Holmes v Queensland Building Services Authority - [2010] QCAT 197

CITATION: Holmes v Queensland Building Services Authority [2010] QCAT 197

PARTIES: Richard Holmes and Barbara Holmes

v
Queensland Building Services Authority

APPLICATION NUMBER: QR255-08

MATTER TYPE: General administrative review matters

HEARING DATE: 12 February 2010

HEARD AT: Brisbane

DECISION OF: Richard Oliver, Senior Member

DELIVERED ON: 10 May 2010

DELIVERED AT: Brisbane

ORDERS MADE: Application allowed; Direction that the

Application to claim against the Insurance Fund be allowed

CATCHWORDS: Statutory Insurance Fund; whether satisfactory explanation for delay; prejudice and consideration of purpose of the Insurance Fund and section 26A of the Queensland Building Services Authority Act.

APPEARANCES and REPRESENTATION

Applicants in person
Ms Jones of the Queensland Building Services Authority.

REASONS FOR DECISION

Background

Richard and Barbara Holmes purchased a residential property at 70 Orchard Terrace, St Lucia, on 14 December 2001. The house was new and had been constructed by a registered builder, Peter Atkins, who at the time, held license no. 705015.

Although the Holmes commenced moving into the property upon taking possession after settlement, they did not actually take up occupation of the house until mid-January.

It was during the process of moving in that they gradually became aware of a number of building defects in the property, despite obtaining a pre-purchase inspection from Archyicentre Limited. That Inspection Report identified a number of maintenance issues but not the type of defects particularised in the letter the Holmes sent to Mr Atkins of 1 May 2002. The defects they have had to attend to are detailed in a comprehensive letter to the respondent on 20 September 2008.[1]
[1] Statement of Reasons “SOR 9”

In January 2002 Mrs Holmes contacted the builder, Mr Atkins, about the defects they had discovered at that time, and to his credit he was willing to return to the property and attend to some of the defects. That was the commencement of an ongoing relationship between them where, as defects were discovered, Mr Atkins would return to the property, generally at his convenience, to carry out rectification work.

In April 2002 the Holmes’ engaged an engineer to inspect the premises and provide a report in particular with respect to the state of the tiling. Mr Hemphill’s report details the causes of tile cracking and notes the extent of the drummy tiles in the living area. He concluded:

“Floor tiles in the Living Space show transverse cracks because of the 11 meter length of tiling without a joint.
Drumminess of tiles in Living Space and Entry Vestibule already affects about 5% to 6% of tiles in the Living Space and 11% in the Entry Vestibule. In a new building yet to be subjected to most of the movement and wear and tear likely in its life, this is unacceptable.
The cause of drumminess cannot be established for reasonably certainty until the tiles come up; however the clustered nature of the drumminess suggests problems with the substrate, such as an excessively smooth steel trowel finish, or remaining curing oil, not removed or prepared properly before tiling.

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: [2010] QCAT 197
Decision Date: 10 May 2010

CaseChat Overview and Summary

The case of Holmes v Queensland Building Services Authority involves the applicants, Richard and Barbara Holmes, who purchased a residential property in December 2001 and discovered significant building defects post-occupation. They lodged a complaint with the Queensland Building Services Authority (BSA) in August 2005, but the BSA rejected their claim for insurance assistance on 27 October 2005, citing time delays. The applicants sought a reconsideration of this decision, which was again rejected in October 2008. The applicants appealed this decision to the Queensland Civil and Administrative Tribunal (QCAT).

The primary legal issues before the Tribunal were whether the Authority provided a satisfactory explanation for the delay in notifying the Authority of the defects and whether the Authority would suffer prejudice if the claim were allowed. Additionally, the Tribunal had to consider the purpose of the statutory insurance scheme and the applicability of the discretion under section 26A of the Queensland Building Services Authority Act 1991.

The Tribunal found that the applicants had provided a satisfactory explanation for the delay, as they had maintained a regular dialogue with the builder, Peter Atkins, and had undertaken some rectification work themselves. The Tribunal also concluded that the Authority would not suffer significant prejudice, as the builder's license had been cancelled and the policy had lapsed, rendering the Authority unable to recover costs from the builder. The Tribunal emphasised the purpose of the insurance scheme, which is to protect homeowners from defective work by licensees, and found that the Authority's discretion should be exercised in favour of the applicants.

The Tribunal allowed the application, set aside the Authority's decision, and directed that the applicants' claim under the Insurance Fund be allowed.

Orders