DIACONU and WANG
[2018] WASAT 87
•23 AUGUST 2018
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
ACT: BUILDING SERVICES (COMPLAINT RESOLUTION AND ADMINISTRATION) ACT 2011 (WA)
CITATION: DIACONU and WANG [2018] WASAT 87
MEMBER: MS H LESLIE (MEMBER)
MR C MARSH (SESSIONAL MEMBER)
HEARD: 22 - 24 MAY & 26 JUNE 2017
DELIVERED: 23 AUGUST 2018
FILE NO/S: CC 1546 of 2016
BETWEEN: TIBERIU LAURENTIU DIACONU
Applicant
AND
CAROL CHUNFENG WANG
Respondent
FILE NO/S: CC 892 of 2016
BETWEEN: CAROL CHUNFENG WANG
Applicant
AND
TIBERIU LAURENTIU DIACONU
Respondent
Catchwords:
Faulty and defective workmanship - Breach of contract - Variations - Termination of contract - Alternate civil claims - Jurisdiction - Retention of tools and materials - Penalty hire costs
Legislation:
Building Services (Complaint Resolution and Administration Act) 2011 (WA), s 5, s 5(1), s 5(2), s 11(1), s 36(1)(c), s 41(2)(b)
Home Building Contracts Act 1991 (WA), s 17, s 20, Sch 1 cl 5Result:
Applications both successful in part only
Builder to be paid for unpaid work completed including several agreed variations and owner to be compensated for faulty and defective work
Other claims dismissedCategory: B
Representation:
CC 1546 of 2016
Counsel:
Applicant : In Person Respondent : In Person Solicitors:
Applicant : Respondent : CC 892 of 2016
Counsel:
Applicant : In Person Respondent : In Person Solicitors:
Applicant : Respondent : Case(s) referred to in decision(s):
NilREASONS FOR DECISION OF THE TRIBUNAL:
Applications
1Three applications were referred to the Tribunal by the Building Commission under s 11(1) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA) (BSCRA Act), arising out of a contract between the parties for the construction of a second and third story addition (the works) to a residential property (the property).
2The property is a terrace house which, prior to the works, comprised three stories (ground, first and second storey) at the front, two stories in the midsection (ground and first storey) with a courtyard behind and then a single storey garage (ground storey only) accessed from a rear laneway. The works involved the construction of an additional (second) storey area in the midsection (above the ground and first floors) to enlarge the top floor by the additions; an additional (first) storey above the garage and, lastly, the construction in the courtyard of a multilevel 'bridge section' above part of the courtyard to provide firstly, a built-in walkway at first floor level (from the house to the above garage rooms) that incorporated a bathroom and some storage areas and, secondly, a covered walkway at the second storey level (to allow access from the top floor extension to an outside lift to be installed adjacent to the garage in the courtyard.
3Two applications are made by Ms Carol Wang, (the owner), against Mr Tiberiu Diaconu (the builder). They were numbered CC 892 of 2016 and CC 1829 of 2016 but have been consolidated into one matter to be referred to as CC 892 of 2017. The other matter CC 1546 of 2016 is an application by the builder against the owner.
4The applications arise out of complaints made under s 5(1) and s 5(2) of the BSCRA Act by the owner firstly, that the regulated building service provided by the builder was not carried out in a proper and proficient manner or is faulty or unsatisfactory and secondly, for breach of contract; and, under s 5(2) of the BSCRA Act by the builder for breach of contract.
The claims
The owner's claim
5At a directions hearing earlier in the proceedings, the owner withdrew a number of her complaints relating to disciplinary issues (as opposed to contractual or workmanship issues). Items 0, 12, 13, 15, 16 and 17 of her Scott Schedule were accordingly struck out.
6The owner's claim is that she lawfully terminated her contract with the builder prior to the completion of the works. Thereafter, she had the works completed and had what she claims were 'defective works done by the builder' remedied by third party contractors engaged by her whom she has paid (save as to one minor component). Her evidence is that the completion work and the remediation work were all finished by approximately April 2017. Her claim is essentially for damages in relation to the third party payments required to be made by her. The claim is in three parts.
7Firstly she claims the cost of work required to bring the works up to the point of completion for which she says she has paid, namely the completion of the 'walls up' stage of the works, this being a claim for breach of contract. That claim is for approximately $92,000 based, she says, upon her quantity surveyor's estimate. As part of this first aspect of the claim, the owner claims an additional amount of approximately $8,000 being electrical works undertaken by her as part of the completion of the works not included, in error, in the quantity surveyor's figures.
8Secondly, she claims the cost of remediation of damage to part of the existing property, being water damage and collapsed ceilings in two first floor rooms and a bathroom, caused, the owner says, as a consequence of the faulty or unsatisfactory workmanship by the builder in relation to roof plumbing works performed above, this being a claim for faulty workmanship. That claim is for approximately $40,000 based upon the quantity surveyor's estimate.
9Thirdly, she claims the cost of remedying work performed by the builder in a faulty or unsatisfactory way, this being a claim for faulty workmanship. She also claims further related costs incurred by her, in particular bank interest, by reason of the builder's breach of contract. That total claim is for approximately $35,000.
10The total claim is thus for approximately $175,000.
11The builder disputes the owner's claim either in contract or on the basis of faulty and defective workmanship. He agrees that the works were unfinished when he left the site. He claims that he was unlawfully prevented from completing the contract by the owner.
The builder's claim
12The builder's claim is in six parts.
13Part 1 arises out of six alleged contract variations which he claims were agreed with the owner and completed by him and which required payment of additional funds over and above the original contract price. He says that the owner has not paid him for these variations. The total of these is $36,621.05. This is a claim for breach of contract.
14Part 2 arises out of a claim for the loss of the value of tools, signage and equipment owned by him that he says the owner would not allow him reasonable opportunity to retrieve from the site. He seeks their return or compensation to an equivalent value (said by him to be in the total sum of $4,205.91).
15Part 3 arises out of a claim for the loss of the value of materials owned by him that he says the owner would not allow him reasonable opportunity to retrieve from the site. He seeks their return or compensation to an equivalent value (said by him to be $5,540.25).
16Part 4 is a claim for $6,000 in scaffolding hire fees he says he was required to pay to a third party because the owner would not allow timely access to retrieve the hired scaffolding from the site.
17Part 5 is a claim for $57,580 in unpaid work. The builder claims that the walls were up and that stage six of the works (render and plasterboard) was well underway in fact that the whole project was 85% complete - at the time he left the site. This is a claim for breach of contract.
18Part 6 is a claim for $25,982 being work performed by the builder and required to be done by reason of what he said were differences between the plans approved by the local government authority and the plans the owner gave him to quote on, in particular the use of double brick in boundary wall sections where he believed he was quoting for brick veneer construction. This is a claim for breach of contract.
19The total of his claim is therefore $134,330.21.
20The owner disputes that she owes the builder any funds.
Evidence
21A substantial quantity of documentation was put in evidence in the form of hearing books volumes 1, 2 and 3 to be referred to as Exhibits 1, 2 and 3. Scott Schedules detailing the components of the claims were filed by both parties. The owner's documents include extracts from what the Tribunal accepts was a contemporaneous 'electronic diary' recording the progress of the project.
22It is also to be noted that both parties purported to refer to documents not put into evidence which were said to corroborate their oral evidence. The Tribunal places no weight on such evidence.
The owner's case
23The owner gave evidence as, to some extent, did her partner Mr Wayne Slender. She called three expert witnesses Mr Richard Machell (of Prescient Consulting) who has building expertise (his report is dated 4 October 2016 and appears at pages 334 75 of Exhibit 3), Mr Neil Butler who is a quantity surveyor (whose report appears at pages 123 - 144 of Exhibit 3) and Mr Rod Harris (of Building Industry Advisory Service) who also has building expertise and whose report appears at pages 57 - 73 of Exhibit 3.
Mr Harris
24Mr Harris, who has 35 years' experience in the building industry, attended the owner's property on 11 May 2016, the day before she terminated the contract with the builder. His evidence was that he spent about two and half hours at the property. His is the only report done prior to the undertaking of any works by the owner or her tradesman after the builder had departed the site. Mr Harris' evidence is that the reason for his visit was that the owner 'just wanted to know how safe the structure was at the time and what was involved'. He confirmed that his report was in the nature of 'a quick and superficial overview with some ballpark figures attached'. He agreed that there isn't 'a lot of text details but we (sic) rely a lot on the photographs'. He confirmed that the report was 'only a preliminary report' stating 'If she needed more detail to go further, I would have come back and done another one'. He confirmed that his 'ballpark figures' were not put forward as a detailed estimate of the cost of works needed.
25The Tribunal accepts Mr Harris' report as no more than what he has described, namely, an indication to the owner of the position she was in. Certainly, in the view of the Tribunal, there is insufficient detail contained in the report for it to be relied on as an analysis of works required or of faults and defects or of the costs involved in completing or remedying any deficient work. The Tribunal accepts Mr Harris' evidence that, if this were what the owner had been seeking from him, he would have had to return to do a more detailed report.
Mr Machell
26Mr Machell is an independent building expert. His expertise was not the subject of challenge in the hearing. His report dated 4 October 2016, prepared following two inspections (5 August and 6 September 2016) is in evidence.
Mr Butler
27Mr Butler is an independent quantity surveyor. His expertise was not the subject of direct challenge in the hearing. His report dated 25 November 2016 prepared following a site inspection at the property on 17 August 2016 is in evidence.
28All experts were questioned by the Tribunal and the builder.
29The owner also relied on the report prepared by Goodison Engineering in March 2016 to which reference will be made and which report appears from pages 138 142 of Exhibit 1. Mr Goodison was not available for questioning. The Tribunal is therefore not able to place much weight on his report.
The builder's case
30Mr Diaconu gave evidence. He relied upon:
•three reports (SM 1, 2 and 3) from Mr Steve Mladenovski, a registered builder (of Ausmak Holdings Pty Ltd, a construction consultancy);
•three reports (PM 1, 2 and 3) from Mr Paul McEvoy (a director of Rawlinsons (WA), a quantity surveying and construction costs consultancy);
•two reports (FP 1 and 2) from Mr Farid Popal (a registered building practitioner); and
•two reports (JC 1 and 2) from Jaydec Constructions, registered builders.
31[The reports all appear in the evidence books]. Only Mr Mladenovski was called at the hearing to be questioned upon his reports. None of the builder's other expert witnesses were available to be questioned. The Tribunal is unable therefore to place much weight on their evidence.
Mr Mladenovski
32Mr Mladenovski is a builder. He has provided three reports to the Tribunal. The second report purports to contain remediation costings estimates. The other reports purport to contain evidence regarding the liability issues in the dispute.
33The first two were prepared without inspection of the property and solely on the basis of information provided by the builder. His third report was prepared following an inspection of the finished property after completion by the owner.
34Mr Maladenovski was called to give evidence regarding remediation costings and to speak to his reports. It is to be noted that he qualified his report in his evidence as set out later in these reasons.
The state of the evidence generally
35The parties respectively bear the onus of satisfying the Tribunal on the balance of probabilities as to the matters they allege in their respective claims.
36The antipathy between the parties was quite apparent to the Tribunal. In the view of the Tribunal, it adversely affected the quality and reliability of their oral evidence and the case presentation. Both generalised and made broad statements critical of the other. Neither appeared to be able to give a direct answer to a question put by the other. Both obfuscated and at times gave contradictory answers to the questions from the Tribunal. Neither impressed as a particularly reliable witness.
37Even allowing for the fact that the parties were self-represented, neither was well prepared for the hearing. Both claimed to have 'evidence' to answer all issues but conceded that much of this was not lodged with the Tribunal.
38It has been difficult for the Tribunal to determine where the truth lies where there are matters of fact in issue. Much of the parties' oral evidence was directly contradictory. The matters referred to made it difficult to tease out the contradictions by questioning in the hearing.
39As a consequence, the Tribunal has placed considerable weight on the available documentary records put into evidence as corroborative of the course of events and the matters agreed (or not agreed) by the parties. As will be referred to, the fact that much of the expert evidence has been based on information provided by the respective parties to the experts well after the termination of the contract rather than on observations made by the experts themselves contemporaneously with the ending of the contract, has made the matter more difficult. Although understandable it was unhelpful from an evidentiary point of view that the owner pressed on with building works on the site after the exit of the builder without a comprehensive independent inspection and report.
Issue 1 builder's claim regarding double brick boundary walls (builder's claim part 6)
The contract
40There is contradictory evidence as to the precise content of the contract. An analysis of the history between the parties, much of which as set out herein is not in dispute, is necessary.
41The owner's evidence is that, having approached the builder with what she called 'initial concept drawings', being an eight page set of drawings labelled 'Proposed Additions Planning Application' and dated 27 October 2014 (Exhibit 5), she rejected a quotation for the project provided by the builder dated 20 January 2015. The specification/quote document (SQ1) is in evidence. The exchange of emails appears as the first page of Exhibit 6. It is common ground that the Exhibit 5 initial concept drawings are the ones upon which the builder prepared his first quote.
42Some months later, on 25 April 2015 the owner received approved drawings (WD1) from the relevant local government authority (the LGA). She proceeded to enter into a contract with an alternative building company (RBG). This contract was however terminated by agreement in its early stages. Looking for a new builder, the owner again approached the builder to see if he could better his January (SQ1) quote. Her evidence is that he asked her to forward the drawings and the RBG quotation for him to consider. Her evidence is that she forwarded to him the then approved WD1 and the associated engineering drawings (ED1) together with her requirements in order to get an accurate quotation from him. The exchange of emails appears as the second page of Exhibit 7.
43The builder disputes that he received the approved WD1 and ED1 from the owner at this time. He disputes having received the email attaching the WD1 that appears on the last page of Exhibit 7. He claims to have worked from the initial concept drawings sent to him at the time of his first quote, having requested from the owner only details of the 'lowest quote you have at present and (sic) respective specifications'. He claims to have had a telephone discussion with the owner at the time in which she assured him that the approved drawings were the same as the initial concept drawings he had quoted on in SQ1.
44The builder provided a second specification/quotation document (SQ2). The quoted price was some $50,000 less than the first price and it was accepted. It is to be noted that SQ1 and 2 are in some respects different.
45On 12th May 2015 the parties signed a standard form Master Builders Association of Western Australia home building works contract (a copy of which is in evidence) and a copy of SQ2.
46It is not disputed that, at the time, there was discussion between the owner and the builder about a change in the design to replace a courtyard spiral staircase with a lift (the lift alteration). It was agreed to progress this matter at a later stage. It is the owner's evidence that the WD1 were drawn with the relevant portion of the courtyard wall built as a double brick wall to support the future lift alteration.
47It is to be noted that, somewhat unusually, a set of plans was not initialled and included as part of the bundle of contract documents. Nor was there any Addenda to Specifications document ever prepared or signed.
48A further complication is that there appears to have been three socalled specification documents in the bundle of documents provided by the LGA with the building permit as described below. These three are contained sequentially in Exhibit 4 (to be referred to as Exhibits 4.1, 4.2 and 4.3).
49Exhibit 4.3 appears to be a specification provided by RBG when that company was involved in the project earlier. (It is noted that Exhibit 4.3 refers throughout to an Addenda to Specification document. It is unclear if such a document was ever brought into existence between RGB and the owner. It was certainly not put into evidence). Exhibit 4.3 appears to have been signed by both the owner and RGB on 6 March 2015 and, from the stamp affixed to each page of the document, to have been lodged with the LGA approvals department for approval on 24 March 2015. It appears from the stamp affixed to the front page of the document that it forms part of the bundle of documents approved with a building permit (No 15-167) issued on 20 April 2015 (one assumes to RBG although a copy was not put into in evidence). Although it is not clear why, it appears from a further 'application accepted' stamp affixed to Exhibit 4.3 that it was lodged a second time, on 15 May 2015, when the subsequent permit was sought for the builder to take over from RBG.
50Exhibit 4.1 is the specification provided by the builder and signed by both parties on 12 May 2015 (SQ2). It appears from the stamp affixed to each page of the document, to have been lodged with the LGA approvals department for approval on 15 May 2015. It appears from the stamp affixed to the front page of the document Exhibit 4.1 that it forms part of the bundle of documents approved with a building permit (still numbered No 15-167) issued on 22 May 2015 to the builder.
51Exhibit 4.2 is of uncertain provenance. Each party denies responsibility for it. It appears, from an examination of the document and, in particular the paler appearance of some of the stamps on the document, to be a colour photocopy of Exhibit 4.3 save that on the front page, prior to the photocopy being made, the name 'RBG Builders' appears to have been blanked out (with correction fluid or similar) with the builder's name and reference written in handwriting. Further, on the back page, the signature of the RBG representative appears to have been blanked out and the builder's signature appears. There is no new date or new witnessing signature. The date and witness signature and all the affixed council stamps appear to be from the original RBG document (Exhibit 4.3).
52The builder agreed that the handwriting is his where the name and reference are written in and that the signature is his. He denies having inserted either on this version of the specification or having signed it and, by implication, seems to be suggesting that they have been inserted by another party by copying, cutting and pasting or similar. The owner denies any knowledge of the document or involvement in such action.
53On 13 May 2015 the day after the contract was signed, an application for a building permit was completed by the builder. On page 2 of the application, the builder has checked the option showing the exterior walls are to be built in brick veneer with the wall frames in timber. Although he did not dispute completing and signing the relevant form, the builder's evidence was that he did not lodge the application for a building permit; rather, that the owner did, and that he only received copies of the approved documents from the council after the 22 May permit approval was granted.
54He says that the bundle that he received included, confusingly, all three 'specifications' (Exhibit 4.1, 4.2 and 4.3) all stamped as referring to the building permit 15-167. It is to be noted however that only Exhibit 4.1 is stamped as approved 22 May 2015. Exhibit 4.3 is stamped approved 20 April 2015. Exhibit 4.2 appears to be stamped the same although the stamp is likely not original but rather to be part of the photocopied document that was 'doctored'.
55It is unclear what if any use was made of Exhibit 4.2. Neither party appears to rely on it. It is unclear if anything turns on it, other than as an indicator of the unorthodox and unsatisfactory state of the paperwork and level of trust between the parties.
56It is common ground that the binding specification as between the parties is Exhibit 4.1 (SQ2). The builder insists that the others are relevant as an indicator of the confusion and difficulty that surrounded the job and, by implication, the lack of clarity about what the contractual terms were.
57The contract provides in clause 1 that 'the builder will complete the Works shown on the Drawings and described by or referred to in the Specification and elsewhere in the Contract Documents' in consideration of the payment to him of the specified contract price.
58In clause 36 of the contract, the 'Contract Documents' are defined as 'this Agreement, Conditions, Particulars of Contract, Appendices, Drawings and Specification and any incorporated documents' and the Drawings and Specification are defined as 'the Drawings and Specification referred to in the Particulars of Contract'.
59Unfortunately, the Particulars of Contract as inserted in the contract document are deficient. 'Works' is defined as 'second/third storey addition to existing dwelling as described in the following Contract Documents: … '. There follows a section for the completion of both the particulars of the Specification and a section for the completion of particulars of the Drawings including details of who prepared the documents, the number of pages, relevant sheet numbers, date et cetera. This section of the document is left blank with no particulars inserted.
60As stated previously, it is agreed however that SQ2 is the relevant specification document.
61SQ2 provides in clause 1 that 'the builder will build the house as per architectural drawings and engineers details'. In clause 5, it provides that 'external brickwork as per plans. Matching the existing brickworks'. The words 'brick veneer' do not appear.
62The builder claims that he was tricked by the owner. He says he only became aware that what he had thought was to be brick veneer, was in fact to be 'double brick' subsequent to being provided with the full suite of contract documents by the LGA after the approvals were granted. He concedes that this was approximately a week after the date of the contract, that is, about midMay 2015.
63There followed various pieces of correspondence where the builder, who by then appears to have realised that his quote did not match the approved plans, sought to persuade the owner to resubmit amended plans showing brick veneer boundary walls in line with his costings. The owner maintained that the approved drawings had always shown double brick walls, that was what had been contracted on and approved by the LGA and the builder was bound by his quote.
64It is noted that the builder did not at this time requote and produce a variation reflecting his alleged misunderstanding.
65There is some contradictory evidence as to the precise course of events.
66On 22nd May 2015 a building permit was issued for the builder to build (the first building permit). It appears to have been issued on the basis of the WD1. Although the builder insists he quoted on the initial concept drawings and not on the WD1 that were ultimately approved, no issue was taken that these plans were the first approved plans attached to the first building permit issued to the builder.
67On 9 June 2015 the owner paid the deposit/first progress payment being $20,770. It is common ground that this was paid as an initial cash payment of $18,882 with the GST being paid later. An explanation was provided as to why it and some subsequent payments were made this way. It is unclear if anything turns on this other than as an indicator of the unorthodox and at times unsatisfactory way in which the parties dealt with each other.
68On 7 July 2015 the owner paid the second progress payment (called 'the preliminaries') being $40,000 (again paid as an initial cash payment, this time of $36,363 with the GST being paid later).
69The owner's evidence is that in the initial months the builder was hard to contact. It is undisputed that he was overseas at this time for a period. There were then some discussions about waiting until after the winter and to extend the completion date. She says she was 'resigned to wait'. In the meantime she decided to progress the application for building approval for the lift alteration. Her evidence is that the designer advised that the courtyard lift would be better located against the garage wall rather than in the position against the back of the house previously occupied by the spiral staircase, and that this would in fact be less work for the builder. Her evidence is that she was ultimately able to get hold of the builder, who was overseas, by telephone. She stated that throughout the whole process of applying for the second building permit to accommodate the lift alteration, the parties were in agreement that relocating the lift would not incur additional costs, and that no variations were agreed, but that as a gesture of good faith, she agreed to meet a designated proportion of the cost of the lift footing.
70Work eventually started on the site on 23 October 2015. It is noted that at this time, the builder had still not requoted and produced a variation reflecting his alleged misunderstanding regarding the boundary wall double brick requirement.
71On 29 October 2015, the builder emailed the owner as follows:
[the city of Perth building surveyor] suggested that maybe now, before he is considering the [second building permit] application and work on it, you should change the plans from double brick into brick and studs. … So the new amended architectural drawings (with lift) will show brick and studs, and will be in accordance with the engineering drawings.
72On 3 November 2015, he further emailed 'As we have discussed, the new structure will be brick veneer as per technical drawings'.
73There is no evidence of a formal response from the owner.
74On 31 October 2015, the owner paid the third progress payment called ('demolition') of $20,000 (again paid as an initial cash payment of $18,882 with the GST being paid later).
75The second building permit incorporating the lift alteration was issued in the name of the builder on 3 November 2015. It is not in dispute that the only change related to the lift alteration.
76The approved amended drawings all appear in the evidence. Again, although the builder insists he quoted on the initial concept drawings and not on the WD1 that were initially approved, no issue was taken that the WD2 was the amended approved plans attached to the second building permit.
77It is agreed that WD1 and WD2 are both sets of plans approved by the council for the purposes of building approval. Both they and the engineer's drawings provide that the external boundary walls are double brick.
78It is accepted that, although there is no key on the drawings, the concept drawings are consistent with the boundary walls being in brick veneer.
79On 18 December 2015, the owner paid the fourth progress payment called ('first and second floor') of $20,000 (also paid as an initial cash payment of $18,882 with the GST being paid later).
80The owner's evidence is that throughout the building process there were numerous issues, difficulties with communication, problems in the relationships, issues with the builder not being on site and with the quality of work done. It appears that the builder threatened to terminate the contract on a number of occasions early in 2016.
81On 16 December 2015 the boundary wall issue came up again. In her electronic diary, the owner noted at this point '2ⁿᵈ level floor almost done. Boundary walls partly erected with Timber instead double brick'.
82On that day, she emailed the builder refusing to sign a variation presented to her replacing double brick on the boundary walls with brick veneer. She stated:
You previously informed me that there are conflicts between Loretta's working drawings and Darren's engineering drawings that engineering drawings show brick veneer. I have clarified this with Darren he confirmed as his original words: In regards to the east and west boundary walls on the first floor over the garage. The structural drawings currently shows (and has always shown) brick cavity i.e. internal and external leaf of brick wall.
83In his email in response the builder appears to concede that the engineering drawings showed double brick ('Indeed, the engineering showed double brickwork'.) He goes on to say 'I trusted you, that's okay, I'm the loser. Next time I'll be more attentive when trusting people. Is all good. You may dismiss my "erroneous request" but you can never dismiss the truth. But is ok, I'm the loser and I accept it'. Although apparently accepting her position, he continues to insist that a double brick wall will incur extra payment.
84It appears that the builder threatened to terminate the contract in February 2016.
85On 1 March 2016, the owner paid the fifth progress payment called ('walls up stage') of $80,000 (inclusive of GST). As is evidenced in her complaint to the Building Commission, she claims to have done so in good faith, claiming that this stage had not been completed at the time of payment but in fear that if she did not pay, the builder would stop work. At or about this time it appears she drew down against her mortgage and also paid to the builder the GST due and owing on the first four payments. To this point, the total paid by her was $180,000 of the $335,770 contract.
86Issues continued. Each party blames the other. It appears from the documents that, early in March, the builder suggested that the parties agreed to walk away from the contract amicably.
87The owner's evidence is that, at this point, notwithstanding the content of the approved drawings, the builder had constructed the boundary walls in brick veneer rather than double brick and that there were other issues with the work. Ultimately, the builder redid the disputed boundary wall brickwork in double brick and now seeks to claim this as an item additional to his quote.
88On 23rd March 2016, the builder stopped work pending a resolution of a number of issues.
89The owner commissioned an engineering inspection and report on the partially constructed building from Goodison Engineering (who were the design engineers for the project) which report has been earlier referred to. That report refers to 'general compliance by the builder' with the engineering requirements albeit there were a number of items that required attention. The owner's evidence is that the builder 'abandoned' the work on 1 April 2016. The builder disputes this although he accepts that work stopped at about this time.
90On 7th April 2016, the owner served a Notice of Proposed Complaint to the Building Commission upon the builder. Receiving no acceptable response, she then sought legal advice in an endeavour to get the works completed by the amended completion date 23 May 2016, (being seven months as originally agreed from commencement). It appears from the documents that, despite some initial exchanges and a meeting, an agreement was not able to be finalised. At that point the owner determined to terminate the contract and issue the appropriate notice of intention which she did by letter on 2 May 2016. On 9 May 2016 she submitted her first complaint to the Building Commission. On 11 May 2016, she had Mr Harris inspect the site and on 12th May she formally terminated the contract.
91Seemingly in response, by letter to the owner dated 18 May 2016, the builder purported to 'suspend works'. He says that he was unlawfully refused entry to the site to complete the works.
92Months later, following a second inspection by Mr Machell, new items of defective workmanship were claimed by the owner. She then instituted a further complaint with the Building Commission which was fast tracked and referred to the Tribunal and ultimately consolidated with her original complaint.
Disputed contract variations
93The owner's evidence is that after the escalation in the dispute, in response to her lawyer's letter to him, the builder produced the six disputed variations. The owner's position in relation to the first four of these later variations is that she did not request or agree to agree to any such variations and, additionally, the work referred to in each of the variations has in fact not been done. In relation to the two variations which relate to the installation of sarking in the roof, although she agrees there was a discussion about the installation of sarking, she disputes that it was ever suggested that this would involve additional cost over and above the contract figure.
Findings in relation to the Contract
94The Tribunal accepts the evidence of the owner that the builder was provided with the approved WD1 and ED1. It rejects the evidence of the builder that he did SQ2 on the basis of the initial concept drawings only and was 'tricked' by the owner. The Tribunal accepts the owner's evidence of her having emailed WD1 and ED1 to the builder and rejects the builder's evidence that he did not receive that email.
95The initial concept drawings do not have complete dimensions. Nor do they have a key to assist in the reading and interpretation of the drawings. Although it is conceivable that the drawings could have been read as showing boundary walls in brick veneer bearing in mind the drawing style is adopted, they do not specifically identify the wall type. When asked by the Tribunal how a quote could be prepared on such drawings, the builder explained his quotation method as follows:
… They are very very clear plans which can be seen and when it's about giving a price, for this kind of work it's impossible to work on quantity because, you know, quantity surveyors who have so many variations so we usually work like the square metre and it's like a a kind of like gut feeling as well …
96In the view of the Tribunal, it is implausible that a builder acting professionally would prepare a quote for a job of this size and significance knowing that approved plans existed without having the full measurements and without having seen the full set of approved drawings. In the exercise of proper and proficient building practice, the builder would reasonably be expected to pay appropriate attention to the detail of the approved plans in preparing the quote. If he has failed to do so, then it is on his own head.
97The Tribunal finds that on 12 May 2015 the builder contracted to complete the extensions and renovations as described and illustrated in the drawings that are WD1 and ED1 and the specification that is Exhibit 4.1.
98The contract document is in evidence. The substance of the contract is that, in exchange for the payment of a designated sum of money,
… the builder will complete the Works shown on the Drawings and described by or referred to in the Specification and elsewhere in the Contract Documents.
99The definitions clause of the contract, clause 36, defines Drawings and Specification to mean 'the Drawings and Specification referred to in the Particulars of Contract'.
100In addition, the explanatory notes attached to the contract caution the parties that:
The Particulars and Appendices should be completed in full. Each page of the Specification should be initialled and the Specification dated and signed where indicated. Each sheet of the Drawings should be signed, dated and marked [as per the example given].
101Notwithstanding, in the Particulars of Contract (appearing at page 5 of Volume 2), details of what constitutes 'the Specification' are left blank as are details of what constitutes 'the Drawings'.
102Both parties allege reliance on oral representations by the other as the basis for each of them failing to adequately read the documents.
103The Tribunal is satisfied on the evidence of the owner, which the Tribunal accepts as credible, that the owner sent the WD1 approved drawings to the builder prior to the preparation of his second quote. These drawings have the boundary walls as being double brick walls.
104The Tribunal is satisfied, indeed it is agreed that, SQ2 is the specification that the builder sent to the owner with his quote. The property is a terrace house and, to that extent, the side walls of the house are boundary walls. The quotation does not specifically refer to the 'boundary walls' nor does it use the term 'brick veneer'. To the extent that it refers to the construction of walls, the following items of the specification are relevant:
1. PRE-START DESCRIPTION OF WORKS
These Specifications are to be read in conjunction with the future contract. The Builder will build the house as per architectural drawings and engineer's details. (Tribunal emphasis)
6. BRICKWORK
External brickwork - as per plans, matching the existing brickwork. The builder and owner will work together towards using the matching bricks, however it will be slight variations. (Tribunal emphasis)
Internal walls - timber studs framework and plasterboard.
105In the view of the Tribunal, the parts of items 1 and 6 above emphasise interpretation of the specifications by reference to the plans. If there is any doubt about this, the contract itself provides a mechanism for the resolution of discrepancies and ambiguities. Clause 3(d) which appears at page 16 of Exhibit B allows for resort to be had to the plans in resolving any lack of clarity or ambiguity in the specification.
106It may be that the builder has misinterpreted or failed to pay adequate attention to the disputed aspect of the design as shown in the plans. That is consistent with him having completed the building permit application (which appears at page 169 of Exhibit B) on 13 May 2015 and ticking the box 'brick veneer'. However, in the view of the Tribunal, he is bound by the terms of the contractual documents, in particular the plans, which, in the view of the Tribunal make it abundantly clear that the boundary walls were always intended to be double brick and the contents of which he either had notice of or ought to have had notice of since they had been sent to him.
107In the view of the Tribunal, the builder is not entitled to claim any further sum on top of his quoted figure for the provision of the double brick boundary walls. His claim in this respect fails.
Issue 2 faulty and defective workmanship claim (part of the owner's third claim)
108The owner claims the cost of remedying faulty and defective workmanship by the builder in the new work done.
109She bases her claim on firstly, the estimates provided by Mr Butler in schedule A to his report which he states is 'the appropriate cost of remedying the defects identified in paragraph 6.8 [a y]' of Mr Machell's report (the defects list). His total figure is $23,659.30. Mr Machell attended and spoke to his report and answered questions put to him by the builder and the Tribunal.
110The builder's case is that all but six of these items (being a, b, m, n, o, and p which he agrees constitute defective workmanship) are incomplete items of work rather than faulty or defective work.
111However, he called no independent expert in relation to the question of whether the items referred involved faulty or defective workmanship and relies solely on his own evidence and his questioning of the owner's expert.
112In the circumstances, other than to the extent mentioned hereunder, the Tribunal accepts Mr Machell's evidence on the defects, and rejects that of the builder.
The defects list - 25 items: (a) (y)
Item (a)
No/inadequate fixings to the wall plate of the 1 floor level corridor between the existing house and the garage extension have been installed and where floor and frame is installed and temporarily supported by timber posts.
Recommendation: Jack up floor to required height and fix to wall.
113Mr Machell rejected the suggestion that this was unfinished work. He claimed that where a wall plate is subsequently used to support flooring, as this one was, then it should have been fixed adequately at the time of installation rather than for the wall plate to be put up on props, putting the floorboards on, putting the floor joists on and then fixing the wall plate. In his view the latter was the wrong sequence and represented defective work.
Finding:
114The Tribunal accepts Mr Machell's evidence that the work is faulty.
Item (b)
… Joist blocking to garage floor joists … not installed per Structural Engineer requirements and [Australian Standards …]. [He observed] blocking is installed at nominally 2.9m centres and only at the ends of joists.
Recommendation: Install additional blocking between joists on either side of the central beam in the floor in accordance with [the relevant standard].
115Again Mr Machell expressed the view that the work was defective not incomplete. Although conceding that 'it's a bit of a moot point in some respects', he expressed the view that to be proper and proficient, the work should be done in proper sequence that stabilised the works that were subsequently carried out; that the joist blocking should have been done before the floor load goes down.
Finding:
116The Tribunal accepts Mr Machell's evidence that the work is faulty.
Item (c)
Head flashings and weep holes above windows and doors in cavity walls over the garage … are not installed, contrary to [the relevant standard].
Recommendation: Install flashings and weep holes in accordance with [the relevant standard].
117Again Mr Machell indicated that the flashings and weep holes should have been installed as the works progressed in the proper sequence; that although they could be installed later, this is not the correct order of things.
Finding:
118The Tribunal accepts Mr Machell's evidence that the work is faulty.
Item (d)
A through flashing is not installed at the double wall at the rear of the lift or at the East boundary wall, contrary to [the appropriate standard]; and (sic) where the external wall above the roof becomes an internal wall below the level of the roof. The engineering drawings at 1/9 note 4 requires parapet flashings to be over walls whereas the architectural drawings require the walls to be face brickwork and which is inconsistent with the Structural Engineers requirements. This item if not faulty is incomplete.
Recommendation: Install over flashings and cappings to wall in accordance with [the relevant standard].
119Mr Machell agreed that the question of whether the work was faulty or incomplete depended upon whether the intention all along had been to put in an over flashing or capping rather than a through flashing. He agreed that the work would only be faulty if it was not going to be capped; implicitly that it would otherwise simply be incomplete.
Finding:
120The Tribunal's view is that the owner has not established that this item of work is faulty or otherwise not proper or proficient.
Item (e)
A flashing in the cavity brick walls at suspended floor level and where the cavity is not otherwise maintained, at the garage and at the main building, is not installed and weep holes are not installed externally, contrary to [the applicable standard].
Recommendation: Install flashings to wall in accordance with [the relevant standard].
121Mr Michel's evidence was that a damp proof tray needs to be installed to divert water in the face brick to the outside of the building, with weep holes above the head of the garage. He said a failure to do this was defective workmanship
Finding:
122The Tribunal accepts Mr Machell's evidence that the work is faulty.
Item (f)
An adequate cavity (not less than 35mm …) in the parapet wall on the boundary is not installed. The engineering drawings at 1/9 note 4 requires parapet flashings to be over walls whereas the architectural drawings require the walls to be face brickwork and which is inconsistent with the Structural Engineers requirements. This item if not faulty is incomplete.
Recommendation: Install linings to walls in accordance with the [relevant standard] … and to ensure that the [National Construction Code] is otherwise complied with in respect to … Weatherproofing
123Mr Machell stated that the cavity in the wall was insufficient to provide the necessary waterproofing effect. He commented that 'there's no details on the drawing that [capping] was supposed to happen here'. He agreed that if the intention had been to appropriately cap the wall and waterproof it, he would regard the work as unfinished. If those things were not going to happen and it was to be left in the condition photographed by him, he would regard the work is defective.
Finding:
124The Tribunal's view is that the owner has not established that this item of work is faulty or otherwise not proper or proficient.
Item (g)
An adequate cavity (not less than 35mm …) at the rear of the lift, is not installed. The engineering drawings at 1/9 note 4 requires parapet flashings to be over walls whereas the architectural drawings require the walls to be face brickwork and which is inconsistent with the [Structural] Engineers requirements. This item if not faulty is incomplete.
Recommendation: Install linings to walls in accordance with the [relevant standard] … and to ensure that the [National Construction Code] is otherwise complied with in respect to … Weatherproofing
125Mr Michel confirmed that similar capping and waterproofing needed to occur. His comment as to whether the work as unfinished or defective is as for (f).
Finding:
126The Tribunal's view is that the owner has not established that this item of work is faulty or otherwise not proper or proficient.
Item (h)
Roof fan struts are not adequately connected to underpurlins in that they are not braced in accordance with [the relevant standard], and where installed in the second floor extension roof, they are not fixed [appropriately].
Recommendation: Install braces to fan struts in accordance with [the relevant standard].
127Mr Machell's evidence was that between two and six fan struts required attention. He conceded that these things could be attended to later but that they should have been done before the roof tiles were installed. To that extent his view was their absence showed defective work.
Finding:
128The Tribunal accepts Mr Machell's evidence that the work is faulty.
Item (i)
Underpurlins supporting hips by cantilever are not adequately connected to the hip rafters and (sic) where they exceed 1/8 of the maximum span of the underpurlin contrary to [the relevant standard].
Recommendation: Install framing anchors to hip/underpurlin connections in accordance with [the relevant standard].
129Mr Machell gave evidence that a proprietary framing anchor or a series of 'strap and block' fixtures were needed to provide the relevant connection, rather than just nails. His view was that attention was required in under six places. His evidence was that this should have been done before the roof had load on it; before the roofing carpenter left the site and that it was thus defective work not incomplete work.
Finding:
130The Tribunal accepts Mr Machell's evidence that the work is faulty.
Item (j)
Rafters over existing house at the rear are supported variously on internal frame walls or external brick walls, and are wedged and not fully supported on the underside of the birdsmouth cut out, contrary to [the relevant standard][.]
Recommendation: Install support to the full width of all rafters bearing on external walls in accordance with [the relevant standard].
131Mr Machell gave evidence that in at least two places he saw rafters supported by wooden wedges. In his view remediation was necessary to make sure the wall plate on the outside wall is fully bearing the weight of the rafters. This would require removal of the wedges and cropping or packing of the rafters or the wall plate on the outside wall. He gave evidence that he was advised by the owner that prior to this, the rafters simply sat on wedges on the inside and there was no wall plate on the outside; that she had had this installed subsequently. He confirmed he did not observe this situation but did observe some rafters still supported by wedges. He confirmed that what he saw was consistent with what she was saying. His evidence was that this was not the work of a competent roof carpenter which the Tribunal interprets as an opinion of faulty workmanship.
Finding:
132The Tribunal accepts Mr Machell's evidence that the work is faulty.
Item (k)
Rafters over existing house at rear were apparently cut short of the external walls and have been extended. The method of extension appears to be unsuitable in that the rafters are separating at the junction.
Recommendation: Install additional fixings at lapped joints of all rafters in accordance with [the relevant Australian standard].
133Mr Machell expressed the view that the method of splicing the extension timbers together was insufficient and that further bugle head screws in each rafter would be required. He expressed the view that the splicing was just not done properly the first time and that that was subsequently manifested by the rafters separating so he would regard the 'fixing' involved in the splicing of the timbers as faulty. He conceded that there was room for an argument that this is something that could have been gone back to later by the builder. The Tribunal's impression, however, was that he viewed the work is defective notwithstanding that it could have been remedied later.
Finding:
134The Tribunal accepts Mr Machell's evidence that the work is faulty.
Item (l)
Collar ties are not installed to main rafters over the garage contrary to [the relevant standard].
Recommendation: Install collar ties to every second pair of main rafters in accordance with [the relevant standard] and ensure that the roof is otherwise coupled.
135Mr Machell gave evidence that two or three collar ties needed to be bolted in between every second pair of rafters to prevent the rafters from spreading.
Finding:
136The Tribunal accepts Mr Machell's evidence that the work is faulty.
Item (m)
Brick ties between [timber] frame and [single] brick walls are missing at the garage in some instances … and, in other locations throughout the new building works, where installed, are not adequately connected to the timber framing contrary to [the relevant standard].
Recommendation: Install wall ties between the timber framed walls and brick walls [as per the relevant standard].
Finding:
137The Tribunal accepts Mr Machell's evidence that the work is faulty.
Item (n)
Brick ties where installed between the framed and masonry walls are not installed [on the correct slope] so that … the passage of moisture between the walls, [is prevented,] contrary to [the relevant standard].
Recommendation: Install wall ties between the timber framed walls and brick walls in accordance with [relevant standard] and so that moisture may not pass across the cavity.
Item (o)
Brick ties between the masonry wall and the timber framed wall are not connected to the sides of the timber framed walls in all instances contrary to [the relevant standard].
Recommendation: Install wall ties between the timber framed walls and brick walls [to standard].
138There was considerable discussion about how the remediation for items (n) and (o) might be achieved given that the brickwork is up. Mr Machell indicated that between 60 and 90 new ties would be needed in the three sections of wall affected. He confirmed that these ties should have been installed at the time that the brick walls were put up and thus that the work was defective.
Finding:
139The Tribunal accepts Mr Machell's evidence that the work described under items (n) and (o) is faulty.
Item (p)
Particle board flooring to the area between Retreat 1 and Retreat 2 is not adequately protected and is water damaged so that it will likely require replacement[.]
Recommendation: Remove and replace all particle board flooring to the area between Retreat 1 and Retreat 2.
140Mr Michel reiterated his view that to have laid the particle board flooring without taking proper steps to protect it when there is no roof cover to protect it constitutes defective workmanship. It was put to him that the work, being the taking of steps to cover the flooring, could be regarded as unfinished in that it had simply not been got to, rather than that it had been necessarily neglected. In any event, the Tribunal notes that Mr Machell expresses some uncertainly as to the requirement for the replacement of the particle board.
Finding:
141The Tribunal's view is that the owner has not established that this item of work is faulty or otherwise not proper or proficient.
Item (q)
… Sarking as a vapour barrier is required at timber framed and brick external walls and to ensure that bulk insulation does not close the cavity when achieving the required EE rating and insulation value of the wall. Sarking is not installed in walls.
Recommendation: Install sarking to cavity side of timber framed external veneer walls, or otherwise install suitable restraint for the bulk insulation where R2.8 rating is achieved without sarking and so as to maintain cavity in veneer construction.
142Mr Machell confirmed that a vapour barrier would 'likely' be required anywhere where there were brick veneer walls and that the absence of a vapour barrier in these circumstances would constitute a failure to comply with the Building Code of Australia. He conceded that at the time of his inspection, the insulation material had not yet been installed on the walls.
Finding:
143Mr Machell does not express an opinion that the absence of sarking in the walls at the time of his inspection constituted faulty work. There are other ways that the applicable energy rating could be achieved. He simply expresses the opinion that it is 'likely' required to be done to meet the standard. The Tribunal's view is that the owner has not established that this item of work is faulty or otherwise not proper or proficient.
Item (r)
V shaped gutters are installed at the parapet wall junction with the roof over the 2ⁿᵈfloor extension and which are not box gutters, contrary to [the relevant standard].
Recommendation: Remove the existing V shaped gutter and reform box gutters with sumps and overflow devices in accordance with [the relevant standard].
144Mr Machell confirmed that a box gutter has been installed over the garage but not along either of the two boundary walls.
Finding:
145The Tribunal accepts Mr Machell's evidence that the work is faulty.
Item (s)
A cavity or waterproofing barrier is not maintained at the garage walls where boundary internal walls abut the front and rear walls of the garage external walls, although the drawings show that a cavity is not required; however where such a construction will result in dampness in internal walls transferred from the external walls and may otherwise be overcome by the installation of a vertical flashing, that would be faulty [workmanship] in my opinion. Whilst this is not adequately documented on architectural drawings, construction in this manner is contrary to [the relevant standard].
Recommendation: Paint all external walls adjacent to the cavity bridging with a clear silane based water repellent, and maintain so as to ensure that [the relevant standard is maintained].
146Mr Machell gave evidence that an alternative was to cut the walls back and maintain the cavity space. He confirmed that only one of the two proposed solutions was required.
Finding:
147The Tribunal takes the view that this aspect of the works is properly regarded as unfinished rather than defective. The Tribunal's view is that the owner has not established that this item of work is faulty or otherwise not proper or proficient.
Item (t)
Strutting/counter beam over upper level are inadequately supported by the wall plate contrary to [the relevant standard] and have been notched excessively.
Recommendation: Install additional supports to top plate in accordance with [the relevant standard].
148Mr Machell gave evidence that where wall plates are accommodating a roof and ceiling load, they need to be fixed at 600 spacings. The ones installed in this property were not, and required fixing underneath the strutting beam with 12 millimetre dynabolts or the like in perhaps half a dozen locations.
241This portion of the builder's claim, had the Tribunal had jurisdiction, would be rejected on these alternate bases.
Issue 8 - Builder's claims on variations
242The builder seeks an order that the owner pay him for what he said were a number of variations agreed to the contract. It is common ground that no written variations were ever signed by the parties. The owner's evidence is that written variation documents were only presented to the owner at the time that the parties were in dispute and were respectively seeking advice of lawyers.
243It is noted that clause 17 of the building contract provides that the contract may be varied at the request of the owner by the performance of extra work with the consent of the builder. It further provides in sub paragraph (c) of clause 17 that the details of any variation must be in writing setting out the cost and all of the terms of the variation, showing the date of the variation and must be signed by both parties or their agents, and that the owner must be given the signed variation before the work to which the variation relates is commenced.
Sarking (sisalation) in the roof
244The builder relies on an oral agreement reached between him and the owner as works proceeded to install sarking in the roof over the garage and the roof over the top of the house, as confirmed in an email dated 1 March 2016 which provides '… I have ordered sisalation as well as per our last conversation. The price for sisalation (purchase and install) is 1550 dollars which I consider reasonable. This will be install (sic) prior to roof tiles. As soon as the top roof is covered we start working inside top part and continue same time above garage area …'. His evidence is that the same price was agreed for both roof areas.
245This agreement is reflected in two variation documents (one for each section of the roof) prepared by him both dated 25 April 2016. It is noted that both documents are endorsed 'please note, the works have been completed few weeks ago (sic) …'. Both also record 'Variation Notice: Sarking installed at [2nd/3rd] storey area as previously agreed' and '… No allowance for sarking' was previously made …' and each record a cost inclusive of GST of $1,705.
246There is no issue that the sarking was installed or that there was an agreement to install it. The owner's position that the sarking was included in the original contract arrangements; that she did not ever request or agree to a variation or to any additional cost being paid.
Findings
247The Tribunal accepts that nowhere in the contract documentation is there any reference to the installation of sarking. The specification makes reference to insulation but not sarking or sisalation. The sarking clearly was installed. The Tribunal takes the view that the explanation of an oral discussion to proceed with the sarking, subject to the provision of a quotation for those works, followed by a further discussion in which the quoted price is agreed orally, followed subsequently by the recording of these matters in a variation document, as outlined by the builder, is all inherently probable.
248The Tribunal accepts it as more probable than not that there was an oral agreement between the parties to install sarking as reflected in the builder's email of 1 March 2016 (HB117) and that it was upon the basis of this agreement that the builder proceeded with the installation. Whilst it is true that these matters ought to be the subject of a signed variation prior to the performing of the work, the Tribunal accepts that in this instance, as occurs from time to time, that did not happen contemporaneously. Of itself, that is not a reason for the builder not to be paid. It would be unfair for the owner to have the benefit of the installation of sarking at what the Tribunal accepts was an agreed additional cost merely because the final paperwork was not completed. Where it can be sufficiently demonstrated that the matter was the subject of agreement, the builder is entitled to be paid on a quantum meruit basis. The Tribunal is so satisfied and the owner should pay the builder the sum of $3,410.
Electrical work done by the builder –
249The builder claims $3,080 being for electrical works done by him over and above the obligations on him under the contract. The owner disputes the claim stating that no electrical works beyond the scope of the contract were done by the builder.
250The contract specification document provides under the heading 'electrical' the following: 'as no plans are provided, a Standard allowance is included for electrical work. The owner will decide the positions of the various items. The builder will install all cabling in the walls and all necessary wiring'. In his evidence, the builder confirmed that the 'standard allowance' referred to equates to one light fitting and light switch and one power point in each room.
251It is noted that in the documents lodged by the builder in support of his electrical claim are two unidentified documents which appear at pages 120 121 of the hearing book. Neither are signed. The provenance of these documents is unclear. They are not part of the contract between the parties. They are not part of SQ2. The Tribunal proposes in the circumstances to place no weight on them.
252The builder relies on an invoice raised by his electrician and directed to him dated 11 April 2016 which relates to the following work done for the builder:
pre-wire for lift cabling from switchboard to lift
pre-wire top floor with extra power points and switches
pre-wire middle floor with extra 2 ovens and TV cabling
253The builder's evidence is that, as the project progressed, the owner wished to include additional electrical points in various rooms and, in two of the three retreat areas, to add an oven in the food and drink preparation alcoves where previously there had been only a sink and small fridge. His evidence was that the owner met the electrician on site and 'specifically pointed out … every electrical point' and that she 'directed the electrician regarding the lift'.
Findings
254 In relation to the component of the electrical claim that relates to the lift, see the comments under the heading 'The lift works'.
255 The Tribunal accepts that the contract required the builder to perform only the standard electrical installation as previously referred to and that anything in addition to this that was required by the owner would be at additional cost to her. The Tribunal accepts it as more probable than not that there was an oral agreement between the parties that the builder's electrician, whilst on site, would do additional works at the direction of the owner for the installation of additional electrical points, switches and wiring for which she would be billed by the builder, and that it was upon the basis of this agreement that the builder's electrician proceeded with those installations. To that extent, the Tribunal accepts the evidence of the builder. As referred to above, whilst it is true that these matters ought to be the subject of a signed variation the Tribunal accepts that in this instance, as occurs from time to time, that did not happen contemporaneously. As stated above, of itself, that is not a reason for the builder not to be paid. It would be unfair for the owner to have the benefit of the extra electrical installations at what the Tribunal accepts was an agreed additional cost merely because the final paperwork was not completed. Where it can be sufficiently demonstrated that the matter was the subject of agreement, the builder is entitled to be paid on a quantum meruit basis. The Tribunal is so satisfied and the owner should pay the builder the sum of $2,310.
The lift works
256 The lift alteration (in place of the spiral staircase shown in WD1) clearly post-dated the builder's quotation. There was no further quote in writing prepared by the builder relating to the lift works. As much is conceded by the owner in her emails regarding the lift footing to be referred to.
257 The lift chamber and mechanism itself was always to be provided by third parties and paid for by the owner. The builder's case is that the work required by him and his trades concerning the supporting face brick wall, the lift footing and the necessary electrical work (the extra works) was the subject of specific discussion and agreement on site and was always in addition to the contract price.
The builder's claim - double brick wall (face brick, Leveque type)
258 The builder claims $22,271.50 for the wall costs as a variation on the original plans. No formal quote or variation was prepared. The builder's figure is based on a calculation prepared by him and included in the evidence at HB131. The cost per pack of the standard bricks needed and the per load cost for the required sand is vouched as is the labour rate component for the bricklayers. None of the other unit costs, rates or quantities is independently vouched.
The owner's response
259 The owner's position is that, in WD1 a double brick wall was included behind the spiral staircase on the rear of the house as a provision for a future lift; that when the agreement was reached to go ahead with the lift and to in fact install it against the garage wall on the opposite side of the courtyard rather than against the rear of the house in the position planned for it initially (in place of the spiral staircase), it was understood by both parties that the costs 'bounced off' and that no variation or additional cost would be sought by the builder in relation to the face brick wall.
260 The owner relies on two emails by her to the builder in December 2015 which record:
Also for your information, on the previous drawing (D10103 Rev 3) which required to build double brick wall on second floor [on the house side] for the provision of a future lift, this is no longer required on the new drawing, however the new drawing (Rev 4) requires a double brick wall to support the lift (garage wall) the cost of which would naturally be a bounce off.
261 and earlier in the same emails
… I have spoken to engineer Darren [Goodison] he confirmed the cost for D10103 Rev 4 drawing would be more or less the same compared to D10103 Rev 3 … the variations between [the] two drawings are bouncing off …'
The builder's claim the lift footings
262 The builder claims $6,496.55 as the cost of the lift footing required also as a variation. In relation to the footing for the lift, the builder claims $6,496.55 for works done. He relies upon two emails from the owner to him in December 2015 and which corroborate an agreement that he would be paid for doing the lift footing. The pertinent part of the email reads:
… Variation 3: Concrete lift pad: this work is only required … to accommodate the lift, it was not included in your previous quote and subsequent signed contract … Having said that, as I specifically indicated to you that "the lift footing is extra work I will pay you the cost", I therefore will honour my words to pay the cost for the lift footing work you have done. However, I believe the quoted cost of $6496.56 is first of all incorrect, you have added 10% GST on your 15% fees which GST has already been included (GST on top of GST), the correct figure should be $6412.92 …
The owner's response
263 In her written response, the owner states that '… I did not request or agree to the variation. The builder abandoned the site once more and threatened me that he was not coming back to work unless I pay him this extra. He demanded cash payment of $5500 from me for this work on 31 December 2015. He refused to give a receipt or signature for this payment …' .
264 The Tribunal understands the owner's position to be that this item of the builders claim has already been settled by the cash payment referred to and that no further claim can be made by the builder.
The builder's claim electrical pre-wire for the lift
265 The builder claims $770 as the pre-wire cost for lift cabling from switchboard to lift, also as a variation. The builder relies on the invoice raised by his electrician previously referred to dated 11 April 2016 which relates to the following work done for the builder:
pre-wire for lift cabling from switchboard to lift … $700 [plus GST of 10%]
The owner's response
266The owner disputes this claim. Her evidence is that no such electrical work was done through the builder. She claims that she engaged an electrician who did the work subsequent to her termination of the contract.
Findings
267The Tribunal accepts the owner's evidence about the agreement in relation to the face brick wall and, in particular, that the costs of this amended wall construction on the garage wall side of the courtyard would be set off against what would have been the costs of its construction on the house side. The evidence is plausible and credible. It is consistent with the content of the sets of plans, with the content of contemporaneous emails and is corroborated by the reported comments from the project engineer.
268In any event, the Tribunal is not satisfied that the builder has established on the balance of probabilities that the construction of the wall to support the lift on the garage side of the courtyard would in fact cost the sum he has claimed. There was no independent evidence provided from a party willing and able to do such a piece of work as to what the work would actually cost. Whilst the Tribunal accepts that there would be a cost in the construction of such a wall were there not a set off arrangement, the builder's own calculations in this regard are insufficient. He has an interest in the outcome and cannot be his own independent expert. Little weight can be attached to his calculation. He has the obligation of satisfying the Tribunal as to the amount claimed and he has not done so.
269In relation to the claim for the footing, whilst the owner conceded in email exchanges that an additional cost of at least $6,412.92 was outside of the contract terms, and was due by her to the builder, the Tribunal accepts her evidence that this aspect of the builder's claim was settled by agreement between the parties upon payment of the sum of $5,500 in cash by her to the builder. The Tribunal accepts her evidence that there was a stand-off between the parties and that, in order to keep the project going and the builder on site, the owner, having originally proposed that she only pay half of the footing costs, agreed to pay him a discounted proportion of the full sum on the basis that it was paid in cash.
270It is for the builder to satisfy the Tribunal on the balance of probabilities that he is owed this money and, in the circumstances, the Tribunal is not satisfied that he has done so.
271In relation to the claim for electrical costs relating to the lift, the builder's version of events is corroborated by the invoice received from his electrician. The Tribunal has no reason to doubt that the tradesman behind the invoice did the work described in the invoice. It is completely plausible that the preliminary pre-wire work would have been done by the electrician at the time that the balance of the house was prewired and there is no suggestion that this work was not done; indeed as can be seen from matters already alluded to, the Tribunal accepts that other additional work to that set out in the contract was done on the request of the owner by the electrician for the builder. This aspect of the builder's claim succeeds.
Cavity Doors
The builder claims a variation of $1,363 for the additional cost of cavity door frames which he says were requested by the owner to be installed in lieu of the standard metal door frames he says were specified in the contract. The owner's response is that the drawings at all times showed a combination of cavity doors and swing doors.
Findings
It is clear from a perusal of all three sets of plans - the initial concept drawings, WD 1 and WD 2 - that the owner's position is correct. The plans do designate the use of at least six cavity doors.
The builder concedes that he had available to him prior to the preparation of his quote at least the initial concept drawings. The Tribunal takes the view, therefore, that he was on notice of the cavity door requirement.
The only reference to doors in SQ2 appears in paragraph 8 under the heading 'Metalwork', and refers to 'standard' metal door frames from the builder's range. There is no reference to swing or cavity door frames. It is the Tribunal's understanding that this is because cavity doors are timber framed not metal framed. They would not have been included in a specification under metal work but would, if referenced, have been designated under the Joinery/Carpentry which simply provides 'match existing'. In the view of the Tribunal it is appropriate that any ambiguity or uncertainty be resolved by reference to the drawings, which, in all three iterations, clearly show a requirement for at least six cavity doors.
The Tribunal rejects the builder's claim that this matter should be the subject of a variation which would entitle him to monies over and above the contract price. This aspect of his claim is rejected.
Issue 9 interest and other expenses
The owner makes a claim for bank interest that she has incurred and other costs that the alleged failures and breaches by the builder have caused her.
Findings
The Tribunal is not satisfied that those losses are sufficiently identified, quantified and proven by evidence to the Tribunal. This aspect of her claim is dismissed.
Summary
In light of the findings made above, the outcomes of the various claims by the parties is as follows:
In relation to the owner's claims:
1)The first part of the owner's claim is dismissed.
2)The second part of the owner's claim is dismissed.
3)In relation to the third point and the owner's claim to faulty and defective workmanship, the builder is liable to the owner in the sum of $16,251. The owner's claim for interest and other out-of-pocket costs is dismissed.
In relation to the builder's claims:
1)In relation to the builder's contract variation claims, the owner is liable to pay to the builder the sums of $3,410 for sarking, $2,310 for house electrics, $770 for lift electrics but not otherwise.
2)In relation to the builder's claim for tools and equipment and signage, the builder's claim is dismissed
3)In relation to the builder's claim for materials, the builder's claim is dismissed.
4)In relation to the builder's claim for scaffolding high fees, the builder's claim is dismissed.
5)In relation to the builder's claim for unpaid work under the contract, the owner is liable to the builder in the sum of $20,692.
6)In relation to the builder's claim for extra work involved in relation to the alleged plans discrepancy, the builders claim is dismissed
282What follows from the findings of the Tribunal is that under s 36(1)(c) of the BSCRA Act, the builder is liable to pay to the owner $16,251 and under s 41(2)(b), the owner is liable to pay to the builder $27,182.
Orders:
Accordingly, the Tribunal makes the following orders:
1.Under s 36(1)(c) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA), the builder is ordered to pay to the owner the sum of $16,251.00 within 28 days of the date of this order.
2.Under s 41(2)(b) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA), the owner is ordered to pay to the builder within 28 days the sum of $27,182.
3.The applications are otherwise dismissed.
I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.
MS H LESLIE, MEMBER
23 AUGUST 2018
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