B and T Developments (ACT) Pty Ltd And Anors and Act Planning And Land Authority And Anor (Administrative Review)
[2012] ACAT 51
•6 August 2012
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
B & T DEVELOPMENTS (ACT) PTY LTD AND ANORS & ACT PLANNING AND LAND AUTHORITY AND ANOR (Administrative Review) [2012] ACAT 51
AT 110 and 124 of 2011
Catchwords: ADMINISTRATIVE REVIEW – defects in construction: construction not in accordance with approved plans – rectification order – controlled activity order – the function of the Construction Occupations Registrar: public duty, not enforcement of a private contract – cost of rectifying defects
List of legislation: ACT Civil and Administrative Tribunal Act 2008, s.55
Building Act 2004, ss.29, 41 and 42
Construction Occupations (Licensing) Act 2004, ss.35
List or Regulations: Construction Occupations (Licensing) Regulation 2004, Schedule1, part 1.3
List of cases: Jones v Dunkel (1959) 101 CLR 298).
Tribunal: Mr B. Loftus, Senior Member
Date of Orders: 6 August 2012
Date of Reasons for Decision: 6 August 2012
AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL ) AT 11/110 & 124
RE:B & T DEVELOPMENTS (ACT) PTY LTD, B & T CONSTRUCTIONS (ACT) PTY LTD and CORNELIUS HANK VAN ROON
Applicants
AND:ACT PLANNING AND LAND AUTHORITY
Respondent 1
AND:CONSTRUCTION OCCUPATIONS REGISTRAR
Respondent 2
AND:THE OWNERS UNITS PLAN 3324
Party Joined
TRIBUNAL: Mr B. Loftus, Senior Member
DATE: 6 August 2012
ORDER
1.The decisions under review (being the rectification and controlled activity orders made on 18 October 2011 and 3 November 2011) in relation to items 15 and 25 are confirmed
………………………………..
Mr B. Loftus
Senior Member
REASONS FOR DECISION
On 26 March 2007, B & T Developments (ACT) Pty Ltd (‘B & T Developments’) became the registered proprietor of the land then known as blocks 5, 6, 7 and 8 section 27 Forrest. This land subsequently became block 13 section 27 Forrest (‘the Land’).
In 2007 B & T Developments contracted with B & T Constructions (ACT) Pty Ltd (‘B & T Constructions’) whereby B&T Constructions would carry out construction works (a block of units) on the land which became known as the Empire Apartments. Both companies were controlled by Ivan Bulum.
B & T Developments, B & T Constructions and the licensed nominee of B & T Constructions, Cornelius Hank Van Roon, are the applicants in this matter. The respondents are the ACT Planning and Land Authority (‘ACTPLA’) and the Construction Occupations Registrar. The party joined is the corporate body of Empire Apartments. The applicants are represented by Mr Walker of counsel, the two respondents by Mr McCarthy of Counsel and the party joined by
Mr Gavagna, Solicitor.
Background
By a decision dated 16 June 2006, the AAT set aside a previous decision of ACTPLA and remitted the decision to ACTPLA for reconsideration in accordance with its reasons for decision and with directions that the development not be approved unless four stated conditions were met. They are of no particular relevance to this decision. Consequent upon the AAT’s decision, by revised development application dated 23 June 2006 (“DA200406079/B”), Stanic Harding Pty Ltd, on behalf of
Dr Peter Cook, lodged with ACTPLA an amended DA and amended plans for the purpose of seeking development approval in accordance with the AAT’s decision.
By a decision dated 5 July 2006, ACTPLA approved the development on condition that “the redevelopment be carried out in accordance with plans already considered by the AAT together with the following amended plans”, as then identified in condition 8 of the decision.
On 26 March 2007, Dr Peter Cook transferred title in the subject land to B & T Developments.
By application dated 25 July 2007, B & T Developments on behalf of B & T Constructions applied for a minor amendment to the plans as approved by ACTPLA on 5 July 2006.
By a decision dated 15 August 2007, ACTPLA approved the application for the minor amendment to the approved plans.
On or about 22 September 2007, B & T Developments appointed Certified Building Solutions Pty Ltd (“Certified Building Solutions”) as the private certifier for the development to be built on the subject land.
At the time of the development, B & T Developments had two nominees,
Mr Cornelius Hank Van Roon and Mr Ivan Bulum. Of the two nominees, only Mr Van Roon is the holder of an “A” class builder’s licence. The Construction Occupations (Licensing) Act 2004 (COLA) and the Construction Occupations (Licensing) Regulations 2004 (Regulations) authorise holders of class A building licences to carry out all forms of building work, as defined by the Building Act 2004, except for specialist building work and asbestos removal (Regulation, Schedule1, part 1.3, item 1). A class “A” licence is the highest class of building licence. A class “B” licence limits the holder to work no higher than three storeys. A class “C” licence limits the holder to no higher than two storeys.
On 22 September 2007, Mr John Mihaljevic of Certified Building Solutions issued a building approval and building commencement notice to B & T Constructions for construction of the approved development.
Various plans and documents were submitted by Certified Building Solutions to the ACTPLA, which included a roll of engineering drawings prepared by Sellick Consultants Pty Ltd in relation to the development. Copies of the plans were filed by the Respondent as further supplementary materials on 16 February 2012.
By certificate dated 15 April 2009, Mr Mihaljevic provided B & T Constructions with a Certificate of Completion of Building Work.
On 17 April 2009, the Construction Occupations Registrar issued B & T Constructions with a Certificate of Occupancy and Use dated 17 April 2009, based on the Certificate of Completion provided by Mr Mihaljevic on
15 April 2009.
Agreement pursuant to section 55, ACAT Act
The parties have at all times proceeded by reference to 46 alleged defects which are on a list headed Schedule 1 (document T93) A 47th alleged defect is the absence of a water feature depicted on 10302-312 at document T92. For ease of reference in these reasons the list at T93 including the 47th alleged defect (the water feature) is annexed to these reasons.
Before the proceedings commenced many of the items listed were agreed either not to be pressed or to be rectified voluntarily by the applicants. Orders accordingly were made by Presidential Member Spender on 13 May 2012 giving effect to that agreement .
These orders were made following the signing and submission of a consent agreement pursuant to section 55 of the ACT Civil and Administrative Tribunal 2008 (‘the ACAT Act’). They have been subsumed into further consent orders made this day.
In relation to the remaining items on the schedule at T93 all have either been attended to or are not pressed with the exception of items 15 and 25. Further orders are necessary only in relation to items 15 and 25.
Items 15 and 25
These are the only two items remaining in dispute. T93 is a schedule which was attached to the rectification order pursuant to the Construction Occupations (Licensing) Act 2004 dated 18th October 2011 (T85). The rectification order referred to the Schedule at T93 and was directed to the three respondents. At T87, it states-
“The following items in (a) to (n) inclusive relating to the premises identify elements of the premises not built in accordance with approved plans resulting in a building that fails to comply with section 42 (1)(d) (i) of the Building Act
(a) Aluminium/facade cladding replaced with fibre/cement board or rendered/painted finish. See Schedule 1, item15
(k) Translucent glass balustrade inserts are not in place as per approved
plans. See Schedule 1, item 25
The controlled activity order made on the 3rd of November 2011 is to be found at T31 and following. The defect in relation to item15 is stated as follows-
“Aluminium/facade cladding replaced with fibre/cement board or rendered/painted finish
Approved plans specified the use of aluminium stone and polished stone on external elements of the building’s façade. These have all been replaced with either fibre/cement board or a rendered painted finish. See drawings:·0703WD104/a shows aluminium, stone and stone polished panels,
·0312-205/b shows aluminium panels .
·0703wd300 & wd313 shows aluminium panels to sloping roof of lift case as well and stone towards exposed face of corner elements.”
The nature of the non-compliance is said to be that it was not built in accordance with approved plans as a result of the above. This leads to non-conformance with section 42(1)(d)(i) of the Building Act and as a consequence of increasing maintenance costs, creates likelihood of deterioration and having a reduced value effect on the apartments.
The controlled activity order in relation to item number 25 (T53) specifies a defect as pent house balustrade which has not been constructed in accordance with the approved plan. Therefore, the building, it is alleged, is not built in accordance with the approved plans. See, Drawings WD 204 and WD 3004 and others. It is alleged that this is a contravention of section 42(1)(d) of the Building Act and has the consequence of reducing the value and quality of the building. At T27, the intent of the controlled activity order is set out precisely. It is as follows –
“The order requires B & T Developments (ACT) Pty Ltd , B & T Constructions (ACT) Pty Ltd, Mr Cornelius Hank Van Roon, Certified Building Solutions (Pty) Ltd, and Sellack Consultants to comply with the Development Approval Number 200406079 in its entirety.”
Exhibit C is a bundle of approved plans and drawings located under Tab H of the respondent’s further supplementary T documents at page 84. This is Stanic Harding no.0703WD300/A and shows a north-east elevation of the proposed building. Contained in this drawing are the following notes –
· Stone cladding to all exposed faces of corner elements
· Aluminium panel cladding to all exposed faces
· Aluminium
· Clear glass infill to balustrade- This refers to the balustrades of the pent house apartments.
Exhibit C contains no less than 6 references to aluminium composite cladding in addition to the WD 300 drawing at T84. These references are contained in various approved plans at T85, T87, T92, T95, T89 and T70. There is no doubt that it was intended when approved that particular exterior finishes were specified as set out in items 15 and 25.
Mr Walker contended that the party joined (the owners corporation of the units plan 3324) cannot represent the individual unit holders and these, he contends, are those who should be joined. The Tribunal does not agree with this view and in any case it is really irrelevant because the respondents are the decision makers whose decisions are sought to be reviewed. As Mr Walker contended in his submissions there could be an amendment to the plans or new plans could be lodged relating to the two items in dispute, provided the party joined would consent to that amendment. However, the party joined will not consent.
Mr Walker posed the question whether a decision maker has a discretion to make rectification orders and controlled activity orders requiring compliance with contractual provisions or representations. He went on to question whether there is a consumer protection role in the relevant legislation, pointing to section 35 of the COLA as a source of power to make a rectification order and section 351 of the Planning and Development Act 2007 (PDA) as a source of power to make a controlled activity order.
Mr Walker concedes that the Construction Occupations Registrar does have a function which might be labeled “consumer protection”. He argues more accurately it should be called “public protection”. The Tribunal does not disagree with this exercise in semantics but takes the view that the duty of the respondents is more properly described as a public duty to ensure that buildings are constructed in accordance with development approvals and building plans which have been approved. This is not a matter of contract for the enforcement of a private contract. There are other remedies for that. Section 29(1) of the Building Act demands that if plans for the erection or raising of a building. The building if erected or raised in accordance with the plans should comply with the Act. It follows that if it does not comply with the approved plans it does not comply with the Act. It is of no moment that an order made by the respondent might have an incidental effect of requiring something to be done which might have the same as or a similar effect as specific performance in an action in contract. This is not a contract case
Section 41 of the Building Act sets out the requirements for carrying out building work. These inter alia are:
·Materials used must comply with the Building Code of Australia (BCA).
·The way in which materials are used must comply with the acceptable use under the BCA.
·Building work must be carried out in accordance with the approved plans.
Mr McInnes , called upon behalf of the applicant, was cross examined on his witness statement (Exhibit A). It turned out that he had only begun employment in late 2010 with the respondent builder and could not provide any useful comment on the manner in which the project was designed, developed or built. When questioned about the location of the documents relating to the construction, his reply was that they must be kept in “the junk room”, otherwise he was not aware of the existence or whereabouts of such documents. He agreed that in respect of items 25 and 28 the Development Application and Building Approval drawings did not reflect that which was built.
Mr Anthony Hinwood, the financial controller of the group of companies of which the two corporate applicants were members, provided a statement of evidence concerning the organisation of the two companies, (Exhibit D). He did agree that the companies were corporate vehicles controlled solely by Mr Ivan Bulum. He said that Mr Bulum made all decisions in relation to the companies and the projects and that Mr Bulum would be better able to answer questions about those areas. Mr Bulum was not called and no explanation was given for his non-appearance. The inference arises that, if Mr Bulum had been called, his evidence would not have assisted the applicants case. (Jones v Dunkel (1959) 101 CLR 298).
The party joined called Mr Alex Feng to give evidence. Mr Feng is a quantity surveyor and has given evidence in other court proceedings. He was aware of the Code of Conduct for Expert Witnesses and signed an undertaking to comply with that Code. He was accepted as an expert engaged to provide estimates of the cost of rectifying the non-compliance with approved plans that is listed as item 15. He stated in his report (Exhibit G), inter alia, “The DA and BA approved drawings identify the requirement for aluminium composite paneling and stone paneling on specific external architectural elements of the building. Instead of these finishes a 9mm fibre cement panel or a rendered painted finish has been used.” He has estimated the present day cost of rectifying the paneling to that which was approved as $484,926. His report does not take account of the cost of providing glass panels in accordance with item 25. Nor does it take account of the cost of continuing maintenance of what was provided as compared with that which was approved. Mr Feng was not cross examined.
The Tribunal accepts the content of Mr Feng’s report.
Conclusion
The Tribunal is of the view that pursuant to the legislation and its intent the duties of the respondent are principally regulatory. The fact that they may have the ancillary effect of assisting the party joined is of no relevance. Any controlled activity order or rectification order is usually bound to have some ancillary benefit to the owner of the property being built.
The Tribunal is also of the view that notwithstanding that the external finishes (cited in items 15 and 25) are not structural defects but more in the nature of cosmetic defects, nonetheless, they meet the test of being described as substantial for the reasons set out by the respondents in the orders made by them. They are, in the opinion of the Tribunal, so substantial as to justify the orders made by the respondents.
The Tribunal confirms the orders in relation to items 15 and 25 and notes that all the remaining defect items referred to in the decisions under review have been the subject of other orders or do not need any further orders made.
………………………………..
Mr B. Loftus, Senior Member
PUBLICATION DETAILS
TO BE PUBLISHED
To be completed by Tribunal Staff
PART A
FILE NUMBER: |
PARTIES, APPLICANT: |
PARTIES, RESPONDENT: |
COUNSEL APPEARING, APPLICANT |
COUNSEL APPEARING, RESPONDENT |
SOLICITORS FOR APPLICANT |
SOLICITORS FOR RESPONDENT |
TRIBUNAL MEMBERS: |
DATES OF HEARING: |
PLACE OF HEARING: |
PART B
RECOMMENDATION:
FULL REPORT ( ) CASE NOTE ( ) UNREPORTED DECISION ( )
COMMENTS:
1