KOS and DND BUILDING CO PTY LTD - [2020] WASAT 95

JURISDICTION     :   STATE ADMINISTRATIVE TRIBUNAL
ACT: BUILDING SERVICES (COMPLAINT RESOLUTION AND ADMINISTRATION) ACT 2011 (WA)
CITATION:   KOS and DND BUILDING CO PTY LTD [2020] WASAT 95
MEMBER:   MS C BARTON, MEMBER
MR R AFFLECK, SENIOR SESSIONAL MEMBER

HEARD:   17 MARCH 2020, 29 APRIL 2020 AND 26 MAY 2020
DELIVERED          :   18 AUGUST 2020
FILE NO/S:   CC 926 of 2019
BETWEEN:   JUSUF KOS
First Applicant
FADILA KOS
Second Applicant
MUSTAFA KOS
Third Applicant
SAFETA KOS
Fourth Applicant
AND
DND BUILDING CO PTY LTD
Respondent

Catchwords:

Building service complaint - Whether unsatisfactory building work - Monetary order sought by owner - Whether irretrievable breakdown in relationship - Loss of confidence in builder - Form of building remedy order - Specificity of order to remedy

Legislation:

Building Act 2011 (WA), s 3
Building Services (Complaint Resolution and Administration) Act 2011 (WA), s 3, s 5(1), s 11(1)(d), s 36(1), s 36(1)(a), s 36(1)(b), s 36(2), s 38(1)(a), s 38(1)(b), s 51
Building Services (Complaint Resolution and Administration) Regulations 2011 (WA), reg 5
State Administrative Tribunal Act 2004 (WA), s 60(2)

Result:

Application successful

Category: B

Representation:

Counsel:

First Applicant	:	W Vogt
Second Applicant	:	W Vogt
Third Applicant	:	W Vogt
Fourth Applicant	:	W Vogt
Respondent	:	P Monaco

Solicitors:

First Applicant	:	Vogt Graham Lawyers
Second Applicant	:	Vogt Graham Lawyers
Third Applicant	:	Vogt Graham Lawyers
Fourth Applicant	:	Vogt Graham Lawyers
Respondent	:	GV Lawyers

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

Gemmill v Sanders [2018] WASC 179
Hippydayze Pty Ltd and Mener Group Pty Ltd [2019] WASAT 92
Jennings and Howitt [2019] WASAT 133
Lewis and Waco Pty Ltd [2016] WASAT 127
Nelson v Mardesic (1998) 22 SR (WA) 42
The Owners of One Brighton Strata Plan 51948 and Pindan Pty Ltd [No 2] [2020] WASAT 3

REASONS FOR DECISION OF THE TRIBUNAL:

Introduction

A dispute arose between the parties concerning the construction of a residential building at 33A David Street, Yokine (property). The registered proprietors of the property are Jusuf, Fadila, Mustafa and Safeta Kos (applicants). The respondent is DND Building Co Pty Ltd (builder).
The applicants lodged a building service complaint with the Building Commissioner on 23 November 2018 alleging faulty or unsatisfactory building work comprising 13 items (complaint). The Building Commissioner referred the complaint to the Tribunal under s 11(1)(d) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA) (Act).
Of the 13 complaint items, the builder has conceded items 1, 4, 5, 6, 9, 10 and 12. The builder acknowledges that remedial works are required in respect of items 3, 8, and 11 and is prepared to undertake those works. The applicants are seeking a monetary order in respect of the complaint items because they assert, amongst other reasons, that there has been an irretrievable breakdown in the relationship with the builder. The remaining items in dispute, and for which the applicants are seeking a monetary order, relate to:
•item 2 - external texture coat at left side of the balcony;
•item 7 - defects in construction of timber roof frame; and
•item 13 - inadequate structural integrity of footings and concrete slab work in the meals area.
The proceeding was heard on 17 March 2020 with the parties and witnesses attending in person. The hearing continued by telephone on 29 April and 26 May 2020 due to the restrictions imposed by the Western Australian Government response to COVID-19. After hearing the parties' closing submissions on 26 May 2020, the Tribunal reserved its decision.

The issues for determination

The issues for determination by the Tribunal are as follows:
(1)was the building work carried out at the property, the subject of the complaint items, faulty or unsatisfactory?; and
(2)if the answer to (1) is in the affirmative, what is the appropriate form of the building remedy order (if any) in respect of the complaint items?

The statutory framework

Section 5(1) of the Act relevantly provides that a person may make a complaint to the Building Commissioner about a regulated building service not being carried out in a proper and proficient manner or being faulty or unsatisfactory. A complaint made under s 5(1) of the Act is defined as a 'building service complaint': s 3 of the Act.
A 'regulated building service' is defined in s 3 of the Act to be a building service carried out by a registered building service provider. Relevantly, a 'building service' includes 'building work' as defined in s 3 of the Building Act 2011 (WA) (Building Act) being the construction, erection, assembly or placement of a building or an incidental structure (being a structure attached to or incidental to a building).
Regulation 5 of the Building Services (Complaint Resolution and Administration) Regulations 2011 (WA) (Regulations), imposes the limitation that only a person whose interests are being or have been adversely affected by the carrying out of a regulated building service may make a building service complaint.
Where a building service complaint is referred to the Tribunal by the Building Commissioner under s 11(1)(d) of the Act, s 38(1)(a) of the Act enables the Tribunal to make a building remedy order where it is satisfied that the regulated building service has not been carried out in a proper and proficient manner or is faulty or unsatisfactory. The Tribunal may otherwise decline to make a building remedy order under s 38(1)(b) of the Act.
Under s 36(1) of the Act, a building remedy order made by the Tribunal may require a person who carried out a regulated building service to do one or more of the following:
(a)remedy the building service as specified in the order;
(b)pay to an aggrieved person such costs of remedying the building service as the Tribunal considers reasonable and specifies in the order; and
(c)pay an aggrieved person a sum of money specified in the order to compensate the aggrieved person for the failure to carry out the building service in a proper and proficient manner or for faulty or unsatisfactory building work.
A building remedy order may require that the order is complied with within a time frame specified in the order: s 36(2) of the Act.

The conduct of the hearing and expert evidence

Mr Richard Machell, a chartered building professional with Prescient Consulting, prepared a written report dated 23 July 2018 in relation to the complaint items, and a supplementary report dated 31 March 2020. Mr Machell was called by the applicants to give evidence at the hearing on 17 March 2020 and 29 April 2020. The Tribunal found Mr Machell to be an honest and reliable witness. He gave evidence in a considered and pragmatic manner.
The builder called Mr Andrew Booth, a civil engineer with ABBC Building Inspectors, who was of assistance to the Tribunal in its determination. Mr Booth prepared a report dated 12 July 2018 and a further report dated 16 January 2019 and also gave evidence at the hearing on 17 March 2020 and 29 April 2020 in relation to all of the complaint items. Two supplementary reports prepared by Mr Booth dated 23 April 2020 were provided to the Tribunal by the builder, including a report on the integrity of the balcony waterproof membrane in respect of item 2.
In relation to the construction of the roof (item 7), the applicants relied on the expert evidence of Mr Machell. The builder relied on the expert evidence of Mr Gary Marocchi, an engineer with Marocchi Engineering Group, and the structural engineering consultant for the construction of the residential building at the property. The builder also called Mr Booth to provide expert evidence on this item at the hearing.
Because Mr Marocchi was not called as an independent witness (Mr Marocchi was engaged as the structural engineer for the build), the Tribunal prefers the evidence of Mr Machell and Mr Booth to that provided by Mr Marocchi. Where there are differences in opinion between Mr Machell and Mr Booth, the Tribunal prefers the evidence of Mr Machell because he provided practical and reasoned responses to questions posed of him.
The structural integrity of footings and concrete slab work in the meals area (item 13) was addressed by expert witnesses Mr Santiago Abueva from Optimum Engineering Consultants, and Mr Attilio Marra, from Engineering Design Consultancy, both civil engineers. Mr Abueva and Mr Marra were engaged by the applicants in these proceedings and gave evidence at the hearing on 17 March 2020. In addition, the applicants relied on the evidence of Mr Simon Jewell, a structural and facade engineer from Atelier JV. The Tribunal accepts the evidence of Mr Abueva, Mr Marra and Mr Jewell concerning the integrity of footings and concrete slab work in the meals area. The builder relied on the evidence of Mr Marocchi and Mr Booth, as well as the evidence of Mr Philip Italiano, a builder and director of iBuild, who gave evidence at the hearing on 29 April 2020 about the scope of work required to remedy item 13.
In relation to the timber flooring in the meals area (item 13), the applicants called Mr Tomas Stopa, from Thomas Floor Installation and Sanding, to give evidence at the hearing on 29 April 2020. Mr Stopa carried out the original timber flooring work at the property. He has been working as a carpenter for 12 years and obtained his qualification in Europe and the United States of America. Having regard to Mr Stopa's expertise and specialisation in the laying of timber floors, the Tribunal prefers the evidence of Mr Stopa to that of Mr Booth and Mr Italiano in respect of the scope of work to remedy this item.
The Tribunal relied on written reports prepared by the expert witnesses which were tendered in evidence as part of the hearing book comprising one volume (Exhibit 1). A further report of Mr Abueva was tendered at the hearing on 17 March 2020 (Exhibit 2). A supplementary hearing book dated 15 April 2020 (Exhibit 5) was prepared by the applicants following orders made by the Tribunal at a directions hearing on 5 March 2020. A number of quotations from building contractors (who were called to give evidence at the hearing on 29 April 2020) are included in Exhibit 5. In response, and for the purposes of the continuation of the hearing on 29 April 2020, the builder filed with the Tribunal a bundle of documents (Exhibit 6).
The Tribunal also had the benefit of a witness statement from the fourth applicant, Ms Safeta Kos, dated 15 April 2020 and a witness statement from Mr Denis Murselovic, a director of the builder, dated 24 April 2020. Both Ms Kos and Mr Murselovic gave evidence at the hearing on 29 April 2020.

Summary of evidence in respect of the complaint items

Item 2 external texture coat at left side of balcony wall

Mr Machell stated that the excessive amount of efflorescence that is visible on the external face of the left side of the balcony wall is the result of the failure of the waterproofing membrane (ts 11, 29 April 2020). He concluded that salts were leaching from that position from the balcony. The applicants tendered a photograph of the balcony showing the efflorescence (Exhibit 3). A horizontal line of efflorescence can be seen at the southwest corner of the building at approximately slab level. The line extends less than 600 millimetres from the corner on both south and west elevations. A series of horizontal lines of efflorescence is also visible above the slab level up the west face of the pillar at various levels.
There is a horizontal crack, 1 to 2 millimetres at its widest point at the building corner approximately 10 courses above slab level on the west and south faces of the southwest pier (Exhibit 6, page 28).
To remedy the cause of the efflorescence, Mr Machell stated that it is necessary to remove tiles on the balcony to ensure that the waterproof membrane is intact. It is Mr Machell's opinion that a control joint may be required to address the cracking before a texture coat is applied to both panels of the external walls (ts 12, 29 April 2020; Exhibit 1, page 199).
In contrast, Mr Booth provided evidence to the Tribunal that the waterproofing of the balcony corner is not damaged and, therefore, the scope of work referred to in Mr Machell's report to repair the waterproof membrane is not required (Exhibit 6, page 30). It is Mr Booth's opinion that the horizontal stress cracks on the face of the texture coat in the pier above the efflorescence is caused by the creep of the cantilevered structure over time (between the slab and the brickwork). He said that the discolouration observed by Mr Machell may be patches rather than lines because of the absorption of moisture through the cracks into the masonry. Mr Booth does not consider the cracking to be faulty or poor workmanship and, therefore, the rectification of the cracking is considered to be part of the owner's normal maintenance.

Item 3 cracking in walls at the staircase

The builder accepts that the work in relation to item 3 is unsatisfactory. The question for the Tribunal is the scope of the remedial work required.
Mr Machell recommends that a suitable movement joint be installed at both the left and right sides of the stairwell to accommodate movement that may reasonably be expected to occur at the junction of the upper and lower level walls with the suspended concrete slab, making good all affected and adjacent surfaces as required. Mr Machell also recommends that all areas of 'drummy' plaster that exceed 200 millimetres by 200 millimetres in an area of 4m² of wall be removed and replaced, making good all affected and adjacent surfaces (Exhibit 1, page 204).
Mr Booth agreed with Mr Machell's proposal that a movement joint would solve the problem. He also agreed that the joint should be installed on both the left and the right sides of the stairwell. However, Mr Booth did not consider it necessary to remove the 'drummy' plaster.

Item 7 defects in construction of timber roof frame

In relation to the construction of the timber roof frame, Mr Machell stated in his report that:
•the rafters are not connected to underpurlins with a method that complies with AS1684.2 (Exhibit 1, page 210);
•the fan struts installed below underpurlins are not braced in all locations and where braces are installed they are not fixed with 2 x T17 screws, contrary to AS 1684.2 (Exhibit 1, page 211);
•the struts installed below underpurlins and which are at other than 90 degrees are not chocked at the bottom in all instances, contrary to AS 1684.2 (Exhibit 1, page 212);
•the timber strutting beams connected to the steel strutting beams are not adequately connected or laterally restrained. Typically such a connection is by a 10 millimetre plate with 2 x M16 bolts (Exhibit 1, page 214);
•the hanging beams connected to strutting / counter beams are not adequately connected, contrary to AS 1684.2 (Exhibit 1, page 214); and
•the collar ties are installed below underpurlins and not above underpurlins contrary to AS 1684.2 and are not fixed with bolts (Exhibit 1, page 215)
Mr Marra's findings in his report dated 20 October 2019, which relate to the structural integrity of the roof, are consistent with those of Mr Machell. Mr Marra inspected the lower roof (above the single storey area) but did not have access to the upper roof. In Mr Marra's opinion, the roof (as inspected) has not been constructed in accordance with AS 1684.2 and requires remedial work (Exhibit 1, page 259).
In relation to the fourth dot point above, Mr Booth observed that the engineer's drawings are silent on the method of attachment to a steel beam but the drawings do list a specification for bolted connections in general (Exhibit 1, page 412). Mr Booth generally agreed with Mr Machell's observations about the repairs required to the roof but disagreed with many of his recommendations about the scope of the repair work. Mr Booth observed that Mr Machell's report does not mention which roof was inspected but only includes photos of the lower roof.

Item 8 failure to install provision for overflow to eaves gutters

In Mr Machell's opinion, a failure to install a provision for overflow of high fronted eaves gutters, where in the event of a blockage or overflow water could flow into the roof of the building, represents faulty work. Mr Machell recommends that a provision for overflow of high fronted gutters be installed, consistent with the National Construction Code 2014 (NCC) at 3.5.2.4, making good all affected and adjacent surfaces (Exhibit 1, page 216).
Mr Booth gave evidence that there are a number of solutions to remedy the gutters, including inverted 'pops' between downpipes to accommodate the design of the gutter. He recommends that a roofing plumber be engaged to explore alternative options.

Item 11 failure to install adequate spreader pipes to upper level downpipes

Mr Machell considers that the spreader pipes fixed to the bottom of the downpipes that discharge stormwater from the upper level roof onto the lower level roof do not comply with Standards Australia HB 39:2015 Installation code for metal roof and wall cladding (Exhibit 1, page 218). Mr Machell recommends that all spreader downpipes be installed consistent with HB 39:2015, making good all affected and adjacent surfaces.
Mr Booth gave evidence that the item could be remedied by hobs on the bottom of the spreader to widen (or spread) the flow of water onto the roof.

Item 13 inadequate structural integrity of footings and concrete slab work in meals area

This complaint item relates to a section of the concrete slab beneath the meals area. There was evidence before the Tribunal from Mr Marocchi and Mr Marra that it was poured at a separate stage from the initial pour of the concrete slab (Exhibit 1, page 258).
On 3 August 2018, under the supervision of Mr Abueva, United Scanning Services Pty Ltd conducted Ground Penetrating Radar concrete scanning of the meals area floor to determine the slab thickness, slab thickenings / footings, slab reinforcements, and dowels for the cold joints. Mr Abueva interpreted the results and found that there was a cold joint with no dowels and a 200 millimetre unreinforced strip between the original and extension slab. Mr Abueva stated that dowels are required at the transverse joints of a concrete slab to provide a connection between the slabs and to provide load transfer. Also, the extension slab had no slab thickenings along the edges to support the exterior wall (Exhibit 1, page 236).
Mr Abueva gave evidence that he found irregularities in the concrete scanning results which he considered were caused by insufficient site preparation. He did not carry out soil compaction tests but he said that the results appeared to show loose soil. Mr Abueva supported the use of chemical microfine injection to raise the slab in the meals area. Mr Jewell reviewed the concrete scanning results and provided evidence that there was no strip footing, and that the slab had been poured without dowels.
Mr Marra prepared a written report on the structural integrity of the meals area slab. The findings made by Mr Marra in his report dated 29 October 2018 include the following (Exhibit 1, page 257-258):
•column C1 does not have a pad footing as required by the design engineer;
•no connecting dowels were installed between the two slab pours, and no slab edge thickening was formed. Therefore, there is no capacity for load transfer between the separately poured slabs; and
•the measurements of maximum deviation from the horizontal level ranged from 6 millimetres to 16 millimetres for the 1200 millimetres length. The values of the deviation are easily visible and are not acceptable in the building industry.

In contrast, Mr Marocchi's report provides that dowels were not required to the added-on section of ground slab because there is a strip footing that acts as a support for the ground slab on both sides of the joint (Exhibit 1, page 350).
The applicants contend that the entire ground level timber floor should be replaced, which is an area of approximately 110m². However, the builder contends that the replacement of 7m² of flooring is sufficient to remedy this item. The applicants rely on the evidence of Mr Stopa, the original flooring subcontractor, in support of their position. Mr Stopa gave the following evidence:
•the existing floorboards have discoloured over time and there is no ability for him or his suppliers, Hurford Wholesale (who supply the HM Walk product which was used), to supply matching floor boards;
•there is no ability to sand and refinish the top floorboard due to the thinness of the laminate (~3 mm) over the ply substrate;
•even if a colour match could be found, flooring plank widths vary from batch to batch so there would remain the possibility of mismatch of widths which could result in some gaps between boards, an unacceptable presentation in engineered floors; and
•the itemised quote for the work is $36,860 (inclusive of GST), a rate of $335/m².
The builder relies on the evidence of Mr Booth. Mr Booth stated that removing a larger area of floorboards than 7m²could compromise the window and door systems. He expressed concern that there could be a reduction in the upstand on the door frame on the eastern perimeter of the meals area once the floor is levelled and the boards relaid. Mr Booth recommends the following remedial work be performed:
•remove locally the affected flooring and skirting and a margin around those boards for working room;
•top the floor to level it with a topping compound such as Ardit Floor Leveller in accordance with the manufacturer's recommendations; and
•after suitable drying time, re-lay the flooring and skirtings.
The builder also relies on the evidence of Mr Italiano in relation to the scope of work to remedy item 13 and a quotation for that work supplied to Mr Italiano by Westwood Flooring. Westwood Flooring had in turn sourced the quote from Nerim Catic, an Accredited Level 5 Master Craftsman, who was not called to give evidence at the hearing. The quotation for the replacement of 7m² of flooring is $3,905 or $558 per m² (Exhibit 1, pages 457 and 463).

Purported breakdown in relationship

The applicants contend that there has been an irretrievable breakdown in the relationship between the applicants and the builder. It is for this reason, amongst others, that the applicants seek an order, under s 36(1)(b) of the Act, for the builder to pay the applicants a reasonable sum of money representing the 'correct and preferred' scope of work to remedy the complaint items.
The applicants' position in support of a monetary order may be summarised as follows:
1)The relationship between the parties is highly acrimonious given their long history of litigation, specifically:
a)the Magistrates Court proceedings commenced by Jusuf and Fadila Kos trading as J & F Kos against the builder on 19 July 2018 for nonpayment of $66,000 in respect of the supply and installation of cabinetry works. The hearing took place over seven days and the Magistrate reserved her decision;
b)the adjudication proceedings which the builder commenced against the applicants on 17 October 2018 in respect of a payment claim for $97,570. The adjudicator issued his determination on 8 November 2018 dismissing the builder's application; and
c)the current proceedings.
2)Ms Kos sent an email to Mr Murselovic dated 3 July 2018 with photographs showing a disparity of the external texture coat of the front balcony together with a defect liability form in respect of a number of items that required rectification. Mr Murselovic responded by email dated 6 July 2018 and advised Ms Kos that she was 'out of time' because the defects liability period was 16 weeks from the date of completion which expired on 10 November 2016. He also advised Ms Kos that all maintenance issues had been addressed. In a later email on 6 July 2018, Mr Murselovic advised Ms Kos that Mr Booth would not attend the site to carry out an inspection because the defects liability period had expired.
3)The applicants provided the builder with a number of opportunities to rectify the complaint items, including a letter of demand from the applicants' lawyer dated 1 November 2018. Despite these opportunities, the builder either failed or refused to undertake the rectification work.
4)In relation to the flood testing of the balcony waterproofing by Mr Booth on 1 April 2020, Ms Kos advised her solicitor of the presence of water on the exterior of the balcony wall on 6 April 2020. Her credibility cannot be questioned as Ms Kos is a reliable and honest witness who has diligently prosecuted this matter since 3 July 2018.
5)There is a complete lack of trust in the builder which would require the applicants to watch every step the builder took to rectify the complaint items. This would not be workable for the applicants or the builder.
6)The applicants have no confidence that that the builder is competent to carry out the rectification work in a proper and proficient manner.
The builder's position in relation to its relationship with the applicants, and in support of an order to remedy, may be summarised as follows:
1)The builder should be permitted to carry out the remedial works as opposed to being subject to an order for costs. There has not been an irretrievable breakdown in the relationship between the parties as asserted by the applicants. The parties were business to business contractors and had dealt with each other in the cabinetry and building industry for a long period of time.
2)The parties have a long business relationship with a significant history of working on numerous projects together. The applicants have worked with the builder on eight previous builds, including the current project.
3)The builder is a reputable builder. This is the first time the builder has had a complaint in relation to workmanship issues. Mr Machell gave evidence that apart from three to four items the quality of the house is fine. The issues to be remedied are not complex.
4)There is significant disparity between the applicants' costs for the works and the quotation provided by iBuild in relation to the builder's costs for remediating the work.
5)If the builder returns to remedy the work, the builder will remain responsible if the work is not successful. If another contractor undertakes the work, the demarcation between responsibilities would become blurred. This is a relevant factor to be considered by the Tribunal, particularly in relation to item 13.
6)Ms Kos states at para 25 of her witness statement that the applicants have a level of distrust with the builder that they cannot overcome. She asserts that she would have to stand over the builder. However, she took several days to email her solicitor about the appearance of water on the external balcony wall and, therefore, her credibility should be seriously doubted.

The Tribunal's findings

There is no dispute between the parties that the construction of a residential building at the property is a regulated building service for the purposes of the Act and that the builder carried out the regulated building service. Under s 38(1)(a) of the Act, the Tribunal may make a building remedy order where it is satisfied that the regulated building service has not been carried out in a proper and proficient manner or is faulty or unsatisfactory.
The builder accepts that the building work referred to in complaint items 3, 8, and 11 is faulty or unsatisfactory. The parties' experts were in agreement that further work was required to remedy these items. Accordingly, based on the evidence of the experts, the Tribunal finds that, in respect of items 3, 8 and 11, the builder has carried out a regulated building service in a manner that is faulty or unsatisfactory for the purposes of s 38(1)(a) of the Act.
In relation to item 2, Mr Machell gave evidence that the excessive amount of efflorescence that is visible on the external face of the left side of the balcony wall is the result of the failure of the waterproofing membrane. Mr Booth acknowledged the existence of the efflorescence but, in his opinion, the horizontal lines seen on the face of the texture coat is caused by the creep of the cantilevered structure over time and is a maintenance issue for the owner. The Tribunal finds that the cracking and excessive amount of efflorescence that is visible on the external face of the left side of the balcony wall is due to poor workmanship. Accordingly, in relation to item 2, the Tribunal finds that the builder has carried out a regulated building service in a manner that is faulty or unsatisfactory for the purposes of s 38(1)(a) of the Act.
In relation to item 7, Mr Booth generally agreed with Mr Machell's observations that repairs were required to the timber roof frame. The Tribunal accepts the evidence of Mr Machell and Mr Booth and finds that remedial work is required to the fan struts to achieve compliance with AS 1684.2, to improve the connection of the timber strutting beams to the steel strutting beams and to address the other defects identified in the complaint. Accordingly, in relation to item 7, the Tribunal finds that the builder has carried out a regulated building service in a manner that is faulty or unsatisfactory for the purposes of s 38(1)(a) of the Act.
In relation to item 13, the parties' experts agreed that remedial work was required to the timber flooring in the meals area due to the subsidence of the concrete slab. However, the experts expressed different opinions as to the scope of the work required to remedy item 13. The Tribunal finds, based on the evidence of the experts, that the structural integrity of the footings and concrete slab in the meals areas is inadequate. Accordingly, in relation to item 13, the Tribunal finds that the builder has carried out a regulated building service in a manner that is faulty or unsatisfactory for the purposes of s 38(1)(a) of the Act.

The form of the building remedy order

The Tribunal may require a person who carried out a regulated building service that is faulty or unsatisfactory or has not been carried out in a proper and proficient manner to be the subject of a building remedy order. Section 36(1) of the Act confers discretion on the Tribunal as to the form of the building remedy order. The building remedy order may specify the work to be performed or require a sum of money to be paid to the aggrieved person to remedy the building service or as compensation for the work being faulty or unsatisfactory. It is not the case that any failure to carry out the building service in a proper and proficient manner must result in the grant of a building remedy order: see Lewis and Waco Pty Ltd [2016] WASAT 127 [at 9].
The applicants have expressed a strong preference for a monetary order under s 36(1)(b) of the Act because there has been an irretrievable breakdown in the relationship between the applicants and the builder. The applicants have no right to elect the remedy sought under s 36(1) of the Act but are entitled to express a preference. In Gemmill v Sanders [2018] WASC 179 at [133]-[135] (Gemmill), Smith AJ, as her Honour then was, observed:
It must be borne in mind that the statutory limits on the exercise of the discretion to make a building remedy order are only those set out in s 38. The repository of the power conferred to make an order (the Tribunal) must form an opinion that the regulated building service (that is the subject of the building service complaint) has not been carried out in a proper and proficient manner, or is faulty or unsatisfactory.
If the requisite opinion is formed, the Tribunal is required to make a building remedy order. It then has to exercise the discretion conferred in s 36(1) to make a particular order in the form of s 36(1)(a), (b) or (c). Thus, no 'right' or requirement on a party to a complaint to elect arises.
I do, however, agree with the point made in Nelson that the Tribunal has no power to compel an owner or require an owner or a person who has the right to control entry to a property to allow access to a site to enable an amount of work to be carried out in accordance with a building service work order. If there is evidence that such access was likely to be denied then that would be a relevant matter of fact that the Tribunal could take into account.
It follows that the Tribunal cannot fetter its discretion by simply adopting the applicants' preference for a monetary order. The applicants' preference, and reasons for seeking a monetary order, however, are relevant matters for the Tribunal to consider when determining the type of building remedy order to make: Gemmill at [147].
In Hippydayze Pty Ltd and Mener Group Pty Ltd [2019] WASAT 92 at [126], the Tribunal identified the following matters (which are not exhaustive) that may be relevant to the exercise of the Tribunal's discretion under s 36(1) of the Act, particularly when exercising its discretion to make a building remedy order in monetary terms:
[W]hether there has been an irretrievable breakdown in the relationship between the parties (Trengove and Celebration Nominees Pty Ltd [2012] WASAT 65 at [36]); whether an owner has justifiably lost confidence in the workmanship and skill of the respondent (Nelson v Mardesic (1998) 22 SR (WA) 42); whether the respondent has attempted to remedy the regulated building service previously unsuccessfully and whether the respondent has refused to perform remedial work when invited to do so.
It is common practice to give a builder respondent an opportunity to remedy its own defective work. This is because an order to remedy compensates the owner while minimising the hardship to the builder who can usually carry out the work at substantially less cost than the amount charged by a third party contractor: Nelson v Mardesic (1998) 22 SR (WA) 42 at 46. However, the nature and extent of the complaints may raise concerns about the proficiency and competency of the builder and support a finding by the Tribunal that a monetary order is more appropriate than ordering a builder to perform remedial work: Jennings and Howitt [2019] WASAT 133 at [31].
The applicants do not wish the builder to perform any further building work at the property. The applicants contend that there is an irretrievable breakdown in the relationship with the builder due to the history of litigation between them. The applicants further contend that they have a complete lack of trust in the builder and have no confidence that the builder could carry out the rectification work in a competent manner: witness statement of Ms Kos dated 15 April 2020 at paras 2530.
A history of litigation between an owner and respondent builder, and the irretrievable breakdown in their relationship, are relevant matters for the Tribunal to consider in exercising its discretion under s 36(1) of the Act. However, a finding by the Tribunal that the parties' relationship has broken down is not determinative. In most proceedings, a breakdown in the relationship is a natural consequence of a dispute arising between an owner and a builder. In the circumstances of this case, the Tribunal observes that there is the additional factor that, in early 2017, the builder chose no longer to use Jusuf and Fadila Kos as its cabinet makers after finding contractors with more competitive rates: witness statement of Mr Murselovic dated 24 April 2020 at paras 78).
On the basis of the evidence before it, the Tribunal finds that the parties' relationship has irretrievably broken down. The evidence of Ms Kos is that she does not want the builder to return to the property and would need to watch every step the builder took to rectify the complaint items. The applicants contend that this scrutiny of the builder's work would make any remedial order unworkable.
The Tribunal acknowledges that the applicants may have lost trust in the builder due to the breakdown in their relationship, but the Tribunal finds that the applicants' position that they have lost confidence in the builder's competence to undertake the remedial work is unjustified. The Tribunal accepts the evidence of Mr Murselovic at para 9 of his witness statement that this is the first time the builder has had a complaint in relation to workmanship issues in over 400 builds. The Tribunal finds that the property was nominated for a Housing Industry Association award in 2016 but did not win the award as stated by Mr Murselovic at para 10 of his witness statement (ts 46, 26 May 2020).
The nature and extent of complaint items that require rectification is limited (13 items) compared with many building disputes that come before the Tribunal. When Mr Machell was asked in crossexamination by the builder's counsel about his overall impression of the quality of the house, Mr Machell responded as follows (ts 23, 29 April 2020):
There don't appear to be any other defects other than those ones which have been identified. The overall appearance is fine; I don't have any issue with it.
Accordingly, the Tribunal rejects the applicants' assertion that the builder is not competent to carry out the rectification work because this finding is not supported on the evidence.
The applicants contend that they provided the builder with a number of opportunities to rectify the complaint items, including a letter of demand from the applicants' lawyer to the builder dated 1 November 2018. However, the Tribunal finds that the builder was (and remains) prepared to attend the property and rectify the complaint items. The Tribunal is satisfied of this fact notwithstanding that the builder originally advised the applicants that its claim was outside the defects liability period (and, on that basis, the builder's proposal for Mr Booth to inspect the defects was a mistake) (Exhibit 5, pages 99-100 and 106).
The Tribunal finds that the builder was (and remains) prepared to attend the property and rectify the complaint items based on the following evidence:
1)Prior to the lodgement of the applicants' complaint with the Building Commissioner, the builder responded to a Scott Schedule prepared by the applicants and agreed to attend the property to rectify a number of items and with other items asked that the builder's experts attend to provide advice to the builder regarding any remedial works required: witness statement of Mr Murselovic dated 14 April 2020 at para 11 and DM2; Exhibit 6, page 60.
2)In response to a draft order to remedy issued by the Building Commissioner in June 2019, the builder advised the Building Commissioner by email dated 14 June 2019 that it would like to action all required remedies as soon as possible (witness statement of Mr Murselovic dated 24 April 2020 at para 13 and DM4; Exhibit 6, page 72):
DND Building accept the revised Building Remedy Order and we would like to action all required remedies as soon as possible.
Mr Vogt indicated that the Complainant has suffered significant stress as a result of these issues. Therefore can we confirm access to 33A David St, Yokine so that we can start repairs immediately.
[T]his is my number one priority and my team are ready to resolve this. Please be assured I also have my tradesman on standby so that the Building Remedy Order will be enacted quickly (original emphasis).
3)Mr Murselovic's evidence that the builder has not been given the opportunity to attend the property to undertake the rectification work but is willing to attend and undertake the work (Exhibit 6, page 54).

The Tribunal considers there are a number of advantages to the applicants having the builder return to perform the work pursuant to an order under s 36(1)(a) of the Act. This includes the opportunity to 'convert' the order to a monetary order under s 51 of the Act if the work is not performed, or partly performed, or performed in a faulty or unsatisfactory manner. If the applicants were to engage a third party to rectify the builder's work, questions may arise as to who is responsible for any faulty remedial work, particularly if the underlying issues remain. Ensuring that liability remains clear in circumstances where subsequent remedial work is itself faulty or unsatisfactory is an advantage to the applicants. For this reason, a third party contractor may also be reluctant to perform remedial works that are the subject of a monetary order in respect of another builder's (underlying) work.
Accordingly, for the reasons set out above, the Tribunal finds that the builder ought to be given the opportunity to perform the remedial work in respect of the complaint items and will exercise its discretion to make a building remedy order under s 36(1)(a) of the Act. In light of this, it is unnecessary for the Tribunal to make any findings in respect of the evidence presented by the parties on the costs of remedying the complaint items.

Specificity of an order to remedy

The Tribunal finds that a building remedy order should be made under s 36(1)(a) of the Act to remedy the complaint items.
The decision of The Owners of One Brighton Strata Plan 51948 and Pindan Pty Ltd [No 2] [2020] WASAT 3 (Pindan) at [33]-[36] provides some useful observations about the specificity of orders under s 36(1)(a) of the Act having regard to the findings in Gemmill:
The respondent builder in Gemmill v Sanders argued that an order under s 36(1)(a) must 'state in detail how the remedy is to be carried out' (at [164]). Her Honour considered the meaning of the work 'specify' and then went on to say (at [169]):
… I do agree that in light of the Tribunal's clear and unambiguous findings made about the method that is to be implemented to make good the cornices and ceilings, to simply state in the order that Gemmill Homes is required to remedy 'the effect' of all cracking is not to specify how the regulated building service is to be remedied. Put another way, an order that simply requires Gemmill Homes to remedy the effect of the cracking is not to implement the findings made by the Tribunal as to how the defects in the work were to be remedied.
This passage may suggest that it is necessary for a building remedy order to specify precisely how the remedial work is to be carried out.
Her Honour's remarks must be considered in the context of the particular circumstances before her. It appears that there was evidence before the Tribunal from the owner's expert that the work should be done in a particular way, which included installing 'scrim'. That evidence was not entirely accepted. The Tribunal accepted evidence that there was little benefit in installing scrim. The orders did not clarify or identify which approach to the remedial work should be adopted.
There are risks associated with specifying the particular way in which a defective building service should be remedied. Owners of Strata Plan 52843 and Psaros Builders Pty Ltd [2013] WASAT 46 and Owners of Strata Plan 52843 and Psaros Builders Pty Ltd [2018] WASAT 113 demonstrate this risk. A method for remedying the building service was specified but it did not work because the specified method did not comply with the requirements of the Building Code of Australia and could not be carried out.
It follows that the Tribunal may specify the work to be done in an order made under s 36(1)(a) of the Act where there are clear and unambiguous findings by the Tribunal about the method or approach that should be implemented to remedy the defects.

Item 1 texture coat missing at base of sliding door reveals

The Tribunal accepts Mr Machell's recommendation that the entire width and height of the two reveals of the rear sliding door should be repaired so as to ensure that the texture coated surface is continuous to all corners of the reveals (ts 10, 29 April 2020). Mr Booth acknowledged in his supplementary report dated 22 April 2020 that the full height and width of the reveals should be coated if colour matching of the texture coat was a problem (Exhibit 6, page 7). Accordingly, the Tribunal will make a specific order that reflects Mr Machell's recommendation, making good all affected and adjacent surfaces as required.

Item 2 external texture coat at left side of balcony wall

The Tribunal accepts the evidence of Mr Machell and finds that removal of tiles on the balcony to investigate the waterproofing membrane is required. Accordingly, the Tribunal will make a specific order that the waterproofing membrane should be replaced if it is not intact in order to prevent water leaching from the balcony, making good all affected and adjacent surfaces as required. Both expert witnesses agreed that the cracking on the face of the texture coating should be addressed, however, Mr Booth considered it to be owner's maintenance. The Tribunal does not accept Mr Booth's position and finds that the builder should remedy the cause and effect of the excessive amount of efflorescence and the cracking on the face of the render.

Item 3 cracking in walls at the staircase

The parties' experts agreed that the installation of a suitable movement joint on both the left and right sides of the stairwell walls would accommodate movement that may be expected to occur at the junction of the upper and lower level walls with the suspended concrete slab. The Tribunal accepts the evidence of Mr Machell that the areas of 'drummy' plaster that exceed 200 millimetres by 200 millimetres in an area of 4m² of wall should be removed and replaced. Accordingly, the Tribunal will make a specific order to this effect, making good all affected and adjacent surfaces as required.

Item 4 white staining to texture coated garage pier

To address the white staining to the texture coated pier at the right side of the garage, the Tribunal accepts the evidence of Mr Machell that a suitable overflow device should be installed to the upper level gutter / rain head and that the gutter is adequately sealed at the junction of the rain head. Accordingly, the Tribunal will make a specific order to this effect, making good all affected and adjacent surfaces, as required.

Item 5 cracking of texture coat adjacent to 33 David Street

The parties' experts agreed that the scope of work to remedy this item requires the movement joint at the junction of 33A and 33 David Street to be reformed to extend through the full thickness of the render and texture coat and that adjacent cracking is to be repaired, making good all affected and adjacent surfaces. Accordingly, the Tribunal will make a specific order to this effect.

Item 6 water staining to ceiling in kitchen and living area

To address the water staining to the kitchen and living area ceiling, Mr Machell recommends that the ceilings at locations eight and nine should be repaired to achieve a uniform and consistent surface finish with the remainder of the ceilings, making good all affected and adjacent surfaces. The Tribunal accepts Mr Machell's evidence and will make a specific order to this effect.

Item 7 defects in construction of timber roof frame

The Tribunal accepts the evidence of Mr Machell and Mr Marra in relation to the rectification work required to the timber roof frame to improve the connection of the strutting beams, make the fan struts compliant with AS 1684.2 and to otherwise address the defects in the construction of the timber roof. Mr Booth generally agreed with Mr Machell's method of repair (Exhibit 6, page 12). Accordingly, the Tribunal will make a specific order that the roof framing identified in the complaint as defective is to be remedied so that it complies with AS 1684.2 making good all affected and adjacent surfaces as required.

Item 8 failure to install provision for overflow to eaves gutters

The parties' experts agreed that remedial work to the gutters is required but their opinions differed on the appropriate solution. The Tribunal preferred the evidence of Mr Machell who proposed that the solution be consistent with NCC 3.5.2.4. Accordingly, the Tribunal will make a specific order to this effect requiring the builder to install overflow provision to high fronted eaves gutters, making good all affected and adjacent surfaces as required.

Item 9 failure to install a downpipe of provision for overflow within 1.2 metres of a valley gutter

The Tribunal accepts the evidence of Mr Machell that the provision for exhaust of a gutter should be installed, consistent with the NCC 3.5.2.5. Accordingly, the Tribunal will make a specific order to this effect, making good all affected and adjacent surfaces as required.

Item 10 failure to install provision for overflow to box gutters

The Tribunal accepts the evidence of Mr Machell that provision for overflow to box gutters should be installed, consistent with AS 3500.3. Accordingly, the Tribunal will make a specific order to this effect, making good all affected and adjacent surfaces as required.

Item 11 failure to install adequate spreader pipes to upper level downpipes

The parties' experts agreed that remedial work to the upper level downpipes is required but their opinions differed on the appropriate solution. The Tribunal preferred the evidence of Mr Machell that all spreader downpipes be installed consistent with HB 39:2015, making good all affected and adjacent surfaces as required. Accordingly, the Tribunal will make a specific order to this effect.

Item 12 failure to connect kitchen exhaust to roof vent

The Tribunal accepts the evidence of Mr Machell that flexible duct should be connected to the existing section of duct and roof penetration, so that the range hood exhausts air, as designed. Accordingly, the Tribunal will make a specific order to this effect, making good all affected and adjacent surfaces as required.

Item 13 inadequate structural integrity of footings and concrete slab wok in meals area

The Tribunal accepts the evidence of Mr Marra and Mr Stopa and finds that the entire ground floor timber flooring should be removed and replaced (an area of ~110m²) because there is no ability to sand and refinish the floorboards due to the thinness of the laminate. The Tribunal finds that replacing 7m² of floorboards, as proposed by the builder, is not a satisfactory approach in light of the evidence of Mr Stopa that there would remain the possibility of a mismatch in plank widths which could result in gaps between the floorboards. Although Mr Machell considered that boards matching the deteriorated colours of the existing HM Walk product could be sourced, the Tribunal accepts the evidence of Mr Stopa that it would not be possible to supply matching boards.
The parties' experts agreed that the inadequate structural integrity of the footings and concrete slab work in the meals area should be addressed. Expert evidence was provided to the Tribunal about the employment of chemical microfine injection to stabilise the slab. However, the experts did not agree on the extent of cementitious grouting required.
The Tribunal finds that an investigation is necessary, following drilling through the floor of the meals area, to verify the extent and depth of cementitious grouting necessary to address the lack of dowels (or lack of footing under the slab joint), the lack of pad footing under the column and the lack of cover to the reinforcement in the slab. The Tribunal further finds that a suitable topping may be required to ensure the meals area is level with adjacent surfaces before the timber flooring is laid.
Accordingly, the Tribunal will make a specific order that the builder verify, by drilling through the floor of the meals areas, the extent and depth of cementitious grouting necessary to address the lack of dowels (or lack of footing under the slab joint), the lack of pad footing under the column, and the lack of cover to the reinforcement in the slab. The order will require the structural integrity of the footing and concrete slab work is to be remedied by the injection of cementitious grouting designed and supervised by an expert in the field, allowing for reasonable oversight by a structural engineer. The builder will be required to remove and replace the entire ground floor area of timber flooring (~100m²), making good all affected and adjacent surfaces as required. The builder is to ensure that the concrete slab in the meals area is level with adjacent surfaces before the timber flooring is laid.
For the above reasons, the Tribunal makes the following orders.

Orders

The Tribunal orders:
1.By 5.00 pm on 30 November 2020, pursuant to s 36(1)(a) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA), the respondent is to remedy the following items:
(a)the items it has agreed to remedy, being complaint items 1, 4, 5, 6, 9, 10 and 12; and
(b)the items that the Tribunal has identified as unsatisfactory, being complaint items 2, 3, 7, 8, 11 and 13.

2.To remedy the items referred to in order 1(a), the respondent is required to:
(a)in respect of item 1, repair the entire width and height of the two reveals of the rear sliding door so as to ensure that the texture coated surface is continuous to all corners of the reveals, making good all affected and adjacent surfaces, as required;
(b)in respect of item 4, install a suitable overflow device to the upper level gutter / rain head, and ensure that the gutter is adequately sealed at the junction of the rain head, making good all affected and adjacent surfaces as required;
(c)in respect of item 5, reform the movement joint at the junction of 33A and 33 David Street to extend through the full thickness of the render and texture coat and repair the adjacent cracking, making good all affected and adjacent surfaces as required;
(d)in respect of item 6, repair the ceilings at locations eight and nine to achieve a uniform and consistent surface finish with the remainder of the ceilings, making good all affected and adjacent surfaces as required;
(e)in respect of item 9, install provision for exhaust of a gutter, consistent with the NCC at 3.5.2.5, making good all affected and adjacent surfaces;
(f)in respect of item 10, install provision for overflow of box gutters at the front of the building, consistent with the AS 3500.3, making good all affected and adjacent surfaces; and
(g)in respect of item 12, connect flexible duct to the existing section of duct and roof penetration, so that the range hood extracts air, as designed, making good all affected and adjacent surfaces as required.

3.To remedy the items referred to in order 1(b), the respondent is required to:
(a)in respect of item 2:
(i)remove tiles on the balcony to investigate the integrity of the waterproofing membrane and, if it is not intact, replace the membrane to prevent water leaching from the balcony, making good all affected and adjacent surfaces as required; and
(ii)remedy the excessive efflorescence and cracking on the external face of the render, making good all affected and adjacent surfaces as required;

(b)in respect of item 3, install a suitable movement joint at both the left and right sides of the stairwell walls, removing and replacing all areas of drummy plaster that exceed millimetres by 200 millimetres in an area of 4m² of wall, making good all affected and adjacent surfaces as required;
(c)in respect of item 7, remedy the roof framing identified in the complaint as defective so that it complies with AS 1684.2, making good all affected and adjacent surfaces as required;
(d)in respect of item 8, install overflow provision to high fronted eaves gutters, consistent with NCC 3.5.2.4, making good all affected and adjacent surfaces;
(e)in respect of item 11, install spreader pipes to the upper level downpipes consistent with Australian Standard HB 39:2015, making good all affected and adjacent surfaces as required; and
(f)in respect of item 13:
(i)verify, by drilling through the floor of the meals areas, the extent and depth of cementitious grouting necessary to address the lack of dowels (or lack of footing under the slab joint), the lack of pad footing under the column, and the lack of cover to the reinforcement in the slab;
(ii)underpin the concrete slab and footings with cementitious grout, designed and supervised by an expert in the work of cementitious grouting, allowing for reasonable oversight by a structural engineer;
(iii)remove the timber flooring and add suitable topping to make the floor in the meals area level with adjacent surfaces;
(iv)if, and only if, the door frame sill upstand is found, by measurement and calculation, to be so reduced as to be defective, then the entire framing is to be removed and replaced so as to provide the necessary frame height relative to the finished floor; and
(v)remove and replace the entire ground floor area of timber flooring (~100m²) on completion of the other remedial works, making good all affected and adjacent surfaces as required.

4.The respondent is to carry out the remedial work the subject of this order in a proper and proficient manner and make good any damage caused by the carrying out of the remedial work.
5.The applicants have liberty to apply within 21 days from the date of this order to file with the Tribunal and give to the respondent an application for costs, including written submissions and any supporting documentation.
6.If the applicants elect to make an application for their costs, the respondent has 14 days from the date of the application to file with the Tribunal, and give to the applicants, written submissions and any supporting documentation in reply.
7.Subject to any further order of the Tribunal, an application for costs will be determined entirely on the documents pursuant to s 60(2) of the State Administrative Tribunal Act 2004 (WA).

I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.
MS C BARTON, MEMBER
18 AUGUST 2020