Imperial Homes (Queensland) Pty Ltd v Queensland Building and Construction Commission
[2014] QCAT 42
•31 January 2014
| CITATION: | Imperial Homes (Queensland) Pty Ltd v Queensland Building and Construction Commission [2014] QCAT 42 |
| PARTIES: | Imperial Homes (Queensland) Pty Ltd (Applicant) |
| v | |
| Queensland Building and Construction Commission (Respondent) |
| APPLICATION NUMBER: | GAR013-13 |
| MATTER TYPE: | Building matters |
| HEARING DATE: | 5 November 2013 |
| HEARD AT: | Brisbane |
| DECISION OF: | Member Paratz |
| DELIVERED ON: | 31 January 2014 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | 1. The decision of the Queensland Building and Construction Commission dated 18 December 2012 to issue Direction to Rectify and/or Complete Number 38333 to Imperial Homes (Qld) Pty Limited is set aside. 2. If either party wishes to seek costs: (a) The party seeking costs is to file in the Tribunal and give to the other party a clear description of the costs and orders sought, and submissions in support, by 4pm on 28 February 2014. (b) The other party is to file in the Tribunal and give to the other party submissions in reply by 4pm on 11 March 2014. (c) The issue of costs will be determined on the papers not before 11 March 2014. |
| CATCHWORDS: | Direction to Rectify – Defects Policy – whether the policy is a guideline – whether strict compliance with the defects policy is needed – intent of the policy – builder relying on design of professional engineer – no defect in construction components – whether it is unfair or unreasonable to require builder to rectify – costs allowed Queensland Building Services Authority Act 1991, s 72 Queensland Civil and Administrative Tribunal Act 2009 ss 100, 102 R v His Honour Judge Miller and the Builder’s Registration Board of Queensland, ex parte Graham Evans & Co (Qld) Pty Ltd [1987] 2 Qd R 446 |
APPEARANCES and REPRESENTATION:
| APPLICANT: | D H Katter (Counsel) Instructed by Doyles Construction Lawyers |
| RESPONDENT: | K Heywood (In-House Solicitor) |
REASONS FOR DECISION
Imperial Homes (Qld) Pty Ltd (the builder), seeks a review of a decision of the Queensland Building and Construction Commission (the Commission) (formerly known as the Queensland Building Services Authority) directing it to rectify defects.
Mr Damien Choy entered into a “house and land package” for land at 15 Yovan Court, Loganlea in Queensland on 12 April 2006, which was part of a new estate.
The builder was building 15 homes on the estate. It entered into a building contract with Mr Choy.
The house was a single story brick home on a concrete slab. Mr Choy bought it as an investment property with the intention of permanently renting it. It was completed on or about 27 November 2006.
Mr Choy gave evidence and said that prior to handover, he inspected the house together with a representative of the developer (the Kaizan property group) and Mr Paul Korn from “handovers.com”. He said there were no problems which prevented the handover occurring.
The builder was notified on 21 January 2010 by the Commission that Mr Choy had lodged a complaint as to defective work. An inspection was conducted on 25 March 2010. On 7 June 2010 the Commission sent the builder a letter advising that the house was “within expected tolerances” and that the commission did not intend to take any further action.
The builder was then notified on 17 May 2012 that Mr Choy had lodged a further complaint. Inspections were conducted on 3 July 2012 and 7 August 2012. The Commission sent the builder a letter on 20 November 2012 requesting rectification of defective work, and on 18 December 2012 issued directions to rectify.
The Direction to Rectify and/or Complete Number 38333 was issued pursuant to s 72(1) of the Queensland Building Services Authority Act 1991 (the QBSA Act). The directions were as follows:-
1.The installation of the concrete footings and the concrete floor slab of the dwelling is not in accordance with the BCA Volume 2-2006 Part 2.1 Structure P2.1 (a) & (b) in that;
- The design of the building footing system did not take into consideration the possible influence of the significant trees on adjoining sites.
- The noted defect has resulted in movement of the buildings footing system and consequential damage to the structure.
- Pertains to items 1, 2 & 3 on the BSA complaint form.
2.The installation of the stormwater drainage pipes connected to a dwelling is not in accordance with AS 2870-1996 6.6 Additional requirements for Class H and E sites – (f) in that;
- Articulation is not installed within 3 m of the dwelling, breakages and damage has occurred to stormwater drainage pipes that have allowed water to pond against the buildings footing system.
- The noted defect has resulted in movement of the buildings footing system and consequential damage to the structure.
- Pertains to item 1, 2 & 3 on the BSA complaint form
3.The installation of the external finished surface surrounding the dwelling is not in accordance with the BCA Volume 2-2006 Part 3.1.2.3 Storm water drainage (a) in that:
- the external finished surface surrounding the slab is not drained to move surface water away from the building or graded to give a slope of not less than 50mm over the first 1m from the building.
- The noted defect has allowed water to pond against the dwellings footing system, has resulted in movement and damage to the buildings footing system and consequential damage to the structure
- Pertains to items 1, 2, & 3 on the BSA complaint form
4.On completion of remedial rectification to the building the licensee is requested to provide the Authority a detailed floor level survey of the building. The levels noted on the survey are to be reduced to a relative “0” datum being the lowest point on the slab. The floor level survey will be used for comparison over the monitoring period to establish stabilisation of the floor slab, prior to completion of cosmetic repairs by the licensee.
- Pertains to item 1, 2 & 3 on the BSA complaint form
At the commencement of the hearing, the Commission indicated that Item 4 of the Directions was abandoned.
Each party had an engineer inspect the property and prepare a report. An experts conclave was held on 25 October 2013 before Member Howard. The two engineers, Mr Rebibou and Mr John Van de Hoef, attended. A comprehensive and clear Conclave Report was produced by the experts with the assistance of the Member.
The experts conclave was extremely helpful and made the determination of this matter much simpler, saved a great deal of hearing time, and added certainty to the resolution of the technical questions. The experts are to be complimented on being able to assist the Tribunal in this way to make the correct and preferable decision.
Section 72(14) of the QBSA Act[1] provides that:-
(14)The authority is not required to give a direction under this section to a person who carried out building work for the rectification of the building work if the authority is satisfied that, in the circumstances, it would be unfair to the person to give the direction.
[1]Queensland Building Services Authority Act 1991.
The Tribunal has jurisdiction to review the decision of the Commission to direct rectification of tribunal work.[2] On review, the Tribunal may confirm or amend the decision, set aside the decision and substitute its own decision; or set aside the decision and return the matter to the decision-maker.[3]
[2]QBSA Act s 86(1).
[3]QCAT Act s 24.
The Tribunal has all the functions of the decision-maker for the reviewable decision.[4] The purpose of the review is to produce the correct and preferable decision, following a fresh hearing on the merits.[5] The Tribunal stands in the shoes of the decision-maker and makes the decision afresh.
[4]QCAT Act s 19(c).
[5]QCAT Act s 20.
In deciding whether to issue a direction to rectify, the Commission has regard to a document entitled “Rectification of Building Work Policy – Queensland Building Services Board”. This is commonly referred to as “the defects policy”.
Section 8 of the QBSA Act established the Queensland Building Services Board. One of the roles of the Board is to make and review policies governing the administration of the QBSA Act [6]. The Commission submits that the effect of section 9A of the QBSA Act is that the Board’s policies constitute statutory instruments and are subordinate legislation.
[6]QBSA Act s 9.
The defects policy was published in the Queensland Government Gazette on 27 August 2004, and took effect from 1 September 2004.
The developer obtained soil tests for each of the 15 individual blocks on which the builder was erecting homes. The geotechnical report for this property was dated 23 March 2006 by Bowler Geotechnical and signed by David Bowler, an RPEQ. It concluded that “The results of the site investigation work indicate that the site may be classified Class ‘H’ in accordance with AS2870-1996 ‘Residential Slabs and Footings’.[7]”
[7]Letter Bowler Geotechnical 23 March 2006, para 7.
The builder engaged Structerre Consulting Engineers to design the slab at this property. Their Engineering report and Slab/Footing design is dated 26 May 2006[8].
[8]Tendered as Exhibit 2, contained in Commission’s Statement of Reasons p 80.
The defects policy provides in section 2(2) that “it may be unfair or unreasonable, for example, to issue a direction if the building contractor in carrying out the work has complied with schedule 1”. Schedule 1 is headed “Rectification for residential construction work causing subsidence”.
Schedule 1 of the defects policy provides that “For section (2) of the policy, to comply with this schedule the building contractor must do all of the following;” and lists
(a) information which the building contractor must give to the engineer (or obtain written confirmation from the engineer that the engineer has the information), and
(b) the matters of which the building contractor must obtain written confirmation from the engineer
The builder argues that he has relied on the Geo-Technical Engineer and on the Design Engineer, and that it would be unfair to require it to rectify the defects.
The Experts Conclave Report was as follows:-
Possible causes and underlying assumptions re footing system movement to dwelling
1. Soil Test
Agree
The correct classification should have been “P”.
(a) Reactivity
Agree proper class is high H or low E
(b) Agree a soil tester was not entitled to re-classify from P to H on basis of controlled fill certification if trees on site or on adjoining site.
(c) The soil test makes no reference to the existing trees although our investigations documentation/available suggest the engineer or his/her representative visited the site.
(d) The soil test report was signed by a Registered Professional Engineer, Queensland.
2. Footing design
Agree the footing design/drawings do not take into account the existing trees on the adjoining property.
Agree
· The design report contained a photograph of the trees
· After footing inspection, confirmation of the suitability of the design was issued by design engineers.
· On the footing and slabs inspection certificates, the engineer certified the original soil classification is correct.
· At 2 locations in footing design documentation, the designer identifies that trees should be kept at an appropriate distance from the house and that the site should be maintained in accordance with CSIRO BTF 18.
· Where tree/s are located on an adjoining property outside the control of all parties associated with the site, competent design should include due allowance of the tree/s.
· The documentation available to us included a design report with photographs and suggests that the engineer or his/her representative visited the site prior to the completion of the design and issuing of an engineering compliance certificate stating that the design takes account of site conditions (including information provided by the builder).
3. Trees
At rear
· The trees at the rear are on an adjoining property
· The rear trees are the predominant factor driving footing system movement because they are contributing to soil moisture removal and shrinkage of clay founding soils and subsequent building subsidence.
· The front sections of the house have been stable over the last 12 months but subsidence continues at the back as indicated by the level difference surveys. As a result of this we hold the opinion that the trees are the major contributing factor to the ongoing subsidence at the back of the house.
Other trees
· There are trees at the front right-hand corner of the property.
4. Site drainage
Right-hand side from street
· Gravel can impede site drainage
· There is a gravel area on this site to right-hand side
· The surface levels below the gravel indicate generally compliant falls away from the dwelling.
· The non-compliant falls are so small that we do not consider them significant.
· We conclude that the right-hand site drainage is not a significant factor in site movement.
Left-hand side from street
· There are currently areas of poor site drainage on the left hand side of the house.
· We are not able to determine whether there were compliant falls at the completion of construction
· The ground appears to have been disturbed by an animal.
5. Plumbing leaks
· Plumbing leaks introduce moisture and may cause or affect footing movement by swelling soils causing heaving of footing systems
· There are several minor leaking site services on the site
· We consider that leaking site services are not a significant contributing factor to the footing system movement on this site because either:
(1) they are located away from the house or in location/s where heaving of the footing system is not occurring, or
(2) Alternatively, if they are an influencing factor it is not possible to separately discern their influence because the influence of the trees is so great by comparison.
6. Possible construction contribution
· The available investigations do not identify articulation to services pipe work in accordance with AS2870.
· In our opinion the lack of articulation is not a significant factor in the footings movement.
· If it is a factor, it is not separately discernible due to the overwhelming influence of the trees.
· On the basis of the available investigations it is our opinion that we are unable to identify any possible construction issues which have significantly contributed to the footing movement.
· The construction components considered include the footings system construction, site drainage, plumbing and masonry articulation.
7. Rectification works
· (not reproduced)
The experts report makes it clear that there are no construction issues which have significantly contributed to the footing movement. The builder therefore is not in question as to any of its actual construction work.
The central question then, is whether the builder has complied with Schedule 1 of the defects policy in its dealings with the Engineer such that it would be unfair or unreasonable to require it to rectify the defects.
The Commission filed an “Application for notice requiring witness to attend or produce document or thing” on 19 September 2013 seeking that Mr Greg Anderson attend the hearing together with documents in his or his employers possession. Mr Anderson is an engineer with Structerre Consulting Engineers (Structerre).
In submissions supporting the Application for Mr Anderson to attend, the Commission annexed copies of letters from it requesting Mr Anderson to provide a statement by 14 August 2013. Mr Anderson sent an email in reply on 8 August 2013 advising that his statement was consistent with a previous letter of advice from Mr Avery of the firm dated 30 May 2013.
The Tribunal made an order on 1 October 2013 that Mr Anderson appear at the hearing and produce documents.
Mr Anderson did appear and gave evidence. No Statement of Evidence from him was filed before the hearing. I indicated to the parties that I was concerned that the proceedings were not to be used as a “fishing expedition” to traverse matters which were beyond the scope of this hearing, and were not to be used to obtain evidence which could be used in other proceedings involving the Geotechnical Engineer or Design Engineer. I had in mind other civil or disciplinary proceedings.
I was also concerned that Mr Anderson, or his firm, was not a party to the proceedings, and did not have legal representation. I ruled that I would only allow questions to be asked of Mr Anderson as to the report of Structerre, and be confined to matters of relevance to the defects policy.
I informed Mr Anderson of the provisions of Section 98 of the QCAT Act which provides that the Tribunal under s 98(1)(d) in a hearing may “compel a witness to answer questions the tribunal considers relevant to the proceeding” but that it further provides that:-
98(2) Subsection1 does not allow the tribunal to compel a witness to answer a question if the witness has a reasonable excuse for refusing to answer the question.
98(3) Without limiting subsection (2), it is a reasonable excuse for a witness to refuse to answer a question if answering the question might tend to incriminate the person.
Mr Anderson said that as part of their engagement, that his firm did a contour survey and took photographs of the site. He said that photographs were taken by their surveying staff as a standard procedure to assist the making of a Survey Plan. He said that he signed the Engineers Report, but that he had not personally seen the site (although his firm certainly did) and he was not involved in the design.
He said that he did not see the photographs taken by the survey staff at the time of the survey, but that he has seen them since. He looked at two photographs which were attached to the engineering report[9], and agreed that the lower photograph showed a stand of trees.
[9]SOR p 91.
He said that trees were not shown on the survey plan as it would not be normal to show trees that were not on the allotment.
Mr Anderson said that he did not recall whether he was aware at the time of signing the engineering report that there were trees on or adjacent to the site. He said that he has no recollection of the photos being attached to the report, but they may have been.
Mr Nicholas Miller, a Director of the builder, gave evidence. He said that he did not advise Structerre personally by written confirmation of the trees. He said that he did not know if Structerre took the trees into account as it was 6 -7 years ago.
In an Affidavit Mr Miller said[10]:-
5. The engineering design of the slab was provided by Structerre Consulting Engineers (“the engineers”), dated 26 May 2006. The engineers were aware of the trees on the adjoining property at the time of providing the engineering design. The engineering design contains photos of the trees taken by the engineers at the time of their site visit, prior to designing the slab. I used the engineering design provided by the engineers to construct the slab and footings for the property.
[10]Statement of Evidence, Nicholas Miller, 28 March 2013.
Mr Miller agreed that articulated joints were not used. He said that an alternate was to use flexible pipe, and that “you would never see a house with articulated joints” at the time of construction. He said that a “knuckle” has only been started to be used in Queensland in the last couple of years. He said that flexible pipe was used as it was convenient, and that at the time of building the house, he believed that flexible pipe would work in the same way as a knuckle.
In his affidavit he noted that during his site inspection of the property on 3 July 2012, that a deep wheel rut was evident alongside the property allowing water to pond against the slab[11]. He also noted that[12]:-
The plumbing report provided to the QBSA by F W (Wayne) Keys dated 18 May 2010, notes that the drainage lines contain a significant amount of leaves and other debris. Mr Keys notes that the camera was pushing the leave and other debris towards the house so he stopped the camera investigation. This indicates that proper maintenance of the stormwater lines had not been undertaken by the owner.
[11]Para 26.2.2.
[12]Para 26.2.3.
The homeowner, Mr Choy, gave evidence. He said the property was an investment property, and that it was handed to L J Gilland Real Estate in 2006 as managers who have handled it ever since. He said it had been rented continuously since 2006, and he believed the tenants had changed several times.
Mr Choy said that the property managers were responsible to know if the gutters had filled with leaves, that he had never had the sewer drains professionally cleaned, and that he would not have been aware if trucks had parked near the house.
The Commission had written to Mr Choy on 7 June 2010[13], after investigating his initial complaint, and noted that “Minor movement has occurred which is within acceptable limits and does not adversely affect the structural adequacy, performance or functional use of the dwelling.” In that letter the Commission said:-
To provide a better understanding of the performance requirements of the Australian Standard and your responsibilities as an owner, a copy of BSA’s “Guide to Preventing Structural damage” is enclosed…
[13]Exhibit IH-006 to Statement of Mr Nicholas.
Mr Choy said that he did not recall receiving that letter from the Commission; that he did not have a maintenance schedule for the property, as he left it to the managing agent; that he did not recall referring the letter from the Commission dated 7 June 2010 to the managing agent; and that he did not recall discussing the cracking, or maintenance issues with the managing agent, or ask them to monitor for cracks.
The Authority in its submissions underlined the following provisions of the defects policy[14]:-
B(a) The contractor failing to provide the engineer with the following information
·The location of trees on the site and adjoining site
(b) The contractor failing to obtain written confirmation from a registered professional engineer in Queensland (RPEQ) that:
(vi) the design takes into account site conditions (eg location of trees, easements, fill etc) including all information provided to the engineer about location, site identification and land searches referred to in paragraphs B(a)(ii) and B(a)(iii) above
[14]QBCC Written Submissions para 40.
It then submitted that[15] the Applicant has failed to comply with the above provisions of the Defects Policy, and in particular failed to obtain written confirmation from Structerre about whether the design made provision for the presence of mature trees on an adjoining site. This has subsequently led to the movement of the footing or the slab. In this regard, it was fair to issue the Direction to the Applicant.
[15]QBCC Written Submissions para 41.
I am completely satisfied that the engineer was aware of the trees on the adjoining block at the time of designing the slab. It had before it photographs taken by its own staff which were attached to the engineering report, and clearly show a large stand of trees in the background.
The Defects Policy is described in its opening words as a “guideline policy”. That language is unambiguous. It is clearly intended to provide guidance as to a standard of fairness. That does not suggest that strict compliance with every word is required.
The learned member in Titan Enterprises (Qld) Pty Ltd and Ors v Queensland Building Services Authority[16] noted that:
The Defects Policy is therefore now an article of subordinate legislation, guiding and informing the exercise of the discretion in s 72.
[16][2012] QCAT 389.
The defects policy is a policy to which the Commission is to have regard, and to which the Tribunal will have regard. The effect of it is to assist in the assessment of what is fair. I do not consider that strict compliance with each of its provisions is required having regard to the strict wording only, rather regard is to be had to the intent.
In this matter the Engineer clearly knew about the trees when designing the slab, and attached a photograph of them in its report. What would be the added significance of the builder telling the Engineer that there are trees on the adjoining site, or obtaining written confirmation from the engineer that there are trees on the adjoining site, when the engineer was on site to see them, and is looking at, and attaches, a photograph of them?
There is an argument that the builder has in fact received written confirmation from the engineer that the design takes into account site conditions, when the engineer attaches a photograph of the site (which shows the trees) to the written engineering report.
I consider that as a practical matter the importance is that the Engineer is in fact aware of the presence of trees adjoining the site when designing the slab/footings. The purpose of the guideline is to establish that the engineer has that information when designing the slab/footing and is not designing them in ignorance of some pertinent factor. This would particularly apply to some concealed or obscure factor which the builder is aware of, but which is not immediately apparent to a reasonable and competent professional engineer, so that the engineer can be informed of the factor and take it into account in the design.
In this case there is nothing concealed or obscure in the presence of a large stand of trees that is clearly obvious to the most casual observer.
I consider that in these circumstances the builder was entitled to rely on the Engineering Report. The experts have agreed that the footing design/drawings do not take into account the existing trees on the adjoining property. The failure to take the trees into account was not an action of the builder.
I therefore consider that the builder is within the intent of the Defects Policy in that the Engineer has had the relevant information in front of it, being the presence of the trees; and the builder has been supplied with written confirmation of the Engineer’s awareness of the trees, as a photograph of them is attached to the report.
Accordingly I consider that the builder has effectively complied with Schedule 1 of the Defects Policy, and that (2)(2) of the Policy is applicable to allow an assessment to be made as to whether requiring rectification is unfair or unreasonable.
Having regard to the defects policy, I consider that it would be unfair or unreasonable to require the builder to rectify the work in these circumstances where it has relied on an Engineering Report which was made with knowledge of all relevant factors.
The Commission further submits that[17]:-
the Applicant, as a licensed builder, is responsible for ensuring works are carried out in accordance with the BCA and relevant Australian Standards, and simply following plans designed by an engineer does not, of itself, relieve the Applicant of their responsibility in this regard.
[17]Para 42.
The Commission then refers to a number of relevant cases[18].
[18]R v His Honour Judge Miller and the Builder’s Registration Board of Queensland, ex parte Graham Evans & Co (Qld) Pty Ltd [1987] 2 Qd R 446; Gary Norwood Homes Pty Ltd v QBSA [1997] QBT 193; Schlotterbach and Gardner v QBSA and Patterson [2002] QBT Q009-00 and Q050-00; Fontain v QBSA [2004] QCCTB 163; JM Kelly (Project Builders) Pty Ltd v Queensland Building Services Authority [2010] QCAT 568; Glen Williams Pty Ltd (t/as Glen Williams Constructions Pty Ltd) v QBSA [2012] QCAT 127.
The Commission specifically refers to comments of the learned member in Glen Williams Pty Ltd v Queensland Building Services Authority[19], who said that:-
(16) Whilst I understand Mr Williams concerns that he was merely following the plans prepared by other professionals, the law in this area is now well settled. The QBSA Act is quite specific in making the builder responsible for any defective work, despite the involvement of other professionals. Here, for reasons of consumer protection, the intent of the parliament is to clearly lay responsibility for defective building works squarely at the feet of the builder. As unsettling as this may be for builders, particularly, in circumstances where the professionals Mr Williams relied upon arguably have more specialist training and expertise than does he, it remains the clear intent of the QBSA Act. Moreover, it has previously been held that fault by the builder need not be established in order for rectification to be directed.
[19][2012] QCAT 127, para 16.
The decision in Glen Williams concerned a case where the actual work that the builder performed was defective. The Australian Standard called for joists 225 x 50mm. The floor joists actually utilised were 150mm x 50mm and were installed as a single span greater than the standard. The evidence of the QBSA inspector was that due to the floor joists being undersized, the floor of the house was flexing excessively, thus causing consequential damage to the wall linings and cornices.
That decision cites Fontain v QBSA[20] where it was said that:-
It is the builder’s responsibility to ensure that the building work complies with relevant regulations of the Building Code of Australia
(and further that)
The law is well established that a builder cannot be excused from the responsibility to comply with manufacturers or regulatory body specifications simply because the architect’s drawings were wrong
[20][2004] QCCTB 163.
This matter can be distinguished from that case, and those cases where a builder is doing construction work and following an architect’s drawings. In those cases the builder is dealing with issues where there are available manufacturers standards, regulatory body specifications, or provisions of the Building Code of Australia which can be readily referred to. In this matter however it is not the construction work that is in question.
The experts agree that:-
On the basis of the available investigations it is our opinion that we are unable to identify any possible construction issues which have significantly contributed to the footing movement. The construction components considered include the footings system construction, site drainage, plumbing and masonry articulation.
They clearly identify that:-
Agree the footing design/drawings do not take into account the existing trees on the adjoining property
(and)
The trees are the major contributing factor to the ongoing subsidence at the back of the house.
This matter therefore solely concerns an issue of engineering design. The builder cannot be expected to ensure that an engineering design is sufficient. That is plainly the work of an engineer. It is the very reason that professional engineers are required to be qualified and registered.
It is not absolute that a builder will be liable to rectify defects even though he has followed an architects or other professionals plan or directions. The line of cases considers the type of defect, and whether it is within the reasonable expectation of the knowledge and ability of the builder to be able to assess the suitability of the plan. An experienced builder who follows a plan that it knows, or could reasonably be expected to know, is in error, cannot nevertheless just slavishly follow the plan, but is expected to exercise good construction practice.
The relevance of the expectation of the builder having requisite ability to assess a situation was shown in JM Kelly (Project Builders) Pty Ltd v Queensland Building Services Authority[21] where the learned Member said:-
Mr Scott contends in his report for January 2008 that the architect designed and documented a floor slab which is not waterproof and naturally develops shrinkage cracks. The question for QCAT is whether a builder who constructs a floor slab above a car park which is not waterproof and which its experience tells it, or should tell it, will naturally develop shrinkage cracks through which water will find its way onto the motorcars and other vehicles in the car park, is performing defective work.
[21][2010] QCAT 568 at para 17.
I note that in Glen Williams Pty Ltd v QBSA that the QBSA submitted that the builder there, as the licensed builder, should have been expected to have the knowledge to be capable of determining whether the joists were undersized[22].
[22][2012] QCAT 127 at para 19.
It could not be similarly suggested that a builder should have the knowledge to be capable of determining whether an engineering design of slab/footings is sufficient.
Structerre would no doubt argue that they have relied on the classification of the site by Bowler Geotechnical in drawing their design, and that this classification was incorrect as found by the experts conclave.
This raises yet another level of professional assessment – that not only could the builder not be expected to able to assess whether the engineering of the slab/footing design was proper, but that he could not also be expected to be able to assess whether the geotechnical report and classification, which was prepared by a Registered Professional Engineer, was proper.
Section 72 QBSA Act clearly establishes the consideration of fairness in the ordering of rectification. I do not consider that it could be seen as fair to hold the builder responsible for the design work of an independent Registered Professional Engineer and/or the geotechnical assessment of a separate independent Registered Professional Engineer.
Having regard to the circumstances of the case, to the defects policy, to s 72 of the QBSA Act, and to the clear view of the experts as to the cause of the movement of the footings being related to the design of the slab/footings, I do not consider that it would be fair or reasonable to require the builder to rectify as required by Direction 1.
Whilst the builder did not install articulated fittings to the plumbing, the agreed view of the experts is that the lack of articulation is not a significant factor in the footings movement or that if it is a factor, it is not separately discernible due to the overwhelming influence of the trees.
Whilst the plumbing system using flexible pipe is non-compliant, it has to be shown to be a defect for rectification to be required under s 72 QBSA Act. The Defects Policy defines ‘defective building work” as meaning “building work that is faulty or unsatisfactory”.
I am not satisfied that the plumbing work has been shown to be faulty or unsatisfactory, and therefore Direction 2 to rectify is not required, and it would be unreasonable to require it.
The experts agreed in considering that the non-compliant falls on the right-hand side of the house from the street are so small that they do not consider them significant.
I am therefore not satisfied that the site grading has been shown to be faulty or unsatisfactory, and therefore Direction 3 to rectify is not required, and it would be unreasonable to require it.
The builder has also argued that the homeowner has not conducted proper maintenance as evidenced by the accumulation of leaves in the drains, and that actions of the tenants in parking vehicles close to the slab have caused ponding adjacent to the footings which has damaged them. The homeowner does not have close knowledge of the maintenance of the property, and has not refuted these suggestions, which reinforces my satisfaction that it would be unfair to order rectification by the builder.
I order as to the Application that the decision of the Queensland Building and Construction Commission dated 18 December 2012 to issue Direction to Rectify and/or Complete Number 38333 to Imperial Homes (Qld) Pty Limited is set aside.
Costs
Counsel for the builder sought a costs order against the Commission. He argued that there had been considerable communication between the Commission and the Solicitors for the builder, that there had been no offers of settlement made, and that there had been clear communications about the importance of the engineering issues. He submitted that costs should follow the event, to be assessed or agreed.
The Commission submitted that each party should bear their own costs, but that the parties be at leave to make submissions.
This matter revolved around engineering issues, but ultimately there were no dispute between the parties as to the engineering matters. Those issues were determined and agreed by the experts conclave. Until the time of the experts conclave, those issues were in dispute.
The parties would have needed a reasonable time after the conclave report was received to consider the implications of it, and to consider the future conduct of the matter.
Section 100 of the QCAT Act provides that each party usually bears their own costs, however section 102 provides that the tribunal may make an order requiring a party to a proceeding to pay all or a stated part of the costs of another party to the proceeding if the tribunal considers the interests of justice require it to make the order.
In Ralacom[23] the President, Justice Wilson, noted that:-
Under the QCAT Act the question that will usually arise in each case in which costs are sought is whether the circumstances relevant to the discretion inherent in the phrase ‘the interests of justice’ point so compellingly to a costs award that they overcome the strong contra-indication against costs orders in s 100.
[23] Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No 2) [2010] QCAT 412 at para 29.
As costs have been sought, I will hear further submissions in light of my decision.
I will make orders allowing the parties to make submissions on costs once they have considered this decision. I would urge the parties to have discussions as to costs, if they are sought, before entering into further proceedings, and attempt to resolve any claims between themselves before entering into further dispute.
I note that in Amory v Queensland Building Services Authority[24] the Commission sought and was awarded costs on the District Court scale. In Fenwick v Queensland Building Services Authority[25] costs were awarded against the Commission on that scale. The rectification costs may however fall into the Magistrates jurisdiction (but I have no evidence on that). In the submissions as to costs, the parties should address what is the appropriate scale. I order as to costs that:-
[24] [2012] QCAT 130.
[25][2011] QCAT 262.
1.If either party wishes to seek costs:
(a) The party seeking costs is to file in the Tribunal and give to the other party a clear description of the costs and orders sought, and submissions in support, by 4pm on 28 February 2014.
(b) The other party is to file in the Tribunal and give to the other party submissions in reply by 4pm on 11 March 2014.
(c) The issue of costs will be determined on the papers not before 11 March 2014.
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