Lohmann v Jaques[2021] QCATA 28

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

REASONS FOR DECISION

1. [1]
   Mr and Mrs Lohmann own a house in Charters Towers.  Mr Jaques is a builder who did work on that house in 2016 and 2017.  A dispute arose between them, and on 20 September 2017 the builder filed a claim in the Tribunal for $39,310.79 alleged to be owing by the owners for the work done.  The owners disputed this claim, and cross claimed for $12,567.70.  There was a hearing before a member of the Tribunal on 14 September in Townsville and 19 November 2018, and judgment was given on 26 August 2019, that the owners pay the builder $6,141.63. 
2. [2]
   Each side has appealed to the Appeal Tribunal from that judgment.  Under the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (“the QCAT Act”) s 142, each side has a right of appeal, but so far as the appeal is on a question of fact, or on a question of mixed law and fact, such appeal may be made only by leave of the Tribunal.  If leave is given, an appeal on a question of fact or mixed law and fact is an appeal by way of re-hearing: s 147.  There is power under that section for the Appeal Tribunal to decide whether to receive additional evidence.  Neither side was legally represented at the hearing, which occurred by telephone. 
3. [3]
   In arriving at his decision the Member included as an amount owed by the owners the sum of $16,159.53 as a final payment due on practical completion.  It is common ground between the parties that the works never achieved practical completion, that the builder had not claimed this amount, and that it was not payable.  The owners, whose application for leave to appeal was filed first, challenged the decision on this ground, although they otherwise generally supported the findings of the Member, which had been largely in their favour.  The builder in his appeal challenged a number of the specific findings of the Member, including the finding as to the terms of the contract between the parties. 
4. [4]
   One of the arguments relied on by the builder was that the Member had apparently overlooked certain documents in evidence, and that this had led to incorrect decisions on a number of matters, including as to the nature of the agreement between the parties.  His appeal was more wide-ranging, and challenged various findings of fact by the Member.  It may be that the error of including an amount for the final progress payment could be characterised as an error of law, because the amount was not claimed, but it involved a finding that practical completion had been achieved.  That was an error, and one of fact.  The fact that the Member made this error casts doubt on all his findings.  As it stands the decision is a substantial injustice to the owners, but the existence of this error, and the allegation that evidence was overlooked, suggested a real possibility that the builder may also have suffered a substantial injustice by other errors of the Member.^[1]  Therefore at the hearing I gave both parties leave to appeal.  The appeal is therefore one by way of rehearing.^[2] 
5. [5]
   The builder sought to rely on certain documents not put in evidence at the hearing for the purposes of the appeal.  For that purpose he filed an application seeking such leave, which was adjourned to the hearing of the appeal.^[3]  The Appeal Tribunal has a discretion to allow additional evidence,^[4] but ordinarily this is subject to satisfaction of the conventional rules about the admission of fresh evidence on appeal.^[5]  This is based on the proposition that there is a public interest in the finality of litigation, so that the hearing is the proper time for a party to mount a complete case.^[6]  Accordingly additional evidence is admitted on appeal generally only if it was not available to the party at the time of the original hearing, and could not with reasonable diligence have been obtained then; as well, it must be credible evidence significant to the outcome.^[7]  Where, as here, the parties were not legally represented at the hearing, the former aspect of the test has to be applied by reference to what the Tribunal can reasonably expect lay persons to do by way of preparing and presenting their case.^[8] 
6. [6]
   The builder said that the documents sought to be relied on were among those presented to the lawyer who was assisting in the preparation of material for him, and that the failure to include them was due to the lawyer, who may have been confident of success without relying on them.  It would however have still been possible for the builder to have tendered them during the hearing, during cross-examination of the owners or in his own re-examination.  The assessment of his reasonableness can only be made by reference to each document, and I will consider each where its relevance emerges.  The owners said that, if certain documents were relied on, they would have wanted to question the person who provided the document; that can also be considered when the documents are. 
7. [7]
   Since the hearing of the appeals, I have read all the affidavits, exhibits and documents attached to the application, counter-application and affidavits, the documents the subject of the applications in relation to fresh evidence, the transcript of both days of evidence, and the submissions of the parties in relation to the appeals, as well as the reasons of the Member. 

Contract between the parties

8. [8]
   The Member found that the parties had entered into a contract in writing dated 21 September 2016 on an HIA form but the owners had exercised their right under the Queensland Building and Construction Commission Act 1991 (Qld) (“the 1991 Act”) Schedule 1B s 35, to withdraw from the contract during the cooling off period.  The contract defined the work to be done in terms of an attached document “Scope of Works”, a copy of which is Exhibit 3.  The owners stated that this was because they were unable to obtain bank finance sufficient to pay the contract sum, and that they would have to revisit the Scope of Works to reduce the cost.^[9]  There were subsequently further discussions between the parties, but there was a dispute as to what was agreed between them.  The builder alleged that they had an agreement to proceed with the works as instructed on a do and charge basis, with the builder charging for his labour and passing on the cost of materials and trade work.  The owners alleged that the parties orally agreed that the former written contract was reinstated. 
9. [9]
   The Member accepted the evidence of the owners, and found that the parties had orally reinstated the written contract between them.  He did so because there had been a notice sent by the builder during the work relying on a term of the written contract,^[10] a text sent by the builder relying on a term of the contract,^[11] that the builder had extended the statutory insurance to the lump sum stated in the written contract on 13 March 2017 [51], and because his lawyer had in March 2017 written to the owners’ lawyers relying on the terms of the written contract: [52].  This finding was challenged by the builder on the appeal, on the basis that, after the written contract was terminated, there were further negotiations between the parties about the work to be done, and some items were deleted from the original Scope of Works.  That he submitted showed that the works to be carried out had changed, and narrowed, because of the desire of the owners to reduce the cost of the project; but there was no oral agreement on any new lump sum contract amount.  He said the original contract had been terminated because the owners could not get finance sufficient for that cost.  That the Scope of Works was amended showed, he argued, that there was no oral agreement to reinstate the written contract, to do all the work in the Scope of Works, at the original price. 
10. [10]
    The owners supported the reasoning of the Member, and submitted that the deletion of reference to the kitchen in the list of work to be done by the builder in the Scope of Works was only because the work was to be done by a subcontractor, and there was no reference to the kitchen in the list of exclusions.  The only actual reductions in the work to be done by the builder were those matters covered in the owners’ list of variations in favour of the builder.  Subject to that, the effect of the oral agreement was to reinstate the original Scope of Works, and the original contract price.  They submitted that since they were reliant on finance for the project, they would not have entered into an open ended obligation to pay whatever the work cost.  I shall consider this point further later, but first summarise the balance of the reasons of the Member. 

Reasons for Member’s Decision

11. [11]
    The Member detailed the setting of the dispute, and set out details of the builder’s claim, and the owners’ cross-claim.  He summarised the evidence and arguments about the nature of the contract, already discussed, and referred to authority that an oral contract was still enforceable.^[12]  He discussed and dealt with the issue about the basis of the contract between the parties.  He said that the Scope of Works in the contract was badly drafted, and did not identify the work to be performed with precision: [58]. 
12. [12]
    The Member dealt with various claims of the builder.  He allowed an amount of $3,326.80 for the purchase and laying of carpet which had been paid by the builder, although expressly excluded from the written contract, being listed in Schedule 4: [71].  He disallowed a claim for $15,213.94 for various materials and consumables, on the basis that these were just the sort of things that a builder would have to purchase to complete such works, and were therefore necessarily included in the lump sum price: [77].  A claim for $7,579 for the builder’s labour during the final week of building was disallowed, on the basis that this claim had been based on the builder’s allegation of a do and charge contract, which had been rejected: [81].  A claim for $11,000 paid by the builder to the cabinetmaker who supplied and installed the new kitchen fittings was rejected, on the basis that the Scope of Works included “installation of new kitchen”, which in this case on its true interpretation referred to the supply and installation of the kitchen fittings: [93].  This was on the basis that the only quote that the parties had obtained or discussed was for supply and installation by the cabinetmaker: [92].  
13. [13]
    A claim for $1,108.80 for a sliding shower screen was accepted, on the basis that this had been supplied and was not referred to in the Scope of Works, so that this was a variation: [98].  A claim for $891 for removing and replacing the guttering on the patio was accepted by the owners to be a variation, and allowed to the builder: [101].  A claim for the premium paid to the Queensland Building and Construction Commission for statutory insurance in the sum of $1,377.75 failed, on the basis that it was covered by the expression “builders risk insurance” in the Scope of Works, and that it is usually passed on to the owners in a lump sum contract: [106].  A claim for $313.54 for the cost of bringing tiles and timber by courier was rejected, on the basis that this was an ordinary part of the cost of doing the building work: [114].  There were also various amounts agreed by the owners as variations, construction of an apron and path $369.60, repairing water damage to the bathroom $3,458, additional plastering (also in part the repair of water damage) $3,000, and replacement of the rear door $300: [116].  Finally the builder was also allowed $16,159.63 as the final stage payment, on the basis that practical completion had been achieved: [119].  The total payable to the builder was therefore $28,613.73. 
14. [14]
    There were then a number of claims by the owners for variations.  The first was $11,340 for the supply of a shed kit, which they had paid for but which they said was covered by the contract.  The builder said that he only ever agreed to erect the shed kit, and that the owners had ordered and paid for the shed kit themselves.  This was resolved in favour of the owners, on the basis that the parties’ course of conduct was not inconsistent with the owners’ expectation that the builder would supply the shed: [128].  Accordingly the expression “installation of a shed” in the scope of works included supply: [129]. 
15. [15]
    The next claim was for $235 for a laundry tub, rejected on the basis that it was not referred to in the Scope of Works, and that there was no clear agreement in contemporaneous documents that the builder would pay for it.  A claim for $965.10 for a vanity basin and mirror was allowed, on the basis that the Scope of Works referred to “installation of vanity and bathroom accessories” and that in this case also “installation” included supply: [141].  A claim for $1,000 for the omission from the contract of bi-fold doors to the rumpus room was rejected.  The Scope of Works referred to “installation of new internal doors” but there was said to be no document defining what this covered (such as a plan), and in the absence of any good evidence of any other agreement to supply them, it was not accepted that the expression included the bi-fold doors: [149].  A claim for $4,000 for external painting not done was allowed, on the basis that this was covered by the Scope of Works, and that the email from Mrs Jaques of 4 October 2016 nominating that figure for a saving for not doing external painting was evidence of a reasonable valuation of this variation: [153], [154].  A claim for $751 for a QLeave payment which did not need to be made was allowed, on the basis that it was mentioned in the Scope of Works but never paid: [160]. 
16. [16]
    As well a claim for $2,666 as the cost of replacing some vertical blinds was allowed, on the basis that it was not contested by the builder: [163].  A claim for liquidated damages for delay was made by the owners, on the basis that they were not allowed access to the property until 13 March 2017, 55 days after the expiry of the building period of 63 days specified in the contract, plus seven days allowed by the owners for one variation, the work involved in repairing the water damage.  The builder defended this claim on the basis that after the written contract was terminated no further period for completion was agreed, but the written contract specified a period of completion from when building work commenced, not from a specific date.  As well he argued that there had been delays due to additional works requested by the owners, and delays by trade suppliers, but the builder had failed to produce evidence supporting any such delays.  Accordingly the claim was allowed in full, at $50 per day, $2,750. 
17. [17]
    A claim for compensation for loss of income by Mrs Lohmann was rejected, as was a claim for legal costs, under the QCAT Act s 102.  A claim by the builder for interest at the contract rate of 18% per annum was disallowed, on the basis that it was inequitable, being more in the nature of a penalty and being greater than the interest at a commercial rate which would be allowable to the owners on amounts payable to them: [189].  Overall therefore the amounts allowed to the owners came to $22,472.10.  This was deducted from the amount payable to the builder, to give a balance in favour of the builder of $6,141.63. 

Terms of the contract

18. [18]
    This issue is fundamental to the relationship between the parties, and accordingly should be resolved first.  The builder’s case was that the written contract was only entered into to satisfy the bank, and that the true agreement between the parties was to a different effect.^[13]  In substance, his case was that the written contract was a sham, although he did not adopt that term: p 1-22.  That is always a difficult assertion to sustain, and I can identify no evidence of any statement or conduct by the owners consistent with it.  Given that the function of the written contract was to satisfy the bank providing the finance, it is unsurprising that payment claims were made in terms of the document, and that the document was relied on in the notice of cessation of work, which was sent with other communications apparently designed to hurry up payment.^[14]  The reliance on the terms of the written contract later by the builder, and by his lawyer, are more difficult to reconcile with this proposition. 
19. [19]
    That the owners were borrowing to finance these renovations may be significant in one way, in that it may provide an explanation for the building contract gathering up within it various items of work which the owners might have originally had in mind arranging for themselves with suppliers.  It appears that the bank’s procedures involved some degree of supervision of the contract: payment claims were passed on to the bank, and only paid by it after a valuer appointed by the bank had confirmed that the work had been done.  The bank may have preferred to deal with only one contractor, rather than also separately with some suppliers, such as the cabinetmaker.  There is however very little evidence about this, apart from inferences from the emails exchanged on 27 September 2016^[15] and evidence of what actually happened with the payment claims. 
20. [20]
    On the other hand, there are some objective difficulties with the owners’ case, that on 6 November 2016 the parties agreed to reinstate the original contract.  In the first place on any view of the matter there were alterations to the Scope of Works.  The owners accept that exterior painting and the bi-fold doors in the rumpus room were dropped,^[16] and the owners provided an amended copy of the Scope of Works, which omitted exterior painting, and crossed out removal of existing air-conditioning equipment, installation of insulating batts to ceiling cavity,^[17] QLeave, removal of existing kitchen and installation of new kitchen, the latter two annotated “included in kitchen quote.”^[18]  There had been a discussion of how cost could be saved, but there was no agreement on any change to the lump sum price, or any evidence of one. 
21. [21]
    At times the builder appeared to be cross-examining on the basis that the existing lump sum price applied to the amended Scope of Works document.^[19]  In a context where any agreement on 6 November 2016 followed discussions between the parties about ways for the owners to save money, it would not be a commercial interpretation of such an agreement that it provided the same lump sum price for a reduced scope of works.  There is also a suggestion in an email that the contract price was kept the same so that the bank would advance that money, and if the amount payable to the builder was reduced, there would be money left over for the owners.^[20] 
22. [22]
    As well, other aspects of the work changed after 6 November, without any evidence of concern on either side about just what effect this would have on the lump sum price.  For example, prior to the contract document being signed, the owners sent the builder a quote they had obtained from a cabinetmaker for the new kitchen, which also covered a laundry cabinet and a vanity cabinet, for a total of $19,239 including GST.^[21]  Later further changes were made, and on 2 December 2016 Mrs Lohmann was sent Quote 5302 addressed to the owners for $20,130 including GST, which also covered a vanity cabinet and four sets of robe or linen doors.^[22]  The final quote, 5323, addressed to the builder, was sent to the owners on 20 December, and forwarded to the builder before it was signed by Mrs Lohmann.^[23]  (The fresh evidence sought to be led concerning the kitchen, discussed later, reveals further intervening quotes and discussion, but not about the effect of any of this on the lump sum price.) 
23. [23]
    The Member approached the resolution of this matter on the basis that the subsequent actions of the builder were inconsistent with his claim that the true contract between the parties was a do and charge contract.  He did not address the difficulties posed by the adjustment of the Scope of Works on 6 November 2016, although treating the contract as reinstated in its original form to some extent overcomes these, since it means that things omitted from the Scope of Works have to be dealt with by adjustments to the contract price.  To some extent this is an exercise in finding what would have been a convenient agreement between the parties in the circumstances, rather than what they had actually agreed, but in circumstances where it is clear enough that the parties did agree to something, courts have always striven to uphold contracts, rather than allow them to fail just on the ground of uncertainty, and to give them a practical commercial construction.^[24] 
24. [24]
    There is also the consideration that, if the true agreement had been on a do and charge basis, one would expect the builder to be able to produce details of just what chargeable work he had done from the start of the contract, and how he had allocated the payments he had received from the bank towards this, and towards any payments he had made to third parties.  He completed the paperwork for the bank as if there was still a lump sum contract, but there was no evidence that he was also providing invoices to the owners which were consistent with what he claimed was the true agreement between them.^[25]  This was so even when they asked for information about how the money was going, in texts attached to the original application for domestic building dispute.^[26]  Requests for a spreadsheet do not appear to have produced a meaningful response.^[27]  As well, there was nothing to show how the total amount referred to in the written contract was derived.  It appears to have come from the builder, and presumably was not just a figure plucked out of the air, yet particulars of it were never produced, despite requests when the owners were looking for ways to save money.  It would clearly have supported the builder’s case that certain things were never included in the work covered by the contract, if that were so.^[28]  The builder appears to have sought to produce relevant documentation only when a dispute had arisen between the parties.^[29] 
25. [25]
    Both parties submitted that insufficient attention had been paid by the Member to inaccuracies in the evidence of the witnesses for the other side exposed in the course of cross-examination.  The problem here is that to some extent errors were exposed by cross-examination on both sides, and although the Member did not mention this, I expect the explanation was that this was not a case where he considered that indicia of unreliability on the part of a particular side was of some significance in resolving the issues in dispute.  Since I have not seen the witnesses myself at the hearing, I can hardly go behind such an approach, and act on any assessment of the reliability of witnesses from the transcript. 
26. [26]
    A transcript of a recording the builder made of a conversation with the owners at the property on 5 March 2017, which did not resolve the dispute, went into evidence:  Exhibit 8.  In his cross-examination of the owners the builder said that six times during that conversation he had referred to the do and charge arrangement made at the first meeting, and that had not produced any dissent from the owners.  This was relied on as an implied admission that that arrangement had been made.^[30]  The owner accepted that Exhibit 8 was reasonably accurate (p 1-41) but said that he did not dispute what was said because he had no idea what the builder was talking about: p 2-6.  I have looked at Exhibit 8, and although the builder and his wife said things that were consistent with what he said the arrangement was, there was no such statement of his version of the agreement which I would have expected to provoke any disagreement if it were not true.  At p 2 they spoke about not doing “renos on contracts”, but added “obviously you guys needed a contract to get your finance. … So that’s why we had to do a contract on this job.”  At one point Mrs Lohmann said that they had no choice but to go with the contract because of the bank, and later Mrs Jaques said in effect that as a rule we do not do contracts, but we bent it in your case so you could get your loan: p 8.  Overall this transcript does not assist the builder. 
27. [27]
    I have considered whether the fact that the parties used a written contract which was so badly drafted, in particular the Scope of Works, supports the argument that it was not the real agreement between the parties, because so much had been left uncertain by it.  If it were just a sham to keep the bank happy, the parties might not have been concerned by its deficiencies.  However, I have no evidence of the terms of any other lump sum contracts the builder entered into, and it may be that they were relatively rare for him, so that he was not experienced in the proper drafting of such documents.  As well, this one seems to have been prepared in something of a rush, because the builder and his wife were about to leave on a trip overseas, and that could provide an explanation for an unsatisfactory drafting exercise.  On the whole, I do not consider that there is a proper basis for treating this as a relevant factor. 
28. [28]
    One difficulty with the builder’s case is that, as set out in the annexure to his application, after the written contract was terminated there was an offer of a do and charge arrangement in an email of 27 September 2016,^[31] which was accepted by conduct, by the owners proceeding in accordance with it.  At the hearing the builder’s evidence was that the work was done under an oral agreement made on 18 September 2016, at the first meeting, in terms of the arrangement outlined to the owners as to how the builder did such work: p 1-21.^[32]  The factual difficulty with that case is that it is unlikely that the owners would commit to a definite agreement with the builder at their first meeting, without even getting a quote, or for that matter enter into an open ended obligation to pay whatever the renovations cost.  The legal difficulty is that, if there was an oral agreement at that time, it was superseded by the later written agreement (unless that was a sham) and not revived by the statutory termination of the written agreement.  The only plausible explanation for the work being done is that, at some point between 27 September and 8 November, some agreement was made between the parties, and the builder gave no evidence of such an agreement on the terms alleged by him.  On the appeal, the case advanced by him was that after termination of the written contract, it changed to a “do and charge” contract.^[33]  Such inconsistency in his case is unhelpful.  
29. [29]
    Therefore I consider that, although there are indications each way, overall the various factors I have referred to support the conclusion of the Member, that there was a further agreement between the parties on 6 November 2016, and that the effect of the agreement was that the prior written contract between the parties, which was not a sham, would be reinstated, although subject to certain adjustments to the Scope of Works, the financial consequences of which were not subject to specific agreement.  In those circumstances, the law implies that there will be a reasonable adjustment to the contract price for the work originally covered by the contract, but not done.  The practical effect of this is that any deletion from the Scope of Works gave rise to an entitlement to an appropriate deduction from the contract price, just as any additional work gives rise to an entitlement to reasonable additional payment. 

Appeal by the owners

30. [30]
    It is now convenient to deal with the appeal by the owners.  They challenged the findings that the works had achieved practical completion, and that the builder was entitled to the amount of the final payment: [119].  It was common ground at the hearing of the appeal that practical completion had not been achieved.  The finding cannot be supported on the basis of the doctrine of substantial performance, because no mention of this was made by the Member in his reasons, and because, if that payment had been treated as recoverable on this basis, it was necessary to make an allowance for those parts of the work not done.^[34]  That did not occur.  Hence this adjustment must be made.  This may have consequences for the other findings of the Member. 
31. [31]
    One consequential issue which arises is whether the builder has a right to recover something for work done which fell after the stage four progress payment, even though all the work required to achieve practical completion had not been done.  The builder’s claims for labour in the last week, and for money spent at the local hardware store, were rejected on the basis that these claims were really based on the builder’s alleged contract, and rejection followed from an acceptance of the owners’ contention as to the contract.  Once the final payment was allowed under the contract, the builder had a claim only for variations.  But it is clear that the contract was terminated before the final payment, on practical completion, became payable.
32. [32]
    In these circumstances, on termination of the contract a builder will have a right to recover on a claim in quantum meruit for work done towards the final stage and not covered by the earlier payments, but only if the contract was terminated by the builder for repudiation by the owners.^[35]  It is available as an alternative to damages for breach of contract in that situation.  Accordingly it is necessary to identify how the contract came to an end. 
33. [33]
    At the end of February work stopped.  On 26 February the builder emailed the owners advising that there was not enough money in the contract to complete all the work in the Scope of Works.^[36]  The next day the bank’s valuer approved payment of the Stage 4 claim,^[37] and the builder and owners met on the site, but nothing was resolved,^[38] as was the case on 5 March, after which the builder secured the site, excluding the owners.^[39]  On 11 March the builder sent a statement claiming that $40,459.80 was owing by the owners.  Two days later the parties met on site with a representative of the QBCC, but all that was agreed was that the owners would be allowed to occupy the site.^[40]  On 5 April the owners’ lawyer wrote to the builder’s lawyer, characterizing the builder’s conduct as repudiation, and accepted that repudiation, terminating the contract.^[41] 
34. [34]
    On the basis of what has been found to be the true contractual position between the parties, I consider that the actions of the builder did amount to repudiation of the contract between the parties, and that the owners were entitled to accept that repudiation, and to put an end to the contract.  The contract was terminated by the owners, so the contractual rights of the builder under the General Conditions of Contract (Exhibit 4) Clause 28.7 did not arise.  In that situation, there is neither a contractual entitlement to any of the work done under the last stage of the job, nor an entitlement to reasonable remuneration in quantum meruit.  The builder cannot recover for work done which was part of the work required under the contract to achieve practical completion. 

Appeal by the builder

35. [35]
    Apart from the issue of the terms of the contract between the parties, the builder raised a number of specific grounds of appeal.  The first that there was a mathematical error made by the Member in working out the net amount payable, associated with the fact that the amount found to be payable to the owners was more than the amount they had claimed in their counter-application.  The reason for this is that the amount claimed by the owners for the value of variations to the contract, $6,956.70, was a net amount after deducting $11,334.40 due to the builder from the $18,291.10 they claimed was due to them.  But the amounts allowed by the owners in their cross-application as variations in favour of the builder were taken into account by the Member as part of the amounts payable to the builder on his claim: [118].  That approach was appropriate given that these were amounts payable to the builder, and it would have been an error also to deduct them from the cross-application.  Since the figures will change anyway as a result of the appeal, I need not be concerned further with the Member’s mathematics. 

Kitchen

36. [36]
    The builder submitted that the Member erred in finding that the cost of the work on the kitchen done by the cabinetmaker was included in the Scope of Works and hence in the contract sum.  The builder argued that he had no contract with the cabinetmaker, since the quote had been signed as accepted by the owner, and that the email from his wife on 20 December 2016 did not amount to authority for Mrs Lohmann to enter into a contract with the cabinetmaker on behalf of the builder.^[42]  The builder also relied on evidence that the owners had signed a contract for the kitchen by accepting a quote addressed to them on 6 December, relying on the fresh evidence referred to earlier.  He also relied on the changes to the Scope of Works by the owners referred to earlier where the references to the kitchen were crossed out, and on the fact that the Scope of Works never referred to the “supply” of the new kitchen.  He also relied on the omission of any reference to supply of the kitchen in the client brief document provided by the owners at the first meeting. 
37. [37]
    The owners relied on the findings of the Member, that the contract had been signed with the approval of Mrs Jaques; that the kitchen was not listed in the written contract as a Prime Cost item or in the list of exclusions; that they had provided the builder with the quotes they had obtained from the cabinetmaker; and that the continuing communications between the parties, and the payments the builder made to the cabinetmaker, were consistent with the cabinet work being included in the contract.
38. [38]
    In relation to this issue, the builder sought to rely on additional evidence not relied on at the trial.  An application was filed on 11 June 2020 seeking to rely on a further twenty-two documents, said to have been provided by the builder to his solicitor and not included in the material filed by the solicitor.  The majority of the documents related to the course of communications between the owners and the cabinetmaker during the finalisation of the arrangements for the kitchen.  Some of these are indeed already in evidence, most in attachments to the submissions with the owners’ response to the application, and counter-application: documents 1 and 1a are attachment 37, documents 3 and 3a are in attachment 10, and document 6a is in attachment 11.  Document 6 is document 34a attached to the builder’s second affidavit. 
39. [39]
    The documents show that the owners had contact with the cabinetmaker before they saw the builder, and had obtained a quote 5132 which they provided to the builder on 18 September 2016: documents 1 and 1a.  On 22 September 2016 the cabinetmaker sent the owners quote 5234 for five sets of robe doors, not mentioning the kitchen, and on 2 December 2016 sent quote 5302, which covered the kitchen, four sets of robe doors, and a vanity cabinet: document 3.  This did not elicit a response and the cabinetmaker chased it up by way of Mrs Jaques, but Mrs Lohmann found it on 6 December, and replied seeking changes: documents 3a, 7a.  The result was quote 5303 sent to the owners on 6 December (documents 4, 4a) which was the same as quote 5302 except that it omitted reference to the vanity cabinet.  Mrs Lohmann responded saying she would sign the quote and drop it to him: document 4b.^[43]  On 7 December she said she had done so: document 9a. 
40. [40]
    Up to this point all the quotes had been addressed to the owners, but quote 5313 sent by the cabinetmaker on 15 December was addressed to the builder (document 5), although still sent to the owners: document 5a.  This quote was the same as quote 5303 except that GST was taken out of the kitchen figure and the amount for the robe doors, and there were three extras including a robe insert.  It was forwarded to the builder on 18 December: document 5a.  There must have been further communication between the owners and the cabinetmaker, because on 20 December quote 5323, for $20,790 including GST, also addressed to the builder, was sent to the owners: document 6.  It was forwarded to Mrs Jaques, who was asked if she was happy for Mrs Lohmann to sign it: document 6a. Mrs Jaques replied “If your happy with the quote all good I did have a look.”: document 10a.^[44]  There was no discussion about the effect of this on the price.  Mrs Lohmann signed the quote as accepted.^[45]  The owners argued that this formed a contract between the builder and the cabinetmaker, as she had been authorised by the email to sign on behalf of the builder. 
41. [41]
    The application also covered a statement provided by the cabinetmaker to the effect that he had dealt with the owners in relation to the design, the quotes and (primarily) in relation to the installation: document 11a.  In relation to this the owners said that if it had been tendered at the trial they would have sought to cross-examine the cabinetmaker on it, with a view to eliciting evidence of any dealings he had with the builder.  That the cabinetmaker discussed the design and finishes of the kitchen with the owners is no more than I would expect to occur. 
42. [42]
    The builder has, since the hearing of the appeal, filed an application seeking leave to tender fresh evidence, in the form of the quote from the cabinetmaker dated 6 December 2016, quote 5303, addressed to the owners and apparently signed by them as “accepted” on 6 December 2016.  This simply confirms that that quote, addressed to the owners, had been accepted by them, and hence a contract formed with the cabinetmaker before any quotes were sent addressed to the builder.  This confirms the admission in document 9a. 
43. [43]
    The difficulty with all this material is that it is directed to showing that the owners not only dealt with the cabinetmaker about the kitchen, but entered into a contract directly with him.  The builder sought to rely on this as clear evidence that the supply and installation of the kitchen was outside the contract, since the owners were arranging for it separately.  In my opinion it does not matter who had the contract with the cabinetmaker, except as to who is liable to pay the cabinetmaker.^[46]  Someone must be.  Mrs Lohmann signed a contract with him, purportedly on behalf of the builder.  If she had authority to do that, the builder is liable; if she did not, she is liable, for breach of warranty of authority.  That dispute is not before the Tribunal. 
44. [44]
    What matters here is whether the cabinetmaker’s work was covered by the contract between the owners and the builder in its original form.  What matters is who, as between the builder and the owners, has to pay the cabinetmaker, a different question from whom the cabinetmaker can sue to get paid.  This depends on the interpretation of the contract, and particularly, as the Member said, on whether the expression “installation of new kitchen” in the Scope of Works included supply.  For that reason, this evidence is generally not relevant to the issue before the Tribunal. 
45. [45]
    That the final quote was addressed to the builder is consistent with the owners’ case that the kitchen replacement was covered by the lump sum price,^[47] but it does strike me as odd that the owners would be changing details of the cabinetmaker’s work covered by a fixed price contract without even any discussion with the builder about the effect of this on the contract price.  One would expect that, under such a contract, there would be at least a claim by the builder to recover the extra cost of additional cabinetmaker’s work sought by the owners after the lump sum was agreed.  On the builder’s case, there was no reason for him to be concerned about any effect on the price, which was his attitude at the time.  The real point here is that, had the written contract been better drafted, the cabinetmaker’s work on the kitchen (and indeed his other work) would have been put in the contract as a provisional sum, or as an exclusion, or as subcontractor’s work. 
46. [46]
    When the builder sent his first list of variations, with the email of 26 February 2017, it included a claim for $5,100 as “kitchen price blowout from original costings supplied.”^[48]  As I read the original quote 5132 of June 2016 and the final quote 5323, the figure for the actual kitchen part had increased by only $220 plus GST.  Each quote also covered other things, but the only additional item possibly referable to the kitchen was only $968.  I cannot work out how the figure of $5,100 was arrived at, but for present purposes what is interesting is that the wording suggests that some allowance had been included for the kitchen in the original costings.  On the other hand, the same email attached a list of “expenses to be paid” which included $13,790 to the cabinetmaker; that is more consistent with the builder’s case.  Unfortunately the builder was not cross-examined about this. 
47. [47]
    In relation to this material as fresh evidence, the short answer to the builder’s applications, so far as they relate to material relevant to the kitchen, is that the material is not relevant to the real issue, that is, the correct interpretation of the contract between the parties.  For that reason it should not be admitted on the appeal: the material sought to be relied on is irrelevant to the outcome. 
48. [48]
    The basic principles of construction or interpretation of contracts are well established.^[49]  What matters is what the parties have objectively agreed to, that is, what would be apparent to a reasonable independent observer to be the effect of their agreement.  This is to be ascertained from the actual words used in the contract, considered as a whole, and viewed in the light of the factual context of the contract, and the apparent commercial purpose of it.  The subjective views of the parties as to their intentions, and indeed as to what they have agreed, are not relevant.  In the present case the parties seemed quite firm in their views on what had in fact been agreed to, but in circumstances where the contract is in writing, it is the correct objective interpretation of the written document that matters.  That may well differ from the subjective understanding of one, or even both, parties.  As a result, a party may be bound by a contractual requirement the party did not realize he or she was undertaking by entering into the contract.  This just emphasizes the importance of precision of expression when preparing written contracts. 
49. [49]
    One principle of interpretation is that behaviour after a contract has been made cannot be considered when interpreting the contract, although it can be considered in some circumstances where the issue is whether a contract was made, or whether it incorporated a particular term.^[50]  The actions of a party are really a reflection of the subjective opinion of the party as to what the contract means, which is irrelevant.  As well, the meaning of a contract must be determined as at the date it was made.  It is not clear that the Member generally confined his attention to pre-contract conduct, and many of the submissions of the parties on this and other issues were directed to the significance of post-contract conduct. 
50. [50]
    That is another difficulty with the fresh evidence relating to the kitchen.  It is an example of post-contract conduct of a party, which on the authorities cannot be taken into account in the interpretation of the contract.  Accordingly those documents cannot be accepted as fresh evidence, as they are inadmissible as irrelevant to the matter in issue.  
51. [51]
    It is true that the word “supply” was not stated expressly in the Scope of Works, and that there was no mention of the kitchen in the client brief, except for replacing the ceiling, and doing the required plumbing and electrical works to fit the design of the new kitchen.  However, as the Member noted, the Scope of Works uses the term “installation” in a number of places where it is obvious that the thing to be installed is also to be supplied.  Examples are “installation of new internal doors and external door (entrance)”, in a context where the client brief made it clear that the new doors were to be supplied; installation of new internal wall framing; and installation of new ceilings. 
52. [52]
    The Member outlined the facts and contentions, and referred to the conduct of the parties indicating that supply was covered as well as installation.  The conduct referred to was that the builder never intended to build the cabinets himself, and never obtained a separate quote for the supply of them, and the only quotes discussed covered supply and installation.  That is true, although it is not clear that the Member was confining his attention to conduct prior to the contract being entered into; subsequent conduct cannot be used to assist in the construction of a term in a contract.  One thing that may be noted is that, if the lump sum contract covered the supply of the kitchen and the builder never intended to build the cabinets himself, it is a little odd that the “installation” of the kitchen was not listed in the part of Scope of Works headed “Works to be carried out by subcontractors.”  However, it is clear that even this was not a strict division; the plasterboard walls and ceilings were installed by a plasterer, not the builder personally, but are included in the “works to be carried out by the builder.”  This document was badly drafted, and in the circumstances such factors cannot be decisive. 
53. [53]
    There is also the consideration that the cabinetmaker had quoted to install the kitchen as well as to supply the various new fittings, as is I believe common with cabinetmakers who produce kitchens, so that it would be expected that whoever supplied the kitchen would also install it.  The builder relied on the fact that the amended Scope of Works provided by the owners on 6 November 2016 had the references to the kitchen crossed out and noted “included in quote”, a reference to the quote from the cabinetmaker. Mrs Lohmann said that this was because that work did not have to be done by the builder (p 2-51), which is actually consistent with the cabinetmaker’s work not being covered by the contract; otherwise this is of no significance, since if the effect of this change was to take the kitchen out of the contract, the owners would be entitled to a reduction in the price to cover it anyway, as was the case with the external painting.  Assuming reference can be made to this action, it does not assist in the interpretation of the original Scope of Works. 
54. [54]
    The kitchen was also mentioned in the special conditions of the contract form, where more details were given about the work which made up the various progress stages.^[51]  Stage 4 expressly included “kitchen installation”.  That is inconsistent with the notion that the kitchen was entirely outside the contract, and in that way adds something to the idea that “installation” included supply.  The contract is to be interpreted as a whole, and regard is to be had to all parts of it. 
55. [55]
    The issue is finely balanced, but on the whole I consider that the preferable interpretation of the Scope of Works is that it did include the supply as well as the installation of the kitchen, and hence the cabinetmaker’s work.  One factor which provides some assistance in resolving this issue is that the contract and the Scope of Works were prepared by the builder, and in those circumstances the law tends to prefer that any deficiencies in clarity of drafting should be resolved in favour of the other party.^[52]  It follows that this challenge by the builder to the decision of the Member fails. 

Shed Kit

56. [56]
    The next issue raised by the builder was the similar finding by the Member that the term “installation of shed” in the Scope of Works included the supply of the shed kit: [131].  The arguments were similar; the owners had obtained quotes for supply and erection of a shed, which were provided to the builder, although this time the list of work to be done they provided to the builder used the term “erect shed”, a fact not mentioned by the Member.^[53]  The document also referred to certain items being “included in kit”, and expressly to the “supply” of light fittings in the shed.  He also did not mention that the special condition of the contract document, mentioned earlier, used the term “shed erection”.^[54]  It seems to me that the term “erection” is more difficult to interpret as including supply than is the term “installation”. 
57. [57]
    Again the builder had been provided with the quotes to supply and erect the shed before the written contract was drawn up,^[55] but it would have been easy enough for them to have obtained supply only quotes from the suppliers.  The owners relied on an email from the builder of 4 October 2016, which said inter alia: “If we buy the shed in kit form and construct the shed and do the slab there is a big saving there … their margins are huge.”^[56]   The difficulty with this as evidence of the meaning of the contract, apart from its being post-contract conduct, is that it appears to be suggesting a saving by the builder erecting the shed, which he was to do anyway under the Scope of Works.  This was sent while they were on holiday, and did not have the relevant documents available, and in the circumstances I would not attribute much, if any, significance to it. 
58. [58]
    The builder’s application to introduce fresh evidence on the appeal referred to four documents relating to the shed kit: a quote from Wide Span Sheds to the owners of 19 October 2016 for a shed kit (supply only);^[57] a variation dated 20 October 2016 allowing a special discount of $290 for job WSS163364-1, signed by the owners; an email from the shed supplier advising that the owners sent them an email on 20 October 2016 asking that the invoice be made out to the builder; a copy of the purchase agreement for the shed kit 20 October 2016, job WSS163364, signed by the owners.  The last of these was already in evidence.^[58]  These documents are post-contract documents, and simply confirm that the contract was put into the name of the builder at the instance of the owners.  For the reasons explained earlier, these are not relevant to the interpretation of the written contract between the builder and the owners.  The Member knew that it was the owners who bought and paid for the shed kit.  The issue was, who as between the builder and the owners had the obligation, under the contract between them, to pay for it.  That depends on the correct interpretation of that contract, to which these documents are not relevant.  They are therefore not admissible on appeal.   
59. [59]
    The owners argued that there was an oral offer by the builder to reimburse this cost on 6 November 2016, which was consistent with the notion that the supply of the shed kit was included in the contract.^[59]  The builder denied this.^[60]  The Member did not resolve this conflict, and I cannot.  The owners had ordered and paid for a shed kit while the builder was on holiday, they said to beat an impending price rise, and informed the builder of this in an email which actually said: “If there is money left over at the end we can be reimbursed.”^[61]  That is ambiguous, as it implies that there is no obligation to reimburse if no money is “left over”, presumably out of the contract price, at the end of the job.  If the contract covered the purchase of the shed kit, and it was not a prime cost item, the owners had no reason to be concerned about the impending price rise in the shed kit, and despite the earlier quotes, the agreement the owners signed with the supplier was for only the supply of the shed kit, not for its erection.^[62]  In any case, such a statement could only be a reflection of the subjective view of the writer of the email as to the contractual obligation, which is not a relevant consideration.  This does not assist in interpreting the contract in its original form. 
60. [60]
    One factor which strikes me as of some significance is that it does not appear that, as at the date of the contract, the owners had chosen which shed kit they wanted,^[63] yet the shed was not put as a prime cost or provisional cost item in the contract form.  On the other hand, nothing was put as a prime cost or provisional cost item in that form, and other things changed after the contract, including details of the kitchen.   Again, this reflects the bad drafting of the contract.  The builder relied on the fact that the contract with the supplier was made by the owners, although put into his name without authority.  Again, for the reasons given in relation to the kitchen supply, this is not relevant to the issue of interpretation of the written contract. 
61. [61]
    I am conscious of the owners’ arguments that things changed after they formulated the list of work to be done, that in other places in the Scope of Works, “installation” included “supply” and that the shed kit was not listed as an exclusion.  Looking at the contract itself, although the word “installation”, in this contract, is ambiguous, the term “erection” in the special condition is less likely to include supply, and when one takes into account the surrounding circumstances, that the owners had originally asked only for erection, and had apparently not then chosen a particular shed kit, I consider that the correct interpretation of the contract is that the Scope of Works did not include the purchase of the shed kit, and that the Member erred in arriving at the opposite conclusion.  On this issue, the builder is entitled to succeed. 

Exterior painting

62. [62]
    The builder argued that no amount should be allowed for the exclusion from the work done of the exterior painting.  This argument really depended on the proposition that the builder was undertaking a “do and charge” contract, and was based on the idea that he had not charged the owners for the work.  The owners’ claim was based on the fact that the exterior painting was included in the original Scope of Works, and had been deleted when the amended document was provided on 6 November 2016.  Certainly that occurred, and had been the subject of some prior discussion in emails, in terms of how money could be saved; but there was no evidence that on 6 November the parties agreed to reinstate the written contract but with the amended Scope of Works, so that the owners were paying the same price for less work, and that would not be a reasonable interpretation of what was agreed that day. 
63. [63]
    I agree with the Member that the effect of the reinstatement of the contract was that the price was to be adjusted for any omissions from the original Scope of Works, just as it would be increased for any additional work not covered by it.  The exterior painting was not done, so the owners were entitled to a reduction in the price for it.  There was no argument directed to the amount of the reduction, which was reasonable.  I agree with the decision of the Member on this issue, and this part of the appeal fails.

Late completion damages

64. [64]
    The builder challenged the Member’s decision to allow liquidated damages for delay under the contract: [177].  Under the general conditions of contract Exhibit 4 the owners were entitled to liquidated damages for the period between the expiry of the stipulated period for completion and practical completion, but that was never reached.  The contract was ultimately terminated before practical completion was achieved, although this occurred after the expiration of the period for completion.  In such circumstances, owners are ordinarily entitled to liquidated damages only up to the termination of the contract,^[64] although in this case the owners claimed such damages only to the date on which they were given access to the property, in accordance with Clause 32.1.   
65. [65]
    The contract provided that the period for completion ran from the commencement of work, and on the evidence that was on 8 November 2016.  Since the period allowed was 63 days, even on the original contract it would have been expected that it would run into the Christmas period, since the parties knew that the builder would be away for five weeks before starting the job anyway.   It follows that no extension is allowed for the Christmas period. 
66. [66]
    The builder argued that the effect of the withdrawal of the owners from the written contract was that it and all its terms came to an end, including the provision for late completion damages.  That was true, but it was not the end of the story.  The Member found that the parties subsequently agreed orally to reinstate the written contract, a finding with which I agree.  The effect of that agreement was to make the contract effective again as if it had never been terminated, and that included all of the contract, including the provision for damages for delayed completion. 
67. [67]
    The next argument of the builder on this issue was that the Member had not allowed sufficient additional time for the additional work which the owners had requested, and had not had regard to a schedule identifying this work, and setting out when it was done, and what additional expense was involved, referred to as document 47a.  Part of the difficulty with this document is that the builder was not cross-examined on it, nor were the owners cross-examined in detail about the assertions made in it.^[65]  In written submissions on the appeal, the owners said merely that many of them were covered by the Scope of Works, but did not say which.  A further difficulty is that, although the document refers to a number of items not in the Scope of Works, most of them were work which was not claimed by the builder as a variation requiring an additional payment, and none of them were the subject of a notice claiming an extension of time under clause 17.3. 
68. [68]
    The first was supplying and installing insulating batts in the ceiling.  This was originally in the Scope of Works, but was crossed out on 6 November.  The builder said the owners later asked that it be done, and it was done, and the owners did not claim a credit for it, which confirms that it was done.  The builder claimed that the work was done from 25 to 28 October 2016, but what matters is the additional time taken for the work overall for this additional task, and I find it hard to accept that it took four days. 
69. [69]
    The second was installing new door jambs, architraves and skirting to doors, built in wardrobes and linen cupboards.   This is attributed to four days in November and three in January, but again this seems a long time, although the number of doors involved is not stated.  The Scope of Works document Exhibit 3 includes as an item of work by the builder “Fix out – skirting and architraves.”  On the face of it, this covered this work, and no extension is warranted. 
70. [70]
    The next two are additional items supplied, and did not affect the time taken for the work.  The next is to supply, install and paint a new side light for the front door, done over five days; supply and install downpipes to shed, done on one day; and repairing door locks on the sliding doors in the rumpus room and kitchen, for which no date was specified.  These items are not covered by the Scope of Works, and some additional time for them seems reasonable. 
71. [71]
    There was then work involving removing the existing evaporative air-conditioner and its fittings, patching the roof, and making holes in three walls to accommodate the new air-conditioners, presumably reverse cycle equipment.  There was a later item for doing some repair work, apparently after the fitting of the air-conditioning, but no date is attributed to this.   The air-conditioning work was originally part of the Scope of Works, it was deleted on 6 November 2016, but was ultimately done anyway.  This should therefore have been covered by the original construction period. 
72. [72]
    There was an item for carrying the shed kit from the kerb to the site of the shed, but I regard that as part of the task of erecting the shed.  The same applies to digging the trench for the power supply to the shed, since lighting and power were included in the original list of work required.  The Scope of Works included installing the hot water system, and this covered the provision of a concrete pad to stand it on, and “Council BA application and approvals”, which covered the provision of drawings required by the local authority to obtain approval for the patio.  Moving appliances from the shed back to the kitchen, presumably in connection with the installation of the kitchen, was I consider covered by that work.  Plumbing for the fridge, which required a water connection, was also covered by installation of the kitchen, and plumber’s work in the kitchen area.  None of these justify any extension of time. 
73. [73]
    The next item was installing a concrete path to the door of the shed, to which two days were attributed.  This was additional work, a payment for it was allowed, and some allowance should be made for it, along with installing the laundry tub (including plumbing), also found to be additional work.  There were a number of items which appeared to be associated with the work to repair the water damage around the bathroom.  This was additional work, and the owners accepted both the extra charges claim for this in the proceeding, and an allowance of seven days extension of the construction period for it, which the Member regarded as reasonable, as I do. 
74. [74]
    There were claims for extra work in the laundry, fitting Villaboard to a concrete block wall, skirting tiles, tiling behind the washing machine, and a tiled splashback to the laundry tub.  These were not included in the Scope of Works, which referred only to the bathroom and “main living area”, which is not the laundry, and some allowance should be made; the work was said to have been done over four days.  There was also a claim for removing existing tiles, but the Scope of Works did include removal of tiles, so no allowance should be made for this.  There was a claim for supplying and fitting new mixers in the shower area, but plumbing work in the bathroom was included, and two hand held showers were referred to in the list of jobs to be done provided by the owners, so it appears that this was not additional work. 
75. [75]
    There were claims for installing gyprock or (in a wet area) Villaboard walls in various rooms, perhaps to line existing block walls, said to have been requested by the owners and not included in the Scope of Works.  This work appears to be separate from the work involved in repairing water damage, and appears fairly substantial.  The Scope of Works referred to “installation and supply of internal linings eg gyprock and villaboard”, but this did not identify just how much of this was to be installed.  On the evidence it is not clear whether this was additional work, or originally contemplated by the contract; sheeting the inside of the concrete block walls did not appear in the owners’ list of jobs to be done.  It appears from the list of variations attached to the builder’s email of 26 February 2017 that some, perhaps all, of this was included in the claim made then for an extra $3,000 for the plasterer.^[66]  If so, it was included in the work for which the owners allowed an extra seven days.  The problem here is that the Scope of Works was vague, and the builder has not proved that this really was additional work, or has not been covered by the owner’s allowance.  In those circumstances, no allowance should be made for this. 
76. [76]
    As well, all that was said in the schedule was that the work was done over the period 1 December to 10 February, which is not helpful.  There were also claims about removing blind or curtain fittings from walls to enable this to proceed, which also seems reasonable if this was extra work, although these would not have taken very long in themselves.  Finally the documents included some payments, which are not relevant for present purposes. 
77. [77]
    The real problem with all these claims however is that the provision in the General Conditions of Contract (Exhibit 4) Clause 32 defines the entitlement by reference to the end of the “building period”.  That is defined in Clause 38.1 as the number of days stated in item 13, which was 63, “as extended by clause 17.”  Clause 17 provided a mechanism for the builder to obtain an extension of time in various circumstances, including a variation requested by the owner, but the process was to be triggered by the builder giving a written notice to the owner of the extension of time within a certain period.  In circumstances where no such written notice was ever given by the builder, there necessarily cannot be any extension of time “by clause 17.”  Accordingly the building period remained 63 days, document 47a does not assist the builder, and the Member was correct in his allowance of late completion damages.  This aspect of the builder’s appeal fails.  For that reason, it is not necessary for me to make findings about how long an extension was justified by anything in document 47a.  
78. [78]
    The builder also argued that some of the additional work included in document 47a involved costs which were included in the amount of costs claimed by the builder under the heading “Various items required for the build” referred to in the reasons of the Member, [22].  It is true that a claim on that basis was not considered by the Member, but the difficulty for the builder is that this matter was not advanced before the Member as a claim for additional expense associated with a variation to the work to be done requested by the owners.  The builder did not advance at the hearing a claim for additional expense on the basis that he had to incur that expense because of additional work; his claim was based on his having a “do and charge” contract, and that claim failed.  It is now too late to advance a different, and unparticularised, claim on a different basis.  To consider it now would be a denial of natural justice to the owners. 

Other matters

79. [79]
    The balance of the builder’s submissions dealt with the consequences of the various challenges to the decision of the Member, and the issues of costs and interest.  The builder’s claim for $39,310.79 was made up of eight specific claims, of which three succeeded before the Member.  These were the claims for the carpets $1,826.80, the shower screen $1,108.80 and the patio guttering $891, a total of $3,826.60.  As well, in the counter-application the owners conceded that there were six variations from the contract which produced amounts owning to the builder, totalling $11,334.40.  Only two of these overlapped the builder’s list, the carpets and the patio guttering, and in each case the amount the owners conceded was different from the amount the builder claimed.  The Member resolved these differences by adopting the owners’ figure for the carpets, $3,326.80, and the builder’s figure for the guttering, $891.   
80. [80]
    The Member also allowed in favour of the builder the other four variations in his favour conceded by the owners.  These were the apron and path $369; repair of water damaged bathroom $3,458; additional plastering $3,000; and replacement of rear door, $300.  To that he added $16,159.53 as the final payment due under the contract on practical completion, but I regard that as an error, as it should not have been allowed.  Omitting that, the amounts allowed in favour of the builder were:

    1. (a)
       Carpet $3,326.80
    2. (b)
       Sliding Shower Door and Glass $1,108.80
    3. (c)
       Patio guttering $891.00
    4. (d)
       Apron and Path $369.00
    5. (e)
       Water Damage Bathroom $3,458.00
    6. (f)
       Additional plastering $3,000.00
    7. (g)
       Replacement Rear Door $300.00
    8. (h)
       TOTAL $12,454.20
81. [81]
    I agree with that figure, as the amount properly recoverable by the builder on his claim against the owners.  Turning to the counter-application, the amount claimed by the owners as payable to them in respect of the contract was $18,291.10, made up of reimbursement of $11,340 paid by them for the shed kit which they said was covered by the contract, and five items which they said were included in the contract but were not done by the builder, totalling $6,951.10.  The Member allowed the claim for the shed kit, and for three of the other five items, disallowing claims for credits for a laundry tub and for bi-fold doors.  Of the three items which were allowed by the Member, the only one challenged on appeal by the builder was the allowance for the exterior painting, and that challenge failed.  I do not agree with the Member’s conclusion about the shed kit, and as a result consider that the amount properly allowed on this part of the counter-application, for the exterior painting, the vanity basin and mirror and the QLeave allowance, was $5,716.10.^[67] 
82. [82]
    The counter-application also claimed, and the owners were allowed, the cost of replacing some vertical blinds, $2,666, which was not contentious, and liquidated damages for delayed completion, $2,750.  Claims for loss of income by Mrs Lohmann and for legal costs both failed.  The builder’s challenge to the damages for delayed completion has failed.  Adding these two successful claims to the amount allowed in respect of variations, $5,716.10, produces a total payable to the owners on the counter-application of $11,132.10. 
83. [83]
    The result of the appeals therefore is that the net amount in favour of the builder of $6,141.63 has been shown to have been incorrect.  The correct balance in favour of the builder is $1,322.10.  I understand that after the decision of the Tribunal the owners paid to the Tribunal Trust Account the amount of that decision in connection with their appeal.^[68]  From the money held by the Tribunal Trust Account, $1,322.10 is to be paid to Ian Clark Jaques, and the balance of $4,819.53 is to be paid to Graham J Lohmann and Meryl C Lohmann, with any accretion to be divided pro rata between them. 

Costs

84. [84]
    The Member made no order for costs of the proceedings in the Tribunal.  This decision was challenged by the builder on the appeal.  The question of legal costs in relation to proceedings in the Tribunal is governed by the QCAT Act s 100, s 102.  I set out my views on the operation of these provisions in Marzini v Health Ombudsman [2020] QCAT 365.  A later decision of mine applying those views is the subject of an application for leave to appeal to the Court of Appeal, but so far as I know leave has not yet been given, and I adhere to the views I expressed in Marzini.  In essence, the Act provides that no order is to be made for costs unless the Tribunal finds that the interests of justice require such an order, in which case a discretion arises, and the Tribunal may have regard to certain matters set out in the Act. 
85. [85]
    The Member also referred to the provisions of the 1991 Act s 77(h).  That provides that one of the powers of the Tribunal, in dealing with a building dispute is to “award costs”.  It has been held that this operates to exclude the provisions of s 102 of the QCAT Act, so that there is a general discretion to award costs, which however must be exercised judicially: Lyons v Dreamstarter Pty Ltd [2012] QCATA 71 at [6] – [8], a decision of the then President who went on to say at [11] that there was High Court authority that the discretion starts with the proposition that it is just and reasonable that a party who causes another to incur costs should reimburse the other party for them; otherwise the factors affecting the discretion will vary in each case. 
86. [86]
    The Member noted that each party had had some success in their respective claims, and that there was no question of justice which favoured either party, so that the usual result that no party has to pay the other’s costs should apply.  The builder challenged that outcome, but in the circumstances as an exercise of the discretion under the QCAT Act it cannot be faulted, whether considered by reference to the outcome before the Member or the outcome on appeal.  Overall the builder has had some success, but only to the extent of a small part of his initial claim, and the main issue in dispute between the parties, the terms of the contract between the builder and the owners, was resolved in favour of the owners. 
87. [87]
    The difficulty however is that the discretion should have been exercised under the 1991 Act.  The Member referred to both provisions and did not make it clear when discretion he was exercising, although his reference to the “usual provision” suggests that it was the provision in the QCAT Act.  If so, that was an error of law.  It is therefore necessary for me to exercise the discretion afresh.  In the circumstances, I should take into account the changes in the decision of the Member resulting from the appeals. 
88. [88]
    One aspect of costs orders is that, if the builder is awarded the costs of his application and the owners the costs of their counter-application, the traditional approach to assessment would see the owners receive limited benefit from the order in their favour, since it would carry only those costs specifically referrable to the counter-application.  Such an approach would therefore not reflect the overall outcome of the proceeding, or the respective degrees of success in the matters litigated.  In particular, it would not reflect the fact that the major issue in dispute was resolved in favour of the owners, as were most of the other matters in dispute.  Indeed, had it not been for amounts conceded by the owners although not claimed by the builder, there would have been no overall balance in his favour.  In all the circumstances, approaching the matter in the way indicated by the former President, I consider that it is appropriate to make no order as to the costs of the proceeding before the Member. 
89. [89]
    It may be that the builder has done very badly financially out of this contract; I cannot really tell if that was the case, but if he has, it was because, confronted with a client who needed a fixed price contract, he fixed a price which was too low, drafted a written contract in such a way as to leave unclear just what was covered by it and what was not, and then did not administer the contract in the way required by its terms.  This however does not give rise to any justification for an order for costs.^[69]   There is no reason to interfere with the actual decision not to make an order for costs in favour of the builder. 

Interest

90. [90]
    The builder on the appeal also challenged the decision of the Member not to allow interest.  As the Member pointed out, the written contract provided in clause 33.1 that the builder “may” charge the owner interest from the day on which an amount falls due to be paid up to and including the day on which it is paid.  The contract schedule provided that a rate could be specified, but one was not, and as a result the contractual rate of interest was 18% per annum. 
91. [91]
    The Member regarded this as high, having regard to prevailing commercial interest rates: [187].  There are higher rates around; for example, some credit cards charge a higher rate on unpaid balances from month to month, although some people regard them as too high also.  The real concern of the Member, however, seems to be that, so far as the owners were entitled to recover on the counter-application, the only interest they would recover would be at a much lower commercial rate, presumably under a statute: [189]. 
92. [92]
    On appeal the builder in effect sought that some interest, although at a much lower and more reasonable commercial rate, be allowed anyway.  The difficulty with a claim for interest under the written contract is that all of the amounts on which the builder is entitled to succeed, as set out in [70] above, are for additional work.  The builder did this additional work, but it was not dealt with under the terms of the written contract as variations,^[70] so the builder’s claims for that work are really not claims under the written contract, but on a quantum meruit.  Accordingly there was no entitlement to interest under the written contract at 18% per annum, or any other rate.  In respect of his claims, the builder is in the same position as the owners. 
93. [93]
    In relation to interest, that is not a particularly satisfactory position.  The 1991 Act s 77 makes no provision for the Tribunal to include interest in any order it makes for the payment of money owing.  There is a power in s 77(3)(c) to award interest on “damages” as prescribed under a regulation, but the builder’s claims were not for damages, and this applies only to interest after the amount of the damages became payable.^[71]  The QCAT Act provides a general discretionary power to award interest (except where interest is payable anyway) but only in minor civil claims, those for not more than $25,000, which was not this matter.  The Civil Proceedings Act 2011 (Qld) s 58 confers a power similar to that in s 14 on a “court”, but that means only the Supreme Court, the District Court or a Magistrates Court: s 4.  I have not been able to locate any provision authorising the Tribunal to allow interest on the amount ordered to be paid in this matter.  At common law there is no such discretionary power; either there is a contractual right to interest, or (in limited cases) interest can be awarded as a form of damages, or it is just not payable.  In the circumstances, the Member was correct not to order the payment of interest, and this aspect of the builder’s appeal must be dismissed. 

Costs of the appeals

94. [94]
    That leaves the question of the costs of the appeals.  I proceed on the basis that s 77(3)(h) of the 1991 Act applies to the Appeal Tribunal.  The owners were successful in their appeal, but the builder did not oppose that outcome at the hearing.^[72]  The builder was successful on only one of the issues argued by him, but it involved the largest single amount in dispute in that appeal, and it was contested by the owners.  Both parties were not legally represented in the appeals, and I expect that neither party has been given leave under the QCAT Act s 43(2)(b) to be legally represented.  I have not heard submissions as to costs of the appeals, so all I can do is express a provisional view.  That is, that each party has had a measure of success in the appeals overall, and a measure of failure, and in all the circumstances the fairest course is to make no order as to the costs of either appeal. 
95. [95]
    If any party wants to contend that some other order should be made as to the costs of the appeals, that party should file and serve on the other party written submissions in support of the order sought within twenty-one days of the decision on the appeals.  If that occurs, the other party can then file and serve written submissions in opposition within twenty-one days of the service of such submissions.  If those submissions contend for some other order as to the costs of the appeals, the first party may file and serve within twenty-one days written submissions in reply.  Otherwise, my provisional view will stand.