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Hestbay Pty Ltd v One Sector Pty Ltd[2024] QSC 180

Hestbay Pty Ltd v One Sector Pty Ltd[2024] QSC 180

SUPREME COURT OF QUEENSLAND

CITATION:

Hestbay Pty Ltd v One Sector Pty Ltd [2024] QSC 180

PARTIES:

Hestbay Pty Ltd 

(Plaintiff)

v

One Sector Pty Ltd

(Defendant)

FILE NO/S:

9563 of 2021

DIVISION:

Trial – Civil 

PROCEEDING:

Claim 

ORIGINATING COURT:

Supreme Court of Queensland

DELIVERED ON:

22 August 2024

DELIVERED AT:

Brisbane

HEARING DATES:

9 – 13 October 2023

16 – 17 October 2023

30 November 2023

1 December 2023

JUDGE:

Ryan J

ORDER:

The plaintiff’s claim is dismissed.

The defendant’s counterclaim is allowed in part.

The parties are to confer and produce a draft order which gives effect to my findings within 14 days.

I will hear the parties, and the third party, Excel Concrete Pty Ltd, as to costs.  

CATCHWORDS:

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – THE CONTRACT – GENERALLY – where the plaintiff engaged the defendant to construct an industrial warehouse with a concrete slab floor – where the slab floor deteriorated – where the plaintiff alleged that the defendant had constructed a deficient slab, not in accordance with its contractual specifications – where the plaintiff alleged that the defendant added too much water to the cement mix during the pour of the slab, causing it to be understrength and of insufficient surface hardness – where the plaintiff alleged that the slab was too thin at spot locations – where the plaintiff alleged that the slab was not fit for purpose – whether the contract was breached – whether any breach was inconsequential/de minimus – turns on its own facts.

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – THE CONTRACT – GENERALLY – where the parties contracted between themselves (without lawyers or project managers) – where the parties focus was on a series of Tender Letters, which set out the detail of the work to be performed and its cost but which did not include broader contractual terms – where the parties did not sign a contract – where the parties disagreed about whether the Australian Standards design and construct contract terms applied – turns on own facts.  

EVIDENCE – ADMISSIBILITY – OPINION EVIDENCE – EXPERT OPINION – GENERALLY – where the plaintiff relied upon the evidence of an expert engineer – where the expert’s opinion was based on identified factual assumptions – where those factual assumptions were not proven by admissible evidence – where the defendant did not apply to exclude the evidence of the plaintiff’s expert – weight to be given to expert evidence where factual assumptions not proved.

Alexander v Cambridge Credit Corp Ltd (1987) 2 NSLR 310, considered

Bellgrove v Eldridge (1954) 90 CLR 613, considered

Build Qld Pty Ltd v Pro-Invest Australian Hospitality Opportunity (ST) Pty Ltd [2022] QCA 266, cited

Elliott v Lawrence [1966] Qd R 440, cited

Hestbay Pty Ltd v One Sector Pty Ltd [2023] QSC 154, noted

McGhee v National Coal Board [1973] 1 WLR 1, considered

PQ v Australian Red Cross Society [1992] 1 VR 19, cited

R v Gibson [2022] QCA 151, applied

R v Naidu [2008] QCA 130, applied

Sanrus Pty Ltd & Ors v Monto Coal 2 Pty Ltd & Ors (No 7) [2019] QSC 241, applied

SHA Premier Constructions Pty Ltd v Niclin Constructions Pty Ltd [2019] QCA 201, cited

Stockland Property Management Pty Ltd v Cairns City Council [2011] 1 Qd R 77, cited

Stone v Chappel (2017) 128 SASR 165, considered

Tabcorp Holdings Ltd v Bowen Investments Pty Ltd (2009) 236 CLR 272, considered

COUNSEL:

S B Whitten & C Matthews for the plaintiff

M D Ambrose KC & Dr A Greinke & S Lamb for the defendant

SOLICITORS:

Hickey Lawyers for the plaintiff

Doyles Construction Lawyers for the defendant

Summary7

Preliminary comments11

Context13

Concrete and its strength13

The concrete in this case13

Strength testing14

Slump14

Australian Standards relevant to the slab’s construction16

Authoritative documents other than Australian Standards23

Concrete Institute of Australia: Recommended Practice: The Evaluation of Concrete Strength by Testing

Cores23

The Z11 document23

BS EN 13791:201928

European Standard EN 1992 -1-1 Eurocode 228

National Construction Code Series 201529

The parties and early negotiations31

The warehouses’ purpose32

Warehouse completion, occupancy and maintenance33

The Stage 1 contract34

The engineers’ specifications for the concrete slabs38

The leases40

Tenants’ complaints about the Stage 1 and Stage 2 slabs42

Viadux (Stage 1)42

Chempro (Stage 1)42

EZFurn (Units 10 and 11, Stage 2)43

Budget Pet Products (Units 12 and 13, Stage 2)45

Budget Pet Products (Unit 9, Stage 2)48

Hestbay’s investigation of, and response to, the complaints49

Mr Ray’s observations of the Stage 2 units50

Unit 950

Units 10 and 1150

Units 12 and 1350

Hestbay’s claim in brief52

One Sector’s response in brief54

Testing of the Stage 2 slab in 202255

The Stage 2 contract57

The concrete used in Stage 269

Flawed comparison between the Stage 1 and Stage 2 slabs73

Expert engineering evidence76

Plaintiff’s expert: Dr Scott Woolcock77

Report 28 August 202277

Defendant’s expert: Dr Inam Khan91

Report 6 April 202391

Defendant’s expert: Mr Lindsay Reid99

Report 26 April 202399

Dr Woolcock in reply102

Report 6 July 2023102

Dr Khan in reply to Dr Woolcock’s report105

Report 29 August 2023105

Mr Reid in reply to Dr Woolcock’s report report107

Report 4 September 2023107

Defendant’s expert: Mr Robert Munn report report109

Report 5 April 2023109

Units 10 and 11109

Unit 9110

Units 12 and 13111

Mr Munn supplementary report (in response to Dr Woolcock’s report)114

1 September 2023114

Joint report115

Valuation evidence127

Main Issues131

Issue 1:  Whether the contract terms were those in an AS4902 – 2000 Design & Construct sent by the plaintiff on 10 July 2015, or the terms of what the defendant says is its “Commercial Contract”, which the plaintiff had a copy of as of 23 March 2016? 133

Issue 2:  Whether the slabs in Stage 2 are defective because of durability and strength problems, including by exhibiting degradation to parts of the surface, cracking in various areas and excessive dusting?136

Issue 3:  If the contract was the AS 4902 contract, was the defendant aware of the purpose of the slabs, and if so, whether the slabs as constructed were “fit for purpose”, given that was required by cl 2.2(a) of that contract?138

Issue 4:  Whether the slabs were constructed in breach of the terms specified on either version of the contract, which specified the depth and strength of the concrete to be constructed?141

Issue 5:  If so, were those breaches the effective cause of the [plaintiff’s] loss and damage, or were the defective durability and strength problems caused by the tenants using non-pneumatic tyres on the flooring? 

 155

Issue 6:  Whether rectification is required, and if so, which of the Options 1, 2 or 3 identified by Dr Woolcock are reasonable and necessary?164

Counterclaim170

Inconsistent contractual terms 172

Qleave 174

Piling and piering 174

The rock wall 175

Appendix 1177

Leases and Tenants 177

Appendix 2178

Vehicles in use 178

Summary

  1. [1]
    Hestbay engaged One Sector to design and construct an industrial warehouse complex with a concrete slab floor in two stages, Stage 1 and Stage 2.  After the complex was completed and tenanted, tenants complained about the state of the slab floor in Stage 2.  Hestbay asserted that One Sector constructed a deficient Stage 2 slab, causing Hestbay loss and damage.  
  2. [2]
    Hestbay asserted that the primary reason for the deficient Stage 2 slab was that One Sector added too much water to the cement mix during the pour of the slab, resulting in its being under-strength, or having an insufficiently hard surface, causing it to crack, deteriorate, and generate excessive dust.  Hestbay also complained that the Stage 2 slab was not of its required thickness.
  3. [3]
    Hestbay brought a variety of claims against One Sector, including for breach of contract in failing to construct the slab in accordance with its specifications; and in failing to construct a warehouse which was fit for purpose because: (a) it was not fit for use by tenants of all kinds using pneumatic or non-pneumatic tyred vehicles; and (b) spot failures in the thickness of its slab did not allow tenants to put walls anywhere within the warehouse.  
  4. [4]
    One Sector asserted that there was nothing wrong with the Stage 2 slab – even if more than the prescribed amount of water had been added to the cement mix during its pour. Hestbay was unable to prove that: (a) the slab was not built to its specifications; (b) the addition of excess or uncontrolled water to the cement mix during its pour led to its damage; (c) it was not of the thickness required; nor (d) that it was not fit for its purpose.  The slab was designed for pneumatic tyred vehicles only.  Any damage to it was caused by Hestbay’s tenants using non-pneumatic (or hard-wheeled) vehicles on it.  Further, One Sector counterclaimed against Hestbay for three amounts said to be owing under the contract.    
  5. [5]
    With respect to Hestbay’s claim, the parties identified the issues for me at the beginning of the hearing.  At the end of the hearing, I re-framed the issues so that they better aligned with the way in which the case had been conducted.  The table below briefly states my conclusions on the issues, as re-framed by me. 
  6. [6]
    I found that, although One Sector may have breached its contract with Hestbay, the breaches were inconsequential; and the evidence did not persuade me that it was more probable than not that those breaches caused damage to Hestbay.  It follows that Hestbay’s claim is dismissed.

Issue as drafted by the plaintiff, pre-trial.

Issues as re-framed by me post-trial.

Brief statement of my response.

  1. Whether the contract terms were those in an AS 4902-2000 Design & Construct sent by the defendant to the plaintiff on 10 July 2015, or the terms of what the defendant says is its “Commercial contract”, which the plaintiff had a copy of as of 23 March 2016?

What contractual terms governed the design and construction of Stage 2?

The contract terms for Stage 2 included those contained in AS4902-2000 and the Tender Letter of 23 May 2015 itself.  Both of those documents were included in the contractual documents sent to the plaintiff on 10 July 2015.  

This led to inconsistency between some of the contractual terms.

I found that the terms of AS4902-2000 applied only to the extent that they were not inconsistent with the terms expressly agreed by the parties, including those spelt out in the Tender Letter.  

One Sector’s terms and conditions did not apply.

  1. Whether the slabs in Stage 2 are defective because of durability and strength problems, including by exhibiting degradation to parts of the surface, cracking in various areas and excessive dusting?

Were the Stage 2 slabs defective, in that they were exhibiting degradation, cracking and excessive dusting?

I proceeded on the basis that the Stage 2 slab was defective in that it was exhibiting degradation, cracking, and excessive dusting.  The critical question was

“why?”.

  1. If the contract was the AS4902 contract, was the defendant aware of the purpose of the slabs, and if so, whether the slabs as constructed were “fit for purpose”, given that was required by cl 2.2(a)(iv) of that contract?
  1. What was the intended purpose of the Stage 2 slab – stated or otherwise?
  1. Would the Stage 2 slab’s specifications render it fit for its purpose?
  1. Was the Stage 2 slab built to its specifications?
  1. Mr Hutchins engaged Mr Ray to build the sort of warehouses that he had built before on a speculative basis – that is a warehouse like the 100 he’d built since 2009, all of which specified slabs of 32 MPa.  Slabs of that strength were suitable for “general industrial use” or a “broad range of industrial uses”.  

I did not find that the Stage 2 slab’s intended purpose included its being able to accommodate hard-wheeled vehicles.

  1. Yes.
  1. See Issue 4.
  1. Whether the slabs were constructed in breach of the terms specified on either version of the contract, which specified the depth and strength of the concrete to be constructed?

Was the slab built to its specifications as to its – 

(a)  strength;

(b)  sthickness;

(c)  slump; and

(d)  water to cement ratio?

  1. The defendant’s contractual obligation was to construct a slab which was of a characteristic compressive strength of 32 MPa at 28 days after its pour.  It was more probable than not that the slab was not quite of a characteristic compressive strength of 32MPa at 28 days after its pour.  It was more probable than not that the slab was of a characteristic compressive strength of 32 MPa at practical completion.
  1. Thickness was to be calculated as per 15.3.3 of the CCAA Guide to Industrial Floors and Pavements.  Whether it was compliant with its specification was to be determined as per 15.2.4 of the Guide.  There could be no testing as per 15.3.3 because the cores taken were not the right size.  Thus, I could not determine compliance.  If I “made do” with the cores available, their average and characteristic thickness exceeded 175mm and the slab met its thickness specification.  However, on a “spot failure” approach, it did not. 
  1. No.  
  1. There was no evidence about the water to cement ratio of the mix when it left the supplier.  Therefore, one could not determine what the water to cement ratio was at any relevant point in time.
  1. If so, were those breaches an effective cause of the plaintiff’s loss and damage, or were the defective durability and strength problems caused by the tenants using non pneumatic tyres on the flooring?
  1. Was the addition of uncontrolled water an effective cause of damage to the slab?
  1. Did the thickness of the slab render it unfit for purpose?
  1. I was not satisfied that it was more probable than not that the addition of uncontrolled water to the Stage 2 slab at pour was the cause, or an effective cause, of the damage to the slab.
  1. No. 
  1. Whether rectification is required, and if so, which of the Options 1, 2 or 3 identified by Dr Woolcock are reasonable and necessary?

Not applicable, because of my findings on Issues 1 – 5.

  1. [7]
    With respect to the counterclaim, I found that Hestbay owed One Sector for the cost of the Qleave and piling and piering – but not for the rock wall.  It follows that One Sector’s counterclaim is allowed in part.
  2. [8]
    My reasons in detail follow.  
  3. [9]
    The parties are to prepare a draft order which gives effect to my findings within 14 days.
  4. [10]
    I will hear the parties and the third party, Excel Concrete Pty Ltd,[1] as to costs.  

Preliminary comments 

  1. [11]
    I found it difficult to make confident findings of fact about the state of the Stage 2 slab and the extent or seriousness of its deterioration, cracking, and dusting. 
  2. [12]
    Stage 2 of the warehouse complex included Units 9 – 13.  By the time of its inspection for the purposes of this trial, the whole of the slab in Unit 9 and the trafficked areas of the slab in Units 12 and 13 had been covered with an epoxy coating.  Thus, none of the slab in Unit 9 and very little of the slab in Units 12 and 13 could be examined by experts for the purposes of this litigation.[2] 
  3. [13]
    The slab in Units 10 and 11 was uncoated and, at least in theory, provided the best evidence of the state of the slab, but the evidence about its condition was inconsistent, for example: 
    1. The most independent witness – the tenant of Units 10 and 11 – considered the dusting of the slab that he experienced to be “in the nature of the business”.  
    2. The plaintiff’s expert, Dr Scott Woolcock, considered the dusting to be so excessive as to amount to a health hazard.
    3. Two of the defendant’s experts observed no dusting at all.
  4. [14]
    Nevertheless, when considering what caused the damage to the Stage 2 slab (its deficient construction or hard-wheeled vehicles), I was prepared to proceed on the basis that it was damaged beyond that which would be expected with ordinary wear and tear had it been traversed only by pneumatic-tyred vehicles.  
  5. [15]
    Even though the evidence about it was vague and non-expert, I was prepared to proceed on the basis that the Stage 1 tenants’ use of the Stage 1 slab was similar to the use of the Stage 2 slab by the Stage 2 tenants, including in their use of similar, hard-wheeled vehicles, at similar intensity, and with similar loadings, during their diverse business operations.   
  6. [16]
    Even though the evidence about it included little more than the impressions of lay witnesses, I was prepared to proceed on the basis that the Stage 1 slab was performing better than the Stage 2 slab.  
  7. [17]
    Evidence from four engineers took up most of the reading and hearing time in this matter.  
  8. [18]
    My reasons reveal my concerns about the evidence of the plaintiff’s engineering expert, Dr Scott Woolcock, including (but not only) because – 
    1. his approach to the issues was primarily theoretical.  He did not link his opinions to the facts of the case.  For example, his opinion about the effects of the addition of uncontrolled water on the slab was not supported by an examination of cores taken from the slab which did not reveal any sign of over-watering.
    2. he was not a concrete technologist, which explained his limited understanding of the way in which concrete hardened in wet versus dry conditions. 
    3. he made several admitted errors in his evidence.  
  9. [19]
    Additionally, the factual foundation for critical aspects of Dr Woolcock’s opinion was not established by admissible evidence.  In offering his opinions, Dr Woolcock assumed that: (a) the Stage 1 slab had been constructed in accordance with its specifications (which were almost the same as the specifications for the Stage 2 slab);[3] and (b) that no uncontrolled water had been added to the Stage 1 cement mix during the Stage 1 slab’s pour.  On that basis, Dr Woolcock concluded that the Stage 1 slab performed better than the Stage 2 slab (under similar conditions of use) because uncontrolled water had been added to the Stage 2 slab during its pour.  Dr Woolcock concluded that it could not have been the hard wheeled vehicles of the Stage 2 tenants which were damaging the slab because hard wheeled vehicles had not damaged the Stage 1 slab.  But the assumptions made by Dr Woolcock about the way in which the Stage 1 slab had been constructed were not proven by admissible evidence.  
  10. [20]
    The failure to prove the factual assumptions which underpin an expert’s opinion renders the opinion liable to exclusion.  As explained R v Naidu,[4] “It is unquestionably the law that expert opinion evidence is inadmissible if the opinion is not expressed upon a state of facts both identified and proved in evidence”.  
  11. [21]
    However, the defendant did not object to the admission of Dr Woolcock’s evidence to the extent to which it relied upon assumed facts which had not been proven.  In those circumstances, it was for me to determine what weight to give it – see Naidu at [80].
  12. [22]
    Further, there was evidence that the slabs had been reinforced differently – which Dr Woolcock said might explain why the Stage 1 slab performed better, even on the assumption that uncontrolled water had been added to the Stage 2 slab only.
  13. [23]
    To the extent to which Dr Woolcock’s opinion relied upon assumptions which were not proven, I gave it no weight.  
  14. [24]
    As will emerge in my reasons, evidential shortcomings in the plaintiff’s case, such as those discussed above and others, prevented me from finding in its favour on the critical issues.

Context 

  1. [26]
    Before embarking on an outline of the evidence which I considered significant, it is important to put some context around the factual issues.
  2. [27]
    One of the primary factual issues for me was whether One Sector constructed the Stage 2 slab in accordance with the engineers’ specifications.  Another was whether the slab was, in effect, “strong” enough and thick enough, to be fit for its “purpose”.  
  3. [28]
    What “strength” meant; what the slab’s “purpose” was; and how to measure “thickness” were also issues for me.

Concrete and its strength 

  1. [29]
    Speaking in very broad terms, concrete is a mix of cement and water (plus aggregates or admixtures) which hardens over time because of a chemical reaction between the cement and the water.  
  2. [30]
    As concrete hardens over time, it becomes stronger.  How long concrete will continue to harden and how strong it ultimately becomes depends on several variables, including the environment in which it has been placed and the water available to it in that environment.  
  3. [31]
    The compressive strength of concrete is a measure of the amount of force required to crush it in megapascals (MPa).  
  4. [32]
    The stronger the concrete, the greater its resistance to abrasion and joint breakdown.  
  5. [33]
    The characteristic compressive strength of a concrete structure is the strength below which not more than 5% of it is expected to fall.  Determining the characteristic compressive strength of a concrete slab requires the taking of several samples from the slab; testing their individual compressive strengths; and calculating therefrom (by way of statistical analysis) the probable strength of the entire slab in terms of the “load” that at least 95% of it can bear.  
  6. [34]
    The use to which concrete will be put will determine how strong it must be.  
  7. [35]
    An Australian Standard, AS 3600, requires concrete slabs which are trafficked by vehicles to be of various characteristic compressive strengths – depending on the nature of the traffic they are expected to bear.  For example, and for obvious reasons, the standard does not require residential driveways to be as strong as public roads.  
  8. [36]
    The slab in the present case had an intended design or characteristic strength of 32 MPa – based on AS 3600’s specified characteristic strength for slabs which will be traversed by pneumatic tyred vehicles.  AS 3600 requires slabs which will be traversed by hard wheeled vehicles to be stronger, at 40 MPa.

The concrete in this case 

  1. [37]
    Cement mixes are designed by concrete suppliers to achieve a certain design strength as measured 28 days after the concrete’s pour.
  2. [38]
    One Sector ordered Grade N32 concrete from a concrete supplier (“Excel”) for the warehouse slabs.  
  3. [39]
    Grade N32 concrete is supplied by way of a cement mix designed to harden to a characteristic strength of 32 MPa after 28 days.  Usually, concrete suppliers design and supply a cement mix which targets a higher concrete strength than design strength to minimise the risk that the concrete supplied will not meet its strength requirements after 28 days.  
  4. [40]
    In this case, no one from Excel was called to give evidence about the strength targeted by their mix in either stage.  

Strength testing

  1. [41]
    AS 3600 anticipates that concrete will be tested, in a prescribed way, 28 days after its pour, to determine whether it has achieved its design, or characteristic, strength.  It is reasonable to assume that the Australian Standards require concrete testing 28 days after pour because, whilst the concrete might continue to harden after that point in time, it hardens at an exponential rate and, if the mix supplied is appropriate, and it is cured appropriately, then it can be expected to achieve its design strength after 28 days. 
  2. [42]
    In this case, the strength of the Stage 2 slab was not tested in accordance with the relevant Australian Standard at 28 days after its pour; or at any other subsequent time after its pour until 2022, when its strength was tested for the purpose of this litigation.  It was then about six years old.  
  3. [43]
    The strength of a hardened concrete slab may be tested by taking small samples from it (cores) and testing those samples.  Each core will have a certain compressive strength.  For several reasons (which need not be articulated), the compressive strength of individual cores may vary.  Thus, one may not safely or reliably determine the strength of an entire concrete structure or slab on the basis of the compressive strength of one core only.  Several of the documents tendered at trial, which included Australian and European standards, provide formulas for the calculation of the in-situ “strength” of a concrete structure (including a slab) based on the cores taken from it – in terms of either an average or mean compressive strength, or its characteristic compressive strength.
  1. [44]
    Some of the documents tendered at trial set out broad ranges for likely per centage increases in concrete’s strength over time – including beyond 28 days.  But there is no generally accepted method or formula which would enable an engineer (or anyone else) to calculate the strength of concrete 28 days after its pour on the basis of its strength at a later date alone.  
  2. [45]
    One of the issues for me in this case concerned the defendant’s contractual obligation when it came to the concrete’s strength.  

Slump

  1. [46]
    Slump is a quantitative measure of the consistency or workability of fresh concrete (the poured cement mix).  Slump is determined by a test in which: (a) a cone shaped mould is filled with fresh concrete; (b) the mould is inverted; (c) the mould is lifted vertically, up and away from the concrete; and (d) the vertical height of the slumped concrete is measured against the height of the cone.  The difference in millimetres is the slump.  
  2. [47]
    Concrete with a higher slump is softer and wetter and easier to manoeuvre than concrete with a lower slump, which is harder and drier.  A batch of concrete’s slump will be increased by the addition of water to the cement mix.  Adding more water than intended for a mix will increase the workability of the concrete when it is wet; may reduce the strength of it when it has hardened; and may affect its surface hardness.  
  3. [48]
    In designing a concrete slab, engineers will specify the slump of the concrete to be used.  Australian Standards allow for a tolerance of 15 mm for a specified slump of 80 mm.  A tolerance of 20 mm is permitted for a 100 mm slump.  One of Hestbay’s complaints was that One Sector ordered concrete with a higher slump for the Stage 2 slab (100mm) than that specified by the engineers (80mm).

Australian Standards relevant to the slab’s construction

  1. [50]
    Several Australian Standards applied to the construction of the warehouse slabs and were referred to in this matter.  They included – 
    1. AS 3600-2009 (and AS 3600-2018): Concrete Structures.
    2. AS 1379-2007: Specification and supply of concrete. 
    3. AS 1012.9: Methods of testing concrete: compressive strength tests – concrete, mortar and grout specimens.
    4. AS 1012.14: Methods of testing concrete: method for securing and testing cores from hardened concrete for compressive strength.
  2. [51]
    To understand the evidence of the experts, it was necessary for me to achieve a reasonable level of understanding of the engineering principles behind their opinions.  That required me to study the Australian Standards and other authoritative documents to which they referred in some detail.  
  3. [52]
    The definitions used in the standards assumed some relevance because of the debate between the parties about the defendant’s obligation under the Stage 2 contract.  One Sector submitted that it was under no contractual obligation to provide a slab which was of  32 MPa at 28 days after its pour.[5] In its outline of closing submissions it said, “Hestbay has not identified any contractual basis for the concrete to be at a particular strength by 28 days after pouring, and before handover of the project works.  No such obligation exists.”  One Sector submitted that its obligation was to use N32 concrete and it did so.  It was thus submitting, in effect, that it was not required to construct a slab which actually achieved its design strength.  As will emerge, I found that its obligation was to construct a slab which was of a characteristic compressive strength of 32 MPa at 28 days after its pour.
  4. [53]
    The Preface to the 2009 version of AS 3600 (the version which was applicable when the slabs were constructed) includes the following statement of its objective:

Objective of the Standard

The principal objective of the Standard is to provide users with nationally acceptable unified rules for the design and detailing of concrete structures and members, with or without steel reinforcement or prestressing tendons, based on the principles of structural engineering mechanics.  The secondary objective is to provide performance criteria against which the finished structure can be assessed for compliance with the relevant design requirements.

  1. [54]
    Clause 1.1.1 of AS 3600, Scope, states that the standard sets out “minimum requirements for design and construction of concrete building structures and members …”.  
  2. [55]
    As per clause 1.1.2, the standard applies to structures and members in which the materials conform to the following: “Concrete with (i) characteristic compressive  strength at 28 days … in the range 20 MPas to 100 MPas; and (ii) with a saturated surface-dry density in the range of 1800kg/m3 to 2800kg/m3.
  1. [56]
    By clause 1.3, the general principles of AS 3600 are to be applied when evaluating the strength or serviceability of an existing structure.  
  2. [57]
    Definitions for the standard are contained in clause 1.6.  They include the following:

1.6.3.12.  Characteristic strength

Value of the material strength, as assessed by standard test, that is exceeded by 95% of the material (lower characteristic strength).  

1.6.3.56  Mean strength

Statistical average of a number of test results representative of the strength of a member, prototype or material.  

1.6.3.74  Strength grade

Numerical value of the characteristic compressive strength of concrete at 28 days (f’c), used in design.[6]

  1.6.3.85  Upper characteristic strength

Value of the material strength, as assessed by standard test, which is exceeded by 5% of the material. 

  1. [58]
    Section 2 is headed, “Design procedures, actions and loads”.  Clause 2.1.1, “Design for strength and serviceability” states: “Concrete structures shall be designed for ultimate strength and serviceability limit states in accordance with the general principles and procedures for design as set out in AS/NZS 1170.0 and the specific requirements of Clauses 2.2 and 2.3”. 
  2. [59]
    Clause 2.2 concerns design for strength and requires certain strength checks.  Clause 2.3 concerns design for serviceability and requires design checks to ensure that a structure will perform in a manner appropriate for its intended function and purpose.  
  3. [60]
    Clause 3.1.1.1 of AS 3600-2009 requires the characteristic compressive strength of concrete to be determined as follows: 

The characteristic compressive strength of concrete at 28 days (f’c) shall be either – 

  1. taken as equal to the specified strength grade, provided the appropriate curing is ensured and that the concrete complies with AS 1379; or
  2. determined statistically from compressive strength tests carried out in accordance with AS 1012.9. 

The characteristic compressive strengths of the standard strength grades are 20 MPa, 25 MPa, 32 MPa, 40 MPa, 50 MPa, 65 MPa, 80 MPa and 100 MPa.

  1. [61]
    Clause 3.1.1.2 “Mean in-situ compressive strength” states:

In the absence of more accurate data, the mean value of the in-situ compressive strength (fcmi) shall be taken as 90% of the mean value of the cylinder strength (fcm) or shall be taken as those given in table 3.1.2.  

  1. [62]
    According to the table, for concrete with a characteristic compressive strength of 32 MPa at 28 days, the mean in-situ compressive strength will be 35 MPa.
  2. [63]
    Table 4.6 of AS 3600 prescribes the “not less than” characteristic compressive strength required of concrete members subject to abrasion from traffic – such as the floor slabs in the present case.

4.6 ABRASION

In addition to the other durability requirements of this section, concrete for members subject to abrasion from traffic shall have a characteristic compressive strength not less than the applicable value given in Table 4.6.

TABLE 4.6

STRENGH REQUIREMENTS FOR ABRASION

Member and/or traffic

Minimum characteristic  Compressive strength

(ƒ′c)

MPa

Footpaths and residential driveways

 

20

Commercial and industrial floors not subject to vehicular traffic

 

25

Pavements or floors subject to:

 

  1. Pneumatic-tyred traffic

 

  1. Non-pneumatic-tyred traffic

 

  1. Steel-wheeled traffic

 

 

32

 

40

 

To be assessed but not less than 40

 

NOTE: ƒ′c refers to the characteristic compressive strength of the wearing surface

  1. [64]
    My understanding of the standard is that concrete is to be tested for strength (and other properties) always by the supplier – a production assessment – and sometimes also by the person to whom the concrete is supplied – a project assessment.[7]  
  2. [65]
    Section 17 is entitled, “Material and construction requirements”.  By clause 17.1.6.1, “Concrete, which is intended for use in structures designed in accordance with this  Standard, shall be assessed in accordance with AS 1379 for compliance with the specified parameters.”  The clause also contains the following note: “NOTE: When project assessment is required, the project specification should nominate responsibility for carrying out the relevant sampling, testing and assessment and, if these differ from or are not covered by AS 1379, should give details of how the assessment is to be made”.
  1. [66]
    In the present case, the engineers required project assessment for compressive strength and slump requirements, which required sampling on-site, on several occasions during the pour, and testing at certain intervals thereafter, with the results to be reported to the engineers.  In the case of the Stage 2 slab, samples were taken on the first day of the pour only and the project assessment was not properly done.
  2. [67]
    Clause 17.1.6.2 sets out the criteria which must be satisfied for concrete specified by strength grade.  It states: “… (a) For each strength grade of concrete supplied to a project, the mean cylinder compressive strength (fcm) as defined in AS 1379, shall be maintained within the limits specified in that Standard”.
  3. [68]
    A note to that clause explains that: “Strength grade” is defined in AS 1379 as the specified value of the characteristic compressive strength of the concrete at 28 days (f’c). The note continues, “The compressive strength of the concrete sampled, tested and assessed in accordance with AS 1379 indicates the potential strength of the supplied concrete, when placed, compacted and cured under optimum conditions; the responsibility of demonstrating rests on the supplier.  The achievement of that potential on site is dependent upon the handling, placing, compacting and curing techniques actually used; the responsibility for which rests with the construction contractor …”[8]  (AS 1379 is discussed below.)
  4. [69]
    Appendix B of AS 3600-2009 is entitled “Testing of Members and Structures”.  Its first paragraph (B1) explains its purpose, which includes setting out strength testing methods for hardened concrete in place, as detailed in part B6.  The basis for the estimate of strength set out in B6.4.2, that is the multiplication of average core strength by 1.15, assumed some importance in the present case.  
  5. [70]
    Relevant parts of Appendix B follow.  It is important to note its application:

B1 GENERAL

This Appendix applies to the testing of a structure … to check that the strength and serviceability requirements of this Standard are met.  Methods for testing hardened concrete in place are also detailed.  Testing shall be undertaken by persons competent in, and with appropriate expertise for, performing such tests.  

B6 TESTING OF HARDENED CONCRETE IN PLACE

 B6.1    Application 

This paragraph applies to the assessment of strength and other properties of hardened concrete in place by non-destructive testing, by testing of samples cut from representative test panels, or samples cut from members.

…

 B6.4  Tests on samples taken from the structure

 B.6.4.1  Test requirements

Taking and testing of cores and beams from members and sample panels shall comply with the following:

  1. Core and beam locations shall be selected so as to minimize any consequent reduction of strength of the structure.
  2. The cores and beams shall be representative of the whole of the concrete concerned and in no case shall less than three samples be tested.
  3. Cores and beams shall be examined visually before and after testing to assess the proportion and nature of any voids, cracks and inclusions present.  These factors shall be considered in the interpretation of the test results.
  4. Cores shall be taken and tested for compressive strength in accordance with AS 1012.14 … 

 B6.4.2  Interpretation of results

The strength of the concrete in the member may be estimated — 

  1. as 1.15 times the average strength of the cores and beams; or
  1. by using test data from cores or beams taken from another member for which the strength of the concrete is known.
  1. [71]
    The parts of AS 3600-2009 extracted above are identical to those in the later issued standard AS 3600-2018, apart from small changes to B6.4.2 including by replacing “may” with “shall” and tidying up the grammar.[9]  
  1. [72]
    In the present case, testing in accordance with AS 1012.14 was undertaken in 2022.  The cores were tested for compressive strength in accordance with AS 1012.9.  
  2. [73]
    Among other things, AS 1379-2007 sets out the minimum requirements for the sampling of, testing of, and compliance with specified properties of, plastic and hardened concrete. 
  3. [74]
    It includes a definition clause which defines relevant concepts as follows:

1.3.6  Cement

A hydraulic binder composed of Portland or blended cement used alone or combined with one or more supplementary cementitious materials. 

1.3.7  Characteristic strength

The value of the concrete strength, as assessed by standard test, which is exceeded by 95% of the concrete.

1.3.8  Concrete

A mixture of cement, aggregates, and water with or without the addition of chemical admixtures or other materials and defined as follows:

  1. Plastic concrete  Concrete in the state between completion of mixing and initial set as defined in AS 1012.18.
  2. Hardened concrete  Concrete after initial set, as represented by test specimens that have been subjected to a specified process and duration of curing.
  3. Normal class concrete  Concrete that is specified primarily by a standard compressive strength grade up to 50 MPa and otherwise in accordance with 1.5.3.
  4. Special-class concrete …

1.3.10  Mean grade strength

The arithmetical mean of all relevant 28-day sample strengths taken in a production interval for the particular strength grade.

1.3.14  Production assessment

An assessment procedure for concrete defined by strength grade, carried out by the supplier and based on the statistical assessment of standard compressive strength tests on concrete, specified by compressive strength and produced by a specific supplying plant.

1.3.15  Project assessment

An assessment procedure for concrete defined by strength grade, specified at the customer’s option, which provides additional test data for the statistical assessment on concrete supplied to a specified project.

1.3.21  Total free water

The mass or volume of water contained in liquid admixture and batch aggregates, in excess of their SSD [saturated surface dry] condition, plus the mass or volume of all water added to the batch before commencement of discharge. 1.3.22  Water-cement ratio (w/c)

The ratio of the mass of total free water in a batch to the mass of cement (as defined in 1.3.6) in the batch.  

  1. [75]
    Clause 1.5.2 explains that standard strength grades and their corresponding design compressive strengths “shall be as given in Table 1.1”.  According to Table 1.1, for “32” standard grade concrete, its design characteristic compressive strength after 28 days of standard curing is 32 MPa.  
  1. [76]
    Section 4 deals with production and delivery.  Clause 4.2.1.2 “Water” requires “control” of the water added to a batch to be achieved by controlling the slump or by controlling the water-cement ratio, as follows:

Where the ratio of total water to cement has been specified, the quantity of added water shall be controlled so that the ratio in the mix is maintained within + 10% of the specified value.  If a maximum water-cement ratio has been specified, this value shall not be exceeded.

  1. [77]
    In the present case, the notes to the engineers’ drawings stated that the concrete was to have a “water/cement ratio of not greater than 0.65 …unless approved otherwise”.  
  2. [78]
    Clause 4.2.3 deals with the addition of water to a mixed batch of concrete by the supplier.  It requires slump to be tested after water is added.[10]  
  3. [79]
    Section 5 requires concrete to be sampled and tested for compliance with, inter alia, slump (as per Clause 5.2) and strength (as per Clause 5.3).  It requires slump to be determined in accordance with the slump test prescribed by AS 1012.3.1.  Clause 5.2.3 sets out the permissible tolerances for compliant slump. 
  4. [80]
    Clause 5.3.1 requires the sampling, testing and assessment of the strength of concrete specified by a compressive strength grade to be carried out in accordance with Section 6 of AS 1379-2007.  
  5. [81]
    Clause 5.5.3 “Compliance” states: “For concrete specified by compressive strength, concrete represented by the strength samples shall be deemed to comply with the specified strength if the relevant requirements of Section 6 are satisfied”. 
  6. [82]
    Section 6 is headed, “Sampling, testing and assessment for compliance of concrete specified by compressive strength”.  The concrete in the present case was specified by the strength grade N32.
  7. [83]
    Section 6 deals with sampling and testing of plastic concrete, production assessment and project assessment.  
  8. [84]
    Clause 6.2 deals with the sampling of plastic concrete samples.  Clause 6.2.3 states that from each sample intended for strength grade assessment, at least two standard cylinder specimens are to be made and cured, in accordance with AS 1012.8.1 and AS 1012.8.2.  
  9. [85]
    Clause 6.5 deals with the project assessment of the strength grade of cement, where it has been specified.  In such a case, project assessment is to be in accordance with clauses 6.5.2 or 6.6.  Among other things, clause 6.5.2 requires samples to be taken from each 50 cubic metres of concrete. 

Authoritative documents other than Australian Standards

  1. [86]
    In addition to Australian Standards, the experts referred to other documents which they considered authoritative.  They are discussed below.  

Concrete Institute of Australia: Recommended Practice: The Evaluation of Concrete Strength by Testing Cores 

  1. [87]
    The experts referred to a document produced by the Concrete Institute of Australia (the CIA) entitled “Recommended Practice: The Evaluation of Concrete Strength by Testing Cores”.
  2. [88]
    It explains that the information it contains is intended for general guidance only.  It is said to be based on recommendations of Australian Standards, Concrete Society reports and “new developments in this field”.  
  3. [89]
    Its Part 2 deals with the obtaining of cores.  Its Part 3 deals with the determination and evaluation of concrete strength by the testing of the cores.  
  4. [90]
    Its appendices deal with the technical requirements of the testing process, including, for example, the need for correcting core strength for the length to diameter ratio of the core, or for age.  Appendix 8 sets out the process for the evaluation of concrete strength.  

The Z11 document

  1. [91]
    The experts referred to another CIA document, “Z11 In-situ Strength Assessment of Concrete Structures and Components”, published in 2021.[11] Dr Woolcock and Dr Khan ultimately adopted the method suggested by this document in assessing the strength of the Stage 2 slab in 2022.
  2. [92]
    The CIA makes it clear in its introduction to Z11 that the information contained in it is “for general guidance only”.  It cautions that it was written as a “guide to the assessment in-situ (sic) strength of concrete structures and components in Australia”.  It explains that it is based on established practice.  It acknowledges that the science and knowledge of materials is “an evolving technology” and states that its content represents the state of knowledge at publication, which may be subject to change over time.  The document was prepared by a working group of members of the CIA including Tony Thomas.  Dr Woolcock relied upon Mr Thomas’ hearsay opinion in justifying his conclusions.  
  3. [93]
    In its introduction, Z11 explains (my emphasis):

In design, engineers generally use a cylinder characteristic compressive strength, which is defined by most design codes as: “The value of concrete strength as assessed by a standard test, that is exceeded by 95% of the material.  

After correction, core compressive strength data may be used to estimate characteristic concrete compressive strength and generally this testing is either: (a) to determine compliance of  delivered concrete to the contract specification; or (b) to determine an appropriate strength to use in design or structural modifications or assessment. 

…

Both methods require obtained core compressive strength data to be corrected to account for factors including diameter. Length/diameter ratio and possibly conditioning.  Corrections for concrete age should be used with care as different cements and binders may have different aging properties.

In order to determine the characteristic compressive strength (f’c) statistical analysis is conducted using the mean and standard deviation of the test data.

This document provides appropriate techniques for sampling and testing of cores and analysis of data.  It may be used by the concrete supplier, designer or other interested party to estimate compliance of delivered concrete or provide an estimate of the appropriate strength that may be used in design.

  1. [94]
    Z11 discusses core testing for compliance and explains why correction factors must be applied to the core samples taken for the purpose of evaluating strength.  It explains why core compressive strengths must be converted to equivalent standard cylinder strengths to allow for an estimate of characteristic compressive strength.  It continues (my emphasis):

This is not a simple calculation as typically the mean of the core strengths are lower than that of the cylinders and the standard deviations are greater.  This complication has led to a variety of methods being available internationally to calculate an appropriate design strength from in-situ strength assessment based on core compressive strength testing, and the choice of method may lead to considerably different estimates of design values …

Practice Z11 is to assist engineers to assess the in-situ compressive strength of existing concrete structures as accurately as possible, utilising the latest published knowledge and research in the area and with the assistance of modern accepted technology and equipment such as NDT [non destructive testing].  

  1. [95]
    The following definition was of some importance:

In-situ characteristic compressive design strength

The in-situ characteristic core compressive strength of a test region, converted to equivalent in-situ characteristic strength of standard specimens (e.g. cylinders), also known as equivalent design compressive strength or equivalent specified compressive strength, by either multiplying by 1.15 (AS 3600, 2018) or dividing by 0.85 (EN 13791: 2019) to account for several known factors that lead to weaker compressive strength when testing cores sampled from an existing concrete element compared to testing of standard specimens cast using the same concrete mix, cured under laboratory conditions.  

  1. [96]
    On the basis of this definition, it seemed to me that the authors of Z11 considered the reference to “strength” in B6.4.2 a reference to in-situ characteristic compressive design strength as confirmed by the footnote to s 3.9, discussed below.
  2. [97]
    Chapter 3 of Z11 is entitled “Coring”.  It begins with the following statement:

Many Australian concrete testing laboratories are set up to test cores for compressive strength in accordance with AS 1012.14 (2018) and AS 1012.0 (2014), standards that have existed for several decades.  Therefore, this document has been written to supplement provisions in existing Australian Standards for strength assessment of in-situ concrete and to not contradict relevant requirements of these Australian Standards except in exceptional circumstances.

  1. [98]
    I note, but will not discuss here, Section 3.8 which deals with the conversion of core strength to equivalent standard cylinder strength and Z11’s recommended practice for the application of correction factors.[12] By way of a footnote, the paragraph refers the reader to paragraph 3.9, “for recommendations on how to interpret and when to use AS 3600 (2018), Appendix B, clause B6.4.2 for characteristic strength assessment of existing concrete structures, and how this clause in AS 3600 compares to similar guidelines in AS 1379 (2007)”.  Again, obviously, the authors of Z11 considered B6.4.2 to provide for the calculation of characteristic strength, although (as below) they cautioned against its use in certain situations.   
  2. [99]
    Section 3.9 of Z11 is entitled “Discussion and recommendations on the application of AS 3600 (2018), Appendix B, Clause B6.4.2”.  It makes the following points (emphasis in bold in original; my emphasis in underlining): 
    1. AS 3600 (2018) [and the earlier 2009 version] contains a multiplication factor of 1.15 to convert core compressive strength to an equivalent standard cylinder strength because core compression tests produce lower strength results than equivalent standard cylinder compression tests.  However, the actual reason for choosing 1.15 is not clear.  It is believed that this 1.15 conversion factor is based on the 0.85 (approximately 1/1.15) factor originally found in early US specifications.
    2. As per AS 3600, the average of three corrected core strengths is considered to satisfy the characteristic strength specified where they exceed 0.85 f’c (or 1.15 x average corrected core strength > f’c).  This fits in with clause 6.5.2 of AS 1379 (2007) for “Project Assessment” where the average of 3 cylinder test sample strengths must exceed f’c to be compliant provided that the concrete mix grade has been tested and found to be compliant for AS 1379 (2007) rules as well.  In this regard – 
      1. AS 3600 clause B6.4.2 is a “deemed to comply” requirement and does not aim to calculate the actual in-situ characteristic strength of an existing concrete member.  It should only be applied when the design strength grade of the concrete under test is known. 
      2. This does little to assist with cases where it is not known whether the concrete under review has been tested in accordance with AS 1379 and found to be compliant.  In this case, clause B6.4.2 should not be relied upon and the detailed procedures recommended in Z11 should be followed to calculate an estimated in-situ characteristic strength.
      3. …
    3. “Due to an unfortunate lack of clarification within AS3600 … or the Commentary [to it], some engineers may incorrectly interpret AS 3600 clause B6.4.2 to be an appropriate method for determining the characteristic design strength of a single member in an old building or structure, especially where it is highly likely constructed from just one batch of concrete … [A]s explained above, using AS 3600’s Appendix B6 method to estimate the characteristic strength in a single member of an old building or structure where one does not know the design strength grade or whether the concrete used is AS 1379 … compliant runs a very real risk of being unconservative”.  An engineer using a strength value calculated on that basis, may be over-estimating the characteristic strength and structural capacity of the member.  
    4. For in-situ compressive strength assessment of small test regions such as single members, where the design strength grade is not known; or it is not known whether there was compliance with AS 1379, it is recommended that – 
  1. B6.4.2 ought not to be followed.
  1. Methods contained in BS EN 13791 (2019) specific for small test regions are followed, including all of the conditions they contain for their use, including the requirement for the spread of core compressive strength results to be < 15% of the mean otherwise more information about the members/region being assessed will need to be obtained.  
  1. Other international published standards may have similar and equally appropriate procedures for in-situ characteristic strength assessment of small test regions or single members to BS EN 13791 (2019).  Section 5.1.2 and 5.3 of this Recommended Practice provide further recommendations on the types of procedures to follow in these scenarios.
  1. [100]
    Chapter 5 is entitled “Procedure for Determination of Characteristic Compressive Strength of Existing Concrete Structures of Unknown Strength”.
  2. [101]
    Section 5.1 is critical of clause B6.4.2 of Appendix B of AS 3600 (2018).  It states that its use risks structural engineers erroneously using the value calculated from its procedure as the characteristic design compressive strength to use when completing a structural assessment of an existing structure.  After explaining its issues with the procedure, Z11 recommends that a statistical procedure, such as one of the Z11 tolerance methods it discusses, should be followed – especially where it is not known whether the concrete under review has been tested in standard test specimens according to AS 1379 and found to be compliant. (As will emerge, Dr Woolcock was unaware of this negative commentary about B6.4.2 when he wrote his first report.  Indeed, he seemed unaware of B6.4.2.)
  3. [102]
    Z11 sets out a flow chart of the steps to be followed to determine characteristic compressive strength.  It also refers the reader to a detailed discussion of current published international standards which contain methods for the calculation, on a statistical basis, of in-situ characteristic strength based on corrected core compressive strength, in its Appendix D.  It recommends that the calculated in-situ characteristic core strength value should be converted into the equivalent for cylinder strength results either by dividing by 0.85 or multiplying by 1.15 – whatever is recommended in the jurisdiction of the standard followed.  (As will emerge, Dr Woolcock applied the wrong conversion factor in one of his later reports.)
  4. [103]
    Appendix D is entitled, “Further discussion of determination of in-situ characteristic compressive strength for structural assessment of an existing structure from core testing only”.  It includes harsh criticism of Appendix B of AS 3600.  It says its benefits are that it is “the ubiquitous Australian concrete structures design code” but that it has “unfortunately significant” drawbacks.  They are that Appendix B6 does not calculate an in-situ characteristic strength for use in structural design.  It calculates an in-situ mean strength which should not be directly used in structural design as it would potentially equate to a 50% probability of failure.  
  5. [104]
    Appendix D made positive statements about BS EN 13791 (2019).[13]  
  6. [105]
    Appendix B is entitled “Additional corrections that can be applied for assessment of compressive strength class of supplied concrete that is in doubt”.  Paragraph B2 is entitled “Strength Adjustment for Concrete Maturity”.  That paragraph explained why, in the current 2021 edition of Z11, no precise correction factor for concrete age was provided (my emphasis):

In the previous version of [Z11] a correction factor was provided for concrete age, i.e. to relate the 28 day characteristic strength of concrete to characteristic strength measured at later ages.  In this revision it has been decided that a precise correction factor for concrete age should not be provided and may provide uncertainty in design.

This is due to the rate of concrete strength gain after 28 days being dependent on many variables unique to each situation including environmental conditions, curing during service, cement (binder) system of the concrete and the water to binder ratio.  It is noted that most concretes obtain 90% of their ultimate compressive strength within the first 28 days after placement and that the strength gains after this period are typically not as great as suggested by the correction factor table in the previous version of CIA Z11 (2002) where 20% to 30% further strength gains after 28 days were allowed to be considered for some blended cement system concretes.

…

  1. [106]
    B2 continued with a discussion of when an adjustment for maturity ought to be made.  Maturity is something different from age and such an adjustment is not necessary when assessing the in-situ compressive strength of an existing structure which is likely several years old.

BS EN 13791:2019

  1. [107]
    This is a standard of the British Standards Institute which is the “UK implementation of EN 13791:2007 and BS 6089:2010 which are withdrawn”.  It is entitled “Assessment of in-situ compressive strength in structures and precast concrete components”.  
  2. [108]
    Its introduction states:
    1. This document covers two applications of in situ strength assessments.  These are:
      • – to estimate in situ characteristic compressive strength of a test region and/or in situ strength at specific locations;
      • – assessment of compressive strength class of concrete supplied to a structure under construction where there is doubt about the compressive strength based on results of standard tests or doubt about the quality of execution.  
    2. Both applications have a number of common steps … but the assessment methods differ.  The reason for this difference is that with the estimation of the in situ strength (Clause 8) there is no presumption as to what this should be and the uncertainty associated with the number of data are taken into account when estimating the value. The in situ strength determined in accordance with Clause 8 is a value based on testing a finished structure or element, as referred to by EN 1992-1-1:2004, A.2.3.

NOTE: Information may be available on the original quality of the supplied concrete, but the in situ strength may have changed over time.

  1. [109]
    Clause 8 is entitled, “Estimation of compressive strength for structural assessment of an existing structure”.  It sets out formulas for this estimation based only on core test data at paragraph 8.1.
  2. [110]
    Clause 9 is entitled “Assessment of compressive strength class of concrete in case of doubt”.  Paragraph 9.1(1) explains that doubt about the in situ quality of concrete may arise from doubts about the quality of the concrete supplied to the site, problems during the execution of the works or after some exceptional event on site.  Paragraph 9.1 (4) explains that if the procedures of clause 9 are satisfied, the defined test region shall be accepted as having conformed to the specified compressive strength class.  It continues, “From this it may be concluded that the concrete delivered to site, and any adjustments to the concrete on site and any deviation on the execution with respect to placing, compacting and curing as required by EN 13670 or EN 13369, as appropriate, were not significant with respect to compressive strength”.   

European Standard EN 1992 -1-1 Eurocode 2

  1. [111]
    This document is entitled “Design of concrete structures – Part 1.1: General rules and rules for buildings”.  Among other things, it describes the principles and requirements for safety, serviceability, and durability of concrete structures.  
  2. [112]
    Section 3 deals with “Materials”.  When speaking of concrete’s strength, it speaks in terms of its compressive strength, which is denoted by its strength class, which relates to the characteristic (5%) cylinder compressive strength.  Strength classes are based on the characteristic cylinder strength determined at 28 days.  It sets out at 3.1.2 (4) the way in which to assess the compressive strength of concrete, before or after 28 days, on the basis of test specimens which have been stored under conditions other than those prescribed in EN 12390.[14] 
  3. [113]
    Section 3.1.2 (6) provides a formula (Expressions (3.1) and (3.2)) for the estimate of the compressive strength of concrete at a certain age for a mean temperature of 20° and curing in accordance with EN 12390.  However, if the concrete does not conform to the specification for compressive strength at 28 days, the use of Expressions (3.1) and (3.2) is not appropriate.  The clause should not be used retrospectively to justify a non-conforming reference strength by a later increase of the strength.  

National Construction Code Series 2015 

  1. [114]
    The experts agreed that the National Construction Code Series 2015 Volume 1 “Building Code of Australia Class 2 to Class 9 Buildings” was the over-riding control document in the building industry.  Extracts from it were tendered.  But, those extracts did not include the Code’s “Application” or “Interpretation” chapters, which made it very difficult for me to make sense of them.  No expert evidence was called to assist me.
  2. [115]
    The extracts that were included explain that the National Construction Code Series was developed to incorporate all on-site construction requirements into a single code in three volumes.  Volume 1 was for class 2 to 9 buildings.  Hestbay’s warehouses were Class 7b buildings.  The extracts explain that the Building Code of Australia is “a uniform set of technical provisions for the design and construction of buildings and other structures throughout Australia whilst allowing for variations in climate and geological or geographical conditions”.[15] Its goal is “to enable the achievement of nationally consistent, minimum necessary standards of relevant safety (including structural safety and safety from fire), health, amenity and sustainability objectives efficiently”.[16] 
  3. [116]
    Part 1B contains Deemed-to-Satisfy structural provisions.  However, because I was not provided with the whole document, I could not make sense of the Part.  For example, B1.0 stated:
    1. Where a Building Solution is proposed to comply with the Deemed-to-Satisfy Provisions, Performance Requirements BP1.1 to BP1.4 are satisfied by complying with B1.1., B1.2, B1.3, B1.4, B1.5 and B1.6
    2. …
  4. [117]
    But I did not know if, or how, the phrases in italics in B1.0 (a) were defined.  Nor was I provided with the Performance Requirements.   
  5. [118]
    B1.1 sated that the resistance of a building or structure must be “greater than the most critical action effect resulting from different combinations of actions, where –
    1. the most critical action effect on a building or structure is determined in accordance with B1.2 and the general design procedures contained in AS/NZS 1170.0; and
    2. the resistance of a building or structure is determined in accordance with B1.4.  
  6. [119]
    B1.4 is entitled “Determination of structural resistance of materials and forms of construction.  B1.4(b), the paragraph relied upon by the defendant, provides:

The structural resistance of materials and forms of construction must be determined in accordance with the following, as appropriate … Concrete construction …: AS 3600.

  1. [120]
    It was not clear to me what the phrase “structural resistance” meant – but it seemed broad enough to encompass notions of strength, abrasion resistance, compressive strength and characteristic compressive strength.
  2. [121]
    I will turn now to the evidence in the case.

The parties and early negotiations

  1. [122]
    The plaintiff company, “Hestbay”, became the owner of industrial land at Molendinar on which there were existing buildings.  Hestbay wished to develop industrial warehouses on the site.  John Hutchins is one of Hestbay’s directors.
  2. [123]
    The defendant company, “One Sector”, is an industrial design and construction company.  It specialises in “tilt panel light industry warehouses”.  Nicholas Ray is its director.  He is a concreter by trade. 
  3. [124]
    Mr Hutchins and Mr Ray met on 12 December 2013 to discuss a demolition and new build.  According to Mr Ray, Mr Hutchins said that he wanted One Sector to build on the site “light industry warehouses” which had “the most lettable area possible”; and that he wanted to develop the site “as cheaply and quickly as possible”.  Mr Hutchins said he did not use the phrase “cheaply and quickly”.  Rather, he said he wanted to develop the premises in the most economical way possible (which is probably the same thing).
  4. [125]
    In 2015, Hestbay and One Sector agreed that One Sector would design and construct an industrial warehouse complex on Hestbay’s land.  The construction was to be completed in two stages: Stage 1 and Stage 2.  Hestbay contracted separately with One Sector for each stage.
  5. [126]
    One Sector engaged John Hooker, an architect, and Westera Partners, engineers, to design the warehouse and to prepare detailed drawings for its construction.  
  6. [127]
    Hestbay engaged “GMP” – a project management company – to assist in the development and to act as the Superintendent for Stage 1.

The warehouses’ purpose

  1. [128]
    Hestbay was a first-time, industrial warehouse developer, to Mr Ray’s knowledge.[17]  Hestbay asserted that it depended upon One Sector to design and construct the industrial warehouse complex in such a way as to render the units within it suitable for use by industrial or commercial tenants of all kinds (which would include those who used hard wheeled vehicles).
  2. [129]
    Mr Ray said that his instructions were to build light industry warehouses without any reference to prospective tenants, their businesses, or their needs.  He considered the warehouses to be “speculative buildings” because neither he nor Mr Hutchins knew “what any future tenant’s requirements might be”.  Nor was there any discussion during which Mr Hutchins told him that Hestbay was relying on him or One Sector to design and construct the warehouses “to ensure that they were fit for the purpose of leasing them to a wide variety of tenants for commercial use”. 
  3. [130]
    In oral evidence, Mr Ray said that, since 2009, he’d built about 100 “light industry” warehouses.  They had all been built with 32 MPa slabs.  Having (now) read the engineers’ notes, he understood that such a slab was suitable for pneumatic tyred vehicles only.  He could not remember whether he knew, when he constructed Hestbay’s warehouse, that the slab would need to be 40 MPa (that is, harder/stronger) if non-pneumatic tyred vehicles were traversing it.  He knew that harder concrete was more expensive.  He knew that some of the sheds he built were used for storing things and that some had racking.[18]
  4. [131]
    Mr Ray said that he told Mr Hutchins that the warehouses One Sector would build were for “light industry”, but he did not remember telling Mr Hutchins what that expression meant.  He agreed that his tender for Stage 1 did not use the word “light”: the build “Type”, as per his tender, was “Tilt panel Design with Structural Steel Roof”.[19]  He agreed that nothing in the tender identified any constraints upon the use of the concrete slab.  Nor did he recall any conversation with Mr Hutchins about the need to limit the traffic in the warehouses to pneumatic tyred vehicles. 
  5. [132]
    Mr Ray did not tell the architect or the engineers that the slab for the warehouse complex had to be 32 MPa.[20] He did not pass on to the architect or the engineers any other specifications for the complex because he did not have them.  

Warehouse completion, occupancy and maintenance 

  1. [133]
    Stage 1 was completed on 17 June 2015.  It included a warehouse of eight units, numbered 1 to 8.  
  2. [134]
    Stage 2 was completed on 2 August 2016.  It included a warehouse of five units and an office.  Its unit numbers were 9, 9A (the office), 10, 11, 12 and 13. 
  3. [135]
    The first of the Stage 1 leases commenced in September 2015.  Stage 1 ultimately housed two tenants.  Each tenant occupied more than one unit.  
  4. [136]
    The first of the Stage 2 leases commenced in May 2017.  Stage 2 ultimately housed three tenants.  Each tenant occupied either one, two or three units.  For a period of time, One Sector leased the Stage 2 office unit.
  5. [137]
    Hestbay subcontracted the maintenance of the warehouses and the tenant side of property management to a company (BNE Professional Services Pty Ltd) which employed Bruce Willmott.  Tenants were to go to Mr Willmott with any concerns.  
  6. [138]
    Mr Willmott attended to matters of routine maintenance himself and took instructions from Hestbay in relation to non-routine matters.

The Stage 1 contract 

  1. [139]
    There is no dispute about the nature and terms of the Stage 1 contract made on 1 August 2014.  Its terms came to be settled in the following way.  
  2. [140]
    On 13 June 2014, GMP advised Mr Hutchins that the initial Design and Construct Contract, which had been sent from One Sector to Hestbay for Stage 1 and which included One Sector’s terms and conditions, was not suitable.  GMP advised Mr Hutchins that his financier would require a “suitable form of contract such as the [Australian Standards design and construct contract] AS 4902”.[21]  
  1. [141]
    On 20 June 2014, GMP provided Mr Hutchins with such a contract in draft.  Mr Hutchins sent the draft contract to Mr Ray on 27 June 2014, noting that it was “derived from Bank requirements and industry standard”.[22]
  1. [142]
    By 30 July 2014, the Stage 1 contract was at signing stage.[23] It was sent to Mr Ray by Mr Hutchins, by email, on that date.  
  2. [143]
    The Stage 1 contract consisted of the following documents:[24]
    1. An Australian Standards’ formal instrument of agreement, AS 4902 – 2000, which listed at clause 6 the contract documents; 
      • Its recitals included the following at C: “The Principal has agreed to engage the Contractor to carry out design and construction work in connection with the project [industrial development at Molendinar] upon and subject to the terms and conditions set out in this Contract.”
    2. The AS 4902 – 2000’s “General conditions of a contract for design and construct”;
      • The Preface to the general conditions included the following statement: “If the project procurement method chosen by the Principal is: (a) design and construct – the Principal would provide the Principal’s project requirements, would not normally provide detailed preliminary design and would not require novation;

and  

  1. Annexures to the AS 4902 – 2000 general conditions marked “Part A” through to “Part G”.
  1. [144]
    The AS 4902 contract contains the following relevant definitions:

Contractor’s design obligations means all tasks necessary to design and specify the Works required by the Contract, including preparation of the design documents …

Principal’s project requirements means the Principal’s written requirements for the Works described in the documents stated in Item 10 which: (a) shall include  the stated purpose for which the Works are intended; (b) may include the Principal’s design, timing and cost objectives for the Works; and (c) where stated in Item 10, shall include a preliminary design.

the Works means the whole of the work to be carried out and completed in accordance with the Contract including variations provided for by the Contract, which by the Contract is to be handed over to the Principal. 

  1. [145]
    Item 10 stated, as the Principal’s project requirements, “Preliminary design”.  I note that it did not include, as it was supposed to, “the stated purpose” of the Works. 
  2. [146]
    The Preliminary Design documents (as per Item 11) were “Documents Register (sic) under Annexure Part G.  They included inter alia the Architectural Plans prepared by Hooker Design Consultants; Drawings; and the Schedule of Finishes prepared by One Sector Pty Ltd, Tender Issue dated 1st July 2015 (sic). 
  3. [147]
    The Contractor’s warranties were set out in clause 2.2:

CONTRACTOR’S WARRANTIES:

Without limiting the generality of subclause 2.1, the Contractor warrants to the Principal that:

 (a)  the Contractor:

  1. at all times shall be suitably qualified and experienced and shall exercise due skill, care and diligence in the carrying out and completion of WUC [that is, work under the contract];
  2. has examined any preliminary design included in the Principal’s project requirements and that such preliminary design is suitable, appropriate and adequate for the purposes stated in the Principal’s project requirements
  1. shall carry out and complete the Contractor’s design obligations to accord with the Principal’s project requirements … and
  2. shall carry out and complete WUC in accordance with the design documents so that the Works, when completed, shall:
    1. be fit for their stated purpose; and
    2. comply with all the requirements of the Contract; and

subject to clause 9, the consultants identified in the Contractor’s tender are suitably qualified and experienced.

  1. [148]
    The Contractor’s obligations, set out in clause 2.6, contained an acknowledgment that the Principal was relying on its advice, skill and judgment in the design, construction and completion of the works.  
  2. [149]
    Clause 2.7 contains further warranties, including, at (a), that the Contractor warrants that “it shall construct the Works in accordance with the Contract Documents, employ industry best practice and quality materials using materials of the nature described in the Contract, or if two or more materials are specified, the higher standard”; and at (b), that “the Works will when constructed comply with all the requirements of the Contract, all Building Codes and be fit for their intended purpose …” 
  1. [150]
    Clause 20 required the Principal to ensure that at all times there was a Superintendent, who was to be appointed by the Principal.  The Superintendent had certain functions under the contract.  
  2. [151]
    Clause 29.1 required the Contractor to use “suitable new materials and proper and tradesmanlike workmanship”.  
  3. [152]
    The Part A annexure nominated GMP Management as the Superintendent.  It stated that the Preliminary Design was at Annexure Part G.
  4. [153]
    The Scope of Works were in Annexure Part F.  I note that the Principal was required to approve all design documentation.  
  5. [154]
    The second half of Annexure F[25] referred to One Sector’s Tender Letter dated 30 May 2015 and reproduced it, or some of it.  
  6. [155]
    That which was reproduced in Part F was not identical to the Tender Letter of 30/5/2014 (sic) (see, for example, items 4.3, 5.1, 6.6, 6.7, 8.2, 12.1, 14.2, 18.1 and 20.7).  There were also differences in the Exclusions.  
  7. [156]
    The Tender Letter itself concluded with notes which included three statements:
    •  Quote Valid for 30 days
    •  One Sector Pty Ltd standard terms and conditions apply
    •  Final design and plans to be approved by client.
  8. [157]
    None of those statements appeared in Annexure Part F.  
  9. [158]
    The parties had originally contemplated a 150 mm thick slab, which would not allow tenants to place walls anywhere without additional footings.  The Scope of Works dealt with the footings in paragraph 6 (this is relevant to the assertion that the slab was not thick enough):

In addition to the items specifically noted in One Sector’s tender offer dated 30 May 2014, the following additional works have been agreed to be included in the Contract Sum

  1. …
  2. Additional structural foundations/footing constructed at agreed intervals every 500m2 of NLA to provide future provision for inter-tenancy walls.  Alternatively, if the slab thickness of 175mm is suitable to structurally support the walls without additional footings, then the footings do not need to be provided. 
  1. [159]
    One Sector chose the second option: a 175 mm thick slab.  The Scope of Works noted that One Sector provided additional scope clarification on 9 July 2014: 

Internal slabs to be 175mm thick removing the need for internal footings and effectively allowing any wall to be built anywhere in the factory.  

  1. [160]
    Under the heading “Concrete”, the Scope of Works relevantly provided for:

…

  1. Internal slabs 175mm with 32 MPa concrete with Helix Fibre Reinforcement Engineering
  2. External Driveways 175 mm [with] 32, MPa concrete reinforced with F82 mesh

…

 12  All concrete to be sealed using densifier product. 

  1. [161]
    The Helix Fibre Reinforcement and the densifier were of relevance in this matter.
  2. [162]
    Mr Ray said that he signed the Stage 1 contract, which included the Australian Standards contract’s terms and conditions, because “GMP”, a “client-side project management organisation” with “a good reputation”, had been engaged by Hestbay.  He said that, with GMP involved, he “put aside his usual concerns about using an Australian Standards Contract for a development”.  Mr Ray did not elaborate upon his “usual concerns”.  He said nothing about appreciating that the AS 4902 contract required a Superintendent.  
  1. [163]
    According to Mr Hutchins, GMP ceased its involvement in the project about half-way through the Stage 1 build (although this does not seem to be borne out by the evidence which showed GMP’s involvement until the practical completion of Stage 1).  
  2. [164]
    Mr Hutchins said that the reason he engaged GMP was because he had no prior experience in construction or building management.  He said that the decision to cease GMP’s involvement was purely commercial and that, having worked closely with GMP, he considered himself able to take on their responsibilities.  He said nothing about appreciating that the AS 4902 contract required a Superintendent.  

The engineers’ specifications for the concrete slabs

  1. [166]
    The engineers’ construction notes for Stage 1 and Stage 2, which were to be read in conjunction with the engineering drawings, were identical.
  2. [167]
    They explained that the structural work for the 175 mm ground slab had been designed for a uniform load of 20.0 kPa and a point load of 48.0 kN.[26]
  3. [168]
    At L4, they discussed slab loading (my emphasis): “The 175 thick ground slabs in this development have been designed for heavy duty vehicle traffic, not exceeding 40 tonnes gross single wheel load, or 4.8 tonnes gross dual wheel load.  The slabs have been designed for pneumatic tyred vehicles only, hard wheeled forklifts and machinery have not been allowed for in the slab design”.  
  4. [169]
    Concrete is dealt with at C1 – C29.  Relevantly, the notes state:

C1  All workmanship and materials shall be in accordance with AS 3600 concrete structures and the referenced standards therein.

C2  The concrete strength grade and the cover to reinforcement for the various concrete elements shall be as listed below:

 

Surfaces in contact with ground

Interior surfaces

Exterior surfaces

Element

Strength Grade

Cover 

Strength

Grade

Cover

Strength Grade

Cover

Footings

N25

50

-

-

 

 

Ground Slabs

N32

50

N32

30

N32

40

Precast Walls

-

-

N32

40

N32

40

C3  Concrete to have a maximum aggregate size of 20 mm with 80 mm maximum slump, a water/cement ratio of not greater than 0.65 and a maximum final basic drying shrinkage strain of 800 x 10, unless approved otherwise.

…

C7  All concrete shall be sampled and tested in accordance with AS 1379 adopting the project assessment method for compressive strength and slump compliance.  The results of all tests shall be promptly submitted to the engineer for review.  

  1. [170]
    As explained above, the “grade” of concrete is a reference to its strength.  “Grade N32 concrete” means concrete with a characteristic compressive strength of 32 MPa at 28 days after its pour.   
  2. [171]
    As per AS 3600, the N32 concrete slab was suitable for pneumatic tyred vehicle traffic only. This was spelt out in note L4.  Pneumatic tyres are air filled tyres.  Rubber tyres are either pneumatic or non-pneumatic (solid rubber).  Polyurethane tyres are all solid or non-pneumatic.
  3. [172]
    Although the engineers specified concrete with an 80 mm slump for the slabs, One Sector ordered concrete with a 100 mm slump because it considered it preferable to do so.  
  4. [173]
    Under the heading “Concrete Shrinkage Cracking”, the notes state at CS2, “Water must not be added to the concrete mix after it leaves the batching plant unless ordered by the supplier”.  
  5. [174]
    The supplier provided a docket with each load of concrete delivered for the Stage 2 slab.  The dockets were in evidence.  Each docket included provision for information about the amount of water which had been added to the mix by the supplier (the “slump stand water”) and provision for an instruction about the maximum volume of water which might be added on-site.

The leases

  1. [176]
    Mr Hutchins ran the lease negotiations for the warehouses. Upon handover, he received hard copy versions of Westera’s engineering drawings.[27] However, he did not have regard to the notes to the drawings about the limit to slab loading weights or appropriate vehicles when he was negotiating the leases.  Indeed, he was not aware of the loading or pneumatic tyre constraints or limitations which applied to his warehouses.[28]  
  2. [177]
    Appendix 1 to this judgment sets out the details of the leases and the tenants in each stage.  The Stage 1 tenants were Chempro and Viadux.  The Stage 2 tenants were TNT, Budget Pet Products and EZFurn.
  3. [178]
    The tenants in both stages used similarly wheeled vehicles, as set out in Appendix 2, but there was no expert evidence tendered about comparative loads, traffic patterns or traffic volume, as between Stage 1 and Stage 2.  Regardless, and to the plaintiff’s benefit, I proceeded on the basis that each slab was used similarly.  
  4. [179]
    The lease from Hestbay to Budget Pet Products, which commenced on 1 May 2017, included clause 7.1 “Floor Overloading”, which stated at 7.1.1:[29]

The Lessor shall advise and the Lessee shall observe the maximum floor loading weights for which the Premises were designed and the Lessee shall not permit the floor of the Premises to be broken, strained or damaged by overloading in any manner howsoever.   

  1. [180]
    Clause 7.1 of the Viadux lease; clause 5.11 of the Chempro lease; and clause 7.1 of the Ferris Wheel Productions (that is, EZFurn) lease were in similar terms.  A similar clause (5.14) was in Budget Pet Product’s Stage 2 lease.[30] The TNT lease contained no equivalent clause.
  2. [181]
    Notwithstanding the lease terms, Mr Hutchins did not provide the floor loading limits to any of his tenants.  Nor did he tell them not to exceed certain loads, as per the design drawings.  Nor did he inform them that the slab had not been engineered for hard wheeled forklifts or machinery.  Nor did he tell them to only use pneumatic wheeled vehicles on the slab.  
  3. [182]
    Mr Willmott was responsible for overseeing the fit outs of the tenancies to ensure that the tenants were complying with their leases and statutory requirements.  He could not recall whether he had been given the engineering drawings which showed the floor loading requirements or limitations for Stage 1.  Regardless, he did not speak to any of the Stage 2 tenants about slab loading limits.  He was not given a copy of the leases and was not responsible for informing tenants of the loading limits for the slabs.   
  4. [183]
    Coming back to the TNT lease: I note that a report by Colliers for TNT entitled “Condition of Premises Report” is included in the trial bundle.[31] Unit 9 was then brand new.  For what it’s worth, the report described the internal floors as “new unpainted, sealed concrete.  No visible cracks or damage”.  No one from TNT was called as a witness.

Tenants’ complaints about the Stage 1 and Stage 2 slabs

  1. [184]
    There were complaints from the tenants about the Stage 1 and Stage 2 slabs. 
  2. [185]
    Mr Hutchins and Mr Willmot discussed the tenants’ complaints with Mr Ray.  The complaints about the Stage 1 slab were not as serious as the complaints about the Stage 2 slab and were addressed by remedial work, to the apparent satisfaction of the plaintiff.  
  1. [186]
    With respect to the Stage 2 slab, Mr Ray’s position was then as it is now: the Stage 2 slab was not deficient – it was damaged by the hard wheels on the tenants’ vehicles, for which it was not engineered.
  2. [187]
    The complaints are set out below.

Viadux (Stage 1)

  1. [188]
    Ms Doblo, the Distribution Centre Supervisor at Viadux, considered the slab to be in a satisfactory condition at the commencement of the lease on 29 September 2015.  
  2. [189]
    Hestbay’s site had been previously occupied by Southport Timbers.  The internal concrete slabs of Viadux’s units were constructed by One Sector over the original internal concrete slabs.  The new concrete slab extended beyond the original slab at the rear section of the warehouse (the “Overlay”).  The Overlay had minor wear and cracking.[32]  
  3. [190]
    In February 2020, Ms Doblo complained to Mr Willmott about the formation of potholes along the western side of the warehouse and cracks appearing in the concrete slab, including in the Overlay.[33] Hestbay arranged for minor remedial work (by One Sector) to fill in surface cracks on two occasions.  In March 2020, upon an inspection of the entire Viadux slab, Mr Ray said that he was happy with the repairs.[34]
  4. [191]
    On 25 August 2022, Mr Willmott inspected the slab and observed minimal wear and tear since his own inspections of it in 2020.  
  5. [192]
    Ms Doblo arranged for the warehouse to be swept approximately once per week.  She estimated the total machinery drive across the areas of the units with the highest volume of traffic to be 35.5 hours per month – that is, the main forklift traffic area.  Her business used five forklifts.
  6. [193]
    Mr Willmott observed that Viadux supplied significant civil, plumbing and infrastructure components, many of which were composed of cast iron.  He estimated that the loads carried by the forklifts in Viadux could be as heavy as a tonne.  

Chempro (Stage 1)

  1. [194]
    Mr Markwell, the Warehouse Manager of Chempro, said that there were visible defects in the internal concrete slab of the units when Chempro’s lease commenced in February 2016, including minor cracking inside the roller doors.  Repair works were carried out to remedy those defects.  
  2. [195]
    On 25 August 2022, Mr Willmott inspected the slab and observed minimal wear and tear to it since his inspections of it during 2020 (the 2020 inspection had been made after Ms Doblo’s complaints).  However, by October 2022, the front area of the internal warehouse floor had experienced further cracking, which resulted in the accumulation of excess dust in that area.  
  3. [196]
    Mr Markwell arranged for the warehouse to be swept and vacuumed approximately once per week.  There was also dust from outside the unit which needed to be cleaned.  
  4. [197]
    The highest volume of traffic was at the receiving roller doors, at which Chempro could receive up to 15 pallets per day, and at the site of the roller doors in front of gates 1 and 2, which was attended by three vehicles per day.  Mr Markwell estimated that wheeled machinery traversed those areas for about 6 hours per day. 
  5. [198]
    Neither the cracking nor the dust interfered with Chempro’s business.   

EZFurn (Units 10 and 11, Stage 2)

  1. [199]
    At the commencement of the lease, on 1 August 2018, Mr Rex of EZFurn considered the concrete slab to be in a satisfactory condition with no visible defects.[35]  
  2. [200]
    However, by October/November 2018, EZFurn noticed deterioration in the slab, including cracking in and around the expansion joints.  According to Mr Rex’s affidavit, dusting became an issue.  The deterioration was mainly in the high traffic areas – such as in the aisles between the racking and the loading area in front of the racking.[36] An email from Matt Ferris of EZFurn to Mr Willmott, dated 4 October 2018, asked Mr Willmott to “drop by” because the “amount of cracking on the expansion joins (sic)” was “higher” than Mr Ferris thought was “reasonable ‘wear and tear’ in a short period”.[37]  
  3. [201]
    Mr Hutchins said he raised with Mr Ray his own concerns about the concrete cracking in Units 10 and 11 in around October 2018, but Mr Ray said that the damage he observed was not shrinkage or map cracking.[38] I note Mr Ray’s email to similar effect (errors as per original):[39] 

John

Ive inspected the cracks with the tenant and he has advised the request was precautionary associated with the long levity of the slabs.

There are no cracks so to speak, however, there is some chipping on the saw joints caused by heavy lifting equipment, containers, steel wheel bins etc.  I see this as been common with these types of  machinery and can advise that the only way to prevent further chipping would be to fill the saw cuts with a hard but flexible product in the high use areas.  

It's not classed as a defect rather an ongoing maintenance issue, however, if you do want to have further works performed, we will be happy to help find a suitable product to help your tenant.

  1. [202]
    In early 2019, the cracking at the expansion joints was remedied to reduce the damage to the tyres of the forklifts and order pickers.  The remedial work involved filling the expansion joints to provide for a smoother surface for the tyres to traverse.  In Mr Rex’s opinion, the repairs were suitable.  
  2. [203]
    In 2020, EZFurn bought a ride-on sweeper and a new push sweeper to deal with the dust, which Mr Rex said had been an issue since the deterioration of the slab in 2018.  One staff member is allocated two hours, three times a week, to operate the sweepers to ensure that the furniture stored in the units is not affected by the dust.  
  3. [204]
    In 2022, EZFurn exercised the additional four-year option on its 2018 lease and agreed to an increase in rent.  
  4. [205]
    Mr Rex’s oral evidence was not as negative about the slab as his affidavit evidence.  In oral evidence, Mr Rex agreed that the warehouse was suitable for his business.  He agreed that the dust in the warehouse had not interfered with his business.  He said, “Oh it’s the nature of the business”.  Nor had the cracking interfered with his business since its repair in 2018.[40]
  5. [206]
    As at 22 November 2022, Mr Willmott observed that the dusting and deterioration of the internal concrete slabs in Units 10 and 11 was significantly greater than that observed in the Stage 1 tenancies.  Though, on the strength of his oral evidence, it did not appear to trouble Mr Rex. 
  6. [207]
    The slab in Units 10 and 11 was the only uncovered Stage 2 slab available for inspection by the experts for the purpose of this litigation.  Upon their examination of it: 
    1. Dr Woolcock, the plaintiff’s expert, stated that he was of the view that forklifts in Units 10 and 11 were not able to function in a safe and efficient manner and that the dusting not only required frequent vacuuming but was also a health hazard.[41]  
    2. Yet Mr Munn, one of the defendant’s experts, saw no limitation on the operation of the forklifts.  Nor did he consider the dusting a health hazard. 
    3. Dr Khan, another of the defendant’s experts, found the slab in a satisfactory condition, with minor defects in select areas, including fretting, surface breakdown and exposed aggregate at joint locations.  He thought it highly likely that the concrete had been ground on either side of the joints and that the surface breakdown was a consequence of its being ground.  He also observed plastic shrinkage and plastic settlement cracking.    

Budget Pet Products (Units 12 and 13, Stage 2)

  1. [208]
    Karla Vandepol, a director of Budget Pet Products, considered the concrete slab to be in a satisfactory condition with no visible defects when the lease commenced in May 2017.  However, in around mid to late 2018, she noticed that the internal concrete slab was showing signs of wear and tear, including: a weakened surface layer and surface breakdown; surface abrasion and disintegration; widespread dusting; and cracking.
  2. [209]
    Ms Vandepol spoke to Mr Hutchins about the issue.  The defects of most concern were in the high traffic areas of the units.  Ms Vandepol also complained that the stock being transported by hand-pushed trolleys could not always be balanced: the trolleys shook and juddered because the surface over which they traversed had worn unevenly.  
  3. [210]
    Alex Vandepol contacted Mr Willmott about the issue and sent him relevant photographs.[42] Mr Vandepol complained that their machinery had to travel over the problem spots daily and it was causing damage to the drive wheels.  The photographs were sent on by Mr Willmott to One Sector.[43] It appeared to Mr Willmott that the top layer of the slab was “disintegrating” at the joins.[44]
  4. [211]
    On 22 August 2019, Mr Willmott received an email from One Sector advising that the defects complained of were due to the rigid wheels on the machinery used by Budget Pet Products.  They were not due to defective workmanship.  One Sector’s advice was to use softer wheeled vehicles with less impact.[45]
  5. [212]
    In February 2020, Mr Willmott met with Mr Ray, Mr Hutchins, and another One Sector employee (Mr Wayman) to inspect the slab.  According to Mr Willmott, Mr Ray said inter alia that One Sector would arrange for a product to be applied to the surface of the slab to increase its hardness and to minimise future wear.  (I infer, from other evidence, that Mr Ray was referring to a densifier.)  In other correspondence dated 4 March 2020, Mr Ray said that the slab in Units 12 and 13 was under extremely heavy use and that there had been no structural failure:[46]

John/Bruce

We have investigated the pet foods unit regarding wearing concrete surfaces and attached the following as an option you could use to prevent further wearing and repair the areas required.

The slab is under extremely heavy use with multiple forklifts running 10 m high racking front to back so it would not be uncommon to have wear and tear and further works required to protect the surfaces.  Please note once a slab surface is reduced to the stone beneath the surface it generally won’t go much further rather than create a ruff surface which causes forks to bounce more which will exacerbate the problem.  I strongly recommend yearly maintenance for heavy use area with machine and fork movement. 

There is no structural failure associated with the works we have inspected.

Please note the building was constructed in accordance with the relevant Aus Standards, contractual requirements, Approved Engineering designs and the defects liability period ended on 2/8/2017.

We reserve our rights in relation to any previous offers to help rectify the problem and state that offers were based on a client relationship basis as we are not required under our QBCC licence or contractual requirements to maintain concrete surfaces.

I’m happy to discuss options with John to work out a solution to maintain relationships between the tenant client and ourselves.

Kind regards, Nick Ray 

  1. [213]
    I note that it is implicit in Mr Ray’s email that the slab surface had been reduced to the stone beneath the surface on the trafficked, or heavily trafficked, areas; and that there was a problem with the concrete.  His statement about the defects liability period ending on 2/8/2017 is relevant to the “what contract governed Stage 2” issue, and is discussed below.  
  2. [214]
    I have assumed that the document at pages 2092 and 2093 of the Trial Bundle is the document which was attached to the email.  It offered two remedial options: (a) the application of “BASF MasterTop XTC” which was “a high performing flooring system based on Xolutec technology” at an afterhours rate of $79 per linear metre, + GST; or (b) the application of “BASF 333”, which was “a dust arresting and penetrating and hardening sealer” at an afterhours rate of $14 per linear metre, + GST.  
  3. [215]
    On 26 March 2020, Mr Willmott inspected the slab and noticed that it was continuing to deteriorate. On 21 May 2020, Mr Willmott observed that the worst of the failures/wear were in the aisles of Unit 12.  
  4. [216]
    Kustom Flooring installed an epoxy or polyurethane sealant (BASF Ucrete MF)[47] at certain locations in Units 12 and 13 in November 2020; December 2020; and January 2021, at Hestbay’s expense.  
  5. [217]
    In March 2021, staff were required to wear face masks because of the COVID-19 pandemic.  Ms Vandepol noticed dust accumulating on the outside of the masks.  
  6. [218]
    The sealant which had been applied reduced the dust in the warehouse and the wear and tear on the equipment, but untreated areas of the slab showed signs of degradation, with the top layer crumbling and powder starting to form.[48] More remedial work was required and was ultimately performed in or around July 2021.   
  7. [219]
    As at 12 October 2022, Ms Vandepol still required her staff to wear masks because of the dust.  She reported significant deterioration in the areas in which no sealant had been applied.  
  8. [220]
    As at 22 November 2022, Mr Willmott observed that the dusting and deterioration of the internal concrete slabs in Units 12 and 13 was significantly greater than that observed in the Stage 1 tenancies.  
  9. [221]
    In her oral evidence, Ms Vandepol described the concrete “everywhere” as very powdery.  That included in the car parks, which also required daily floor vacuuming or sweeping.  (She said they originally used vacuums but they “blew them all up” and replaced them with a sweeper.) Ms Vandepol said, “The dust is through the entire building, but in the unsealed areas, I guess it cakes more, if that makes sense.  It piles up higher.”  She agreed that the interior dust included dust blown in from outside.  She said (my emphasis):[49]

… the more you use it anywhere where there’s lots of trucks, forklifts or foot traffic, the dust is quite significant.  So to – the neighbours were complaining that the dust was coming in, so we were trying a bigger car park to reduce that.  But that also was to reduce it coming in our warehouse if it was coming from the car park.

  1. [222]
    The fact that Ms Vandepol complained of powdery, dusting concrete in the car parks was interesting because of the strength of the car park slabs.  The concrete outside Units 12 and 13 was more than 60 MPa, correcting Dr Woolcock’s results as required by Clause B6.4.2 of Appendix B of AS 3600.[50]  
  2. [223]
    Ms Vandepol agreed that trucks were constantly coming to and going from the warehouse and that there were always steel cages and pallets on the driveway waiting to be delivered or collected. 
  3. [224]
    She said that there was an extensive clean of the warehouse, including under the racking, using a vacuum cleaner or sweeper, on the last Friday of every month.[51]  This seems to be in addition to the daily sweeping referred to above.  There had been no testing of the dust inside the units to confirm that it was concrete dust.  
  4. [225]
    Before Budget Pet Products moved into Unit 9 (in March 2021), all high picking in Units 12 and 13 was done by hand and moved onto trolleys.  Ms Vandepol estimated that foot traffic and trolley use accounted for about 95 per cent of the traffic in the warehouse.  
  5. [226]
    Ms Vandepol estimated that – 
    1. the pickers used the “foot traffic trolleys” for approximately 7.5 hours per day;
    2. the pickers operating in the G-Zone (the majority of the floor area of Unit 13) transported up to 250 items per day in that zone, picking and stacking goods onto trolleys; 
    3. up to 160 spots with pallets were replenished monthly;
    4. approximately 3 – 4 times per day, an order picking machine was used down various aisles to move parcels from one end of the building to another;
    5. for approximately 8 hours per day, three staff used hand pushed trolleys;
    6. for approximately 8 hours per day, three staff used steel capped boots to push the trolleys which carried between 25 and 30 kgs; and
    7. one pallet jack was used approximately 10 – 16 times a day to move freight cages out of the building.
  6. [227]
    According to Ms Vandepol, the warehouse floor showed signs of dusting and degradation which was disproportionate to the way in which the warehouse was being used.  (Although Ms Vandepol was unlikely to know that the slab was not engineered for hard wheeled vehicles.)  In addition to the need for daily sweeping or vacuuming, the defects in the slab caused damage to the tyres of the machines used by the business. 
  7. [228]
    In 2022, Dr Khan observed cracking and a combination of shrinkage and plastic settlement cracking in a few uncoated panels of units 12 and 13.

Budget Pet Products (Unit 9, Stage 2)

  1. [229]
    In late February 2021, before the lease of Unit 9 commenced, Ms Vandepol told Mr Willmott that she saw similar concrete failures in Unit 9 to those she’d seen in Units 12 and 13 and that something had to be done.  Mr Willmott took photos of the Unit 9 slab.  
  1. [230]
    Upon moving into Unit 9, Ms Vandepol sent an email to Mr Hutchins on 25 February 2021[52] stating her concern about the condition of the floor of Unit 9.  She reported in that email “wear on all cracks and even breaking away in many spots”.
  2. [231]
    Mr Willmott arranged for the slab to be ground and a sealant applied.  Mr Willmott observed that, thereafter, Unit 9 did not have the same dust issues as Units 12 and 13, which had only been partially treated with the sealant.  
  3. [232]
    In oral evidence, Ms Vandepol said that, while there was still dust in Unit 9 after the topping was applied, it was “nothing like” the dust experienced in Units 12 and 13.  Common sense suggests that the dust still in Unit 9 could not be from the “powdery” interior slab, because it had been sealed.
  4. [233]
    Ms Vandepol estimated that during business hours in Unit 9 – 
    1. 2 x high reach machines operated for 7.5 hours per day, constantly moving up and down the aisles;
    2. Approximately 4 – 5 order pick machines operated for 7.5 hours per day, moving up and down the aisles which had a “snake like system for high weight picking”; and
    3. One forklift operated for 4 hours per day, taking full freight cages out of the warehouse.

Hestbay’s investigation of, and response to, the complaints 

  1. [234]
    This section of the judgment deals with the steps taken by the plaintiff before this litigation commenced.  This evidence relates to the reasonableness of the remediation steps taken by the plaintiff, the cost of which it included in its damages claim.  In effect the plaintiff submitted that it took the steps it did, and arranged for an epoxy coating on units 9, 12 and 13, on the advice of experts.  The defendant’s position was that the application of an epoxy sealant amounted to betterment of the slab.
  2. [235]
    Mr Hutchins inspected the defects complained of in about August of 2019.  He noticed surface disintegration and visible cracking of the Stage 2 slab.  
  3. [236]
    The first core samples were not taken until June 2020.  No abrasion test was ever undertaken.[53]
  4. [237]
    On 23 April 2020, Shane Roberts from Structural Diagnostics, who had been engaged by the plaintiff to inspect the slabs, sent an email to Mr Willmott advising him of issues with the integrity of the internal concrete slabs and his recommendations for their repair.  On 27 April 2020, Mr Roberts sent an email to Mr Willmott attaching an Inspection Report.  Mr Roberts was not called as a witness, nor was this report before me as evidence of the state of the slab.
  5. [238]
    On 13 May 2020, Mr Willmott issued a “notice to rectify defects” email to Mr Ray.[54]  The notice identified the slab in Units 12 and 13 as the most defective but noted issues with Units 9, 10 and 11 as well.  
  6. [239]
    On 6 July 2020, Tim Peters from Edge Consulting sent Mr Willmott a Structural Assessment of Concrete Slab on Ground for Units 12 and 13 (dated 6 July 2020) and a factual report prepared by Griffith University (dated June 2020).  Mr Peters was not called as a witness nor was his report, nor the Griffith University report, before me.
  7. [240]
    On 8 July 2020, Mr Willmott prepared a Slab Report in respect of Units 12 and 13 for Budget Pet Products – but it was not in evidence before me.  
  8. [241]
    As mentioned above, Hestbay then engaged Kustom Flooring to treat the slabs in Units 12 and 13, and later Unit 9, with an epoxy sealant.  
  9. [242]
    I note that, on 17 July 2020, Kustom Flooring advised Hestbay that it was unable to provide a warranty for MasterTop XTC and BASF Ucrete MF (the sealant) “because of the deficient strength of the substrate”.  

Mr Ray’s observations of the Stage 2 units

  1. [244]
    Mr Ray’s evidence suggested less damage to the Stage 2 slab than the tenants complained of.  Some examples of the diverse evidence are set out below.  However, neither Mr Ray, nor Mr Hutchins, nor Mr Willmott, nor the tenants were challenged about their descriptions of the state of the slab in cross-examination.

Unit 9

  1. [245]
    Mr Ray did not see (between 2016 and 2019) any wearing, abrasion, cracking or dusting of the internal slab in Unit 9.  In contrast, it will be recalled that Ms Vandepol claimed that, prior to the application of the sealant (an epoxy, BASF Ucrete MF), the Unit 9 slab was “powdery and showed similar failures [to those] present in Units 12 and 13”.

Units 10 and 11 

  1. [246]
    Mr Ray was made aware of complaints about cracks in the slab in units 10 and 11 in October 2018.  He inspected the units.  He could not see any shrinkage cracks or map cracking.  The cracks complained of were “joint chipping around the slab joints (where the slabs butt up against each other), along the front, in the loading and unloading areas, where forklifts did their main running around”.  He explained that joint chipping may occur when the concrete either side of the slab is chipped out because of machinery or traffic travelling over the slab joint.  The slab joint becomes a bump and, every time it is traversed by machinery or traffic, there is more joint chipping, which becomes wearing unless it is stopped.
  2. [247]
    Mr Ray saw that EZFurn was using two or three trolleys and three or four forklifts, with non-pneumatic tyres, to move furniture around.  
  3. [248]
    In July 2022, Mr Ray saw the joint chipping and wear around the slab joints in the loading and unloading bays referred to above.  He also saw slight (less than 3 millimetres wide) hairline cracking in the area but no other cracking, including map cracking.  He saw “new wearing” in the loading and unloading area which was traversed by non-pneumatic tyred machinery.  Mr Ray saw no dust in July 2022, including under the racks in those units.  
  4. [249]
    In contrast, Mr Hutchins said that the cracks he saw during the same time period were greater than 3 mm wide on his estimate.  

Units 12 and 13

  1. [250]
    Mr Ray was made aware of Budget Pet Products’ concerns about the wear of the slab in about August 2019, at which time, he said, concerns were raised about Unit 12 only.  
  2. [251]
    Mr Ray noticed that a patch of concrete had become rough and worn towards the back of Unit 12.  The patch was on either side of an armour joint (a metal joint between two slabs of concrete).  It ran perpendicular to the racks in unit 12.  The metal armour joint had become a bump because the concrete either side of it had been chipped out.  As machinery traversed the bump, the concrete developed wearing.
  1. [252]
    In contrast, Ms Vandepol said that the damage in Unit 12 (and 13) was not limited to damage either side of the armour joint.  There was general wearing up and down the aisles in various places in Unit 13.  
  2. [253]
    Mr Ray saw chipping out and wearing in Unit 12, at its edge, along the boundary to unit 13.  The patch on the boundary ran parallel to the direction of the racks in Unit 12.
  3. [254]
    Mr Ray did not see any cracking of the slab.  He did not see dust, including under the racks.  He saw no-one in a mask; nor was he asked to wear one.  Ms Vandepol confirmed that masks were required when sweeping was carried out under the racking because of the volume of dust which accumulated.
  4. [255]
    In Mr Ray’s view, apart from the two patches mentioned above, the concrete appeared to him to be in the same condition as it was in when it was laid.  
  5. [256]
    Mr Ray inspected Units 12 and 13 again in July 2022.  He saw the sealant.  In his opinion, the slab was in excellent condition, with no cracking, despite the continued use of the hard wheeled vehicles.  In contrast, Ms Vandepol complained that, as at June 2023, Units 12 and 13 continued to experience widespread dusting which accumulated on the floor of the warehouse (as per the photo taken on 15 June 2023). 

Hestbay’s claim in brief 

  1. [257]
    Hestbay brought a claim against One Sector seeking inter alia damages: (a) for breach of contract; (b) for negligence; and (c) under section 236 of the Australian Consumer Law, for contravention of section 18 of the Australian Consumer Law.  (At this stage of the judgment, I will not deal with One Sector’s counter-claims.)
  2. [258]
    In its final statement of claim (its third) Hestbay asserted the following (my emphasis):

In breach of the Defendant’s obligations under the Contract:

  1. (a)
    the Internal Concrete Slabs [of Stage 2] … did not meet the Concrete Specifications in the following respects:
  1. it did not have a thickness of equal to or greater than 175 mm across the entire area of the slab 
  2. it had a maximum (sic) compressive strength of less than 32 MPa as identified in the table at Appendix A attached to this pleading, with representative compressive strengths of each core sample identified (to the date of this pleading and corresponding to the identified locations across Units 9, 10, 11, 12 and 13 respectively) as marked up on the general Plan contained in Appendix B to this pleading

(One of the particulars to this paragraph stated (my emphasis):  The compressive strengths identified as being at or below 35 MPa in Appendix A were, at or about the time of practical completion of the Contract, or in the alternative 28 days after they were poured, less than 32 MPa by reason that concrete strength increases over time.  The Plaintiff adopts a conservative estimate of a minimum strength increase of 10 % over 6 years.)

  1. – 
  2. – 
  3. The Defendant ordered and used concrete with a 100 mm slump, not the maximum 80 mm slump specified.
  1. (V)(A)
    The Defendant added water to the cement delivered to the Land in excess of the maximum water/cement ratio of 0.65.
  1. [259]
    Hestbay also asserted that One Sector did not carry out its work using “proper and tradesman like workmanship” nor did it use due skill care and diligence; nor was the Stage 2 warehouse complex “fit for purpose”.  
  2. [260]
    The particulars of the “fit for purpose” allegation included an assertion that being fit for purpose would mean that “the tenants or other persons occupying the land could reasonably use the relevant land for their intended purpose, including as industrial or warehouse premises”.  
  3. [261]
    Hestbay asserted that the slab was deteriorating and dusting to the point at which the tenants’ employees were wearing masks to avoid concrete dust inhalation.  
  4. [262]
    With respect to slab thickness, Hestbay asserted that although the slab had a thickness of 170 mm (which allowed for a 5 mm tolerance from the specified 175 mm) at certain locations, at other locations, it was thinner.
  5. [263]
    “Appendix A” of the plaintiff’s statement of claim contains tables which set out the average corrected core strengths of samples taken from Units 9, 10 and 11, and 12 and 13 and the standard deviation for each – based on Dr Woolcock’s calculations.  Dr Woolcock’s use of “average corrected core strength” to demonstrate a strength of less than 32 MPa was challenged by the defendant’s expert.  As will emerge, Dr Woolcock acknowledged that he ought to have multiplied his results by 1.15.
  6. [264]
    With respect to the addition of water in excess of the ratio of 0.65, the Plaintiff relied upon a summary of the concrete delivery dockets prepared by Dr Woolcock and annexed to the statement of claim.  Dr Woolcock’s summary contained some errors which were detected by me during the hearing, and which were corrected by him in an affidavit dated 15 October 2023.  But, corrected or not, the summary dealt only in “raw” data.  For example, it did not calculate whether the amount of water added per load exceeded 10 litres per cubic metre (which was relevant to the plaintiff’s argument that too much water had been added).  And, relevantly to the allegation that the water to cement ratio exceeded 0.65 after its pour, Dr Woolcock could not have calculated it, even if he thought to, because he was not told, nor was there evidence about, the water to cement ratio in the cement mix when it left the supplier, prior to its pour.   
  7. [265]
    Hestbay asserted that the breaches it identified impeded the use of the Stage 2 warehouse because the deteriorating slab inhibited the reasonable use of the premises as industrial or warehouse premises – causing loss to Hestbay.  Also, because the slab was too thin in certain locations, the use of the land by current or future tenants was inhibited because they were unable to erect walls at any location in the building – causing loss to Hestbay.
  8. [266]
    As set out in its outline, Hestbay asserted that its loss and damage included – 
    1. Interim rectification works to Units 9, 12 and 13.
    2. Future rectification works – by way of the demolition and removal of the existing slab, followed by its replacement with a 40 MPa slab or a slab built to specifications (that is, inter alia, 32 MPa and 175 mm thick).
    3. Loss of rental income, while rectification works are undertaken.
  9. [267]
    In the alternative to (b), if the court were to find the rectification works not reasonable and necessary, Hestbay asserted that its loss was to be calculated on the basis of the diminution of value of the property.

One Sector’s response in brief 

  1. [268]
    In brief, One Sector and Hestbay disagreed about the terms of the Stage 2 contract.  One Sector contended that the Stage 2 contract did not include the Australian Standards’ contract’s terms and conditions.  This was relevant to the “not fit for purpose” claim and whether specified design elements (such as slump and the water to cement ratio) were conditions of the contract. 
  1. [269]
    One Sector asserted that – 
    1. the Stage 2 warehouse was fit for its purpose as an industrial building, with its internal concrete slab designed for traffic by pneumatic tyred vehicles only;
    2. the slump and water to cement ratios were not contractual specifications;
    3. there was no deficiency in the way in which it constructed the slab;
    4. it was not understrength;
    5. it was not too thin;
    6. it did not add “excess” water; and
    7. it carried out the work in accordance with the applicable contractual warranties.  
  2. [270]
    The slab deteriorated (if that were proven) not because it was understrength or defective, but because of the Stage 2 tenants’ use of hard wheeled vehicles on it.  
  3. [271]
    Nor was a demolition and rebuild reasonable or necessary.  There were less costly, repair options available.  Also, the property had not diminished in value.

Testing of the Stage 2 slab in 2022

  1. [272]
    The Stage 2 slab was not tested, as it should have been (in accordance with the engineers’ instructions/Australian Standards) in 2016.  
  2. [273]
    The plaintiff arranged for its testing in 2020, after the tenants’ complaints.  The results of that testing are not before me.  
  3. [274]
    It was tested again in 2022, for the purpose of this litigation, in accordance with relevant Australian Standards, by CMT Labs Pty Ltd and Testcrete Pty Ltd.  
  4. [275]
    The CMT report, dated 27 August 2022,[55] states at paragraph 10:

On 22 June 2022, [the author of the report] visited the site for an initial inspection.  Surface abrasion wear and various crack patterns were observed during our inspection of unit 10 – 11 and 12 – 13.  [The author included seven photographs of the wearing and cracking in Annexure 9.]  [The author] could not observe any cracks or surface abrasion wear of unit 9 due to the epoxy layer on the slab and was not able to perform delamination test due to this.  The visibility of the slab was limited due to the pallet racking shelves, pallets, tables, machinery, etc.

  1. [276]
    I note that the author did not mention excessive dusting.[56]  
  2. [277]
    The author explained the coring and sampling process.  It was similar to the approach taken by Testcrete.[57] 
  3. [278]
    Dr Khan (the defendant’s expert) was involved in the preparation of the cores for testing by Testcrete.  As he explained, he attended the site on 29 June 2022 “for concrete core samples strength investigations”.  He marked the core locations, which were selected at random (avoiding the steel reinforcement).[58] He supervised the taking of the cores by Remedial Building Services Australia Pty Ltd.  Then they were sent to Testcrete for testing.  Dr Khan summarised the sampling and testing process as follows:[59]

28 cores were taken randomly across the various pours in accordance with AS 1012.14.  The cores were tested for compressive strength in accordance with AS 1012.9.  The number of cores taken far exceeded the minimum number of cores for strength assessment according to CIA Z11.  The cores’ strength results were analysed to determine if they could be taken to show the concrete met the requirements of 32 MPa …

  1. [279]
    There were no tests done to determine the slab’s surface hardness or abrasion resistance.

The Stage 2 contract

  1. [280]
    Each party contended for a different Stage 2 contract: either – 
    1. a partly written and partly oral AS 4902 contract, made on 10 July 2015 (Hestbay’s contention); or 
    2. a commercial contract on One Sector’s terms and conditions, as per its tender letter of 14 March 2016 or 17 March 2016 and the document entitled “Commercial Building Contract” (One Sector’s contention).  
  2. [281]
    The detail of the AS 4902 contract has been discussed under the heading “The Stage 1 contract”.  
  3. [282]
    One Sector’s commercial building contract general conditions included the following:

WORKS & CONTRACT SUM

  1. (a)
    The Contract (sic) shall carry out and complete the Works:
  1. in an appropriate and skilful way;
  2. with reasonable care and skill;
  3. in accordance with the Contract documents; and
  4. using materials that are suitable, new and free of defects.
  1. [283]
    Obviously, these warranties are not as extensive as those contained in the Australian Standards contract.
  2. [284]
    In its particulars in support of its contention that the Stage 2 contract was governed by One Sector’s terms and conditions, One Sector relied upon inter alia –
    1. Mr Ray’s sending One Sector’s Commercial Building Contract to Mr Hutchins on 30 May 2014 for the purposes of Stage 1; 
    2. Mr Ray’s sending, by email, to Mr Hutchins, One Sector’s Commercial Building Contract on 15 December 2017 (which concerned the fit out for units in Stage 2); and 
    3. Mr Hutchins’ reply to that email, “Agreed, as attached”.  
  3. [285]
    In other words, One Sector asserted that the terms of the Stage 2 contract were those originally sent for Stage 1 but rejected in favour of the Australian Standards’ contract; and those sent after practical completion of Stage 2[60] in relation to a fit out. 
  4. [286]
    Also among One Sector’s particulars was an assertion that, on 24 March 2016, Mr Hutchins collected copies of the proposed “Commercial Building Contract” from One Sector’s offices.  There was no evidence to support this assertion.  
  1. [287]
    I will turn now to the evidence about the evolution of the Stage 2 contract.
  2. [288]
    From Hestbay’s point of view, building the industrial complex in two stages was the most economical approach. 
  1. [289]
    On 9 April 2014, Mr Ray sent to Mr Hutchins his tender submission for the turnkey construction of Stages 1 and 2.[61] He quoted approximately $6 million for the design and construction of Stage 1 and about $6.5 million for the design and construction of Stage 2.  
  2. [290]
    According to Mr Hutchins, he and Mr Ray agreed that there would be separate contracts for each stage, but they would be substantially the same when it came to the design and specifications of the buildings and their terms and conditions.
  3. [291]
    Mr Ray said that he and Mr Hutchins did not agree to proceed on separate contracts for each stage which would be in substantially the same terms, conditions, design, and specifications.  He said that he knew Mr Hutchins wanted to develop the site in two stages, but One Sector was not initially engaged to build both stages.  He said that, apart from infrastructure built by One Sector which was common to both stages, he treated Stage 1 as separate from Stage 2.  
  4. [292]
    Mr Ray’s position was initially, in effect, that he tolerated the Australian Standard contract conditions for Stage 1 but contracted for Stage 2 on the basis of One Sector’s standard contract conditions.  However, his oral testimony did not support that position nor did the documentary evidence.  
  5. [293]
    GMP was not involved in the development of the Stage 2 contract.  Nor were lawyers engaged by either party.  Mr Hutchins and Mr Ray discussed the “contract” between themselves.  
  6. [294]
    It was clear to me that Mr Hutchins and Mr Ray were focused on the content of the Tender Letters sent by One Sector to Hestbay for Stage 2, which spelt out the detail of the work to be performed and its cost.  I found, contrary to the evidence given by Mr Hutchins (see below), that there was probably never any discussion between them about the general terms and conditions of their agreement for Stage 2.  
  7. [295]
    Updated Tender Letters were sent to Hestbay as negotiations between the parties about the scope of work for Stage 2 work continued, and changes to the work were agreed.  Each of the Tender Letters sent to Hestbay included the statement that One Sector’s standard terms and conditions applied – but the detail of those terms and conditions were not supplied.  
  8. [296]
    Sometime before the practical completion date for Stage 1 (that is, before 17 June 2015), Mr Hutchins said that he told Mr Ray that he wanted One Sector to build Stage 2.  He said that Mr Ray told him that his “lawyer”, Amanda Lawrence, would draw up a contract “in line with the Stage 1 contract”.  
  1. [297]
    Mr Ray explained that Ms Lawrence was not his lawyer: she was his contracts administrator.  In that role, Mr Ray would ask her to prepare draft contracts for One Sector’s clients.  Mr Ray denied telling Mr Hutchins that Ms Lawrence would draw up a Stage 2 contract in line with a Stage 1 contract, although that was in fact the  contract which was sent by Mr Ray to Mr Hutchins, twice, on 10 July 2015 (see below). 
  1. [298]
    On 9 June 2015, Mr Ray sent Mr Hutchins an email which attached One Sector’s Stage 2 Tender Letter, dated 23 May 2015.  The Tender Letter stated that all specifications were based on Stage 1 construction (although Stage 2 was approximately 1000 square metres bigger).  It included, in red, the note that One Sector’s standard terms and conditions applied.[62]  
  2. [299]
    Mr Hutchins did not reply to that email/Tender Letter.[63]  
  3. [300]
    On 11 June 2015, Mr Ray emailed Mr Hutchins and advised that if One Sector was to “win” Stage 2, then it would “look after and maintain” Stage 1.  Mr Hutchins had not then decided whether One Sector would build Stage 2. 
  1. [301]
    On 22 June 2015, GMP certified that the Stage 1 works had reached practical completion on 17 June 2015.  
  2. [302]
    On 10 July 2015, at 13.29 pm[64] Mr Ray emailed Mr Hutchins the Stage 2 “contract”.  His email said, “Let me know if your (sic) happy and I will sign the copy’s (sic) here or if any amendments and Amanda can sort it.  Same as stage 1 just different docs”.[65]  
  3. [303]
    A few minutes later, at 1.38 pm, Mr Ray sent through another copy of the contract under cover of an email with the Subject line “Fuck”.  His email said (my emphasis):[66]

Amanda has sent the stage 1 tender letter in that,

Stand by for another copy with right tender letter

Hard to find good help now days

The rest of the main body remains the same.

  1. [304]
    The second emailed contract consisted of:[67] 
    1. the Australian Standards 4902 – 2000 Formal Instrument of Agreement; 
    2. the Australian Standards 4902 – 2000 General Conditions; and 
    3. Annexures to the General Conditions, marked “Part A” through to “Part G”; which included both the detail of the Stage 2 Tender Letter, as part of Annexure F; and a copy of the Tender Letter itself.[68]  
  2. [305]
    It will be recalled that the Stage 1 contract reproduced some of the Stage 1 Tender Letter in its Part F (with some changes) but did not include a copy of the Tender Letter itself.  
  3. [306]
    The specifications and the details of the work to be done set out in Annexure F differed from those in the Tender Letter for Stage 2 in several respects.  As just one example, Annexure F provided for a “22-month free maintenance inspection for end of warranty period”.  The Tender Letter provided for a 6-month inspection.  
  4. [307]
    When it came to the slab’s specifications, the following two differences mattered: 

Spec #

As per Annexure F

 

As per Tender Letter

6

Internal slabs 175mm with 32 mpa concrete with Helix Fibre Reinforcement

Engineering

 

Internal slabs 175mm with 32 mpa concrete with Reinforcement to

Engineering design

12

All concrete to be sealed using densifier product.

There was no particular 12 in the Tender Letter and no reference elsewhere in the Tender Letter to sealing the concrete with a densifier.

  1. [308]
    Helix Fibre Reinforcement is a fibre reinforcement which is added to the cement mix at the concrete plant.  Mr Ray used it in Stage 1 but decided not to use it in Stage 2.  He explained that he used traditional F 82 mesh reinforcement instead, to avoid the cracking which had appeared in Stage 1.[69] It is reasonable to infer that he amended the Tender Letter after he decided not to use the Helix Fibre.
  2. [309]
    Mr Ray gave no evidence about why a densifier was not included in the Tender Letter’s specifications for the Stage 2 slab.    
  3. [310]
    The copy of the Stage 2 Tender Letter which was included in the email sent on 10 July 2015 contained the statement that One Sector’s standard terms and conditions applied – but those terms and conditions were not sent.  
  4. [311]
    In my view, the 1.38 pm email from Mr Ray is significant.  It is reasonable to infer from it that Mr Ray – 
    1. checked the contractual documents sent to Mr Hutchins minutes earlier; 
    2. picked up on the fact that the details of the wrong tender letter had been included in Part F; 
    3. replaced the detail in Part F to reflect some of the content of the correct Tender Letter;
    4. sent the actual Tender Letter as well; 

and 

  1. had no issues with the AS 4902 conditions.
  1. [312]
    Further, and of significance, the AS 4902 contract sent by Mr Ray to Mr Hutchins recognised that there would be no Superintendent appointed for Stage 2.  Against Item 5 of Part A of the Annexure, where provision is made for the nomination of a Superintendent, Mr Ray has inserted “Not applicable”.[70]
  2. [313]
    In his first affidavit, Mr Hutchins said that he met Mr Ray at the Surf Club at Nobby’s Beach and told him that Hestbay accepted One Sector’s proposed terms for Stage 2 as per the documents emailed on 10 July 2015 and said “let’s get started”.  
  1. [314]
    Mr Hutchins later corrected his evidence about the documents in his possession at the time of his meeting with Mr Ray at the surf club.  He acknowledged that they’d met there before 10 July 2015 and that the only document he had received at the time of their meeting was the Tender Letter dated 23 May 2015.  In his second affidavit, he said:

I met Mr Ray [at the surf club] prior to receiving the contractual documents on 10 July 2015.  The discussion between Mr Ray and I regarding the contractual documents for stage 2 was to the effect that:

  1. Mr Ray confirmed that the contract documents for stage 2 (Australian Standards 4902 – 2000) would be on the same terms as those entered into for stage 1;  
  2. Hestbay would accept the tender letter dated 23 May 2015 on the basis that the Australian Standards 4902 – 2000 would be on the same terms and conditions as those agreed to for construction of stage 1;
  3. The general conditions which were to form part of the Australian Standards 4902 – 2000 would be provided at a later date (which occurred on 10 July 2015) and would bind the parties for the stage 2 construction … 
  1. [315]
    Mr Ray denied that such a conversation took place at the surf club.  
  2. [316]
    I do not accept Mr Hutchins’ evidence that a conversation such as that detailed above took place.  The terms of the AS contract were not mentioned in any of the email correspondence between the parties; nor did anything in their correspondence suggest that Mr Hutchins or Mr Ray gave any thought to the contractual context for the design and construction of Stage 2 beyond the detail of the Tender Letters; nor did their cavalier approach to their contractual negotiations for Stage 2 suggest that they gave any thought to anything other than the detail of the Tender Letters.  (I include, as examples of that cavalier approach: Mr Hutchins failing to reply to significant emails; Mr Ray’s failing to follow through on his intention to collect the contracts from Mr Hutchins (see below); and neither of them ever signing anything contractual, before, during, or after the build.) 
  3. [317]
    Mr Ray said in his oral evidence that the statement in his email of 10 July 2015, “Same as stage 1 just different docs” conveyed that the design and finishes of each stage would be the same but that the “contract documents” would be different.  I do not accept that the statement in the email conveyed that meaning.  And of course, the documents sent on that day were the same documents as those which comprised the Stage 1 contract, with the addition of the Tender Letter for Stage 2.
  4. [318]
    In reinforcing his evidence that he did not mean that the contractual documents would be the same, Mr Ray said:[71]

… Amanda had instructions to amend it [the AS 4902 – 2000 contract] to try to make it suit the standard terms and conditions which we usually work off, and I sent him that draft thinking he would get his changes over the weekend, and I would deal with it after that.

  1. [319]
    Mr Ray was asked why he did not simply send his “pro forma” One Sector contract terms and conditions to Mr Hutchins.  He said he was, “trying to keep the client and myself happy, when you have the financier, so - - -” (my emphasis).[72] I consider this another significant piece of evidence.  It implies that Mr Ray appreciated that Hestbay’s financier required the AS 4902 contract, and was not satisfied with One Sector’s contract (which in any event was not a design and construct contract).  
  2. [320]
    His cross-examination continued as follows (including some questions from me, my emphasis):[73]

I suggest to you that you had not instructed Amanda to change the terms of the AS 4902 contract to align with One Sector’s contract.  Do you agree with that or not?---No.

And I suggest to you that you were content to have stage 2 proceed on the basis of the AS 4902 contract that was attached to that email that I referred you to at page 538 of the bundle?  I sent the contract in draft on that date. 

HER HONOUR:  So, Mr Ray, can I just follow this.  So the contract that you sent on the 10th of July was the AS 4902 contract?---Yes.

And are you saying that you instructed Amanda to amend that contract?---Yes.

So if I look through this AS 4902 contract that you sent […] and compare it to the standard form, will I see the amendments?---There – there is amendments, I believe, between the first one – there – there was some – there was parts of it that I think did get amended.

But … I think you said in evidence that the contract that you sent was an amended version of the AS 4902, amended to take into account conditions that you liked and included in your standard form contract?---That – that was my intention. 

That was your intention.  Okay.  So … my follow-on question for you is, “so I should find, then, in the contract you sent to Mr Hutchins, amendments from the standard form 4902 contract?”--The amendments didn’t happen, your Honour.

They didn’t happen?---They were meant to, and they didn’t.

Right.  Okay.  All right.

MR WHITTEN:  Thank you, your Honour.

In fact, the only change that occurred was that Amanda, in that first email, had sent the stage 1 tender, and that had to be changed so that the stage 2 tender was sent.  That’s correct, isn’t it?---No.  The - - -

HER HONOUR:  If you have a look at page 539 of the exhibits?--- Yes, that – yes, that was one of the - - -

So that was the change.  And then - - -?---That was one of – one of the issues, yes.

And page 540, at 2.26 pm, you then send that draft contract revision 2, with the stage 2 tender?---Yep.

Yes.  But it’s the AS 4902 contract that’s sent, isn’t it?---Yes.  

  1. [321]
    The draft AS 4902 contract which Mr Ray sent to Mr Hutchins on 10 July 2015 was not signed by Mr Hutchins.  
  2. [322]
    The next written correspondence between the parties was on 14 July 2015, when Mr Ray sent Mr Hutchins an email, saying that he was ready to do “the above” (namely, “tree clearing/shed removal”).[74]  
  1. [323]
    Mr Ray and Mr Hutchins continued to correspond about Stage 2 as issues arose, including, for example, about the set-back required by council[75] and the height of a rock retaining wall.[76] On most occasions, when a change to the works was made, Mr Ray sent Hestbay an updated Tender Letter.  
  2. [324]
    One Sector entered into a sub-contracting agreement with Australian Rock Walls Pty Ltd on 13 August 2015.[77] The document’s header clearly implies that it is a subcontract for the purpose of Stage 2 of Hestbay’s Molendinar project, and assumes the existence of a head contract between One Sector and Hestbay.  See, for example, clause 17.4 and the definition of “Head Contract” in the subcontractor agreement,[78] although I note that the description of the head contract works was left blank in the schedule to the subcontract.[79]
  3. [325]
    In February 2016, One Sector engaged in a similar subcontract with the trustee of the “L Baguley Builder Trust” for the supply and installation of screw piles for Stage 2.[80] 
  4. [326]
    On 25 September 2015, One Sector sent “progress claim 1” for Stage 2 to Hestbay.[81]  The claim related to “Site Establishment, Tree Clearing & Retaining”.  It was accompanied by a Statutory Declaration by the Head Contractor, which included the following paragraphs which expressly assumed an existing contract:[82] 

…

  1. The Contractor [One Sector] has entered into a contract with Hestbay Pty Ltd (Principal) in relation to the project at Stage 2, 27 – 29 Industrial Avenue Molendinar Qld (Contract).  
  2. I am making this statutory declaration in connection with the payment of Progress Claim No 1.
  3. As at 25 September 2015, all monies due and payable by the Principal in relation to the Contract have been paid in full.
  4. All insurance policies required to be effected by the Contractor pursuant to the Contract are current and will remain current for the duration of the project.  

…

  1. As at the date of this declaration, the Contractor is not in breach of any of its obligations under the Contract or any other project document to which it is a party and nothing has occurred which would entitle a person to terminate or rescind the Contract or any project document.
  1. [327]
    The Continuation Sheet included in the progress claim set out the work for the whole of Stage 2.  
  2. [328]
    Subsequent progress claims were made – 15 in all.  The evidence included in the trial bundle includes statutory declarations referring to “the Contract” (in the same terms as those set out above) for some, but not all, of the progress claims.  
  3. [329]
    Between 1 October 2015 and 16 November 2015, Westera Partners prepared engineering drawings for Stage 2.
  4. [330]
    Progress claim 2 was made on 6 November 2015.
  5. [331]
    On 9 November 2015, Mr Ray emailed Mr Hutchins (Subject: “Stage 2 Amendments and Contract update”) outlining a proposed new contract price; referring to his need to “finalise the contract for Stage 2”; and explaining his conclusion that they could “run with” the existing contract, as follows:[83] 

Gday

I’ve had a meeting with Paul this morning to drill down on what’s changed to try and finalise the contract for Stage 2.

Existing Contract Price - $6,154,985.00 + GST

Existing Size – 9000 m2 Inclusive of 600 m2 of sprinkled office.

New Contract Price - $6,154,985.00 + GST

New Size – 9117 m2 Inclusive of 934 m2 of sprinkled office.

Changes to Design/Scope

Deduction of 3 x Loading Docs (sic) $105,000

Increase in Awnings size - $97,000 …

2 Extra offices in floor areas calculation

Costs to redesign to a new scope

The long of the short is the building has actually increased 117m2 and the cost of office space is more than normal floor area.  There’s no transaction to be done I think we just run with the contract that we have or I’m going to have to put the price up? 

Let me know your thoughts.

  1. [332]
    In reply, Mr Hutchins said he would let Mr Ray know his thoughts “over a beer” later that week.[84]
  2. [333]
    Mr Ray said that his reference to “the contract we have” was not a reference to the “AS” contract sent to Mr Hutchins on 10 July 2015.  He was questioned further on this point (my emphasis):[85] 

HER HONOUR: … So the question you’re being asked is whether your reference to “the contract that we have” in that email is a reference to the document Amanda sent first with the stage 1 tender and then corrected with the stage 2 tender?---I wasn’t talking about the AS contract.

MR WHITTEN:  Okay.  All right.  I suggest that you were.  Do you agree with that or not?---What was that one, sorry?

I suggest that you were talking about that AS contract?---Well, why would I have to put the price up?

But when you say:

       I think we just run with the contract that we have.

The “contract that we have”, you are referring to the AS contract?---I – I – I was working off my standard terms and conditions.  I’d been handing over the designs and construction programs.  I think I’m referring to it being the more expensive contract, so – and that’s why I would have to put the price up.

So your evidence is that where you say: 

       With the contract that we have -

correct me if I’m wrong – you’re referring to the tender that you had sent?---Yes.  My standard terms and conditions.

But you hadn’t sent the standard terms and conditions to Mr Hutchins before that time, had you?---Not – no.

HER HONOUR:  But you thought you had?---No, I didn’t think I had.  I – I – I knew he was aware of them, because we’d sent them on other things, like at the start of stage 1.

Right?---and so I didn’t send him that document again, being the standard commercial terms, apart from sending him my tender letter, which includes standard terms and conditions.

HER HONOUR:  But didn’t you tell me that – acknowledge that you sent the AS4902 document - - -?---I did send that, yes.

And the plan was – or you say your plan was that Amanda was going to amend that to reflect your standard terms and conditions?---It was – yes.  She was meant to make it reflect closer to the standard terms and conditions, somewhat maybe a hybrid between the two.

Right.  But when I asked you whether I would find that hybrid, in effect you said that didn’t happen?---She didn’t follow my instructions.  Correct. 

Okay.  All right.

MR WHITTEN:  thank you, your Honour.

HER HONOUR:  And probably, again, just so that I can understand, then, so this phrase:

       …contract that we have, or I’m going to have to put the price up-

What do you say the reference to “contract that we have” was?  Your tender document?---The tender document.

  1. [334]
    Progress claim 3 was made on 24 November 2015.
  2. [335]
    On 27 November 2015, Mr Ray emailed Mr Hutchins with a new contract price (which reflected changes to the design).  The new contract price was $5,902,185.00 + GST.  Mr Ray ended his email with, “Apologies this took to (sic) long, ill (sic) have the contract ready this arvo!”[86]
  3. [336]
    Progress claims 4 to 7 were made between 9 December 2015 and 7 March 2016. 
  4. [337]
    Meanwhile, the final layout of Stage 2 was still under discussion.  On 11 March 2016, Mr Hutchins asked Mr Ray (and his Stage 2 project manager, Mr Garland) to “send through a new contract with latest plans and final price, inc office”.[87]
  1. [338]
    On 15 March 2016, Mr Garland sent to Mr Hutchins a Tender Letter dated 14 March 2016 and relevant drawings/plans.  The Tender Letter quoted a new price for Stage 2 – $5,960,185 plus GST.  The email attaching these documents said, “With your approval we will amend the contract to suit this le er (sic) and send it over for review and signing …”[88]  The tender was revised again on 17 March 2016, with a new contract price of $6,162,185 plus GST, and sent to Mr Hutchins.
  2. [339]
    In my view, the notion of amending the contract “to suit” the new tender letter is consistent with the practice of including the detail of the tender letter in Annexure F of the AS contract.
  3. [340]
    On 23 March 2016, Mr Garland asked Mr Ray where the “two hard copies of the contract were” so that he could add revised plans and drawings to it.  Mr Ray told Mr Garland that Mr Hutchins had the contracts and that he would “grab them tomorrow” if required.[89] On that same day, Mr Ray asked Mr Hutchins if he could pick up the contracts “for an hour tomorrow” to add the plans to them and bring them back.  Mr Hutchins said he would leave the contracts “at reception”.[90] I note that whilst several revisions of the Tender Letter for Stage 2 were sent to Mr Hutchins, he was not sent any other documents to replace the AS 4902 documents sent on 10 July 2015.  There was no evidence that the contracts were collected by Mr Ray  
  4. [341]
    Progress claims 8 to 12 were made between 5 April 2016 and 21 June 2016.
  5. [342]
    On 22 June 2016, Mr Ray emailed Mr Hutchins.  The subject of the email was: “27 Industrial Avenue/Contract Reconciliation”. The email included the following (corrected by me for obvious errors):[91] 

John,

As discussed, I’m trying to bring the project to an end and want to tie up all our negotiations etc so we can finalise our lease and build contract etc.  [One Sector wished to lease an office in the industrial complex from Hestbay].  Does this information align with our agreements and where you see things?  Let me know if there’s anything I’m forgetting and we can make the necessary adjustments.

  1. [343]
    The balance of the email set out the work to be done and relevant adjustments to the contract price and invited Mr Hutchins to send any “outstanding information” to Mr Ray.
  2. [344]
    Progress claim 13 was made on 22 June 2016; and progress claim 14 was made on 12 July 2016.
  3. [345]
    On 20 July 2016, Mr Ray emailed Mr Hutchins a copy of the email previously sent on 22 June 2016, with updates in red showing how matters had progressed.[92] 
  4. [346]
    Progress claim 15 was made on 27 July 2016. 
  5. [347]
    Practical completion of Stage 2 was reached on 2 August 2016.
  6. [348]
    Mr Ray sought the release of the amount retained on 5 October 2017.  
  7. [349]
    In December 2017, the parties were settling a contract for the fitout of Unit 9.  A One Sector contract, with its terms and conditions, was used.[93]  It is this document which One Sector relies upon for the application of the “last shot” doctrine, for which it contended.  
  8. [350]
    The contract’s brief description of the works is “Design and Construction of Office Fitout to Unit 9”.  However, the scope and extent of the work was stated to be “The supply of all materials, labour, plant and equipment for the construction of … office fitout works to Unit 9. (I am drawing a distinction between “designing and constructing” and only “constructing” by way of supplying materials, labour et cetera.)

The concrete used in Stage 2

  1. [351]
    In late 2015, One Sector entered into a contract with Excel Concrete Pty Ltd for the supply of concrete for Stage 2.  One Sector ordered a cement mix of “32.20.100” which was shorthand for a mix which included – 
    1. N32 concrete; 
    2. contained 20 mm sized rock or aggregate; and
    3. had a slump of 100 mm.
  2. [352]
    Excel’s conditions of sale included the following about the addition of water on site:

Water addition on site

Excel Concrete Pty Ltd personnel may add water to concrete for the purpose of adjusting slump and are the responsibility of Excel Concrete Pty Ltd.  Water requested to be added to the load by the customer or their on-site representative will be recorded in the delivery docket and the performance of the concrete is no longer warranted.  

  1. [353]
    Mr Ray acknowledged that the Westera engineering plans called for concrete that was 32.20.80, but he ordered concrete with a higher slump, as he had done for Stage 1.  It was more expensive per cubic metre than the 80 mm-slump concrete, but he considered it more workable and more likely to flow through the concrete pump cranes. 
  2. [354]
    Between 18 April 2016 and 18 May 2016, 200-plus[94] truckloads of cement mix were delivered by Excel for the internal slabs of Stage 2.  
  3. [355]
    Each truckload was accompanied by a delivery docket.  An example follows: 

Hestbay Pty Ltd v One Sector Pty Ltd [2024] QSC 180

  1. [356]
    For my purposes, the critical parts of the docket are the notation (if any) after the phrase “Slump stand water added”; the notation (if any) after the phrase “Water added at customer’s request”; and the notation (if any) after the phrase “Max water” and before “LTRS PER LOAD”.  The dockets also bore the following warning, “Caution The addition of water is detrimental to the concrete strength and durability.  Water added is the customers responsibility”.
  2. [357]
    The dockets were not filled out in a careful way.  Some of the notations on some of them were difficult to read or had been scribbled anywhere (rather than in the spot designed for the insertion of a value).
  3. [358]
    No evidence was led from Excel about: (a) the delivery dockets generally; (b) what “slump stand water added” meant; or (c) the company’s practice when it came to filling out the dockets.  Nor was any evidence led from any person who in fact made an entry on any delivery docket associated with the concrete delivered for the Stage 2 slab.  Nor was any evidence led from any person who was in fact involved, in a labouring sense, in the Stage 2 slab pour, or any part of it.  Mr Ray observed the pour and took photographs of it, but that was the extent of the evidence he provided about it.
  4. [359]
    In oral evidence, Mr Ray said that he was not entirely clear on what the statement “max water – litres per load” meant.[95] However, in his affidavit evidence he sounded confident about the way in which the dockets were to be interpreted: 

If there is a ‘slump stand water added’ value on the delivery docket, this refers to the amount of water added by the third party [here, Excel] at the concrete plant.

The defendant has no involvement in whether additional water is added by the third party at the concrete plant and recorded as ‘slump stand water added’.  That is a matter for the concrete supplier.

If there is a ‘water added at customer’s request’ value on the delivery docket, this refers to the amount of water added to the load by the driver after discussion with the defendant.

If there is a ‘max water per load’ value on the delivery docket, this refers to the amount of water that the concrete supplier has advised may be added to the mixture on site, after the delivery truck arrives at the site.  The defendant’s practice was not to add more water than what was stated as the ‘max water per load’ on the delivery docket.

The max water per load is decided by the third party, not by the defendant.

  1. [360]
    On Mr Ray’s count, there were 54 delivery dockets in which a figure was inserted in relation to the phrase ‘water added at customers request’.[96]  He said that if there was no stated maximum on the docket, the defendant added whatever volume of water it considered necessary for the purposes of: (a) workability; (b) to “stop cold joints”; and (c) to get the concrete through the pump.[97] Cold joints may develop when softer concrete is poured next to a harder concrete (from an earlier load).  In Mr Ray’s experience, cold joints were to be avoided because they are almost certainly associated with cracking.  
  2. [361]
    Mr Ray was asked “as an experienced concreter” whether he knew that adding “too much water” to cement could reduce the strength of the concrete. He said it was standard industry practice to add it, and that in many cases one had to.  He knew it reduced strength, but he also knew that concrete was supplied “with a tolerance” which allowed for the addition of water.  However, he did not find out from Excel what the Stage 2 cement tolerance was.  He agreed that the only way to tell the strength of the concrete (on site, after pour) was by testing it in accordance with AS 1012, which was not done.  
  3. [362]
    It was accepted by the plaintiff’s expert, Dr Woolcock, that the concrete delivered by Excel was likely to have in fact been stronger than 32 MPa because it was necessary for concrete suppliers to target strengths higher than the specified strength to ensure that the specified strength was achieved, but there was no evidence from Excel about it.
  4. [363]
    Mr Ray thought the concrete supplier was required to test the concrete every 50 cubic metres, according to AS 1379, but that there was no requirement for extra testing after the concrete left the supplier.  However, he accepted that project (that is, on site) assessment had been specified by the engineers for the warehouse slabs and that they ought to have been tested in accordance with the Australian Standard.  He said that he misinterpreted the Australian Standard and did not test as required by it – although  “Cardno” did a few tests on the first day of pouring (18 April 2016).[98]  (More accurately, they conducted tests on samples taken on day one at 7 days and 28 days.)  He agreed that, because One Sector did not test onsite, there was no way of knowing whether the water added on site affected the concrete’s strength, although I note that Dr Khan referred to the more general signs of concrete being affected by excess water, which, in his opinion, were not present in this case.
  1. [364]
    Mr Ray denied that the defendant added water to the Stage 2 concrete mixture on site in an uncontrolled manner as asserted by Hestbay because: (a) Excel, not the defendant, added water as per the “slump stand water added’ notations on the dockets [although this was irrelevant]; (b) water was added on site to avoid cold joints and cracking; and (c) the defendant’s practice was not to add more water than that stated as the ‘max water per load’ on the delivery dockets.  

Flawed comparison between the Stage 1 and Stage 2 slabs

  1. [365]
    To prove its case, Hestbay relied upon comparisons made by its engineering expert, Dr Woolcock, between the condition of the Stage 1 slab and the condition of the Stage 2 slab.  
  2. [366]
    Dr Woolcock based his comparison of the Stage 1 and Stage 2 slabs on an assumption that the Stage 1 slab had been built to its specifications, which were almost the same as the specifications for the Stage 2 slab, and which included that it was to be of 32 MPa; and that the only variable that differed between them was that uncontrolled water was added to the Stage 2 slab during its pour.
  3. [367]
    Relying on Dr Woolcock’s opinion, the plaintiff argued that it could not have been the hard-wheeled vehicles which damaged the Stage 2 slab because the Stage 1 slab was subject to similar use and it was not damaged.  Therefore, it had to have been the uncontrolled addition of water which was added to the Stage 2 slab at pour which caused, or which was an effective cause of, the slab’s damage.  
  4. [368]
    In my view, for Dr Woolcock’s opinion to carry any weight, the factual assumptions upon which it was based had to be proven by admissible evidence.  They were not.  There was almost no evidence before me about how the Stage 1 slab had been constructed: that is, whether it had in fact been built to its specifications (and no better than its specifications) and in accordance with the engineers’ design requirements.  Nor was there evidence before me about its strength at relevant times.  
  5. [369]
    To further elaborate, I did not know inter alia – 
    1. the targeted strength grade of the concrete actually supplied by Excel for the Stage 1 slab; and whether it differed from the targeted strength grade of the concrete actually supplied for the Stage 2 slab (although there was no evidence of that before me either);
    2. whether “uncontrolled” water was added to the Stage 1 slab during its pour; or, if water had been added, in what volume and under what circumstances; 
    3. whether there were any other relevant differences between the way in which the Stage 1 slab was poured and the way in which the Stage 2 slab was poured such as (for example) –
      1. the frequency of cement mix deliveries,
      2. the average volume of the cement deliveries,
      3. the length of time over which the slabs were poured, (iv) the temperature or weather conditions during the pours;

and, whether any difference (if there was one) would have had any impact on the way in which the slabs performed;

  1. the Stage 1 slab’s slump;
  2. the Stage 1 slab’s water to cement ratio, before and after its pour;
  3. the strength of the Stage 1 slab at 28 days after its pour; 
  4. the strength of the Stage 1 slab in 2022; 
  5. whether a densifier had been applied to the Stage 1 slab; or
  6. the surface hardness/abrasion resistance of the Stage 1 slab.
  1. [370]
    A comparison between the way in which the Stage 2 slab had been constructed and the specifications of the Stage 1 slab told me nothing about the reason why the Stage 1 slab performed better than the Stage 2 slab under similar conditions of use.  To be worth anything, the comparison had to be between the way in which the Stage 2 slab had been constructed and the way in which the Stage 1 slab had been constructed.  I could not logically compare the performance of the Stage 1 slab with the performance of the Stage 2 slab and conclude that the Stage 1 slab performed better because uncontrolled water was not added to it unless everything else was in fact “equal”; or, if there were differences, that the differences did not affect performance.  I could not just assume that the Stage 1 slab had been constructed to specifications.  Nor was it the law that I could infer that the assumptions were true because the defendant did not seek to prove otherwise (as the plaintiff argued).  
  2. [371]
    The short point is that there was no evidential foundation for Dr Woolcock’s opinions which relied upon the comparison between Stage 1 and Stage 2.  Thus, any opinion which depended upon the assumption that the only variable which differed between the slabs was the amount of water added to the Stage 2 slab during its pour was of no weight.  It would have been open to the defendant to object to the admission of Dr Woolcock’s evidence on the basis that the factual foundation upon which it was based was not proven – but the defendant did not do so.
  3. [372]
    There were two other complications with the comparison.  The first concerned the way in which each slab had been reinforced.  The second concerned the unsatisfactory state of the evidence about the application of a densifier to the slabs.  
  4. [373]
    As to the reinforcement: All that was revealed in evidence about the construction of the Stage 1 slab (as distinct from its specifications) was that it had been reinforced differently from the Stage 2 slab.  There was no Helix Fibre Reinforcement in Stage 2.  That difference was important.  The plaintiff’s own expert said that it might have been the Helix Fibre Reinforcement which explained the better performance of the Stage 1 slab, even on his assumption that uncontrolled water was added to the Stage 2 slab during its pour, but not to the slab in Stage 1. 
  1. [374]
    As to the application of a densifier: On the evidence, a densifier could increase a slab’s strength by up to 25 per cent.  A densifier was specified for the Stage 1 slab.  It was not specified in the Tender Letter for the Stage 2 slab, although it appeared as a specification for the Stage 2 slab in an annexure to the AS 4902 contract.    
  2. [375]
    There was no evidence about whether it was in fact applied to the Stage 1 slab.  If the Stage 1 slab had been built to its specifications, then it would have been.  
  3. [376]
    I found that a densifier was probably not applied to the Stage 2 slab because –
    1. it was not specified in the Tender Letter (which in a practical sense took precedence over the terms of the AS 4902 contract); and
    2. the application of a densifier was Mr Ray’s preferred option for dealing with Budget Pet Products’ complaints about the slab – which implied that it had not already been applied.[99]  
  1. [377]
    If the densifier was only applied to Stage 1, that too could have explained its better performance.  But I acknowledge that this was a matter of speculation. 

Expert engineering evidence 

  1. [378]
    Four engineers gave evidence.  One for the plaintiff and three for the defendant.  They each provided more than one report and participated in a joint report. 
  2. [379]
    Each expert also gave oral evidence.
  3. [380]
    Ultimately the contentious issues between the experts at the end of the trial included: (a) the method of calculation of the strength of the concrete 28 days after its pour in 2016 when its strength was not actually tested until 2022; (b) the relevance of moisture in the environment in which the concrete hardened; (c) whether the slab was of its required thickness and, (d) if I were to find that the defendant had constructed a deficient Stage 2 slab, whether I ought to order its repair or its removal and replacement.
  1. [381]
    The review of the experts’ opinions which follows shows uncertainty about the way I was to assess whether the slab was of “32 MPa”.  Was 32 MPa a reference to its average compressive strength, or its characteristic compressive strength, or something else;[100] and at what point in time – given that concrete hardens over time?  
  2. [382]
    Contrary to the defendant’s submissions, it was Dr Khan, the defendant’s expert who first assessed whether the slab was 32 MPa in 2022 in terms of its “characteristic compressive strength”.  Dr Woolcock was content, at first, to answer the question about the strength of the slab in 2022 on the basis of the slab’s average corrected compressive strength.  Although Dr Woolcock discussed characteristic compressive strength in his report – he did so only in the context of discussing the mix design (at [84]). 
  3. [383]
    My analysis of the expert evidence follows.

Plaintiff’s expert: Dr Scott Woolcock 

Report 28 August 2022[101]

  1. [384]
    Dr Woolcock is a civil and structural engineer, with 52 years of experience in the design and management of civil and structural engineering projects.  He was the plaintiff’s only engineering expert but I was careful not to simply conclude that the defendant’s expert case was better because it called three engineers.  
  2. [385]
    Inconsistently with the plaintiff’s case, Dr Woolcock was of the opinion that the design of the slab was suitable for general industrial use in the absence of a detailed brief (from the owner) which specified the intended use of solid tyre forklifts and floor finishes.[102]
  3. [386]
    At [57] he explained that, in the absence of a detailed owner’s brief, a builder or design engineer may provide “a reverse brief”.  He noted that, in this case, One Sector provided a scope of works in its Tender Letter dated 23 May 2015 nominating 175 mm internal slabs with 32 MPa concrete and certain reinforcing.  He noted that the engineers presented their pavement loading criteria in the notes to their drawings [59] and clearly stated that the slabs had been designed for pneumatic tyred vehicles only.  I inferred that, in his opinion, these documents served as a reverse brief. 
  4. [387]
    Further, in Dr Woolcock’s view, the engineers’ assumptions about wheel loads and pneumatic tyred vehicles were reasonable in the absence of a detailed owner’s brief.  However, he suggested that the proposed above average height of the buildings ought to have prompted an experienced engineer to ask for more information about the types of forklifts to be used and their wheels [62].
  5. [388]
    The standards and other authoritative documents discussed above provided formulas or methods for inter alia the calculation of the Stage 2 slab’s strength in 2022 on the basis of the core samples taken from it in 2022.  Dr Woolcock considered it permissible to then “work backwards” from his calculation of the strength of the concrete in 2022 to calculate its strength at 28 days after its pour.  Dr Khan considered it “wrong” to do so. 
  6. [389]
    Dr Woolcock referred to AS 3600 throughout his report but he did not refer to its Appendix B at all in the context of his opinion about the strength of the slab (see paragraphs [79] – [85]).
  7. [390]
    He was content to express his opinion about the strength of the slab in terms of its mean, corrected, core compressive strength.  If he was relying on AS 3600 to do so, he failed to apply the relevant formula from B6.4.2 to calculate the “strength of the concrete in the member” because he failed to multiply the average corrected core compressive strengths by 1.15 as it required.  (I asked Dr Woolcock what else was in a member – apart from concrete.  He said “reinforcement”.)[103]
  8. [391]
    The defendant’s expert on concrete strength was Dr Khan.  In his first report, he pointed out Dr Woolcock’s error.  Dr Khan applied AS 3600 B6.4.2 (correctly) and Z11 and BS EN 13791 to answer the question about the strength of the slab in 2022 in terms of its characteristic compressive strength.
  9. [392]
    As will emerge, ultimately Dr Woolcock and Dr Khan agreed that the Stage 2 slab was 32/33 MPa in 2022 upon their application of the statistical analysis recommended by Z11, which gave a result for characteristic compressive strength.  They did not apply AS 3600 B6.4.2 for the reasons discussed in Z11 (set out above).  
  10. [393]
    In summary, in August 2022, Dr Woolcock’s opinion was – 
    1. as to strength: that the Stage 2 slab did not meet its specifications.  Concrete increased in strength over time.  It was conservative to assume a 10 per cent increase in the six years since the slab was poured.  The Stage 2 slab could not have been of 32 MPa average strength at 28 days after its pour because its average strength was not more than 35 MPa six years after its pour.  

(The defendant’s position was that it was not permissible to assume a 10 per cent increase in strength and then, on that assumption, work backwards from the slab’s strength in 2022 to estimate its strength 28 days after its pour, because the rate of strength gain was dependent on too many variables.)   

  1. as to thickness: on a “spot failures” approach, the slab did not meet its specifications.  Slab thickness was tested at 68 sites.[104]  The average thickness of the slab at those sites was over 181mm.  However, 17 samples were less than 170 mm (175 mm less the 5 mm permitted tolerance) – that is, about 25 per cent of the samples taken.  

(The defendant submitted that thickness ought to be assessed in terms of average thickness – not on a spot failures approach.  It also made the point that, for his conclusions about thickness, Dr Woolcock relied upon length measurements by Griffith University and Premier Concrete Testing, which were not in evidence.)  

  1. [394]
    Before I go on to discuss Dr Woolcock’s first report further, it is important to understand that Dr Woolcock was asked to make several assumptions about the construction and performance of the Stage 1 slab in providing his expert opinion.  Those assumptions were set out in an email from the plaintiff’s lawyers to Dr Woolcock dated 25 August 2022 as follows (errors as per original):[105]  

… we request that in preparing your report you make the following assumptions:

  1. The concrete internal slab design in the stage 1 warehouse included a concrete compressive strength of 32 MPa with  Helix Fibre Reinforcement Engineering, with 175 mm slab thickness.
  1. The concrete slab external driveways/hardstand design in the stage 1 warehouses included a concrete compressive strength of 32 MPa reinforced with F82 mesh and a slab thickness of 175 mm.
  2. The tenants of the stage 1 warehouses used the warehouses in a similar manner to how the tenants of the stage 2 warehouses have been using them.
  3. The tenants of the stage 1 warehouses have been using forklifts with non-pneumatic tyres and one tenant (Viadux) also uses one counterbalance forklift with solid rubber tyres.
  4. The tenant of the stage 1 warehouses are not experiencing the dusting, flaking, cracking, abrasions or any other defects in the internal concrete slabs that the tenants of the stage 2 warehouses have experienced.

…

  1. [395]
    It is, of course, perfectly proper for an expert to be asked to assume certain facts as the basis for their opinion.  But unless the assumed facts are proved in evidence, the expert’s opinion which depends on those facts is of very little, if any, value.
  2. [396]
    Despite the way in which the assumptions in 1 and 2 were drafted, that is, in terms of the slab’s design, Dr Woolcock assumed that Stage 1 had been constructed in accordance with its design – that is, with a slab of 32 MPa, Helix Fibre Reinforcing, and a thickness of 175 mm.  There was evidence that Helix Fibre Reinforcing had been used in the Stage 1 slab.  But, relevant to paragraphs 1 and 2 above, nothing else was proved about the construction of the Stage 1 slab.
  3. [397]
    The assumptions in paragraphs 3, 4 and 5 were “proved” in a vague, matter-ofimpression way.  However, to the plaintiff’s benefit, I was prepared to proceed on the basis that the evidence before me was sufficient to prove the assumptions contained in those paragraphs.
  4. [398]
    Returning to Dr Woolcock’s evidence, in his opinion, the following factors could have contributed to, the breakdown of the slab in Stage 2 – 
    1. the uncontrolled addition of water;
    2. ordering concrete with a 100 – rather than an 80 – mm slump;
    3. failing to carry out concrete strength and slump testing;
    4. the specification of an unnecessarily high water-cement ratio – although in cross-examination, he agreed that no particular water-cement ratio was specified by the engineers, rather a maximum ratio was prescribed;
    5. the absence of a suitable brief from the plaintiff describing the intended use of the buildings and the finishes required; and
    6. the use of solid tyred forklifts on N32 concrete.  
  5. [399]
    Dr Woolcock’s reference to the uncontrolled addition of water was a reference to the water added to the Stage 2 slab on-site, during its pour, by One Sector, in excess of the maximum water per load specified by Excel for each of the concrete deliveries[106] and contrary to the instructions of the engineers at note CS2 (above).  
  6. [400]
    Exhibit 6 contains a revised table prepared by Dr Woolcock,[107] which sets out the relevant notations on the delivery dockets.[108]  
  7. [401]
    Dr Woolcock worked off 204 delivery dockets.  On his count, water was added at One Sector’s request to 52 of the deliveries – that is 25.5 % of the deliveries, or about a quarter.  On two occasions, water was added when a maximum amount of water per load had been specified but on neither of those occasions had that maximum been exceeded.  On every other occasion on which water was added by One Sector, Excel left blank the “Max litres per load” part of the docket and the matter proceeded on the basis that that meant that no additional water ought to have been added to that load.
  8. [402]
    Dr Woolcock explained that the addition of water to a water/cement mix was permissible under AS 1379 provided certain conditions were satisfied.  He continued, referring to AS 1379 ([87 – 89]): 

… As a maximum slump has been specified, adding water is practically limited … As the specified maximum slump is 80 mm, the tolerance is 15 mm and the maximum slump should have been 95 mm.  While adding water is not prohibited, it should be carefully controlled

…

Adding water makes the concrete easier to place and finish but it also makes the concrete weaker.  [He then referred to his analysis of the cement delivery dockets.] … it can be concluded that the total quantity of added water ranges from 0 litres to 230 litres.

As a general rule, the plant supplying the mix will have added the correct amount of water and so water should not be added on site without the approval of the site supervisor … Westera Partners included a note … that no water must be added to the concrete mix after it leaves the batching plant unless ordered by the supplier.  

  1. [403]
    According to my count of the dockets there were at least 208 deliveries of cement to the site. I say “at least” because I was not confident that all of the dockets were included in evidence[109] but for obvious reasons I did not conduct a detailed analysis of the 200 plus delivery dockets to identify how many were missing.
  1. [404]
    Also, Dr Woolcock’s reference to 230 litres as the maximum volume of water added to a Stage 2 load must be read carefully.  It is a reference to the water added to the 5.50 am load of 29 April 2016.  To that load, 150 litres of slump stand water was added (by Excel) and 80 litres was added at One Sector’s request.  The water added to each load by One Sector ranged from zero to 135 litres.  
  2. [405]
    In support of his opinion that the uncontrolled addition of water reduced the strength of the Stage 2 slab, Dr Woolcock referred to a document prepared by “Holcim”[110] entitled Excess Water in Concrete[111] which he said indicated that “each 10 litres of water added per cubic metre will reduce the strength of the concrete by 2.5 MPa” [92].  On my calculations, 10 litres is one per cent of a cubic metre. 
  3. [406]
    With respect to Dr Woolcock, the statement in the Holcim document is a little more nuanced.  The Holcim document states:[112] 

“Wetness” of concrete as measured by the slump test is directly related to its compressive strength – the 28 days compressive strength of concrete is reduced by about 1.5 MPa for each additional 20 mm of slump produced by adding water. 

To put this another way, each additional 10 litres of water per cubic metre will reduce the strength of the concrete by about 2.5 MPa”.

  1. [407]
    My lay interpretation of the above is that it is the increase in slump which is associated with the decrease in strength at 28 days – rather than simply the addition of water.  But I acknowledge that I might be wrong about that.  Unfortunately, the Holcim “formula” was not explored in evidence in any detailed way, although one of the defendant’s experts, Mr Reid, referred to it as a general comment only.
  1. [408]
    Regardless, Dr Woolcock did not, in his table, compare the amount of water added at the customer’s request to the volume of cement mix delivered for the affected loads so that I might gain a sense of the extent to which the added water “diluted” the mix.  
  2. [409]
    Nor did he identify in his table the deliveries to which 10 litres of water (or more) per cubic metre was added.  In his report, he referred to one such delivery, on 26 April 2016, to which 120 litres of water was added at One Sector’s request to a load of 7.01 m3.  
  3. [410]
    Nor did he explain how excess water added to one of the 200-plus loads delivered for the slab might impact (if at all) upon any other delivered load (whether delivered the same day or not).  
  4. [411]
    Nor did he explain how excess water added to about one-quarter of the 200-plus loads affected the strength of the slab as a whole.  
  5. [412]
    Nor did he attempt a calculation of how much weaker than 32 MPa the whole of the slab would have been, 28 days after its pour, given the uncontrolled addition of water to some of the loads, based on the Holcim statistic. Nor did he discuss what its strength might be beyond 28 days – at either 90 days or at practical completion.
  1. [413]
    I performed some of my own calculations.  So did Mr Reid (one of the defendant’s experts) in his reply report – although he was relying on the first version of Dr Woolcock’s document.[113]  
  2. [414]
    I found that, where 50 litres or more water was added to the cement mix at pour at One Sector’s request,[114] the additional water was, on average, about 1 per cent of the total volume of the cement mix of that particular load (including the slump stand water added) and never more than about 1.82 per cent of that particular load.  
  1. [415]
    I note that the Holcim document stated that adding 100 litres of water to a truck load of five cubic metres of mixed concrete would: (a) increase the slump by about 80 mm over that specified; (b) reduce the compressive strength by about 5 MPa; and (c) lead to uneven strength throughout the concrete mass comprising a number of truck loads with varying slumps.[115] The notion of uneven strength referred to in (c) was consistent with Mr Reid’s opinion that it was better to consider the effect of the addition of water on a load-by-load basis, rather than averaging the litres added across the whole slab to determine its impact.  But my point is that Dr Woolcock’s evidence did not assist me to understand the impact of the water added to some of the cement mix loads on the strength of the Stage 2 slab as a whole.  
  2. [416]
    With respect to his opinion about the uncontrolled addition of water and his study of the delivery dockets, Dr Woolcock agreed that he did not investigate where the cement deliveries, to which water was added on site, were deposited on the 8000 square metre Stage 2 slab.  He agreed that such an investigation would have been “worthwhile” to make good his theory that the addition of water lessened the strength of the concrete.  
  3. [417]
    At [67], Dr Woolcock referred to the Guide to Industrial Floors and Pavements published by the Cement Concrete and Aggregates Australia (the “CCAA”).  He said it explained that certain tests conducted in New Zealand showed that “the abrasion depth for a water-cement ratio of 0.44 was approximately half that for concrete with a water-cement ratio of 0.65, as shown in Figure 12” in support of his position that the water-cement ratio nominated (as a maximum) by Westera Partners ought to have been lower.  
  4. [418]
    I note that the extract contained in Figure 12 included the following context (my emphasis): 

Abrasion resistance of industrial pavements is not solely dependent on the compressive strength of concrete.

AS 3600 requires a minimum strength grade for specific traffic conditions and exposure classifications but the commentary to AS 3600 states that consideration should also be given to the methods of construction, such as the finishing process.  Curing and the type of surface treatment also have a major effect on abrasion resistance.  The relative effect of each of these is illustrated in Figures H1 to H5.  This data is based on work carried out by the University of Aston and the Cement and Concrete Association of New Zealand.

  1. [419]
    Only Figure H1 appeared in Dr Woolcock’s extract.  Figure H1 is a graph showing “Water-cement ratio’s effect on abrasion resistance – power trowel finishing and polyethylene sheet curing”.  
  2. [420]
    Dr Khan took issue with Dr Woolcock’s use of the New Zealand data – as discussed below.
  3. [421]
    Dr Woolcock also quoted from a data sheet published by the CCAA entitled DUSTING Concrete Surfaces, which included the addition of water in excess of that required by the mix design as a major cause of dusting ([93]).  The data sheet says that the addition of water, in excess of that required by the mix design, “generally increases bleeding which results in more water and fines at the surface of the slab and ultimately in a weak, permeable surface layer with lower wear resistance”.  In his cross-examination, Dr Woolcock explained that dusting was not something which would happen to the slab if it were not traversed by vehicles.[116]
  4. [422]
    Dr Woolcock identified the uncontrolled addition of water as the “predominant cause” of the deficient slab.  In his opinion, the uncontrolled addition of water on site not only weakened the concrete but also caused bleeding of the excess water, which brought fines to the surface.  He said at [03] (my emphasis – and note the “If”):

The predominant cause in my opinion is the uncontrolled addition of water.  If the Stage 1 concrete was constructed to the same specification (which appears likely although it is not certain that the same type and quantity of reinforcement was used) and given that solid tyred forklifts operate in Stage 1 units, then the main, and possibly sole, contributor is the uncontrolled addition of water.

  1. [423]
    Repeating myself because the point is an important one: Although it was fair to assume that the Stage 1 slab was to be constructed in accordance with the engineers’ specifications, the only evidence relevant to the way in which it was actually constructed was Mr Ray’s evidence that he did not order 80 mm slump concrete, and that Helix Fibre Reinforcement was used in the Stage 1 slab but not in the Stage 2 slab.  There was no evidence about whether water had been added to the Stage 1 slab during its pour, or how much; or the strength grade targeted by Excel (which may have been higher than N32); or the Stage 1 slab’s strength at 28 days after its pour, or in 2022; or whether a densifier had been applied et cetera.   
  2. [424]
    Dr Woolcock further qualified his opinion about the non-contribution of the Stage 2 tenants’ hard wheeled vehicles to the slab’s deterioration, referring to the reinforcement.  He said at [140] (my emphasis – and note again the “If” and “If so”):

In summary, if the slabs in Stage 1 were built to the same concrete specification and have performed well with use by solid tyre forklifts as I have been advised, then the use of solid tyred forklifts in Stage 2 would appear not to be a contributor to the surface breakdown in Stage 2.  However, it is unclear whether different reinforcement was used in Stage 1 as there are contradictory statements in the contract documents for Stage 2 and these ambiguities might not apply to Stage 1.  In some places in the Stage 2 contract documents, the reinforcement nominated to be “Helix Fibre Reinforcement Engineering” and in other places, “Reinforcement to Engineering Design”.  It is possible that steel or other fibre reinforcement was used in Stage 1 in lieu of the conventional wire SL92 mesh reinforcement used in Stage 2.  If so, this could possibly improve the abrasion resistance of the slabs but more investigation would be needed to confirm this.

  1. [425]
    Dr Woolcock reiterated his uncertainty around the reinforcing at [141].  He said, in effect, that it gave rise to the doubt he had about whether it was understrength concrete, rather than hard wheeled vehicles, which caused the Stage 2 slab to break down.  
  2. [426]
    In short: the assumptions upon which Dr Woolcock’s opinion was based were not proven and, further, in his opinion the reinforcing used in the Stage 1 slab may in fact be the explanation for the better performing Stage 1 slab.
  3. [427]
    As already noted, One Sector failed to carry out concrete testing for strength in 2016 as required by AS 1379.  Nor was the slump measured in accordance with AS 1379.  And although there was some testing by Cardno, there should have been at least one sample taken (and later tested) every 50 cubic metres – that is, there should have been 29 samples tested at 28 days.  
  4. [428]
    Generally, concrete increases in strength over time.  On that basis, at least in theory (and putting to one side Dr Khan’s objection to this approach) one could determine the slab’s strength at 28 days after its pour by way of extrapolation back from the results of strength testing undertaken in 2022 if one knew the rate of strength gain.
  5. [429]
    In concluding that the Stage 2 slab failed to comply with its specifications 28 days after its pour, Dr Woolcock began with the strength testing conducted by “CMT”[117] in 2022 which revealed the following:[118] 

Unit 9: The corrected core strengths ranged from 25.5 MPa to 37.0 MPs – an average strength of 32.2 MPa. 

Units 10 and 11: The corrected core strengths ranged from 29.0 MPa to 35.0 MPa – an average strength of 31.7 MPa.[119]

Units 12 and 13: The corrected core strengths ranged from 28.5 MPa to 38 MPa – an average strength of 32.5 MPa.

  1. [430]
    Dr Woolcock then compared the slab’s strength in 2022 with the strength he opined it should have been in 2022, if it was 32 MPa at 28 days after its pour, assuming an increase in strength over time of 10 per cent. 
  2. [431]
    As I’ve mentioned, Dr Woolcock was in error in relying on the “raw” average corrected core strength to estimate the “strength” of the slab.  He should have multiplied the average corrected core strength by 1.15 to determine “the strength of the concrete in the member” in 2022.  Dr Woolcock acknowledged his error in his later report but maintained that the slab was non-compliant.  I will ignore his error for the moment.
  3. [432]
    Dr Woolcock said that there was no definitive way to work backwards from the CMT results to determine the compressive strength of the slab at 28 days after its pour.  However, Dr Woolcock assumed an increase of ten per cent from pour to 2022, which he considered to be conservative, for the following reasons [83]: 

There is little research on how the strength of concrete increases over the long term but the Cement Concrete and Aggregates Australia Guide to Industrial Floors and Pavements 2009 publication[120] indicates a 10% increase over the 28-day strength at 90 days.  I have reviewed research papers which indicate significantly higher strength gains over the years but there are many variables and so it is safe but very conservative to assume a minimum strength gain of 10% over 6 years.  

  1. [433]
    It is important to place this statistic (the conservative assumption of a 10 per cent gain in strength over time) in context.  
  2. [434]
    The CCAA’s Guide to Industrial Floors and Pavements covers “the design, construction and specification of concrete industrial floors and pavements”.  Its content is “sequenced” to “encourage a designer to consider serviceability requirements before base thickness is established”.  It states, “It is the CCAA’s experience that the common distress modes of industrial pavements are related to joints, joint layout and the selection of appropriate concrete properties that avoid surface deterioration”.  
  3. [435]
    Honouring the sequence, the guide is divided into Chapters. Chapter 2 is entitled “Design for Serviceability” and Chapter 3 is entitled “Design for Strength”.  
  4. [436]
    Characteristic compressive strength is dealt with in Chapter 2, not Chapter 3.  Chapter 3 deals with thickness.
  5. [437]
    Section 2.4 of Chapter 2, “Designing Concrete for Durability” begins: 

2.4.1 General

The major durability consideration for an industrial pavement is abrasion resistance.  However, depending on the location of the pavement, corrosion of reinforcement, freeze thaw, and chemical attack may also need to be considered.  All of these tend to be controlled by specifying concrete of an appropriate characteristic strength, f’c.  If the f’c required for durability is higher than that required for structural purposes, it will govern the design.  

…

2.4.2 Abrasion resistance

Abrasion (wear) resistance is achieved by controlling a whole series of factors.  It is not sufficient to specify just an appropriate concrete strength.  This must be complimented by proper construction practices, e.g. compaction, finishing and curing…

…

AS 3600 sets out the requirement for the minimum f’c depending on the member and type of traffic … It must be emphasised that these are minimum strengths and serve as a guide only.  

  1. [438]
    Chapter 3 stated that the objective of thickness design was – 

…to ensure satisfactory performance of the pavement under all the applied loads, by preventing the occurrence of:

  • excessive flexural stresses, resulting in cracking of the concrete;
  • excessive bearing stresses on the concrete surface;
  • excessive punching shear stresses due to concentrated loads;
  • differential deflections at joints; and
  • excessive deflections due to settlement of the subgrade.  

The controlling design consideration varies according to the load types/contact areas … For most pavements, the governing design consideration will be the flexural tensile stress induced in the concrete by wheel or post loads … 

  1. [439]
    At page 26 of the guide, under the heading 3.3.6 “Assessment of design tensile strength of concrete”, a formula is provided for the calculation of the design tensile strength of concrete.  (This was the formula applied by Dr Woolcock and Mr Reid to determine the required thickness of the Stage 2 slab to bear its specified loads.)  It was designated as “Equation 1.
  2. [440]
    One of its variables was the “characteristic flexural tensile strength of concrete (MPa)” which is to be calculated in accordance with Equation 2.  
  3. [441]
    The specified characteristic compressive strength of the concrete was a variable for Equation 2.  The guide said, after discussing the reason why the co-efficient of 0.7√f’c is used for Equation 2 (my emphasis):

… When specifying the characteristic compressive strength of the concrete, f’c, the characteristic flexural tensile strength of the concrete [f’cf] may therefore be calculated as follows:

f’cf = 0.7√ f’c (MPa)

For pavement design, 90-day values of f’cf [characteristic flexural tensile strength of concrete MPa] are often used as being representative of the long-term concrete strength in service.  In the absence of a relationship being established for a particular mix, a 10% increase in flexural strength between 28 and 90 days is frequently assumed.  If, however, substantial heavy loading of the pavement is expected early in its life, the 28-day or lower strength value as appropriate should be used.     

  1. [442]
    Dr Woolcock agreed that “flexural strength” was concerned with the loading on the slab, taking account of movement and weight.[121] The applicability of the assumed rate of increase in flexural strength to compressive strength was not explored or challenged in evidence. 
  2. [443]
    I note the point made by the defendant that rather than “indicate” an increase the CCAA document stated that a 10 per cent increase over time is “frequently assumed”.  
  3. [444]
    I note the point accepted by Dr Woolcock that the 10 per cent assumption was a prospective one, for the purposes of design.[122]  
  4. [445]
    On the assumption of a 10 per cent increase in strength over six years and relying upon the “raw” results of the CMT testing, Dr Woolcock reasoned that, if the slab was 32 MPa at 28 days after its pour, then its strength in 2022 should have been at least 35 MPa (that is 1.1 x 32).  However, this conclusion did not account for:
    1. the statistical variability of concrete strengths; nor
    2. the fact that the concrete strength targeted by the supplier should have been higher than 32 MPa at the outset.  Taking that into account, in his opinion, the average strength after 6 years would be expected to be much higher than 35 MPa.  Thus, he reasoned, having regard to the CMT results, the Stage 2 slab was not compliant with the N32 specification when laid and was understrength.[123] 
  5. [446]
    Dr Woolcock also referred to the strength of the exterior slab to support his opinion that the interior Stage 2 slab was understrength.  He said in paragraph [84] (which also explained why suppliers target a higher strength):

Because of the statistical variability of concrete strengths, the mix design needs to target a higher strength so that the probability that the strength falls below the specified or characteristic strength of 32 MPa is 5%.  This means the minimum target strength should be the characteristic strength plus 1.65 times the standard deviation.  Hence  it is expected that the average strength at 6 years would be much higher than 35 MPa such as for the concrete outside Unit 10 and 11 which has an average core strength of 46.2 MPa and for the concrete outside Unit 12 and 13 which recorded a strength of 53.5 from a single core test.[124]

  1. [447]
    In making his point by reference to the exterior slab, Dr Woolcock assumed (as per the engineers’ specification) an exterior slab with a design strength of 32 MPa.  But he said nothing about the fact that concrete hardens because of a chemical process involving a reaction between cement and water/moisture.  An exterior slab is exposed to rain.  An interior slab is not.  According to other evidence, which I accepted, assuming exterior and interior concrete slabs of the same strength 28 days after pour; the exterior slab is likely to harden thereafter to a greater extent than the interior slab because the exterior slab is exposed to moisture which will trigger the relevant chemical reaction which causes the concrete to harden.  
  2. [448]
    A slab of 40 MPa was required to accommodate solid tyred vehicles.  A lower water to cement ratio (of, say, 0.45) would have provided better abrasion resistance ([117]).  However, in Dr Woolcock’s view, the principal cause of the breakdown of the wearing surface of Stage 2 was not the design or the lack of a proper briefing (about the loads the slabs would be bearing) but rather: (a) the uncontrolled addition of water; (b) the 100 mm, rather than 80 mm, slump concrete; and (c) the almost complete absence of testing for strength and slump ([122]).
  3. [449]
    Dr Woolcock was not able to provide an estimate of the anticipated life of the slab, although he said that some of the severely abraded areas were already at the end of their life from a surface functionality point of view.  (He did not more specifically identify those areas.). 
  4. [450]
    In cross-examination, Dr Woolcock agreed that the best way to compare the Stage 1 and Stage 2 concrete would have been on the basis of core samples from each – but he was not aware of any Stage 1 core samples.  Nor had he seen the delivery dockets for the Stage 1 concrete; nor could he say whether water had been added to Stage 1 loads; nor was he aware of how Stage 1 was constructed; nor did he ask for the design documentation for Stage 1.  He agreed that he would have been assisted in his comparison of the performance of Stage 2 compared to Stage 1 by any additional information about Stage 1.  
  5. [451]
    Dr Woolcock suggested two options for rectification of the Stage 2 slab: (1) demolition and replacement; or (2) remediation of the wearing surfaces.  While surface remediation would cause less disruption, it would not address the loss of structural pavement capacity because of under-thickness of the slab in some areas and understrength concrete in most.  Nor would it address the likelihood that the manufacturers and installers of coatings would not provide warranties because the concrete was understrength [06]. 
  6. [452]
    However, if the slab was adequate for current use, and if suppliers and contractors were prepared to offer warranties on surface treatments, then surface remediation  would be a valid option because the breakdown of the surface was principally due to the uncontrolled addition of water, and not to the over-loading of a too thin slab [46].
  1. [453]
    He accepted that there was always dust in premises like the Stage 2 premises.  He agreed that he did not test the dust to determine whether it was concrete dust.  He confirmed that he was told by the Stage 2 tenants, and accepted as true, their assertion that “excessive dusting was causing wear and tear on equipment”.  He said that he observed for himself the way in which the wearing surface, which had suffered abrasion, had limited the safe and efficient operation of the tenancies – although he had not substantiated that opinion in his report.  He said he had taken videos of the forklifts in operation but had not included them in his report.  
  2. [454]
    With respect to slump, it was put to Dr Woolcock that the fact that concrete with a 100 mm slump was ordered for a slab which was to be of a strength of 32 MPa did not render the concrete unfit for its purpose.  Dr Woolcock said it could because slump was an important criterion for surface hardness.  He agreed that surface hardness was something different from compressive strength and agreed that, if the order was for concrete of 32 MPa with a slump of 100 mm, there was no reason why such a slump would not result in concrete of that strength.  The 80 mm slump would increase surface hardness because it was associated with less bleeding/less fines/less cement paste, which may create a weak surface leading to dusting and abrasion.  However, one could not simply say that there would be less dusting with an 80 mm slump because other variables may contribute to dusting, such as the way in which concrete is cured or finished, or the admixtures added to it.[125]
  3. [455]
    As to the role of solid tyred vehicles, Dr Woolcock said that their use probably contributed to the breakdown of the wearing surface, but he could not determine “the portion” because the slab was understrength.  He also stated that there was “excessive dusting” in areas in which solid tyred forklifts were not operating, which was a consequence of the addition of excess water [141] and [142].  However, this statement was at odds with his other evidence that the slabs would not dust unless they were traversed by traffic.
  4. [456]
    Although Dr Woolcock stated that there was excessive dusting in areas in which solid tyred forklifts were not operating, he was no more specific than that about those areas.  Nor did he include photographs of any such areas in his report even though he was purporting to respond to the following two-part question:[126]

24  One Sector Pty Ltd alleges that the defects on the Concrete were caused by the use and operation of non-pneumatic tyred machinery.  In relation to that allegation:

  1. Please identify whether and to what extent the defects or damage to the Concrete is and was caused by the use and operation of nonpneumatic tyred machinery; and
  2. By reference to any photographs or observations, identify (if at all) any wear on the Concrete that in your opinion was likely caused by the use and operation of non-pneumatic tyred machinery and contrast that with other defects or damage that is not caused by such use and operation and explain why, in your opinion, the cause is different.
  1. [457]
    Dr Woolcock included in his first report photographs of “an aisle with surface breakdown in Units 10 and 11”,[127] which appeared to show breakdown adjacent to the joint[128] but not excessive dusting.  He also included in his report photographs of a solid tyre pallet truck which operated in Units 10 and 11.  He did not include any other photographs of the breakdown of the surface or of areas in which there was excessive dusting.  He did not include any photographs at all of Units 9 or 12 and 13 – apart from one photograph of the surface treatment in Unit 9. 
  2. [458]
    As to his opinion that there was a likelihood that manufacturers and concrete remediation specialists might not provide warranties for coatings because of understrength concrete – Dr Woolcock agreed that the average core strengths of the units in Stage 2 were (in 2022), in the case of two of them (Units 9, 12 and 13), over 32 Mpa, and in the case of one of them (Units 10 and 11), under 32 MPa by 0.3 MPa.  He agreed that the fact that the concrete was only just at, or under, 32 MPa did not mean “by itself” that the entity remediating the slab would not provide a warranty for its work.  He also agreed that the opinion he expressed about warranties was not based on his own expert analysis but rather, he was restating the opinion of someone else.  
  3. [459]
    Dr Woolcock and Dr Khan were the principal experts on the concrete’s strength.  Dr Woolcock and Mr Reid were the principal experts on the concrete’s thickness.  I have concentrated in this section of my judgment on Dr Woolcock’s opinion about the uncontrolled addition of water and the slab’s strength.  I have discussed Dr Woolcock’s opinion on thickness in more detail below.

Defendant’s expert: Dr Inam Khan

Report 6 April 2023[129]

  1. [460]
    Dr Khan is a civil engineer with 19 years’ experience in concrete, and particular expertise in the assessment of defects in concrete and in determining the strength of existing concrete structures.[130] His research and industry experience revolved around the investigation of the early-age properties and cracking behaviour of concrete.  He serves on a Concrete Institute of Australia committee and a RILEM committee.[131]
  2. [461]
    Dr Khan is not a structural engineer, he is a material technologist.[132] He was the defendant’s expert on concrete strength and was asked to assess the strength of the Stage 2 slab relying on the results of strength testing done by Testcrete[133] in 2022.
  3. [462]
    While he observed joint breakdown and abrasion of the internal Stage 2 slabs, he did not quantify the damage to determine if it was excessive after six years of service. He suggested that Mr Reid was the best defendant’s expert to answer questions about the consequence of the slab being traversed by non-pneumatic tyred vehicles.[134] Mr Reid is a structural engineer.
  4. [463]
    As mentioned, it was Dr Khan who introduced the notion of assessing the strength of the slab by reference to its characteristic compressive strength.  It will be recalled that, in his first report, Dr Woolcock expressed his opinion on the slab’s strength by reference to its average compressive strength.
  5. [464]
    Dr Khan’s executive summary included opinions to the following effect:
    1. “… The addition of water on site to achieve greater workability and higher slump would reduce the strength relative to what it would have been without water addition, but that in no way shows the specified strength was not achieved.”
    2. An analysis of the cores taken in 2022, as per AS 3600, CIA Z11 and BS EN 13791[135] all show that the characteristic compressive strength of the slabs exceeds the specified 32 MPa.[136]
    3. Because the concrete’s strength was, in 2022, about 32 MPa, it met the AS 3600 strength requirement for pneumatic traffic. Therefore, it was reasonable to infer that the damage to the slab was caused by hard-tyred vehicles.  
    4. “Dr Woolcock has contended that the internal slab concrete at the time of placing would have been lower than 32 MPa when allowing for the strength gain since construction.  He supports this by showing the strength of external pavements is currently higher than internal pavement.  I have shown that his contention is incorrect as the drier internal environment would have limited the continued hydration of concrete and hence lower strength gain with time is expected internally.  The strength difference between internal and external slabs is exactly as would be expected given the different exposures.”  
  6. [465]
    I note that Dr Woolcock could not say why the external slab was so much stronger than the internal one.  He made no reference to the fact that the external slab was open to the rain, but the internal slab was not.  He said, at ([132]):

Although the higher strengths for the hardstand concrete are not surprising, it is not clear why they are much higher than the internal core strengths.  Perhaps there was proper control over the addition of water and perhaps there was a different subcontractor who placed and finished the concrete.   

  1. [466]
    Dr Khan pointed out Dr Woolcock’s error in his failing to apply the multiplier in accordance with AS 3600 Appendix B.  Dr Khan’s explanation of the need for the multiplier is set out in the footnote to this paragraph.[137] However, by the time of the joint report, both Dr Woolcock and Dr Khan backed away from their application of AS 3600 Appendix B.  Instead, they followed the recommendations of Z11 and calculated the characteristic compressive strength of the Stage 2 slab in 2022 as 32.7 or 33 MPa.
  2. [467]
    Referring to Dr Woolcock’s observations about the strength of the external slab, and accepting that the strength of concrete increases over the long term, Dr Khan stated that strength gain, with age, was a complex process which depended not only upon the concrete mix proportions, cement content and the initial curing methods, but also upon environmental factors such as temperature, humidity and “availability to moisture” ([42]).  The strength gain to concrete in a dry environment was notably inferior to that in an environment characterised by regular precipitation, such as an outdoor environment.  The discrepancy was primarily attributable to the availability of moisture which was essential for the ongoing hydration process: that is, the chemical reaction between cement and water that generated compounds such as calcium silicate hydrate and calcium hydroxide, both of which contributed significantly to the concrete’s strength.  Data from the Bureau of Meteorology showed that the Stage 2 exterior concrete slab was exposed to rain on 137 days of the year (on average) [46]: an adequate amount of water, which facilitated the hydration process necessary for strength gain [47].
  3. [468]
    Mr Munn, another of the defendant’s experts, gave similar evidence.  Free water and a reasonable temperature were required for an increase in strength.  In Mr Munn’s experience, concrete slabs “virtually stopped” increasing in strength after 90 days because they were kept so dry.
  4. [469]
    Dr Khan referred to a study which showed that, in dry conditions, after one year, there was no increase in concrete strength ([45]).  He said:

The variation of concrete strength with age in wetted and dry conditions was studied by Baykof and Syglof (1976) reported in Assessment, Evaluation and Repair of Concrete Streel and Offshore Structures [… by Mohamed Abdullah El-Reedy, 2018, CRC Press].  They found that, in dry conditions, after one year, there was no increase in concrete strength.  On the other hand, the strength of specimens stored in wet environments (at 15°) was considerably higher.  This is presented in Figure 3.

  1. [470]
    As I interpreted it, Figure 3 shows a similar increase in concrete’s strength in wet and dry conditions from 28 days to one year after pour.  It shows very little variation in strength from year 1 to year 11 in dry conditions, and a significant increase in strength from year 1 to year 11 in wet conditions.  
  2. [471]
    Dr Khan concluded his opinion on the slab’s strength by asserting that the internal Stage 2 slab was not understrength.  He said ([48]):

… it is evident that the concrete strength in Units 9, 10 and 11 and 12 and 13 is higher than initially contended by Dr Woolcock, and the difference in internal and external core strength results can be attributed to environmental factors influencing the hydration and curing process.  Consequently, the assertion that the concrete placed in these units was understrength is not supported by the evidence when taking into account AS 3600 recommendations and the impact of environmental conditions on the strength gain of the concrete over time.

  1. [472]
    Dr Khan did not think a water to cement ratio of not greater than 0.65 was “fairly high” for a slab – as long as the concrete met its strength requirements at 28 days.  
  2. [473]
    Dr Khan explained that slump was an indirect measure of workability.  Workability was affected by the water to cement ratio, as well as other factors, including, for example, the aggregates and admixtures in the mix.  In his opinion, the fact that One Sector ordered concrete with a 100 mm slump rather than an 80 mm slump as prescribed should not have affected the slab’s ability to achieve a compressive strength of 32 MPa.  He said (at [54] – [55]):

… concrete mix designs are formulated to achieve target strengths regardless of the slump requirements.  For example, a concrete mix with a target strength of 40 MPa can be designed to have a slump of 100 mm or 200 mm.  The concrete mix supplier adjusts the mix in such a way that it does not compromise the final target strength.  Factors such as water-cement … ratio, cement content, aggregate gradation, and the use of admixtures play significant roles in determining the compressive strength of the concrete, rather than the slump values alone.

The slab would have achieved the same strength even with 80 mm slump as the premix concrete supplier ensures that the target is achieved regardless of the slump requirement.  

  1. [474]
    Dr Khan saw small-diameter, hard-tyred trucks in use in Units 10 and 11.  On the basis of his conclusion that the slab met the N32 requirement, in his view, if only pneumatic tyres had been used, the likelihood of slab damage would have been significantly diminished.  Thus, it was reasonable to infer that the observed slab damage resulted from the use of hard-tyred vehicles.  
  2. [475]
    The discussion of Dr Khan’s evidence in this paragraph and the one which follows illustrates his practical, rather than theoretical, approach to this matter.  Dr Khan acknowledged that unregulated and excessive water addition on-site could affect the compressive strength and surface hardness of concrete.  He acknowledged that on-site water addition increased the water to cement ratio, which resulted in a decrease in compressive strength.  Based on Dr Woolcock’s report, he assumed that water was added to 57 of the 204 deliveries of concrete.  However, the core strength tests actually conducted on the slab revealed a concrete strength higher than 32 MPa which indicated that the added water on-site did not significantly affect the strength of the concrete.  Nonetheless, it was necessary to consider the impact of the increased water to cement ratio on abrasion resistance ([66]).
  3. [476]
    He referred to Dr Woolcock’s use of New Zealand data at [67] of Dr Woolcock’s report (outlined above).  He acknowledged that the thesis which underpinned the CCAA report referred to by Dr Woolcock demonstrated that an increase in the water to cement ratio resulted in a reduction in compressive strength and decreased abrasion resistance.  However, for the Stage 2 slab, no reduction in strength was found on core testing, which indicated that the on-site addition of water had not influenced the strength of the concrete greatly and its abrasion resistance was likely to have been unaffected.  Nor did the core samples show any evidence of bleeding ([68] – [71]).
  1. [477]
    With respect to Dr Woolcock’s statement that concrete strength decreased by 2.5 MPa for every extra 10 litres of water per cubic metre, in Dr Khan’s opinion, the extent of the reduction in strength depended on “many aspects” including “cement type, admixtures, strength range” ([86]).  
  2. [478]
    Dr Khan conducted a second site inspection on 15 March 2023 ([72] – [78]) and reported the following: 
    1. The epoxy, which completely covered the slab in Unit 9 was generally in good condition, except at a few joints, where it had not been properly applied.  
    2. The slab in Units 10 and 11 was in a satisfactory condition, with minor defects in select areas.  The “most frequently observed issues” were at the joint locations, where there was fretting, surface breakdown and exposed aggregate.  Fretting may be caused by either poor design, or weak concrete, or both.  It may also be caused by small-diameter solid wheels traversing the joints even at moderate speed.  There was plastic shrinkage cracking in the slab panels near the entry doors of Units 10 and 11 and plastic settlement cracking in a few panels.  Plastic shrinkage was not an uncommon phenomenon in slabs.  The contributors to it included environmental conditions, the water-cement ratio, and the type and “amount” of admixtures used in the concrete mix.  
    3. Most of the trafficked areas in Units 12 and 13 had been covered with epoxy, which was intact and performing well.  There was cracking and a combination of plastic shrinkage and plastic settlement cracking in a few uncoated panels.
  3. [479]
    Dr Khan discussed the surface breakdown on either side of the joints in Units 10 and 11 ([79] – [82]).  He considered it highly likely that the concrete had been ground on either side of the joints to create a smoother surface for the small diameter solid wheeled traffic to traverse.  In his opinion, the breakdown of the concrete observed in the vicinity of the joints was likely a consequence of grinding and not a consequence of the concrete being of too low strength, because the breakdown was not evident in any other areas. 
  4. [480]
    In Dr Khan’s opinion, there was no major structural failure in the floor slab which warranted its replacement.  
  5. [481]
    In cross-examination, Dr Khan agreed that the main reason water was added onsite was to increase the workability of the concrete.  He agreed that, if water were added, but no tests were done, it would not be possible to know the effect of the added water on the slump or the surface fines or the concrete strength.  He added, “But there are then general indicators which can tell you that something has went wrong (sic).  For example, you will see a lot of cracks, you will see a lot of fine accumulations, you will see a lot of voiding, bleeding channels … and things like that [after the curing period]”.[138]  That was not something he saw (my emphasis):[139]

… I have the strength sample in front of me.  I have sent it to the lab.  I have examined it for any physical defects like voiding, bleeding channels, any accumulation of fines at the top.

… I personally examined all the, all the core samples that I’ve taken, I have supervised the coring process, because the coring process can also affect strength.  If, if you take a core which is not exactly vertical, if you create an angle in the core, that – you can end up having a lower strength.  So I haven’t noticed any signs of bleeding channels, I haven’t noticed any signs of accumulation of fines or any excessive voiding, and then I’ve sent the samples to the lab for strength testing.  And … I’ve done the statistical analysis … It comes out to be 33 MPa.

  1. [482]
    He said that, within certain limits, the addition of uncontrolled water may not have a substantial effect on concrete’s strength or other properties.[140]  
  2. [483]
    Dr Khan acknowledged that the application of B6.4.2 of AS 3600 gave mean strength, not characteristic strength.[141] He acknowledged the debates about the use of AS 3600 to determine characteristic strength. He explained that Australian Standards provided no guidelines at all about the determination of characteristic strength (where there had not been the testing as required by AS 1379) although there was Z11.  In his opinion, the Z11 approach was preferable.  He and Dr Woolcock had (eventually) adopted it and concluded that the in-situ characteristic compressive strength of the slab in 2022 was about 33 MPa.  Where they differed was in what that told them about the strength of the concrete in 2016.[142] In Dr Khan’s opinion, one could not “back calculate” from the concrete’s strength in 2022 its 28-day strength, as Dr Woolcock had done: that was the wrong approach.[143]  
  3. [484]
    In Dr Khan’s opinion any strength increase in the Stage 2 slab after 28 days would be minimal.  He explained that concrete used its water content (the hydration process) to harden in the first 28 days and achieved 90 to 95 per cent of its strength in that time.  Additional water might come from the environment – such as rain or ground water.  But in the case of Stage 2, there were membranes underneath the slab to prevent it from using ground water and it was not exposed to the rain.  
  4. [485]
    He was cross-examined about his reference to the Baykof and Syglof study and Figure 3, which demonstrated the effect of the environment on strength development with age, and which showed an increase in strength of 25 per cent in a dry environment.  Dr Khan said that he was not saying that 25 per cent should be used in the present case.  It depended on so many factors.  He referred to the table to compare indoor to outdoor environments.  He did not refer to the table to “come up with a number”.  He said that in a dry environment one would not expect a strength increase beyond 28 days.[144] The hydration process requires water.  If water is cut, then one would not expect any increase in strength at all: it was “[t]hat simple”.[145]
  5. [486]
    I asked questions of Dr Khan to ensure that I understood another aspect of his evidence (my emphasis):[146] 

HER HONOUR:  Dr Khan, can I, again, just ask you something to make sure I understand your evidence?---Yes.

So you said:

If the slab is constructed to design specifications, then it will achieve its 90 to 95 per cent of its strength within 28 days, if not 100 per cent.

?---Correct.

So, in the case of the slab that I’m interested in, the design specifications included an instruction that water must not be added after it leaves the batching plant unless ordered by the supplier … [I]f you assume that 3000 litres of water were added across the whole of this slab beyond anything specified by the supplier, so let’s call it “uncontrolled”, would you expect the slab to achieve 90 to 100 per cent of its strength within that 28-day period, or is that uncontrolled addition of water going to leave you uncertain as to when it would achieve 90 to 100 per cent of its strength?---Correct.  I think – as I said, I haven’t looked into the exact amount of – volume of water - - -

No?--- - - - which was added.

But if you just assume it was - - -?---Assume.

- - 3000 litres?---Yes, but – but we need to know that – what - what was the – the requirement of water.  Maybe it could be 15,000 of 20,000 litres of water, so we need to know what percentage was extra added.  If it is less than 10 per cent addition, I would not expect any - - -

Okay?--- - - substantial increase, but if - - -

So can I – just slow it down for me?---Yes.

So 10 per cent in addition to what? Ten per cent in addition to the - - -?---Total water.

- - - litres of water specified or - - -?---Yes.

Okay?---Yes.

Okay.  So - - -?---Because we are saying that’s 3000 litres but we’re not saying how much was the actual water in the mix for this 8000 cubic metres, or whatever the, the value is.

Or how much it was supposed to be?---Yeah.  Yes, that’s right.

…

MR WHITTEN:  Thank you.  So when the instruction from the design engineer is no water to be added unless ordered by the supplier, and the supplier, assume for the moment, doesn’t order the extra 3000 litres or anywhere near it, is it still your opinion that the – what you told her Honour about the 10 per cent variance.  Does that sound like it’s a 10 per cent variance to you?---I don’t know.  As I said, I haven’t gone into the dockets and I haven’t done the calculations - - -

Okay?--- - - of how much additional water was added.

Yes?---So 3000 litres doesn’t tell me anything, whether it was 5 per cent or 10 per cent of the total quantity.

…

  1. [487]
    I note that Dr Khan was referring to additional water up to ten per cent of the total water in the mix – not up to ten per cent of the volume of the concrete (cf the Holcim document and the definition of the water to cement ratio in AS 1379-2007 (above)).  
  2. [488]
    There was no evidence before me about the volume of water in the cement/water mix provided by Excel.  Nor was Dr Khan cross-examined about the Holcim statistic.

Defendant’s expert: Mr Lindsay Reid

Report 26 April 2023[147]

  1. [489]
    Mr Reid is a structural, geotechnical, and civil engineer of 49 years’ experience, with some speciality in the field of concrete pavements.  He was identified as the defendant’s structural expert.  
  2. [490]
    Mr Reid applied Clause B6.4.2 of AS 3600 to assess the strength of the Stage 2 slab.  He found it to be in the range of 36.5 MPa to 37.4 MPa.  He would not buy into any Z11 criticism of the application of that clause in determining the “strength” of the concrete.  
  3. [491]
    In his opinion, the Stage 2 slab was damaged by the hard wheeled vehicles.  The slab would not have been damaged if it was traversed only by pneumatic-tyred vehicles with the load capacities defined by the engineers.  The hard wheeled vehicles used in the Stage 2 tenancies imposed a high concentration of force at the edge of the sawn joints causing localised damage.  Also, the impact effect of the vehicles jumping across the dowel joints caused abrasion which would not have been caused by pneumatic tyred vehicles.
  4. [492]
    By the time of Mr Reid’s inspection of Stage 2, on 13 February 2023, the floor surface of Unit 9 had been coated with the epoxy.  In his opinion, it was in extremely good condition.  There was localised superficial deterioration of the surface across the central dowel joint - which ran from the front to the back of the unit – which was the result of the way in which the epoxy had been applied.  It did not adequately bridge the surface of the dowel joint.  He saw damage present at only one joint location, associated with its being traversed by hard-wheeled forklifts.  Its rectification was a maintenance issue.
  5. [493]
    In his opinion, the (uncoated) floor surfaces of Units 10 and 11 were performing well, except for localised damage at some sawn and dowel joints.  The floor surfaces in the trafficable aisles between the floor joints had no abnormal wear and tear.  The localised chipping observed at the sawn joints was minor and related to the passage of hard wheeled forklifts over the joints.  The localised surface abrasion in some locations adjacent to dowel joints was superficial and repairable via the application of a surface coating layer.
  6. [494]
    He saw that some of the aisles in Units 12 and 13 had been coated with an epoxy surface.  Areas of wear and tear appeared to have been repaired.  There was no damage under the storage racks (which were inaccessible by steel-wheeled vehicles).  
  7. [495]
    In his second report, Mr Reid estimated that the total area of surface deterioration which he observed in Units 10 and 11 was less than one per cent of the units’ floor area.[148]
  8. [496]
    The photographs included in Mr Reid’s report include annotations which set out his opinions or explanations for whatever characteristic of the slab or a tenant’s vehicles he photographed.  He photographed surface edge cracking damage (e.g. photograph  58), which he considered it to be the result of hard wheeled vehicles traversing a minor shrinkage crack.  He photographed several areas of “erosion” in unsealed parts of Units 12 and 13 (e.g. photograph 64), and described the damage at those sites as “minor superficial surface abrasion”.
  1. [497]
    Mr Reid saw no evidence of dusting and noted that Mr Munn, another of the defendant’s experts, saw no evidence of dusting either.  But without knowing how recently the slab had been cleaned, what they each saw on a particular day did not tell me much.  
  2. [498]
    Mr Reid considered the slab damage to be non-structural and easily repaired by the application of localised surface treatment.
  3. [499]
    In Mr Reid’s experience, 32 MPa concrete was the most common concrete strength specified by engineers “for a broad range of industrial uses”.  
  4. [500]
    When being cross-examined about the addition of water onsite, Mr Reid said: …[149]

[I]n practical terms, what happens on construction sites is that if there’s a relatively small amount of water, for example, 10 litres per cubic metre added, no one thinks any further than that, because that’s generally accepted as being relatively minor, a very small increase that’s going to have minimal impact … … 

  1. [501]
    While he considered 10 litres of water per cubic metre of concrete to be “probably not unreasonable”, he agreed that there was no engineering evidence or standard to support that proposition – although he noted that it was a parameter used by the Department of Transport and Main Roads: 

… Look, I don’t think that 10 litres a second (sic) is the magic number.  It could be higher than that … It could be lower.  But if it were a specification going to a main road, a bridge, a really important structure, that would be the … pass mark criteria.  And those structures are a lot more critical than this application.

  1. [502]
    He said, in effect, that adding water, in a controlled manner, by experienced people who understood slump would not create a real risk of the concrete suffering from bleeding or dusting.  In his experience, for the addition of water to cause a decrease in surface abrasion resistance, it would have to be uncontrolled and quite excessive.  He continued:[150]

In fact, the only time in my 50-odd year career as a structural engineer that I’ve experienced this sort of problem has been where … at the end [of a] concrete pour, it rained heavily and there was so much water on the surface that [that] created softness on the surface.  

  1. [503]
    With respect to slab thickness, Mr Reid agreed that the measurement of core sample lengths provided a reasonable basis for assessing general slab thickness – but they could not provide a basis for a definitive conclusion about the structural capacity of, or the loss of strength in, the slab.  This was because the samples taken represented a  very small area of the slab – about 1/20,000th of the total floor area.  This was also because some of the test samples might not be representative.  
  1. [504]
    In his opinion, the depth of the core samples recovered demonstrated that the slab was thick enough/had the structural capacity to carry the loading specified.
  2. [505]
    Mr Reid considered the Westera requirement for a 175 mm slab to be conservative for the loading anticipated.  This was because fifty per cent of the slab was sitting on solid rock.  
  3. [506]
    In his opinion, the evidence suggested nothing more than that “localised and nonrepresentative undulations in the sub-grade preparation have given rise to inconsequential localised variations in thickness”.   
  4. [507]
    In his opinion, the slab’s thickness was sufficient to accommodate “any reasonable wall loading effects”.  He was questioned about the meaning of “reasonable” in this context.  He said it could be “anything”.
  5. [508]
    He noted that the average thickness of the core samples exceeded the target depth of 175 mm.  In his opinion (having conducted certain computations), a slab of 160 mm would have been adequate to carry the nominated loading effects.  In crossexamination, he was criticised for taking the average of the samples.  He said he relied upon paragraph 15.3.3 of the CCAA document, which said, “Thickness determination: The thickness of the base shall be determined on the basis of the average of base-thickness measurements made on cores not less than 100 mm in diameter taken from selected points”.  He acknowledged that none of the cores taken were more than 100 mm in diameter but said that approach was “the best we’ve got” and all of the experts agreed on that approach.  He acknowledged that the diameter of the core samples “would have an accuracy effect potentially”, but he was prepared to accept the average.  He said it was totally unrealistic to suggest that a slab which was on average 170 mm thick might be 220 mm at one end and 120 mm at the other.  He said the photographs of the slab showed a relatively flat surface, so the thicknesses would be relatively uniform without outliers.  
  6. [509]
    He found no good reason for the removal and replacement of the slab.  It was structurally adequate for its intended use and its surface to be strengthened with a topping layer to address abrasion issues.  There was no basis for the slab’s rejection as per clause 17.1.7.3 of AS 3600.[151]

Dr Woolcock in reply

Report 6 July 2023[152]

  1. [510]
    In his reply report, Dr Woolcock acknowledged that he erred in not applying a corrective factor of 1.15 in determining the “strength” of the concrete in 2022 ([38]).  
  2. [511]
    He said he was then motivated to undertake a more comprehensive analysis of the core test results and the increase in strength over time. 
  3. [512]
    Dr Woolcock was of the view that the application of Clause B6.4.2 of AS 3600 led to an over-estimate of the characteristic strength of concrete for the reasons set out in the footnote to this paragraph.[153] He applied instead a European standard (EN 1992-1-1 Eurocode 2), and concluded that, at 28 days after its pour, the Stage 2 slab was no stronger than 26.8 MPa.  However, by the time of the joint report, he acknowledged that his application of the European standard was “inappropriate” and said he had moved on since.
  4. [513]
    Although he had “moved on” from it, Dr Woolcock was cross-examined about why he used it at all given that – 
  1. (as he acknowledged) its pre-requisites for use had not been met; 
  2. the European standard did not have a direct equivalent of N32; 
  1. it cautioned that its formulae ought not to be used if the concrete did not conform to the specification for its compressive strength at 28 days – when Dr Woolcock did not know whether it had or had not; and
  2. it cautioned that it ought not be used retrospectively.  
  1. [514]
    Dr Woolcock said that in the absence of any Australian method, he used it as “a guide”.[154] But he accepted there was no justification for the application of European standards to Australian concrete.[155]
  2. [515]
    Notwithstanding Dr Woolcock’s ultimate position, it is also worth noting Dr Khan’s criticisms.  In reaching his conclusion that the slab was only 26.8 MPa at 28 days after its pour, Dr Woolcock relied upon an assumed increase in strength of 19 per cent, as per the European standard, but as Dr Khan observed, that assumption was not substantiated by research-based evidence.  Further, Dr Khan pointed out, if the strength at 28 days was as low as Dr Woolcock asserted (26.8 MPa), one would have expected significant structural damage, given the traffic it endured.  Yet none was observed.  This lack of damage strongly suggested that the 28-day strength of the concrete was closer to 32 MPa, an assertion that was corroborated by the core sample tests, which revealed a mean compressive strength of 36.9 and a characteristic strength of 33 MPa.  
  3. [516]
    Mr Reid similarly considered it implausible that 28-day concrete strengths could have been as low as 26.8 MPa noting also that those assessments were derived using methods not recognised by AS 3600 and were theoretical. 
  4. [517]
    This is another example of Dr Woolcock’s theoretical rather than practical approach.  Applying the European Standard caused him to conclude that the slab was only 26.8 MPa – and yet he failed to attempt to reconcile that conclusion with the actual state of the slab.
  1. [518]
    In his reply report, Dr Woolcock re-stated his opinion that the uncontrolled addition of water resulted in under-strength in-situ concrete ([16]).  Ordering a slump of 100 mm weakened the concrete’s surface resilience because, while additional cement may be added to the mix to achieve the required strength, the added water increased the tendency of the concrete to bleed, thereby bringing more cement paste to the surface ([17]).  In addition to diminishing surface hardness and resilience, the uncontrolled addition of water resulted in a slab with lower structural capacity to support the wheel loads.  That lower structural capacity was further weakened by the concrete being under-thickness in 13 of the 62 locations where thickness was measured ([18]).
  2. [519]
    At [26], he applied BS EN 13791 (2019) to calculate, via a statistical method, the characteristic compressive strength of the slab in 2022 from the core testing results.  On his approach, the average of the 43 core results was 32.14 MPa; the characteristic compressive strength of the cores was 27.77; and the characteristic compressive strength of the slab was 31.94.  However, as Dr Khan pointed out, Dr Woolcock applied the BS-EN-13791 formula incorrectly.[156] Dr Woolcock applied the formula correctly by the time of the joint report and then calculated the characteristic compressive strength of the slab as 32.7 MPa. 
  1. [520]
    Dr Woolcock calculated that the slab was required to be 177 mm thick for unlimited repetitions of the design axel loads, for a characteristic 28-day concrete strength of 26.8 MPa at placement.  If the concrete were 32 MPa at placement, then its required thickness, to accommodate the design loads, was 168 mm – which confirmed that Westera’s design thickness of 175 mm was adequate ([60] and [61]).
  2. [521]
    Dr Woolcock criticised Mr Reid’s assessment that a slab thickness of 160 mm was sufficient.  Dr Woolcock argued that Mr Reid – 
    1. adopted loads which were significantly lower than the design loads; and 
    2. overlooked the reference to dual axel loading and failed to double the design wheel load nominated. According to Dr Woolcock, Mr Reid made other errors, which I will not detail here ([63]).  (Dr Woolcock and Mr Reid revised their opinions on minimum slab thickness by the time of the joint report.)
  3. [522]
    Dr Woolcock disagreed with Mr Munn that replacement was not warranted.  He said (at [64] and [65]):

Based on both the abrasion resistance and the load capacity of the pavement being non-compliant (due to the concrete being understrength) as well as the interior slab being under thickness in 21% of the locations measured, it would be reasonable in my opinion for the slabs to be replaced in order to obtain slabs of the quality which I have previously reported was required by the contracting parties.

However, the forklifts I observed were not loaded to capacity, and Hestbay may opt to minimise disruption to its tenants and proceed with remedial surface treatments instead.  

  1. [523]
    However, in his opinion, the remediated slabs would have a diminished range of forklift use, because the concrete was understrength and less than design thickness in 13 of the 62 interior locations measured for thickness.  Further, in determining whether remedial surface treatment was viable as an alternative to replacement, consideration had to be given to the indeterminate frequency of maintenance and replacement and the likelihood that manufacturers of surface treatment products would not warrant them because the concrete was understrength.

Dr Khan in reply to Dr Woolcock’s report

Report 29 August 2023[157]

  1. [524]
    Dr Khan was asked to prepare a supplementary report, setting out his further response to Dr Woolcock’s criticisms of his opinion. I do not need to detail in the body of this judgment his response to Dr Woolcock’s second report because of the position they reached in the joint report but Dr Khan’s response is set out in the footnote to this paragraph.[158]
  2. [525]
    Dr Khan calculated the in-situ characteristic compressive strength of the concrete as 33 MPa (as per BS EN 13791 and Z11).  This suggested that in 95 per cent of the tested area, the concrete’s strength surpassed this value.  
  3. [526]
    He emphasised his previous opinions:
    1. It is of paramount importance to recognise the role of moisture availability in determining concrete strength.  
    2. Concrete strength development is complex – heavily influenced by environmental conditions and the hydration process.  Z11 indicated that most concretes attained approximately 90 per cent of their final strength in their first 28 days, with subsequent gains being more modest depending on the availability of water.  
    3. The hydration process involves a chemical reaction between the water and the cementitious materials in the concrete mix, which produces a crystalline structure that interlocks and strengthens over time.  This ongoing reaction results in the concrete hardening and gaining strength.  Without sufficient moisture, this hydration process can slow down or even halt completely.  In conditions where moisture is limited or absent, such as in a dry environment, the necessary chemical reactions can’t fully proceed.  A normal N32 slab, which relied upon the hydration of cement alone for strength gain, would not exhibit a significant increase in strength in a dry environment.  
    4. Significant strength gains in a moisture deprived environment is improbable.
    5. A moisture rich environment facilitates continuous hydration, thereby promoting optimal development of strength in concrete.   
  1.  One cannot accurately quantify the strength gain in concrete over time – as acknowledged in Z11.  The gain in concrete strength with age is a complex process that depends not only on the concrete mix proportions, cement content and the initial curing methods.  Environmental factors such as temperature, humidity, and the availability of moisture significantly influence the hydration and curing process, affecting strength gain over time.  At best, a nominal estimate may be given. 
  1. [527]
    Dr Woolcock said under cross-examination that he was not a concrete technologist, but that he understood that concrete hardening stopped when the water ran out.  He’d never compared the strength of an outdoor and indoor slab (poured at the same time).  But he “would imagine” that the outdoor slab “would generally have a higher strength to it”[159]

Mr Reid in reply to Dr Woolcock’s report

Report 4 September 2023[160]

  1. [528]
    In Mr Reid’s opinion, the only relevant document was AS 3600 – not BS EN 13791 nor Z11.  The only accurate method for assessing concrete strengths as they existed six years ago would be to refer to the concrete cylinder test results of the time.  His assessment of the concrete’s strength of around 37 MPa meant that it was compliant with the engineers’ requirements.    
  2. [529]
    As to whether uncontrolled water had been added to the cement mix during the pour of the Stage 2 slab, Mr Reid said that a rate of 10 litres/m3 is within acceptable limits for adjusting concrete’s workability on site.  
  3. [530]
    The volume of water added had to be considered in relation to the volume of concrete.  He “added a column” to the uncorrected version of Dr Woolcock’s report and calculated the volume of litres per cubic metre.[161]  He found that only a small percentage of the concrete truck deliveries had in excess of 10 litres/m3 added – that is, only 7 of the 204 trucks, or 3.5 per cent of the entire concrete supply.  But he appears to have made an error in his own calculations, or at least included an irrelevancy.  Mr Reid has unnecessarily calculated the litres of slump stand water added to the concrete load per cubic metre for the loads to which no water was added at the customer’s request.  Slump stand water is not excess to the mix design – it is part of it.  He has also missed calculations for two deliveries (deliveries 56 and 59).  My own calculations for those deliveries led to values of 10.8 and 14.45 litres per cubic metre respectively, which would mean that 9 of the 204 truckloads exceeded the 10 litre per cubic metre metric (or 4.4 per cent).  
  4. [531]
    Mr Reid said that adding the relatively small volume of “touch up” water on site merely served to provide the volume of water within the range of allowable concrete slumps.  The water to cement ratio remained within acceptable tolerances (referring to Cardno’s test results).[162] He accepted that the addition of the excess of 10 litres/m3 was contrary to the DTMR criterion and could not be considered “touch up water”.[163]  However, Mr Reid found no evidence to suggest that the addition of water in excess of 10 litres/m3 on limited occasions had the effect of reducing the strength of the concrete below 32 MPa.  
  5. [532]
    He was asked about the statement in the Holcim document that each 10 litres of water per cubic metre would reduce the strength of concrete by 2.5 MPa.  He considered that was a general comment because all concrete mixtures were different.  
  6. [533]
    Mr Reid was asked to assume that One Sector added 2765 litres of water to the 204 loads of concrete, which totalled 1448 cubic metres of concrete.  Mr Reid quickly did the calculations,[164] and computed that, on average, two litres per cubic metre had been added, which Mr Reid considered insignificant.  He was asked to assume that only 54 of the 204 loads of concrete had water added.  That amounted to about 8 litres per  cubic metre – which he considered “perfectly reasonable”.[165] He maintained that the water added was very small in comparison to the volume of the slab but recognised that the better approach was to consider each individual truck.[166] 
  1. [534]
    As to the use of 100 mm slump rather than 80 mm slump, based on his experience, Mr Reid would not expect that to have caused the slab to experience abrasion or dusting issues.  He had “personally specified and accepted 100 mm slump concrete in concrete floors of this nature on 100s of occasions spanning a period of 45 years and [had] not encountered any adverse effects where pneumatic tyred vehicles were being used”.[167]
  2. [535]
    Mr Reid accepted that his loading assumptions in his previous report were incorrect.  Mr Reid re-evaluated the required slab thickness and structural design requirements using the structural design procedure from the CCAA’s Guide to Industrial Floors and Pavements.  He considered Dr Woolcock to have made a series of overly conservative assumptions in reaching his conclusions about slab thickness. Those assumptions concerned the accuracy of concrete strength and soil strength parameters, vehicle loading, depth of soil et cetera.[168] Mr Reid considered his approach more accurate than Dr Woolcock’s.[169] Their respective approaches to this calculation are discussed below.
  3. [536]
    In terms of replacement versus repair – Mr Reid’s view was that replacement was not justified under AS 3600.  The slabs in Units 10 and 11 had only localised damage at the sawn and dowel joint locations. The damage was not structural, only affected the surface, and was easily repaired. There was no surface erosion under the storage racks.  Nor was there erosion “to any obvious extent” away from the joints traversed by hard wheeled vehicles.[170]   
  4. [537]
    Mr Reid observed that he saw Budget Pet Product employees frequently vacuuming the aisles which had been covered with epoxy during his site visit.  He asserted that the dust being removed was from the stored products, not from deteriorating concrete.[171]  
  5. [538]
    In a statement which favoured the plaintiff’s case, Mr Reid stated that “Typically, concrete specified as 32 MPa would be referred to as concrete with a characteristic strength of 32 MPa and would be expected to reach strengths in excess of 36 MPa with time”.[172] He was asked in cross-examination whether he stood by that opinion.  He said, in effect, that he should have said that the concrete would be expected to increase in strength with time, without nominating 36 MPa.  He agreed that his foreshadowing of 36 MPa was consistent with a 12.5 per cent increase over time.  He said that would not be unusual but that it would depend on the mix.  

Defendant’s expert: Mr Robert Munn

Report 5 April 2023[173]

  1. [539]
    Mr Munn is a civil engineer, with 55 years of experience, which includes an active role on Australian Standards’ committees including for AS 3600, AS 1379 and AS 1012 and several investigations in “recent years” involving the assessment and repair of defective concrete surfaces.  Mr Munn was identified as the defendant’s expert on surface treatment.
  2. [540]
    He was asked to review relevant documents; to inspect and assess the Stage 2 slab; and to prepare a report about the condition of the polyurethane overlays on the floors (also referred to as a sealant, an epoxy, or Ucrete) and whether there were good reasons for the removal and replacement of the 8000 cubic metre slab.
  3. [541]
    Mr Munn inspected units 9 – 13 on 15 March 2023, accompanied by others.  The units had been in service for about six and a half years at that point in time.  
  4. [542]
    He concluded that the slab could be safely coated with Ucrete because its characteristic strength exceeded 25 MPa which provided sufficient tensile strength for an epoxy to stay fixed to the surface of the concrete.[174] The concrete was ground before the epoxy was applied, which meant no difference in surface levels and the removal of any surface contamination (such as cracking) which might have impacted upon the service life of the epoxy.[175] The cracking across the joints could be dealt with by removing the epoxy from the joint and applying a flexible sealant instead, which would allow the joint to “operate properly”.[176]
  5. [543]
    He saw no indication of a “serious deficiency in the strength of the concrete”.  He could find no structural damage – but that was something different from “surface ability” (sic? Serviceability).[177]

Units 10 and 11

  1. [544]
    Mr Munn found that the floors in Units 10 and 11, in which solid tyred forklifts with a capacity of two tonne operated, were generally in good condition. The joints between the slabs had been filled with flexible joint sealant which prevented debris collecting in them.  There was limited minor fretting at some joints (fretting leaves a ragged edge).  There was some fine plastic cracking of the concrete floor, adjacent to the southern roller door, with crack widths of 0.5 mm to 0.6 mm wide and 5 metres long in the same vicinity.  Mr Munn considered the cracks to have been present since early in the life of the warehouse floor, and due to the impact of rapid drying of the  plastic concrete adjacent to the door opening.  He did not observe similar cracking across the warehouse floor.  
  1. [545]
    In some trafficked areas of the units, slab edges had been ground to reduce the difference in levels and improve the ride quality for forklifts.  Joint sealants were well maintained.  Forklifts and pallet movers were able to locate pallets in high lifts without difficulty – thus floor levels were adequate for that purpose.
  2. [546]
    Mr Munn concluded that the maintenance carried out by the tenants had been sufficient to maintain a serviceable floor for solid tyred vehicles typically used in narrow isled warehouses.  Forklifts could not turn in those aisles.  They travelled back and forth, almost like on a rail track.[178]
  3. [547]
    Under cross-examination, he was asked about areas of the slab which he described as “intentionally” or deliberately ground to smooth.  He was asked for the factual basis of his “assumption” that the smoothness was not the result of wear and tear.  He said it was not an assumption, even though he had not seen anyone grind it.  It was exactly the pattern he would expect to see with deliberate grinding. He explained his processes – which suggest that he inferred that the slab had been ground:[179]

No, it’s not an assumption, because what I did when I looked at that is compare the wear pattern right across the exposed aisle.  Firstly, there was [no wear] naturally underneath the racking, but that would be expected.  But what I did see was that there was a wear pattern exposing some of the coarse aggregate in the concrete on either side of the joint, and it went right across the whole of the aisle.  Now, we’ve just been discussing earlier the way vehicles track going down an aisle and whether you could turn them, and various aspects.  But basically, what tends to happen is that the vehicles follow the same track all the time and they only vary slightly from the normal course, simply because they can’t go very far off course because of the presence of the racks.  And if I was to see dusting, or surface attrition in the regular patterns where the vehicles’ wheels passed, I would have said yes, that’s probably caused by the vehicle tracking.  But because that pattern was right across between the aisle, you’re getting right up into a situation where it’s highly probable (? improbable) that a forklift could get that close, so it’s been deliberately done.

Unit 9

  1. [548]
    Budget Pet Products were using pneumatic tyred forklifts and stock pickers as well as solid tyred forklifts with a load capacity of two tonne in Unit 9.  The unit had wide aisles, allowing the forklifts to turn in them, which increased the abrasion on the floor surface.  The floor was maintained in a dry state.  It was swept daily by ride-on sweepers (with pneumatic tyres).  There were small quantities of spillage and fine dust coatings below the racks and in floor areas which were not easily cleaned.  
  2. [549]
    The internal slab was covered by a layer of polyurethane, between 4 and 5.2 mm thick.  Mr Munn considered the surface generally in good condition – without chips or cracks  apart from defects in the coating where it had been continuously applied over movement joints.  With respect to those defects: movement of the joints had cracked the polyurethane at those points and created ragged edges (fretting).  Long parallel cracks had formed.  At these locations the thickness of the polyurethane was 1 mm to 2 mm.  This was a sign that more wear would be observed over time, although the current condition of the floor was good.
  1. [550]
    Mr Munn saw more trucks being loaded by forklift, and more other vehicles operating, in Unit 9 than in Units 10 and 11.  However, most of the forklifts had pneumatic tyres.  The use of the pneumatic tyred vehicles could be expected to reduce the wear on the polyurethane surface.  However, because the current tenants had only been there 18 months at the time of his inspection, and the condition of the floor before then was not known, he could not predict the surface life of the floor.  

Units 12 and 13

  1. [551]
    Solid tyred forklifts with load capacities of two tonne were in use in Units 12 and 13.  The wide aisles of the warehouse gave them space to turn, increasing the abrasion on the floor surface.  In his oral evidence, Mr Munn agreed that there would be abrasion caused by turning no matter what the tyres on the relevant vehicle were.  The sharpness of the turn would also affect the degree of abrasion of the floor.  
  2. [552]
    The polyurethane coated areas of Units 12 and 13 were narrower than the aisle widths but included all the floor surfaces trafficked by the solid tyred forklifts.  
  3. [553]
    The cold room floor, which was traversed only by shopping trolleys and pedestrians, showed the condition of the original floor, which had no significant wear on the floor surface or joints.  By way of contrast, some areas in the rear of Unit 13 had exposed coarse aggregate, indicating surface wear, and longitudinal cracking.  
  4. [554]
    Mr Munn considered the floor surface generally to be in good condition, although he noted that it had been in use, with the coating, for three years only.  
  5. [555]
    He considered the repairs to have been done in a professional and workmanlike manner, except for the coating over the movement joints (which could be easily rectified).  The coating provided a high strength, impermeable, abrasion resistant and serviceable floor coating.  He considered treating only the trafficked areas (and not, for example, under the racking) to be a cost-effective means of upgrading the floor surfaces to high wear.  Although the downside of BASF Ucrete MF was that it was not as skid and slip resistant as 32 MPa concrete when the floor was wet.  

General observations and opinions

  1. [556]
    Mr Munn noted that although forklifts with the same solid tyres and capacity were used in Units 10 and 11 as in Units 9, 12 and 13, Units 10 and 11 had not suffered the same degree of damage to the floor surface and the joints.  Solid tyred pallet movers with a heavier wheel loading than forklifts were also in use in Units 10 and 11 with minimal abrasion loss.  He considered the N32 concrete in Units 10 and 11 to be exhibiting satisfactory behaviour after six and a half years.  
  2. [557]
    The reason for the apparently satisfactory performance of the un-coated slab in Units 10 and 11 was not explored with the relevant experts.  Nor was any relevant expert questioned about the effect of the inability of vehicles to turn in Units 10 and 11 (because the aisles were narrow) upon the way in which the concrete wore beyond the questioning of Mr Munn which made the point that vehicles which were turning abraded the surface more than vehicles which were not.[180]  Of course, in the absence of evidence, I could not put the better performance of the slab in Units 10 and 11 down to the fact that forklifts could not turn in those units.
  1. [558]
    I note that Mr Munn said that the vehicles he saw in use, which included solid tyred ones, were “everything you can expect to see in a warehouse of that type”.[181]
  2. [559]
    Mr Munn’s report contained his opinion about the availability of alternative, costeffective solutions to the issues with the slab, such as concrete hardeners.  Essentially, his opinion about the use of hardeners was very positive.  On the assumption that the N32 slab had a compressive strength between 29 and 32 MPa, the application of a suitable surface hardener was likely to increase the slab’s compressive strength by 10 to 25 per to between 32 and 40 MPa.  In his opinion, the treatment “would enhance the hardness of the floor to provide a comfortable margin above the 32 MPa required by AS 3600 for pneumatic tyred vehicle use”.[182]  
  3. [560]
    He referred to the technical data sheets for BASF Ucrete MF, which indicated a compressive strength of 50 MPa and a tensile strength of approximately 6 MPa – that was 150 per cent and 200 per cent respectively greater than N32 concrete.  There were similar improvements in abrasion resistance and impermeability compared to N32 concrete.  
  4. [561]
    In his opinion, the floor treated with BASF Ucrete MF could be subject to “frequent” use by pneumatically tyred, solid tyred, and steel wheeled vehicles.  He qualified this statement in his oral evidence.  He said the BASF Ucrete MF which had already been applied might not provide a permanent solution.  There were already signs of cracking over the movement joints.  Also, the BASF Ucrete MF deteriorated in ultra-violet light.  It would need to be replaced at least once to achieve its minimum 40 years of service life (required by AS 3600).  However, its application substantially upgraded the N32 floor.
  5. [562]
    Under cross-examination, he agreed that the coating would have to be replaced twice, assuming a service life of 60 years.  Although he thought that parts of the slab would be satisfactory at 60 years, but other parts, like those exposed to the sun, might require replacement.  It all depended on the “micro-circumstances” which would include traffic and use.[183]
  6. [563]
    As to whether removal and replacement of the slab were justified, Mr Munn said that there was no technical justification for it – 
    1. The floor in Units 10 and 11 was resistant to the solid wheeled forklift traffic of the tenant.  It could be expected to be serviceable for the whole of its service life, with minimal maintenance.  (Obviously, that opinion assumes no change to the use of the Units.) 
    2. It was difficult to predict the long-term behaviour of the polyurethane which had been applied to the frequently trafficked areas of Units 9, 12 and 13 – although the treated part of the floor was currently serviceable.  The exposed concrete areas appeared to be generally in good condition and met the tenant’s expectations.  Unless use changed, the exposed concrete floors would provide the required service life of 40 – 60 years.[184]

Mr Munn supplementary report (in response to Dr Woolcock’s report)

1 September 2023[185]

  1. [564]
    Mr Munn was informed by the defendant that Dr Woolcock disagreed with him, including with what he saw of dusting and his opinion to the effect that Unit 10 and 11’s forklifts were able to function safely and efficiently.  He was asked to respond.
  2. [565]
    He said he did not see dusting caused by the abrasion of the concrete.  He was aware that dust was often blown into warehouse buildings from outdoors.  Regardless, dust on the floor was removed daily, as was a typical practice in racked warehouse facilities.  
  3. [566]
    He said he noticed no limitation on the operation of forklifts in Units 10 and 11; nor did he consider the dusting to be a health hazard.  
  4. [567]
    He agreed with Dr Woolcock that the manufacturers of surface treatments would not warrant their products if the concrete upon which they were applied was understrength. Referring to certain authoritative sources,[186] and applying relevant formulas, Mr Munn concluded that the Stage 2 concrete floors could be safely treated with BASF Ucrete MF.  The minimum substrate strength was sufficient.  It had already been demonstrated that the floors could be repaired to meet the tenants’ expectations.  The defects he saw were not structural but related to serviceability.  

Joint report[187]

  1. [568]
    Dr Woolcock, Dr Khan, Mr Reid and Mr Munn prepared a joint report in September 2023.  I was told that the experts drafted the questions which they answered in their joint report.[188]
  2. [569]
    The experts agreed on the following matters: 
    • The Building Code of Australia was the overriding control document in the Building Industry.
    • The relevant Australian Codes relating to the assessment of concrete strength were AS 1012, AS 1379, and AS 3600.
    • The CCAA design manual was a reliable design document.
    • No other codes overrode the AS 3600 stipulations.
    • The use of small diameter solid or steel wheeled vehicle traffic on the Stage 2 slab was outside the specified loading criteria.
    • The wheel loads specified were associated with a heavy vehicle not a forklift.
  3. [570]
    They did not agree, or gave qualified agreement to, the following matters, as below: 
  1. Q4 Does Clause B6.4.2 of the AS 3600 give the required method for converting average core strengths to “the strength of the concrete in the member”?

Woolcock:  No.  Because the question is misleading in that it implies an acceptance criterion which Cl B6.4.2 doesn’t provide and the question is too restrictive in that it does not allow for recording the conclave discussion on a critical issue ... 

It was agreed in reply reports that factoring the average core strength does not give the characteristic strength but it was not agreed what the compliance criterion for the factored average core strength was … 

Khan: Yes.

Reid: Yes.

Munn: Declined to answer. 

  1. Q6 Is there evidence to suggest that water was added in quantities which adversely affected strength and serviceability?

Woolcock: Yes

Khan: No.  Because field strength tests are > 32 MPa.

 

Reid: No.  Because field strength tests are > 32 MPa.

Munn: Declined to answer. 

  1. Q7 Is there evidence that “bleeding of concrete” occurred? (10 l/m3)

Woolcock: Yes.  The evidence of dusting and surface abrasion is a strong indication that bleeding of concrete occurred.  

The CCAA document Dusting of Concrete Surfaces states that the addition of water in excess of that required by the mix design generally increases bleeding.  

The inclusion of 10 l/m3 in brackets in this question is misleading because the total water added by the supplier and at the customer’s request exceeded 10 l/m3 on 32 of the 204 delivery dockets with up to 27.4 l/m3 added.  

Note that there were no entries in the spaces provided for ‘maximum water per load’, ‘slump stand water added’ or ‘water added at the customer’s request’ in 97 of the 204 delivery dockets.

Reid: No.  Furthermore, I consider that Mr Woolcock has misinterpreted various aspects relating to information recorded on the concrete dockets.  Water added in the concrete batching plant is part of the initial manufacture of the concrete and should in my opinion not be included in any assessments.  Having [sought] clarification of these issues I now consider the assessments in Appendix E of my report dated 4 September 2023, are conservative.

Khan: Decline to answer.  Has not been assessed.

Munn: Decline to answer.  Has not been assessed.

  1. [571]
    Dr Woolcock’s statements to the effect that the water was added in a volume of more than 10 litres per cubic metre in 32 of the 204 cement mix loads was not something that I could easily glean from his table (Exhibit 6); nor was it something he said in his written reports or oral evidence.  I infer that he performed relevant calculations for the purposes of the joint report.  However, Dr Woolcock’s count of the loads to which an excess of 10 litres of water per cubic metre of concrete was based on the sum of: (a) the total water added by the supplier (that is, the slump stand water) and (b) the water added at the customer’s request.  I did not understand slump stand water to be “excess” water – which seems to be the point made by Mr Reid in the joint report about Dr Woolcock’s misinterpretation.  If water is added by the supplier then it is the supplier’s responsibility to check thereafter that the concrete’s strength and slump are correct.[189]  As Mr Reid explained in his reply report (my emphasis), the slump stand water added on site is intended to achieve the supplier’s mix design:[190]

The “concrete mix” comprises a combination of cement … coarse and granular stone aggregate, and water.  How this mixture was  proportioned to achieve the required strength was the responsibility of the concrete supplier.

The total water of the concrete mix is dependent upon the volume of water added in the concrete batching plant, the volume of water present in the “fine particles” of the aggregate as moisture content, and the volume of water added on site for the purpose of adjusting workability and refining the water content already provided.

The “water content” in the fine aggregates can be difficult to accurately determine in the batching plant and additional water may [be] require[d] to be added on site prior to placement in order to achieve the mix designer’s required slump.  

Only the concrete manufacturer can determine the water/cement/strength relationship.

  1. [572]
    However, in his Appendix E, Mr Reid made the same error as Dr Woolcock made.  Mr Reid, correctly, did not treat slump stand water as excess when water was added at the customer’s request as well.  But he did treat it as excess when only slump stand water was added – contrary to the notion that the slump stand water added by the supplier was not to be considered “excess”.  I infer that Mr Reid appreciated his own mistake by the time of the joint report, which is why Mr Reid said in the joint report that his assessments were conservative.

Q8  Is there any evidence of dusting or surface weakness?

Woolcock: Yes.  

The CCAA document ‘Dusting of Concrete Surfaces’ states that a dusting floor surface is marked by an accumulation of fine material requiring to be swept up after the floor has been used.  

The evidence is the need for frequent ride-on vacuuming in Units 10 and 11.  There is also photographic evidence of areas of abrasion, not only adjacent to the joints.

All of the defendant’s experts said “no”.

  1. [573]
    As I’ve mentioned, Dr Woolcock’s observation of the dusting in Units 10 and 11 was inconsistent with the observations of Mr Reid and Mr Munn.  
  2. [574]
    Mr Rex complained about dusting in his affidavit evidence, but in his oral evidence he considered it “in the nature of the business” which was an ambiguous phrase, but one which suggested that he was not troubled by it.  Of course, Mr Rex’s personal tolerance for dust does not answer the question whether it was “excessive”.
  3. [575]
    Without more from Dr Woolcock, I could not identify the photographs of abrasion “not only adjacent to the joints” in Units 10 and 11.  Mr Reid took photographs of areas of abrasion away from the joints in Units 10 and 11, which he described as superficial.  I do not know if they were the photographs Dr Woolcock had in mind.  This was not clarified in evidence. 
  1. [576]
    Dr Woolcock said that issues with dusting were related to both concrete strength and surface hardness.  He said the easiest way to specify concrete was by reference to its compressive strength.  While not directly related to surface hardness, it was an important measure of surface hardness, but there were other things that affected hardness, such as curing and surface finishing – as the commentary to AS 3600 explained (at clause C 4.7).[191] 

Q9  Is there any evidence that the concrete slump exceeded 120mm?

Woolcock: No.  

However, this question is misleading as a NO answer could be taken to imply that the slump did not exceed 120 mm.  

There is no evidence that the slump did not exceed 120 mm given that no slump tests were taken after 18 April 2016.  

Any reference to the Cardno slumps tests is also misleading as the relevant samples were taken on 13 April 2016, before the first slab pour on 18 April 2016 and early on 18 April 2016 when no water was recorded as added.  So the Cardno slump tests were for Excel concrete as supplied, not as placed.

Khan: No.

Munn: No.

Reid: No generally – Cardno tests indicate not. 

Q11  Were forklifts referred to as [the] nominated load condition?

Woolcock: No.  Not explicitly but implicitly because the notes on Westera’s drawings state that ‘the slabs have been designed for pneumatic tyred vehicles only’ and ‘hard wheeled forklifts and machinery have not been allowed in the slab design’.

The defendant’s experts said “no”.

Q 12  Would slab surface deterioration have occurred if only pneumatic tyres were present?

Woolcock: Cannot be sure.  Could have been some damage because strength was not 32 MPa at 28 days if the increase in strength with time was between 5% and 10%.

The defendant’s experts said no because the slab was AS 3600 compliant.

Q14  Were forklifts nominated as a loading application which was designed for?

Woolcock: Not explicitly but implicitly because the notes on Westera’s drawings state that ‘the slabs have been designed for pneumatic tyred vehicles only’ and ‘hard wheeled forklifts and machinery have not been allowed in the slab design’.

All of the defendant’s experts said “no”.

Q 15  Was it acceptable to order 100 mm slump concrete and expect 32 MPa  concrete strength?

Woolcock: Yes, but 80mm slump was specified presumably because it’s better for surface hardness reasons and so 100 mm slump concrete should not have been ordered unless approved by Westera.

All of the defendant’s experts said “yes”.

  1. [577]
    Dr Woolcock said the basis for his opinion that 80 mm was better for surface hardness was the “CCAA dusting document”.  He also agreed that one might achieve a higher slump with the addition of an admixture to the cement mix; and that higher slump was not necessarily the product of the addition of additional water.[192]
  2. [578]
    I noticed that question 15 referred to concrete strength, but that Dr Woolcock answered by reference to surface hardness.  I asked him to explain.  He said that one might have 25 MPa concrete with an extremely hard surface because of the way in which it was finished.  One might achieve a concrete strength of 32 MPa with a 100 mm slump, but an 80 mm slump would achieve not only that strength but also additional surface hardness because there was potential for “less bleeding” the less water in the mix.  With less water in the mix, as is the case with an 80 mm rather than a 100 mm slump, less water will rise to the surface; with the consequence that “[w]hen it’s been finished, there’s less fines and less cement paste, which is the potentially weak surface which leads to dusting and abrasion.[193] Dr Woolcock seemed to be saying that the better question in this case was one which concerned surface hardness rather than strength.  He said:[194]

… [T]here’s a big focus on the – the strength of the concrete, but you could achieve 32 MPa and still have a very soft surface because of the water that’s been added and the higher slump that’s been ordered.  So it’s – it’s one thing to talk about the strength and the statistics and the analysis of it, but the fact is that water was added without approval, and that’s going to affect the surface hardness.  So you – you could still arguably comply with the 32 and – and have a soft surface. 

Q 16  Was there any specification on the drawings to nominate the requirement for abrasion resistance?

Woolcock: No.

Reid: No.

Khan: No.

Munn:  No,  but indirectly limited to traffic  by pneumatically tyred vehicles only.

  1. Q 17Is there any need for the current concrete strength to exceed 32 MPa to cater for the nominated vehicle loading effects?

Woolcock: Yes, for surface hardness.  

The increase in strength with time is a critical factor because if the minimum increase is between 5% and 10%, the maximum 28-day strength of the placed concrete would have been between 30.5 and 29.7 MPa and therefore noncompliant.  

No, for strength, where ‘strength’ in this context is the structural strength and therefore the slab’s load bearing capacity, but NO where strength is a measure of surface hardness. 

Reid and Khan: No.

Munn: No for surface hardness or strength.

Q 18  Is the increase in strength with time beyond 32 MPa relevant to current appraisals for strength?

Woolcock: Yes where ‘strength’ in this context is the structural strength and therefore the slab’s load bearing capacity but NO where strength is a measure of surface hardness.

All of the defendant’s experts said “no”

  1. Q 19Is there any evidence to suggest that the concrete thickness has resulted in (strength) which cannot cater for the nominated loading effects?

Woolcock: Yes, because 8 interior stab thicknesses measured from the cores are less than the 167 mm thickness I calculate as necessary to support unlimited repetitions of the specified wheel loading.  

Khan  and  Munn declined to answer this question.

Reid: No.

The 8 thicknesses represent about 13% of the 62 interior slab thicknesses measured.  It should also be noted that 21% or 13 of the 62 thicknesses are less than 170 mm which is the specified thickness of 175 mm less the 5 mm tolerance permitted by AS 3600.

 

Q 20  What is the current reliable concrete strength?

Woolcock: 32.7 MPa based on a statistical analysis of the CMT and Testcrete results using a method recommended in Z11 2021 and agreed by Dr Khan who obtained a rounded figure of 33 MPa in his supplementary report.

Khan > 32 MPa

Reid: 36 – 37 MPa

Munn: > 32 MPa

Q 22  What is the primary cause of surface damage?

Woolcock: Uncontrolled watering down of the concrete and use of hard wheeled vehicles.

The defendant’s experts said the use of hard wheeled vehicles.

  1. [579]
    In oral evidence, Dr Woolcock agreed that the solid tyred wheels would damage N32 concrete.  The dusting, abrasion and damage caused by those wheels would be similar to that which had been described in this case.  

Q 26 What is the minimum increase in concrete strength with time beyond the 28day value likely to be?

Woolcock: 5% to 10% given that there is no specific Australian research on the increase in concrete strength with time, it is implausible that past allowances of between 14% and 33% in the superseded Z11 2002 manual and relevant overseas allowances of up to 25% should now be considered negligible.  Therefore, in arriving at the 5% to 10% range, I have relied on the only published Australian allowance of a 10% increase at 90 days in the CCAA Industrial Floors manual and the phone advice of ‘somewhere between 5% and 10%’ from concrete expert Tony Thomas.  Tony Thomas was one of the contributors to Z11 2021 and was Boral’s Chief Engineer, Concrete.  

The increase in strength with time is a critical factor because, if the minimum increase is between 5% and 10%, the maximum 28-day strength of the placed concrete would have been between 31.1 (=32.7/1.05) and 29.7 (=32.7/1.1) MPa and therefore non-compliant. 

Reid: Can’t define. Could be around 5%.

Khan: Can’t define.  Could be as little as 1%.

Munn: 0% to 5%.  

While this is not relevant for structural strength as explained below, the non-compliance is relevant for the surface hardness because it confirms the uncontrolled watering down of the supplied concrete has weakened it. 

 

  1. [580]
    With respect, the statement “the non-compliance is relevant for surface hardness because it confirms the uncontrolled watering down of the supplied concrete has weakened it” is an over-statement.  More accurately, on the assumption of a 10 per cent increase in strength over time, the compressive strength of the concrete may have been weaker than design at 28 days and this may have had a bearing on the surface hardness of the concrete.  But 10 per cent was simply the best guess Dr Woolcock could muster and the hardness of the surface/its abrasion resistance was not tested.  In other words, in theory, one might expect less surface hardness, but it was not possible to say whether that was the case here because there had been no relevant testing.  
  2. [581]
    Also, Mr Thomas’ opinion meant little to me in the absence of information about the assumptions he was asked to make before providing it (ignoring any hearsay issues) and, indeed, proof of those assumptions.  Nor was Dr Woolcock aware of the reason why Mr Thomas nominated an increase of between 5 and 10 per cent.[195]
  3. [582]
    Further, this question and the experts’ answers draw no distinction between interior and exterior slabs.  Dr Woolcock agreed that, in the present case, the concrete should have achieved 100 per cent of its designated strength (of 32 MPa), 28 days after its pour.[196] It would continue to strengthen after that time – until “the point at which it runs out of water”.[197] But he was not asked when he thought the slab might run out of water in its dry environment or how the slab might continue to strengthen on the assumption that it “used up” all of its water at 28 days.
  4. [583]
    Dr Khan said that he could not define the minimum strength gain because the Stage 2 slab was moisture deprived. “Scientifically” one could not say that it would gain strength over time because there was no moisture.[198]
  5. [584]
    Mr Munn said that he based his zero to five per cent range on his experience.  He was asked whether it could be as high as ten per cent and he said, “Not necessarily”.  He said he thought the slabs were in such dry condition that there would not have been a significant increase in strength.  He referred to roads, without membranes underneath, subject to the weather and traffic, and said their realistic strength increase was between five and ten per cent.[199] This illustrates the problem caused by the question not differentiating between wet and dry environments.   
  6. [585]
    Mr Munn said that he knew of concrete which: increased in strength over time; decreased in strength over time; and did not increase “a great deal”.  He continued:[200]

… to increase the strength, you need to have both the presence of free water and you also need to have reasonable temperature … the concept is that of what’s called maturity which means that you get some sort of increase provided there’s free water available and it’s temperate and time increases.  That’s typically that it increases at a decreasing rate.  So its quite asymptotic.  So you eventually end up with a horizontal line … with time … It increases rapidly first … and then it gets slower and slower.

  1. [586]
    Of interest to me was also his testimony about changes in achieved concrete strength over time, and his testimony about the Stage 2 slab’s dry environment.  He said:[201]

However, I might say that when I started in the industry, working 50 years ago, we got much better long-term strengths than we get now because the – the manufacturers of cements and so on have managed to fine-tune cements to such a degree that they stop virtually after about 90 days …

And I’ve actually wrote … a paper this year … on that subject.  Even with … so-called … pozzolans … in the concrete as well which should promote strength increase … in this case … each of these slabs … is being treated and kept quite dry because they have a membrane underneath them so you don’t get water coming up underneath … the ground.  … [T]he are maintained dry by sweeping and cleaning on a daily basis.  So there’s very little moisture actually falls on the surface and the majority of goods that are held in there are not associated with liquids.  So they don’t get liquid spillings or anything of that sort.  So … the slabs are actually extremely dry.  So I wouldn’t expect very much … strength increase with time.

Q 27: With respect to item 60 of Dr Woolcock’s report dated 13 July 2023, the relevant experts hold the following opinions regarding the parameters utilised to determine slab thickness and the slab thickness required to sustain the loads which were nominated by Westera on the design drawing.  (Paragraphs 59 – 61 of Dr Woolcock’s report appear in the footnote to this sentence.)[202]

(i) Concrete strength used for assessment purposes.

Woolcock: 32MPa if the increase in concrete strength with time is 10%, the 28-day strength of the placed concrete is less than 32 MPa but the 10% increase at 90 days in the CCAA Industrial Floors manual would mean that 32 MPa has been achieved.

Reid: 32 MPa.

(ii) K1 factor

Woolcock: 0.90 – because it is the mid-range of the CCAA recommended range.  CCAA indicates three circumstances where the high end of the range may be appropriate, and I consider that at least two of these conditions have not been met.

Reid: 0.95.

(iii) K2 factor (associated with the number of load repetitions expected for the life of the structure for the nominated loading effects).

Woolcock: 0.50 for unlimited load repetitions based on what I consider is good design practice and because estimating the number of repetitions can only be guesswork.

Reid: 0.55 for heavy vehicle loading.

0.52  for  single wheeled vehicles.

(iv) Ess (Modulus reflecting soil support factors)

Woolcock: 41 MPa

Reid: 41 MPa.

(v) Wheel spacing for calculation of loading effects.

Woolcock: 1.45 metres for forklifts with 1.31 m dual wheel spacing (unconservative but reasonable).

Reid: 1.45 m based on a single tyre axel load of 6.2 tonnes.

2 m based on a dual wheel axel load of 9.6 tonnes.

(vi) Soil depth for assessment of the factor FH1

Woolcock: 3 m because the bore holes on the southern corner and on the eastern side show rock depths between 3.3 and 4.9 m and if all the fill is removed as recommended by Soil Surveys and not replaced, the depths of the natural soil are between 2.7 m and 3.7 m.  

The Soil Surveys’ report states that ‘the earthworks are envisaged to consist of minor cuts to fill to create a level building platform together with the removal of the existing fill material’.  

With rock near the surface on the western side, the average depth of soil under the floors will be less than 3 m but the design should be based on the larger soil depth of 3 m, not the average.

Reid: 1.5 m.

(vii) Calculated slab depth requirement to cater for the loading conditions nominated by Westera.

Woolcock: 167 mm.

Reid: 150 mm

  1. [587]
    This question concerns Dr Woolcock and Mr Reid’s determination of the minimum depth of the concrete necessary to support its design loads on the basis of a formula provided by the CCAA Guide to Industrial Floors and Pavements at page 26.  The variables or factors referred to in the table above are from that formula.  The CCAA’s guide provided a range for each of the variables and the basis upon which an expert would choose a value in the lower, middle, or higher part of that range.  
  2. [588]
    Obviously, Dr Woolcock and Dr Reid selected different values from within those ranges.  They were cross-examined about the reasons for their selections at some length.  Ultimately, both parties agreed that I did not have to choose between them.
  3. [589]
    With respect to rectification, the experts agreed upon the following: 
    • The surface can be coated or otherwise surface treated to achieve 40 MPa.
    • The damage was limited to trafficked areas, primarily at the sawn and dowelled floor joints.  (This was inconsistent with Dr Woolcock’s prior statements about damage at untrafficked areas.)
    • There was no evidence of structural damage.
  1. Q 23Will the slabs when appropriately treated at the surface provide adequate strength and serviceability to cater for all reasonable future loadings within the nominated loading parameters?

Woolcock: No because the slab thickness is less than the 167mm required based on 13% [of] the measured thickness being less than 167 mm (8 out of 62).  

Yes, if considering only surface wear and tear.

Reid: Yes.

Khan: 32 MPa is ok.

Munn:  Declined  to respond.

Valuation evidence

  1. [590]
    Because of my ultimate findings, which were not in the plaintiff’s favour, I have dealt with this evidence in an abbreviated way.  
  2. [591]
    Lisa Murdoch, of Jones Lang LaSelle Pty Ltd, a registered valuer, was asked by the plaintiff to estimate: (a) the value of Hestbay’s site (units 9, 10, 11, 12 and 13) “on the assumption that the internal concrete works are defective in the ways identified in the Engineer’s Report and on the basis of the costings in the [Quantity Surveyors’] Report; and [(b)] the Market Value of the property on the assumption that the internal concrete works are not defective and had been constructed in accordance with the contract free of any defects”.  She was also asked to “identify and assess the expected diminution in the value of [Hestbay’s site] as a consequence of the defects identified in the Engineer’s Report”.  
  3. [592]
    The Quantity Surveyors’ costings for a demolition and rebuild, or for remediation, were based on Dr Woolcock’s opinions about the state of the slab, the defendant’s breaches, and what he considered necessary to rectify those breaches. 
  4. [593]
    Ms Murdoch prepared three reports and participated in a joint experts’ report.
  5. [594]
    In Ms Murdoch’s first report, she referred to the “noticeable degradation of the ground slab concrete” and included in her report photographs of what she described as “the obvious damage”, which were taken during her inspection of the property.[203]  
  6. [595]
    I note her valuation conclusions in her report of 19 October 2022, at page 3904 of Part D, summarised at page 3848 which were later revised.
  7. [596]
    Ms Murdoch’s supplementary report is dated 24 November 2022.[204] It provides the revised valuations, which took into account revised construction costs.  The valuations are set out at pages 3953 – 3954 and summarised at page 3948.  
  8. [597]
    Assuming no defects, Ms Murdoch valued the property at $13,200,000 (plus GST) in April 2016; and at $21,300,000 (plus GST) in October 2022.  Ms Murdoch valued the property adopting capitalisation of net income and direct comparison approaches.  
  9. [598]
    Ms Murdoch explained her approach to the calculation of the diminution in value of the property, assuming defects, at page 3900.  She calculated the diminution in value on two bases: “Option 1 – Rectification and finish with a sealant” and “Option 3 (sic) – Rectification to the original specification”.  She calculated the diminution in value as at April 2016 as $5,820,000 (on an Option 1 basis) or $4,400,000 (on an Option 3 basis).  She noted that, arguably, further deductions could be made associated with the compensation of tenants, but she was not qualified to estimate those costs.  
  10. [599]
    Martin Hurry, a registered valuer with Acumentis Pty Ltd, was engaged by the defendant to prepare a valuation report.  His report is dated 18 April 2023.[205] He considered the warehouses’ current use to be their highest and best use.
  11. [600]
    I note his valuation at pages 4836 to 4839.  In his opinion in April 2023, the market value of the property “as is” for “low impact industry and office” use was $21,300,000.  
  12. [601]
    I note also his responses to “Lawyer Queries” at pages 4886 to 4888.  The final question and answer were as follows:

Do you agree or disagree with [Ms Murdoch’s] conclusion in Section 10 (note I am not instructed to calculate an alternative valuation)

In view of the design, layout, presentation and market sentiment, as outlined throughout the body of this report, the valuation figure as of 6th October 2022 amounting to $21,300,000 appears just and reasonable.  [That was Ms Murdoch’s valuation assuming no defects.]

In view of the discussions above, the valuation figure of 6th October 2022 of $14,480,000, reflecting the costs of repair and incidental costs of $6,820,000, is not justifiable and does not reflect market value.  [The $6,820,000 figure for diminution in value as at 6 October 2022 was taken from Ms Murdoch’s first report.  As above, she revised it down in her supplementary report.]

The adjusted value equates to an initial yield of 8.25%, which as illustrated within the table of sales evidence, (Section 8) is well above market expectations.  

  1. [602]
    Mr Hurry prepared a supplementary report dated 10 May 2023.  He discussed, at 4, his opinion about the impact of a restriction to pneumatic tyred vehicles on rental income.  He said – 

I am unaware of any rental evidence to suggest that if the tenants were restricted to use pneumatic tyred vehicles only this would affect the rental value.  From my experience of valuing premises such as the subject, this is not the case.  My experience suggests that a tenant’s priorities in selecting premises are the location, floor area, layout and design of the building.  If the premises meet these criterium, the tenant will have limited concerns, if any, regarding the type of tyres utilized on their plant and machinery.  Furthermore, it is quite likely new plant/machinery will be acquired for new premises and any machinery acquisition would be in the knowledge of the restrictions on machinery type.

I have not encountered the use of pneumatic tyred vehicles as a relevant factor in a rental determination.

  1. [603]
    Ms Murdoch was asked to prepare a reply expert valuation report, in response to the report prepared for the defendant by Mr Hurry, and did so.  It is dated 6 July 2023.[206] It is worth noting the following question (from the plaintiff’s lawyers) and her answer (my emphasis in her answer), which implies that Ms Vandepol did not in fact consider the slab to be relevantly deficient: 

9. Do you agree with the opinion of Mr Hurry in respect of General Comments regard the leases … that the floor treatment works to Unit 9 is considered an improvement to the extent that it would increase the rental value of the premises?  If not, please explain why not.

I do not have sufficient evidence to conclude that additional rental would be payable as a result of the floor treatment.  If the concrete floor was without defect and the building “fit for purpose” as per the permitted use within the lease then no treatment would have been necessary.  In this instance the tenant required the treatment to ensure the building was “fit for purpose”, therefore no additional rental is warranted.

I note that on page 8 of the Supplementary report “General Comments regarding the Leases”) Mr Hurry comments “I note that the floor surface of Unit 9 has been treated with an epoxy-based resin, or similar product.  Discussion with the lessee who accompanied me during my inspection, revealed that the floor treatment was at her request to suit her business needs and not due to a defecting flooring”.

This was not my understanding or impression when I inspected the property with the lessee’s representative.  My understanding … was that the epoxy treatment was installed at the request of the tenant to overcome the issues of defective crumbling concrete so that the building could be used for warehousing.  The lessee’s representative walked through the building and pointed out with some care particular areas where the concrete had failed.

  1. [604]
    Ms Vandepol was not cross-examined about her – on its face – prior inconsistent statement about her motivation for calling for treatment of the slab in Unit 9.
  2. [605]
    Ms Murdoch and Mr Hurry then prepared a joint report, dated 13 September 2023.[207]  They agreed upon the following:
    1. Their basic methodology and market value assessment before the deduction of any discount associated with any diminution of value as per the Hestbay Pty Ltd claim.
    2. If the floor is required to be replaced in its entirety, it would be unlikely that a sitting tenant would be able to remain in the building during rectification works.  If a tenant were to vacate during rectification works then it was unlikely that they would return to the premises, in which case costs associated with reletting the premises would be an appropriate deduction in the assessment of the market value of the property.
    3. If the concrete floor does not have to be replaced in its entirety, but repair works to the surface are necessary, a sitting tenant may be able to remain in occupation during repair works, in which case, the costs associated with reletting the premises would not be appropriate, however a rental incentive/discount for the period of the repair works may be appropriate. 
  1. If no repair works are necessary then no costs associated with reletting the premises would be appropriate.
  2. The magnitude of the repair works deemed necessary will affect the Capital Adjustments.
  1. [606]
    They disagreed about the following – 
    1. Capital adjustments – The valuers disagreed on the level of capital adjustments adopted.
    2. Whether the remedial work done to Unit 9, prior to the commencement of the tenancy to Budget Pet Products Pty Ltd, should be classed as an incentive.
  2. [607]
    Mr Hurry was questioned about his opinion that there was no reduction in capital value as a consequence of the “pneumatic tyred vehicles only” limitation.  He said the only time such a limitation would affect the valuation would be if one type of tyre was harder to get, or more manoeuvrable, or more expensive.  
  3. [608]
    He was asked to assume that a prudent and willing buyer was aware of the defects set out in the report of the quantity surveyor and would make an allowance for having repair works undertaken.  On that assumption, he agreed that a contingency reduction was appropriate.

Main Issues

  1. [609]
    The parties agreed that exhibit 1 set out the main issues for me – in the sense that the plaintiff framed the issues and, without binding itself to their precise wording, the defendant considered that they were generally encapsulated by exhibit 1.  
  2. [610]
    While the issues as drafted broadly captured the essential factual issues and provided me with a structure for my decision making, I re-framed them as necessary so that they aligned more closely with the pleadings; the decisions I had to make; the way in which the case was conducted; or the parties’ ultimate submissions.  Where I reframed an issue, I have explained why.  The sub-headings below reproduce the issue as drafted by the plaintiff.
  3. [611]
    As the following discussion of the issues reveals, I found on the balance of probabilities that – 
  1. The contract terms for Stage 2 included those contained in AS 4902-2000; and the Tender Letter of 23 May 2015.  While the Stage 1 Tender Letter itself did not form part of the Stage 1 contract, I found that the Stage 2 Tender Letter formed part of the Stage 2 contract because it was among the “contract” documents sent to Mr Hutchins on 10 July 2015.  
  2. The terms of AS 4902-2000 applied only to the extent to which they were not inconsistent with the terms expressly agreed upon by the parties, which included those spelt out in the Tender Letter of 23 May 2015.  
  3. The Stage 2 contract’s terms did not include One Sector’s Commercial Contract’s terms and conditions.   
  4. On a speculative basis, One Sector was to construct for Hestbay a warehouse, like the 100 it had constructed since 2009 – that is, a warehouse for general industrial use, with a slab floor of 32 MPa.  One Sector was also required to construct a slab of 175 mm thickness so that the slab could accommodate walls at any location, without the need for additional footings.  One Sector was not required to construct a warehouse with a slab which would accommodate hardwheeled vehicles.  
  5. The Stage 2 slab’s specifications rendered it fit for purpose.
  6. The Stage 2 slab degraded, cracked, and dusted to an extent beyond that which would be expected with normal wear and tear.  
  7. The Stage 2 slab was not performing as well as the Stage 1 slab under similar conditions of use.
  8. The defendant’s contractual obligation, when it came to the slab’s strength, was to construct a slab of a characteristic compressive strength of 32 MPa at 28 days after its pour.  
  9. It was more probable than not that the slab was not quite at 32 MPa at the 28day mark – but such a breach was inconsequential (or de minimus) because it was more probable than not that the slab was at 32 MPA at the time of practical completion.  
  10. The plaintiff failed to prove that the slab was not of its required thickness because there had been no determination of thickness in accordance with the CCAA Guide to Industrial Floors and Pavements and I could not therefore apply the relevant paragraph (paragraph 15.2.4).
  11. Alternatively, “making do” with the measurements available and calculating therefrom the slab’s average and characteristic thickness, the slab was of its required thickness.
  12. Alternatively, even if I ought to have found the spot failures in thickness to amount to a breach of contract, there was no evidence that those spot failures rendered the slab unfit for its purpose, including the purpose of its bearing walls anywhere.
  13. The concrete’s slump (of 100 mm) was not in accordance with the contractual requirement for slump (of 80 mm), however there was no evidence that the 100 mm slump affected the slab’s strength. Nor was there evidence that the 100 mm slump affected the slab’s abrasion resistance or surface hardness.  
  14. There was no evidence about whether the engineers’ maximum water to cement ratio had been exceeded.
  15. I was not persuaded that it was more probable than not that the addition of “uncontrolled” water to the cement mix on site at One Sector’s request was an effective cause of the damage to the slab.
  16. Any comparison between the performance of the Stage 1 and Stage 2 slab was flawed.  Yet even on the flawed comparison, as the plaintiff’s expert said, the better performance of the Stage 1 slab may well have been down to its Helix Fibre Reinforcement, which was not used in the Stage 2 slab.  
  1. [612]
    It follows that Hestbay has not been successful in its claim against One Sector.

Issue 1:  Whether the contract terms were those in an AS4902 – 2000 Design & Construct sent by the plaintiff on 10 July 2015, or the terms of what the defendant says is its “Commercial Contract”, which the plaintiff had a copy of as of 23 March 2016? 

My re-framing: What contractual terms governed the design and construction of Stage 2?

  1. [613]
    The suggestion embedded in this issue as originally drafted, that the plaintiff was in possession of the Commercial Contract on 23 March 2016, was not established in evidence.  
  2. [614]
    Twenty-three March 2016 was the date upon which Mr Ray asked Mr Hutchins whether he could pick up “the contracts” the next day; and the day upon which Mr Hutchins said they would be left at reception.  On the evidence before me, nothing was collected on 23 March 2016; and no documents were sent to Mr Hutchins to replace the AS 4902 contract between 10 July 2015 and 23 March 2016.  Therefore, I ignored the last phrase of the issue as drafted and, instead, considered the parties’ arguments about the contract which governed Stage 2 as they were expressed in their pleadings.  
  3. [615]
    I found that the contract terms for Stage 2 included those contained in the Australian Standards contract AS 4902-2000.  I say “included” because I found that the Tender Letter of 23 May 2015 was also part of the contract.  That led to inconsistency between some of the contractual terms, leaving the issue of the construction of the contract to me.  
  1. [616]
    Given the parties’ focus in Stage 2 on the detail of the Tender Letter, I found that the terms of AS 4902 applied only to the extent that they were not inconsistent with the terms expressly agreed upon by the parties – including those spelt out in the Tender Letter.[208]
  2. [617]
    I reached the conclusion that the parties contracted on AS 4902 terms, rather than on One Sector’s terms, primarily on the basis of – 
    1. my analysis of Mr Ray’s oral testimony as set out above under the heading “The Stage 2 contract”; 
    2. the fact that the AS 4902 contract sent by Mr Ray to Mr Hutchins acknowledged that Stage 2 would proceed without a Superintendent, which clearly implied that it had been prepared for Stage 2 purposes;

    and  

    1. a statement by Mr Ray, in his email of 4 March 2020, which clearly implied that Mr Ray was aware that One Sector had contracted with Hestbay for Stage 2 in AS 4902 terms.  
  3. [618]
    I did not need to be satisfied of the truth of Mr Ray’s oral evidence that he had instructed his contracts’ administrator (who was not a lawyer) to somehow amend or merge the terms of the AS 4902 contract with One Sector’s Commercial Contract before sending it to Mr Hutchins.  Whether he gave that instruction or not, the only contract sent on behalf of One Sector to Mr Hutchins for Stage 2 was the AS 4902 contract, unamended by One Sector’s contracts’ administrator.
  4. [619]
    In my view, the statements in Mr Ray’s emails of 10 July 2015, (which attached the AS 4902 contract) “same as stage 1 just different docs” and “the rest of the main body remains the same”, supported the conclusion that Mr Ray intended to contract on AS 4902 terms.  Indeed, the reference to the “same” “main body” can only be a reference to the AS 4902 contract. 
  1. [620]
    Although the Stage 2 contract sent on 10 July 2015 included the Stage 2 Tender Letter itself (as well as incorporating some of its detail into Part F) the bare, general statement in the Tender Letter, that One Sector’s terms and conditions applied, could not override the detailed AS 4902 conditions which were sent with it, construing the documents reasonably as a whole.  
  2. [621]
    The AS 4902 contract required a Superintendent and there wasn’t one for Stage 2 – a point relied upon by One Sector to support an argument that the parties did not contract on that basis.  But the AS 4902 contract sent by Mr Ray reflected the parties’ agreement to proceed without a Superintendent for Stage 2.  The Stage 2 AS 4902 contract sent by Mr Ray to Mr Hutchins stated “Not Applicable” in the space designated for the nomination of a Superintendent.[209] That was consistent with Mr Hutchins’ evidence about his decision to dispense with the services of GMP.  Thus, the AS 4902 contract sent by Mr Ray was tailored to meet the parties’ agreement to proceed in the absence of a Superintendent for Stage 2 – which supported an inference that it was sent by Mr Ray with the clear intention of its governing Stage 2.[210]  
  3. [622]
    Further, Stage 2 reached practical completion on 2 August 2016.  In his email of 4 March 2020 about the defects in the Stage 2 slab, Mr Ray stated that the applicable defects liability period ended on “2/8/2017”, which implied a 12-month period:  One Sector’s Commercial Building Contract provides for a 6-month defects liability period.  The AS 4902 contract provides for a 12-month defects liability period.  Plainly, in 2020, prior to this litigation, Mr Ray was proceeding on the basis that the parties had contracted for Stage 2 on AS 4902 terms.  
  4. [623]
    Additionally: 
    1. One Sector attempted to somehow rely on the fact that it sent its Commercial Contract to Hestbay on 30 May 2014, for the purposes of Stage 1, in support of its contention that that was the contract which applied to Stage 2.  But the evidence revealed that, on the advice of GMP, and because of the position of its financier, Hestbay had not contracted on One Sector’s Commercial Contract  terms for Stage 1 as One Sector desired.  It had, in effect, rejected them and contracted on the terms contained in AS 4902.  Nothing in the evidence provided a reason for concluding that Hestbay would not reject One Sector’s terms again if they were proposed for Stage 2.
  1. There was no evidence that Mr Ray said anything to Mr Hutchins which conveyed Mr Ray’s concerns about the AS 4902 contract.  Indeed, Mr Ray did not articulate what those concerns were, if indeed they were genuinely held.
  2. On the evidence before me, the Stage 1 contract had been completed without difficulty.  One Sector did not identify any reason why Hestbay would have agreed to different terms for Stage 2.  Nor did anything in the evidence suggest such a reason.  Nor did One Sector suggest that Hestbay had been informed of One Sector’s desire to contract on different terms.  Indeed, Mr Ray’s conduct, in sending the AS 4902 contract (twice) on 15 July 2016, conveyed the opposite.  
  3. It could not reasonably be argued that the contractual terms governing the fit out of units in Stage 2 – One Sector’s Commercial Contract terms – which were sent to Hestbay on 15 December 2017, applied to the design and construction of the Stage 2 warehouses when:
    1. they were delivered in a completely different context, for a narrow purpose; and 
    2. well past 2 August 2016, the date of practical completion of Stage 2.  
  4. Additionally, the contract sent on 15 December 2017 was a construction only contract – not a design and construct contract – which was one of the issues GMP had with it for Stage 1.  In other words, it was inapplicable to the work in fact undertaken by One Sector for Stage 2.  
  5. One Sector’s variation claims included a margin of 10 per cent, which was the margin provided for in the AS contract.  One Sector’s contract provided for a margin of 20 per cent.
  6. (Of less weight) One Sector entered into sub-contracts in August 2015 and February 2016 which assumed the existence of a head contract.  And One Sector’s progress claims, the first of which was sent on 25 September 2015, assumed the existence of a contract.   
  1. [624]
    Mr Ray was – in effect – the defendant.  Given his oral testimony, which I accepted, I did not engage with One Sector’s “one shot” doctrine argument about the contract.

Issue 2:  Whether the slabs in Stage 2 are defective because of durability and strength problems, including by exhibiting degradation to parts of the surface, cracking in various areas and excessive dusting?

My re-framing: Were the Stage 2 slabs defective, in that they were exhibiting degradation, cracking and excessive dusting?

  1. [625]
    Five questions were embedded in this issue as originally drafted, namely – 
    1. Was the Stage 2 slab defective in that its surface degraded, it was cracked, and it generated excessive dust (ignoring the protective effect of the coating)?
    2. Did it have “durability problems”?
    3. Was it defective because it had durability problems?
    4. Did it have strength problems?
    5. Was it defective because it had “strength” problems?
  2. [626]
    My response to this issue is a response to (a) only.
  3. [627]
    Questions (b) and (d) relate to the question whether the slab was built to specifications and whether there is evidence of its being “understrength” or of reduced surface hardness.  They are dealt with below.  Questions (c) and (e) concern the cause of the defects.  They are dealt with below,
  4. [628]
    As I’ve said, I found it difficult to make findings of fact about the state of the Stage 2 slab.  The evidence about its condition was inconsistent.  And by the time it was expertly examined for the purposes of this litigation, much of the slab had been either completely coated or partly coated by an epoxy.
  5. [629]
    There was no independent expert evidence before me about the slab’s condition at the time of the tenants’ original complaints.[211]  
  6. [630]
    The lay evidence about its condition from the tenants, Mr Hutchins, Mr Willmot, and Mr Ray is discussed above under the headings: “Tenants’ complaints about the Stage 1 and Stage 2 slabs”; “Hestbay’s investigation of, and response to, the alleged defects”; and “Mr Ray’s observations of the Stage 2 units”.
  7. [631]
    There was hearsay evidence before me about investigations in 2020 which revealed surface breakdown, surface abrasion, dusting and shrinkage cracking.
  8. [632]
    Mr Ray’s email of 4 March 2020 seemed to imply that he had observed that, in some parts, the Budget Pet Products slab had been “reduced to the stone beneath the surface”, at least in its trafficked or heavily trafficked areas.  Yet in his evidence before me, he claimed that he saw no evidence of any wearing, abrasion, cracking or dusting of the Unit 9 slab; and only two “patches” of concrete of concern in unit 12: a patch which was rough and worn, either side of an armour joint; and another at the boundary between Units 12 and 13, at which there was chipping out and wearing.  He claimed to have seen no cracking or dusting in Units 12 and 13.  He claimed that – apart from the two patches mentioned – the concrete appeared to him to be in the same condition in which it was laid.  
  1. [633]
    Mr Ray’s evidence about Units 9 and 12 and 13 was inconsistent with the evidence of Ms Vandepol, Mr Hutchins, and Mr Willmot and with his own 4 March 2020 email.  
  2. [634]
    The best evidence available about the state of the whole of the Stage 2 slab (before much of it was coated) was the evidence of the condition of the slab in Units 10 and 11.  However, as I have explained above, that evidence was inconsistent.
  3. [635]
    I preferred the oral evidence of Mr Rex about the state of the slab in Units 10 and 11 to the evidence of the parties and their respective witnesses about it.  On his evidence, the dusting he experienced was, in effect, not unexpected.  And repairs to the joints had solved his issues.  
  4. [636]
    Nevertheless, for the purposes of this matter, and to the plaintiff’s benefit, I proceeded on the basis that the Stage 2 slab was not performing as well as the Stage 1 slab; and that it was degrading, cracking, and dusting to an extent beyond that which would be expected with normal wear and tear.  The critical question of course was why the Stage 2 slab was defective.

Issue 3:  If the contract was the AS 4902 contract, was the defendant aware of the purpose of the slabs, and if so, whether the slabs as constructed were “fit for purpose”, given that was required by cl 2.2(a) of that contract? 

My re-framing: What was the intended purpose of the Stage 2 slab – stated or otherwise?  Would the Stage 2 slab’s specifications render it fit for its purpose?  Was the Stage 2 slab built to its specifications?

  1. [637]
    The plaintiff’s particulars of its assertion that the slab was not “fit for purpose” included the following:

Carrying out the Works so that they were fit for purpose required the Defendant to construct the Internal Concrete Slabs:

  • in accordance with the Concrete Specifications and the Concrete Works Requirements; and, or in the alternative
  • so that the tenants or other persons occupying the land could reasonably use the relevant land for their intended purpose, including as industrial or warehouse premises.
  1. [638]
    Not only clause 2.2(a) but also clauses 2.6 and 2.7 of the AS 4902 contract were relevant to this issue.  They are set out above under the heading “The Stage 1 Contract”.  In brief, they required One Sector to design and construct the slab in accordance with the Contract Documents and so as to ensure that it was fit for its intended purpose. 
  2. [639]
    Five questions were embedded into the issue as drafted, bearing in mind the particulars and the evidence about the clauses in the contract, namely – 
    1. Was the purpose of the Stage 2 warehouse “stated”?
    2. Stated or otherwise, what was the purpose of the Stage 2 warehouse? 
    3. Was One Sector “aware” of the Stage 2 warehouse’s purpose?
    4. Was One Sector aware of the Concrete Specifications and Concrete Work Requirements?
    5. Was the Stage 2 slab built to those specifications? 
  3. [640]
    The purpose of the Stage 2 slab, from Hestbay’s point of view, was not “stated” anywhere.  The trial proceeded on the basis that Mr Hutchins and Mr Ray had conversations about it.  
  4. [641]
    There was no issue about One Sector not being “aware” of the slab’s purpose (as One Sector understood it), or the requirement that it be built to specifications.
  5. [642]
    Thus, this issue was re-framed by me as follows:
    • What was the intended purpose of the Stage 2 slab – stated or otherwise?  
    • Would the Stage 2 slab’s specifications render it fit for its purpose?
    • Was the Stage 2 slab built to its specifications?  (This was captured by Issue 4 as drafted by the plaintiff and is dealt with under that heading.)

What was the intended purpose of the Stage 2 slab – stated or otherwise?

  1. [643]
    The plaintiff argued that the defendant was obliged to build it a warehouse which would accommodate the vehicles of commercial or industrial tenants of all kinds – including tenants who wished to use hard-wheeled vehicles, thus requiring a 40 MPa slab.  
  2. [644]
    The defendant replied that, “the works were reasonably fit for purpose, the purpose being for use as an “Industrial Building”, and that the express purposes included that the Internal Concrete Slabs were designed for traffic by pneumatic tyred vehicles only”.[212]
  3. [645]
    As was the case for Stage 1,[213] the Stage 2 AS 4902 contract anticipated that Hestbay would include in its “Item 10” “the stated purpose” for which the works were intended.  It did not do so.  Nothing in writing stated or defined the warehouses’ purpose in anything other than a very general sense.  The Stage 2 Tender Letter simply referred to a “Factory Warehouse” and a “tilt panel design with a structural steel roof” building.  
  4. [646]
    One Sector invited me to conclude this issue in this formal way.  It submitted that the express “fitness for purpose” clause was limited to the purpose as per the written requirements of the Principal, and there were none.  If there was any purpose at all – it was limited to One Sector being required to build a warehouse, with a slab thickness of 175 mm, so that walls could be erected anywhere.  One Sector also reminded me that the only oral part of the contract alleged by Hestbay was its offer and acceptance.  The rest of it was written.
  5. [647]
    Taking things at their best for the plaintiff and not limiting the “purpose” to that which was written, I found that Mr Hutchins and Mr Ray did not discuss the intended purpose of the Stage 2 warehouse from Hestbay’s point of view in any detail.  Hestbay provided no “brief” to One Sector.  And neither Mr Hutchins nor Mr Ray had any idea of the activities of the entities who might ultimately occupy the completed warehouses. I agreed with Mr Ray’s characterisation of the buildings as “speculative”.  
  6. [648]
    I accepted that references to “light industry” by Mr Ray may have meant little to Mr Hutchins.  But I found on the evidence that Mr Hutchins was: (a) keen for Hestbay to get into industrial warehouse property development; (b) turned to Mr Ray because of his experience in the construction of industrial warehouses; and (c) intended Mr Ray to build for Hestbay the sort of warehouses he had built for others – that is like the 100 he’d built since 2009 (which all had slabs of 32 MPa) which had been deployed for general industrial use.  I found that Mr Hutchins gave the matter no more thought than that.  I cannot articulate with any more precision, in a positive way, a finding about the Stage 2 warehouse’s intended purpose from Hestbay’s point of view.  But I  did find that its intended purpose did not include letting the premises to tenants who required a slab of 40 MPa – which, on the evidence, would not have been common in construction of this kind.  
  1. [649]
    My finding about the slab’s purpose, and that it did not extend to construction of a 40 MPa slab, was supported by – 
    1. the evidence of Dr Woolcock that, in the absence of a detailed brief from Hestbay which identified the intended use of solid tyred vehicles on the slab, or specified floor finishes, the design of the slab was suitable for general industrial use;  
    2. the evidence of Dr Woolcock that the engineers’ assumptions about wheel loads and pneumatic tyred vehicles were reasonable in the absence of more detail from Hestbay; and  
    3. the evidence of Mr Reid that, in his experience, 32 MPa concrete was the most common concrete strength specified by engineers for a broad range of industrial uses. 
  2. [650]
    One Sector accepted that, under the AS 4902 contract, One Sector was aware that one of the warehouse’s purposes was to accommodate tenants who wished to put walls “anywhere”.  

Would the Stage 2 slab’s specifications render it fit for its purpose?

  1. [651]
    The short answer is “yes”.  The warehouse was to be built on a speculative basis for general industrial use.  Hestbay’s brief did not include a requirement that the slab be of 40 MPa to accommodate hard wheeled vehicles.  In those circumstances —  
    1. A 32 MPa slab was sufficient. 
    2. The thickness specified was an over-engineer for the loads contemplated.  
    3. Ultimately, it was not suggested that ordering a mix which included a 100 mm slump rendered the slab unfit for its purpose.  It was accepted by Dr Woolcock that Excel would have adjusted the mix as required to achieve N32 concrete with a 100 mm slump.  
    4. I was not persuaded on the evidence that the water to cement ratio of a maximum of 0.65 was an inappropriate specification for the slab.  

Issue 4:  Whether the slabs were constructed in breach of the terms specified on either version of the contract, which specified the depth and strength of the concrete to be constructed? 

  1. [652]
    My re-framing (to ensure that I considered all issues):  Was the slab built to its specifications as to strength, thickness, slump, and water to cement ratio?  
  2. [653]
    I was required to determine whether the Stage 2 slab was constructed – 
    1. at its specified strength of “32 MPa”; 
    2. with a thickness of 175 mm; 
    3. using an 80 mm slump mix; and 
    4. with a water to cement ratio of not greater than 0.65? 
  3. [654]
    The answer to this issue was mostly to be found in the evidence of the experts Dr Woolcock, Dr Khan and Mr Reid.  I have analysed their evidence in detail above, under the heading “Expert Evidence”.  My findings on Issue 4 are based on inter alia that analysis.  But I wish to say something further about the quality of the evidence of Dr Woolcock and Dr Khan.  For the following reasons, I found Dr Khan’s evidence of higher quality.  
  4. [655]
    My concerns about the evidence of Dr Woolcock included the following:
    1. Dr Woolcock’s calculations in his first report were attended by error.  He was content to express his opinion about the strength of the slab in 2022 in terms of the mean, corrected, compressive strength of core samples taken from the slab.  But he failed to apply the formula from AS 3600 B6.4.2: he failed to multiply the average corrected core compressive strengths by 1.15. 
    2. In his later report, Dr Woolcock decried the use of mean, corrected, compressive strength as a reliable measure of “strength” and instead adopted an assessment of characteristic compressive strength at 28 days as the basis for determining whether the Stage 2 slab was built to its specifications.  But he did not explain why his use of the mean had been his first resort.  Nor did he explain why he made the error involving the multiplier.
    3. Dr Woolcock applied a European Standard in his second report, but that standard: (a) did not differentiate between wet and dry environments; (b) applied to mean, not characteristic, strength; and (c) was based on European laboratory results.  Dr Woolcock acknowledged that it was inapplicable and “moved on” from its application in the joint report. 
    4. In assessing strength in 2022, in accordance with the approach recommended by the Z11 guideline, Dr Woolcock applied the wrong factor (he multiplied by 1.15).[214]  
    5. Dr Woolcock made other errors, which have been identified in these reasons.  I acknowledge that it can be difficult to work with numbers and that Mr Reid made errors too – but Dr Woolcock made more errors than I expected.     
    6. Dr Woolcock used statements in authoritative documents in a blunt way.  For example, he claimed that the CCAA’s Guide to Industrial Floors and Pavements “indicated” a 10 per cent increase in concrete strength between 28 and 90 days when in fact, the guide stated that the 10 per cent increase was “frequently assumed” for flexural strength; he mis-interpreted the way in which Dr Khan relied upon the study by Baykof and Syglof; and he over-stated the message conveyed by Figure 3.  
    7. Although Dr Woolcock prepared a table which contained relevant entries from the 200-plus concrete delivery dockets, he failed to include an analysis of the dockets in his reports (putting to one side for the moment the Joint Report) or in his oral evidence.  Dr Woolcock’s general evidence about the impact of excess water on concrete was not of much assistance to me without his linking it to the evidence in this case.  An analysis of the water added to the cement mix for the Stage 2 slab was necessary to assist me to understand the per centage of water added at the customer’s request per load, or whether it exceeded 10 litres per cubic metre.  I undertook a limited analysis myself – which, for obvious reasons, I should not have been required to do.  
    8. I infer that Dr Woolcock performed some sort of analysis of the data in his table for the purposes of the Joint Report because he referred in it to the total water added by the supplier and at the customer’s request exceeding 10 l/m3 on 32 of the 204 delivery dockets, with up to 27.4 l/m3 added.  But that analysis was flawed because it wrongly assumed that water added by the supplier was “excess”.
    9. Dr Woolcock – 
      1. did not explain how the addition of excess water to a quarter of the 200plus loads impacted upon the strength of the entire slab;

      nor – 

      1. if it did impact upon the strength of the entire slab – how much weaker the whole slab was because of the addition of the excess water;  
      2. if it did not impact on the strength of the entire slab – how I should understand its impact (for example, did it lead to a slab of uneven strength and if so, what would that mean). 
  1. Dr Woolcock did not satisfactorily acknowledge the role of variables other than water added at pour which may have an impact on the increase in the strength of a concrete slab over time.  In particular – 
    1. he ignored the significance of the Stage 2 slab’s dry, interior, environment in offering his opinion about its strength increase over time.
    2. he provided no evidence which explained how the Stage 2 slab might increase in strength in its dry environment after it had “used up” the water in the cement mix (including the slump stand water and the water which had been added at One Sector’s request).
    3. he could not say why Stage 2’s external slab was so much stronger than its internal one, even though the obvious answer was that the external slab was exposed to rain and the internal slab was not.  Rather than that obvious explanation, Dr Woolcock wondered whether the external slab had been poured by a different sub-contractor or whether there had been proper control over the addition of water to it.  
  2. Dr Woolcock tended to take a theoretical approach to his evidence rather than relate it to the facts of this case.  For example: 
    1. Dr Woolcock’s report attached copies of photographs of the core samples taken by CMT, but he made no observations in his report about the samples themselves – such as whether he saw (in the photographs) physical defects in the cores like voiding, bleeding channels, or the accumulation of fines at the top, which might indicate overwatering or strength or surface hardness issues.

The obvious place to refer to relevant characteristics of the concrete (as shown in the photographs of the CMT core samples or otherwise) was after paragraph [93] of his first report.  Paragraph [93] read: 

It is pertinent to note that one of the effects of too much mixing water listed in the Holcim document is “Dusting and scaling – bleeding of excess water brings too many fines to the surface of floors”.  Similarly, a data sheet published by Cement Concrete and Aggregates Australia entitled ‘DUSTING Concrete Surfaces’ states that dusting is caused by the wearing surface being weak and the matrix not properly bonding the fine aggregate particles as shown in Figure 19 [an extract from the text of the document].  The data sheet goes on to state that the addition of excess water increases bleeding which results in more water and fines at the surface of the slab and ultimately in a weak, permeable surface layer with lower resistance wear.  

Despite this being the obvious place to relate the contents of the Holcim document and the CCAA data sheet to the Stage 2 slab to show (if he could) the bleeding or the “too many” fines, Dr Woolcock did not do so.  In other words, he set out what authoritative documents had to say about excess water (the theory) but did not relate those statements back to the facts of this case (the practical).  

  1. Further on this point, under cross-examination, Dr Woolcock admitted not only – 
    1. that he did not say in his report that he saw any evidence of overwatering in the photographs, such as segregation in the concrete mix or any sand streaks on the surface, or voids, 

    but also

    1. that he had not actually seen such things in the photographs or on-site.[215]

Dr Woolcock was not asked, in cross-examination or re-examination, to reconcile the statements he took from the authoritative documents with  his own observations of the cores.  Nor did anything in his evidence provide a basis for such a reconciliation. 

  1. Similarly, nothing in Dr Woolcock’s evidence explained why Dr Khan saw no sign of excess water in his examination of the cores taken by Testcrete under his supervision if Dr Woolcock was correct about the effect of “uncontrolled” water on the Stage 2 slab.
  2. Even if Dr Woolcock wished to differentiate between the effects of additional water on strength and the effects of additional water on surface hardness – he neither performed, nor requested, tests of the hardness of the slab’s surface to take this any further. 
  1. More generally, Dr Woolcock’s opinions on relevant issues were not supported in an explicit way by photographic evidence or evidence of his own observations, as he was asked to do.  Indeed, the absence of proof by Dr Woolcock of what he said he observed may have been another basis upon which the defendant could have objected to his evidence – see Sanrus Pty Ltd & Ors v Monto Coal 2 Pty Ltd & Ors (No 7) at [99].  By way of example, even though: 
    1. the plaintiff’s lawyers provided Dr Woolcock with images of the completed slab and its deterioration;[216]
  1. Dr Woolcock took photographs and a video himself when he inspected the site; and 
  1. the plaintiff’s lawyers expressly asked Dr Woolcock to identify damage to, defects in, or wear of, the concrete by reference to “any photographs or observations” –[217] 
    1. Dr Woolcock did not refer to photographs of the floor surfaces of Units 9, 12 or 13 (prior to the application of the epoxy) to support his opinions about their deteriorated state;
    2. Dr Woolcock’s reports did not refer to photographs of the uncoated floor surfaces of Units 12 and 13 to support his opinions about defects in the uncoated locations;
    3. his reports did not include any photographs of the dusting which he claimed constituted a health hazard in Units 10 and 11; and 
    4. his report did not include the video which he said he took at his site visit.

This may be contrasted with Mr Reid’s use of 71 photographs to support his opinion about the state of the slab.[218]

I acknowledge that Dr Khan included very few photographs of the slab in his reports – but he was asked different questions and the onus of proving the defects claimed fell on the plaintiff.[219] 

  1. I did not accept Dr Woolcock’s assertion that AS 3600 nominated concrete strength grades for trafficked pavements/floors in anticipation of the concrete getting stronger over time.  Frankly, that would make no sense.  Table 4.6 of AS 3600 prescribed the minimum strength requirements for trafficked pavements/floors.  The extent to which the pavement or floor might strengthen over time was irrelevant – as it had to be to make the setting of a minimum meaningful.  
  1. [656]
    In general terms, Dr Khan’s evidence was strengthened by the following:
    1. Dr Khan had a particular expertise in determining the strength of existing concrete structures.  
    2. He was a material technologist and, as effectively admitted by Dr Woolcock, had a superior understanding of the way in which concrete hardened in a wet versus a dry environment.
    3. Dr Khan’s evidence about the impact of the Stage 2 slab’s dry environment on its potential strength gain over time was intelligible, logical, and unchallenged.
    4. Dr Khan actually examined the Testcrete core samples and found no sign which would indicate any excessive water issues.
    5. Dr Khan pointed out the several errors made by Dr Woolcock – which implied that he had studied Dr Woolcock’s opinions with care.  
  2. [657]
    I will turn now to the issue of the slab’s compliance with its specifications.

Strength – the defendant’s obligation

  1. [658]
    There was a dispute about the content of the defendant’s obligation under the contract when it came to the slab’s “strength”.  
  2. [659]
    The Stage 2 contract’s Tender Letter specified the internal slabs as “175 mm with 32 MPa concrete” with “Reinforcement to Engineering Design”.  
  3. [660]
    The engineers required One Sector to use N32 concrete for the ground slab.
  4. [661]
    The plaintiff contended that the contract required the defendant to build a slab with a characteristic compressive strength of 32 MPa at 28 days or at practical completion.  
  5. [662]
    The defendant submitted that it did not: it merely required “the use of … N32 concrete” – that is, “concrete of that particular strength at the time it’s supplied”; and that “what it actually achieves at 28 days can be the subject of environmental conditions … it may or may not get there exactly on the twenty-eighth day ... it’s not something that is particularly calculated or required under the contract”.   
  6. [663]
    Further, the defendant submitted that the overriding control document was the National Construction Code (NCC) – as all of the experts agreed.  It submitted (uncontroversially) that I ought to interpret the written contract by ascertaining the meaning the document would convey to a reasonable person having the background knowledge reasonably available to the parties at the time of the contract.  It submitted that this would have included the obligation to comply with the NCC.  
  7. [664]
    It then referred to clause B1.4(b) of the NCC (see above, under the heading “Authoritative Documents other than Australian Standards”) and contended, in effect, that only AS 3600 B6.4.2 was relevant to the strength assessment for the purposes of determining whether the concrete met its specifications (to, in turn, determine whether One Sector was in breach of its contractual obligation as to strength).[220] On a B6.4.2 assessment, in 2022, the “strength” of the concrete in the member exceeded 32 MPa.  Its 2022 average strength, of 36.9 MPa, was more than a five to ten per cent increase in (presumably, average) strength of 32 MPa over time.  Thus, the defendant submitted, it was not in breach.
  1. [665]
    I found the defendant’s arguments about its obligation an unreasonable way to interpret the contractual requirement for the strength of the Stage 2 slab.  First, Note C1 to the engineer’s drawings required “all workmanship and materials to be in accordance with AS 3600 … and the referenced standards therein”.  That meant that the “N32” requirement was to be construed in the context of the relevant standards. Secondly, the NCC did not limit its reference to “AS 3600” to Appendix B of the standard.
  2. [666]
    The Stage 2 slab was a pavement which would be trafficked by pneumatic tyred vehicles.  
  3. [667]
    A careful reading of AS 3600 reveals that it requires such a slab to be of a characteristic compressive strength of 32 MPa at 28 days.  The variable in the second column of Table 4.6 of AS 3600, “f’c”, is defined in 3.1.1.1 as “the characteristic compressive strength of concrete at 28 days”.  This interpretation was reinforced by a consideration of all of the relevant Australian Standards as a whole regime.  See, for example, Clause 1.5.2 of AS1379-2007.
  4. [668]
    The defendant submitted that a requirement that the slab be of a certain characteristic compressive strength at 28 days after its pour was not a commercially sensible obligation.  I do not agree.  The construction of Stage 2 was governed by Australian Standards.  A slab which was to bear traffic would be non-compliant with Australian Standards (and at risk of failing) were it not of the characteristic strength required by Table 4.6 of AS 3600 at 28 days.  Requiring it to so comply was eminently commercially sensible.  It was also eminently sensible for the standard to fix the date for compliance at 28 days – rather than to fix it by reference to “practical completion”.  By 28 days, the slab could be expected to have done almost all (90 – 95 per cent) if not all of its hardening.
  1. [669]
    In short: I found that the defendant’s contractual obligation, when it came to slab strength, was to construct a slab which was of a characteristic compressive strength of 32 MPa at 28 days after its pour.  That required the defendant not only to order an  appropriate concrete mix (as it did) but also test the slab at 28 days so as to ensure that it met that contractual obligation. 

Strength – was the characteristic compressive strength of the slab 32 MPa at 28 days or at practical completion?

  1. [670]
    Hestbay’s case as presented in its written submissions at [155] was that “the concrete did not meet the contractually required minimum compressive strength (32 MPa) at either 28 days after pouring, or at practical completion”.  
  2. [671]
    Practical completion of Stage 2 was achieved on 2 August 2016.
  3. [672]
    Dr Woolcock and Dr Khan resiled from their application of Appendix B of AS 3600 to determine the characteristic compressive strength of the Stage 2 slab in 2022, having regard to the Z11 document.  They both adopted the Z11 approach to its calculation.  
  4. [673]
    Dr Khan calculated its characteristic compressive strength in 2022 as 33 MPa.  Dr Woolcock calculated its characteristic strength in 2022 as 32.7 MPa.  
  5. [674]
    Mr Reid would not budge from his AS 3600 Appendix B approach to determining the characteristic compressive strength of the slab in 2022.  I accepted the evidence of Dr Woolcock and Dr Khan that such an approach was flawed and treated Mr Reid’s evidence about the “strength” of the concrete in 2022 as irrelevant.  
  6. [675]
    Because of the defendant’s failure to test the concrete as required, the plaintiff had no contemporaneous evidence of the Stage 2 slab’s characteristic compressive strength at 28 days.  The best its expert, Dr Woolcock, could do was to extrapolate back from the slab’s characteristic compressive strength in 2022 to determine its characteristic compressive strength at 28 days after its pour, assuming a certain per centage increase in strength over time.  
  7. [676]
    Dr Khan thought Dr Woolcock was “wrong” to take that approach.  Dr Khan was firm in his view that one could not justify a back calculation to 28-day strength.  
  8. [677]
    In Dr Khan’s opinion, any strength increase in the Stage 2 slab after 28 days would have been minimal because the slab had no access to “new” moisture/water.  
  9. [678]
    Mr Munn gave evidence that, in his experience, (modern) slabs ceased to strengthen after 90 days.[221] 
  10. [679]
    The plaintiff discussed the evidence about the per centage increase in concrete’s strength over time in its written submissions – focusing on evidence about the likely increase in concrete’s strength after 28 days.  The plaintiff submitted at [165] that I could find that “concrete strength increased between at least 5% to 10% over time which leads to the conclusion that the characteristic strength of the concrete was less than 32 MPa even assuming Dr Khan’s analysis of 33 MPa as at 2022”.  I took that to be a submission that I would find that the characteristic strength of the concrete was  less than 32 MPa at 28 days.  To so find required me to accept Dr Woolcock’s approach to this issue.  
  1. [680]
    The defendant submitted that Dr Woolcock’s adoption of 10 per cent lacked the hallmarks of expert opinion because it failed to investigate all of the other variables relevant to strength increase and referred to in Z11 as its reason for not prescribing a rate.  The defendant submitted that Dr Woolcock applied a generalisation which Z11 said ought not to be applied.  He looked at whatever numbers he could find, which were between about 5 and 30 per cent, and selected a rate he considered to be conservative.[222]
  2. [681]
    I found that Dr Woolcock applied his assumption of 10 per cent strength increase over time bluntly.  He failed to take into account that concrete needs access to moisture to harden and that the slab was in a dry environment.  Indeed, the document Dr Woolcock took his 10 per cent from related it to the 28 to 90-day period, when the slab could be expected to be using up the water in the cement mix.  
  3. [682]
    Dr Woolcock also failed to take into account any other variable which might have an impact on the rate of strength increase over time.  
  4. [683]
    I accepted Dr Khan’s evidence that the strength gain to concrete in an internal environment is notably inferior to that in an outdoor environment, where the slab has access to water or moisture and the hydration process may continue.  Mr Munn’s oral evidence on this point was to the same effect. 
  5. [684]
    I accepted, on the evidence, including the authoritative documents, that concrete in a dry environment would harden for at least 28 days after its pour; and would probably continue to harden, albeit at a much slower rate, from 28 to 90 days after its pour – although it might achieve 100 per cent of its design strength at 28 days.  Its strength gain after 90 days (in its dry environment) would be minimal.
  6. [685]
    Having regard to the expert evidence about how concrete hardened, and the strength of the Stage 2 slab in 2022, I found that it was more probable than not that while there was an increase in the Stage 2 slab’s strength of up to 10 per cent between day 28 to day 90 (as it used up its water), in its dry environment, the slab’s strength gain post 90-days was minimal (something in the order of 2 or 3 per cent)
  1. [686]
    I found that, given its strength in 2022 and having regard to the evidence – 
    1. It was more probable than not that the concrete was not quite at 32 MPa at the 28-day mark;  however
    2. it was more probable than not to have been at 32 MPa at the 90-day mark – having “used up” its water in that time.
  2. [687]
    Of course, the site was not ready for tenants at 28 days post the internal concrete’s pour.  It was not ready for tenants until, at the earliest, the date of practical completion: 2 August 2016.   
  3. [688]
    The slab was poured between 18 April 2016 and 18 May 2016.  Ninety-days after its last pour fell on about 16 August 2016 – that is about two weeks after practical completion.  
  4. [689]
    Thus, on the way in which the plaintiff framed its case, an issue for me was whether it was more probable than not that the slab was at 32 MPa on 2 August 2016 (practical completion) – two weeks before day 90.  But the plaintiff’s submissions said nothing about what I should find the slab’s characteristic compressive strength to be at practical completion.  At its highest, the plaintiff submitted that I ought to find that the concrete was understrength “in 2016” (at [181]).  
  5. [690]
    No expert gave an opinion about the strength of the slab at practical completion.  The only evidence relevant to this point before me was the evidence to the effect that the strengthening process was asymptotic, with the rate of strength increase decreasing over time.  
  6. [691]
    I was persuaded, on the balance of probabilities, that the slab was at 32 MPa by day 90.  Bearing in mind the asymptotic way in which concrete strengthened, I considered it more probable than not that the Stage 2 slab was of a characteristic compressive strength of 32 MPa at practical completion – that is, two weeks shy of 90 days.
  7. [692]
    In short: I was satisfied that it was more probable than not that the slab was not of a characteristic compressive strength of 32 MPa at 28 days, but it was at such a strength at practical completion.  Thus, any breach was inconsequential. 

Thickness 

  1. [693]
    Dr Woolcock was of the view that the slab was too thin (and the defendant was therefore in breach) because it was of a depth of less than 170 mm at 17 of the 68 sites at which it was tested.  
  2. [694]
    The defendant took two issues with Dr Woolcock’s approach.  The first was that the facts upon which his opinion was based were not before the court.  The second was in his “spot failures” approach.  
  3. [695]
    As to the first issue, the defendant made the point that, in offering his opinion on thickness, Dr Woolcock relied upon inter alia length measurements by Griffith University and Premier Concrete Testing (see [77] of his first report),[223] which were not in evidence.  Accordingly, the factual foundation for his opinion had not been proven, which affected its weight.
  4. [696]
    Dr Woolcock discussed this issue in his report as follows ([77]-[78]):

As-Built Slab Thickness: Recent core testing by Griffith University, Premier Concrete Testing and CMT Labs all measured the length of the cores to get an indication of the as-built slab thickness.  The specified thickness is 175 mm and as AS 3600 permits a 5 mm tolerance, the minimum required thickness is 170 mm.  The tests measure the length of the samples before testing and after trimming prior to being crushed.  The results are as follows: 

  • The Griffith University tests for Unit 12/13 took 10 core samples but appear to have only measured the depth of 3 cores before trimming them.  The three thicknesses are 170, 160, and 170 mm.
  • The core samples taken by Premier Concrete Testing show the average thickness of the Unit 10/11 concrete to be 177 mm with only 3 of the 10 cores being less than 170 mm thick.  Premier also took 6 cores from Unit 9 which have an average thickness of 181 mm with one core measuring an average 167.5 mm and another 170 mm.
  • CMT Labs took 36 samples and reported slab thickness as follows:

Unit 9: The slab thickness corresponding to the core lengths ranged from 163 mm to 195 mm in Unit 9 with an average thickness of 183 mm.

Unit 10/11: The slab thicknesses ranged from 158 mm to 208 mm in Units 10/11 with an average thickness of 181 mm and from 163 mm to 217 mm in the hardstand outside Unit 10/11 with an average of 175 mm.

Unit 12/13:  The slab thickness ranged from 167 mm to 205 mm in Unit 12/13 with an average thickness of 183 mm.

More detail of the CMT tests is presented in Section 3.8 … [At 3.8, Dr Woolcock included a table which contained the “CMT Core Test Summary” for Units 10 and 11.]  

In summary, of the 62 (= 10+10+6+36) cores taken, only 55 slab thickness were reported.  Of these 55 (= 3+10+6 + 26), 17 (+2+4+11) are shorter than 170 mm and as such, the slab thickness at these core locations was not compliant with the specified thickness of 175 mm less the 5 mm tolerance in AS 3600.  As a percentage, the 17 slab thicknesses less than 170 mm represent about 31% of the 55 slab thicknesses measured.   

  1. [697]
    Dr Woolcock made errors in this analysis, which he purported to “catch” in his second report.  
  2. [698]
    In his second report, Dr Woolcock acknowledged three errors: 
    1. The depths of the three cores measured by Griffith University were: 170, 160 and 160 mm (not 170, 160 and 170);
    2. CMT Labs took 49 – not 36 – samples.
    3. He should have focused on the interior slab only.
  3. [699]
    On his corrected figures, 17 of all of the 68 samples taken were under 170 mm – about 25 per cent.  Thirteen of the 62 samples taken from the interior slab were under 170 mm – about 21 per cent.  But Dr Woolcock appears to have made another error in (b).  On my analysis of CMT’s Core Test Summaries (which were before the court), CMT took 44 samples and excluded one (sample C-4488).  
  4. [700]
    If I remove from my consideration the results of testing by Griffith University and Premier Concrete Testing, the CMT test results for the interior slab show that 7 of the 43 samples taken were less than 170 mm – about 16 per cent.  
  5. [701]
    As to the second issue:  The contract required simply that the slab be of “175 mm”.
  6. [702]
    The plaintiff pleaded that the slab was required to have a thickness equal to or greater than 175 mm across its entire area, although the AS 3600 allowed for a tolerance of 5 mm, and the matter proceeded on the basis that it would be compliant (from the plaintiff’s point of view) if it were of a thickness of 170 mm in its entirety.  
  7. [703]
    The defendant submitted at [72] of its written submissions that there was “no sensible commercial interpretation of the contract that would strictly insist on all points of the internal slabs to be equal to or greater than 175 mm over each square inch”.
  8. [704]
    Thus, a question for me was how the contractual requirement that the slab be of 175 mm ought to be assessed.  Obviously, the plaintiff was relying upon its being too thin at certain spot locations to prove that the requirement had not been met.  
  9. [705]
    The defendant argued that the “spot breach” approach was (a) “unscientific”; (b) inconsistent with Dr Woolcock’s approach to the strength assessment; and (c) inconsistent with Dr Woolcock’s view that all engineering assessments should be the subject of a statistical analysis.[224]  
  10. [706]
    The defendant submitted that I ought to consider the slab’s average thickness, referring me to Clause 15.3.3 of the CCAA Guide, which states:

The thickness of the base shall be determined on the basis of the average of base thickness measurements made on cores not less than 100 mm in diameter taken from selected points.

  1. [707]
    While there was evidence of the depth of the core samples taken by CMT and Testcrete before me, none of those samples has a diameter of “not less than 100mm”.  Although there were no such cores, the defendant submitted that, regardless, I should consider average thickness to determine whether the specification had been met.  On that basis, the slab’s thickness exceeded 175 mm.
  1. [708]
    Further, the defendant submitted that, to be consistent in his approach, Dr Woolcock ought to have calculated the slab’s “characteristic” thickness (as he had done for its strength).  Calculating thickness on this basis could not be met with an objection that an average might be misleading.[225]
  2. [709]
    The defendant performed such a calculation – on the basis of the CMT and Testcrete results.  But I noted another error.  The length of C-4498 was 195 mm not 193 mm.  There may well have been more errors in the defendant’s calculations – but it was not my job to identify them.  On the defendant’s calculations (error or errors included), the characteristic thickness of the Stage 2 slab was 181 mm.  
  3. [710]
    Thus, on an average basis or on a characteristic basis, the thickness of the slab exceeded 175 mm.  
  4. [711]
    The plaintiff submitted that it was not appropriate to rely upon average or characteristic thickness in determining whether there had been a breach of the specification that the slab was to be 175 mm thick.  This was because the Australian  Standard provided for a 5 mm tolerance.  This position was consistent with Dr Woolcock’s response when he was challenged on his spot failure approach in crossexamination.  Dr Woolcock said that thickness at any point below (or presumably above) the 5 mm tolerance provided for by AS 3600 rendered the slab non-compliant.  Although he acknowledged that that might not result in structural deficiency because the slab might have been over-engineered (as it in fact was – the engineers had provided “a bit of a buffer”).[226]
  1. [712]
    Dr Woolcock’s justification of his spot failure approach on the basis of the tolerance provided for in the Australian Standard does not answer the question.  I accept that the slab would comply with its specification if it was of a thickness of 170 mm (rather than 175 mm) because of the permitted tolerance.  But the question is “On what basis is thickness to be evaluated?”.  
  2. [713]
    It will be recalled that the experts agreed in their joint report that the CCAA “Manual” was a reliable design document.  Dr Woolcock was not asked why he did not consider the average, as it recommended.  
  3. [714]
    Dr Woolcock appears to have overlooked the fact that the CCAA Guide acknowledges tolerances in its prescriptions of the way to determine compliance with thickness requirements (my emphasis):

15 CONSTRUCTION TOLERANCES

 15.1  General

  1. 15.1.1Following completion, the finished surfaces of the various sections of the pavement shall be tested for conformance to the grades, lines and levels shown in the drawings, and for surface flatness by the methods detailed hereunder.
  2. 15.1.2Additionally, determination of the base thickness may be carried out as detailed in 15.3.3.
  3. 15.1.3Construction with intent to use maximum tolerances shall not be permitted.  

COMMENTARY The tolerances permitted in level flatness and thickness are the normal deviations that may occur in pavement construction under good workmanship and supervision.  

…

 15.2  Standards to be achieved

…

15.2.4  Thickness Where the average thickness of a base, as determined in accordance with Clause 15.3.3, is within (…) mm of the thickness specified, the pavement shall be considered within the permissible thickness variation and satisfactory in thickness.

COMMENTARY AS 3600 specifies that the deviation from any cross-sectional dimension shall not exceed 1/200 times the

specified dimension or 5mm, whatever is the greater.  As such, 5 mm would be a reasonable tolerance.

  1. [715]
    Thus, as per 15.2.4, if the average thickness of the Stage 2 slab, calculated as per 15.3.3, is within 5 mm of the thickness specified – the slab is compliant.  In other words, slab thickness is to be tested by reference to its average thickness, properly calculated (on the basis of cores not less than 100 mm in diameter).  If average thickness is within the tolerance allowed, then the slab is compliant.
  2. [716]
    However, for 15.2.4 to apply, the slab must have been tested for thickness as per 15.3.3.  However, the cores were not, as required by 15.3.3 “not less than 100 mm in diameter” and that paragraph could not apply to determine their thickness.  The defendant encouraged me to make do with the average thickness based on the core samples which were taken.  On that approach, the slab was compliant for thickness.  
  3. [717]
    I found that I had to apply Section 15, of the CCAA Guide, and in particular, sections 15.2.4 and 15.3.3, to determine whether the slab met its thickness requirements.  Neither the experts nor I could do so because the cores taken were not of the right size.
  4. [718]
    Therefore, my preliminary position was that the plaintiff had failed to prove that the slab did not meet its thickness specification because there had been no determination of the thickness of the slab in accordance with 15.3.3 of the CCAA Guide and an inability, therefore, to apply 15.2.4 to determine compliance.  
  5. [719]
    My alternative position was that the best I could do was to “make do” with the cores available and, on that basis, the slab was compliant for thickness. 
  6. [720]
    In case I was wrong about my preliminary and my alternative position – I went on to consider whether any lack of thickness, by way of spot failures, rendered the slab unfit for its purpose (see below, under Issue 5).  

Slump

  1. [721]
    The defendant accepted that if I were to find that the AS contract applied – as I did – then ordering slump of 100 mm contravened it, because that contract required One Sector to construct the slab in accordance with its specifications and design.[227]
  2. [722]
    Thus, the slab did not comply with the contractual requirements for its slump. 

Water to cement ratio of not greater than 0.65

  1. [723]
    As Dr Khan explained (and consistent with common sense), if one did not know the amount of water in the cement mix (or the water to cement ratio of the mix when it left the supplier) then one could not say what effect the addition of “excess” water had upon that ratio – no matter how much excess water was added.
  2. [724]
    There was no evidence before me about the water to cement ratio of the Stage 2 mix when it left the supplier.  Thus, the evidence did not allow me to make a finding about whether the slab met the contractual requirements for its water to cement ratio or not. Therefore, the plaintiff was unable to prove that the slab did not comply with the water to cement ratio required.

Issue 5:  If so, were those breaches the effective cause of the [plaintiff’s] loss and damage, or were the defective durability and strength problems caused by the tenants using non-pneumatic tyres on the flooring?

My re-framing: (a) Was the addition of uncontrolled water an effective cause of damage to the slab? 

(b) Did the thickness of the slab render it unfit for purpose?

  1. [725]
    My findings on (a) and (b) depended upon the evidence of the experts as analysed by me under the heading “Expert Evidence”; and took into account inter alia my observations about it as set out under Issue 4. 

Was the addition of uncontrolled water an effective cause of damage to the slab?

  1. [726]
    Hestbay submitted that, to succeed on causation, it did not have to show that one or more of One Sector’s breaches were the cause of its loss and damage. It was enough if one (or more) was an effective cause, even if there were other contributing causes – such as the tenants’ use of hard-wheeled vehicles. In this context, the plaintiff referred me to McGhee v National Coal Board[228]  and Alexander v Cambridge Credit Corp Ltd.[229]
  1. [727]
    Causation is a question of fact. The plaintiff must show, as a matter of common sense, and on the balance of probabilities, that a proven breach was a cause of the loss and damage it sustained. The breach need not be the exclusive or dominant cause of the loss complained of. The question is whether it materially contributed to the harm suffered.  
  2. [728]
    Bearing in mind that the “competing” cause of the loss and damage was the tenants’ use of hard-wheeled vehicles, Hestbay submitted as follows in writing at [140] (my emphasis):

The predominant or sole cause of the breakdown in the internal concrete slab surface was the uncontrolled addition of water.  But for that causing the weakness in the strength of the surface of the concrete slabs, the use of (non-pneumatic) solid tyred forklifts may have contributed to only some small amount of the dusting and abrasion of the concrete slabs in Stage 2 as is evidenced by the results of the performance of the Stage 1 slabs, which are burdened by a not dissimilar use in circumstances where they were to be constructed to 32 MPa strength.

  1. [729]
    The way in which the plaintiff made this argument reflected its misunderstanding about what had to be proven by admissible evidence about the Stage 1 slab before its better performance could be used in support of Hestbay’s claim.  It was not enough to prove the Stage 1 slab’s specifications – including that it was supposed to be constructed to 32 MPa strength.  I had to know how it was in fact constructed before I could proceed on the basis that the only difference between the slabs was that a  volume of uncontrolled water was added to the Stage 2 slab but not to the Stage 1 slab.  
  1. [730]
    Further, on the evidence, and accepted by the parties, the slabs were differently reinforced and the plaintiff’s own expert thought that that might have explained the better abrasion resistance of the Stage 1 slab.  
  2. [731]
    In other words, even if it were valid to compare the performance of the Stage 1 slab on the basis of its specifications with the performance of the Stage 2 slab on the basis of the way in which it was actually constructed (which it was not), the explanation for the better performance of the Stage 1 slab could well have been its Helix Fibre Reinforcement.  Further, I found that a densifier was not applied to the slab in Stage 2. If it had been applied to the Stage 1 slab, that too might have explained its better performance, but this was not explored in evidence.
  3. [732]
    The crucial point is that the plaintiff’s arguments which were based on comparisons made by Dr Woolcock between the Stage 1 and Stage 2 slabs in paragraphs [197][202] of its written submissions were rendered irrelevant because there was no admissible evidence of the assumptions which underpinned Dr Woolcock’s opinion.  An example of such an irrelevant argument is at [200]:

Mr Reid opines that the surface abrasion at dowel joints is occurring where an epoxy floor coating has not been applied which are (sic) minor superficial surface related maintenance issue and surface edge cracking is cause by the vehicles (sic) of hard wheeled vehicles traversing a minor shrinkage crack.  Such an opinion must be doubted where the comparison photos of Stage 1, in which hard wheeled vehicles are not dissimilarly being used demonstrate nowhere near the level of surface deterioration as is evident in Stage 2.  This comparison is precisely the reason why Dr Woolcock concludes that the use of hard wheeled vehicles is a mere possible contributor. 

  1. [733]
    For the reasons which follow, (which include an elaboration upon the point just made) I was not satisfied that it was more probable than not that the addition of uncontrolled water to the Stage 2 slab at pour was an effective cause of the damage to the slab.  
  2. [734]
    Without question, the water added on-site by One Sector, in the face of the “CAUTION” on the docket, was in breach of, or contrary to, the engineers’ requirements and the concrete supplier’s terms of sale.  And without question, the concrete supplied to the site was not tested as required by the engineers and Australian Standards.  In that sense, the addition of water to the cement mix on site was “uncontrolled”. 
  1. [735]
    In Dr Woolcock’s opinion, the uncontrolled addition of water on site not only weakened the concrete but also caused bleeding of the excess water, which brought fines to the surface.  Yet Dr Woolcock saw no such evidence of bleeding or surface fines in the cores taken by CMT.  Nor did Dr Khan in the Testcrete cores he examined.
  2. [736]
    I accepted Dr Khan and Mr Reid’s evidence that, within limits, the addition of uncontrolled water may not have a substantial effect on concrete’s strength or other properties. But they were inconsistent about the way in which the limit was to be measured. Dr Khan spoke in terms of the volume of uncontrolled water added as a per centage of the total water in the concrete mix (which was unknown). Mr Reid spoke in terms of the volume of uncontrolled water added as a per centage of the volume of the load of cement mix/concrete, which was consistent with the Holcim’s “10 litres per cubic metre” benchmark.  
  3. [737]
    Notwithstanding the Holcim benchmark, Mr Reid and Mr Munn did not consider 10 litres per cubic metre to be significant. Mr Reid’s evidence (corrected) established that in excess of 10 litres of water per cubic metre of concrete had been added to only 9 of the 204 truckloads of cement mix.  He found no evidence to suggest that the water added to those 9 loads reduced the strength of the concrete below 32 MPa.  
  4. [738]
    In my view, the plaintiff’s case, that the addition of 10 litres per cubic metre of concrete would have had a significant impact on the strength of the Stage 2 slab did not rise above the theoretical.  The plaintiff could point to nothing which demonstrated its impact on strength other than its flawed comparison with the Stage 1 slab.  
  5. [739]
    Dr Woolcock said that there was evidence of dusting but included no photographic evidence of it in his report.  
  6. [740]
    I could only find one photograph which was said by the plaintiff to show dusting.[230] But there was no evidence from any expert about the photograph and I did not know what to make of it, other than that it depicted a shoeprint in what seemed like dust in the corner of one of the units. That did not tell me much. I needed more details to meaningfully interpret the photograph, such as – assuming it did show concrete dust – how long it had been between the last time that corner had been swept or vacuumed and the taking of the photograph.  And of course, it was just one photograph.  
  7. [741]
    Dr Woolcock stated in the joint report that “the evidence” of dusting was “the need for frequent ride-on vacuuming in Units 10 and 11”. That was it. With respect, that was weak evidence which I did not find persuasive given Mr Rex’s evidence that he considered the dust to be in the nature of the business and bearing in mind the need for businesses to engage in cleaning regardless.  
  8. [742]
    To further complicate things, there was evidence from Ms Vandepol that her exterior slabs were powdery and dusting too – yet in 2022, they were as strong as 60+ MPa.  
  9. [743]
    According to AS 3600, a slab had to be of 32 MPa to tolerate even pneumatically tyred vehicles.  Most of the vehicles traversing the Stage 2 slab had hard wheels.  Yet the internal slab had sustained no significant damage which, in Dr Khan’s view, strongly suggested that the 28-day strength of the concrete was closer to 32 MPa – corroborated by the core sample tests, which revealed a mean compressive strength of 36.9 MPa and a characteristic strength of 33 MPa.  Mr Reid made a similar observation about the lack of damage.  
  10. [744]
    The experts accepted that the fact that One Sector ordered a concrete mix with a slump of 100 mm, rather than 80 mm, did not affect the slab’s ability to achieve a characteristic compressive strength of 32 MPa – Excel would have adjusted its mix  accordingly to ensure that whatever strength it targeted (which was likely stronger than 32 MPa) was achieved.  
  1. [745]
    Dr Woolcock’s oral evidence seemed to convey that any problem with the slab might in fact be a problem with its surface hardness, rather than its strength, and that was where the focus ought to have been. As he said, one could achieve 32 MPa but have a very soft surface because of the addition of water.  
  2. [746]
    The plaintiff argued that the uncontrolled addition of water caused the slab to “lack” its “required strength or surface hardness”. But the engineers’ drawings did not include a surface hardness or abrasion resistance requirement.  And there was no evidence which measured the slab’s surface hardness or abrasion resistance before me.  
  3. [747]
    The defendant made the same point. The defendant accused Dr Woolcock of “speculating” that the 100 mm slump might have contributed to the slab’s lessened abrasion resistance, referring to paragraph [139] of his first report, where he included the 100 mm slump as a factor which “may have contributed directly or indirectly” to the slab’s defects. The defendant observed that, while Dr Woolcock suggested that the 100 mm slump might have affected “surface hardness”, there had been no testing of the surface hardness of the slab.  And, as Dr Woolcock acknowledged, other factors contribute to surface hardness, such as curing, surface finishing techniques and compressive strength.  Thus, the defendant argued, I could not be satisfied that the 100 mm slump had any detrimental effect on the surface hardness of the concrete slab.  There was no objective evidence to support the contention that the slab had been overwatered: “Nothing in the cores. Nothing in the strength tests. Nothing whatsoever”.[231]
  4. [748]
    The plaintiff contended that Dr Woolcock had not speculated that the 100 mm slump may have contributed to the slab’s surface abrasion.  However: 
    1. The plaintiff’s argument in this regard (see below) reflected the plaintiff’s failure to appreciate the difference between the theoretical implications of a 100 mm rather than an 80 mm slump and what in fact happened to the slab the subject of these proceedings.  
    2. Its later submissions on the point (see below) reflected its flawed understanding of the value of any comparison between the slab in Stage 1 and the slab in Stage 2.
  1. [749]
    As to (a): I accept, as the plaintiff submitted, that authoritative materials enabled Dr Woolcock to say, as he did, that higher slumps can lead to excessive bleeding or a lack of surface hardness ([236]).[232] But Dr Woolcock pointed to no evidence of bleeding in the present case. Nor, as discussed, was surface hardness tested.  
  2. [750]
    I accepted Dr Woolcock’s evidence that a designer may specify a lower slump deliberately to achieve surface hardness, as was the case for aeroplane runways ([236]) – but there was no evidence about the Stage 2 slab designer’s actual intention.  
  3. [751]
    As to (b): The plaintiff submitted that there was “sufficient evidence available to draw an inference that [the slump of 100 mm] did have an adverse effect” [238] – but its argument relied upon the flawed comparison between Stages 1 and 2. It is worth setting out the plaintiff’s argument in full, to make the point (my emphasis):
  1. [238]
    Contrary to One Sector’s submission that the Court cannot be satisfied that the high slump had any detrimental effect on the surface hardness of the concrete slabs (noting that Hestbay’s case is that it was not slump alone but also the addition of water in an uncontrolled manner), there is sufficient evidence available to draw an inference that it did have an adverse effect.
  2. [239]
    As noted above, a comparison between the condition of the internal concrete slabs of Stage 1 and Stage 2 reveal that, although the concrete strength specified was identical (32 MPa) and tenants used non-pneumatic tyres, Stage 1 is not suffering from the same level of deterioration or dusting (if any).  The comparison is used by Dr Woolcock in his first report concluding that the use of non-pneumatic tyres was not the substantial cause of the surface deterioration. Notably, although armed with Dr Woolcock’s first report, none of One Sector’s experts sought to inspect nor inspected Stage 1 to compare the slab surfaces.
  3. [240]
    One Sector speculate (without basis) that Dr Woolcock assumed that no water should have been added to any load of concrete delivered to site.  This assumption is incorrect as Dr Woolcock’s first report clearly stated that water can be added on site if ordered by the supplier (Excel) and concrete samples taken to test and ensure the concrete mix (with added water) met the specifications..
  4. [241]
    Further, the submission that there is no evidence to show that the additional water had any effect on surface hardness is refuted by the very comparison between Stage 1 and Stage 2 relied upon by Dr Woolcock and not undertaken by One Sector’s experts.
  1. [752]
    As I have said, the plaintiff’s written submissions revealed the plaintiff’s failure to understand the critical need for proof of the facts upon which its expert’s opinions were based.  
  2. [753]
    An expert is entitled to provide their expert opinion on the basis of factual assumptions but their evidence is virtually worthless unless the assumptions are proven by admissible evidence. 
  3. [754]
    In this case, the requirement for proof of the assumed facts could not be satisfied by inviting me to draw an inference that the Stage 1 slab had been built to its specifications in the absence of evidence to the contrary produced by the defendant – which is where the plaintiff landed on this point. 
  4. [755]
    The notion embedded in the plaintiff’s written submissions, that it was for One Sector’s experts to refute the assumptions made by Dr Woolcock, was wrong.  The plaintiff made similarly wrong oral submissions.  The plaintiff submitted orally that it was “actually not up to the plaintiff to go about proving” that the Stage 1 slab had been built to specifications: it was for the defendant to prove to the contrary and if it did not, then I could “infer” that the assumptions were true.[233] With respect, that is not the law.  No burden shifted to the defendant to show that the Stage 1 slab had not been built to specifications to disprove the assumptions upon which Dr Woolcock relied – as the plaintiff insisted.  
  5. [756]
    The plaintiff had to ensure that the factual assumptions made by Dr Woolcock were proven by admissible evidence. That required evidence about the way in which the Stage 1 slab had actually been constructed and its strength (and surface hardness) at relevant times. That evidence could come from the plaintiff’s own case, the defendant’s case, or from material tendered by way of agreement (such as the documents in the Tender Bundle in this case).  But it was for the plaintiff to ensure that it was before me.  
  6. [757]
    The defendant could meet the plaintiff’s case in whatever way it chose, including by way of an argument that the factual foundation for Dr Woolcock’s opinion had not been proven by admissible evidence.  If that had been raised by the defendant at the beginning of the trial, I might have excluded a substantial part of Dr Woolcock’s report, and this trial would have looked very different.  But because there was no objection to it, I was entitled to give Dr Woolcock’s evidence the weight I thought it deserved.[234]
  7. [758]
    Dr Woolcock’s opinion that the predominant cause of the deficient slab was the uncontrolled addition of water was based on inter alia two assumptions, namely: 
    1. that the Stage 1 slab was in fact constructed to specifications (and no better than specified) and that no uncontrolled water was added to the Stage 1 slab during its pour; and 
    2. that the same type and quantity of reinforcement was used in each slab.  
  8. [759]
    Neither assumption was proved (indeed, (b) was disproved).  I therefore accorded Dr Woolcock’s opinion, to the extent that it was based on the comparison, no weight.  
  9. [760]
    Further, as to assumption (b), as I’ve said, Helix Fibre Reinforcement was in fact used in Stage 1 but not in Stage 2 in which “conventional” mesh reinforcement was used.
  10. [761]
    Dr Woolcock said that the Helix Fibre Reinforcement might possibly have improved the abrasion resistance of the Stage 1 slab. He said the difference in reinforcement gave rise to the “only doubt” he had about whether it was understrength concrete, rather than hard wheeled vehicles, which damaged the Stage 2 slab.  
  11. [762]
    In short, there was no factual foundation for the expert opinion upon which the plaintiff relied, and one of the assumptions upon which it was based was disproved.  There was no physical evidence of over-watering in the cores; or of the “adverse” effect of the slump.  There was no evidence about the water to cement ratio of the slab before or after its pour.  And no abrasion testing was done.  On all of the evidence, I was not satisfied that it was more probable than not that the uncontrolled addition of water was an effective cause of damage to the Stage 2 slab.  

Did the under-thickness of the slab render it unfit for purpose?

  1. [763]
    It will be recalled that Dr Woolcock found that the slab was thinner than 170 mm in 17 of the 68 locations from which cores were taken.  However, he performed no analysis of those results.  He simply relied upon the spot breaches to assert that the slab was non-compliant.  Dr Woolcock did not say whether or why the slab’s being under 170 mm at 17 of the 68 locations sampled would cause the slab to be unable to bear walls at any location.  
  2. [764]
    Mr Reid thought it reasonable to assess slab thickness generally relying on core samples, but they could not provide the basis for a definitive conclusion about the structural capacity of the slab because the samples taken represented such a small proportion of the total floor area (1/20,000th).  
  3. [765]
    The evidence established that the thickness specified by the engineers (175 mm, with a 5 mm tolerance, as per AS 3600) was more than enough to bear the wheel and post loads for which it was designed:  
    1. In Dr Woolcock’s opinion, 175 mm provided a “buffer”.  The slab only needed to be 167 mm thick for the engineers’ specified loadings.  
    2. Mr Reid considered the Westera requirement for a 175 mm slab to be conservative for the loading anticipated.  This was because fifty per cent of the slab was sitting on solid rock.  In Mr Reid’s opinion, the slab had to be 150 mm thick to accommodate the nominated loadings.
  4. [766]
    Additionally, in Mr Reid’s opinion, the slab’s thickness was sufficient to accommodate “any reasonable wall loading effects”. He said “reasonable” could be “anything”. He was not pressed further.  In his opinion, the evidence suggested nothing more than that “localised and non-representative undulations in the sub-grade preparation have given rise to inconsequential localised variations in thickness”.
  5. [767]
    The plaintiff submitted ([231]) that Dr Woolcock and Mr Reid’s loading calculations were largely irrelevant because its primary case was that “the 175 mm thickness was not simply for wheel and post loads, but also an integral part of not only the contractual bargain reached but also the fitness for purpose warranty which One Sector understood and represented to Hestbay would allow future tenants to move walls wherever they wanted within the internal footprint of the warehouses”.
  6. [768]
    The defendant acknowledged that the plaintiff opened its case on the basis that, because the slab was not 175 mm thick (across the whole slab), it could not be used as a base upon which to erect walls anywhere.  But this was an un-pleaded allegation and there was no evidence to support it.  The only evidence on this point came from Mr Reid, as above. 
  7. [769]
    I agree that there was no evidence that the slab could not support walls anywhere unless the slab was 175 mm thick (or 70 mm thick, allowing for the tolerance) everywhere.  The defendant observed in oral submissions that it was unsurprising that there was no evidence that the spot shortfalls meant that internal walls could not be constructed anywhere on the slab because a wall’s load is spread, and the slab’s average and characteristic thickness were well over 175 mm.  
  8. [770]
    In my respectful view, having regard to the size of the slab, and its average and characteristic thickness, the suggestion that the slab would be unable to support walls anywhere, because of spot thickness failures, does not accord with common sense.  
  9. [771]
    As the joint report reveals, Dr Woolcock and Mr Reid reached their conclusions about the necessary thickness of the slab for its intended loadings (not including walls) (167 mm and 150 mm respectively) via a formula into which they nominated values for certain variables.  
  10. [772]
    The plaintiff submitted in writing that Mr Reid made “errors” along the way to his conclusion that a slab of 150 mm thickness was sufficient, which are outlined in the footnote to this paragraph.[235]
  11. [773]
    The plaintiff submitted that I ought to prefer Dr Woolcock’s opinion in this regard because of Mr Reid’s errors.  
  12. [774]
    In Dr Woolcock’s opinion, the slab could not cater for its intended loading effects because 8 core samples were less than 167 mm.  
  13. [775]
    The defendant submitted that the differences in Dr Woolcock’s and Mr Reid’s selection of the values for the variables was a matter of professional judgment and I did not need to reach a conclusion about which approach I preferred.  The average and characteristic thickness of the slab was greater than 167 mm.  Even if I were to take the spot breach approach, allowing for a 5 mm tolerance, only two of the samples were less than 162 mm which, the defendant submitted, I ought to treat as de minimus.  And even if I were to consider spot shortfalls a breach, there was no evidence of any structural or adverse consequence of such a breach.  
  14. [776]
    Given the size of the slab, I preferred Mr Reid’s interpretation of the spot failures as representing nothing more than inconsequential localised variations in thickness.  
  15. [777]
    To sum up on the thickness issue:  
    1. I found that the spot failures represented nothing more than inconsequential variations in the slab’s thickness.  
    2. Thus, even if I should have found that –
    1. the slab was non-compliant because it fell below 175/170 mm at spot locations – 

there was no evidence that the spot failures meant that the slab could not support walls anywhere;

or

  1. the slab was non-compliant because it was below 167 mm at spot locations – 

there was no evidence that the spot failures identified meant that the slab could not bear the loads intended for it.

  1. [778]
    In other words, there was no evidence that, because the slab was not (a) 175 mm everywhere, or (b) 167 mm everywhere, it was unfit for its intended purposes of (a) being able to bear walls anywhere; or (b) being able to bear its nominated wheel and post loads.

Issue 6:  Whether rectification is required, and if so, which of the Options 1, 2 or 3 identified by Dr Woolcock are reasonable and necessary?

  1. [779]
    I dismissed the plaintiff’s claim because of my findings on Issues 1 – 5.  Therefore, I was not required to make a finding about the way in which the plaintiff was to be compensated.  However, I have attempted to deal with this issue in case it comes to matter somewhere else,[236] proceeding on the assumption that I was wrong in finding that Hestbay had not proven its claim and that it was entitled to damages.   I say “attempted to deal” because I found the exercise of calculating damages hypothetically very difficult because of the state of the evidence, including the evidence from Dr Woolcock about the effect of the lack of Helix Fibre Reinforcement in the Stage 2 slab.
  1. [780]
    Hestbay argued that – 
    1. It should be put back in the position it would have been in had One Sector complied with the contract and built a slab of 32 MPa at 28 days and of 175 mm thickness throughout.  
    2. Hestbay’s damages for One Sector’s defective building work were to be calculated either – 
  1. by reference to the “rectification loss” – the amount necessary to ensure the work conformed to the work contracted for; 

or

  1. to reflect the “diminution loss” – that is, the diminution in the value of property as the result of the defective building work.
  1. Hestbay preferred to be compensated by reference to its rectification loss, which included – 
    1. interim rectification works by way of installing a sealant to the trafficked parts of the slab in Units 12 and 13 and on all of the slab in Unit 9: $262,682.92.
    2. future rectification costs, estimated at – 

    either

    • $4,087,560.66 (including GST) for demolition and removal of the in-situ internal concrete slab and reinstatement of 40 MPa concrete;
    • $2,476,310.76 (including GST) for demolition and reinstatement to the engineers’ specifications (including a strength of 32 MPa and a thickness of 175 mm).

and

  1. the loss of rental income whilst rectification is taking place, and the cost of re-letting the land: $2,130,249. 
  1. [781]
    The evidence about the cost of rectification was not contested.
  2. [782]
    Alternatively, it claimed the diminution loss of either $6,820,000 or $4,980,000 (depending on the valuation methodology I accepted).
  3. [783]
    Hestbay acknowledged that the contract did not require a 40 MPa slab, but it argued that a slab of such strength was necessary to ensure that the warehouse was fit for purpose as a commercial warehouse for tenants of all kinds, including those who used hard-wheeled vehicles.  I have proceeded on the basis that the parties did not bargain for a 40 MPa slab, nor was it required by reference to the slab’s purpose.
  4. [784]
    Hestbay submitted that the rectification work proposed was reasonable and necessary in accordance Bellgrove v Eldridge,[237] that is, it was necessary to produce conformity and a reasonable course to adopt, bearing in mind that the test of reasonableness was only to be satisfied in fairly exceptional circumstances as per Tabcorp Holdings Ltd v Bowen Investments Pty Ltd.[238]
  5. [785]
    Hestbay acknowledged that, if demolition and reinstatement were considered unreasonable or unnecessary, then one might “limit remediation to the timely application of the Ucrete MF topping to increase surface hardness across the internal slabs”.  But it argued that this was an unreasonable option because the Ucrete supplier would not provide the usual 10-year warranty necessary because the slab was understrength and defective.  If I was to order that the slab be re-sealed, Hestbay submitted that it was appropriate to use a different (more expensive) sealant.  But still there would be ongoing costs for inspection and maintenance; and ongoing impacts or disruptions because of inspection and maintenance.
  6. [786]
    Hestbay submitted in writing (my emphasis):
  1. [279]
    Because of these factors [lack of warranties for a coating; ongoing costs for inspection and maintenance; ongoing disruption and difficulties associated with estimating their cost] the cost of rectifying the internal concrete slabs by demolishing and replacing to the original contractual standard is not out of all proportion to the benefit obtained and is required to produce conformity to the contractually required standard.  Hestbay is not securing an uncovenanted profit calling for rectification works necessary to place it in the contractually bargained position. .
  2. [230]
    Hestbay should be granted what it contracted for which reasonably and necessarily requires the grant of damages in the amount of the cost of demolishing and reinstating the internal concrete slabs to the original cost specification … in accordance with the scope identified by Mr Thompson..
  1. [787]
    Pausing here – I found it hard to conceptualise “the benefit obtained” from demolishing and rebuilding the slab to the contract’s specifications because (ignoring for the moment the complication around the Helix Fibre Reinforcement): (a) the existing slab was at least at its specified strength; and, while there were spot thickness failures, there was no evidence before me about the effect of those spot failures on the functionality of the slab.   
  1. [788]
    Alternatively, Hestbay urged me to assess its diminution loss in accordance with Ms Murdoch’s opinion rather than Mr Hurry’s because Mr Hurry – 
    1. did not factor in the rectification or remedial repairs which Mr Thompson considered necessary;
    2. did not factor in any discount because of the restriction on the use of the floors to pneumatic tyres only;
    3. was not aware of the benefits of non-pneumatic tyred forklifts in lifting heavy items up to high places;
    4. conceded that, if a prudent and willing buyer were aware of the defects in Mr Thompson’s report – then a contingency reduction in the value would be allowed. 
  1. [789]
    A difficulty I had with Hestbay’s claim for damages was that a demolition and rebuild to contract specifications – that is, to the specifications in the Tender Letter of 23 May 2015 – would mean rebuilding without Helix Fibre Reinforcement and without a densifier.  On the evidence, the absence of Helix Fibre Reinforcement was probably the reason why the Stage 2 slab was not performing as well as the Stage 1 slab.  And on the evidence, the densifier would have had a hardening effect as well.  There was therefore a real risk that demolishing and re-building as per the contract’s specifications would not improve the performance of the Stage 2 slab.
  2. [790]
    One Sector referred me to Stone v Chappel[239] in support of its argument that the rectification damages sought (to achieve a 40 MPa slab, to achieve a 32 MPa slab or coverage with a more expensive sealant) were unreasonable and expensive (paragraph [162] of its written outline).  It referred to the considerations applicable to the award of rectification damages articulated by Kourakis CJ at [55].  
  3. [791]
    One Sector submitted that its breaches were technical – that is, a breach because the slab was, at one point in time, less than 32 MPa, and because it was less than 170 mm at certain spots.  There was a “glaring disproportion” between the cost of rectification ($6.8 million +) and the contract price ($5.9 million +).  The reasonableness and necessity of the rectification sought by Hestbay did not survive a comparison with the application of chemical hardener, which would increase surface hardness by 10 to 25 per cent.  
  4. [792]
    One Sector made the following additional points – 
    1. It was not suggested that there had been structural damage.
    2. There is no evidence of any inadequacy in surface hardness.  
    3. Mr Rex, from Units 10 and 11, did not suggest that anything further needed to be done to his units. 
    4. Demolition and replacement with a slab of 40 MPa would be betterment.  A slab of that strength was not necessary for “general” warehouse use.
    5. Demolition and replacement with a slab of 32 MPa would achieve nothing different from the situation now/as it was in 2022.  
    6. There was no direct evidence that a “topping supplier” would not warrant its topping – given that the slab was now 32 MPa+ – although I note the hearsay evidence to that effect.  
    7. Applying a polyurethane/epoxy topping was betterment.  Mr Munn considered the topping which had been applied to Units 9 and 12 and 13 a “high strength, impermeable, abrasion resistant and serviceable floor coating” which upgraded the floor surface, allowing it to be traversed (without deterioration) by vehicles with solid tyres and steel wheels.  It therefore increased the strength of the wearing surface to a strength not contracted for. 
    8. Further, it was unnecessary.  Other cost-effective solutions, such as chemical hardeners, would improve the hardness and abrasion resistance and increase compressive strength at the surface by 10 – 25 per cent.  
  5. [793]
    One Sector submitted that the interim repairs were neither necessary nor reasonable.  Hestbay’s pleaded case was that it reasonably believed that it had a contingent liability to the tenants for loss and damage, which required it to carry out grinding and to apply Ucrete to Units 9 and 12 and 13.  But Mr Hutchins did not say how (or why) he was of this view.  None of the tenants alleged breaches of their leases.  It submitted that the remediation carried out by Hestbay amounted to an upgrade and was sufficient to address the issues without further work.  
  6. [794]
    As to whether there had been diminution in the value of the warehouse, the defendant pointed to the fact that all of the tenants extended their leases and one of the tenants (Budget Pet Products) took on another unit.  Ms Murdoch’s estimate of the diminution in value was based on the assumption that the extensive repairs in the quantity surveyor’s report were necessary.  There was no evidence that the design restriction to pneumatic tyres had any adverse impact on Hestbay’s ability to lease the units for the full market value.  Ms Murdoch was not asked about this.  Mr Hurry’s evidence was to the effect that it would make no difference to an incoming tenant.
  1. [795]
    In its written submission in reply, One Sector submitted on the law as follows (citations omitted):
  1. [39]
    Tabcorp did not find that Bellgrove v Eldridge was wrongly decided.
  2. [40]
    It is accepted that departure from the usual remedy of rectification costs is an exceptional course.  The expressions used in Tabcorp of “fairly exceptional” and quite exceptional” do no more than reinforce the primacy of the usual remedy.
  3. [41]
    It also needs to be kept in mind that the measurement of the loss stated in Bellgrove, as quoted with approval in Tabcorp was (emphasis added):

… her loss can, prima facie, be measured only by ascertaining the amount required to rectify the defects complained of and so give to her the equivalent of a building on her land which is substantially in accordance with the contract.

  1. [42]
    Also relevant in Bellgrove was the consideration that rectification might be awarded where the building, otherwise satisfactory, is “quite different in character” from that called for in the contract.  Both of the above concepts are captured within the concepts of ‘necessary’ and ‘reasonable course to adopt’.
  2. [43]
    As Kourakis CJ explained in Stone v Chappel, the Bellgrove qualification that rectification must be the reasonable course to adopt is calculated to control the level of damages and to address those cases in which the prima facie rule produces a result which is manifestly unjust.  Accordingly, the degree of departure from the contractual stipulation and adverse effect of the departure and relevant considerations, which encompass the ideas of de minimus, technical breaches and substantial performance.  
  3. [44]
    The disproportion between the cost of the rectification work and the contract price is at the core of the evaluative judgment that must be made.
  4. [45]
    Another matter that is clear from Bellgrove is that what remedial work is both ‘necessary’ and reasonable’ in any particular case is a question of fact.  
  1. [796]
    I considered Bellgrove, Tabcorp and Stone v Chappel in detail.  
  2. [797]
    If I had to award damages to the plaintiff, I would be influenced by the following considerations/findings– 
    1. The breaches complained of were relatively minor.  
    2. There was no evidence to support the suggestion that there was an issue with the slab’s surface hardness. 
    3. There was no evidence that spot failures in the thickness of the slab rendered it incapable of supporting walls in any location.
    4. The plaintiff did not bargain for a slab of 40 MPa.
    5. As soon as the slab was traversed by hard-wheeled vehicles, it was likely to be damaged because it was not engineered for them.  
    6. It would make no sense to demolish and re-built a slab of 32 MPa – that is what the plaintiff already has.
    7. The application of a surface hardener would harden the slab beyond its contracted-for strength.
    8. There was no evidence about the effect of a surface hardener (or an epoxy coating) on thickness.  Common sense would suggest that it would make no difference.  But the real point is that there was no evidence that the warehouse was less attractive to tenants because of the spot failures in thickness revealed by the evidence. 
    9. The Ucrete applied as a temporary solution amounted to betterment.
    10. An evaluation of the extent to which the uncontrolled addition of water contributed to the damage done to the slab was complicated by the fact that the Stage 2 slab was not reinforced with Helix Fibre Reinforcement; nor was a densifier specified for it.  
    11. Demolishing and rebuilding the Stage 2 slab to the 23 May 2015 Tender Letter’s specifications would mean no Helix Fibre Reinforcement and no densifier.  Thus, demolishing and then rebuilding a slab to the contract’s specifications might not improve the performance of the slab at all. 
  3. [798]
    At best for Hestbay, I would have awarded damages by reference to the cost of applying a surface hardener to the whole of the Stage 2 slab, thus rendering it of at least the strength contracted for.  I would also take into account any losses to the tenants (which they would seek to recover from Hestbay) as a consequence of the interruption to their businesses while the hardener was applied.  

Counterclaim

  1. [799]
    One Sector counter claimed in relation to payments it made for: (a) Qleave, (b) piling and piering, and (c) the extra height of the western rock boundary wall.  It first made these claims to Hestbay in 2022 and only claimed interest thereupon from that point in time. 
  2. [800]
    I have considered the counterclaim on the basis of my finding that the AS contract applied to Stage 2.  
  3. [801]
    For the reasons which follow, I found that the amounts claimed in (a) and (b) are payable by Hestbay.  I will leave it to the parties to calculate the relevant quantum, including the margins (10 per cent) and interest. 
  4. [802]
    One Sector claimed for these three items as variations by way of an undated letter, received by Hestbay on 21 June 2022.[240] Hestbay denied the claims in correspondence dated 23 June 2022.[241]
  5. [803]
    One Sector was well out of the time provided for variations in clause 36.5 of the AS contract.  Clause 36.5 read:

Clause 36.5 – Contractor to Notify

The Contractor shall, within ten (10) business days of the Contractor: (a) becoming aware of a variation; or (b) that it should have reasonably been aware of such Contractor (sic):[242]

Notify the Superintendent in writing of such variation.  For variations for additional WUC, the Contractor has a further ten (10) business days from submission of the notice to submit a cost for the variation, in accordance with this Clause 36.6.[243] If the Contractor fails to notify the Superintendent within the time periods permitted, the Contractor acknowledges and agrees that it waives all its rights or interests to any future claims as to additional costs, expenses or adjustments to the Contract Sum in favour of the Contractor.

  1. [804]
    By the time of the hearing, One Sector submitted that its claims for Qleave and piling and piering were not variations under the AS contract and were payable by Hestbay from the outset.  
  2. [805]
    Hestbay submitted that it was “not open for One Sector to assert that any cost which was excluded from the scope of the tender letter was ‘payable from the outset’”.  This was because “[n]ot one express term is asserted by One Sector in assisting its submission that where an item of work or cost was excluded from the contract price it was payable from the outset.  This is because no terms can be called in aid thereof”.  
  3. [806]
    One Sector submitted that the rock wall claim, was either: (i) an agreed addition to the Contract Sum; or (ii) “a variation deemed under the Contract”.   
  4. [807]
    As to (ii), One Sector submitted that clause 41.2 of the AS contract removed the time bar in clause 36.5, leaving it entitled to bring the claim out of time.  
  5. [808]
    Clause 41 in full states: 

41 Notification of claims

41.1 Communication of claims

The prescribed notice is a written notice of the general basis and quantum of the claim.

As soon as practicable after a party becomes aware of any claim in connection with the subject matter of the Contract, that party shall give to the other party and to the Superintendent the prescribed notice or a notice of dispute under subclause 42.1.

This subclause and subclause 41.3 shall not apply to any claim, including a claim for payment (except for claims which would, other than for this subclause, have been included in the final payment claim), the communication of which is required by another provision of the Contract.  

41.2 Liability for failure to communicate

The failure of a party to comply with the provisions of subclause 41.1 or to communicate a claim in accordance with the relevant provision of the Contract shall, inter alia, entitle the other party to damages for breach of the Contract but shall neither bar nor invalidate the claim.  

41.3 Superintendent’s decision

If within 28 days of giving the prescribed notice the party giving it does not notify the other party and the Superintendent of particulars of the claim, the prescribed notice shall be deemed to be the claim.

Within 56 days of receipt of the prescribed notice the Superintendent shall assess the claim and notify the parties in writing of the decision.  Unless a party, within a further 28 days of such notification gives a notice of dispute under subclause 42.1 which includes such decision, the Superintendent shall certify the amount of that assessment to be moneys then due and payable.  

  1. [809]
    Hestbay submitted that clause 36.5 took precedence over clause 41.2 because of its specificity. 
  2. [810]
    One Sector submitted that because the clauses were in conflict, I ought to “ditch” both of them and take a “synthesis” view.[244] 
  3. [811]
    I found that a plain reading of clause 41.2 removed the time bar contained in clause 36.5 (and all other time bars in the contract).  
  4. [812]
    While that was to Hestbay’s disadvantage, the pro-forma AS contract anticipated that the parties might wish to amend it (obviously on the assumption that they read it): see  Part E of the Annexure to the AS contract which makes provisions for amendments and deletions.  In other words, it would have been open to the parties to amend clause 41.2 to ensure Hestbay was not disadvantaged by the removal of the time bar, but they did not do so.  
  1. [813]
    It followed that, even if each of One Sector’s claims were properly characterised as variation claims, One Sector was not prevented from bringing them “out of time”. 

Inconsistent contractual terms 

  1. [814]
    A preliminary issue for claims (a) and (b), not adverted to by the parties, concerned contractual inconsistencies about the items excluded from the contract price.
  2. [815]
    I found that the contract which applied to the design and construction of Stage 2 was, in effect, a compilation of documents which included the AS contract and its annexures as well as the Tender Letter dated 23 May 2015.[245]  
  3. [816]
    The Tender Letter of 23 May 2015 (and those which replaced it) contained, at the end, a list of 17 “Items not included”. That list included Qleave – which was said to be “paid for by owner” – and “Piling or Piering”.
  4. [817]
    Annexure F of the Stage 2 AS contract listed 14 “General Exclusions” at 21.   
  5. [818]
    The exclusions listed in the Tender Letter differed from the exclusions listed in Annexure F.  Qleave and piling and piering were not included in Annexure F’s list.[246]
  1. [819]
    Thus, the contract governing Stage 2 contained inconsistent written terms about what was included in its price.
  2. [820]
    As discussed above under the heading “The Stage 2 contract”, I found that the AS 4902 terms applied only to the extent to which they were not inconsistent with terms expressly agreed between the parties, which included the terms of the Tender Letter.  Thus, I found that the Tender Letter’s exclusions applied. 

Qleave

  1. [821]
    By s 74(e) of the Building and Construction Industry (Portable Long Service Leave) Act 1991, Hestbay was required to pay a levy to fund long service leave payments for construction workers.
  2. [822]
    On 2 December 2015, Mr Ray arranged for the payment of Qleave “on Hestbay’s behalf”.  
  3. [823]
    Mr Garland from One Sector created a variation approval document for the QLeave payment on 2 December 2015.  An unsigned copy of the variation approval for Qleave is included in the Tender Bundle.[247] I note that the Qleave variation was included in the Variation Register dated 1 July 2016.[248] However, Mr Ray did not seek approval for the Qleave “variation” until June 2022.[249] He did not seek payment of it until June 2022.  
  4. [824]
    Hestbay argued that the claim for Qleave was a claim for a variation which One Sector could not make because it did not comply with the clauses of the AS contract which concerned variations.  My interpretation of clause 41.2 deals with that argument.
  5. [825]
    Hestbay pleaded that there was no express agreement that the plaintiff would pay the defendant the reasonable cost of Qleave, in addition to the contract price, and that their contract ought to be interpreted as including the cost of Qleave in the contract price.  This argument ignores the fact that the Tender Letter itself was included as part of the contract.
  6. [826]
    One Sector argued that: 
    1. One Sector’s Tender Letter contained an express contractual term to the effect that Hestbay would pay Qleave, as Hestbay was obliged to do under the legislation.  
    2. As soon as One Sector paid the Qleave levy for Hestbay, a debt arose in its favour.  
    3. And, in relation to that debt, One Sector only claimed interest from the point in time at which it made its claim to Hestbay.  
  7. [827]
    In my view, the only reasonable way to interpret the list of “Items not Included” which immediately followed the statement of the “Turn Key Price for Stage 2” was that their cost would be something additional to the contract price, and payable by Hestbay – even if there were no express term to that effect. 
  8. [828]
    I found that Hestbay owes One Sector for the Qleave payment One Sector made on its behalf.  

Piling and piering

  1. [829]
    One Sector referred to Mr Ray’s evidence about why piling and piering was excluded from the contract by the Tender Letter at [160] of his affidavit, but I understood that paragraph to have been excluded by agreement from the evidence.[250]
  2. [830]
    One Sector argued that piling and piering was not a variation because it did not represent a change to the nature or scope of the building work to be carried out.  The extent of piering had been specified by Westera Partners in the Engineering Drawings and was not altered during the build.  Thus, it submitted, the variation methodologies were inapplicable.  Even if it were a variation, One Sector was not disentitled from making the claim because of clause 41.2.  As above, I agree on that point.
  3. [831]
    In addition to its variation argument in response to this claim, Hestbay pleaded that the Tender Letters “did not provide an express agreement that the plaintiff would pay the defendant as an addition to the contract price the reasonable cost of … piling and piering works”.  
  4. [832]
    As above, in my view, the only reasonable way to interpret the list of “Items not Included” was that their cost would be something additional to the contract price, and payable by Hestbay.
  5. [833]
    I acknowledge that not all of the excluded items were payable by Hestbay to One Sector, such as, for example, GST or council fees.  I acknowledge that the quotes for some of the excluded items could vary widely.  And I acknowledge that, in the case of excluded work to be done by One Sector, the contract provided no mechanism for the determination of their cost.  But I do not need to be troubled by that issue in this case, because the experts agreed upon a reasonable price for piling and piering.  
  6. [834]
    I found that Hestbay owes One Sector for the cost of piling and piering. 

The rock wall

  1. [835]
    With respect to the Stage 2 rock wall: One Sector made an allowance for it of $120,000, as communicated to Mr Hutchins in June 2015.  
  2. [836]
    One Sector engaged Australian Rock Walls (ARW) to do the rock wall work on 13 August 2015 for $110,910.  
  3. [837]
    ARW sent One Sector two invoices for the work.  One on 28 August 2015 for $66,403.32; and another on 16 September 2015 for $55,087.37 – a total of $121,490.69.  
  4. [838]
    The rock wall had been built by 16 September 2015 and One Sector was aware of its cost (including the preparation costs) by that date.  
  5. [839]
    One Sector pleaded that, as per the Tender Letters of 17 and 14 March 2016, the maximum height of the rock allowed for in the contract price was four metres and the price was not inclusive of the height increase arising from the plaintiff’s variation direction in 2015.
  6. [840]
    Its particulars referred to the clarification in the Tender Letters that the price included “Retaining required prior to design Western Boundary 4 m High”.
  7. [841]
    The Tender Letter dated 23 May 2015 – sent on 10 July 2015 by Mr Ray to Mr Hutchins as part of the Stage 2 contract documents – said under the heading “Clarifications”, in red type:

Please see attached list of contract variations for stage 1 we offer to absorb for the opportunity to move ahead on stage 2.

  1. [842]
    There was no list “attached” in a separate document.  
  2. [843]
    The Tender Letters dated 14 March 2016 and 17 March 2016 included the same clarification – but it is not in red type.  Nor is a list attached.  It also included, under the clarification heading, the following statement about the wall:

This price includes Retaining required prior to design Western Boundary 4 m High.

  1. [844]
    One Sector referred to correspondence revealing inter alia the architect’s decision about an increase in wall height (as per his revised drawings); Mr Ray sending Mr Hutchins the revised drawings on 6 and 25 August 2015; and Mr Hutchins “confirming the further revised site drawings by email to Mr Ray on 25 August 2015”. 
  1. [845]
    One Sector argued that the statement in the Tender Letter about the rock wall ought to be interpreted as meaning that the cost of anything in excess of four metres was to be recovered.  
  2. [846]
    Hestbay argued that the height of the rock wall was not specified in the Tender Letter as 4 metres high – rather that was the estimate.  And One Sector was obliged to carry out that work as part of the lump sum fixed price contract.  Also, One Sector did not comply with the contractual requirements for variation claims.  It therefore did not accrue any right to payment of a debt under the contract for the variation.  Nor was there any agreement with Hestbay about the additional cost for the rock wall.  
  3. [847]
    Further, as Hestbay pointed out, One Sector allowed $120,000 in the contract’s price.[251]  The wall builder claimed a payment of $121,490.69.  One Sector paid the wall builder only $115,656,10, after a remeasure.  In other words, One Sector paid less than the amount it had allowed for the work in the contract price.
  4. [848]
    I found that the amount allowed for the rock wall in the contract price, based on an estimated height of 4 metres, was, fortuitously, sufficient to cover the price of the wall as actually built.  
  5. [849]
    I therefore dismissed this aspect of the counter claim.  

Appendix 1

Leases and Tenants

  1. Stage 1 was completed on 17 June 2015.  It included a warehouse of eight units, which were leased as follows – 

Unit #

Tenant

Lease dates

1 – 5 

Chempro 

Brad Markwell:  The units were used as a storage and distribution centre for pharmaceutical supplies.

1  February 2016 – 1 February 2028; with 2 x 5- year options

6 – 8

Viadux 

Karen Doblo:  Viadux distributed civil, plumbing and building goods.  The units were used as a storage and distribution centre.  Products were supplied in bulk, palletised form.  Orders were picked, packed, and despatched to clients, including on pallets and in boxes. 

29 September 2015 – 22 February 2024; with 2 x 3- year options.

  1. Stage 2’s construction commenced in early 2016 and was completed on 2 August 2016.  It included a warehouse of five units and an office.  Its unit numbers were 9, 9A (the office), 10, 11, 12 and 13 which were leased as follows

–  

Unit #

Tenant

Lease dates

9

TNT:  The units were used as an undercover transit and freight centre.  

1 March 2018 – 1 March 2021

9[252]

Budget Pet Products 

Carla Vandepol:  The units were used as a warehouse and distribution centre for pet and veterinary products. 

1 March 2021, for a term of 3 years, with an option for a further term of 5 years.

10 – 11

EZFurn 

Trevor Rex: EZFurn is a wholesale commercial furniture supplier, which used the units for the warehousing and light assembly of furniture, and as a distribution centre.

1 August 2018 – 31 July 2026

Appendix 2 

Vehicles in use

  1. Stage 1 tenants – 

Unit #

Tenant 

Machinery and equipment

1 – 5 

Chempro

.

Counterbalance gas powered forklift with solid rubber tyres.  Used to load and unload trucks and to move stock in and around the warehouse onto the racks.

2.5 T electric forklift with solid rubber tyres – free-standing weight of 1,470 kgs and a full load weight of 3,498 kgs.  Used to load and unload trucks and to move stock in and around the warehouse onto the racks.

1.6 T electric forklift with solid rubber tyres – free-standing weight of 1.020 kgs and a full load weight of 4.185 kgs.  Used to load and unload trucks and to move stock in and around the warehouse onto the racks.

4.5 T electric forklift with solid rubber tyres – free-standing weight of 2.040 kgs and a full load weight of 4,805 kgs.  Used to load and unload trucks and to move stock in and around the warehouse onto the racks.

6 x pallet jacks with solid rubber tyres – free-standing weight of 70 kgs each and a full load weight of 2,300 kgs.  Used to move stock in and around the warehouse.

As at 12 October 2022, Chempro continued to operate the 1.6 T forklift, the 2.5 T forklift; the 4.5 T forklift and the pallet jacks.

It ceased operation of the gas-powered forklift in early/mid 2016.  

6 – 8

Viadux: 

Gas powered forklift with solid tyres[253] – free-standing weight of 1,840 kgs and a full load weight of 4,350 kgs.  Used to load and unload pipes and pallets in the load bays.

Battery powered forklift with solid tyres – free-standing weight of 1,400 kgs and a full load weight of 2,480 kgs.  Used to lift and move pallets within the warehouse and loading bays.

Battery powered forklift with solid tyres – free-standing weight of 1,600 kgs and a full load weight of 3,094 kgs.  

2 x battery powered forklifts with solid tyres – free-standing weight of 1,600 kgs and a full load weight of 2,874 kgs.  Used to lift and move pallets within the warehouse and loading bays.  

  1. Stage 2 tenants – 

Unit #

Tenant

Machinery and equipment

9

TNT

Ride-on forklift to unload and load trucks. 

Stand-up, ride-on, forklift to lift storage pallets and products onto racking.  

9

Budget Pet

Products: 

3 x battery powered Order Pickers, with Vulkollan tyres – free-standing weight of 1,770 kgs and a full load weight of 2,770 kgs.  Used to pick products from the bottom two levels of racking.

From 21 September 2021, another order picker (as above).

From 29 June 2022, an LPG powered. material handling forklift, with pneumatic tyres – free-standing weight of 3,560 kgs and a full load weight of 6,060 kgs.  Used to load/unload trucks of pallets or parcel cages.

10 – 11

EZFurn:

Trevor Rex

Forklift truck – with non-pneumatic tyres – free-standing weight of 3,560 kgs and a lift capacity of 2,500.  In use for three hours per day.

Order picker with non-pneumatic tyres – free-standing weight of 3,700 kgs and a lift capacity of 972 kgs.  In use for approximately 14 hours per week.

(from February 2019) Narrow Aisle Forklift with non-pneumatic tyres – free-standing weight of 6,500 kgs and a lift capacity of 1,500 kgs.  In use for approximately 24 hours per week.

(I note that according to Mr Ray, EZFurn operated 2 – 3 – 4 forklifts, with non-pneumatic tyres.  This is an over-estimate.) trolleys and 3

12 – 13

Budget Pet

Products 

[All tyres non-pneumatic.] 

Petrol and LPG powered forklift with super-elastic tyres – freestanding weight of 3,160 kgs and a full load weight of 5,660 kgs.  Used to load and unload trucks of pallets or parcel cages.

2 x battery powered, work assist vehicles with polyurethane tyres – free-standing weight of 590 kgs and a full load weight of 930 kgs.  Used to enable a picker to operate in confined spaces.  Used where small loads are handled at height.

On 12 May 2020, Budget Pet Products ceased operation of the work assist vehicles at Units 12 and 13.

Added on 30 November 2017:  battery powered High Reach Forklift with super elastic tyres – free-standing weight of 3.410 kgs and a full load weight of 4,810 kgs.  Used to load and unload pallets onto/from  racking.

Added on 15 December 2017:  battery powered order picker with polyurethane tyres – free-standing weight of 1,264 kgs and a full load weight of 1,964 kgs.  Used to transport small loads around the warehouse.

Added on 1 June 2018: 2 x work assist vehicles with polyurethane tyres – free-standing weight of 645 kgs and a full load weight of 985 kgs.  

Added mid to late 2018:  battery powered work assist vehicle with polyurethane tyres – free-standing weight of 645 kgs and a full load weight of 985 kg.

Added on 8 July 2019:  battery powered high reach forklift with super elastic tyres – free-standing weight of 3,470 kgs and a full load weight of 5,070 kgs.

Added on 30 June 2020:  LPG powered material handling forklift with pneumatic tyres – free-standing weight of 3,560 kgs and a full load weight of 6,060 kgs.  Used to load/unload pallets onto/from racking.  

Added on 22 July 2021:  high reach forklift, which was battery powered and with Vulkollan tyres – free-standing weight of 2,591 kgs and full load weight of 4,190 kgs. 

Infrequently, the tenant operates an order picker (from unit 9) to move stock as required – free-standing weight 1,770 kgs and a full load weight of 2,770 kgs. 

Upon the commencement of the Unit 9 lease, the tenant ceased the operation of two of the work assist vehicles, the floor sweeper, a forklift, and a high lift forklift.

According to Mr Ray, in 2019: Budget Pet Products used 15 to 20 forklifts, with elastic or hard wheeled tyres; and trolleys with elastic or hard wheels.  This is an over-estimate.

Footnotes

[1] Hestbay Pty Ltd v One Sector Pty Ltd [2023] QSC 154.

[2]  The coating was applied to deal with the complaints of the Units 9 and 12 and 13 tenant – Budget Pet Products – about the slab.

[3]  There were differences in the specification of their reinforcement and the application of a densifier.

[4]  [2008] QCA 130 at [68]. See also the footnote to that paragraph; R v Gibson [2022] QCA 151 at [10]; Makita (Aust) Pty Ltd v Sprowles (2000) 52 NSWLR 705; and Sanrus Pty Ltd v Monto Coal 2 Pty Ltd(No 7) [2019] QSC 214 at [99].

[5]  T 8-18 – T 8-19.

[6]  Clause 1.7 ascribed meanings to the many symbols used in the standard, including “f’c” which stood for the characteristic compressive (cylinder) strength of concrete at 28 days

[7]  The distinction between production and project assessment is in AS 1379-2007.

[8]  Page 5359 of Part E.

[9]  In the 2018 version of the standard, B6.4.2 stated, “B6.4.2 Interpretation of results: The strength of the concrete in the member shall be estimated as either – (a) 1.15 times the average strength of the cores and beams; or (b) by using test data from cores or beams taken from another member for which the strength of the concrete is known.

[10]  Paragraph (c).

[11]  Pages 5770 – 5835 of Part E.

[12]  Page 5792 (1st column) of Part E.

[13]  Page 5829 of Part E.

[14]  Page 5933 of Part E.

[15]  Page 7.

[16]  Page 8.

[17]  T 5-17 lines 10-20. However, Mr Ray’s affidavit evidence was inconsistent on this point. In his affidavit of 18 May 2023, he said at [7], “There was no discussion of John Hutchins’ or the plaintiff’s industrial development experience, not on 3 September 2023, not ever.” In his affidavit of 7 March 2023 at [62] he said, “ … so far as I knew, John Hutchins had little to no experience with these types of contracts and was a new developer.” I preferred Mr Ray’s oral testimony and the position he took in his 7 March 2023 affidavit.

[18]  Which was arguably relevant to his understanding of the vehicles which might be used in the units.

[19]  Page 260 of Part C.

[20]  T 5-27.

[21]  Page 263, Part C.

[22]  Pages 332 – 334 of Part C.

[23]  Page 347 of Part C.

[24]  Pages 458A to 458PPP of Part C.

[25]  Pages 458RRR – 458UUU.

[26]  A kilonewton – which measures force.

[27]  See exhibit 2.

[28]  T 3-36, lines 1 – 5. In other evidence, it was explained that the engineer’s notes are construction instructions to the client, the builder and ultimately to the contractor through the builder: T 7-5.

[29]  Page 1784 of Part C.

[30]  “The Lessor shall advise and the Lessee shall observe the maximum floor loading weights for which the premises were designed”.

[31]  Page 1875ff of Part C.

[32]  In her oral evidence, Ms Doblo said that she had been given the information about the existing slabs and the location of the start of the Overlay by an engineer who had visited her warehouse to determine why the slab had started to crack.

[33] Cf emails and photographs at 2067ff and 2085ff of Part C.

[34]  Page 2086 of Part C.

[35]  Although on 14 January 2017, when Mr Willmott inspected units 10 and 11, he noted cracking.

[36]  See emails at Page 1970 of Part C.

[37]  Page 1970 of Part C.

[38]  Map cracking is fine cracking which has the appearance of a map.

[39]  Page 1969 of Part C.

[40]  T 6-12 lines 13 – 19.

[41]  Page 3455 of Part D – paragraph [09].

[42]  Page 1975ff of Part C.

[43]  Pages 1983 and 1984 of Part C.

[44]  Page 1979 of Part C. It seems that “joins” and “joints” are used interchangeably.

[45]  Page 2019 of Part C.

[46]  Page 2090 of Part C.

[47]  My understanding of the evidence was that the Ucrete was “a high performance trowelled on flooring system based on polyurethane cement technology” (page 2425 of Part C). But the witnesses referred to it as an Epoxy.

[48]  Page 2650 of Part C.

[49]  T 3-73 – T 3-74.

[50]  Dr Woolcock calculated an average strength of 53.5 MPa for the slab outside Units 12 and 13 on the basis of the cores. 53.5 x 1.15 = 61.525.

[51]  T 3-78 lines 16 – 21.

[52]  Exhibit 6.

[53]  T 3-45, lines 24-25.

[54]  Page 2519 of Part C.

[55]  Page 3966ff of Part D.

[56]  I note that Dr Woolcock attached to his report a letter from CMT, dated 26 July 2022, which dealt with the slab of Units 10 and 11 only. It stated that CMT visited the site on 22 June 2022 for an initial inspection of Units 10 and 11 and observed surface abrasion, wear, and various crack patterns, however, visibility of the slab was limited due to the pallet racking shelves, pallets, tables machinery et cetera (Page 3010 of Part D).

[57]  Page 4471 of Part D – paragraph 7.

[58]  Page 4471 of Part D.

[59]  Page 4475 of Part D. The Testcrete results are in Appendix 3 of Dr Khan’s first report (at Pages 4510 – 4525 of Part D)

[60]  2 August 2016.

[61]  Page 265 of Part C.

[62]  Pages 501 – 506 of Part C and Pages 511 – 516 of Part C.

[63]  Which was actually sent twice on 9 June 2015.

[64]  Page 540 – 642 of Part C.

[65]  Page 538 of Part C.

[66]  Page 539 of Part C.

[67]  Page 541 – 642 of Part C. I could not find the first version in the Tender Bundle.

[68]  See paragraph 7 of Part F which refers to “Additional scope clarification, provided by One Sector 23 May 2015”. Paragraph 8 sets out the detail of the Tender Letter dated 23 May 2015. It does not include the statement contained in the actual tender letter itself that One Sector’s standard terms and conditions applied: Pages 611 and 612 of Part C. The Tender Letter is at 616 – 621 of Part C.

[69]  Page 203 of Part C (Mr Ray’s affidavit).

[70]  Page 593 of Part C.

[71]  T 5-33 lines 31 – 35.

[72]  T 5-33 lines 42 – 44.

[73]  T 5-33, line 46 – T 5-34, line 47.

[74]  Page 643 of Part C.

[75]  Page 646 of Part C.

[76]  Page 669 of Part C

[77]  Page 650ff of Part C.

[78]  Page 659 and 657 of part C.

[79]  Page 650 of Part C.

[80]  Page 1221 ff of Part C.

[81]  Page 677ff of Part C.

[82]  Pages 682 – 683 of Part C.

[83]  Page 991 of Part C.

[84]  Page 990 of Part C.

[85]  T 5-41 line 4 – T 4-42 line 15.

[86]  Page 1081 of Part C.

[87]  Page 1242 of Part C.

[88]  Page 1250 of Part C.

[89]  Page 1272 of Part C.

[90]  Page 1273 of Part C.

[91]  Page 1758 of Part C.

[92]  Page 1758 of Part C.

[93]  Page 1824ff of Part C.

[94]  The evidence about the number of loads of cement delivered for the Stage 2 slab was inconsistent. Two sets of the dockets appear in the trial bundle. Duplicates are included in one set but not in the other. Colour copies of some dockets are included in one set but not in another. Some dockets are obviously missing.

[95]  T 5-46 – T 5-47.

[96]  The evidence about the number of delivery dockets/loads was inconsistent and inaccurate. As noted above, the material tendered included duplicate dockets, and some dockets were obviously missing. On my count, there were 51 dockets on which it was noted that water was added at the customer’s request.

[97]  T 5-55.

[98]  T 5-58, lines 32 – 45.

[99]  Mr Ray explained that having inspected the slab in late 2019/early 2020, he thought that a light grind and the application of a densifier would “sort the issue” and he proposed such a solution to Mr Hutchins, which did not proceed. Instead, Mr Hutchins arranged for certain areas of the Stage 2 slab to be covered with an epoxy. Pages 209 – 210 of Part A & B.

[100]  Such as the outcome of the application of B6.4.2 of AS 3600.

[101]  Page 2801ff of Part D.

[102]  Dr Woolcock had some reservations about the engineers’ specified water-cement ratio of 0.65, which he considered to be unnecessarily high, but he considered the Westera design suitable for the loading criteria listed on the drawings. At [56] of his report, he discussed what would “normally” be included in such a brief, such as the type of forklift and its wheels to be used on the slab.

[103]  T 4.43 lines 17 – 18.

[104]  In this report, Dr Woolcock in fact incorrectly proceeded on the basis that 55 core samples were taken, leading him to conclude that thirty-one per cent (17) of the cores measured for thickness were not as thick as required. In other words, 17 of the 55 were less than 170 mm thick (175 mm less the 5 mm tolerance permitted by AS 3600). However, in a later report, dated 6 July 2023, he corrected himself. Thickness was measured at 68, not 55, locations. The corrected opinion has been stated in this paragraph.

[105]  Page 2868 of Part C.

[106]  That is, on each docket.

[107]  Several errors in Dr Woolcock’s original table were detected during the hearing. Dr Woolcock amended his table after his evidence.

[108]  Dr Woolcock’s revised table omitted two dockets. They related to two other deliveries on 18 April 2016: one at 6.02 am and another at 8.38 am. No slump stand water was added to the 6.02 am delivery. Nor was any water added at the customer’s request to that delivery. Nor was a maximum amount of water per load specified. Twenty litres of slump stand water was added to the 8.38 am delivery. No water was added at the customer’s request to that delivery. Nor was a maximum amount of water per load specified.

[109]  For example, the docket for the earliest delivery on 18 April 2016 (docket number 61017086) shows a progressive total of 14.7 m3, which implies that there were one or two earlier deliveries for which there were no dockets. It also refers to a previous truck, which implies at least one earlier delivery. I note also that on every other day, the deliveries commenced at about 5.30 am, but the earliest delivery on 18 April 2016 was said to be at 6.23 am.

[110]  A building materials company.

[111]  Pages 3387 – 3389 of Part D.

[112]  Page 3385 of Part D.

[113]  Appendix E to the report, at Pages 4760 4762, although he appears to have unnecessarily calculated the litres of slump stand water added per cubic metre when no water was added at the customer’s request.

[114]  I concentrated on the larger volumes.

[115]  At [90] Dr Woolcock referred to a document published by Queensland Transport and Main Roads, “MRTS70” which set out the conditions under which water might be added to concrete (see page 2823 of Part D). I appreciate the reason for Dr Woolcock’s reference to this document – that is, to illustrate that Excel’s failing to state the maximum amount of water which might be added to a load on a docket was inconsistent with best practice for the competent supply of concrete. But I also note that one of the conditions for the permissible addition of water to the mix on site was that the amount of water added did not exceed 10 litres per cubic metre of mix – which was consistent with the Holcim document but which suggested that anything less than 10 litres per cubic metre was permissible. Having made that observation, I took care not to give much weight to this statement in MRTS70 because it was not canvassed in evidence.

[116]  T 4-50 lines 25 – 35.

[117]  CMT LABS Pty Ltd: which is NATA accredited for construction material testing. Its report is at 3088 – 3257 of Part D and 3966 – 4467 of Part D. The core strength reports are at 3977 – 3979 of Part D.

[118]  Applying a relevant correction factor which is required for reasons I need not go into, but which is well explained in the Concrete Institute of Australia’s Z11 document – see page 5779 of Part E.

[119]  I note that the apparently best performing Stage 2 slab – the slab in Units 10 and 11 – was of the lowest average corrected core strength in 2022.

[120]  Exhibit 5.

[121]  T 4-26 lines 13 – 15.

[122]  The significance of 90 days (after pour) was that that was when one might expect the slab to be first loaded.

[123]  Pages 2806 and 2806 of Part D.

[124]  This statement by Dr Woolcock implies that the exterior slab was properly constructed by One Sector. I note that it was poured sometime after the interior stab was laid, as the photographs of the pour taken by Mr Ray show (see pages 1696 – 1794).

[125]  T 4-17 – 4-20.

[126]  Page 2833 – 2834 of Part D.

[127]  Page 2802 of Part D.

[128]  Page 2803 of Part D.

[129]  Pages 4469 – 4525 of Part D.

[130]  T 6-5.

[131]  There was no evidence before me about “RILEM”

[132]  T 6-16.

[133]  Testcrete Concrete Testing – a NATA accredited business.

[134]  T 6-18.

[135]  Clause 8.1(4) of EN 13791 Assessment of in-situ compressive strength in structures and pre-cast concrete components (Pages 5836 to 5904 of Part E) provides a formula for the calculation of characteristic in-situ compressive strength, which relies upon the mean in-situ compressive strength (Page 5962 of Part E). My understanding is that no similar formula is available for concrete in Australia.

[136]  Dr Khan considered the Testcrete and CMT results. He applied AS 3600 and Z11. He reached the following conclusions:

  1. (a)
    The compressive strength of the cores tested by Testcrete ranged from 27.0 MPa to 36.5 MPa, with an average corrected core compressive strength of 32.1 MPa. That average, when converted to concrete strength in a member, applying AS 3600 Appendix B2 corresponded to a value of 36.9 MPa, which is 15% higher than the design strength of 32 MPa.
  1. (b)
    Applying Z11’s recommended practice and BS EN 13791, the core sample results met the 32 MPa concrete requirements.
  1. (c)
    Applying AS 3600 Appendix B to the CMT results to obtain values for concrete strength led to the following results:
  1. (i)
    37.03 MPa (Unit 9),
  1. (ii)
    36.45 MPa (Units 10 and 11) and
  1. (iii)
    37.37 MPa (Units 12 and 13),

which “in accordance with BS EN 13791 and CIA standards, demonstrate that the core sample results met the 32 MPa concrete requirement”.

[137]  Dr Khan explained:

  1. (a)
    It was important to differentiate between concrete’s core strength and its cylinder strength.
  1. (b)
    Concrete’s core strength is its compression strength as determined from testing cores drilled from existing slabs. Testing laboratories generally present the core compressive strength results as corrected core compressive strength results [as occurred in this case]. (The corrected compressive strength is generally calculated by using length to diameter factors for the cores where a length to diameter ratio of 2 after trimming is not achieved.)
  1. (c)
    Concrete cylinder strength is determined by testing standard cylinders, typically measuring 100 mm in diameter and 200 mm in height, which are cast in a well-controlled manner using concrete samples obtained during the pouring process and cured under controlled conditions.
  1. (d)
    Engineers generally use cylinder characteristic compressive strength.
  1. (e)
    Concrete core strength is generally lower than cylinder strength due to factors such as sample preparation, curing conditions, and surface preparation for testing. To account for these factors, and to compare in-situ strength with design strength, standards recommend applying correction factors when analysing core strength results.
  1. (f)
    AS 3600 (2018) clause B6.4.2 recommends using a factor of 1.15 when determining the strength of concrete using the average strength of cores. The recommended practice of the Concrete Institute of Australia in Z11 also recognises that in-situ concrete strength values based on the testing of cores are lower by an average of approximately 15% than the concrete strength obtained for the same structure at the same age from testing cylinders.
  1. (g)
    Dr Woolcock’s conclusion that the slab was understrength, assuming a conservative 10 per cent gain over time, was based mainly on core compressive strength. The average core strengths had not been converted to corrective strengths as per AS 3600 ([40] – [41]).

[138]  T 6-33 – T 6-34.

[139]  T 6-55 lines 34-42

[140]  T 6-44 lines 15 0 17.

[141]  Because it did not take into account the extent of the variations in the cores, which was necessary for a determination of characteristic strength – see 6-45.

[142]  T 6-45 – 6-47.

[143]  T 6-56.

[144]  T 6-49 – 6-50.

[145]  T 6-54 lines 1 – 10.

[146]  T 6-59 line 6 – T 6-62 line 47.

[147]  Pages 4636 to 4714 of Part D

[148]  Page 4729 of Part D.

[149]  T 7-12 line 13-42.

[150]  T 7-47, lines 29-32.

[151]  “Where hardened concrete is liable to rejection … the concrete may be accepted if it can be demonstrated, either by calculation or testing in accordance with Appendix B, that the structural adequacy and intended use of the affected members are not impaired. Otherwise the concrete shall be rejected.”

[152]  Pages 3452 – 3772 of Part D.

[153]  In reply to the reports of Khan, Reid and Munn, and having conducted that more comprehensive analysis, Dr Woolcock said that Dr Khan and Mr Reid misinterpreted Clause B6.4.29(a) of AS 3600 and over-estimated the characteristic compressive strength of the concrete: “… they consider that factoring the average core test results by 1.15 provides an estimate of the characteristic strength of the in-situ concrete whereas it only provides an estimate of the average cylinder strength. Furthermore, both experts have then compared the factored average results with the specified 28-day characteristic strength of 32 MPa and concluded that the concrete was compliant without allowing for any increase in strength between placement and testing ([04]).

Dr Woolcock was of the view that the expression used in Clause B6.4.2, “the strength of the concrete” was ambiguous. Recent commentary on it in “Z11” implied that it was outdated and in need of clarification. Z11 commented that “the strength of the concrete” might be incorrectly interpreted as an appropriate method for determining characteristic design strength, leading to an over-estimate of characteristic strength and the structural capacity of a member.

Dr Woolcock explained in detail the Z11 methods for determining compressive strength from core testing, including the formulas it proposed. Applying those formulas, and relying on BS EN 13791, Dr Woolcock’s estimate of the characteristic core strength after 6 years was 27.77 MPa, which, when factored by 1.15 resulted in an equivalent characteristic cylinder strength of 31.9 MPa.

Dr Woolcock then applied the percentage increase in strength over time as per a formula in the Eurocode 2 Part 1-1 (a European Code) or between 19% to 40%. Applying an increase in strength of 19% for a 32 MPa slab led to a characteristic strength of 38.1 MPa after 6 years. That was significantly higher than 31.9 MPa and, in his opinion, indicated that the uncontrolled addition of water prior to placement had weakened the concrete. Using a minimum increase in strength of 19% over time suggested that the concrete was only 26.8 MPa 28 days after pour, significantly less than the specified 32 MPa. However, in cross-examination, Dr Woolcock acknowledged that his “reverse calculation”, based upon the Eurocode, was inappropriate (for reasons I do not need to elaborate upon).

[154]  T 4-37 – 4-38.

[155]  T 4-40.

[156]  Page 4532 [19] – [22].

[157]  Pages 4526 – 4547 of Part D.

[158]  Dr Khan observed that –

  1. (a)
    Z11’s criticism of AS 3600 Clause B6.4.2 and the risk of its leading to an over-estimate of a structure’s “inherent” strength was “geared towards” older buildings without a defined design strength and served as a precaution. Also, as Dr Woolcock recognised, the danger in this context was likely in the assessment of suspended concrete structures, rather than slabs on ground.
  1. (b)
    Dr Woolcock’s assumed strength gain of between 19 to 40 percent was not based on evidence.
  1. (c)
    It was wrong/misguided of Dr Woolcock to use the European Standard EN 1992-1-1 to calculate the strength increase. The empirical equations in the standard were derived from extensive experimental data in Europe. They did not reflect the behaviour of concrete in Australia, with its crucial climate differences.
  1. (d)
    Also, the equation used by Dr Woolcock provided an estimate of mean compressive strength at any age, and not the characteristic compressive strength. Mean compressive strength over time should be calculated using mean equivalent cylinder strength.

[159]  T 4-23 – T 4-24.

[160]  Pages 4715 to 4764 of Part D.

[161]  Pages 4760 – 4762 of Part D: Mr Reid’s Appendix E.

[162]  See page 4752 and 4753 of Part D.

[163]  T 7-46, lines 44-49.

[164]  On 2800, rather than 2765, and on 1400 rather than 1448.

[165]  T 7-42 line 46-47.

[166]  T 7-46.

[167]  Page 4729.

[168]  See page 4732 - 4734 of Part D.

[169]  Page 4731-4734 of Part D.

[170]  Page 4717.

[171]  Page 4718.

[172]  Page 4730.

[173]  Pages 4548 – 4596 of Part D.

[174]  T 6-72 – T 6-73. In his oral evidence (T 6-89 lines 32 – 47), Mr Munn explained tensile strength. He said, “… [T]he compressive strength of concrete is … the key performance indicator for most concrete … Concrete is generally poor in flexural strength and tensile strength. In other words, the compressive strength is thumping the thing down, tensile strength is trying to pull it off … [T]he basic test that’s used is they drill a hole in … and then they try to pull a piece out to find whether the coating fails or whether it fails in the subbase underneath it …” He said a certain tensile strength was necessary so that the coating which was applied would not lift off. A pull test was done to test tensile strength. Relevant calculations for it were contained in AS 3600.

[175]  T 6-76.

[176]  T 6-77.

[177]  T 6-76 lines 5 – 30.

[178]  T 6-72 lines 1 – 7.

[179]  T 6-79 lines 20 – 6-80 line 3.

[180]  T 6-72.

[181]  T 6-75 line 43.

[182]  Page 4562 – 4563 of Part D.

[183]  T 6-74 – T 6-75.

[184]  That is, as required by AS 3600.

[185]  Pages 4597 to 4635 of Part D.

[186]  See pages 4604 – 4605 of Part D

[187]  Pages 4923 – 4933 of Part D.

[188]  During his cross-examination, Mr Munn acknowledged that he answered some questions which concerned matters that he did not assess. In doing so, he either drew on his general knowledge or, at least in two cases, copied Dr Khan’s answer.

[189]  See T 6-28 lines 30 – 40.

[190]  Page 4720 of Part D.

[191]  T 4-18.

[192]  T 4-34 – T 3-45.

[193]  T 4-17 – 4-18.

[194]  T 4-72 lines 19 – 25.

[195]  T 4-53 line 35 – 4-54 line 5

[196]  Other evidence suggested it should achieve between 90 and 95 per cent of its strength at 28 days.

[197]  T 4-23 lines 10 – 11.

[198]  T 6-57.

[199]  T 6-88 lines 1 – 15.

[200]  T 6-84 – 6-85.

[201]  T 6-85 lines 11 – 40.

[202]  “59. While I agree there is no evidence of major structural failure, the concrete being understrength means that it is not only unsuitable for the specified pneumatic-tyred traffic from an abrasion perspective in accordance with Table 4.5 of AS 3600 but also that the pavement’s structural capacity is inadequate for the design forklifts loads by my calculations as demonstrated below. [Table 4.3 of AS 3600] shows the minimum characteristic concrete strength at 28 days and should not be interpreted as the strength at some time in the future, the underlying assumption being, in my opinion, that strength will increase with time.

60. Using the CC&AA software with a CBR of 11, I calculate by interpolation from the 80kN and 100 kN axle loads and the 25 MPa and 32 MPa concrete strengths that are required slab thickness for unlimited repetitions of the 94 kN axle loads (corresponding to twice the 4.8 tonne design wheel load) that the required slab thickness is 177 mm for a characteristic 28-day concrete strength of 26.8 Mpa at placement. The parameters I have adopted for the analysis are:

  1. •
    Characteristic concrete strength 26.8 MPa
  1. •
    K1 = 0.9 for wheel loads (adopting an intermediate value between 0.85 and 0.95)
  1. •
    Unlimited repetitions, hence k2 = 0.5
  1. •
    CBR 11, hence short term modulus Ess = 41 MPa (=29/07)
  1. •
    Wheel spacing 1.45 m (typical for dual wheel front axle load of 10t, possibly smaller and if so, more severe)
  1. •
    Depth of soil 3 m
  1. •
    K3 = 1.2 for interior as opposed to edge loading
  1. •
    Axle load 94 kN (= 9.6t x 9.82)

61. Note that using the same parameters except using 32 MPa rather than 26.8 MPa, the required thickness is 168 mm which confirms that the Westera Partners’ design thickness of 175 mm is adequate.”

[203]  Page 3866 of Part D.

[204]  Pages 3946 – 3955 of Part D.

[205]  Pages 4831 – 4888 of Part D.

[206]  Pages 3956 – 3965 of Part D.

[207]  Pages 4921 – 4922 of Part D.

[208]  Cf Devaugh Pty Ltd v Lamac Developments Pty Ltd [1999] WASCA 280 at [33] and [107] referred to in SHA Premier Constructions Pty Ltd v Niclin Constructions Pty Ltd [2019] QCA 201.

By way of an example of the parties’ express terms applying in preference to the terms of AS 4902: It may be noted that the Scope of Works contained in Part F of Stage 2’s AS 4902 required the Stage 2 slab to be reinforced with “Helix Fibre Reinforcement”. The Tender Letter required its reinforcement “to Engineering Design”. Mr Ray decided not to use Helix Fibre Reinforcement was not used in Stage 2 – consistent with the Tender Letter and inconsistent with the AS 4902 contract.

[209]  Page 593 of Part C. Although they left the Superintendent’s phone number in – reflecting their less than careful approach to contract formation.

[210]  The absence of a Superintendent left the parties to deal directly with each other, which they did.

[211]  Although reports about its condition had been obtained by the plaintiff, and were referred to in evidence, they were not relied upon.

[212]  The defendant’s pleading’s reference to the “express purpose” of designing slabs for pneumatic tyred traffic had to mean slabs of 32 MPa at 28 days, in accordance with AS 3600. Thus, this pleading was inconsistent with the submission made to me by Kings Counsel for the defendant that its obligation was only to use N32 concrete and that it was not obliged to create a slab which was at 32 MPa after 28 days (see below).

[213]  See the discussion under the heading “The Stage 1 contract”.

[214]  Dr Khan applied the correct one (he divided by 0.85).

[215]  T 4-49

[216]  See the list of documents provided to Dr Woolcock at Page 2844 of Part D, especially documents (m). (n), (o) and (p).

[217]  Page 2844 of Part D.

[218]  See pages 4650 – 4687 of Part D.

[219]  Nevertheless, as explained – I proceeded on the basis that the slabs exhibited degrading, cracking, and dusting, beyond that which would be expected with normal wear and tear.

[220]  Submissions 8-14 – 8-15; [37] of the defendant’s written submissions.

[221]  Mr Reid thought the questions of the slab’s strength at 28 days; or whether it increased in strength over time, were irrelevant to the question of its compliance. He simply applied Appendix B of AS 3600 to the core test results and calculated the concrete’s strength as around 37 MPa, which meant it met its compliance requirement.

[222]  Submissions 8-30.

[223]  Page 2819 of Part D.

[224]  T 4-55, lines 10 – 16.

[225]  Submissions 8-11.

[226]  T 4-55 – 4-57.

[227]  Submissions 8-35 lines 39 – 49.

[228]  [1973] 1 WLR 1.

[229]  (1987) 2 NSWLR 310.

[230]  Page 2779 of Part C.

[231]  Submissions 8-37 lines 1 – 7.

[232]  PQ v Australian Red Cross Society [1992] 1 VR 19.

[233]  Submissions 8-57 – 8-62.

[234]  R v Naidu [2008] QCA 130 at [68] and the footnote to that paragraph.

[235] (a)  The plaintiff seemed to imply (at [234(a)]) that Mr Reid selected the highest k1 factor because it was favourable to the defendant’s case.

  1. (b)
    It submitted that because there had not been “careful construction control”, 0.90 should be the preferred k1 factor.
  1. (c)
    It submitted that Mr Reid ought not to have speculated about the loads and should have preferred Dr Woolcock’s unlimited load assumptions.
  1. (d)
    It submitted that Mr Reid’s adoption of 1.5 m for the soil depth assessment factor was contrary to the geotechnical analysis, which recorded rock depths of between 3.3 m and 4.9 m at bore hole 6, 10 and 11 on the eastern side, and 7 on the southern side.

[236]  See Elliott v Lawrence [1966] Qd R 440 at 444-445 and Stockland Property Management Pty Ltd v Cairns City Council [2011] 1 Qd R 77 at 99, cited in Built Qld Pty Ltd v Pro-Invest Australian Hospitality Opportunity (ST) Pty Ltd [2022] QCA 266 at [101].

[237]  (1954) 90 CLR 613.

[238]  (2009) 236 CLR 272 at [17].

[239]  (2017) 128 SASR 165.

[240]  Pages 2726 – 2736 of Part C.

[241]  Page 2737 of Part C.

[242]  This is, with respect, poorly drafted. I infer that (b) is intended to refer to the date upon which the Contractor ought reasonably to have been aware of the variation.

[243]  There is no clause 36.6 in the contract. It might mean the sentence which follows the reference to 36.6?

[244]  Submissions 8-53 lines 45 – 50.

[245]  The Tender Letter was included between Parts F and G of Annexure A.

[246]  

ITEMS NOT INCLUDED

As per Tender Letter

GENERAL EXCLUSIONS

As per Annexure F

  1. GST not included
  1. GST not included
  1. No excavation allowed for in rock or reef
  1. No excavation allowed for in rock or reef
  1. Council fees, contributions and head works charges, Energex fees
  1. Council fees, contributions and head works charges, and Energex fees
  1. No allowance for water meter readers
  1. No allowance for water meter readers
  1. Furniture or window coverings
  1. Furniture or window coverings
  1. Qleave to be paid for by owner

 

  1. Racking to warehouse
  1. Racking to warehouse
  1. Piling or Piering

 

  1. Nature strip or footpath upgrade other than required by council for approval
  1. Nature Strip or footpath upgrade other than required by council for approval
  1. Traffic Control
  1. Traffic Control
  1. Air conditioning or ventilation to main warehouse area
  1. Air conditioning or ventilation to main warehouse area
  1. Signage including power
  1. Signage including power
  1. Security
  1. Security
  1. Connection Fees
  1. Connection Fees
  1. All works outside property boundary excluded

 

  1. Data or Phone systems installation
  1. Data or phone systems installation
  1. Data Cabling
  1. Data Cabling to office fit out

Please note:

•Quote Valid for 30 days

•Onesector Pty Ltd standard terms and   conditions

•Final Design and plans to be approved by client

[247]  Page 1768 of Part A & B.

[248]  Page 1769 of Part A & B. The total amount of the variations claimed in that register (no mark-up, no GST) was $80,548.27. For what it is worth, I could not find a claim for any of the variations listed in that document in the progress claims made in relation to Stage 2.

[249]  Page 2728 of Part C.

[250]  Page 203 of Parts A & B.

[251]  Page 522.

[252]  Unit 9A, the office unit, was leased by Budget Pet Products from 1 July 2019 until 31 July 2026.

[253]  Described elsewhere in evidence as hard plastic/polyurethane wheels.

Close

Editorial Notes

  • Published Case Name:

    Hestbay Pty Ltd v One Sector Pty Ltd

  • Shortened Case Name:

    Hestbay Pty Ltd v One Sector Pty Ltd

  • MNC:

    [2024] QSC 180

  • Court:

    QSC

  • Judge(s):

    Ryan J

  • Date:

    22 Aug 2024

  • White Star Case:

    Yes

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited

Case NameFull CitationFrequency
Alexander v Cambridge Credit Corp Ltd. (1987) 2 NSWLR 310
1 citation
Jump To
Cite 1 - (1987) 2 NSWLR 310
Bellgrove v Eldridge (1954) 90 CLR 613
2 citations
Jump To
Cite 1 - (1954) 90 CLR 613
Cite 2 - (1954) 90 CLR 613
Built Qld Pty Ltd v Pro-Invest Australian Hospitality Opportunity (ST) Pty Ltd(2022) 13 QR 148; [2022] QCA 266
2 citations
Jump To
Cite 1 - [2022] QCA 266
Cite 2 - [2022] QCA 266
Devaugh Pty Ltd v Lamac Developments Pty Ltd [1999] WASCA 280
1 citation
Jump To
Cite 1 - [1999] WASCA 280
Elliott v Lawrence [1966] Qd R 440
2 citations
Jump To
Cite 1 - [1966] Qd R 440
Cite 2 - [1966] Qd R 440
Hestbay Pty Ltd v One Sector Pty Ltd(2023) 15 QR 319; [2023] QSC 154
2 citations
Jump To
Cite 1 - [2023] QSC 154
Cite 2 - [2023] QSC 154
Makita (Aust) Pty Ltd v Sprowles (2000) 52 NSWLR 705
1 citation
Jump To
Cite 1 - (2000) 52 NSWLR 705
McGhee v National Coal Board [1973] 1 WLR 1
2 citations
Jump To
Cite 1 - [1973] 1 WLR 1
Cite 2 - [1973] 1 WLR 1
PQ v Australian Red Cross Society (1992) 1 VR 19
2 citations
Jump To
Cite 1 - (1992) 1 VR 19
Cite 2 - (1992) 1 VR 19
R v Gibson [2022] QCA 151
2 citations
Jump To
Cite 1 - [2022] QCA 151
Cite 2 - [2022] QCA 151
R v Naidu [2008] QCA 130
3 citations
Jump To
Cite 1 - [2008] QCA 130
Cite 2 - [2008] QCA 130
Cite 3 - [2008] QCA 130
Sanrus Pty Ltd v Monto Coal 2 Pty Ltd (No 6) [2019] QSC 214
1 citation
Jump To
Cite 1 - [2019] QSC 214
Sanrus Pty Ltd v Monto Coal 2 Pty Ltd (No 7) [2019] QSC 241
1 citation
Jump To
Cite 1 - [2019] QSC 241
SHA Premier Constructions Pty Ltd v Niclin Constructions Pty Ltd [2019] QCA 201
2 citations
Jump To
Cite 1 - [2019] QCA 201
Cite 2 - [2019] QCA 201
Stockland Property Management Pty Ltd v Cairns City Council[2011] 1 Qd R 77; [2009] QCA 311
2 citations
Jump To
Cite 1 - [2011] 1 Qd R 77
Cite 2 - [2011] 1 Qd R 77
Stone v Chappel (2017) 128 SASR 165
2 citations
Jump To
Cite 1 - (2017) 128 SASR 165
Cite 2 - (2017) 128 SASR 165
Tabcorp Holdings Ltd v Bowen Investments Pty Ltd (2009) 236 CLR 272
2 citations
Jump To
Cite 1 - (2009) 236 CLR 272
Cite 2 - (2009) 236 CLR 272

Cases Citing

Case NameFull CitationFrequency
Hestbay Pty Ltd v One Sector Pty Ltd [2025] QSC 4 2 citations
1

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