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Harper Property Builders Pty Ltd v Queensland Building and Construction Commission[2018] QCATA 70

Harper Property Builders Pty Ltd v Queensland Building and Construction Commission[2018] QCATA 70

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:

Harper Property Builders Pty Ltd v Queensland Building and Construction Commission [2018] QCATA 70

PARTIES:

HARPER PROPERTY BUILDERS PTY LTD

(applicant)

 

v

 

QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION

(respondent)

APPLICATION NO:

APL273-17

MATTER TYPE:

Appeals

DELIVERED ON:

25 May 2018

HEARING DATE:

20 February 2018

HEARD AT:

Brisbane

DECISION OF:

Hon J B Thomas, Judicial Member

Senior Member Brown

ORDERS:

  1. Leave is granted to the applicant to appeal against the decision in application GAR051-17 dated 21 July 2017.
  2. The Tribunal’s decision of 21 July 2017 is set aside and an order is substituted that time be extended for the commencement of the application for review to 3 March 2017.

CATCHWORDS:

APPEAL AND NEW TRIAL – APPEAL – GENERAL PRINCIPLES – RIGHT OF APPEAL – WHEN APPEAL LIES – FROM INTERLOCUTORY DECISIONS – LEAVE TO APPEAL – consideration of principles for granting leave to appeal from interlocutory decision – where appeal on question of law – application of s 146 Queensland Civil and Administrative Tribunal Act 2009 (Qld)

APPEAL AND NEW TRIAL – APPEAL – GENERAL PRINCIPLES – RIGHT OF APPEAL – WHEN APPEAL LIES – ERROR OF LAW – WHAT IS – GENERALLY – whether the Tribunal erred in law – whether the Tribunal erred on a question of mixed fact and law – whether there was an error of principle

APPEAL AND NEW TRIAL – APPEAL – GENERAL PRINCIPLES – INTERFERENCE WITH DISCRETION OF COURT BELOW – IN GENERAL – WRONG PRINCIPLE – PARTICULAR CASES – OTHER CASES – where applicant sought extension of time to seek review of decision by respondent regarding termination of building contract – where Tribunal failed to appreciate the substance of the applicant’s case – where Tribunal erred in finding that the applicant had no reasonable prospect of success in the substantive application – where Tribunal erred in placing undue weight on applicant’s explanation for delay in commencing review proceeding – where Tribunal erred in making findings of fact and in determining issues not before the Tribunal for decision – where error in judicial method – where error in exercise of discretion

Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc [1981] 148 CLR 170

Ericson v Queensland Building and Construction Commission [2014] QCA 297

Mace v Murray [1955] 92 CLR 370

Mirana Investments Pty Ltd & Ors v Coupe [2012] QCATA 187

Mitchamy Developments Pty Ltd v Morrison and Walsh [2010] QCATA 51

Norbis v Norbis [1986] 161 CLR 513

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 20, s 142, s 146, s 147

APPEARANCES & REPRESENTATION:

 

Applicant:

M Doyle of counsel, instructed by Crouch & Lyndon Lawyers

Respondent:

R M De Luchi of counsel, instructed by the Respondent

REASONS FOR DECISION

Proceedings and Jurisdiction

  1. [1]
    The applicant is a building company (‘the builder’) of which Mr Adrian Harper is the sole director.
  2. [2]
    On 22 December 2016 a decision by a Review Officer of the respondent Commission was notified to the builder, in the following terms:

…that the contract between the review applicant and the homeowners has been validly terminated by the homeowners, having the consequence of allowing a claim for non-completion under the Queensland Home Warranty Scheme.

  1. [3]
    This was a ‘reviewable decision’,[1] for which QCAT is the designated tribunal.[2]
  2. [4]
    The period prescribed for the commencement of such a review is 28 days.[3]
  3. [5]
    The builder's application for review was not lodged until 3 March 2017, which was approximately 6 weeks later than the prescribed time. The application was accordingly accompanied by an application for extension of time for its commencement.
  4. [6]
    Those applications were heard by an Acting Senior Member of QCAT, who dismissed the application to extend time. On the footing that the application to review could not now succeed, he also dismissed it.
  5. [7]
    Although the learned Member's reasons for judgment appear to contain actual findings that the builder committed substantial breaches of the contract and a conclusion that this gave the owners the right to terminate the contract,[4] the dismissal of the application for review was ultimately on the footing that because it was out of time it could not proceed. Both dismissals were in our view interlocutory, and the proceedings were never intended by the parties to be a hearing on the merits.
  6. [8]
    Section 142 (3) of the QCAT Act requires leave to appeal to be obtained for any ‘decision that is not the tribunal's final decision in a proceeding’. In our view neither of the dismissal orders was a ‘final decision’ within the definition of that term. It follows that leave needs to be obtained for the appeal to proceed. Further, to the extent to which the appeal involves any error of mixed fact and law, leave needs to be obtained under s 143(3)(b). It is not contested that the applicant needs to obtain this Appeal Tribunal's leave to proceed with the appeal.
  7. [9]
    In the event that the existing orders are set aside, the builder requests that this Tribunal order that the time be extended so that the principal application to review the Commissioner's decision can proceed in QCAT in the usual way.

Record of Proceedings before QCAT Member

  1. [10]
    It is necessary to identify the material that was placed before the learned Member.
  2. [11]
    In the original QCAT proceedings, directions were given that the application to extend time would be determined on the papers and without an oral hearing, based on the written submissions, unless otherwise ordered by the Tribunal and in the absence of a request for an oral hearing by either party.[5]
  3. [12]
    The applicant builder initially included some documents in the Appeal Book that had not been before the learned Member, and omitted to supply a bundle of documents that had been appended to the Commissioner's submissions to the learned Member. Subsequently an application was filed to enable the builder's additional material to be included in the determination of the appeal. That application was not ultimately pursued.
  4. [13]
    In the event, it is now accepted that all documents in the appeal book, except those under tabs 2.3, 2.6 and 2.8 are properly before this Tribunal, and that the appeal record is to be supplemented with the bundle of documents appended to the Commission's submissions to the learned Member, which of course also need to be before us.

Issues

  1. [14]
    The issues were not defined by any type of pleading. The only formal evidence presented by the builder was his affidavit dealing with the issue of delay in making the application. However, two schedules were attached to the application containing the grounds on which the application was based, and these included an assertion of ‘the relevant facts’.
  2. [15]
    The Commissioner then provided the learned Member with the above-mentioned bundle of documents annexed to its submissions.
  3. [16]
    The builder did not at that stage place any further material before the Tribunal for the purposes of the extension of time application. It was, however, indicated that the builder would have desired to present further evidence for the purposes of the review on the merits if the necessary time extension had been obtained.
  4. [17]
    The above directions authorised the making of a decision based upon a mixture of various documents and of assertions of fact contained in submissions.
  5. [18]
    The above material is that upon which the extension of time application was based, and upon which we must determine this appeal against its refusal.
  6. [19]
    The decision that is sought to be reviewed is an internal review decision of an earlier decision by a claims officer of the respondent Commission. It is clear from perusal of the two decisions by the Commission’s review officers that the rescission by the owners was upheld on the basis of a notice of intention to terminate dated 28 June 2016 and a termination notice of 19 July 2016, which were assessed to have been validly given under clauses 20 and 21 of the general conditions of the building contract.[6]
  7. [20]
    The issues raised by the applicant builder for our determination are stated as:[7]
    1. (a)
      Did the primary Tribunal err in law, or make an error of mixed fact and law, or fail to properly exercise its discretion, in dismissing the application for an extension of time?
    2. (b)
      Should leave be granted, pursuant to section 142(3)(a)(ii) of the QCAT Act to appeal the primary Tribunal’s decision dated 21 July 2017?
    3. (c)
      What is the appropriate relief?

Facts relied on by applicant for review

  1. [21]
    The sequence of events and facts relied on by the applicant builder are:
  1. On 8 October 2015, the applicant entered into a residential building contract (‘the Contract’) with David Holland and Melanie Holland (‘the Hollands’). Pursuant to the contract, the applicant agreed to undertake building work, including the raising, extending and renovation of the Hollands' residential house at 76 Sandgate Street, Sandgate.
  2. A dispute arose concerning the applicant's construction of screw pier foundations underneath the Hollands' house. On or about 8 June 2016, the Hollands provided the applicant with a report entitled ‘Structural Inspection Report', prepared by Morgan Consulting Engineers (‘the Morgan Report’).
  3. The Morgan Report identified that:
  1. ‘many of the steel columns’ attached to the existing house ‘do not line up with the concrete headstocks below’ (that is, they were offset); and
  2. ‘many of the steel columns terminate well above the tops of the concrete headstocks’ with the result that the ‘shafts of the connecting bolts between the headstocks and the steel columns are excessively long’.
  1. The Morgan Report went on to note that it was ‘relatively simple to rectify the defective fixing/connections’ but that ‘the eccentricity of the loading could cause undue bending stresses within the shaft of the screw pier’. Accordingly, the Morgan Report recommended the defective work be remedied (relevantly) by:
  1. obtaining advice from the screw pier designer / manufacturer / installer as to whether the observed offsets were permissible;
  2. (if the observed offsets were permissible) engaging an engineer to design extensions to each affected headstock; and
  3. (if the observed offsets were not permissible) engaging an engineer to design the necessary remedial works, such as additional footing beams or additional floor framing.
  1. On 15 June 2016, in accordance with the Morgan Report's recommendations, the applicant contacted (by telephone) the manufacturer of the screw piers, Kym Plotkin (Mr Plotkin) of Blade Pile. During that call:
  1. the applicant described the screw pier offset problem;
  2. Mr Plotkin confirmed that the offsets were not permissible and required additional remediation work (as opposed to extensions to each concrete headstock);
  3. the applicant advised that he proposed to engage a qualified engineer to design the necessary remedial work, and in particular to construct additional footing beams between the screw piers (as suggested in the Morgan Report); and
  4. Mr Plotkin confirmed remedial work of that nature, designed by a qualified engineer, would sufficiently rectify the defective screw pier foundations.
  1. Subsequently, on 27 June 2016, by email, the applicant sent Mr Plotkin a draft design of the additional footing beams. In his reply on the same day, Mr Plotkin said that:
  1. the proposed design was ‘more than adequate’ to secure the offset steel beams; and
  2. he had independently confirmed the adequacy of the additional footing beams from Structerre Consulting Engineers.
  1. On 28 June 2016, the Hollands' solicitors, Skelton Law, issued to the applicant a ‘Notice of Intention to Terminate Contract’. By the notice, it was alleged that specific screw pier concrete footings and the connections to the steel columns had not been installed by the applicant, inter alia, in an appropriate and skilful way, with reasonable care and skill, and in accordance with the plans and specifications in contravention of clause 10.1 of the Contract. Those specific concrete footings were identified as:
  1. photographs on pages 31 and 32 of the Pro-Check report; and
  2. photographs 3, 5, 6, 7, 8, 9, 10, 13 of the Morgan Report.

The notice identified no other defects or concrete footings, nor did it provide that all concrete footings required rectification.

  1. The notice advised the applicant it could remedy that breach (the offsetting of the specific screw pier concrete footings) by following the recommendations of the Morgan Report and was required to do so within ten (10) business days, failing which the Hollands intended to terminate the Contract.
  2. On 2 July 2016, the applicant engaged Mr Jayanta Bhattacharya of JP Engineers and Architects (Mr Bhattacharya) to design footing beams necessary to rectify the screw pier offset issue. On 2 and 3 July 2016 (by email), Mr Bhattacharya, a qualified engineer (Queensland Registration RPEQ17579), was provided with:
  1. several photographs of the specific offset screw piers at the Hollands' residence, which had been identified in the Morgan Report;
  2. a geotechnical soil testing report of the Hollands' residence, produced by Independent Soil Testing on 31 July 2015;
  3. the structural drawings for the building work, prepared by DEQ Engineering in September 2015, and the architectural drawings for the building work, prepared by Joe Evans Design & Drafting on about 3 September 2015; and
  4. draft designs of the proposed footing beams produced by the applicant (as provided to, and approved by, Mr Plotkin).
  1. On 7 July 2016, Mr Bhattacharya issued the applicant with:
  1. structural engineering drawings for the construction of the footing beams; and
  2. a ‘Form 15 - Compliance Certificate for Building Design or Specification’ in respect of the construction of the footing beams.
  1. Between 8 and 11 July 2016, the applicant prepared the necessary steel reinforcement for the footing beams in accordance with the structural engineering drawings prepared by Mr Bhattacharya.
  2. On 11 July 2017, prior to the pouring of concrete for the footing beams, at Mr Bhattacharya's request, the applicant provided photos of the completed steel reinforcement. After reviewing those photographs, Mr Bhattacharya approved the applicant's pouring concrete and completing the footing beams in accordance with his structural engineering drawings.
  3. Between 12 and 14 July 2016, the applicant poured the concrete and finalised footing beams with respect to the specific concrete footings identified by the Hollands. Mr Bhattacharya then issued a ‘Form 16 Inspection Certificate’ on 14 July 2016 certifying that seven specific footing beams had been carried out in accordance with his structural engineering drawings.
  4. On 15 July 2016, the applicant provided Mr Holland, Mr James Fenwick (Building Inspector, Resolution Services, with the Respondent) and Mr Les Kirby (Certifier, Catalyst Building Approvals) the following documents (by email at 5.08 pm):
  1. email correspondence between the applicant and Mr Plotkin;
  2. draft designs of the footing beams prepared by the applicant on 15 June 2016 provided to Mr Plotkin;
  3. the Form 15 and Form 16 issued by Mr Bhattacharya; and
  4. the structural engineering drawings for the footing beams produced by Mr Bhattacharya.
  1. The applicant received no response.
  2. On 19 July 2016, by way of a letter from Skelton Law, the Hollands purported to terminate the Contract on the grounds that the applicant had purportedly failed to perform the required rectification work.
  3. Following the purported termination, the Hollands re-took possession of their residence, ejected the applicant, and prevented the applicant from continuing to perform the Contract. Consequently, on 18 August 2016, the applicant, by way of a letter from its then solicitors, advised that the Hollands' conduct constituted a repudiation of the Contract which was accepted by the applicant.
  4. Prior to 1 September 2016, the Hollands made a complaint to the respondent concerning the applicant's building work under the Contract. On 1 September 2016, Ms Rachel Staff, a Claims Officer with the respondent, advised the applicant that the respondent decided the Contract had been validly terminated (the First Decision).
  5. The applicant applied for an internal review of the First Decision on or before 29 September 2016.
  6. On 22 December 2016, Mr Jonathan Pacey, a Senior Internal Review Officer with the respondent, advised that the respondent had decided, pursuant to s 86C of the Queensland Building and Construction Commission Act 1991 (Qld) that the Contract had been validly terminated by the applicant.[8]
  1. [22]
    The material explaining the delay showed that:
    1. Mr Harper is the sole director of the builder;
    2. The Commission’s decision was handed down on 22 December 2016;
    3. He had ‘wound down and ceased working’ for the Christmas holiday period on the day before;
    4. He was not aware of the significance of the time limit;
    5. He did not believe he would be able to get in contact with relevant subcontractors until after the New Year-Christmas holiday period, or with his solicitors. His solicitor’s office had in fact closed from 5.00pm Thursday 22 December 2016 until Monday 9 January 2017.
    6. He went on his prearranged holiday with his family to Bribie Island and recommenced work on 16 January 2017.
    7. On 18 January 2017, he was advised that the Commission had approved the sum of $200,000 for a claim against his company under the Queensland Home Warranty Scheme, upon which he telephoned the first review officer and obtained further information. He then telephoned his solicitors and made an appointment for 27 January 2017.  The appointment date (27 January 2017) was arranged so that he could collate information to provide to his solicitors.
    8. A further five weeks then elapsed before his solicitors filed the necessary application on 3 March 2017.
    9. The potential detriment to the builder flowing from the respondent's decision is a financial liability of $200,000.
    10. The respondent Commission was unable to show any relevant prejudice as a consequence of the delay of approximately 6 weeks for commencement of the review.

Discussion

  1. [23]
    Under section 20 of the QCAT Act, any review is to be conducted by way of a fresh hearing on the merits. The Tribunal’s eventual task would be to make ‘the correct and preferable decision’ on the merits upon whatever evidence the parties presented to QCAT upon the review.[9]
  2. [24]
    For the purposes of the learned Member's determination of the application for extension of time it was necessary for him to endeavour to make an assessment of the strength or weakness of the applicant’s case, but it was not his function to try that case on the merits.
  3. [25]
    The cases cited by the parties touching upon the proper exercise of a discretion to extend time include Baguley v Lifestyle homes Mackay Pty Ltd;[10] Braunberger v Assistant Commissioner Les Hopkins;[11] Crime and Misconduct Commission v Chapman;[12] and Cardillo v Queensland Building Services Authority.[13]
  4. [26]
    Whilst recognising that the discretion to extend time is unfettered (except to the extent that s 61 of the QCAT Act precludes such an extension when it would cause prejudice or detriment, that could not be remedied by an appropriate order for costs or damages), the following matters have been recognised in the above cases as particularly relevant considerations in such exercises:
    1. the length of the delay;
    2. the adequacy of explanation for the delay;
    3. the merits of the proceeding sought to be litigated;
    4. prejudice to others; and
    5. the interests of justice (sometimes expressed as ‘general considerations of fairness’).
  5. [27]
    In the context of extending time for an appeal or review, commonly the central question addressed is whether there is any reasonable prospect of success in the proposed appeal.[14]
  6. [28]
    Before discussing the substance of the application for leave and of the appeal, two propositions in the written submissions on behalf of the builder need to be mentioned. These were not specifically asserted by Mr Doyle on behalf of the builder, but neither were they abandoned.

Reasonable explanation of delay not a pre-requisite

  1. [29]
    First, it was submitted that the learned Member ‘erred in finding that …a reasonable explanation for the delay was a prerequisite to the exercise of discretion...’[15] Had the Member so found or so directed himself, that would have constituted an error. However, we do not consider that any such error was made. Paragraphs [68] and [69] of the learned Member's Reasons for Judgment indicate that the factor of explanation of the delay was considered in combination with other major factors in the case.

No ‘correct’ level of merit necessary

  1. [30]
    The second proposition was that the learned Member failed to apply the correct test in considering the level of the applicant's prospect of success. The ‘correct test’ to be applied by the Member was said to have required only a ‘low threshold’. The submission proceeded that the learned Member ‘erred in law in considering the test to be whether the applicant had any reasonable prospects of success (a higher threshold)’.
  2. [31]
    Cases were cited in which judicial officers or tribunal members have commented in particular cases that ‘without looking too closely to the merits' there was ‘at least an arguable case’;[16] or that it would be sufficient if a quite low threshold were met, such as if the applicant ‘demonstrated that there is an arguable case, or at least that the grounds for review are not hopeless’;[17] or whether the prospects of overturning the decision were ‘slim’.[18]
  3. [32]
    However, the entire notion that there is any particular threshold, whether low or high, that is requisite for the determination of this factor, is fallacious. In each case the tribunal's task is simply to do the best it can to derive an impression of the strength or weakness of the foreshadowed case, and then to consider that factor along with other recognised factors.
  4. [33]
    Cases may be found containing a wide range of epithets of evaluation of a foreshadowed case. They range through ‘strong’, ‘weak’, ‘slim’, ‘arguable’, ‘unarguable’, ‘unpromising’, ‘hopeless’ and many others.
  5. [34]
    Whatever the rating or description, this factor is then thrown into the crucible with the other recognised considerations. The discretion is exercised according to their combination. A ‘slim’ case might be allowed to proceed if the other factors sufficiently favoured the time being extended. Conversely, a very strong case with every chance of succeeding might fail to obtain the necessary extension if other factors such as inexcusable delay and irremediable prejudice to others militated sufficiently against it.
  6. [35]
    That submission must therefore be rejected.
  7. [36]
    The arguability of the builder’s case was necessarily a major factor in this particular application.
  8. [37]
    It is therefore desirable at this point to analyse the material and consider point one of the builder’s counsel’s submissions to us, namely that the learned Member erred by failing to properly consider the builder's case.

Failure to consider the applicant’s contentions re entitlement to terminate

  1. [38]
    The material before the learned Member was reasonably capable of supporting the following view of the facts.
  2. [39]
    On 28 June 2016, the Hollands gave the builder a ‘notice of termination’ under clause 20 of the building contract.[19] That clause gave the Hollands a defined contractual right to terminate the contract in the event that the builder failed to remedy a specified ‘substantial breach’ within the stated time of 10 business days.
  3. [40]
    The notice identified one ‘substantial breach’ and demanded that it be rectified within 10 business days, that is to say, by 12 July 2016.
  4. [41]
    The work to be rectified was described as ‘the Screw Pile Pad Footings and the connections to the SHS columns they are intended to support’. The notice purported to identify them by reference to a job drawing and photographs contained in 2 named engineering reports, but as will be seen, the particular piers requiring rectification were and are difficult to identify.
  5. [42]
    It may on some future occasion become necessary to identify whether at law the builder's overall performance was such as to entitle the Hollands to terminate the contract for serious breach by the builder. But the Commission's determination which is now sought to be reviewed by the builder is clearly based solely on the owners' special contractual right of rescission under clauses 20-21 of the building contract.[20]
  6. [43]
    The work undertaken by the builder included the lifting and restumping of the Hollands’ house. Prior to the work commencing, a footing and slab plan was prepared by DEQ Consulting Engineers (‘DEQ’). The plan identifies the required location of a number of concrete pad footings. The concrete pad footings were located at the base of the piers supporting the house. Into each concrete pad there was required to be inserted a structural steel tube described in the footing and slab plan as an ‘SHS post’. DEQ also prepared design drawings in respect of the concrete pad footings and the piers.
  7. [44]
    Attached to the Morgan Report are a number of photographs of the stumps constructed by the builder. Under the heading ‘2.2 New Stumps’, it is noted:

Many of the steel columns terminate well above the tops of the concrete head stocks and the shafts of the connecting bolts between the head stocks and the steel columns are excessively long (Photographs 2 to 13).

  1. [45]
    In section ‘3.0 Conclusions’ of the Morgan Report, it is noted:

Approximately one quarter of the steel/columns stumps supporting this residence do not line up with the centre of the screw pier headstocks.

…

In this case there are a large number of screw piers that do not line up with the steel columns they were to support. While it is relatively simple to rectify the defective fixing/connections between the base plates of the existing steel columns and the headstocks of the screw piers, the eccentricity of the loading could cause undue bending stresses within the shaft of the screw pier. Therefore it is recommended that the builder obtain advice from the designer/manufacturer/installer of the screw piers as to the extent of load offset that these piers can tolerate.

  1. [46]
    The Report contains a number of recommendations:[21]
  • Obtain advice from the screw pier designer/manufacturer/installer as to whether the observed offsets are permissible.
  • If the observed offsets are permissible then engage an engineer to design extensions to each affected headstock.
  • If the observed offsets are not permissible then engage an engineer to design the necessary remedial works, such as additional footings beams or additional floor framing.
  1. [47]
    The Morgan Report does not identify the exact number or location of the stumps the subject of the recommended further work other than by a general reference to photographs of a number of screw piers and steel columns appended to the Report.[22] A close examination of the photographs appears to reveal seven (7) footings and piers.
  2. [48]
    Prior to obtaining the Morgan Report, the Hollands commissioned a building inspection report prepared by Pro-Check (‘the Pro-Check Report’). The Pro-Check Report was before the learned Member. The Report refers to the footings and stumps in the following terms:

8.2 Footings and Stumps

Defective work. Refer the offset stumps to a structural engineer for a full building survey.

Action required.

Major defect and defective work.

The stumps are being supported on threaded rods that have not been installed over the centre of the concrete pads.

This may have a significant impact on the structural adequacy of the two storey building not having adequate support on the footings.

The contracted engineer shall inspect and advise on the suitability of purpose of the setup, with special consideration for site safety.

Defective work. Poor stump packers were noted, with the bearer bolts too close to the edge of the timber to be effective.

Any stump that has settled more than 55mm must be replaced. Softwood packers must be used irrespective of whether the stumps are timber, concrete or steel.

Packers must be corrosive resistant, incompressible, and cover the whole area of support.

In new work packing under timber bearers is defective if it is non durable, compressible, or does not provide the minimum bearing area as required by AS 1684, and in accordance with the QBCC Standards and Tolerances Guide 4.05.

Refer to the engineer for an assessment.

  1. [49]
    The Pro-Check Report contains two photographs of footings and stumps on which four stumps are identified and circled in red.[23] It is not possible to ascertain from the photographs whether these stumps are the same as those identified in the Morgan Report.
  2. [50]
    The notice of intention to terminate the contract given by the Hollands refers to the failure by the builder to install the screw pile pad footings and their connections to the SHS columns appropriately and in accordance with the plans and specifications. The notice refers to the screw pad pile footings as not having been installed in accordance with Job No. 15.3358 Drawing No. G06. This is a reference to the DEQ engineering drawing of the screw pile pad footing design. Of significance in the present dispute, the notice refers to the defective screw pile pad footings as:

… identified as follows:

  1. Photographs on page 31 and 32 of the Pro-Check report; and
  2. Photographs 3, 5, 6, 7, 8, 9, 10, 13 of the Structural Inspection Report of Morgan Consulting Engineer.
  1. [51]
    The evidence before the learned Member was that, after receiving the notice of intention to terminate, the builder engaged Mr Bhattacharya to design footing beams and other remedial work necessary to rectify the screw pier offset issue identified in the Morgan Report.[24] Mr Bhattacharya does not appear to have conducted an inspection of the site before undertaking the preparation of the engineering footing design.[25] A Structural Engineering Drawing and a Form 15 dated 6 July 2016 was provided by Mr Bhattacharya to the builder.[26]
  2. [52]
    The Form 15 was before the learned Member.[27] The Form 15 refers to relevant engineering drawings. Drawing ST-02 is a foundation layout plan identifying the location of pad footings and connecting concrete beams.[28] The Form 15 refers to:

Concrete Piers & Stumps are already existing on site and are NOT COVERED by this certificate.

  1. [53]
    The evidence before the learned Member was that the builder performed remedial building work between 12 July 2016 and 14 July 2016.[29] The evidence was that on 14 July 2016, Mr Bhattacharya issued a Form 16 Inspection Certificate in which he certified the remedial building work performed by the builder:[30]

… as attached by red mark-ups connected between Stumps/Posts has been certified by me.

  1. [54]
    Attached to the Form 16 was a copy of engineering drawing ST-02 on which eight (8) concrete piers connecting seven (7) pad footings were highlighted.[31] The Form 15 and the Form 16, together with the communication from the manufacturer of the screw pier to the builder, were provided by the builder to the Hollands on 15 July 2016.[32]
  2. [55]
    The builder’s case is that the remedial work undertaken by him after the notice of intention to terminate was given was limited to the specific matters identified in the notice. As we have noted, the Morgan Report refers to ‘approximately one quarter’ of the steel/columns stumps supporting the residence not lining up with the centre of the screw pier headstocks. The footings and slab plan prepared by DEQ Consulting Engineers identifies approximately thirty pad footings.[33] One quarter of this number amounts to seven or possibly eight pad footings. This accords with the works highlighted on engineering drawing ST-02 attached to the Form 16 by Mr Bhattacharya. It was in respect of these columns and piers that the builder says he undertook the remedial work as required by the notice of intention to terminate.
  3. [56]
    After the Hollands purported to terminate the contract, two further engineering reports were prepared, one by Booth Engineers & Associates Pty Ltd,[34] the other by Cornell Engineers. These reports were before the learned Member.
  4. [57]
    The Booth report was prepared following an inspection of the dwelling on 24 August 2016 by which date the builder had left the site.
  5. [58]
    The Booth report notes:[35]

Based on our site observations and the Form 16 inspection certificate issued, only a small portion of proposed footing beams appears to have been installed, contrary to the original design. This office was also advised by the owners that the inspecting engineer issuing the Form 16 does not appear to have visited the site and may have issued his certificate based on photographs rather than site inspections. Regardless, the design was not completed, leaving inadequate site drainage and inadequate building details in place.

  1. [59]
    The report goes on:[36]

Photos taken during our inspection confirm that numerous posts are still eccentric to screw caps with inadequate details, also much too high above the screw pier caps and filled excessively and in a non tradesperson like fashion. The standard of workmanship is grossly inadequate and the details do not comply with engineering designs for the property.

  1. [60]
    The Cornell report was prepared following an inspection on 22 September 2016 and notes:[37]

The steel SHS posts have not been constructed on the centreline of the screw pier pile caps. The steel posts have been installed too short and grout under the plates is excessive and has slumped providing inadequate support to the posts…

…

Rectification work has already been attempted by installing strip footings between some pile caps. However the as-constructed beams are inadequate in that they have not been installed throughout the entire building and have not addressed the issue of the incorrectly positioned base plates.

  1. [61]
    The Cornell report goes on to recommend specified rectification work and notes:

Where grout has not yet been provided under the baseplate of some SHS steel posts, this incomplete work will also be rectified by the above scope of works.

  1. [62]
    The learned Member found:[38]

The unanimous opinion of all three engineers who have reported on the work is that the posts were not installed in a proper and workmanlike way. Their opinions are consistent and unequivocal.

  1. [63]
    It is unclear to which three engineers the learned Member was referring although he makes various references in the reasons to the Booth report, the Cornell report, the Morgan Report and the Pro Check Report.[39]
  2. [64]
    It is necessary to make some observations about the Booth report and the Cornell report.
  3. [65]
    As we have observed, both reports were prepared following inspections of the building works after the builder had left the site. The Booth report refers to the installation of concrete beams, ‘contrary to the original design’. The original design, prepared by DEQ, was clearly quite different to the further design prepared by Mr Bhattacharya. Whilst the Booth report does not make clear what ‘original design’ is being referred to, it is assumed to be a reference to the design by Mr Bhattacharya as the (earlier) DEQ design does not contain the extensive array of connecting concrete beams identified in Mr Bhattacharya’s proposed foundation layout plan. 
  4. [66]
    The Booth report is critical of the remedial work undertaken by the builder as being limited to the installation of only a ‘small portion’ of the connecting concrete beams. But this is consistent with the builder’s case that he undertook remedial work in response to those matters identified in the notice of intention to terminate and in accordance with the design prepared and certified by Mr Bhattacharya. It is unclear to which ‘numerous posts remaining eccentric to screw caps’ the Booth report is referring but again, the fact that there were posts in relation to which remedial work had not been undertaken is consistent with the builder’s case that the remedial work was limited to those matters identified in the notice of intention to terminate. 
  5. [67]
    The Booth report is also critical of works in respect of ‘numerous posts’ for a variety of identified reasons. Again, the report does not identify which posts are being referred to nor does the report identify in what respects the work is said not to comply with engineering designs and whether these complaints relate to the actual remedial work undertaken by the builder or relate to remedial work required to be undertaken, but which the builder had not undertaken, before being excluded from the site.
  6. [68]
    The Cornell report is critical of the fill under some posts referring to the grouting as having ‘slumped’ and being ‘loose and unprofessional’. It is not apparent from the report that the author had reference to the engineering drawings and certification prepared by Mr Bhattacharya. There is nothing in the report to suggest that consideration was given to the engineered, and certified, solution to the issue with the piers. The Cornell report is critical of the remedial works in the form of the concrete beams between the pile caps, noting that the beams had not been installed throughout the entire building and had not addressed the issue of the incorrectly positioned base plates. As to the first issue, and as we have observed, the builder’s case is that the remedial work undertaken addressed only those matters identified in the notice of intention to terminate. As to the second issue, it is unclear from the report whether it is opined that the fact the beams had not been installed throughout meant that the issue of the incorrectly positioned base plates had not been addressed or whether the installation of the beams would not, in any event, address the issue of the positioning of the base plates.
  7. [69]
    In short, the builder's case is that the relevant notice (form 15) specified a considerably narrower area of defect than the defects that are mentioned in the subsequent reports which are relied on as establishing his non-compliance with the notice. It is also that the seven or eight mal-aligned stumps mentioned in the report mentioned in the termination notice were duly remedied and certified by the Bhattacharya inspection certificate.
  8. [70]
    These contentions seem to us to be clearly arguable.
  9. [71]
    We therefore consider that the learned Member's strongly expressed findings, including an ultimate finding that the builder committed substantial breaches of the contract which gave the owners the right to terminate the contract,[40] reveals a failure to appreciate the substance of the applicant’s arguable case. This constitutes an error of law.
  10. [72]
    The conclusion that the builder had no reasonable prospect of success on review was not reasonably open. This also constituted an error of law.

Explanation of Delay

  1. [73]
    The delay was fairly short (6 weeks and one day). It was credibly explained.
  2. [74]
    The potential detriment to the builder was obvious, while the Commission was unable to suggest any relevant prejudice on its part on account of it.
  3. [75]
    Without implying that the builder was faultless over the relevant period, some of the delay is readily understandable from the fact that the Commissioner’s decision in a proceeding conducted in September 2016 was given on 22 December 2016, immediately before the Christmas period, and from the fact that the latter part of the delay occurred after the matter had been placed in the hands of the builder’s solicitors.
  4. [76]
    The most that can be said was that there was some slackness in the builder’s conduct.
  5. [77]
    In these circumstances it is a little surprising that the learned Member’s reasons for judgment contained statements such as:[41]

…if Mr Harper had made a prompt inquiry of his solicitor’s office when he received the notice on 22 December 2016, he would almost certainly have been advised, if not in person, then very likely via telephone answering message which is a standard practice, that the solicitor’s office was closed from that day, only until 9 January 2017.

…

I do not accept that the builder has shown that the holiday period did in fact impede his ability to obtain legal advice and to pursue a review within time.

…

Once Mr Harper did contact his solicitor’s office, a further nine days passed until he had an appointment with his solicitor.  Mr Harper’s explanation that he needed to prepare materials to confer with his solicitor is unconvincing, as he had notice of the decision for all most a month by that time, and could have been preparing materials in that time.

  1. [78]
    On that basis, the learned Member indicated that he was not satisfied that the builder had demonstrated proper diligence in seeking to arrange for a review of the decision, or that he had given a reasonable explanation of the delay.
  2. [79]
    It is difficult to resist the conclusion that excessive adverse weight was accorded to this factor.

Member's Determination of Facts

  1. [80]
    It was submitted for the builder that the learned Member approached his task as if he were deciding the case on the merits, despite the preliminary interlocutory nature of the application. This, it was said, resulted in a failure of natural justice.
  2. [81]
    A significant part of the learned Member’s reasons for judgment consists of actual findings of fact and of final conclusions upon the evidence.
  3. [82]
    The following paragraphs in the reasons for judgment are sufficient to demonstrate this:[42]

[51]  The attempted rectification by the builder, by constructing concrete bond beams between the pads, was wholly unsatisfactory and ineffective. Again, it is apparent that the bond beams have been done in a poor and amateurish manner, and the evidence is that the beams were not completed between all posts.

…

[58] The stumping works were not carried in an appropriate and skilful way, and with reasonable care and skill, as noted by the engineers. This constituted a substantial breach of the contract.

…

[60] I do not accept that suggestion. The progress of the works should have been significantly and adversely affected by the need to rectify the stumps. The stumping works are of core structural significance. No further works should have been conducted whilst the building was in an unsecured and potentially dangerous state, with the risk of damage occurring to further new work which was being performed. A major structural defect such as the stumps should have been addressed as soon as possible, and before further work was conducted.

[61] I consider that the failure to rectify the defective stumps, once the defects were identified, was a substantial breach of the contract. The substantial breaches of the Contract gave the owners the right to terminate the Contract.

[62] I consider that the owners were justified in terminating the Contract on 19 July 2016. I agree with the opinion of Mr Pacey that the Contract was properly terminated. I do not consider that the application to review by the builder has any reasonable prospect of success.

  1. [83]
    We are conscious that, in discussing the possible strength of a case, it may happen that the judgment-writer strays into language that resembles the actual trying of the case.  However, the making of actual findings of fact and the reaching of apparently final conclusions such as those expressed in the above paragraphs suggests that the learned Member did indeed approach the task as a fact-finder and that he tried issues that were not before him for decision.
  2. [84]
    We have also considered the possibility that such an approach simply reflects an over-zealous attempt to reach a view on the merits of the builder's case. But it is inescapable that the judgment goes beyond mere looseness of expression and reveals error in method. More importantly, for reasons earlier stated, the learned Member's factual analysis in the end reveals a failure to understand the substance of the builder's case.
  3. [85]
    In addition, there was an error in judicial method which should be characterised as an error of law. The issue to be addressed is the degree of arguability of the case, not a determination of the facts. This was therefore an error of principle.
  4. [86]
    The builder contended that this approach also resulted in a failure of natural justice, as the interlocutory application was dealt with as if it were the hearing, and without notification to the parties that the matter would be dealt with in this way. The builder submits that this unfairly deprived him of the ability to put forward the material upon which he might have relied in any substantive application and it unfairly deprived him of the ability to request an oral hearing with cross-examination in order to test expert and lay evidence.
  5. [87]
    Minds may differ as to whether this was also an over-reach of function which resulted in a failure of natural justice. It is, however, unnecessary to determine that point.  It is enough to indicate that the learned Member’s findings and approach to the task of assessing the strength of the foreshadowed case reveals errors of law in a critical component of the judgment. These are of sufficient moment to require the decision to be set aside.

Nature of appeal

  1. [88]
    Although counsel for the builder submitted that the appeal raised both questions of law and of mixed law and fact, no specific question of mixed law and fact was articulated.
  2. [89]
    Subject to leave being granted, it is necessary to consider whether the present appeal would fall under section 146 or 147 of the QCAT Act.[43]
  3. [90]
    In the forgoing discussion, the identified errors are errors of law.
  4. [91]
    The facts of what might be termed ‘the building case’ were not before the Tribunal for determination. The relevant function of the Tribunal in relation to this was to endeavour to assess its arguability, or to rate its strength.
  5. [92]
    Any error in determination of the level of arguability or in assessment of the relative strength of the case was an error of law.
  6. [93]
    For the purposes of disposition of this appeal, it is not necessary to rely upon any point that can be characterised as a question of fact or of mixed law and fact.
  7. [94]
    To the extent that the learned Member may have erred in giving too much weight to such delay as did occur, this would also be an error of law.
  8. [95]
    Accordingly, we consider that the appeal falls to be decided under section 146.
  9. [96]
    As this appeal is confined to the material before the primary Tribunal, and as it can be decided upon errors of law, it is to be regarded as an appeal in the strict sense.

Appeal against exercise of discretion

  1. [97]
    The principles applicable in an appeal against the exercise of a judicial discretion have been recognised in many cases.[44]
  2. [98]
    It is sufficient for present purposes to say that in an appeal against the exercise of a discretion an appellant Tribunal does not simply substitute the view that it would have taken if it had been in the place of the primary Tribunal.  It will not interfere unless it reaches a clear conclusion that there has been some error of fact or law, and that the discretion has not been properly exercised.  It is usually necessary to show that the primary Tribunal has acted on a wrong principle, or has been guided by extraneous or irrelevant matters; or mistaken the facts, or failed to take into account some material consideration, or that some error must be inferred because of the result is plainly unjust or unreasonable.[45]

Leave to appeal

  1. [99]
    The principles upon which leave to appeal maybe granted are compendiously stated by Wilson J in Mitchamy Developments Pty Ltd v Morrison and Walsh as follows:[46]

The question whether or not leave to appeal should be granted is usually addressed according to established principles: is there a reasonably arguable case of error in the primary decision? Is there a reasonable prospect that the applicant will obtain substantive relief? Is leave necessary to correct a substantial injustice to the applicant caused by some error? Is there a question of general importance upon which further argument, and a decision of the Appellate Court or Tribunal, would be to the public advantage?

  1. [100]
    Leave to appeal should be granted in this matter because there is a reasonably arguable case of error in the primary decision,and it is in the overall interests of justice that the builder be afforded the opportunity to proceed with a review on the merits of the Commissioner’s determination.

Summary

  1. [101]
    In summary, we think that the proceedings in the Tribunal miscarried in a number of respects.
  2. [102]
    The forgoing discussion reveals the following errors:
    1. (a)
      A failure to appreciate the substance of the applicant’s contentions as to entitlement to terminate;
    2. (b)
      A failure to conclude that a reasonably arguable case was shown;
    3. (c)
      The undertaking of a determination on the merits instead of assessing the relative strength of the builders foreshadowed case;
    4. (d)
      Attribution of excessive weight to the factor of delay; and
    5. (e)
      Given that a reasonably arguable case was disclosed, that the delay was minor, and that no prejudice was shown by the Commissioner, error must be inferred in the learned Member's determination that time should not be extended.
  3. [103]
    It will be necessary to set aside the dismissal of the application to extend time. In our view, the correct decision in the present circumstances is to extend the time for the commencement of the review.

Orders

  1. [104]
    The following orders will be made:
    1. (a)
      Leave is granted to the applicant to appeal against the decision in application GAR051-17 dated 21 July 2017; and
    2. (b)
      The Tribunal’s decision of 21 July 2017 is set aside and an order is substituted that time be extended for the commencement of the application for review to 3 March 2017.

Footnotes

[1]           Queensland Building and Construction Commission Act 1991 Qld (‘the QBCC Act’), s 86(1)(i).

[2]           QBCC Act, s 87.

[3]           Queensland Civil and Administrative Tribunal Act 2009 Qld (‘the QCAT Act’), s 33(3).

[4]           Reasons for Judgment dated 21 July 2017, [61].

[5]  Directions made 18 May 2017.

[6]   Appeal Book, p 202.

[7]  Applicant's outline of submissions filed 6 October 2017, [4].

[8]  Applicant’s outline of submissions filed 6 October 2017, [5]-[24]; compare schedule 2 attached to Application to review a decision filed 3 March 2017, [1]-[27].

[9]  QCAT Act, s 20.

[10]  [2015] QCA 75.

[11]  [2014] QCATA 320.

[12]  [2011] QCAT 229.

[13]  [2011] QCAT 574.

[14]  Compare Harvey v Queensland Police Service [2018] QCA 64, [21], [22], [24], where the Court of Appeal’s conclusions concerning the three cases under appeal were respectively ‘no real prospects of success in the appeal’, ‘no reasonable prospect on appeal’ and ‘no prospects of success on the appeal’.

[15]  Applicant’s outline of submissions filed 6 October 2017, 1(a)(ii).

[16] John Gordon Tilley v Egan [2000] QCA 98.

[17] Gardener v Chief Executive Office of Liquor and Gaming Regulation [2011] QCAT 542, [40]-[41].

[18] Eastern Leader Co Pty Ltd v Department of Agriculture Fisheries and Forestry [2013] QCAT 463, [30].

[19]           Appeal Book filed 10 October 2017, p 109-111.

[20]           Ibid.

[21]  Respondent’s submissions filed 4 May 2017, Morgan Report at section 4.0.

[22]  Ibid, photographs 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13.

[23]  Respondent’s submissions filed 4 May 2017, Pro-Check Report, p 31 - 32.

[24]  Appeal Book, p 175 – 177, p 223.

[25]  Appeal Book, p 177.

[26]  Appeal Book, p 175.

[27]  Appeal Book, p 173 – 174.

[28]  Appeal Book, p 172.

[29]  Appeal Book, p 224.

[30]  Appeal Book, p 184.

[31]  Appeal Book, p 186.

[32]  Appeal Book, p 224.

[33]  Appeal Book, p 160.

[34]  Dated 29 August 2016.

[35]  Respondent’s submissions in GAR051-17 filed 4 May 2017, p 203.

[36]  Ibid.

[37]  Ibid, p 206.

[38]  Member’s reasons for judgment in GAR051-17, dated 21 July 2017, [50].

[39]  Ibid, [28], [29], [40], [41], [43].

[40]  Ibid, [61].

[41]  Ibid, [65], [63], [67].

[42]  Ibid, [51], [58], [60], [61], [62].

[43] Ericson v Queensland Building and Construction Commission [2014] QCA 297.

[44] Mace v Murray [1955] 92 CLR 370, 378-379; Norbis v Norbis [1986] 161 CLR 513, 518, 520; Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc [1981] 148 CLR 170, 176-177; Compare Mirana Investments Pty Ltd & Ors v Coupe [2012] QCATA 187, [27]-[34].

[45]  Ibid.

[46]  [2010] QCATA 51 at [19].

Close

Editorial Notes

  • Published Case Name:

    Harper Property Builders Pty Ltd v Queensland Building and Construction Commission

  • Shortened Case Name:

    Harper Property Builders Pty Ltd v Queensland Building and Construction Commission

  • MNC:

    [2018] QCATA 70

  • Court:

    QCATA

  • Judge(s):

    Judicial Member Thomas, Senior Member Brown

  • Date:

    25 May 2018

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
Adam P Brown Male Fashions Proprietary Limited v Phillip Morris Incorporated (1981) 148 C.L.R 170
2 citations
Jump To
Cite 1 - (1981) 148 C.L.R 170
Cite 2 - (1981) 148 C.L.R 170
Baguley v Lifestyle Homes Mackay Pty Ltd [2015] QCA 75
1 citation
Jump To
Cite 1 - [2015] QCA 75
Braunberger v Assistant Commissioner Les Hopkins [2014] QCATA 320
1 citation
Jump To
Cite 1 - [2014] QCATA 320
Cardillo v Queensland Building Services Authority [2011] QCAT 574
1 citation
Jump To
Cite 1 - [2011] QCAT 574
Crime and Misconduct Commission v Chapman & Anor [2011] QCAT 229
1 citation
Jump To
Cite 1 - [2011] QCAT 229
Eastern Leader Co Pty Ltd v Department of Agriculture, Fisheries & Forestry [2013] QCAT 463
1 citation
Jump To
Cite 1 - [2013] QCAT 463
Ericson v Queensland Building and Construction Commission [2014] QCA 297
2 citations
Jump To
Cite 1 - [2014] QCA 297
Cite 2 - [2014] QCA 297
Gardener and Ors v Chief Executive, Office of Liquor & Gaming Regulation and Anor [2011] QCAT 542
1 citation
Jump To
Cite 1 - [2011] QCAT 542
Harvey v Queensland Police Service [2018] QCA 64
1 citation
Jump To
Cite 1 - [2018] QCA 64
Mace v Murray (1955) 92 CLR 370
2 citations
Jump To
Cite 1 - (1955) 92 CLR 370
Cite 2 - (1955) 92 CLR 370
Mirana Investments Pty Ltd and Ors v Coupe [2012] QCATA 187
2 citations
Jump To
Cite 1 - [2012] QCATA 187
Cite 2 - [2012] QCATA 187
Mitchamy Developments Pty Ltd v Morrison & Walsh [2010] QCATA 51
2 citations
Jump To
Cite 1 - [2010] QCATA 51
Cite 2 - [2010] QCATA 51
Norbis v Norbis (1986) 161 C.L.R., 513
2 citations
Jump To
Cite 1 - (1986) 161 C.L.R., 513
Cite 2 - (1986) 161 C.L.R., 513
Tilley & Ors v Egan [2000] QCA 98
1 citation
Jump To
Cite 1 - [2000] QCA 98

Cases Citing

Case NameFull CitationFrequency
Bourne v Queensland Police Service – Weapons Licensing [2023] QCATA 73 citations
Brici v Parry [2019] QCATA 1342 citations
BTG [2025] QCAT 2732 citations
DCN v Scheme Manager, Victim Assist Queensland, Department of Justice and Attorney-General [2022] QCAT 3602 citations
De Francesco v Arthur [2023] QCATA 1341 citation
Ferizovic v Brisbane City Council [2021] QCAT 1671 citation
Francis v Queensland Building and Construction Commission [2024] QCAT 3602 citations
Gillham v Kernohan Construction Pty Ltd [2023] QCATA 643 citations
Hronis v Body Corporate for Malibu CTS 22174 [2022] QCATA 1872 citations
Jones v McNab [2019] QCAT 2132 citations
Lopez v Presbyterian and Methodist Schools Association [2022] QCATA 1622 citations
Mehalski v Gladstone Regional Council [2022] QCAT 2232 citations
Monsour v C & R Darvill Pty Ltd [2024] QCATA 1032 citations
Musgrave v Grimberg [2019] QCATA 1062 citations
Pollard v Fitzgibbon [2019] QCATA 422 citations
Prospero v Carney [2019] QCATA 1522 citations
Ramm v Ramm (No. 2) [2020] QCAT 2362 citations
Starr v Queensland Police Service – Weapons Licensing [2024] QCATA 1252 citations
Valuers Registration Board of Queensland v Murphy [2020] QCATA 1386 citations
1

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