Skinner & Skinner v Queensland Building Tribunal & Szabo
[1996] QDC 326
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- Unreported Judgment
- Skinner & Skinner v Queensland Building Tribunal & Szabo[1996] QDC 326
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Skinner & Skinner v Queensland Building Tribunal & Szabo[1996] QDC 326
Skinner & Skinner v Queensland Building Tribunal & Szabo[1996] QDC 326
DISTRICT COURT | Appeal No 138 of 1995 |
CHAMBERS
JUDGE ROBIN QC
ANTHONY & FRANCE SKINNER | Appellants |
and
THE QUEENSLAND BUILDING TRIBUNAL | First Respondent |
and
ELMER FERENC SZABO | Second Respondent |
BRISBANE
DATE 26/02/96
JUDGMENT
HIS HONOUR: The Queensland Building Tribunal established under the Queensland Building Services Act has been established to facilitate resolution of “domestic building disputes”. The notion is to establish an expert tribunal armed with broad general powers to do justice which are amplified by provisions for mediation and the like.
An appeal (about which little is said to clarify its nature) lies to a District Court by leave under section 94. The nature of that appeal has been recently considered by Judge Brabazon QC in Queensland Building Services Authority v. Progressive Enterprises Pty Ltd, Plt 246/96, reasons for judgment delivered 10 January 1996.
In this matter the Chief Judge has granted leave to appeal. Whether leave should be given was one of the questions in the case before Judge Brabazon. It is not a question before me. The Chief Judge's order was made on 17 October 1995.
The Court, given its wide general jurisdiction, lacks the expertise which members of the Tribunal may be presumed to have in the area of domestic building disputes. Whereas the Tribunal doubtless frequently encounters disputes in which both sides are lay people representing themselves, that situation, which pertains in the present appeal, is extremely embarrassing for a Judge.
It is almost inevitable that the Judge will create the appearance of descending into the arena when the inexperience of self-represented people makes it necessary that assistance in identifying and presenting an appropriate case is necessary if a matter is to be dealt with at all. The papers which I have seen indicate that the Tribunal and Court Registry staff have felt embarrassment along those lines in getting this appeal as far as it has gone.
I hope that in future something can be done so that the Court is not confronted with bulky and apparently disorganised material from the Tribunal, much of which is replicated. It has not been easy to locate the relevant material - even such basic documents as the Tribunal's ruling appealed against which was made on 31 August 1994 at Cairns.
Apropos of that geographical observation, I am told by Mr Skinner who is representing the other appellant, his wife, as well as himself, there being no objection to that, that he has been informed that the District Court at Cairns does not entertain appeals or applications for leave to appeal in domestic building disputes, although the Registry in Cairns offered him some assistance.
I have not had the opportunity yet to verify whether this is correct and, if so, ascertain the reasons for it but it seems to me undesirable if litigants are forced to Brisbane which in the present case is certainly a remote and inconvenient venue. The Tribunal itself appears to have a presence in Cairns.
I would think the ordinary principle having regard to the philosophy underlying the Act is that ordinarily leave to appeal against determinations of the Tribunal would not be forthcoming.
It is easy to understand why the Chief Judge granted leave in this case. Mr and Mrs Skinner had the misfortune when they wished to have a residence erected at Port Douglas that they elected to engage the services of Mr Szabo, who lacked the appropriate registration as a builder under the Builders' Registration Act - which was the legislation in force at the relevant time.
A contract between the two sides was made on 23 September 1993 in writing. I am not in a position to say to what extent Mr and Mrs Skinner might have contributed to their own misfortune. They seem to have had only limited connection with this jurisdiction at the relevant time.
It is difficult to see what justification Mr Szabo would have had for entering into a contract for substantial residential construction. It emerged fairly quickly when the local authority refused to grant an approval required of it that Mr Szabo was not registered to do the work. The work could not commence. Mr Szabo then found a registered builder, G K Mullins Pty Ltd, which entered into a similar written contract dated 23 October 1993. This one bears the imprint of the company's “gold card”.
It adopted the same fixed price of $75,612 (incorporating $1,312 “provisional sums”) as the contract with Mr Szabo had. I have observed during the hearing today that it would seem somewhat fanciful to conclude that the involvement of the company could have been procured without some substantial reward to it. The material includes what appears to be a receipt from the company to Mr Szabo acknowledging receipt of its fee for supervision.
There are addenda to the Mullins contract which, unlike the contract itself, bear Mr Szabo's signature as well as Mr and Mrs Skinner's and the company's. That addendum material seeks to define the respective roles of the company and Mr Szabo who appears to have assumed responsibility for payment of the reward the company expected.
I have seen material produced in other proceedings in the Tribunal in which the principal of the company asserts that its taking over of the contract depended on the subcontractors found by Mr Szabo sticking to their prices. I am not sure whether that was in the end a problem in the execution of the works.
Mr Skinner has told me that one of the problems was the disappearance of a considerable amount of valuable rosewood timber from the site which he had brought down from Papua New Guinea. There is a contest as to who bears responsibility for that and insurance issues arise too, I am told.
Matters proceeded, according to what Mr Skinner has told me from the Bar table, on the basis that he was anxious to honour the second building contract by making payments to the company but was talked into making payments to Mr Szabo direct. Mr Mullins' company did, on what I am told from the Bar table, play an active role in “supervising” the work, at least to the extent of giving Mr Skinner an opinion as to whether or not progress payments ought to be made. He says he fell in with the notion of paying Mr Szabo direct because Mr Szabo was physically closer, the company having its principal operations on the Atherton Tableland. The house being constructed is at Port Douglas. It has never been completed.
At some point, Mr Szabo found himself excluded from the site and further involvement in the contract and the company took it over. Mr Szabo makes it perfectly clear today in what he has said that he regards Mr Mullins as responsible for this and responsible for cheating him out of his opportunity to carry out building work for profit.
The proceedings before the Tribunal resulted in a determination that Mr Szabo who was the applicant in application number C078 of '94 should be paid $850, which was a sum including some interest component to bring Mr Szabo's receipts from the Skinners up to an identified portion of the contract value. Substantial moneys had already been paid in the sum of $26,903.70. The Tribunal decided Mr Szabo's entitlement “on a quantum meruit basis” was $27,724.40.
The proposition that Mr Szabo was entitled to recover on a quantum meruit was based on Pavey and Matthews Pty Ltd v Paul (1987) 162 CLR 221. The Tribunal said:
“I find that the builder did complete the base and about one-third of the frame section of the works. I think the owners would be unjustly enriched if they did not pay the builder $27,724.40, being the agreed progress payments for the deposit base stage and the value of one-third of the frame stage, which I would calculate at $8,821.40.”
It is far from clear to me that an automatic application of Pavey and Matthews is appropriate, having regard to the strong terms of the Queensland legislation in section 53 of the Builders' Registration Act which was enacted following the High Court decision. I refer to the judgment of White J in Mostier Constructions Pty Ltd v. David Leonard Cox and Others, Writ 514 of 1990, unreported reasons for judgment 22 February 1993. The hearing of the matter before her Honour was on 8 February 1993. It followed shortly after her Honour had joined the President in a joint judgment in the Court of Appeal in Pohlmann v. Harrison and Another, Appeal No 103 of 1993, unreported judgment delivered 3 February 1993. The Court of Appeal judgment appears to proceed on the basis that Pavey and Matthews applied with little being said in the reasons about the precise terms of section 53(2)(d). On the face of it, it is not easy to reconcile what was said in the paragraph in the joint reasons running from page 6 to page 7 with her Honour's approach in the later case which was that a quantum meruit might be open in the face of section 53 to protect an unregistered builder's entitlement to recover outlays and cost of materials, but her Honour was emphatic it did not cover an unregistered builder's work otherwise. I don't have access to the full factual details underlying the two authorities to explain any difference, but it could well be that Mr Pohlmann was a registered builder, unlike Mr Szabo.
It is unlikely, I think, that if no more had been in issue than an order that Mr Szabo be paid $850, the Chief Judge would have given leave for this appeal to be brought. The Tribunal went further and came to the conclusion which is expressed in the reasons that the contract between Mr and Mrs Skinner and G K Mullins Pty Ltd “was a sham and the real contract was between” the Skinners and Mr Szabo. This determination was made in the absence of any participation by G K Mullins Pty Ltd which was not a party and apparently in the face of Mr and Mrs Skinner's communication to the Registrar of 16 February 1994, Exhibit 22 before me, that they considered that “Greg Mullins' evidence at this hearing is of paramount importance”.
The direct consequence of the Tribunal's determination which may well not have been anticipated by the Tribunal has been that G K Mullins Pty Ltd has denied it is under any contractual obligation to Mr and Mrs Skinner. As might have been anticipated, the company, on the basis of difficulties with the completion within budget of the job it had taken over, declined to proceed and the Skinners began proceedings C300 of '94 against G K Mullins Pty Ltd seeking to force the company to complete the work. By a process I don't quite understand, the Skinners have become respondents in those proceedings and the company the applicant. A further respondent is Mr Szabo.
Those proceedings are a suitable vehicle in which the matters in controversy which involve all three parties may be resolved. The Tribunal, in the reasons, notes that Mr and Mrs Skinner have, to date, not served their own cause well in the sense that they have failed to provide any detail of counterclaims that they might have for defective work against either or both builders.
The Tribunal seemed to apprehend that there may well be a good claim against Mr Szabo in particular but the lack of supporting detail meant that the counterclaim issues had to wait for resolution on another occasion.
The authority appears to take advantage of the Tribunal's decision to deny that Mr and Mrs Skinner have insurance cover in respect of the residence, although the authority has presumably been willing to receive a premium leading to the issue of its certificate of insurance for the work dated 1 June 1994 which names G K Mullins Pty Ltd as the contractor.
The Chief Judge's concern to ensure that Mr and Mrs Skinner, as the “consumers” in the picture, obtain full justice is manifest. At the moment, Mr and Mrs Skinner are left without a registered builder to claim against as a result of a determination in proceedings in which the company played no part either as a litigant or even a supplier of evidence.
Similarly Mr and Mrs Skinner have no access to insurance protection which they might well have expected. This whole dispute seems to me a nightmare for all concerned from almost every point of view.
It is particularly difficult for the Court to comes to grips with in a hearing in Chambers with the participants representing themselves. Mr Szabo has assured me that he had nothing to do with the Tribunal's determination that the Skinners' contract with the company was a sham or a nullity and indeed, before me, is still asserting it was a legal contract.
Section 95 of the Queensland Building Services Authority Act, particularly in subsection (3), makes it clear that it was open to the Tribunal to join the company in the proceedings adjudicated upon. I think that ought to have been done.
It was a strong thing from the point of view of G K Mullins Pty Ltd's standing as a registered builder for the Tribunal to determine in proceedings not involving it that it had been a party to a sham and abused its gold card in the process. Conclusions along those lines would seem to be inherent in what the Tribunal has said.
Although it is possible, under section 94(4), for this Court to make an appropriate determination, there is no possibility of that happening in proceedings to which G K Mullins Pty Ltd is not a party. Such proceedings do exist, C300 of '94 in the Tribunal. Those are still at an interlocutory stage.
In my opinion, what this Court ought to do is annul the Tribunal's determinations in respect of the declaration of sham. That is essentially on the basis that G K Mullins Pty Ltd was not a party and that evidence of Mr Mullins or other principals or officers ought to have been considered.
In respect of that part of the order which entitled Mr Szabo to be paid $850, my reading of the reasons is that order very much followed the making of the determination of sham and ought to fall with it.
Further, the Court of Appeal and Supreme Court authorities I have mentioned indicate that where a quantum meruit is claimed by a builder who, for some reason, is debarred by section 53 of the Builders Registration Act or some other legislation from obtaining payment, it is not necessarily a simple matter of applying Pavey and Matthews to order the quantum meruit.
I do not purport to have made any final examination of or determination of facts, which would hardly have been possible on a Chambers day; days would be required. In the circumstances it is neither necessary nor useful to embark on fact finding or even the question whether the Tribunal's decision was justified by the evidence (whatever that may have been) before the Tribunal.
I propose to remit the case to the Tribunal for further hearing or rehearing and consider it is also appropriate under section 94(3)(c) to make an order or give a direction that the proceedings be heard with C300 of 1994.
It is most important that both builders be represented in the proceeding so that Mr and Mrs Skinner aren't at risk of “falling between two stools”, as the expression goes.
I have said nothing yet about the presence of Miss Mott of counsel representing the Tribunal. She is here in consequence of the Tribunal's apprehension that Mr and Mrs Skinner may be seeking costs against the Tribunal.
It is identified in the notice of appeal as the first respondent and the orders sought, according to the notice of appeal, include 1 : that the respondents pay the appellant's costs of and incidental to the appeal to be taxed. I have invited Mr Skinner to indicate to me some statutory or case authority supporting the proposition that the Tribunal is liable to pay costs, without result. I would have thought that, as a dispute resolving entity, the Tribunal was not at risk of having orders for costs made against it simply because an appeal succeeded. Without deciding whether or not the outcome might be different if the Tribunal could be shown to have acted in bad faith, I will note that there has not been any suggestion and nor do I think there could be that anything remotely resembling that has occurred.
Reading the Tribunal's reasons of 31 August 1994, it appears to me that the Tribunal was attempting, in a reasoned way, to produce a fair and just resolution to the dispute before it. It is unfortunately the case, however, that the way in which the Tribunal dealt with what turns out to have been only a part of a much larger controversy produced a decision which has had the untoward and probably unexpected consequences averted to above which I surmise were the basis of the grant of leave to appeal.
I am just wondering what to do about costs. Mr Skinner, I do not propose to order the Tribunal to pay costs. There is a real problem about costs on the basis of what Mr Szabo has told me which, at least for today's purposes, I accept, because the Tribunal seems to have produced a bad result without any blame attaching to him.
MS MOTT: Your Honour, perhaps I might be of some assistance. It is a matter which has only just occurred to me but there may be some authority that the appeals cost fund -----
HIS HONOUR: Yes, I was wondering about that too.
MS MOTT: I have a case here which I was going to submit to you if Your Honour was minded to make an order as to costs where the Court found that a Tribunal had actually been biased in its determination but decided not to award costs but did make orders pursuant to the appeals cost fund -----
HIS HONOUR: I am not suggesting the Tribunal was biased in the least. What is that authority?
MS MOTT: Your Honour, I don't know if it's the best authority on the appeals cost fund point. I'm simply explaining the circumstances of the case but it's a case decided by Mr Justice Shepherdson in the Supreme Court of Heilbronn.
...
HIS HONOUR: In relation to costs, with the assistance of Ms Mott for which I am grateful, I will make an order that the appeal be allowed with costs. I make an order that both Mr and Mrs Skinner, on the one hand, and Mr Szabo on the other, are entitled to a certificate under the Appeal Costs Fund Act and I will note Mr and Mrs Skinner's undertaking not to pursue Mr Szabo personally for costs which are not covered by the Appeal Costs Fund.