HARVEY and DEKONING - [2011] WASAT 209

JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL

STREAM: COMMERCIAL & CIVIL

ACT: BUILDERS' REGISTRATION ACT 1939 (WA)

CITATION: HARVEY and DEKONING [2011] WASAT 209

MEMBER: MR D AITKEN (MEMBER)

HEARD: 25 AND 28 NOVEMBER 2011

DELIVERED : EDITED REASONS DELIVERED ORALLY ON 28 NOVEMBER 2011

FILE NO/S: CC 1361 of 2011

BETWEEN: ERIC HARVEY
SHELLY HARVEY
Applicants
AND
BERNARD DEKONING
SUSAN DEKONING
Respondents

Catchwords:

Application for leave to review decision of Building Disputes Tribunal Application for stay of order to pay Principles to be applied Revocation of order to remedy and making an order to pay in relation thereto Scope of remedial work required by order to remedy Reasonable cost of remedial work Award of legal costs Applicable criteria Failure to comply with order to remedy Builder unreasonably prolonged time taken to complete proceeding in Building Disputes Tribunal

Legislation:

Builders' Registration Act 1939 (WA), s 12A, s 35(2a), s 38, s 38(3), s 38(4), s 41
Building Services (Complaint Resolution and Administration) Act 2011 (WA), s 135(1)

Result:

Application for leave to review decision and to stay order made by Building Disputes Tribunal refused
Application dismissed

Category: B

Representation:

Counsel:

Applicants: Mr A Searle
Respondents : Mr W Vogt

Solicitors:

Applicants: Doyles Construction Lawyers
Respondents : Vogt Graham Lawyers

Case(s) referred to in decision(s):

Ampezzo Pty Ltd and Franken [2009] WASAT 109
Clintway Pty Ltd and The Owners of Strata Plan 21805 [2008] WASAT 294
Haydock and Clark [2011] WASAT 124
Perth Central Holdings Pty Ltd and Doric Constructions Pty Ltd [2008] WASAT 302
Phoenix Timber Products trading as Vintage Hardwoods and Skinner [2005] WASAT 315
Tangent Nominees Pty Ltd and Edwards [2005] WASAT 119

REASONS FOR DECISION OF THE TRIBUNAL:

Summary of Tribunal's decision

The applicants, a builder, sought leave to review a decision of the Building Disputes Tribunal to revoke an order to remedy in respect of faulty floor and wall tiling and replace it with an order to pay, which included an award of legal costs. The applicants also sought a stay of the order to pay.
The applicants contended that the Building Disputes Tribunal had gone beyond its power by basing the order to pay on a scope of remedial work which exceeded the work required by the order to remedy, and that the amount awarded was excessive and unjustified. The applicants also contended that there were no grounds to award legal costs.
The order to remedy had been made by consent of the parties and required the applicants to bring the tiling and associated works to an acceptable standard within the terms of the Building Code of Australia and relevant Australian Standards. The applicants argued that it was their understanding when they consented to the order to remedy that it was limited in its scope to 'recommendations' set out in a report obtained by the respondents from an expert which was referred to in the complaint. After the respondents claimed that the applicants had not complied with the order to remedy, a report was prepared by a Builders' Registration Board inspector which concluded that all the tiling and associated structure required replacement. The applicants argued that this report had enlarged the scope of the order to remedy. The Tribunal rejected the arguments of the applicants and decided that the terms of the order to remedy must be given their natural and ordinary meaning and that the Builders' Registration Board report was based on the terms of the order to remedy.
The applicants also argued that the Building Disputes Tribunal did not have jurisdiction to make an order to remedy which went beyond the 'recommendations' in the report referred to in the complaint. The Tribunal rejected that argument on the basis that, firstly, the complaint was not confined to the specific 'recommendations' in that report and, secondly, even if it was, the Building Disputes Tribunal was entitled to allow the amendment of the complaint before it made the order to remedy.
The Tribunal decided that it was clearly open to the Building Disputes Tribunal to decide, on the evidence before it, that the quotations on which it based the amount in the order to remedy was the reasonable cost of the remedial works required under the order to remedy.
The Tribunal also decided that it was open to the Building Disputes Tribunal, on the evidence before it, to find that there were grounds on which the legal costs awarded to the respondents could be awarded.
Accordingly, the application for leave to review and a stay of the decision of the Building Disputes Tribunal was refused and the application was dismissed.
The Tribunal's reasons, taken from the transcript and edited in minor respects, were as follows.

Introduction

This is an application under s 41 of the Builders' Registration Act 1939 (WA) (BR Act) by Mr Eric Harvey and Mrs Shelly Harvey (Builder) as the applicant against Mr Bernard Dekoning and Mrs Susan Dekoning (Owners) seeking:
1)leave to review a decision of the Building Disputes Tribunal (BDT) made on 3 August 2011, which is reflected in Order to Pay No 25/201112 (Order to Pay); and
2)a stay of the Order to Pay.
The BR Act was repealed on 29 August 2011 but, under s 135(1) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA), this application is to be dealt with as if the BR Act continues to apply.
The BDT made the Order to Pay following a hearing on 29 July 2011 (BDT Hearing). The Order to Pay revoked Order to Remedy No 259/200910 (Order to Remedy), which had been made by the BDT by consent of the parties on 28 April 2010, and ordered the Builder to pay the Owners the sum of $58,111 within 21 days of the date of the order.
The amount of $58,111 is the total of the following amounts:
1)The amount of $50,417 which was determined by the BDT to be the reasonable cost of the necessary remedial works pursuant to s 12A(4a) of the BR Act, being:
$45,738 for the estimate by 'The Bathroom Renovators' for the work required in the bathroom and ensuite; and
$4,679 for the cost of tiles in those rooms.
2)The amount of $7,694 allowed for costs pursuant to s 38 of the BR Act, being:
$6,000 for legal costs; and
$1,694 for the costs of experts engaged by the Owners.
The application, when filed with the Tribunal, stated the grounds on which the review of the decision of the BDT is sought to be:
1)that the BDT erred in that it did not make an order to pay that was reasonable pursuant to s 12A(1a)(b)(i) of the BR Act (First Ground); and
2)such other grounds as may be disclosed upon receipt of the reasons for the decision of the BDT.
Pursuant to a directions hearing on 19 September 2011, the Tribunal ordered that:
•the Builder obtain the transcript of the BDT Hearing (Transcript);
•the BDT provide the reasons for the decision (BDT Reasons) and relevant documents;
•the Builder provide submissions and documents in support of the application; and
•the Owner provide submissions and documents in opposition.
The Transcript (T:1189, 29.07.11), the BDT Reasons, the hearing book and exhibits from the BDT Hearing, and written submissions by the Builder and the Owners were filed in accordance with that order.
In the Builder's submissions, the Builder proposes the following grounds for seeking leave to review the BDT decision:
•That the BDT did not have power, by way of an order to pay, to extend or vary the scope of an order to remedy which has not been complied with, but did so in any event (Second Ground);
•In making the Order to Pay, the BDT awarded amounts which were excessive and unjustified (Third Ground); and
•The BDT awarded costs pursuant to s 38 of the BR Act when the grounds to do so did not exist (Fourth Ground).

The background of the BDT decision

Briefly, the background to the BDT decision is as follows:
The Builder performed building work, which included the construction of a bathroom and an ensuite and the renovation of a laundry and toilet, at the Owners' residence at Lot 50 Ferguson Road, Glen Forrest.
The Owners, by their lawyer, Mr Kevin Burgoyne, gave a preliminary notice to the Builder dated 20 October 2009 (Preliminary Notice) calling on the Builder to rectify the matters referred to in a report by Mr Stephen Needs of Tilespec Tiling Consultants dated 12 September 2009 in respect of the tiling in the bathroom, ensuite, laundry and toilet (Tilespec Report).
The Preliminary Notice did not result in the resolution of the matter and the Owners lodged a complaint with the BDT on 22 January 2010 in respect of the matters in the Tilespec Report.
A directions hearing was held by the BDT, constituted by Deputy Chairperson Lang, on 27 April 2010 pursuant to which the Order to Remedy was made by the consent of the Builder and the Owner.
The Order to Remedy, which is dated 28 April 2011, is in the following terms:
1The [Builder] is ordered to bring the tiling and associated works up to an acceptable standard within the terms of the Building Code of Australia and relevant Australian Standards, and make good any structural or substrate damage within 28 days of the date [of the order].
2The [Builder] is to arrange access to the site through Mr Kevin Burgoyne, solicitor for the [Owners].
3The [Owners] will seek an inspection by the Builders' Registration Board in the event that the [Builder] has failed in their [sic] opinion to comply with the Order to Remedy.
4Either party has liberty to apply for further orders as necessary.
The Builder sent a letter dated 20 May 2010 to the Owners care of Mr Burgoyne setting out a proposal for remedial works.
Mr Burgoyne sent a response dated 28 May 2010 to the Builder which stated as follows:
As previously advised we have reason to believe that the construction methods adopted by your company are not in accordance with the relevant Australian Standards.
At the BDT directions hearing you agreed to consent orders being made for you to complete the works to the relevant standards within 28 days. You have a copy of those orders.
The 28 days has expired for you to do that work in that time you have failed to do any works whatsoever. [sic] You sent a letter dated 20 May 2010 to me indicating what you were going to do and asked for my client's approval. I attach that letter.
My client is not a builder and therefore would not know whether your proposal is in accordance with the BDT orders (to relevant Australian Standards).
Further attached is part of an email from my client to me extending the time for you to complete the works and providing you with information on how to source tiles. That extension of time is for 28 days from 26 May 2010. You have said that (and my client denies) you have always wanted to repair the works. You were given 28 days and have failed to complete the works. We are extending that time now for a further 28 days. You have no access problems. My clients have done everything that is required. You have no excuse for delaying the works any further.
We ask that you source the tiles and complete the works as ordered by the tribunal. All that we ask is that you notify me of the times access will be required.
You have told me that your email is not working and that I can communicate by SMS. I have sent 16 SMS messages to you since the [sic] 3 May 2010. On 24 May 2010 I referred to your letter dated 20 May 2010 and asked that you proceed in accordance with the BDT orders. On 26 May 2010 I telephone [sic] you and you [sic] asked you to complete the works in accordance with the BDT orders.
Please commence works immediately and complete within the extended time given. You consented to repair the workmanship matters in accordance with the relevant standards and are now requesting agreement of a repair method as indicated in your letter prior to commencing work. Agreeing on a repair method is outside of what was consented to and repairing the work is solely within your hands.
You have been given access. You have been told by the BDT what you have to do. You have been given an extension of time. You have been provided with (and I understand told on many previous occasions) where to access tiles.
If we have to return to the BDT to seek orders in relation to payment for repairing the works or any further orders then we will be seeking legal costs from you for that on the basis that amongst other things you are causing my client unnecessary costs after you have agreed to certain conduct.
If you do not know how to complete the work in accordance with the Building Code and relevant Australian Standards then please let me know. My client's are [sic] not in a position to tell you how to do your professional job.
I also refer to your letter dated 20 May 2010 (last paragraph). You do not need to wait for my reply for anything except for access when you notify me of when you will be there at the site.
We will forward a copy of this letter to the BDT asking that the time period be extended for your compliance.
The Owners had agreed to allow the Builder a further 28 days from the original expiry date of the Order to Remedy for the Builder to comply with it and when that period expired, the Owners wrote to the BDT and claimed that the Order to Remedy had still not been complied with and requested a directions hearing.
A further directions hearing was held by the BDT, again constituted by Deputy Chairperson Lang, on 17 August 2010, pursuant to which directions were issued on 18 August 2010 in the following terms:
The issues:
1The [Owners] claim that the [Builder has] failed to comply with the Order to Remedy. In particular, the bathroom is still leaking and the [Builder] has failed to rectify water damage to the timber and substrate.
2The [Builder claims] that [it has] complied with the Order to Remedy and completed all works to a satisfactory standard.
3The [Owners] have lost faith in the [Builder] and now make application for an order to pay for the necessary remedial works.
Directions:
1The Registrar is requested to cause an Inspector of the Builders' Registration Board to inspect and report on the [Builder's] compliance or otherwise with the Order to Remedy, including the requirement that the [Builder] make good any structural or substrate damage.
2The [Owners] agree to provide reasonable access to the [Builder] for the purposes of an inspection by an expert/qualified tradesperson of the [Builder's] choice.
3Copies of all documents to be relied on by the parties including expert reports and quotations must be provided to each other and to the Tribunal not less than 14 days prior to the hearing.
4The [Owners] request the Builders' Registration Board Inspector's attendance at the hearing.
5The parties are directed to provide their unavailable dates for October, November and December 2010 within 14 days.
6The hearing is estimated to require 1 full day.
7This directions hearing is adjourned to a hearing of the complaint on a date to be fixed.
An inspection was conducted by Inspector O'Dea of the Builders' Registration Board on 19 January 2011, following which an inspection report dated 2 March 2011 (BRB Report) was sent to the Builder and the Owners.
In support of their application for an order to pay, on 29 March 2011, the Owners provided to the BDT and the Builder the following quotations and estimates (Quotations) for tiling work in the bathroom, ensuite, laundry and toilet:
•Estimate dated 28 October 2010 by European Ceramics for $5,329 for the supply of tiles for each of those rooms;
•Estimates dated 1 November 2010 for $18,128 for the bathroom, $27,610 for the ensuite and $11,396 for the laundry and toilet (being a total of $57,134), excluding the supply of tiles;
•Quotation dated 1 November 2010 by Central Building and Maintenance for $114,046.90, including the supply of tiles; and
•Quotation dated 15 January 2011 by Bathrooms by Hart for $70,510, excluding the supply of tiles.
The matter was listed for hearing in the BDT on 12 May 2011, but that date was vacated at the request of the Owners and the hearing was relisted for 29 July 2011. The BDT sent a notice of the relisted hearing to the Builder and the Owners on 15 June 2011.
The decision of the BDT, constituted by Deputy Chairperson Lang as the presiding member plus Builder Member Mittonette and Consumer Member Naseem, which resulted from the hearing on 29 July 2011 is the subject of this application.

Legal principles applying to an application for leave to review and a stay of a BDT order

The principles to be applied to an application for the grant of leave to review a decision of the BDT are well settled and are conveniently set out by Senior Member Raymond in Tangent Nominees Pty Ltd and Edwards [2005] WASAT 119 at [35] [44]. The principles are summarised by Member Carey in Haydock and Clark [2011] WASAT 124 at [10] as follows:
•It must be shown that the decision in respect of which leave is sought is wrong or attended with sufficient doubt to justify the grant of leave.
•In addition, something further must be demonstrated. Substantial injustice resulting from leaving the decision unreversed is a common further requirement, although it is no more than a guideline for the exercise of a broad discretion to grant or withhold leave.
•The additional factor element may in some cases be satisfied if it is shown that a significant question of law is to be considered.
•This Tribunal should be slow to grant leave except in cases where clearly there is no discernible basis for the decision of the BDT, or other cases of apparent error, for example, where rules of procedural fairness have been breached.
•The grant of leave will be limited to such grounds as this Tribunal determines.
The principles to be applied to an application for a stay of an order by the BDT are also well settled and are conveniently set out by Senior Member Raymond in Phoenix Timber Products trading as Vintage Hardwoods and Skinner [2005] WASAT 315 at [10] [13]. The principles may be summarised as follows:
•The starting point is that a successful party should be entitled to the fruits of the order by the BDT, so the onus is on the applicant to demonstrate that the circumstances are appropriate for a stay.
•Before weighing other factors, the Tribunal needs to be satisfied that there is an arguable case for a review, to ensure that the application for a stay has not been lodged simply to delay execution of the BDT order.
•If there is an arguable case for a review then special circumstances must also be shown which justify a stay when weighing the interests of the parties, such as where there is a real risk of the applicant not recovering money paid pursuant to the BDT order. Inconvenience, the possibility of some risk and the preservation of the status quo do not constitute special circumstances.

Consideration

The Tribunal will deal with each of the four grounds for leave to review submitted by the Builder in turn.

First Ground

The First Ground is 'that the BDT erred in that it did not make an order to pay that was reasonable pursuant to s 12A(1a)(b)(i) of the BR Act'.
This ground appears to have been misconceived because the Order to Pay was not issued under this subsection of the BR Act; rather, it was under s 12A(1)(b) of the Act, because it involved faulty or unsatisfactory building work.
The First Ground was not pursued by the Builder and was withdrawn during the hearing.

Second Ground

The Second Ground is that 'the BDT did not have power, by way of an order to pay, to extend or vary the scope of an order to remedy which has not been complied with, but did so in any event'.

The Builder contends that the BDT decision regarding the Order to Pay was based on a scope of remedial work which exceeded the work required by the Order to Remedy and was therefore beyond its power. In particular, the Builder contends that the BDT did not have the power to include in the order to pay the cost of replacing the wall tiling in the bathroom and ensuite, except in the shower recesses.
Section 12A(4a) of the BR Act provides that if the BDT is satisfied that an order to remedy building work made under s 12A(1)(a) or s 12A(1a)(a) of the BR Act has not been complied with in whole or part, the BDT may revoke that order and make an order to pay under s 12A(1)(b) or s 12A(1a)(b)(i) of the BR Act, as the case may be, in relation thereto. The words 'in relation thereto' clearly limit the Order to Pay to the remedial work which was required under the Order to Remedy.
Therefore, if the scope of the work on which the Order to Pay in this case has been based exceeds the scope of the Order to Remedy which it replaced then the BDT will have exceeded its power under s 12A(4a) of the BR Act.
The Builder contends that when the parties consented to the Order to Remedy at the directions hearing in the BDT on 27 April 2010, order 1 of the Order to Remedy was made in reference to and upon the understanding that the work would be completed to the Tilespec Report recommendations and that the Order to Remedy was limited in its scope to selective repair rather than total replacement.
The Builder then further contends that when Inspector O'Dea prepared the BRB Report, he enlarged (although the Builder's submissions mistakenly use the term 'enlivened') the scope of the Order to Remedy because the basis for his report was not specific to the scope of remedial work required, as understood by the parties, to arise from order 1 of the Order to Remedy. The Builder contends that this created the 'mischief' of the recommendation made at the end of the BRB Report that all tiling and associated structure (floor and walls) to the bathroom, ensuite, toilet and laundry was faulty and required replacement.
The Tribunal rejects those contentions. The Order to Remedy required the Builder to 'bring the tiling and associated works up to an acceptable standard within the terms of the Building Code of Australia and relevant Australian Standards and make good any structural or substrate damage'. If, as the Builder contends, the intention had been to require the Builder to perform the work specifically recommended in the Tilespec Report then the Order to Remedy could easily have been expressed in those terms, but it was not, and the terms of it must be given their natural and ordinary meaning.
The Builder further contends under the Second Ground that the matters that were properly the subject of the complaint before the BDT were those matters identified as requiring rectification in parts 10.1 10.18 of the Tilespec Report, because the Preliminary Notice given by the Owners only called on the Builder to rectify or attempt to settle those specific issues. Essentially, this contention is that the BDT did not have jurisdiction to make an order which went beyond the scope of the specific recommendations in the Tilespec Report and therefore the terms of order 1 of the Order to Remedy, given their natural and ordinary meaning, were beyond the jurisdiction of the BDT to make. If that contention is correct, the difficulty which the Builder faces is that the Builder should have sought leave to review the decision of the BDT to make the Order to Remedy in those terms when it was made on 28 April 2010, but the Builder did not do so.
However, because the scope of the remedial work required by the Order to Remedy is the basis on which the BDT had the power under s 12A(4a) of the BR Act to decide the amount to allow for the cost of remedying the faulty work to include in the Order to Pay, the Tribunal has decided that it should consider this issue.
Having considered the issue, the Tribunal rejects the contention for the following reasons.
Firstly, the Tribunal does not accept that the complaint to the BDT was limited solely to parts 10.1 10.18 of the Tilespec Report. The Preliminary Notice stated that the matters to be resolved were all the matters referred to in the Tilespec Report, not just parts 10.1 10.18, and the wall tiling outside the shower recesses was covered in other parts of the Tilespec Report. Part 3 states that the terms of reference for the report is to conduct an assessment of the wall and floor tiling to the ensuite, bathroom, toilet and laundry and to also establish the cause of the moisture problem with the shower recesses. Part 5, which deals with the ensuite, mentions the wall tiling, and part 6, which deals with the bathroom, does likewise. The complaint form lodged with the BDT also refers to the Tilespec Report generally in relation to the workmanship complained of.
Secondly, even if the Preliminary Notice and complaint form were limited to the matters detailed in parts 10.1 10.18 of the Tilespec Report, the BDT was entitled to allow the amendment of the complaint before the Order to Remedy was made to include the scope of remedial work required by the Order to Remedy: : see Clintway Pty Ltd and The Owners of Strata Plan 21805 [2008] WASAT 294 at [53] and Ampezzo Pty Ltd and Franken [2009] WASAT 109 at [41] [47].
The final contention of the Builder in respect of the Second Ground is that the BDT commenced hearing the application for an Order to Pay on the basis that the Order to Remedy was not relevant. The Tribunal rejects this contention because the evidence does not support it. The directions made by the BDT on 18 August 2010 set out very clearly that the Owners claimed that the Builder had failed to comply with the Order to Remedy and that the Owners had lost faith in the Builder and were applying for an order to pay for the remedial works required under the Order to Remedy. Those directions then stated that a request was to be made for an inspection and a report by a Builders' Registration Board inspector regarding the Builder's compliance with the Order to Remedy. The Transcript shows that, at the beginning of the BDT hearing on 29 July 2011, Deputy Chairperson Lang referred to the Order to Remedy, and the fact that some work had been done and the Owners were saying that they were not satisfied and the Builder was saying that he had brought the work up to an acceptable standard (T:4, 29.07.11).
Having rejected each of the contentions of the Builder in respect of the Second Ground, the Tribunal has decided that the Builder has not demonstrated that the decision of the BDT to make the Order to Pay on the basis of the scope of the work required under order 1 of the Order to Remedy was wrong or attended with sufficient doubt to justify the grant of leave to review that aspect of the decision of the BDT.

Third Ground

The Third Ground is 'that in making the Order to Pay, the BDT awarded amounts which were excessive and unjustified'.
The Builder's submissions refer to the decision in Perth Central Holdings Pty Ltd and Doric Constructions Pty Ltd [2008] WASAT 302 at [19] [24] regarding the proper approach to the making of an Order to Pay under s 12A(1)(b) of the BR Act, which is to take a broad brush approach. The Builder agrees with that approach, as do the Owners.
However, the Builder contends that the BDT was in no position to decide the amount to be awarded on the basis of the evidence before it, even on a broad brush approach, because of the factors which are listed in the Builder's submissions. Those factors essentially allege that the Quotations were not adequate to establish that they were for the cost of remedying the faulty work identified in the reports of the experts.
The Builder makes the point that none of the authors of the Quotations testified at the hearing and contends that none of the Quotations, including, in particular, the one preferred by the BDT, contained a scope of works which matched the recommendations set out in the BRB Report or in the further report by Mr Needs of Tilespec Tiling Consultants dated 20 September 2010 (Further Tilespec Report) which had been submitted to the BDT. The Builder's submissions then state that, at best, the BDT simply assumed that the Quotations covered a scope of works which matched the recommendation set out in the BRB Report or the Further Tilespec Report and, at worst, the BDT simply made the Order to Pay because there were no other quotes available. The submissions go on to say that the BDT could not properly draw any conclusion about the relativity of the costings to the selective repair proposed by the expert evidence provided to the hearing. The Builder's submissions conclude on this issue by stating that the BDT could have invited the parties to produce the necessary evidence, but that it did not, and therefore was in no position to make the Order to Pay as it did.
The Builder contends, for those reasons, that the decision to order the amount included in the Order to Pay for the cost of remedial works was therefore not based on a reasonable and proper assessment of those costs.
The Tribunal rejects those contentions. Whilst the authors of the Quotations did not testify at the BDT hearing, a quantity surveyor, Mr Graham Peden, did testify. Whilst the BDT Reasons only contain a brief outline of Mr Peden's evidence, the Transcript shows that it was quite comprehensive and that he was cross-examined at some length by the Builder. Mr Peden's cost estimate provided an independent costing as a comparison for the Quotations which the Owners had obtained from various contractors. Mr Peden testified that he had looked at the Quotations and assessed them against the BRB Report and the Further Tilespec Report, and that he had found the quotation by The Bathroom Renovators to be a good quotation which covered everything and seemed to be fair and reasonable (T:31, 29.07.11). It was clearly open to the BDT on the basis of Mr Peden's evidence to decide, as it did, that the amount of The Bathroom Renovators quote was the reasonable cost of the remedial works required to comply with the Order to Remedy.
The contentions in the Builder's submissions seem to have been formulated without reading the Transcript, which shows that the BDT went to great lengths to explore the issue of what the scope of the necessary remedial works was. The result was the finding of the BDT, stated in [40] of the BDT Reasons, that the recommendation at the end of the BRB Report reflects the reasonable scope of the necessary remedial works.
Having found that the recommendation at the end of the BRB Report sets out the scope of the necessary remedial works under the Order to Remedy, the BDT then found, as stated in [41] and [42] of the BDT Reasons, that the costing in the estimate by The Bathroom Renovators for the bathroom and ensuite (which excluded the supply of tiles) is the reasonable cost of carrying out those works and that the cost for tiles in those rooms allowed for in the estimate by European Ceramics is the reasonable cost of the tiles for those rooms. It was open for the BDT to make that decision on the evidence which it had before it.
During the hearing, the BDT gave the Builder the opportunity to give evidence of what the Builder considered to be the reasonable scope of the necessary remedial works and the reasonable cost of those works (T:166, 29.07.11). The response by the Builder was that he was not able to do so and Deputy Chairperson Lang told the Builder that the BDT would make a decision on the evidence presented at the hearing, which was the correct approach for the BDT to take.
Having rejected each of the Builder's contentions in respect of the Third Ground, the Tribunal has decided that the decision made by the BDT regarding the scope of the remedial work necessary to comply with the Order to Remedy and the reasonable cost of those works was open to it on the evidence presented at the BDT hearing, and that the Builder has not demonstrated that the decision of the BDT to allow the amount of $50,417 for the cost of the necessary remedial works under the Order to Remedy is wrong or attended with sufficient doubt to justify the grant of leave to review that aspect of the decision of the BDT.

Fourth Ground

The Fourth Ground is 'that the BDT awarded costs pursuant to s 38 of the BR Act when the grounds to do so did not exist'.
The Builder's submissions refer to the provisions of s 38(3) and s 38(4) of the BR Act, which set out the power of the BDT to award costs.
The Builder's submissions then refer to [44] of the BDT Reasons and contend that the reasons for the award of legal costs, which are set out in [43] of the BDT Reasons, do not match the criteria in s 38(4) of the BR Act. The Builder's submissions list five statements made in [43] of the BDT Reasons which the Builder says are erroneous with regard to the criteria set out in s 38(4) of the BR Act. The Builder contends that the BDT wrongly awarded legal costs because the circumstances given as reasons did not warrant such a decision.
The Builder is not challenging the power of the BDT to award the costs regarding the engagement of experts by the Owners, or the actual amount of the legal costs awarded. The Builder is simply challenging the power of the BDT to award legal costs at all in this matter.
The critical factor which the Builder's submissions does not address is that the first sentence in [43] of the BDT Reasons states that the Owners were claiming their legal fees under s 38(4) of the BR Act and that the BDT had decided that it is fair to allow this claim, as the Builder had failed to comply with the Order to Remedy without reasonable excuse and had unnecessarily prolonged the proceeding. That statement specifically addresses the criteria set out in s 38(4)(a)(i) and s 38(4)(b) of the BR Act. The statements that then follow in [43] of the BDT Reasons, with which the Builder takes issue, explain why the BDT considered it fair to award legal costs under the criteria in s 38(4)(a)(i) and s 38(4)(b) of the BR Act by detailing aspects of the failure by the Builder to comply with the Order to Remedy and how that failure resulted in the prolongation of the conclusion of the proceeding in the BDT, which did not occur until the Order to Pay was made on 3 August 2011, more than 18 months after the complaint was lodged with the BDT.
During this hearing, it was contended by the Builder that s 38(4)(a)(i) of the BR Act is only concerned with the failure of a party to comply with an interlocutory order or direction and not with the failure of a builder to comply with an order to remedy. The Tribunal rejects that contention. If Parliament had intended s 38(4)(a)(i) of the BR Act to be limited in that fashion, it would have included the word 'interlocutory' in that provision, as it has done in the case of s 35(2a) of the BR Act. The plain and ordinary meaning of the words 'order or direction' in s 38(4)(a)(i) of the BR Act clearly includes an order to remedy.
The finding that the Builder had failed to comply with the Order to Remedy without reasonable excuse was clearly open to the BDT to make on the evidence before it. It was also open to the BDT to find that the failure of the Builder to properly address the problems with the faulty and unsatisfactory building work and to perform the appropriate remedial work had unreasonably prolonged the proceeding in the BDT from the time it commenced with the lodgement of the complaint until the Owners were successful, with the assistance of Mr Burgoyne, in replacing the unsatisfied Order to Remedy made on 28 April 2010 with the Order to Pay made on 3 August 2011, which required the Builder to pay to the Owners a substantial amount of money.
Accordingly, there was a basis under the criteria set out in s 38(4) of the BR Act upon which the BDT was entitled to decide that it was fair to award legal costs to the Owners. Therefore, the Tribunal has decided that the Builder has not demonstrated that the decision of the BDT to award legal costs of $6,000 to the Owners was wrong or attended with sufficient doubt to justify the grant of leave to review that aspect of the decision of the BDT.

Conclusion

The Builder has failed to demonstrate that the decision of the BDT in respect of which leave to review has been sought is wrong or attended with sufficient doubt on any of the grounds raised in the application.
Therefore, the Tribunal has decided that leave to review and a stay of the decision of the BDT must be refused.

Application for costs

Upon the Tribunal advising the parties of its decision, Mr Vogt, as counsel, stated that the Owners wanted to apply for costs. By consent of the parties, it was agreed that the Owners file and serve an application for costs by 16 January 2012 and that the Builder file and serve submissions in reply by 30 January 2012, and that, subject to further order, the Tribunal shall determine the application for costs on the documents.

Orders

For the reasons given above, it is ordered that:
1.The application for leave and a stay is refused.
2.The application is dismissed.
3.The Owners shall by 16 January 2012 file and serve an application for costs properly particularised as to amount and submissions supporting the application.
4.The Builder shall by 30 January 2012 file and serve any submissions in reply.
5.Subject to further order, the Tribunal shall determine the application for costs on the documents.

I certify that this and the preceding [72] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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MR D AITKEN, MEMBER