Keller Constructions (WA) Pty Ltd v Builders' Registration Board of Western Australia
[2011] WASCA 163
•28 JULY 2011
KELLER CONSTRUCTIONS (WA) PTY LTD -v- BUILDERS' REGISTRATION BOARD OF WESTERN AUSTRALIA [2011] WASCA 163
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2011] WASCA 163 | |
| THE COURT OF APPEAL (WA) | |||
| Case No: | CACR:84/2010 | 3 MARCH 2011 | |
| Coram: | PULLIN JA NEWNES JA HALL J | 28/07/11 | |
| 20 | Judgment Part: | 1 of 1 | |
| Result: | Appeal allowed | ||
| A | |||
| PDF Version |
| Parties: | KELLER CONSTRUCTIONS (WA) PTY LTD BUILDERS' REGISTRATION BOARD OF WESTERN AUSTRALIA |
Catchwords: | Building and construction Builders' Registration Act 1939 (WA), s 4 Appellant engaged to construct footings for 67 prefabricated transportable buildings and attach transportable buildings to the footings Whether contract or engagement to construct a 'building' Whether attaching to footings was to 'add to' or 'alter' transportable buildings Meaning of 'construct' Whether transportable building a 'building of a permanent nature' before or after attached to footings Meaning of 'building of a permanent nature' |
Legislation: | Builders' Registration Act 1939 (WA), s 4 |
Case References: | Builders' Registration Board of Western Australia v Roroka Pty Ltd (Unreported, WASC, Library No 8776, 25 March 1991) Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 Robinson v Local Board for the District of Barton-Eccles, Winton & Monton (1883) 8 App Cas 798 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA TITLE OF COURT : THE COURT OF APPEAL (WA) CITATION : KELLER CONSTRUCTIONS (WA) PTY LTD -v- BUILDERS' REGISTRATION BOARD OF WESTERN AUSTRALIA [2011] WASCA 163 CORAM : PULLIN JA
- NEWNES JA
HALL J
- Appellant
AND
BUILDERS' REGISTRATION BOARD OF WESTERN AUSTRALIA
Respondent
ON APPEAL FROM:
Jurisdiction : SUPREME COURT OF WESTERN AUSTRALIA
Coram : MURRAY J
Citation : BUILDERS' REGISTRATION BOARD OF WA -v- KELLER CONSTRUCTIONS (WA) PTY LTD [2010] WASC 119
File No : SJA 1004 of 2010
(Page 2)
Catchwords:
Building and construction - Builders' Registration Act 1939 (WA), s 4 - Appellant engaged to construct footings for 67 prefabricated transportable buildings and attach transportable buildings to the footings - Whether contract or engagement to construct a 'building' - Whether attaching to footings was to 'add to' or 'alter' transportable buildings - Meaning of 'construct' - Whether transportable building a 'building of a permanent nature' before or after attached to footings - Meaning of 'building of a permanent nature'
Legislation:
Builders' Registration Act 1939 (WA), s 4
Result:
Appeal allowed
Category: A
Representation:
Counsel:
Appellant : Mr P J Urquhart
Respondent : Ms L B Black
Solicitors:
Appellant : Hotchkin Hanly
Respondent : Builders' Registration Board
Case(s) referred to in judgment(s):
Builders' Registration Board of Western Australia v Roroka Pty Ltd (Unreported, WASC, Library No 8776, 25 March 1991)
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355
Robinson v Local Board for the District of Barton-Eccles, Winton & Monton (1883) 8 App Cas 798
(Page 3)
1 JUDGMENT OF THE COURT: The appellant was charged with an offence under the Builders' Registration Act 1939 (WA) (the Act), in that, not being a registered builder, it entered into an engagement to construct a building for a fee exceeding $20,000, contrary to s 4(1)(A)(b) of the Act. The charge was dismissed in the Magistrates Court and the respondent appealed. Murray J allowed the appeal, set aside the decision dismissing the charge and entered judgment of conviction against the appellant. The appellant now appeals against the decision of Murray J.
2 On 9 August 2010, Mazza J granted the appellant leave to appeal on grounds 1, 2 and 3 of its grounds of appeal and referred ground 4 to the hearing of the appeal.
Background
3 The material facts were not in dispute on the appeal. Kintail Investments Pty Ltd (Kintail) had a contract to develop a site at Karratha, upon which were to be located 67 prefabricated transportable accommodation units (the units). The units were to be affixed to the land. Because Karratha is in a cyclone-prone area, the units had to be capable of withstanding cyclones.
4 Kintail entered into a contract with Blue Ridge Pty Ltd (Blue Ridge) to manufacture the units, and a separate lump sum contract with the appellant to prepare the site and install the units once they had been transported to the site by Kintail. The lump sum contract between Kintail and the appellant, which was signed on 15 October 2007, was for the sum of $2,699,777. The contract described the work to be carried out by the appellant. The work included surveying the site and a substantial amount of general earthworks and road works, together with electrical, sewer and water distribution and sundry associated work. The roads on the site were to be sealed and kerbed, and concrete pathways were to be provided. The work also involved preparing footings for each of the units and attaching the units to the footings. Verandas were to be attached to the units once they were in place, although at the trial the magistrate was unable to conclude whether the veranda was a roofed structure or simply a concreted area linked to the unit.
5 Each item of work, generally described, was separately costed. The work of preparing the footings and attaching the units to them was costed at $198,200. The average cost per unit for that work therefore worked out at just under $3,000.
(Page 4)
6 Under the terms of the appellant's engagement, the units were to be transported to the site where they were to be placed on the footings prepared by the appellant. The footings were to consist of concrete piles, sunk 1.5 m into the ground and topped with steel plates which were embedded in the concrete. The underside of each of the units had a steel frame to which the floor and the rest of the unit was affixed. The steel plates on the footings were to be welded to this frame. Once the unit was secured to the footings in that way, the service connections were to be made - electricity, sewerage, water and the communication system. Separate provision was made for the reticulation of gardens, drainage works, installation of culverts and fencing.
7 It is clear that any unit could be removed from the site by grinding away the welds by which it was attached to the footings. But although the land was the subject of a 10 year lease, there was no evidence to suggest it was intended the units would be removed upon the expiry of the lease or at any other time. At the trial, Mr McKenzie, a director of Kintail, said that the units were to remain on the relevant site 'indefinitely, as with any other village that had been constructed up in Karratha'. Asked if there was any possibility of the units remaining on the site forever, Mr McKenzie said '[e]very chance - for the life of the buildings at least' (MC ts 23).
The relevant statutory provisions
8 The relevant provisions of s 4 of the Act are as follows:
4. Prohibition against unregistered builders carrying on business
(1) Subject to this section, a person who is not registered under this Act shall not -
(A)(a) construct either for himself or any other person, any building for the purpose of the immediate sale thereof;
(aa) construct for himself any building other than a dwelling house or a building comprising 2 dwellings on ground level, each being complete and self-contained, whether or not the building is so designed as to give an external appearance of a single dwelling;
(b) enter into any contract or engagement to construct any building, or build any building for another in pursuance of any contract or engagement;
(c) be entitled to recover in any court any fee or charge under any such contract or engagement;
- (d) hold himself out as trading as a registered builder, or, as the case may be, a journeyman builder, unless -
(i) the total fee or charge payable in respect of the carrying out of the same does not exceed $6 000 or such other amount as may be prescribed by regulations made under section 24; or
(ii) under subsection (2) he is a person exempted from the necessity of obtaining registration;
(B) …
- (1aa) …
(1a) …
(1b) In subsections (1) and (1a) -
construct includes add to, alter, improve, renovate and repair.
(2) …
(3) The provisions of this section apply notwithstanding that a number of distinct contracts or engagements to perform work or render services are entered into in connection with the same building by the same person, where -
(i) the moneys payable in respect of the performance of the contracts or engagements exceed $6 000 or such other amount as may be prescribed by regulations made under section 24, in the aggregate but some or all of such contracts or engagements taken severally do not exceed that sum; or
(ii) in any case where the Board is satisfied that they are substantially in respect of the one undertaking or that they were entered into with a view to evading the provisions of this Act.
[B]uilding 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;
- In the context, 'permanent' bears its ordinary meaning of 'intended to last indefinitely': Macquarie Dictionary (3rd ed).
(Page 6)
10 The definition of 'construct', referred to above, is plainly not intended to be exclusive of the ordinary meaning of the word but rather to extend that meaning. That is evident both from the terms of that definition and the fact that it was first inserted only in 1979. In Robinson v Local Board for the District of Barton-Eccles, Winton & Monton (1883) 8 App Cas 798, 801, Lord Selborne LC observed in relation to interpretation clauses which use the word 'includes':
An interpretation clause of this kind is not meant to prevent the word from receiving its ordinary, popular, and natural sense whenever that would be properly applicable; but to enable the word as used in the Act, when there is nothing in the context or subject-matter to the contrary, to be applied to some things to which it would not ordinarily be applicable.
11 In the Macquarie Dictionary, 'construct' is defined to mean, relevantly, 'to form by putting together parts; build; frame; devise'. In the Shorter Oxford Dictionary (4th ed) it is defined to mean, relevantly, 'make by fitting parts together; build; erect'.
12 Regulation 18 of the Builders' Registration Regulations1940 (WA) provides that, for the purpose of s 4(1)(A)(d)(i), the total fee or charge payable in respect of the construction of a building is $20,000. By that regulation, for the purpose of s 4(3)(i) the aggregate sum payable for the performance of the contracts or engagements in respect of the construction of a building is prescribed as the same amount, $20,000.
The charge
13 The offence with which the appellant was charged was that, contrary to s 4(1)(A)(b) of the Act:
[O]n or about 15 October 2007 and not being a registered builder, [it] entered into an engagement to construct a building for another … the total value of which exceeded $20,000.
14 Although particulars of the charge were not sought or ordered, a statement of the alleged material facts was provided by the respondent and appears to have been regarded by the parties as particulars. It was as follows:
1. The accused was not a registered builder at all material times.
2. On 15 October 2007, the accused entered into an engagement with Kintail Investments Pty Ltd for the siting, stumping and connection of 67 transportable accommodation units in consideration for the fixed sum of $2,699,777.
(Page 7)
- 3. The above constitutes an engagement to construct a building, contrary to s 4(1)(A)(b) of the Builders' Registration Act 1939.
15 The appellant pleaded not guilty to the charge.
The decision of the magistrate
16 The charge was heard in the Magistrates Court before her Honour Magistrate Hogan on 15 October 2009. In a reserved decision delivered on 9 December 2009, her Honour dismissed the charge. She concluded as follows:
The accused has been charged as a person not registered under the Act with entering into an engagement to construct a building. It is alleged that the accused entered into an engagement to add to and alter numerous pre-fabricated buildings by: preparing a site for installation of the buildings; installing the buildings onto the prepared site which included footings; by connecting the buildings to various utilities; and by providing and connecting verandas to the building. The court is satisfied that the provision of footings is caught by the definition of 'construct'. However the court is not satisfied beyond reasonable doubt that the engagement can be categorised as one to construct a building given that the construction of the footings themselves constituted only a component part of the engagement.
The evidence relating to the connection of services and verandas was insufficient to establish beyond reasonable doubt that the engagement included the provision of same such that that provision would fall within the definition of 'construct'.
The prosecution has failed to discharge the burden of proof, beyond reasonable doubt in relation to whether the buildings in question are buildings of a permanent nature [38]-[40].
17 The respondent appealed against the magistrate's decision and the appellant filed a notice of contention alleging that the prosecution notice was void for duplicity. The allegation of duplicity had not been raised before the magistrate.
The decision of the primary judge
18 On the appeal, the primary judge identified the following matters as being in issue:
1. Was the charge that the appellant entered into an engagement to construct 'a building' void for duplicity, or did it allege an offence not known to the Act because the engagement entered into was to construct 67 transportable accommodation units?
(Page 8)
- 2. Was a transportable accommodation unit a 'building' as defined -
(a) in the form in which it was made, or
(b) only when it was structurally altered?
3. Was a transportable accommodation unit a 'building of a permanent nature'?
4. Was the contract into which Kintail and Keller entered an 'engagement to construct' a building in that it involved adding to or altering 67 transportable accommodation units?
5. Did the requirement that the total fee or charge payable in respect of the construction should be over $20,000 apply to each unit, or to the whole contract or engagement made in respect of 67 units?
19 On the first issue, the appellant contended that the charge, as amplified by the particulars, was not that the appellant had entered into an engagement to construct a building for a fee exceeding $20,000 but rather that it had entered into an engagement to construct 67 buildings for the total sum of $2,699,777. The offence under s 4(1)(A)(b) of the Act was entering into an engagement to construct a building for a fee exceeding $20,000. The allegation that the appellant had entered into an engagement to construct a number of buildings, some or all of which may be for a fee of less than $20,000, did not disclose an offence known to the law. Alternatively, it was submitted that the charge was duplicitous in alleging 67 offences.
20 The primary judge rejected both arguments. His Honour noted that the appellant was charged with having 'entered into an engagement to construct a building', not with constructing a building. There was only one engagement, entered into on or about 15 October 2007, albeit it concerned 67 buildings. He found there was no duplicity and the offence charged was within the Act.
21 Turning to the second issue, his Honour considered that the word 'building' was used in two senses in the Act: first, to refer to something which is constructed or built which is 'used or intended to be used for residential … purposes', and, secondly, to refer to the process of erection or structural alteration of something which would become a building in the former sense. He found that each transportable accommodation unit was a 'building'. They were used or intended to be used for residential purposes and the process of erection or structural alteration of them would
(Page 9)
- make them different buildings (although not necessarily of a different character) [31].
22 On the question of whether a unit was a building of a permanent nature, the primary judge held that a building was of a permanent nature if it was so made that it might last indefinitely, provided that its construction or erection was not for a temporary or limited purpose. On the evidence, his Honour concluded that, subject to ordinary maintenance and wear and tear, the units might last indefinitely as residential units even though they might be moved from place to place [37]. Moreover, once affixed to the footings the units were buildings of a permanent nature because they might have been there indefinitely. There was no evidence that they were located on site for a temporary or limited purpose.
23 The primary judge then turned to the question of whether the appellant had 'entered into a contract or engagement to construct [a] building'. His Honour said it was clear that the units (in their transportable state) were constructed as residential accommodation by Blue Ridge. However, his Honour noted that the extended definition given to 'construct' in s 4 of the Act included to 'add to, alter, improve, renovate and repair'. The question, therefore, was whether the engagement the appellant entered into was one to 'construct' each unit in the sense of to 'add to' or 'alter' it. (His Honour had earlier concluded that 'alter' referred to a structural alteration.) The primary judge concluded as follows:
In my opinion, the work of constructing the concrete footings, embedding the steel plates on them and welding the accommodation units to those footings so as to affix the unit indefinitely to the land (unless the nature of the building was altered by breaking the weld) was work which involved adding to each unit and making structural alterations to it so that the character of each unit was changed from being a transportable accommodation unit to one which was affixed permanently to the land. The engagement was for the construction of each unit within the meaning of the Act and the extended definition of the word 'construct' [43].
24 His Honour went on to say that the fact the engagement included other work which did not fall within the Act was irrelevant to the question in issue. He found that the magistrate erred in concluding that the contract or engagement was not one for the construction of a building because the overall contract work was not of that nature.
25 Finally, the primary judge found that the $20,000 threshold applied to the contract sum attributable to the construction work - $198,200 - and not to the value of the work done on each individual unit. The offence
(Page 10)
- was not the building of buildings but entering into a contract or engagement to carry out construction work for an amount in excess of $20,000. In this case the appellant had entered into a contract or engagement to construct a building - in that it entered into a contract or engagement to construct 67 buildings - for an amount in excess of $20,000.
26 The primary judge concluded that all the elements of the offence had been made out. He set aside the decision of the magistrate and entered judgment of conviction. The question of penalty was to be dealt with later.
Grounds of appeal
27 In substance, the appellant contended that the primary judge erred in law in that his Honour:
1. should have found that the appellant had not been charged with an offence known under the Act, or alternatively had been subject to a charge which was bad for duplicity, in that the respondent's case at trial was that the appellant constructed 67 buildings, not 'a' building as pleaded in the Prosecution Notice, for a fee of $2,699,777, of which fee the learned judge found the sum of just under $3,000 represented the cost of the alleged construction work to be carried out by the appellant in respect of each such building;
2. erred in law in finding that the contract or engagement the subject of the charge was a 'contract or engagement for the construction of a building' in that:
a. the contract or engagement was one for civil works, not for the construction of a building;
b. the extended definition of the word 'construct' in s 4(1b) of the Act applies to structural works undertaken on an existing building, not the type of civil works agreed to be undertaken by the appellant.
3. erred in finding that the $20,000 threshold constituting the 'total fee or charge payable' applied to the total contract price, as distinct from the construction work for which that fee was payable in respect of each 'building', as defined in the Act;
4. erred in finding that there was sufficient evidence to establish beyond reasonable doubt that a transportable accommodation unit
- was a 'building of a permanent nature' within the meaning of the word 'building' under the Act, in that:
- a. a transportable accommodation unit is, by its nature, constructed to be easily removed and transported to various other sites; and
b. evidence of the fact that the transportable accommodation units were subject to a '10 year lease', together with evidence that the weld applied to secure the transportable units to the footings in order to be safe in the event of a cyclone could easily be ground away, gave rise to a reasonable doubt as to whether the transportable accommodation units were constructed for the purpose of being fixed permanently to the site, or were otherwise by their nature permanent.
The disposition of the appeal
28 The appeal turns upon the proper construction of the Act. The general principles of statutory construction are well-established and for present purposes can be shortly stated. Ordinarily, the words of a statutory provision are to be construed according to their literal or grammatical meaning, but that principle is not to be applied inflexibly. The context of the words, the consequences of a literal or grammatical construction, the purpose of the statute, or the canons of construction may require the words of a legislative provision to be read in a way that does not correspond with the literal or grammatical meaning: see Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 [78]. A construction that would promote the purpose or object underlying the written law is to be preferred to a construction that would not promote that purpose or object: Interpretation Act 1984 (WA), s 18.
29 Before turning to the specific issues raised by the grounds of appeal, it is appropriate to deal with an issue as to the proper construction of the Act which arose in the course of argument on the present appeal.
30 It will be noted that in s 4(1)(A), immediately following par (d), there are two exemptions contained in subparagraphs (i) and (ii), namely where the fee or charge payable is less than the prescribed amount, and where the person is exempted from registration. As s 4(1)(A) is set out, it would appear at first sight that those exemptions apply only to s 4(1)(A)(d). But it is, we think, evident that that cannot have been
(Page 12)
- intended. In the first place, that form of layout appears to have come into the Act, not by reason of any amendment, but simply in the 1993 reprint of the Act. In the Act as it was originally enacted, it is clear from the layout that the two exceptions applied to each of s 4(1)(A)(a) - (d). Secondly, if the exemptions were to be read as applying only to s 4(1)(A)(d) it would have the result that in relation to the prohibitions in s 4(1)(A)(a) - (c) there would be no such exemptions. When s 4 is read as a whole, it is, we think, plain that that cannot have been the intention.
31 In our view, notwithstanding the layout, it was clearly intended that the two exemptions are to apply to each of s 4(1)(A)(a) - (c). It is unnecessary for present purposes to consider how they apply to s 4(1)(A)(d) - which prohibits an unregistered person holding himself out as a registered builder or journeyman builder.
Ground 1
32 It was submitted by the appellant that the offence under s 4(1)(A)(b) of the Act was entering into an engagement to construct a (that is, one) building for a fee exceeding $20,000. The nature of the offence indicated that it had to be established on the occurrence of a single event or in respect of a single subject-matter. In this case, the charge, as amplified by the particulars, was not that the appellant had entered into an engagement to construct a building for a fee exceeding $20,000, but rather that it had entered into an engagement to construct 67 buildings for a total contract sum of $2,699,777. The allegation that the appellant had entered into an engagement to construct a number of buildings, some or all of which may be for a fee of less than $20,000 was unknown to the law or alternatively, duplicitous.
33 In our view, there is no substance in this ground. We do not consider the offence in s 4(1)(A)(b) of the Act is limited to a contract or engagement to construct a single building. The word 'building' includes 'buildings': see Interpretation Act s 10(c). Whilst the offence charged is, in its terms, in the singular ('a building'), it is apparent from the charge as amplified by the particulars (constituted by the statement of the alleged material facts) that the appellant was in fact charged with having entered into an engagement to construct a building contrary to the Act, in that it had entered into an engagement to construct 67 buildings in respect of which the total fee exceeded $20,000.
34 As the primary judge observed, there was only one engagement alleged, an engagement on or about 15 October 2007. If the necessary elements of the charge were made out by the respondent, the appellant
(Page 13)
- could be convicted of only one offence in relation to that engagement. No difficulty is created by the fact that the engagement alleged was for the construction of 67 buildings. There was no duplicity, nor is the alleged offence unknown to the law.
35 We would dismiss this ground of appeal.
Ground 2
36 The appellant advanced two contentions in support of this ground. First, it submitted that the appellant's engagement was to be characterised having regard to the entirety of the work the appellant was to undertake. When so considered, the engagement was one for the performance of civil engineering works, not building work. The component relied upon by the respondent as constituting building work was for an amount of less than $200,000, in a total contract sum of almost $2.7 million.
37 In our opinion, that contention must be rejected. The evident purpose of the Act is to protect the community by ensuring that any substantial building work (determined by a necessarily somewhat arbitrary monetary value) is carried out only by persons who have established, by obtaining registration under the Act, that they have both the technical competence (s 10(1) - (2)) and the financial capacity (s 10(2a) - (2b), s 13(1)(ba)) to carry it out. See Builders' Registration Board of Western Australia v Roroka Pty Ltd (Unreported, WASC, Library No 8776, 25 March 1991).
38 Consistent with that purpose, where a person has been engaged to carry out both building work and work of a different nature, the relevant question is not the characterisation of the contract or engagement as a whole but simply whether the fee or charge attributable to the building work is in excess of the prescribed threshold. It is irrelevant what proportion the building work makes up of the total contract work. If it were otherwise, it would mean that anyone, whether registered under the Act or not, could undertake building work of any magnitude so long as the building work formed a relatively minor part of the overall contract work. That would be inconsistent with the plain purpose of the Act and could never have been intended.
39 Secondly, the appellant submitted that the primary judge erred in finding that the pouring of the footings, the installation of the steel plates, and the welding of the plates to the units fell within the extended definition of 'construct' in s 4(1b) of the Act.
(Page 14)
40 The appellant submitted that the extended definition was plainly intended to apply to the renovation, by way of structural changes, of an existing building, not to the construction of a new building. The appellant argued that it could never have been intended to apply to anyone who added to or altered a building in the course of its original erection or installation. If it did, every subcontractor involved in structural work in the construction of a building (such as a bricklayer or roofing contractor) whose fee or charge exceeded the threshold amount would have to be a registered builder, notwithstanding that the overall building work was supervised by a registered builder.
41 The appellant further argued that, contrary to the finding of the primary judge, the preparation of the concrete footings and steel plates and the welding of the plates to the units did not make structural alterations or additions to a building. The footings and steel plates were not alterations to the units because they were completed before the attachment of the units to them. The weld which was applied did not 'alter' or 'add to' the units within the meaning of s 4(1b). It did not involve any structural alteration or addition; it was simply to stop the units blowing away. The appellant submitted that while the primary judge found that welding the steel plates to the units altered the 'character' of the units by making them permanent rather than transportable, s 4(1b) is not concerned with alterations to the character of units but only with alterations or additions of a structural nature.
42 The respondent put its case on two bases. It submitted that the work which the appellant agreed to carry out was to construct a building within the meaning of s 4(1)(A)(b) either because it was the construction of a new building or because it was the structural alteration of an existing building. In relation to the former, the respondent argued that since the introduction of the extended definition of 'construct' in s 4(1b), the Act is to be construed so that not only must a person who carries out additions, alterations, improvements, renovations or repairs of, or to, a complete building be a registered builder if their fee exceeds the prescribed amount, but any person (not being a registered builder) who is working on the construction of any portion of a building not yet complete commits an offence if the fee for their work exceeds the prescribed amount.
43 That interpretation would produce an unfortunate result in relation to today's building industry. Most houses in Perth are constructed for a landowner under a contract or engagement with a registered builder to build the complete house. The registered builder then employs subcontractors to construct portions of the work to create the building.
(Page 15)
- Many subcontractors will be paid a fee exceeding the prescribed amount. The respondent's argument means that a plumber carrying out the work of digging a trench, laying a sewer line and then connecting the sewer to a house (a building) which is under construction, would 'improve' the building and therefore at the moment that plumber enters into the subcontract with the builder to join up the plumbing line to the partially constructed building, he would be guilty of the offence of 'entering into a contract to construct a building' if he were not a registered builder and the fee payable was more than the prescribed amount.
44 That, in our view, is not a construction which accords with the intention of the Act. On the contrary, it is evident that it was never intended that any subcontractor involved in the construction of a new building had to be registered under the Act if the amount of their fee or charge exceeded the prescribed amount. In the first place, it appears from the Minister's second reading speech that the addition to the Act of the extended definition of 'construct' in s 4(1b) was simply intended to overcome what was seen as a loophole in the Act (Western Australia, Parliamentary Debates, Legislative Assembly, 15 November 1979, 4819). The loophole was that people entering into contracts to renovate an existing building had been held not to enter into a contract to construct a building, so that a person carrying out major renovations of an existing building for a fee in excess of the prescribed amount did not have to be a registered builder. As a result, s 4(1b) was added so that the word 'construct' was defined to include 'add to, alter, improve, renovate and repair'.
45 Secondly, the history of s 4 and the proper construction of s 4(1)(A)(b) requires 'building' in its ordinary meaning to be read as referring to a complete building. It is evident that the purpose of stipulating that only a registered builder may enter into a contract or engagement to construct a building for a fee above the prescribed amount is to require that work of that magnitude is managed and supervised by a person who is equipped to ensure that it is carried out in a proficient and workmanlike manner. To that end, s 10AA provides that where any building work is carried out by a natural person who is a registered builder, that person must personally manage and supervise the building work or ensure that it is managed and supervised. Similarly, s 10B and s 10C impose obligations on partnerships and companies respectively to ensure that any building work they carry out is managed and supervised by a partner (or in the case of a company, a director) or employee who is registered under the Act. Section 10CA provides that the management and supervision must be sufficient to ensure that the building work is
(Page 16)
- carried out in a proficient and workmanlike manner. Plainly, the obligation on a registered builder in each of s 10AA, s 10B and s 10C to manage and supervise the building work includes the supervision and management of work carried out by others.
46 What, therefore, is required is that where the construction of a building (including the addition to, or the alteration, improvement, renovation or repair of an existing building) exceeds an amount of $20,000, the whole of the construction work must be managed and supervised by a registered builder. It was never intended that any contractor involved in any part of the work whose charge exceeded $20,000 would be required to be a registered builder.
47 It follows that a person, such as the plumber in the above example, does not commit an offence by entering into a contract to carry out subcontracting work for a fee of more than the prescribed amount. The contract or engagement of the plumber is not a contract or engagement to construct a building. A contract to contribute to or construct part only of a building is not a contract to construct a 'building'. Nor is it a contract or engagement to add to, alter, improve or renovate a building because the building is only in the process of being constructed. As a matter of ordinary meaning, a building cannot be added to, altered, improved or renovated unless a building first exists.
48 In addition, the Act is concerned with work of a structural nature, not other types of work. That appears from the definition of 'building', when used as an abstract noun (s 2). Moreover, where parliament has considered it necessary to regulate those who undertake other types of work it has done so by means of specific legislation, such as in respect of painters under the Painters Registration Act 1961 (WA), in respect of electricians under the Electricity (Licensing) Regulations 1991 (WA) (made under the Electricity Act 1945 (WA)), and in respect of plumbers under the Water Services Licensing (Plumbers Licensing and Plumbing Standards) Regulations 2000 (WA) (made under the Water Services Licensing Act 1995 (WA)).
49 In the course of argument on the appeal a question was raised as to whether a contractor who entered into a contract or engagement to perform part only of the work involved in an addition, alteration, improvement, renovation or repair of an existing building was required to be a registered builder under the Act if the contractor's fee or charge exceeded $20,000. It is unnecessary to determine this point for the purposes of the appeal but we think it would follow from what we have
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- said that in such circumstances it would not be necessary for the contractor to be a registered builder.
50 We turn then to the question of whether what the appellant was engaged to do constituted the construction of a building within the meaning of s 4(1)(A)(b).
51 In our opinion, whether a building is a 'building of a permanent nature' within the meaning of the Act involves two elements; first, that it is made of material that is intended to last indefinitely, and secondly, that it is affixed to the ground in a manner which is intended to last indefinitely. However, whether something is intended to last indefinitely does not depend upon the subjective intention of the maker or owner but is to be determined objectively by reference to the nature of the thing itself. As the primary judge pointed out, a tent would clearly not satisfy the first element [35]. Nor indeed would it satisfy the second element. But equally the durability of the material of which something used for a residence (or for one of the other prescribed purposes) is made is not of itself sufficient. Thus, ordinarily a caravan, although it is made of material that is intended to last indefinitely and is used for residential purposes, will not be a 'building' within the meaning of the Act because it is of a portable nature. The second element is not satisfied, at least while it is portable. Similarly, the units, although made of material that is intended to last indefinitely, will not fall within the Act while they remain in a transportable state.
52 In this case, Blue Ridge constructed the units for Kintail and it was Kintail which had arranged for the construction of the complete building (or buildings). The contract entered into by the appellant and Kintail to prepare the site, to carry out infrastructure works, prepare footings for the units and to install the units by attaching them to the footings, did not involve the construction of a 'building'. It was a contract or engagement to construct part of a building or to render engineering services relating to the construction of a building. Nor was it a contract to add to, alter, improve, renovate, or repair a 'building'. There was no 'building' in existence until the units had been secured to the footings.
53 Ground 2 should be upheld. On that basis, we would allow the appeal. The order of Murray J should be set aside and in lieu there should be an order that the appeal from the decision in the Magistrates Court should be dismissed.
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54 It is therefore unnecessary to determine the other grounds of appeal but as they were fully argued it is appropriate to say something about them.
Ground 3
55 The appellant submitted that the primary judge erred in finding that a contract or engagement to construct a number of buildings for a total amount in excess of $20,000 constituted an offence under s 4(1)(A)(b). It argued that the Act was concerned with the value of the building work in respect of individual buildings, not with the total value of building work in respect of a number of buildings, and it would be contrary to the purpose of the Act to construe it otherwise. Accordingly, in order to make out the charge the respondent had to prove that in respect of at least one individual unit the fee or charge exceeded $20,000.
56 We would reject that submission. The construction found by the primary judge followed from a plain reading of the Act. We do not accept that that construction is contrary to the purpose of the Act. As we have already noted, the purpose of the Act is to ensure, first, that a person who enters into a contract or engagement to carry out building work above the prescribed value has the technical competence to carry out the work, and secondly, that the material resources of a person who enters into any such contract or engagement are such that consumers of his or her services are protected to the greatest extent possible against financial collapse. It is not to the point that the contract or engagement relates to a number of different buildings and that when broken down into the amount attributable to each building, each such amount is less than the threshold. It is consistent with, in particular, the second purpose we have mentioned that such a contract or engagement to carry out building work in excess of the threshold amount may only be undertaken by a person registered under the Act.
57 We would dismiss this ground of appeal.
Ground 4
58 In relation to this ground, the appellant contended that, by their nature, the units were easily removed and transported to other sites and, accordingly, it was submitted, they were not of 'buildings of a permanent nature'.
59 We consider that this ground fails, as a matter of fact, on its premise. As we have said, whether a building is of a 'permanent nature' is to be
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- determined by the objective nature of the building. It does not depend on whether or not the subjective intention of the owner is that it is to last indefinitely. As counsel for the respondent pointed out by way of example in the course of argument, if the subjective intention was decisive the construction of a brick and tile house would fall outside the Act if the owner intended to demolish it within a few years to construct a more substantial residence.
60 In the present case, on the evidence once the units were affixed to the footings they could not easily be removed and transported to other sites. The manner in which they were affixed to the ground was not of a temporary nature. As the units were constructed by Blue Ridge, a steel beam was incorporated in the perimeter of the base of the unit. The units were to be secured to the footings by welding the steel beam to the steel plate which was embedded in the concrete of the footing. The plate then effectively became part of the unit. The weld connecting the beam to the steel plate had to be sufficiently strong to withstand cyclonic conditions. To remove a unit it would be necessary to 'grind off' the weld.
61 The fact that the units were capable of being removed from the site by grinding off the welded connection does not mean that they would not, while in situ, be buildings of a permanent nature within the meaning of the Act. A building which is physically affixed to the land does not, in our opinion, fall outside the definition of a 'building' in s 2 of the Act simply because it may become moveable if its otherwise permanent connection to the land is severed. Thus, it is by no means unknown for wooden houses which have been erected on stumps or other foundations to be later detached from the stumps or other foundations which affix them to the ground and transported, intact, to another location. It could not sensibly be suggested that such a house does not constitute a building within the meaning of the Act prior to the point at which it is detached from its stumps or foundations.
62 This ground of appeal must fail. We would refuse leave to appeal on this ground.
Conclusion
63 We would:
1. allow the appeal;
2. set aside the order of Murray J, and;
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- 3. order that the appeal from the decision of the Magistrates Court be dismissed.
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