligation to one another and free to withdraw from negotiations. Hugh Collins has observed that these rules typify the formalist qualities of classical law: they are detailed, technical and mysterious, yet claim logical derivation from the idea of agreement.
- [28]Applying that statement to these circumstances, a contract was formed between Austin as a sole trader and the applicants when signed by both parties, individually on 28 December 2020. Noting in particular, it was signed by Sam Austin “for and on behalf of Austin Construction Co”.
- [29]As to the necessity to draw an inference as to the legal identity of the builder, that may be appropriate where there is ambiguity in the contractual document about this. Here the only possible ambiguity is the ABN, but as to the actual name, or identity, of the party, there is none. This follows from what Bond J said in Inghams Enterprises Pty Ltd v Kim Yen Tat [2018] QCA 182 at [55] (‘Inghams Enterprises’):
The approach which must be taken to the process of inferential reasoning required in this case is clear: see per Gageler J in Henderson v State of Queensland (2014) 255 CLR 1 at [87]-[91] and Gordon J in Re Day (2017) 340 ALR 368 at [18], and the authorities which their Honours cite. Whether the subject of the inference is a particular fact, or the existence of a state of affairs:
...where direct proof is not available it is enough [if] the circumstances appearing in the evidence give rise to a reasonable and definite inference: they must do more than give rise to conflicting inferences of equal degrees of probability so that the choice between them is mere matter of conjecture ... But if circumstances are proved in which it is reasonable to find a balance of probabilities in favour of the conclusion sought then though the conclusion may fall short of certainty it is not to be regarded as a mere conjecture or surmise.
- [30]The relevant reference in the above passage is to the absence of direct proof before it is necessary to revert to inferences from established facts. What the Commissioner is contending for here is that despite the direct proof of the identity of the builder on the contractual document, including the signature of Mr Austin, it is necessary to look at the state of affairs, mainly post-contract, and then to infer by reference to facts of which the applicants know nothing about, substitute the identity of the builder that is named on the contract.
- [31]Both Austin and the applicants had rights and obligations under the contract. If either party defaulted, legal proceedings could be taken against the other. Hypothetically, if proceedings were taken by the applicants against Austin for breach, I doubt very much if a defence of “not me, my company”[10] would attract much traction in the face of the contractual document. Similarly, if proceedings were brought by the company against the applicants, there is every possibility it would be struck out on the grounds that the company had no cause of action against the applicants under the contract. In those circumstances, any attempt to contend that it should be inferred that the applicants contracted with the company in the face of the signed contract would be faced with difficulties.
- [32]It may, perhaps, be arguable that the ABN noted on the contract would provide some justification to infer that the company could be involved either as a plaintiff or defendant, but it is not persuasive. More importantly, as alluded to above in the passage from Inghams Enterprises, that would only arise where there is no direct proof available of the true contracting party.
- [33]I am not satisfied that Mr Austin was using the company vehicle as the builder at the time of entering into the contract. I find he contracted as a sole trader, particularly relying not only on the signed contract but also the statement he has provided to the Tribunal. I might also add that even if he did purposely include the company’s ABN, the outcome would be the same because the applicants signed a contract for Austin Construction Co to carry out the renovation work and not the ABN holder.
- [34]Therefore I have come to the conclusion that the correct and preferable decision is that the decision of the Commissioner be set aside and in lieu thereof that the applicants’ application for the HomeBuilder Grant be approved.
- [35]There will be orders accordingly.
Footnotes
[1] Exhibit 2 (s 21(2) documents filed by the respondent) pp. 60-62.
[2] Ibid, p. 45.
[3] Commissioner of State Revenue v Lewis [2024] QCATA 126.
[4] Exhibit 2 (s 21(2) documents filed by the respondent) p. 35.
[5] Ibid, pp. 156-160.
[6] QCAT Act, s 20.
[7] I have deleted the residential address for privacy reasons.
[8] Except for the date of the formation of the company.
[9] Andrew Robertson & Jeannie Paterson, Principles of Contract Law (Lawbook Co., 6th ed, 2020) [3.05].
[10] A common phase used where it is alleged a company (usually with no assets) is said to be the contracting party.