Queensland Building Services Authority v Wyatt
[2002] QDC 326
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- Unreported Judgment
- Queensland Building Services Authority v Wyatt[2002] QDC 326
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Queensland Building Services Authority v Wyatt[2002] QDC 326
Queensland Building Services Authority v Wyatt[2002] QDC 326
DISTRICT COURT OF QUEENSLAND
CITATION: | Queensland Building Services Authority v Wyatt [2002] QDC 326 |
PARTIES: | Queensland Building Services Authority (Appellant) and Byron Wyatt (Respondent) |
FILE NO/S: | D1192 of 2002 |
DIVISION: | District Court, Brisbane |
PROCEEDING: | |
ORIGINATING COURT: | Queensland Building Tribunal |
DELIVERED ON: | 9 December 2002 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 8 October 2002 |
JUDGE: | Skoien SJDC |
ORDER: | Appeal allowed in part. |
CATCHWORDS: | Whether appeal from Building Tribunal a re-hearing in the traditional sense – category 1 and 2 defects – exercise of discretion. |
COUNSEL: | P J Davis for the appellant F G Forde for the respondent |
SOLICITORS: | Atherton Lawyers for the respondent |
- [1]This is an appeal from a decision of the Queensland Building Tribunal brought pursuant to s.92 of the Queensland Building Tribunal Act 2000 (“the QBT Act”).
- [2]The appellant is a statutory body incorporated under the provisions of the Queensland Building Services Authority Act 1991 (the “QBSA Act”) and the respondent is a builder who holds a licence under the QBSA Act.
- [3]On 16 August 2001, the appellant issued Direction to Rectify 22850 (“the DTR”) pursuant to s.72 of the QBSA Act. The DTR directed rectification of building work in five particulars, three of which are presently relevant and are set out in para [19] below.
- [4]A review of the DTR was sought pursuant to s.104 of the QBT Act and, as a result, four aspects of the DTR were challenged.
- [5]Over four days between 4 and 11 February 2002, the Queensland Building Tribunal (“the Tribunal”) heard the application for review by the respondent and on 27 February 2002 the Tribunal set aside the DTR in relation to all four defects.
- [6]The appellant appeals that decision pursuant to s.92 of the QBT Act but seeks the reinstatement only of the DTR in the three respects set out in para [13] below.
Nature of the Appeal
- [7]S.92 of the QBT Act relevantly provides:-
“92(1)A party to a proceeding before the tribunal may appeal to the District Court against a decision of the tribunal that finally decides matters the subject of the proceeding.
…..
(3)An appeal must –
(a)be accompanied by the tribunal’s decision and reasons for decision, if any; and
(b)refer to the tribunal’s decision and reasons for decision, if any, and any other relevant material and state the grounds for the application.
(4)The appeal is by way rehearing, unaffected by the tribunal’s decision, on the material before the tribunal and any further evidence allowed by the District Court.
…
(6)On an appeal, the District Court may do any of the following –
(a)confirm, annul, vary or reverse the tribunal’s decision; or
(b)remit the case to the tribunal for further hearing or rehearing; or
(b)make consequential or ancillary orders or directions.”
- [8]The first point to be decided is the nature of the appeal, the difficulty arising from the extraordinary insertion in subsection (4) of the phrase “unaffected by the tribunal’s decision”, a phrase which would seem to negate the description of the appeal as being by way of rehearing.
- [9]My task has been made easier by the fact that His Honour Judge McGill has recently delivered reasons in Pointon v Redcliffe Demolitions Pty Ltd [2002] QDC 131, in which he carefully and comprehensively examined the authorities. He concluded (and I respectfully agree with him) that what is intended by s.92 is an appeal by way of rehearing in the ordinary sense. Accordingly, the onus is on the appellant to show that there was something wrong in the decision. Further, since the decision was based on findings of primary fact involving the credibility of witnesses, the appellant faces the particular difficulty of overcoming the advantages of the Tribunal which has seen and heard the witnesses.
- [10]To the extent that the appeal challenges the exercise of a discretion exercised by the Tribunal, it seems to me that the test must be the same. There is a strong presumption that the discretion has been correctly exercised and it will be overturned only if the appeal court is satisfied it is clearly wrong. A description of the sorts of errors which can give rise to success on appeal is contained in House v The King (1936) 55 CLR 499 at 504-5. While McGill DCJ did not need expressly to reach this conclusion in Pointon, it seems to me to be quite clear from his reasoning that he would have.
Background
- [11]By contract dated 18 March 1998, the respondent contracted with Mr and Mrs Samson to carry out renovations and extensions to a dwelling at 6 Wattle Street, Ascot. Mr and Mrs Samson never resided in the dwelling. They sold it to Ashleigh Morgan Pty Ltd on 26 February 1999. Ms Brooks is the sole director of Ashleigh Morgan Pty Ltd. She lives in the dwelling with her partner, Mr Auslebrook.
- [12]In a dispute notification form dated 9 August 2000, Ashleigh Morgan Pty Ltd complained to the appellant. The dispute notification form identified two major alleged defects related to window mouldings and cracks in the external wall. One of the other complaints related to non-functioning air conditioning.
- [13]Ultimately on 16 August 2001, the appellant issued DTR 22850, the subject of these proceedings. It directed the respondent in these proceedings to undertake rectification work to deal with five issues, of which three are presently relevant:-
“(a)Upper and lower levels internal ducted air conditioning shows evidence of inadequate installation resulting in uneven airflow throughout the rooms and insufficient cooling capacity.
(b)All external elevations – “Hardie-tex” product sheeting shows evidence of excessive surface cracking in several locations due to lack of expansion provisions to accommodate movement. The surface cracking is allowing water to penetrate causing moisture to migrate to internal structural framing.
(c)All elevations – external window surrounding mouldings show evidence of insufficient weather sealing causing excessive water/moisture entry, resulting in the moulding deterioration at the interface between the external sheeting and the underside of the window mouldings.”
- [14]The Tribunal member conducted a view of the dwelling on 1 February 2002, heard evidence over four days and, after receiving submissions, gave judgment on 27 February 2002, ordering that DTR 22850 be reversed and further ordering the present appellant to pay the present respondent’s costs.
The Law
- [15]The objects of the QBSA Act are:-
“(a)to regulate the building industry -
(i)to ensure the maintenance of proper standards in the industry; and
(ii)to achieve a reasonable balance between the interests of building contractors and consumers; and
(b)to provide remedies for defective building work; and
(c)to provide support, education and advice for those who undertake building work and consumers.”
and “consumer” is defined in the Dictionary (Schedule 2) to mean “a person for whom building work is carried out, but does not include a building contractor for whom building work is carried out by a subcontractor”.
- [16]The current owner (Ashleigh Morgan Pty Ltd) is obviously not a “consumer” so s.3(a)(ii) has no application. While the point was not expressly adverted to by the Tribunal nor by counsel before me, these proceedings would seem to be within the objects set out in s.3(a)(i) and s.3(b).
- [17]Section 72(1) of the QBSA Act provides:
“72.(1) If the authority is of the opinion that building work is defective or incomplete, the authority may direct the person who carried out the building work to rectify the building work within a reasonable period stated in the direction.”
The word “defective” is given an extended definition in the Dictionary of the QBSA Act to include “faulty or unsatisfactory”. I note the use of the permissive “may” which demonstrates that the authority has a discretion to exercise once it has reached the opinion that the work is defective or incomplete.
- [18]As a guide to the exercise of that discretion, s.72(14) of the QBSA Act provides:
“(4)The authority is not required to give a direction under this section to a person who carried out building work for the rectification of the building work if the authority is satisfied that, in the circumstances, it would be unfair to the person to give the direction.”
- [19]Derrington J in R v His Honour Judge Miller and the Builders Registration Board of Queensland Ex parte Graham Evans and Co (Queensland) Pty Ltd [1987] 2 Qd R 446 at 458 stated:-
“where his [the builder’s] adherence to the contract must mean defective work, the answer to the builder’s dilemma is that the legislature has reposed confidence in the board to determine in this specific case whether an order should be made; and the board, in exercising that discretion properly, must in a proper case recognise the builder’s innocent position and afford him protection by exercise of its discretion in his favour. In some circumstances, there is obvious need for protection of the owner even though the builder may be able to point to a term of the contract justifying the defective result, while in others, the builder may be perfectly justified in confirming with the specifications and should not be required to remedy the defects. Such a discretion is both reasonable and logical in this field where it is so difficult to set precise criteria where a number of different factors will operate in varying degrees”
While this case does not involve protection of a contracting owner but of a consumer, those remarks are nevertheless a helpful guide.
- [20]When conducting an application for review pursuant to section 105 of the QBSA Act the tribunal stands in the shoes of the authority and can exercise its powers in the light of all of the evidence available to it, including fresh evidence (Queensland Building Services Authority v Carey (1997) QDC 162 (Brabazon DCJ).
- [21]In Queensland Building Services Authority v Gary Norwood Homes Pty Ltd (unreported, District Court, 20 June 1997) Forno DCJ listed a number of principles relating to the exercise of the discretion by the Tribunal on an application to review. These include:
- (a)The standard that must be applied in deciding whether or not a direction is appropriate is the standard laid down in Briginshaw v Briginshaw (1938) 60 CLR 336.
- (b)The tribunal may take departmental policy into account, as it stands in the shoes of the decision maker, on the basis that the public and responsible builders are entitled to expect that the authority will issue directions to rectify strictly in accordance with, and with an adequate understanding of, the requirements of the Act.
- (c)The tribunal should take into account the information before it, including whether or not the builder has been at fault and whether or not the owner has been at fault. However, the process is not simply one of deciding whose fault it is that work is unsatisfactory and therefore defective. His Honour noted that there would be cases where the tribunal would need to decide the matter at hand according to policy considerations, when neither the building nor the owner could be said to be at fault (see R v His Honour Judge Miller and the Builders’ Registration Board of Queensland (1987) 2 Qd R 446).
- [22]As the Tribunal member correctly noted, the departmental policy to which Forno DCJ referred is the policy (made under ss.9(a), 9A of the QBSA Act) published in the Government Gazette on 9 December 1994. The policy relates to the exercise of the discretion conferred by section 72 of the QBSA Act by reference to the passage of time relative to the degree or scale of the defect. The policy creates two categories of defect, those about which a direction will normally be issued and those about which a direction will not normally be issued.
- [23]The category of defects about which a direction will normally be issued is further subdivided into category 1 defects, being those which may:
- allow water penetration into a building;
- adversely affect the health and/or safety of the occupants;
- adversely affect the structural adequacy of the building;
- adversely affect the serviceability, performance or functional use of the building or work;
- [24]Category 2 defects are those defects which:
“result from failure of the contractor to meet reasonable standards of construction and finish;
- are of a kind which commonly occurs during the “settling in” period of a new building.”
- [25]The policy states that category 1 defects should be notified to the authority within three months of the defect becoming apparent, but in any case not later than six years three months after completion of the work.
- [26]The policy states that category 2 defects should be notified to the authority within six months following completion of the work, with a note being made that the authority will not normally issue a direction when the work has been completed for more than seven months.
- [27]It has been held that the good and workmanlike standard to be expected of a builder is an objective standards but not independent of the circumstances in which the work is carried out, including constraints imposed by the builder’s client (Francis v Building Services Corporation (unreported, Commercial Building Tribunal New South Wales, 3 July 1993)).
Credibility of Witnesses
- [28]The Tribunal member expressly found the respondent to be an honest witness and clearly preferred his evidence to that of the homeowners, particularly Ms Brooks.
- [29]Despite the fact that the previous homeowners (Mr and Mrs Sampson) were the sister and brother in law of the respondent, a fact noted by the Tribunal member, it is clear that their evidence was regarded as acceptable by her.
- [30]The Tribunal member expressly preferred the evidence on technical matters of Mr Locke, a very experienced air conditioner contractor (but without formal qualifications) to that of Mr McLaughlin, who designed the air conditioning system. While the Tribunal member accepted the evidence of Mr Douglas as an architectural expert, she expressed the caution that the opinions offered by him were sometimes based on assumptions which were not supported by the facts as the Tribunal member found them.
Air Conditioning
- [31]The air conditioning system was designed with one zone for upstairs and a second zone for downstairs. The complaints related to its alleged inability to cool upstairs.
- [32]The appellant’s case was that the air conditioning unit was:
- (a)too small to cool the dwelling; and/or
- (b)improperly installed in that there was no insulation in the ceiling or the roof and the ducting was too long.
- [33]I turn first to the question whether the Tribunal member was wrong in finding that there was no defect in the air conditioning system. This appears clearly enough from paras [62] and [68] of the reasons of the Tribunal member.
- [34]At the outset, I have difficulty in understanding the finding of the Tribunal member at para [68] that Mr McLaughlin’s evidence was that he installed a system which was capable of operating effectively, within the budget, if it were properly maintained. He did say that he was working to a budget, and he did say that, if no maintenance service is provided for three years, there would undoubtedly be problems with the system. But nowhere did he say that the system was capable of operating efficiently nor explain what that expression would convey to him. What he did say (T237/15) is that air conditioning should reduce a 39°C outside temperature to an inside 29°C temperature but he was clearly speaking generally, not of this particular unit. So, in my view, para [68] of the Tribunal member’s reasons contains a serious error of fact.
- [35]Mr McLaughlin’s evidence is hard to assess because it was frequently unresponsive to the question and often argumentative. He did, however, concede points which I would have thought to be self evident, that roof and ceiling insulation and ceiling height are all relevant matters. He also made it clear that he designed the system from floor plans only, without the benefit of elevations and that he has never serviced the system other than once to have a faulty zone motor replaced.
- [36]The Tribunal member expressly accepted the expertise of Mr Locke, who is very experienced in the air conditioning trade. He did not investigate the servicing of this unit which he said involved cleaning the filter on a “reasonably regular basis depending on your location”. However, when he looked at the installed system, he saw no signs which would suggest the need for cleaning the filter and he gave his opinion that the unit was operating to its capacity. “It was doing the best it could.” In my view, there was not satisfactory evidence that lack of service of the air conditioner played any part in this matter.
- [37]Mr Locke used a computer programme called CAMEL which he said was widely used in the industry to design the appropriate type of unit to be installed in a location. His conclusion was that, even with insulation to the roof and the ceiling, a 22.5 kilowatt capacity system would be needed. The installed unit has a capacity of 18 kilowatts. With the roof and ceiling uninsulated (as is the case here), the maximum design load would increase to 26.9 kilowatts. Thus, on his expert evidence (his expertise being accepted by the Tribunal member) the air conditioning unit was seriously undersized for the job.
- [38]At para [59] of the reasons, the Tribunal member says that the CAMEL programme is an appropriate design system, a finding which is clearly supported by Mr Locke’s evidence. She then says that the use of the programme is not mandatory which is true, but I fail to see what it adds to the debate. She then says that the output of the CAMEL programme is only as good as the data entered into it. That is, again, undoubtedly true, but again I fail to see its relevance. She does not say in what respect the input data on this use of the programme was defective nor, as I read the evidence, was any such inadequacy investigated, let alone established. Mr Locke’s statement, exhibit 14, identified the data used as input and that was not challenged in his oral evidence.
- [39]I have even greater difficulty in accepting the Tribunal’s finding that Mr Locke said that, when the Brisbane outside temperature exceeds 32°C, he would expect any air conditioning system to struggle. To my mind that would be an extraordinary statement from an expert in the field on a subject which is within the common experience of the majority of local residents who, even if they do not themselves own a domestic air conditioner, would at least have experience of their efficiency. Such units are reasonably common in houses and are regularly found in motel rooms. The Brisbane summer average maximum (according to Mr Locke) is 32°C and that is what the units are designed for (T329/5-10). They should be able to reduce the temperature inside to 25°C (T319/15; T334/25). It defies both logic and common experience to say that an outdoor temperature of more than 32°C (without quantifying that increase) would cause an air conditioner to struggle.
- [40]Indeed, the Tribunal member’s finding seems to be based on a literal adoption of an answer given by Mr Locke (T329/20). But one must look at the whole passage (all questions being asked by the Tribunal member) which is (T329/5-25):-
“So, I’m sorry, I don’t understand that. Do you mean to say if the air conditioning system has to cope with a range of outside conditions that range from 32 degrees dry-bulb ---? --- Yes.
--- to 23 degrees wet-bulb ---? --- Yes.
--- so that’s the range of outside possibilities? --- That’s the maximum of the outside possibilities that we design to.
They’re the extremes? --- Yes. No, that is – no, that’s the maximum that you would design to. Now, if the temperature increases outside ---
All right, so it can be 40 outside? --- It can be 40. Then most air conditioners would battle.
Right. And it could be 10 outside and you wouldn’t need your air conditioner at all? --- Yes, yes, that’s right. Yes, well, you’d have it on heating.
Well – so, if the outside temperature is over 32 ---? --- Yes.
--- no matter what system you’ve got, you don’t think that it’s – or to use your words, it would be struggling? --- Yes. As the outdoor temperature rises, so you’d expect not a correlation but an increase in indoor temperature.
Right? --- And the reason we do that is 32 is the average temperature in summer in Brisbane.
Sure? --- We wouldn’t go and – but we know we have 38, 40 degrees days in Brisbane as we had over Christmas, but we don’t go and design an air conditioner to do that because that’s a couple of days a year. You design it for a mean average and the mean average is 32 degrees, so that’s what we design it to.”
and at T331/1-15 (questioned by counsel for the authority):-
“MR DAVIS: This relationship between the internal temperature and the external temperature, assuming that the air conditioning unit is of the right size, should it be able to shift the internal temperature no matter what the external temperature is? --- Yes.
Right. So, looking back at your heat loads, you’ve got your 26.9 kilowatts, you said earlier that you couldn’t relate that to a temperature as such ---? --- A temperature fluctuation.
--- because that depends on the ambient temperature outside? --- That’s true.
So, no matter what the ambient temperature is outside, the unit if it’s working, should cause a fall in the temperature inside? --- It should.”
- [41]I am confident that what Mr Locke was saying was that when the outside temperature is extremely hot (for example, 40°C), the air conditioner would “battle” to cool the inside to the desired extent, that is, down to 25°C. But he actually says that the increase would not “correlate”, that is, for each degree over 32°C outside, there would not be an increase inside by the same number of degrees. And when read in context, it is impossible to take the word “yes” as being an unequivocal affirmative answer to the Tribunal member’s suggestion that, when the outside temperature is over 32°C, the unit would be struggling. Witnesses very frequently say “yes” to indicate that the question has been heard and understood and, in my opinion, that was clearly the case here.
- [42]At no time in his oral evidence did Mr Locke resile from the opinion he expressed in his statement, exhibit 14, that the air conditioning unit was not capable of cooling the top floor of the premises under selected design conditions, i.e. 5 January. Nor did he resile from his opinion that the unit was seriously undersized.
- [43]In the light of that evidence which confirmed the complaints of the present occupiers, one might have expected the appellant authority to succeed in this air conditioning ground. However the Tribunal member preferred to make a finding based on her own experience on her inspection of the house. The reasons for decision include the following:-
“61When I attended the view I was asked to observe a clock in one of the bedrooms which indicated on a digital readout that the temperature was 28º. I have no idea of the accuracy of that ‘thermometer’. The air conditioning system was then activated by Mr Aulsebrook. I returned to the room after approximately 25 minutes having completed the view. Despite the fact that the digital readout was unchanged, the room was appreciably cooler than it had been 25 minutes earlier.
62Using what Mr Locke, the air conditioning expert, regards as the best gauge of the effectiveness of an air conditioning system and taking into account that no measurement was made of the temperature outside the premises (a day of forecast 31 maximum), I find that on the day of the view the air conditioning system functioned effectively.
63In forming this conclusion I also take into account the fact that the air conditioning unit installed was chosen in part because it met the budget of Mr and Mrs Samson.
64I am not persuaded otherwise by the evidence of the ‘test’ carried out by Mr Aulsebrook (exhibit 26). His test had no regard to the air temperature outside the house, did not prove that the thermometer he used was accurate and is silent on whether the room felt cooler. Mr Aulsebrook is a financier and readily conceded he had no expertise in building, much less in air conditioning.”
- [44]Without wishing to be hyper-critical of the Tribunal member, it seems to me that her dismissal of Mr Aulsebrook’s evidence was a little harsh. As to the outside temperature, his statement, exhibit 26, records that the test took place on 31 January between 9.15 am and 10.30 am. It was not put to him that there was, at the time, anything extraordinary about the weather so one can quite safely assume that it is very unlikely that the outside temperature exceeded 32ºC. Then, it does not take expertise in building or air conditioning to read a thermometer. As to proof of the accuracy of the thermometer, two things can be said. First, a thermometer is a relatively simple device which, in ordinary experience, gives readings of sufficient accuracy for day to day requirements. A thermometer may be inaccurate (just as a speedometer, a set of kitchen scales or a clock might) but witnesses regularly give evidence of speeds, weights, times etc. by reference to these devices and unless there is reason to believe that the device is inaccurate the evidence is considered acceptable. Second, and importantly, the temperature recorded by the thermometer did not alter at all. One would expect even an inaccurate instrument to register a drop in temperatures if in fact the room cooled. Then, to comment adversely on the fact that Mr Aulsebrook did not say whether the room felt cooler is curious. Had it indeed felt cooler to him, his silence would have been a conscious attempt to mislead the Tribunal and no such finding was made. Indeed his evidence on the test, to my mind, is consistent with the evidence of Mr Locke that the unit is seriously deficient in capacity.
- [45]The passage in para [61] of the Tribunal member’s reasons set out what is obviously the reason why she concluded that the air conditioning unit functioned effectively. It was her experience that (the thermometer reading being unchanged) after the 25 minutes of the view the room felt appreciably cooler than it had been before the view.
- [46]The Tribunal member also clearly relied upon Mr Locke’s evidence that personal comfort is the real test of the efficiency of an air conditioner. That is obviously true in the sense that a person who feels comfortable does not care whether the temperature is, say 25°C or 26°C, but that does not contradict his clear evidence that this unit was not of sufficient capacity effectively to cool the upper floor.
- [47]I was told by Mr Davis of counsel (without objection) that the 25 minute view was conducted outside the house. The Tribunal member says the forecast maximum for the day was 31ºC, that is, it was a warm to hot day. It would be surprising if the room did not feel cooler than it had before she exposed herself to outside temperatures. The member does not quantify the extent to which she felt cooler. She does not say it was comfortably cool. In my view such a subjective assessment could not reasonably establish the efficiency of the air conditioner and could not reasonably justify rejecting the expert evidence of Mr Locke.
- [48]I have thus identified a number of errors in the approach adopted by the Tribunal member. It is my opinion that the evidence and the weight of evidence clearly established a defect relating to the air conditioning.
- [49]The Tribunal member then said that in any event the defect (if found) would have been a category 2 defect. Mr Davis urged that an inefficient air conditioner fell within category 1 because it may “adversely affect the …. functional use of the building”. Mr Forde of counsel for the respondent argued the contrary, submitting that it was merely a luxury item and that the house was fully usable and functional with or without it. Indeed he argued that it was not even a category 2 defect.
- [50]I agree with Mr Forde’s submission that it was not a category 1 defect, but I find it to be a category 2 defect. It results from a failure of the respondent “to meet reasonable standards of construction”. The installation of a grossly inadequate air conditioner cannot accord with reasonable standards of construction.
- [51]That having been found, ought a DTR issue with respect to the air conditioner? That involves the exercise of a discretion.
- [52]The Tribunal member made it clear that even if it were a category 2 defect she would have exercised her discretion in favour of the respondent. The reasons she listed were that the respondent was given a budget by the then homeowners (the consumers) and installed an air conditioning unit within that budget. The actual design and installation was not done by the respondent but by an experienced and qualified sub-contractor. The notification of a defect was made outside the 6 months (or 7 months) period laid down in the policy (indeed it was made after some 20 months). She expressly disavowed any dishonesty by the original consumers.
- [53]To that one could add that, despite the wording of the objects of the QBSA Act (see paras [15] and [16] above), it would seem to be an odd result if the purchasers of a house who took it “as is” could in effect seek redress, not from their vendors, but from the vendors’ builder if a luxury item such as an air conditioner were defective, even seriously defective like this one. As the Tribunal member noted it would not have been difficult to have the efficiency checked at the contract stage. Mr Locke’s CAMEL programme would have quickly demonstrated that the unit was defective.
- [54]Thus, on the question of the exercise of discretion (assuming a defect to be found) the Tribunal member did not err. I similarly exercise my discretion in favour of the respondent and decline to reinstate the air conditioning DTR.
External Surface Cracking
- [55]The appellant’s case before the Tribunal was that:
- (a)The external cladding boards had been improperly affixed to the building in that there were no expansion joints and the boards had been butted together;
- (b)Movement in the boards resulted in cracking in the surface material along the joints between the boards;
- (c)The cracks opened up so that over time water will be absorbed into the studs and will flow down the studs at the bottom place skirting.
- [56]The approach taken by the Tribunal member, put shortly, was that there was no unequivocal evidence “of water penetration from outside”. Had there been such evidence she would have found a category 1 defect (para [76] of her reasons).
- [57]With respect, that is not according to the policy, the terms of which I have set out in para [23] of these reasons. The material qualification for a category 1 defect is that it may allow water penetration into the building. The reason for that is quite obvious. Water penetration is a serious defect in a building the consequences of which can extend far beyond nuisance value. That was the evidence of Mr Douglas, the architect whose expertise was accepted by the Tribunal member, who said it would lead to rotting of the pine studs and ultimately adversely affect the structural adequacy of the walls.
- [58]The evidence that the cracking of the outer sheeting may lead to water penetration was all one way. The respondent himself conceded it as a possibility. A possibility is something which may happen. Mr Douglas explained the mechanism whereby water affects a building frame (T344/1-5). He then said “the potential for water entry was quite strong in those cracks” (T391/5). In other words, in his view it was more than a mere possibility; it may very well happen.
- [59]Mr Kirwin, the authority’s inspector, gave evidence consistent with previous water penetration in the external wall of the laundry (T420/15-25). He did not recall it as being then damp but unless the penetration had been recent it would not be expected to be damp. It had a musty smell, he said. The Tribunal member said in her reasons (para [86]) that the reason for that could have been the presence of dog beds nearby, a proposition that Mr Kirwin was not asked to comment on.
- [60]Mr Douglas gave evidence of seeing evidence of water penetration in the study external wall (T350/10) and the powder room (T357/25). He also gave evidence of possible other areas (T347/20-25).
- [61]It is true that Mr Douglas conceded the possibility that water could have come from sources other than the outside via the cracking (para [80] of the Tribunal reasons). A positive identification of the source of water damage can really only be made when the event is either occurring or is very recent when the inspection is made. But here the real point is that he identified (and did not resile from) the external sheeting cracks as a likely cause. His evidence established clearly that the cracking may allow water penetration and pointed to two examples consistent with it having actually happened. A category 1 defect is thus shown and, as I have said, it was confirmed by the concessions made by the respondent (see, for example, T248/5-10). The finding of the Tribunal to the contrary is therefore wrong.
- [62]It must be remembered that, short of removing external or internal cladding or cutting numerous inspection holes, it would not usually be possible to identify more than one or two actual areas of penetration. That has been done here and further, the evidence shows that those areas are consistent with the penetration having come from the external cracks. There could well be more, possible many more such areas.
- [63]Should the discretion then be exercised to allow the DTR to stand? Mr Forde put two main arguments on behalf of the respondent. First, he said, no actual damage has been shown to have occurred. But, as I have said, it may simply not have been discovered and will not be excluded until proper investigation is made, as it will on repair. Second, he said that it may not be possible to match the cladding. That, to me, seems a relatively minor matter compared with the possibility of future structural damage.
- [64]Some 22 months passed between the completion of the renovations and complaints regarding the workmanship. That is quite a delay but is well within the period laid down in the policy for a category 1 defect.
- [65]Unlike the air conditioning unit, there is no suggestion that the cracking which, on the evidence, resulted from improper fixing of the sheeting without expansion joints is in any way related to the respondent being required to keep to a particular budget.
- [66]Unlike the air conditioner, the outer sheeting of a house is not a luxury item. It is essential to the ordinary enjoyment of a dwelling house that it remains structurally sound. And again, unlike the air conditioner, it is not something which a prudent purchaser would normally think of having checked by an expert. And in contrast to the remark I made in para [53], I would not regard it as odd that the QBSA Act and policy would protect a purchaser from the original consumer in respect of a defect of this potential seriousness. It would be quite contrary to the object of the Act and the policy made under it to permit a potentially structurally unsound building to stand unrepaired.
- [67]I decide therefore to exercise my discretion to reinstate this part of DTR 22850.
Window Surround Mouldings
- [68]The appellant’s case in relation to this defect was as follows:
- (a)The window surrounds were constructed by a polystyrene moulding coated by a thickness of resin to give a hard surface;
- (b)The moulding were then fixed to the house with adhesive;
- (c)Here the mouldings were not properly affixed with the result that water is able to penetrate behind the mouldings and ultimately into the house.
- [69]The architect, Mr Douglas, gave uncontested evidence in relation to the method of fixing the mouldings onto the hardiflex boards. His evidence was that the boards should be fixed to the house; the moulding should then be adhered to the boards with an adhesive; the joints between the boards should then be taped; the coating system should then be applied to the boards; a bead of sicaflex would then be applied to both the external and internal perimeters of the moulding; part of the installation of the window includes the installation of the flashing as described on page 10 of the Hardiflex Fixing Manual which is part of Mr Douglas’ statement (exhibit 16). He said (T340/25-30; T341/1) that flashing of windows was essential.
- [70]Mr Douglas’ opinions are set out in his report (exhibits 16 and 17) and also his evidence (T372-376), namely that there are poor joints between the pieces of moulding making up the window surroundings; that cracking can be seen along the butt joint above the removed section of the moulding; that there is evidence of water penetration behind the mouldings and that the moulding has not been properly sealed with a sicaflex bead on the internal or external perimeters of the moulding.
- [71]His uncontested evidence was further that the relationship between the defect with respect to the moulding and the defect in respect of the fixing of the boards was that the crack opens along a butt joint above the moulding and water penetrates through the coating and through the butt joint; that the water then travels down behind the board; and, as the water passes behind the board it also of course passes behind the moulding and any water barriers that are on top of the final finish (e.g. the sicaflex bead).
- [72]Mr Douglas’ opinion, which was not contradicted by any satisfactory evidence, was that the defective moulding could (i.e. “may”) lead to water penetration (T373-5). Thus, the defect is a category 1 defect. Indeed, the possibility of water penetration is made even more likely by the absence of flashing, which the respondent conceded to be a defect which may allow water penetration (T281/15-20). The Tribunal member erred in failing to make that finding even though (para [112]) she appears to accept Mr Douglas’ evidence on the point. At para [72], she appears simply to decide not to allow this DTR to continue because “there is no uncontroversial evidence of such water penetration despite the passing of years”.
- [73]This topic then becomes indistinguishable from the topic of the external surface cracking and for the reasons there expressed I find that this defect is a category 1 defect.
- [74]In an apparent reference to the exercise of her discretion (which was not really enlivened, given her failure to find a defect of either category) the Tribunal member refers to “significant repair cost” and “damage (to) surrounding work which is not otherwise defective”. While these are relevant, they do not outweigh the factors to which I refer in paras [63] to [66] above.
- [75]I decide therefore to reinstate this part of DTR 22850.
Conclusion
- [76]The appeal is allowed to the extent that paragraphs 4 and 5 of DTR 22850 are reinstated. I give liberty to apply if it is thought necessary or desirable to vary the wording of these paragraphs, for example, to lay down a time within which the rectification should be carried out.
- [77]The result of this appeal has been in favour of the Authority on the two most serious defects with which the Tribunal had to deal. However, much of the appeal was taken up with the question of the air conditioner on which the respondent succeeded. I would therefore order that the respondent pay two-thirds of the costs of the appellant of this appeal to be assessed or agreed. However, I defer a final decision on this until I have read the letter which is said to be attached to an affidavit of Chris Anderson (which is not on the Court file).
- [78]As to the costs of the Tribunal hearing, I take into account the fact that, while the appellant obtained the leave of the Tribunal to appear by counsel, the respondent chose to represent himself. It is unlikely that the Tribunal was led into error by the sophistication of the argument put forward by the respondent. I take into account the fact that, in the upshot, the respondent succeeded on two of the four points before the Tribunal. I also take into account the disparity in resources between the parties. I would therefore order that the respondent pay one-half of the professional costs of the Authority and all of the witness expenses related to the issues under paragraphs 4 and 5 of DTR 22850, such costs and expenses to be assessed or agreed.