CMG Homes Pty Ltd v Queensland Building and Construction Commission

CMG Homes Pty Ltd sought review of a decision of the Queensland Building and Construction Commission (QBCC) in the Queensland Civil and Administrative Tribunal (QCAT). The dispute centred on the QBCC’s issuance of a second direction to rectify (DTR) in relation to alleged defects in a property constructed by CMG. The homeowners had previously complained about the works, leading to a first DTR in 2012. After the QBCC decided not to issue a DTR regarding some issues in 2013, the homeowners made a second complaint in 2018. The QBCC subsequently issued a second DTR, which CMG challenged in QCAT.

The key legal issues before the tribunal were whether the QBCC’s decision to issue the second DTR was legally sound and, relatedly, whether the tribunal should award costs to CMG based on the QBCC’s rejection of an open offer to settle the proceedings. The tribunal needed to assess the merits of the QBCC’s decision and consider the appropriateness of the costs awarded to CMG.

The tribunal found that the QBCC’s decision to issue the second DTR was flawed because there had not been a relevant change of circumstances between the two DTRs. The tribunal also held that the QBCC’s rejection of CMG’s open offer to settle was unreasonable and led to a more favourable result for CMG. Therefore, CMG was entitled to costs on an indemnity basis from 11 September 2018. The tribunal outlined a process for assessing and recovering these costs, including an opportunity for the parties to agree on an amount and, if necessary, for assessment by a costs assessor.

The final orders required the QBCC to pay CMG’s costs from 28 May 2018 to 11 September 2018 on a standard basis and from 11 September 2018 on an indemnity basis. The costs were to be assessed according to a specific process outlined in the orders, ensuring that CMG could recover its legal expenses from the QBCC.