JONES and BUILDING SERVICES BOARD
[2015] WASAT 51
•18 MAY 2015
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
ACT: BUILDING SERVICES (REGISTRATION) ACT 2011
CITATION: JONES and BUILDING SERVICES BOARD [2015] WASAT 51
MEMBER: MR C RAYMOND (SENIOR SESSIONAL MEMBER)
MR N HARRISON (SESSIONAL MEMBER)
MR R MACHELL (SESSIONAL MEMBER)
HEARD: 14 JANUARY 2015
DELIVERED : 18 MAY 2015
FILE NO/S: VR 168 of 2014
BETWEEN: MATTHEW JONES
Applicant
AND
BUILDING SERVICES BOARD
Respondent
Catchwords:
Building Services (Registration) Act 2011 (WA) Review of decision refusing registration as a building service practitioner and a building service contractor Consideration of what constitutes 'a building' and 'an incidental structure' Whether experience in carrying out building work for which necessary building permit or building licence was not issued can be taken into account Whether account can be taken of experience gained as supervisor of a subcontractor and when employer undertook to carry out a prescribed building service for another person when not a registered building service contractor - Effect of illegality
Legislation:
Builders Registration Act 1939 (WA)
Building Act 2011 (WA), s 3, s 7, s 7(4)
Building Services (Registration) Act 2011 (WA), s 7, s 9(1), s 17, s 17(1), s 18, s 18(1)(d), s 21, s 21(1), s 21(2)
Building Services (Registration) Regulations 2011 (WA), reg 4, reg 6, reg 12, reg 13(1), reg 16, reg 21, Pt 2
Result:
Application refused
Summary of Tribunal's decision:
The applicant applied for a review of a decision made by the Building Services Board refusing his application for registration as a building service practitioner.
The applicant claimed to be entitled to be credited with 9.3 years' experience in the supervision of building work. Virtually all of the applicant's experience related to the construction of retaining walls and shade structures. The Tribunal examined the nature of the structures which constitute a building and an incidental structure, and concluded that the vast majority of the work undertaken by the applicant constituted neither a building nor an incidental structure. The Tribunal concluded that the application for review had to be refused, but went on to consider a number of other issues raised by the application.
The Tribunal concluded that the legislation did not convey an intention that experience should not be credited due to illegality as a result of the applicant's employer contracting work for another without being registered as a building services contractor, and by reason that the applicant had failed to apply for an owner/builder's licence when he should have done so. The breaches did not affect the quality of the supervision provided by the applicant so that the sanction of refusing to assess an appropriate credit of experience was disproportionate. In the case of the applicant's employer contracting to carry out such work, the applicant was not aware of the breach and the circumstances fell within one of the accepted exceptions within which the courts would not refuse to enforce a contract tainted by illegality. The Tribunal found that the legislation did not convey an intention that appropriate experience should not be credited. The Tribunal found that the applicant was entitled to be credited with experience in supervising a subcontract workforce and in respect of the experience gained in circumstances when his employer had breached s 7 of the Building Act 2011 (WA), as well as for the period when the applicant had carried out owner/builder work.
Category: B
Representation:
Counsel:
Applicant: Ms A Dowley
Respondent: Mr E Homan
Solicitors:
Applicant: Encore Legal Pty Ltd
Respondent: Evan Homan
Case(s) referred to in decision(s):
Alcan (NT) Alumina Pty Ltd v Commissioner of Northern Territory Revenue [2009] 239 CLR 27
Commissioner for Railways (NSW) v Agalianos (1955) 92 CLR 390
Commodore Homes WA Pty Ltd and Deegan & Anor [2007] WASAT 45
Fitzgerald v FJ Leonhardt Pty Ltd (1997) 189 CLR 215
Genovese and Building Services Board [2012] WASAT
Nelson v Nelson (1995) 184 CLR 538
Project Blue Sky v ABA (1998) 194 CLR 355
Reitsema and Building Services Board [2013] WASAT 132
REASONS FOR DECISION OF THE TRIBUNAL:
Introduction
The applicant applied to the Building Services Board (Board) to be registered as a building service practitioner and building service contractor pursuant to s 17 and s 18 respectively of the Building Services (Registration) Act 2011 (WA) (Registration Act). On 14 August 2014, the Board notified the applicant of its decision to refuse the applicant's application for registration as a building service provider. It is a prerequisite to the grant of registration as a building service contractor, in the case of an individual, that registration as a building service practitioner be held. The applicant has applied for a review of the Board's decision and it is common cause that if the review is successful, the applicant will be entitled to registration as a building service contractor.
In its reasons for decision, the Board concluded that the scope of the applicant's experience relied on by the applicant was not relevant so that no verifiable experience had been credited for the purpose of gaining registration as a building service practitioner. The Board also declined to credit the applicant with experience claimed in the carrying out of building work between April and June 2001 which the applicant undertook as an owner/builder. The applicant had not applied for a building licence as required under the Builders Registration Act 1939 (WA) (BR Act) because he understood that the value of the works was below the then relevant threshold for which a building licence was required. In this the applicant was wrong. A building licence was required and the Board concluded that credit could not be given because the work was performed without the requisite owner/builder licence.
As will appear further below, in order to qualify for registration as a building service practitioner, the applicant must demonstrate that he has been carrying out or supervising building work for periods totalling at least the equivalent of seven years' fulltime work. The applicant contends that, having regard to his above owner/builder experience and the experience gained in 27 other projects detailed in his application, he should be credited with a total of 9.3 years' experience. The 27 projects obviously relate to work specific to each project. In a table prepared by the applicant, he describes each project in very similar terms as involving construction, erection, assembly and placement of class 10 engineered incidental structures, siteworks and ground levelling, including retaining walls. The reference to a class 10 structure is a reference to that particular class being one of the various classes described in the National Construction Code (NCC). The NCC class 10 refers to a nonhabitable building structure of two types, being class 10a and class 10b. Class 10a is a private garage, carport, shed or the like. Class 10b is a structure being a fence, mast, antenna, retaining or freestanding wall, swimming pool or the like. In the applicant's written submissions to this Tribunal, it was submitted that the nonhabitable buildings or structures involved in these projects should be more properly regarded as buildings, if they are not incidental to a superior class of structure.
The documentation provided by the applicant in relation to each of the projects shows that the structures erected (which term is used nonjudgmentally, it being understood that the applicant contends that these structures are to be classed as, in some cases, buildings, and in other instances, incidental structures) varied in design to some extent, although none are fully enclosed by walls. The roofs of these structures also vary; there is one which has a Colorbond roof, but others have no more than pergola-like beams, and some structures are not fully covered by a roof but have triangular shade materials which provide partial cover. In an email addressed to the Building Commission dated 22 August 2014, a representative of the company which employs the applicant, Landscape Australia Pty Ltd (Landscape Australia), stated:
We are a commercial landscaper and we regularly submit building permit applications for retaining walls and shade structures.
We consider that this is an accurate generic description of the type of structures involved in the applicant's projects in relation to which his building experience is claimed.
The above email communication is part of a series of email communications incorporated in Appendix B included in the hearing book. This exchange of emails reflects the practical difficulty which arises in this case. The communications demonstrate that some local governments require Landscape Australia to apply for building permits in respect of the shade structures, while others do not. In an email from a representative of the City of Swan dated 22 August 2014, a distinction was drawn between a particular shade structure which had a solid Colorbond roof as opposed to those having a shade sail or pergolatype structure. It appears the City of Swan regards the former as a class 10a building in its own right. In an email from the Standards Manager of the Building Commission, also dated 22 August 2014, a view is expressed that the shade structures concerned provide shelter for people and are therefore viewed as buildings.
The Board takes an entirely different view to that of the Standards Manager of the Building Commission and the representative of the City of Swan. This different view is based on the Board's construction of the Registration Act, the Building Services (Registration) Regulations 2011 (WA) (Registration Regulations) and various definitions contained within the Building Act 2011 (WA) (Building Act).
During the course of the hearing, it became apparent that one of the possible outcomes was that the Tribunal might regard some particular structures in some projects as constituting buildings, or that some structures might be regarded as incidental structures, and that some retaining walls might be regarded as incidental and others not. This could only be ascertained by a detailed consideration of each and every project, and it was evident that there was insufficient evidence before the Tribunal for this purpose. After discussion, it was agreed between counsel for the parties that if the applicant's submissions as to what might constitute a building, or incidental structure, were accepted, the most expedient course would be to uphold the review, set aside the respondent's decision and direct the Board to make the necessary assessment after providing the applicant with an appropriate opportunity to furnish further evidence.
Subject to this agreement, the following issues will be determinative of the application for review.
The issues
The issues determinative of the matter, having regard to the statutory scheme, are the determination of:
1)what constitutes 'a building';
2)what constitutes 'an incidental structure';
3)whether time spent by a supervisor of a subcontractor, in supervising the subcontractor's workforce, should be credited; and
4)whether it is permissible to credit experience in carrying out or supervising building work if:
a)the applicant's employer contracted to carry out the work in breach of the statutory requirement that a person must not undertake to carry out a prescribed building service unless the person is a building service contractor (s 7 of the Registration Act) (subject to certain exceptions);
b)the applicant has carried out building work as an owner/builder, but without applying for an owner/builder's licence as required at the applicable time under the BR Act.
The statutory regime
Section 17(1) of the Registration Act sets out the requirements for registration of building service practitioners as follows:
Registration of building service practitioners
(1)The Board must register, or renew the registration of, an applicant as a building service practitioner in each class of building service practitioner applied for if the Board is satisfied that the applicant ‑
(a)has complied with sections 13 and 14; and
(b)has the qualifications and experience prescribed by the regulations for that class of building service practitioner; and
(c)is a fit and proper person to be registered; and
(d)has complied with any other requirements prescribed by the regulations for registration as a building service practitioner in that class.
Section 17(1)(a) of the Registration Act deals with the formalities of applying for registration as a building service practitioner in a class of building service practitioner. Section 9(1) of the Registration Act provides that 'an individual may be registered under section 17 as a building service practitioner in a class of building service practitioner prescribed by the regulations'. It is common cause that the applicant has met all of the requirements of s 17(1) other than s 17(1)(b) and s 17(1)(c) of the Registration Act.
Regulation 6 of the Registration Regulations prescribes only five classes of building service practitioner, being a building practitioner, a building surveying practitioner level 1 and level 2, a building surveying practitioner technician, and a painting practitioner. There are corresponding classes of building service contractor but allowing for individual, partnership and company registration.
Part 2 of the Registration Regulations deals with builders, building service providers, building practitioners, and building contractors.
It is not necessary to address in detail the requirements relating to registration as a building service contractor. In the case, as here, of an individual registration, the building service contractor must be a building service practitioner in the same class (s 18(1)(d) read with s 21(1) and s 21(2) of the Registration Act). A building service contractor carries out builder work as the person named as the builder on a building permit (reg 21 of the Registration Regulations). In order to be registered as a building service contractor it is necessary to satisfy various conditions including those relating to financial and insurance requirements (s 18 of the Registration Act). It is common cause that the applicant meets all other requirements relating to registration of a building service contractor save the requirement to be a building service practitioner under s 21 of the Registration Act.
'Builder work' is defined by reg 13(1) of the Registration Regulations as follows:
builder work means building work ‑
(a)for which a building permit is required; and
(b)with a value of $20 000 or more based on the value of the work estimated under Schedule 2; and
(c)carried out in an area of the State set out in Schedule 3,
but does not include the following types of building work ‑
(d)construction of a farm building;
(e)production of a prefabricated or transportable building in a manufacturing yard;
(f)formation of a parking area;
(g)formation of outdoor sporting surfaces including associated fencing and lighting;
(h)construction of walkways, viewing and gathering platforms that do not form part of another building;
(i)construction of a water tank that is not incorporated into the structure of another building;
(j)construction of an incidental structure as defined in the Building Act 2011 section 3;
(k)installation of fire sprinklers, free standing partitioning, safety systems, timber decking or glazing;
(l)cabinet making and installation;
(m)joinery (2nd fixing) work[.]
Regulation 4 of the Registration Regulations prescribes that a prescribed building service, amongst other types of work, is builder work as the person named as the builder on a building permit.
Regulation 16 of the Registration Regulations sets out the qualifications and experience required for registration as a building practitioner by way of five different sets of pathways. In this case, the applicant applies under set 1. The relevant part of reg 16 of the Registration Regulations provides as follows:
Qualifications and experience: building practitioners
(1)For the purposes of section 17(1)(b) a qualification (if any) listed in a set in the Table, together with the experience listed in the same set, are prescribed as qualifications and experience for building practitioners.
Table
Qualifications
Experience
Set 1
(a) CPC50210 Diploma of Building and Construction (Building) as described in the CPC08: Construction, Plumbing and Services Training Package published by Training.gov.au including the following units ‑
(i) CPCCBC4005A ‑ Produce labour and material schedules for ordering;
(ii) CPCCBC4018A ‑ Apply site surveys and set‑out procedures to building and construction projects;
(iii) CPCCBC5005A ‑ Select and manage building and construction contractors;
(iv) CPCCBC5007A ‑ Administer the legal obligations of a building construction contract;
(v) CPCSUS5001A ‑ Develop workplace policies and procedures for sustainability;
(vi) CPCCBC4014A ‑ Prepare simple building sketches and drawings;
(vii) CPCCOHS1001A ‑ Work safety in the construction industry;
or
(b) an equivalent qualification as determined by the Board.
carrying out or supervising building work for periods totalling at least the equivalent of 7 years full‑time
Sets 1 to 5 set out varying qualifications and experience level. The manner in which these sets operate is discussed fully in Reitsema and Building Services Board [2013] WASAT 132 (Reitsema). It is sufficient, for present purposes, to note simply that there is a clear distinction between experience required in building work under set 1 and the experience required under the other sets in carrying out or supervising building construction.
The phrase 'building construction' is not defined, whereas 'building work' is defined by reg 12 of the Registration Regulations as having the meaning given to that phrase in s 3 of the Building Act, where 'building work' is defined as follows:
building work means ‑
(a)the construction, erection, assembly or placement of a building or an incidental structure; or
(b)the renovation, alteration, extension, improvement or repair of a building or an incidental structure; or
(c)the assembly, reassembly or securing of a relocated building or a relocated incidental structure; or
(d)the changing of ground levels of land for the purposes of work of a kind mentioned in paragraph (a), (b) or (c) to an extent that could adversely affect land beyond its boundaries; or
(e)site work on any land for the purposes of, or required because of, work of a kind mentioned in
(i)paragraph (a), (b), (c) or (d); or
(ii)paragraph (a) or (b) of the definition of demolition work;
or
(f)other prescribed work,
but does not include work of a kind prescribed for the purposes of this definition as not being building work[.]
'Incidental structure' is also defined by s 3 of the Building Act as follows:
incidental structure means a structure attached to or incidental to a building and includes ‑
(a)a chimney, mast, swimming pool, fence, free‑standing wall, retaining wall or permanent protection structure; and
(b)a part of a structure[.]
What constitutes a building?
In Reitsema, the Tribunal noted that neither the Registration Act nor the Registration Regulations define 'building'. Further, under the Building Act, building itself is not defined other than as including a part of a building. What constituted a building was not in contention in Reitsema and the Tribunal adopted the definition contained in the Macquarie Dictionary (5th ed, 2009) (Macquarie Dictionary):
building … /n. 1. a substantial structure with a roof and walls, as a shed, house, department store, etc …
It is this meaning of the term 'building' which the respondent adopts in its submissions. The applicant contends that a broader definition should be applied and refers to definitions of a building used in different contexts. Reference is made to a definition used by the Australian Capital Territory Planning Land Authority which, it is submitted, provides the following meaning of 'building':
Building includes ‑
1.a structure on or attached to land
2.an addition to a building and
3.a structure attached to a building and
4.fixtures and
5.part of a building whether the building is completed or not.
Reference is further made to the definition of 'building' contained in the now repealed BR Act which was in the following terms:
building means any building of a permanent nature used or intended to be used for residential, professional, manufacturing, trading, commercial, hospital, institutional, assemblage, or public purposes, but does not include a farm building, and the term used as an abstract noun means the erection or structural alteration of any such building.
The applicant also refers to the NCC description of class 10 buildings, to which reference has already been made, which is set out in a manner which suggests that a carport is regarded as a building rather than a structure, given that class 10b refers to a structure being a fence, mast, antenna, retaining or free‑standing wall, swimming pool or the like.
With respect, the above definitions relied on by the applicant are not of any assistance. It is a principle of statutory construction that the task must commence with a consideration of the text itself, although this may require consideration of the context, including the general purpose and policy of a provision: Alcan (NT) Alumina Pty Ltd v Commissioner of Northern Territory Revenue [2009] 239 CLR 27. The definition of 'building work' defined by reg 12 of the Registration Regulations, read with s 3 of the Building Act, distinguishes between the concept of a building and that of an incidental structure. An 'incidental structure' means a structure attached to or incidental to a building. The language therefore conveys a clear distinction between a building and a structure. Otherwise, the definition of 'building work' could be expected to refer to the construction, erection, assembly or placement of a building or structure, or an incidental structure.
Insofar as the former definition used in the BR Act is concerned, the definition does not define what a building is, but limits the meaning to buildings having particular characteristics. It is, in any event, not helpful for the same reasons as given in the preceding paragraph. As discussed in Reitsema, the concept of 'building work' has considerably broadened the nature of work in relation to the carrying out or supervision of building work which is to be regarded as building work by reason of the extension to cover incidental structures.
It can be concluded that by not providing a definition of what constitutes a building, the legislature has intended that the term be given its ordinary meaning. That ordinary meaning can best be gleaned from dictionary definitions.
The Macquarie Dictionary definition has already been referred to above. That definition presents an obvious difficulty for the applicant insofar as it includes a requirement that a building have walls.
The Australian Oxford Dictionary, 2nd ed, contains the following definition:
building .. n. 1. a permanent fixed structure forming an enclosure and providing protection from the elements etc. (e.g. a house, school, factory, or stable).
These definitions convey that the structure must be permanent or substantial and that an element is that the structure be enclosed and provide protection from the elements.
The manner in which buildings are constructed and designed is subject to change and innovation over time. It is therefore necessary to attempt to apply the legislative scheme in a practical manner. It may be that a structure is not fully walled but is so designed as to provide adequate protection, or that a structure does not cease to be a building because the roof does not cover the entire structure. It must necessarily be a matter of fact and degree in each case to determine at what point a structure can be properly classified as a building.
What is an incidental structure?
As already pointed out, in the original application to the Board, the applicant submitted that all of the structures (many of which are now contended to be buildings) are incidental structures. In the email communications of 22 August 2014 discussed above, the project manager of the applicant's employer, Landscape Australia, described the activities of the applicant as a commercial landscaper which regularly submitted building applications for retaining walls and shade structures.
The applicant now contends that the retaining walls constructed in the various projects are incidental structures. In some cases, the retaining walls are of little height and might not be regarded as essential to the particular development. In other cases, the retaining walls are substantial and are required in order that residential buildings can be constructed on the retained land. It was submitted that, in some cases, a developer will construct retaining walls and sell the land in a combined land and house package. On either basis, it was submitted that the retaining wall is therefore incidental to a building within the definition of the term used in the Building Act.
Counsel for the respondent challenged these submissions and submitted that a structure can only be incidental to what he referred to as a building which is 'conceived'.
The Macquarie Dictionary defines 'incidental' as follows:
incidental .. adjective 1. happening or likely to happen in fortuitous or subordinate conjunction with something else.
The long title of the Building Act describes it as an Act to provide for, amongst other things, permits for building work and demolition work, and standards for the construction or demolition of buildings and incidental structures. When regard is had to the definition of 'building work' and 'incidental structure', there is a primacy given to activities relating to the construction or repair of buildings. The construction of structures which are not buildings are only building work if subordinate to a building.
Again, in our view, the legislation must be applied in a practical and common sense manner so that it will be a matter of fact and degree in each case as to whether or not it can be said that an incidental structure, such as a retaining wall, is incidental to a building. It clearly is so when a building permit is applied for in respect of the construction of both a building and retaining walls at the same time. We do not consider that retaining walls can be said to be incidental to a non-existent building which has not yet been designed.
Are any of the structures referred to in the application either a building or an incidental structure?
If the applicant's submissions in relation to what constituted either a building or an incidental structure had been accepted (which they have not), then all of the structures, generally described as shade structures, would be regarded as buildings, and the retaining walls would have been regarded as incidental structures thereto. On the conclusions we have expressed, the shade structures are not buildings and the retaining walls are not incidental structures, at least to the extent that they rely on a relationship to the shade structures.
In circumstances in which a developer has subdivided a large tract of land, has contracted with Landscape Australia to provide a landscaped area, and has sold off smaller parcels of land on which residential houses have later been designed and constructed, neither the shade structures, nor retaining walls, can be regarded as incidental structures.
The applicant did inform the Tribunal that in some developments, retaining walls were constructed after construction had commenced on residential houses within the overall development. It was also submitted by counsel for the applicant that it was possible that in the case of some developments, retaining walls had been constructed to enable houses to be constructed in accordance with a land and housing package arrangement. If houses had been designed prior to the letting of the contract for the retaining walls, it might be open to argue that the retaining walls were incidental to an identifiable, although not yet existing, building. It is only in such a circumstance in which the applicant would be entitled to an assessment of the credit to which he is entitled for his involvement in carrying out or supervising the relevant building work involved. Although the Board accepts that some projects in which the applicant was engaged do involve the carrying out of building work relating to incidental structures; namely, projects 5, 7 and 23, as referred to in the table of projects prepared by the applicant, the experience claimed by those projects and the other projects asserted by the applicant to be clearly incidental buildings (projects 2, 7, 13, 19 and 21), in any event, fall well short of the requisite seven year period.
If we had concluded that the applicant was entitled to a credit in relation to experience involved in construction of retaining walls more generally, the understanding reached between the parties that the matter should be referred back to the Board for that assessment to take place would have been appropriate. But, we do not consider that course appropriate, based on the conclusions to which we have come. It follows that the application for review must be refused.
Because of this conclusion, it is not strictly necessary for us to express any views in relation to whether the applicant is entitled to credit for building work carried out in breach of s 7 of the Building Act, or in relation to which the applicant failed to apply for an owner/builder's licence (the work concerned having been carried out prior to the repeal of the BR Act). However, as the principles raised have come before the Board previously and are likely to do so in the future, we shall express our views shortly.
The effect of illegality
The issue arises in two circumstances. Firstly, the Board contends that Landscape Australia has, on occasions, breached s 7 of the Building Act by contracting to carry out a prescribed building service for another person, when Landscape Australia was not a building service contractor. The second circumstance is that the applicant carried out building work in circumstances in which he should have applied for an owner/builder licence under the BR Act.
In Genovese and Building Services Board [2012] WASAT 244 (Genovese), the Tribunal accepted, without giving any reasons, a submission on behalf of the Board that it would be contrary to public policy to enable a person to benefit from works which were not lawfully carried out. In the interests of consistency and to avoid bringing the Tribunal's processes into disrepute, the Tribunal should follow earlier decisions unless persuaded they are clearly incorrect: see the principles discussed in Commodore Homes WA Pty Ltd and Deegan & Anor [2007] WASAT 45. However, as no reasons were given in Genovese for the conclusions referred to above, we should not be constrained to follow that decision.
In Project Blue Sky v ABA (1998) 194 CLR 355, Brennan CJ stated that the primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute, and that the meaning of the provision is to be determined by reference to the language of the instrument viewed as a whole. Reference was made to Commissioner for Railways (NSW) v Agalianos (1955) 92 CLR 390 at 397 as authority for the proposition that the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed.
Section 7 of the Registration Act provides, relevantly, as follows:
(1)A person must not carry out, or undertake to carry out, a prescribed building service for any other person unless the person is a building service contractor entitled under section 11 to carry out that building service.
Penalty: a fine of $25 000.
(2)Subsection (1) does not apply to the following ‑
(a)a person who carries out a prescribed building service as an employee of a building service contractor entitled to carry out that building service;
(b)a person who is ‑
(i)a public authority; or
(ii)an officer or employee of a public authority, in so far as that person directs or supervises the carrying out of a prescribed building service in the performance of the person’s duties as such an officer or employee;
(c)the person is a person, or in a class of persons, prescribed by the regulations for the purposes of this section.
(3)Subject to subsection (4), a person is not entitled to any monetary or other consideration in respect of anything the person did in contravention of subsection (1).
(4)A person is not stopped under subsection (3) from claiming reasonable remuneration for carrying out a prescribed building service, but only if the amount claimed ‑
(a)is not more than the amount paid by the person in supplying materials and labour for carrying out the building service; and
(b)does not include allowance for any of the following ‑
(i)the supply of the person’s own labour;
(ii)the making of a profit by the person for carrying out the building service;
(iii)costs incurred by the person in supplying materials and labour if, in the circumstances, the costs were not reasonably incurred;
and
(c)is not more than any amount agreed to as the price for carrying out the building service; and
(d)does not include any amount paid by the person that may fairly be characterised as being, in substance, an amount paid for the person’s own direct or indirect benefit.
(5)A building service contractor who has entered into a contract to carry out a prescribed building service must not enter into a contract with another person for the other person to carry out the building service (or any part of the building service) for the contractor unless the other person is a building service contractor entitled to carry out that building service.
Penalty: a fine of $25 000.
The effect of the above provision is that, although it is not open to sue on a contract for the recovery of a contract entered into in breach of s 7(1) of the Registration Act, the party in breach is able to recover the costs of materials and labour supplied by others. The statute therefore expressly preserves some rights for the benefit of a person in breach of s 7(1) of the Registration Act.
The High Court examined the effect of illegality in relation to contracts tainted by illegality in Fitzgerald v FJ Leonhardt Pty Ltd (1997) 189 CLR 215. McHugh and Gummow JJ referred to four exceptions to the principle that courts should refuse to enforce a contract tainted by illegality on grounds of public policy. One of the exceptions (at 229) is where the claimant was ignorant or mistaken as to the factual circumstances which render an agreement or arrangement illegal. At 230, their Honours approved the statement of McHugh J in Nelson v Nelson (1995) 184 CLR 538 at 613 as follows:
Accordingly, in my opinion, even if a case does not come within one of the four exceptions … to which I have referred, courts should not refuse to enforce legal or equitable rights simply because they arose out of or were associated with an unlawful purpose unless: (a) the statute discloses an intention that those rights should be unenforceable in all circumstances; or (b)(i) the sanction of refusing to enforce those rights is not disproportionate to the seriousness of the unlawful conduct; (ii) the imposition of the sanction is necessary, having regard to the terms of the statute, to protect its objects or policies; and (iii) the statute does not disclose an intention that the sanctions and remedies contained in the statute are to be the only legal consequences of a breach of the statute or the frustration of its policies.
In this case, there is no evidence to suggest that the applicant participated in the negotiations or any contract to carry out a prescribed building service in breach of s 7 of the Registration Act. Once it was ascertained that a building service contractor was required, Landscape Australia entered into arrangements to ensure that the necessary work was carried out by a building service contractor.
The Tribunal was informed that Landscape Australia did not know when the local authority might require that a building permit be issued to a building service contractor for the carrying out of the work. For present purposes, we accept that to be the case, although, in the event that any later application might be made by the applicant, this is an issue which might require far more detailed evidence. However, if the applicant is correct in its assertion, it would appear that the exception referred to above would apply. In any event, the Registration Act does not disclose an intention that Landscape Australia's rights under any effective contract should be unenforceable in all circumstances. To the contrary, as pointed out above, particular rights are preserved.
Further, insofar as the applicant is concerned, the Registration Act and the Building Act are cognate pieces of legislation which must be read together when considering whether there is any statutory intention that the experience gained by an applicant should not be credited in either of the circumstances to which we have referred.
It is difficult to glean any policy reason which indicates that the sanction of refusing to credit experience, which is otherwise appropriate, would be proportionate to the seriousness of the unlawful conduct constituting a breach of s 7 of the Building Act. The relevant purpose of the Registration Act is to ensure competency of those who are registered as building service practitioners. Section 17(1)(c) of the Registration Act requires that an applicant be fit and proper, so if an applicant deliberately flouts the law, that would be a matter which could be taken into account. In an appropriate case, registration could be refused because the Board is not satisfied that an applicant is a fit and proper person. It should be observed that the former BR Act had no equivalent provision to s 7(4) of the Building Act and did not have an equivalent fit and proper requirement in respect of an applicant applying under the most comparable pathway which existed under that legislation. This may be a basis for distinguishing and justifying the exclusion of experience in similar circumstances under that former regime. But we are unable to find an intention that the legislature requires appropriate experience to be disregarded under the current regime.
We turn to address the remaining issues.
Supervision of a subcontractor workforce
When Landscape Australia ascertained that a building permit was required to be issued to a building service contractor, it entered into a contract with a registered building service contractor to enable the work considered by the relevant local authority to constitute builder work to be carried out. Only that particular component of the work was carried out by the building service contractor, and even then, the work which the applicant would ordinarily have undertaken would be carried out by Landscape Australia under the overall legal supervision of that building service contractor. The applicant nevertheless supervised those carrying out the work.
Most building work in the cottage industry is carried out by subcontractors. A person commencing in a particular trade would ultimately gain sufficient experience to supervise his or her work colleagues. The term 'supervising building work' referred to in pathway set 1 of reg 16 of the Registration Regulations cannot mean the legal supervision for which the registered building service contractor is responsible. It is a reference to a level of supervision carried out in the course of gaining experience sufficient to obtain registration as a building services practitioner and, therefore, a building service contractor.
In our view, there is no reason why experience gained in the supervision of a subcontract team should be excluded from consideration in assessing the experience to which an applicant may be entitled to be credited.
The supervision carried out by the applicant was no different in those instances when any particular project was completed without the services of a building service contractor being necessary. The applicant would therefore be entitled to a credit in respect of such experience.
Owner/builder experience
The applicant provided full details of the project in relation to which he carried out building work as an owner/builder. The owner did not apply for an owner/builder's licence. The reason given for not doing so, as reflected in the applicant's submission, was that the value of the work was $15,000 and therefore under the $20,000 exemption. However, at the relevant time when the work was undertaken, during April to June 2001, the exemption applicable under the then legislation was only $12,000 so that a building licence was required.
This was a single omission. There is no demonstrated course of conduct of deliberately avoiding applying for building licences under the old regime, or building permits under the current regime. The quality of work done is available for inspection and assessment by the Board. The quality of the experience gained by the applicant is not affected and, in our view, should be taken into account.
Conclusion
Based on the above findings, as the majority of the projects undertaken would not have given the applicant experience which should be taken into account, we do not consider it appropriate to refer the matter back to the Board with appropriate directions for further particulars of relevant projects to be provided.
On the information before the Tribunal, the applicant does not have sufficient appropriate experience. In the circumstances, the more appropriate way by which to dispose of the matter is to refuse the application and confirm the decision under review, albeit for reasons which differ from those of the Board. This will enable the applicant to assess his position in the light of the findings made by the Tribunal. If the applicant considers that there is sufficient of the retaining wall work, or any other work, which might arguably constitute the construction of an incidental structure, he will be free to make a further application to the Board with full details supporting that application, which will then not be confused by inclusion of irrelevant material.
Orders
We shall accordingly cause orders to issue as follows.
1.The decision under review is affirmed.
2.The application for review is refused.
I certify that this and the preceding [60] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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MR C RAYMOND, SENIOR SESSIONAL MEMBER
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