Faulks v New World Constructions Pty Ltd - [2013] QCAT 658

CITATION:

Faulks v New World Constructions Pty Ltd
[2013] QCAT 658

PARTIES:	Mr Richard Faulks and Mrs Megan Faulks (Applicant/Appellant)
v
New World Constructions Pty Ltd (Respondent)

APPLICATION NUMBER:

BDL173-12

MATTER TYPE:

Building matter.

HEARING DATE:

1, 2 and 3 October 2013

HEARD AT:

Brisbane

DECISION OF:

Member King-Scott

DELIVERED ON:

24 December 2013

DELIVERED AT:

Brisbane

ORDERS MADE:

1. The First and Second Applicant’s claim for general damages is dismissed.

2. The Respondent’s counter-application for payment of Stage 4 and ancillary orders is dismissed.

CATCHWORDS:

Failure to complete a stage in construction — Works wrongly suspended — Application for relief from payment of stage because of defective and incomplete work and claim for general damages for distress, inconvenience and discomfort — Contract terminated as Respondent’s QBSA licence suspended — Entire contract — Counter application for payment of stage — Availability of recovery on quantum meruit — Whether the claim for general damages by innocent party enlivens claim by defaulting party for recovery on quantum meruit

Chalet Homes Pty Ltd v Kelly [1978] Qd R 389
Robinson v Harman [1848] Eng R 135
Bellgrove v Eldridge (1954) 90 CLR 613
Nguyen v Luxury Design Homes Pty Ltd [2004] NSWCA 178
Cordon Investments Pty Ltd v Lesdor Properties Pty Ltd [2012] NSWCA 184
Falko v Jones McKewen & Co. Pty Ltd [1977] BR 447
Coshott v Fewings Joinery Pty Ltd BC 960 2970 NSWCA 15 July 1996 (unreported)
Baltic Shipping Company v Dillon (1993) 176 CLR 344
Hutchinson v Harris (1978) 10 BLR 24, 37-238
Batty v Metropolitan Realisations Ltd (CA) (1978) 1 QB 554
Burke v Lunn [1976] VR 268
Bonchristiano v Lohmann [1998] 4 VR 82

APPEARANCES and REPRESENTATION (if any):

APPLICANT:

The Applicants were represented by Mr A West of Counsel instructed by Dale and Fallu.

RESPONDENT:

The Respondent was represented by Mr B Hall of Counsel instructed by JKR Lawyers.

REASONS FOR DECISION

Richard and Megan Faulks (the Faulks) own a house at 9 Stanley Street, North Booval. On 12 December 2011, they entered into a Contract with the respondent, New World Constructions Pty Ltd (New World) to carry out renovations to the property. Those renovations involved raising the house and constructing several rooms underneath.
Plans were drawn up by King Architectural Engineering (KAE).
The construction by New World was supervised by its nominee, Nelson Leon, who was also the Secretary and a Director of New World.
The parties used a Housing Industry Association printed form Contract[1] described as “Qld Plain Language Alteration, Addition and Renovation Contract QC3 March 2008”.
[1] Document 1 Exhibit 1.
The Contract Price was $183,712. The “works” were described as ‘to complete all alteration, addition, renovation works as documented on drawings: King Architectural Job No 11069 pages 1-16’, an outline for the works to be completed as follows: ‘Proposed raise and build of new habitable space below existing house’. [Passages in italics above were handwritten into the document].
Part B of the Contract (being the Prescribed Customised Progress Payment…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2013] QCAT 658
Decision Date

CaseChat Overview and Summary

The dispute in Faulks v New World Constructions Pty Ltd revolves around a renovation contract for a residential property. Mr and Mrs Faulks engaged New World Constructions Pty Ltd for renovations, which included raising the house and constructing rooms underneath. The contract was governed by a Housing Industry Association form and stipulated specific stages of payment. After completing stages 2 and 3, New World claimed completion of stage 4 and invoiced the Faulks for the corresponding payment. The Faulks contested the claim, alleging incomplete and defective work. New World subsequently suspended the works, and the Faulks terminated the contract due to New World's license suspension. The Faulks sought relief from further payments and damages for distress, while New World counter-applied for stage 4 payment and other costs. The court had to decide whether New World completed stage 4, if the Faulks validly terminated the contract, and if New World was entitled to any compensation. The court found that New World did not complete stage 4 as required by the contract and that the Faulks validly terminated the contract. The court dismissed New World's claim for stage 4 payment and all other claims, including costs and interest. The Faulks' claim for general damages was also dismissed as it was not sufficiently particularised and did not meet the legal requirements. The court concluded that the Faulks could benefit from the principles of an entire contract, allowing them to avoid paying for incomplete work without needing to sue for damages.

Orders