Anthony J Healy Antiques Pty Ltd v P and D Envirotech Pty Ltd

[2021] NSWDC 308

District Court

New South Wales

Medium Neutral Citation:

Anthony J Healy Antiques Pty Ltd v P & D Envirotech Pty Ltd [2021] NSWDC 308

Hearing dates:

11 May 2021
13 May 2021
14 May 2021
17 May 2021

Date of orders:

17 May 2021

Decision date:

17 May 2021

Jurisdiction:

Civil

Before:

Montgomery DCJ

Decision:

(1)   Judgment for the defendant against the plaintiff.

(2)   Plaintiff to pay the defendant’s costs.

Catchwords:

CONTRACTS — Construction — Extrinsic evidence

CONTRACTS — Express terms — Pre-contractual statements

Cases Cited:

Equuscorp PtyLtd v Glengallan Investments Pty Ltd (2004) 218 CLR 471

Pacific Carriers Limited v BNP Paribas (2004) 218 CLR 451

Category:

Principal judgment

Parties:

Anthony J Healy Antiques Pty Ltd, First Plaintiff
Anthony J Healy, Second Plaintiff
Catherine Healy, Third Plaintiff
P & D Envirotech Pty Ltd, Defendant

Representation:

Counsel:
Mr Bennett, First, Second and Third Plaintiff
Mr Carolan, Defendant

File Number(s):

2020/00079732

Judgment (Ex Tempore)

1. By the Amended Statement of Claim (‘ASOC’) handed up at the commencement of the hearing and upon which the plaintiff proceeded by consent, Anthony J Healy Antiques Pty Ltd, sues P & D Envirotech Pty Ltd for recovery in 2 categories.

• Firstly for recover of $32,346.93 over payment for demolition services provided by the defendant; and

• Secondly, for $18,672, consequential loss being rectification cost of damage caused during the defendant’s conduct of the demolition. The concept of demolition should be understood in the specialist avenue of the clean-up of asbestos contaminated waste following fire damage.

2. The second and third plaintiffs were directors of the corporate first plaintiff. For convenience in these reasons I will refer to the company as the plaintiff and to Mr Healy as the second plaintiff and Mrs Healy as the third plaintiff.

3. Most of the facts pleaded in the ASOC are not disputed. The plaintiff carried on business selling antiques and homewares under the trading name “The Old Pot Factory” on land known as 44-54 Old Hume Highway Balaclava near Mittagong New South Wales (‘the Property’). The Property was a converted house, the facade of which imitated a hacienda. The location at which the subject works were carried out at the property was at the front in a part of the building known as the showroom which was 328 m² in size. The second and third plaintiffs owned the Property in partnership. The defendant carried on the business of specialist removal of friable/bonded asbestos demolition, lead paint removal, soil removal, remediation and environment site clean-ups. The defendant was a Licensed Asbestos Removal Contractor (‘LARC’).

4. On 15 August 2019 the property suffered extensive fire damage. On 29 August 2019 the second and third plaintiffs met the defendant’s estimator, Mr Andrews, at the Property. They asked him to quote demolition and environment clean-up of the site. The second and third plaintiffs had already met with a representative of EDP Consultants Pty Ltd and a report on asbestos sampling investigation of the fire damaged Property was known to be pending. The second and third plaintiffs informed Mr Andrews that the defendant would receive the report. The EDP report dated 29 August 2019 was authored by Mr Pittaway, a Licensed Asbestos Assessor (‘LAA’).

5. The plaintiff case in the first recovery relies heavily on the discussion between the second and third plaintiffs, and Mr Andrews on 29 August 2019.

6. On 12 September 2019 the defendant quoted the sum of $143,396 for clean-up of the site, including the removal of asbestos (‘the First Quotation’). Subsequently, on 29 October 2019 the defendant quoted the sum of $130,589.80 inclusive of GST for the work (‘the Second Quotation’). The plaintiff accepted the defendant’s Second Quotation. The parties agree they contracted when the plaintiff accepted the Second Quotation and that the work was thereafter carried out pursuant to that contract. On 4 February 2020 the plaintiff paid the defendant in full the defendant’s invoice issued 13 December 2019 for the contract price of $130,589.80 inclusive of GST. The plaintiffs’ first claim is for recovery of overpayment.

7. The Second Quotation (the contract) expressed the scope of work as follows:

“SCOPE: Removal of contaminated waste as outlined in the EDP report. Price revised on engineers report.”

Duration would be nine regular days Monday to Friday which included one day for asbestos removal from the front of the building.

The contract provided that the client supply all electrical, plumbing and gas isolation where applicable

PRICE:

Labour N/T- Inc. Travel

Consumables

Water

Excavator

Excavator transport

Decontamination Unit

1-day Asbestos Removal

Truck & Dog Loads – Approx. 8

Air Monitoring & Clearance

Steel Bins

Total (Excl GST)      $118,718.00

GST           $11,871.80

Total (Incl GST)      $130,589.80

NOTE: This price only includes an allowance for approximately 170 tonne of debris (contaminated waste) anything over that quantity will be charged at $385 plus GST per tonne cart and dispose.

Also no allowance has been made for containers and structures at the rear of the property.”

8. It was an express term of the contract that the defendant “must ensure that” on completion of the work, a clearance inspection of the asbestos removal is carried out as required by Work Health Safety Regulations. It was an express term of the contract that the defendant must prepare an asbestos removal control plan (‘ARCP’) for the work and that the cost of the ARCP was included in the price. A further term of the contract provided as follows:

“An allowance has been made for monitoring and clearance. This is mandatory in some circumstances and is the responsibility of the waste generator to supply, or make available, this information prior to the start of any removal of waste from site. Air monitoring and reoccupation certificates will offer the site owner some proof of compliance in future construction or site occupation.” (Italics added for emphasis).

9. The “engineers report” referred to in the above quoted expression of the scope of works is a reference to the report of Mr Thomas, structural/civil engineer, of Thomas Mayne Pty Ltd. It was dated 21 October 2019. It is convenient to refer to it as “Mr Thomas’ first report”. It was provided to the defendant on 24 October 2019, that is, prior to the contract and after the First Quotation.

10. The amount of asbestos removed from the property on completion of the works was only 93.62 tonnes, not the 170 tonnes “allowance” expressed in the contract. The plaintiff’s first claim for $32,346.93 is the calculated difference of 76.38 tonnes at the rate of $385 per tonne plus GST, being the “anything over” rate expressed in the contract.

11. The plaintiffs’ second claim is for the cost of temporary stabilisation by propping of a brick veneer/stud wall (‘the stud wall’). The stud wall was tied by roofing members to the shopfront façade wall of the Property. For proof of quantum the plaintiff relies on an email quotation by Mr Herborn, builder, dated 5 February 2020.

12. During opening, the parties identified three issues for determination:

• Issue 1: Whether or not the parties made a lump sum contract;

• Issue 2: Whether or not the defendant caused damage to the structural support of the shopfront for which the plaintiff is entitled to $18,672 rectification costs; and

• Issue 3 (subsidiary to Issue 2): Whether or not the plaintiff would have had to provide the temporary support of the façade wall quoted by Mr Herborn in any event.

13. The defendant agrees that it removed timber bearers, which were structural support timbers from behind the stud wall. The defendant agrees that its machine caused damage to the Western and Eastern brick walls.

14. In order to understand the facts and the parties’ cases it is important to recognise that there were two walls at the front of the showroom referred to in the evidence. The hacienda fashion facade wall (the ‘façade wall’) stood on columns and was the first wall as one approached the entrance to the showroom. The stud wall was some metres further in that course of approach. The stud wall held windows and the entrance doors to the showroom. On approach a customer would walk under the hacienda style facade wall by passing between its columns, then cross a tiled area to the entrance doors in the stud wall, beyond which was the showroom. The situation of the facade wall and the stud wall including timber roofing ties and paved flooring can be seen in photographs numbered 72 to 74, 84 (top photograph), 85 to 87 (top photograph) of exhibit D, X01 to the affidavit of Mr Riches sworn 29 October 2020.

15. As to the plaintiff's first claim and Issue 1; the plaintiff says that in pre‑contractual negotiation the parties agreed that the defendant's price quoted would depend on tonnage of asbestos contaminated material to be removed and disposed of. The plaintiff argues that evidence of pre-contractual negotiations is admissible as evidence of that mutually understood background fact in circumstances of ambiguity of the written contract.

16. The plaintiff argues that the difference between the First Quotation and Second Quotation is evidence of background knowledge to be applied to construction of the contract, that is, that the parties intended to contract on a fixed price per tonne basis.

17. The defendant says that the written contract is unambiguously a lump sum contract for the works at a price of $130,589.80, with a rise call provision covering the risk that asbestos contaminated debris to be removed might exceed 170 tonnes. On the defendant's argument it was a lump sum contract pursuant to which the defendant accepted the risk up to 170 tonnes of contaminated material clean up, and above that quantity the defendant was entitled to charge $385 per tonne for asbestos contaminated material removed.

18. The parties agree that Mr Thomas's first report removed from the scope of works contemplated at the time of the First Quotation, demolition and removal of the facade wall, the stud wall and the western return brick wall. It is common ground between the parties that, that reduction in the scope of works, explains the reduction in the quoted total price between the First Quotation and the Second Quotation.

19. This is reflected in the reduction from 250 tonnes of contaminated debris and a total price of $143,396 including GST in the First Quotation to 170 tonnes in the sum of $130,589.80 including GST in the Second Quotation. The quotations are annexures B and C to the affidavit of the second plaintiff made 14 September 2020 (‘the second plaintiff’s first affidavit’). It can be seen that only the Second Quotation included reference to Mr Thomas' engineering report in the expression of the scope of work.

20. It is common ground that the stud wall was rendered unstable by the defendant's removal of wood bearers. The defendant says that Mr Thomas' first report did not advise a scope of work other than it provided an opinion contemplating the facade wall be retained and that it remained the plaintiff's onus to provide bracing for the stud wall in order to maintain its stability and therefore by the roof ties, the façade wall. The plaintiff's case is that the works could have been completed without removal of the bearers, being the structural support timbers from behind the stud wall.

Consideration of Factual Evidence

21. It is common ground that neither Mr Andrews nor Mr Thomas moved amongst the debris when inspecting the property prior to the demolition and clean-up work carried out by the defendant. One would not have expected them to do so in circumstances of known asbestos contamination. One would assume that to venture into the debris required the wearing of PPE and the taking of other safety precautions which is required in an asbestos environment. It is also common ground that a concrete slab could be seen in some locations amongst the debris and from that observation it is likely that Mr Thomas assumed there was a concrete slab throughout the showroom. Mr Riches, who is a director of the defendant, said in oral evidence that the defendant quoted on the basis of that same assumption. In fact, it was discovered during the demolition and clean up works that there was a concrete slab below the western return wall but that the stud wall did not stand on the concrete slab and the showroom was of wooden floor construction above soil.

22. By his first affidavit, the second plaintiff recounted the history of the making of the contract and of his observation of the works. There is no dispute as to the chronology of events. He commenced at 29 August 2019 when Mr Andrews, the defendant’s estimator was introduced to the works on site by the second and third plaintiffs (second plaintiff’s affidavit, 14 September 2020, p 30). The third plaintiff and Mr Andrews also gave affidavit and oral evidence of the discussions at that meeting. The second plaintiff deposed that in the course of discussion he requested the defendant:

“Provide me with a quote for removal of the asbestos and debris from the showroom”.

This was after he confirmed the defendant’s specialist expertise in the area of work. He put the key part of the discussion as follows:

“Second plaintiff: When will we know what the weight of the debris is and how do you calculate the charge?”

Mr Andrews: There are two ways of doing this. One way is by way of fixed price contract or we estimate the tonnage and tally this at the end of the dumping. We will have weight receipts. My estimate of the tonnage will be on the quote that I provide you.

Second plaintiff: I would like to see the weight receipts when you are finalised.

Mr Andrews: Okay I will make sure that you get to see them.”

23. At one point during oral evidence, the second plaintiff mentioned Mr Andrews using the expression “lump sum”. But the effect of his evidence was that he recalled a “fixed price based on tonnage”. He denied that the contract alternative offered by Mr Andrews were “lump sum” or by “rates”. Both the second plaintiff and the third plaintiff said they did not recall Mr Andrews mentioning “rates”. In his affidavit, made 3 November 2020 relied upon by the defendant, Mr Andrews denied the above first person speech attributed to him regarding the alternatives for contracting. In oral evidence, he frankly conceded he could not remember precisely the words used. At [7] of his affidavit, Mr Andrews deposed that; the defendant provides either a fixed price contract or a “do and charge” basis. And that his recollection is that the third plaintiff said to him words to the effect of “we would like a fixed price contract”.

24. Each of the second plaintiff, the third plaintiff and Mr Andrews agree that is what the third plaintiff instructed at the end result of their negotiations. Indeed in her affidavit, made 11 December 2020, the third plaintiff at [5] set the conversation out in first person as follows:

“Third plaintiff: Tony and I would like a fixed price contract.

Mr Andrews: Okay. If you can reduce the weight by salvaging pieces that will reduce costs. The final tonnage will dictate what you pay.

Third plaintiff: Will we get to see the weight receipts so that we know the amount of weight removed and what has been paid?

Mr Andrews: Yes.

Third plaintiff: Once I have the asbestos report from EDP I will email it straight to you. Thank you for your assistance today. You have given us very helpful advice. I look forward to moving on this.

Mr Andrews: Once I have the report, I will send you a fixed price quote.

25. In oral evidence the third plaintiff said she did not know the expression “do it by rates”, but frankly conceded that she could not say that the word “rates” was not part of the discussion. In oral evidence, Mr Andrews conceded that he might have mixed up words of “lump sum” and speaking of “fixed rate”. In cross-examination Mr Andrews agreed that he told the second and third plaintiffs that what they salvaged would reduce weight and cost and that final tonnage would dictate what the plaintiff paid. He also agreed that the third plaintiff asked for weight receipts to see the tonnage removed and what needed to be paid. But in cross-examination when it was put specifically that the reason for giving weighbridge receipts was because the defendant and the plaintiff needed to know the total tonnage removed, he answered that the defendant’s usual practice was to give the client those receipts so the client could prove the lawful removal and disposal of contaminated materials. I consider it a matter of common sense that municipal councils or tradesmen coming on site might require that proof. I also note this is consistent with the final sentence of that which I above quoted of the scope of works from the contract. That was the sentence commencing with air monitoring and reoccupation certificates. The waste tracking dockets are annexure F to the second plaintiff’s first affidavit. They record only asbestos contaminant waste and disposal. There is no mention of disposal other than contaminated waste in them.

26. Each of the second and third plaintiffs and Mr Andrews gave truthful evidence. Their common evidence is that they were discussing how the cost of the job would ultimately be affected by the tonnage of material to be removed and that the plaintiff could reduce that cost by removing salvageable material and therefore reducing tonnage. It is apparent from how they gave their oral evidence and from those concessions by the third plaintiff, and Mr Andrews, that their memories of precisely the words used of “lump sum”, “fixed price” and “rates” were captured in their understanding of the whole of the conversation. I am not persuaded that quoting on a “fixed price” per ton basis was the mutually achieved oral agreement.

27. At p 28 of exhibit D X01 to the affidavit of Mr Riches, made 29 October 2020, (Mr Riches Affidavit) is an email from the third plaintiff to the defendant instructing the defendant that the plaintiff had decided to keep the façade and return walls. The request made by the plaintiff to the defendant was:

“Could you review your quote based on the attached?”

The “attached” was Mr Thomas’s first report dated three days earlier. Mr Thomas’s first report included drawings indicating the façade wall, the stud wall, east and west return brick walls and a storage area to be retained. At [13] of his affidavit, Mr Riches confirmed that the Second Quotation was less than the First Quotation because it took into account the salvaging of the façade, returns and storage, salvaging of the façade wall, stud wall, returns and storage area. Mr Riches deposed that the Second Quotation was signed and accepted by the plaintiff on 5 November 2019.

28. At [15] of his first affidavit, the second plaintiff misquoted the above set out significant term expressed in each of the First Quotation and the Second Quotation/contract, the original Statement of Claim and the ASOC likewise misquoted that significant term. In each of those documents, the plaintiff omitted the word “only” from the words after “NOTE”. In the ASOC and affidavit evidence, the passage is quoted as:

“This price includes an allowance for approximately 170 tonnes of debris (contaminated waste)...”.

The First Quotation and the Second Quotation provided:

“This price only includes an allowance for ...” (bold added for emphasis)

In my view, the word “only” is prescriptive of the quantity of 170 tonnes and assists the defendant’s argument of construction because it is consistent with a rise call term for quantities exceeding 170 tonnes.

29. The defendant provided the waste tracking dockets in December 2019. The dockets spoke of the amount of asbestos removed from the property in the weight of 93.6 tonnes of debris. On 16 December, the plaintiff queried:

“Shouldn’t the invoice reflect this?” (Second plaintiff first affidavit, annexure G).

On 19 December 2019, the defendant responded by email (second plaintiff first affidavit, annexure H). The defendant stated that the second quotation was for:

“A lump sum price irrespective of cost overruns and under costs”.

In that email, Mr Riches explained, “contingencies” are things which the defendant allowed for in its lump sum pricing and extra costs which were absorbed in the risk of the job. Amongst those extra costs was reference to the fact, not disputed in the hearing, that the work took five days longer that was allowed for in the scope of works with labour, materials, PPE and machine costs running at the defendant’s risk.

30. Mr Riches’ affidavit at [24]-[26] expanded on contingency costs incurred during the works. He explained that in addition to removal of waste referred to in the waste tracking documentation that was provided to the plaintiff on 19 December 2019, the defendant also removed scrap metal, concrete and bricks.

31. Mr Riches explained that whereas the first report of Mr Thomas proposed the floor was concrete, it was found to be predominantly timber and that the timber “had to be removed due to potential contamination and [also because of] structural instability due to the fire” (at [35]). Also that some of the timber supports had to be removed to gain the hygienist clearance and that some of the supporting timber was dislodged when the floor was removed (at [36]). During cross-examination he was unshaken in his evidence and explained that, in fact, when in the course of the works, it was discovered that the common assumption of concrete slab made by Mr Andrews and Mr Thomas was wrong, a lot more work was involved and it was accepted that the defendant “had to stick to” the lump sum price.

32. In his oral evidence Mr Riches explained that it was not within the scope of the defendant as an LARC to identify contaminated and uncontaminated material. He said the making of that assessment was for the LAA who in this case was EDP. He maintained that the timber bearers had to come out from below the stud wall because they were identified as contaminated in the LAA specification. In cross-examination he was unshaken in that evidence. He referred to the need to achieve a hygienist clearance on completion. That was a reference to a clearance by the LAA.

33. In my opinion, Mr Riches’ evidence in this regard was consistent with the above quoted last sentence wording of the contract. Mr Riches’ evidence of the defendant’s obligation to remove the timber is consistent with requirements of the LAA in the EDP report (at [8], p 5) and asbestos sampling investigation results depicted on a floor plan (at p 14). The EDP report was incorporated in the description of the scope of works contracted.

34. It was argued by the plaintiff that the EDP report scope requiring removal of all “porous items within the contaminated areas of the building” did not include the timber bearers, whose removal according to all the expert evidence, contributed to the cause of the stud wall becoming unstable. In their submission, the plaintiffs referred to words within parenthesis in the provision in the EDP report which included “i.e., fabric, carpet, curtains or clothing”.

35. It is implicit from Mr Riches’ evidence that he included the wood bearers in that specification. There is no expert evidence in the case as to the meaning of “porous” as used in the EDP report. The Macquarie Dictionary gives the meaning “permeable by water, air, or the like”. On the evidence, I accept that the scope of work included removal of the timber. Indeed the second plaintiff, in his affidavit made 11 December 2020 at [17] responding to Mr Riches’ affidavit, agreed with Mr Riches that the timber floor under the stud wall had to be removed due to potential asbestos contamination.

36. In my opinion, the plaintiff has failed to prove on the balance of probabilities a different scope of work.

37. On 20 December 2019, Mr Thomas’ second report of that date was received by the plaintiff. I understand that post-works report to have instigated, obtaining from Mr Herborn his estimate of the cost of temporary support of the façade wall dated 5 February 2020, in the sum of $18,672.00

38. In December 2019 and January 2020, the plaintiff, including by its solicitor, insisted that the final invoice be reissued for the lesser quantity of debris removal and the defendant maintained its position of lump sum contract including by issuing a reminder to pay. On 4 February 2020, the plaintiff paid the defendant’s invoice in the full sum of the contract, the Second Quotation.

Consideration: The Plaintiff’s First Claim - The Contract Claim

39. The contract made on the plaintiff’s acceptance of the Second Quotation, was wholly in writing. The parties join in presenting the appropriate principles to the Court and therefore I state them shortly as follows:

• Where a contract is wholly in writing, evidence of the pre-contractual negotiations between the parties and of conduct subsequent to contracting is not admissible on the question of construction of the contract: Equuscorp PtyLtd v Glengallan Investments Pty Ltd [2004] 218 CLR 471; [2004] HCA 55 at [33] – [37]. That is so even where the parties reached an oral agreement earlier than the making of the written agreement.

• Having entered the written agreement each party is bound by it unless able to rely on a defence of non est factum or able to have it rectified: Equuscorp ibid. Neither of those forms of relief is pressed by the plaintiff here.

• A reason the law excludes parole evidence of another agreement, if there be a written agreement, is because in the nature of things, oral agreements will sometimes be disputable. Resolving such disputation is difficult, time consuming, expensive and problematic.

“Where parties enter into a written agreement, the Court will generally hold them to the obligations that they have assumed by that agreement. At least it will do so unless relief is afforded by the operation of statute or some other legal or equitable principle applicable to the case.”: Equuscorp supra at [35].

• The meaning of a commercial contract is determined objectively; the construction of the written contract is to be determined by what a reasonable person in the position of the parties would have understood it to mean. That requires consideration, not only of the text of the document but also of the surrounding circumstances known to the parties and the purpose and object of the transaction: Pacific Carriers Limited v BNP Paribas (2004) 218 CLR 451; [2004] HCA 35 at [22].

40. The plaintiff argues that the contract was ambiguous and it should be interpreted for waste removal on a “per tonne” basis because:

1. There was discussion and accepted obligation on the defendant to provide weighbridge dockets “These were otherwise irrelevant” (plaintiff written submission, MFI 4, at [40]).

2. Soon as being made aware of it the plaintiff queried the charges for material removed on the basis of weighbridge dockets showing the removal of less than 170 tonnes of contaminated material.

3. The defendant’s email of 19 December 2019, forwarded after completion the works referred to a “lump sum cap price irrespective of cost over runs and under costs”; and

4. The contract “makes only allowance for 170 tonnes (as a guide) but shows that is price per actual tonne taken” (plaintiff written submission, MFI 4, at [40]).

41. The defendant submits that the contract is unambiguous in providing a lump sum price for the removal and disposal of contaminated waste of “approximately 170 tonnes” and providing a rise clause for “anything over that quantity” to be charged at $385 plus GST per tonne. The defendant properly submits that there was no fall clause for a quantity under 170 tonnes.

42. In my opinion, the written contract was not ambiguous and the words following “Note” which were in bold in the contract as quoted above, read with the document as a whole, did not provide a guide as the plaintiff puts it and did not show that the agreement was for a price per tonne actually taken as the plaintiff argues. Further, the provision of weighbridge receipts was not “otherwise irrelevant” as the plaintiff argues. I accept the evidence given by Mr Andrews in which he explained that it was usual practice to provide those dockets to clients in order for clients to be equipped to deal with local authorities and subsequent building contracts when they are required to provide that contaminated material had been removed and legally disposed of by a LARC pursuant to a specification and clearance on completion from a LAA.

43. Indeed, the delivery of such certificates as proof of compliance is referred to in the contract. I accept the defendant’s submission that the parties entered into a lump sum contract where the defendant took the risk of the cost of demolition and clean up of approximately 170 tonnes of contaminated waste, and in the event that contaminated waste exceeded that quantity the defendant would charge $385 plus GST per tonne for the extra. The purpose and object of the contract was removal and disposal of asbestos contaminated debris in the course of post-fire demolition within the prescribed scope of works.

44. I deal with two other arguments put by the plaintiff for completion. In regard to the argument I identified as (iii) above, that the defendant emailed subsequently on 19 December 2019 referring to the cost of over runs and under costs, is not a matter for application of construction of the written contract according to principles of law. Those words as used are not only understandable as a reference to a rise and a fall contractual provision, but to costs which were less than the defendant estimated for itself and costs which would be more than the defendant estimated for itself when offering the lump sum price. The plaintiff also referred to the written terms and conditions which are in a standard form and which were attached to the Second Quotation which became the contract. Those numbered terms and conditions are not of assistance in this case. That is because they expressly only applied in the event of a variation of scope of work. That was term 1. Such a variation did not occur here.

45. It follows that the plaintiff’s claim for recovery of $32,346.93 fails. I have found, in any event, on the evidence concerning the discussion between the second and third plaintiffs and Mr Andrews on 29 August 2019 that I am not persuaded that they in fact agreed a fixed price per tonne of contaminated debris removed and disposed of. I repeat, that finding, is in any event not determinative of the plaintiff’s first claim because the written contract was unambiguous and for a lump sum.

Plaintiff’s Second Claim – Consequential Loss Caused During the Defendant’s Conduct of the Demolition

46. The plaintiff’s second claim is pleaded in the ASOC at [19]. That paragraph provides as follows:

“Despite the advice provided to the defendant by the plaintiff’s structural engineer regarding safety and structural concerns with respect to the showroom, when it removed asbestos from the property, the defendant impacted bearers and engaged brick piers, and in doing so, rendered the showroom structurally unsafe.”

47. The plaintiff’s paragraph [19] combines the following propositions:

1. That Mr Thomas’ first report provided advice on structural concerns for the carrying out of the removal of the asbestos contaminated material. That is that Mr Thomas’s first report provided an engineering specification for how the work was to be carried out;

2. The defendant removed timber bearers which supported the stud wall structurally;

3. The defendant impacted brick piers; and

4. The defendant impacting of bearers and brick piers rendered the showroom structurally unsafe.

48. The plaintiff submits that the words “impacted bearers” refers to removal of the bearers from the top of the brick piers and from underneath the structure of the stud wall. Mr Thomas’ second report referred to the pier engaged bearers. The defendant has not submitted otherwise and for the purposes of this judgment I accept that removal of those timbers contributed to the instability of the stud wall and therefore because of the stud and façade walls being tied by roof timbers, the façade wall. There is no evidence that damage to brick piers by the defendant’s machine operator contributed to structural insecurity of the façade wall. Finally, whilst the showroom is referred to in the paragraph, in fact the plaintiff’s case as run was that the façade wall became unstable because the stud wall was unstable. In turn, the façade wall was supported by the eastern and western return brick walls as well as the stud wall.

49. It is convenient to repeat that the common ground is, removal of the timber bearers at the top of the brick piers of the stud wall structure contributed to the instability. Photographs annexed “K”, “L” and “M” to the second plaintiff’s first affidavit show the sagging in horizontal elements of stud wall timber above where timber bearers were removed and a window that had fallen out from the stud wall. Those observations were appropriately conceded by counsel for the defendant.

50. The defendant, I repeat, agrees that it removed the wood bearers as it was bound to do within the scope of works and the specification of the LAA that is in the EDP report.

51. Mr Thomas’s first report identified as “Item 1” the “Rendered Brick Façade and Concrete Floor slabbing”. The “Rendered Brick Façade” was the façade wall not the stud wall. His first report provided the following specification in regard to the scope of work as incorporated in the contract

“ITEM 1 WAS UNAFFECTED BY THE FIRE and is a valuable asset which will keep the character of the Building Entrance and is worth saving. The rendered brick wall Westside (up to the stud wall, which will be demolished) is structurally sound and can be retained. There is no need whatsoever to demolish providing the current temporary support is maintained when the building behind is rebuilt.” (italics added for emphasis)

52. In that passage, Mr Thomas’ first report observed that the rendered brick wall return on the Westside was structurally sound. He does not expressly state anything about structural soundness of the stud wall, more specifically he does not specify how to go about work in regard to maintaining structural stability of walls.

53. Those words identified that the façade wall return brick wall, Westside wall and the stud wall be excluded from demolition, whilst acknowledging keeping the stud wall was temporary support for the façade wall and that the stud wall would be demolished when the building was rebuilt. It is common ground that the plaintiff intended to rebuild. Indeed, it is common evidence that Mr Thomas was retained to design the slab, it having been determined during demolition that the showroom floor was not a concrete slab construction as he had assumed at the time of his first report. Unfortunately Mr Thomas was deceased before he designed the slab.

54. After completion of the work, Mr Thomas’s second report of 20 December 2019 recorded the fact, as is agreed, that the timber bearers had from upon engaged brick piers, been removed “although it was plainly clear that the Façade Structure was to be left standing - as it still is, but now in unsafe condition.” He commented that removal of the bearers from the engaged piers had effectively removed support from the stud wall which supported the façade wall. To him it appeared that;

“[A] Lack of understanding or carelessness” allowed the bearers to be removed. It was quite unnecessary and all that needed doing was to cut the joists, leaving the stud wall supported as it has been since it was built. We cannot explain, Why it was done the way it was.”

55. Firstly, as appears in reasons above, Mr Riches’ evidence that the timber bearers were damaged by fire was unchallenged and the second plaintiff conceded that those timbers had to be removed. In my opinion, that evidence explains the “Why” raised by Mr Thomas. More importantly, nothing in Mr Thomas’ first report provided an engineering specification as to how to carry out the work. This point is confirmed in the expert report of Mr Knightly of RJK Consulting Engineers dated 17 December 2020 at [12.7]-[12.10].

56. Further, Mr Thomas’ first and second reports do not provide expert opinion that but for the removal of the timber bearers the stud wall was structurally sound absent propping. The point observed by Mr Knightly is that Mr Thomas did not conduct a structural calculation. As expressed in [12.10]:

“As such I find that Mr Thomas was provided insufficient structural advice in his report to adequately allow a competent tradesman adequate scope to complete the demolition work. More so, Mr Thomas has not readily addressed the requirements of safety in design work...”

57. Mr Algie of A & R Engineering Design Pty Ltd, structural engineers, by report 9 February 2021, did not challenge those observations of Mr Knightly but commented that a competent tradesman when confronted by a situation that prevents them from adequately scoping the work that is required would seek further advice or not take on the job. Mr Algie commented that a tradesperson has a duty to provide a safe work environment for their employees, the owners and the public. However, at [4] of his report, Mr Algie did not commit to the proposition that the stud wall would have been structural stable prior to the demolition and removal of the timber bearers. Also, he assumed that the bearers were not fire damaged which is not the evidence. I, therefore, do not prefer Mr Algie’s opinion that given the scope of work specified in the EDP report requiring the removal of timber, that the defendant was not contractually obliged to remove the bearers.

58. I am not persuaded the defendant’s scope of work should be expanded to include the obligations of a principal contractor or builder. The defendant was retained for the specific contractual task of waste removal and clean-up in the course of a demolition. In accordance with the prescription and ultimate clearance requirements of EDP as the LAA there is nothing in the specification including after consideration of Mr Thomas’ first report which obliged the defendant to retain the bearers engaged below the stud wall. The plaintiff has not pleaded a case of breach of implied condition to take reasonable care: The plaintiff has not pleaded a case in negligence.

59. The façade wall has remained standing now for one and a half years without any propping save for that provided by the second plaintiff leaning timber members against each side of the stud wall. The expert opinion evidence, in any event, is not persuasive of finding, that on the balance of probabilities; even had the timber bearers burnt and damaged to the extent they may have been, been left in position, the stud wall would not have required propping in any event in order to provide temporary structural support for the façade wall. It follows that I reject the plaintiff’s second claim.

Conclusion

60. Returning to the three issues identified by the parties at the opening of the case, my conclusions are: As to Issue 1, the parties entered a lump sum contract as to Issue 2, I am not persuaded on the evidence that the defendant was obliged to carry out the work other than it did do but even if I am wrong in that, I am not persuaded on the evidence that but for removal of the timber bearers the stud wall would not have required propping in any event. My response to Issue 2 disposes of Issue 3.

ORDERS

1. Judgment for the defendant against the plaintiff.

2. Plaintiff to pay the defendant’s costs.

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Decision last updated: 09 July 2021