Kruse v Sunland Homes Pty Ltd - [2023] QCAT 331

QUEENSLAND CIVIL AND

ADMINISTRATIVE TRIBUNAL

CITATION:

Kruse v Sunland Homes Pty Ltd [2023] QCAT 331

PARTIES:

SANDY D KRUSE

(applicant)

v

SUNLAND HOMES PTY LTD

(respondent)

APPLICATION NO/S:

BDL213-22

MATTER TYPE:

Building matters

DELIVERED ON:

25 August 2023

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Senior Member Brown

ORDERS:

The application for miscellaneous matters filed 15 December 2022 is refused.

CATCHWORDS:

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – ENDING PROCEEDINGS EARLY – SUMMARY DISPOSAL – SUMMARY JUDGMENT FOR DEFENDANT OR RESPONDENT: STAY OR DISMISSAL OF PROCEEDINGS – where the respondent brought an application to dismiss the proceeding under s 47 of the QCAT Act – where the respondent argues the applicant has no cause of action in negligence against the respondent because the applicant is not vulnerable – whether the applicant is vulnerable – where the applicant purchased the townhouse sometime after it had been constructed by the respondent – where there is water ingress from the window installed by the respondent – whether a pre-purchase inspection report would have identified the alleged defective building work

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – ENDING PROCEEDINGS EARLY – SUMMARY DISPOSAL – SUMMARY JUDGMENT FOR DEFENDANT OR RESPONDENT: STAY OR DISMISSAL OF PROCEEDINGS – where the respondent brought an application to dismiss the proceeding under s 47 of the QCAT Act – where the respondent argues the applicant failed to comply with section 77(2) of the QBCC Act – whether the applicant had complied with section 77(2) of the QBCC Act before commencing the proceeding – where the respondent is a subsidiary of the party named in the original QBCC complaint – whether the steps taken by the parties were sufficient to satisfy the QBCC that participation in the dispute resolution process had been achieved

Queensland Building and Construction Commission Act 1991 (Qld), s 77(2)

Queensland Civil and Administrative Act 2011 (Qld), s 47

Brookfield Multiplex Ltd v Owners Corp Strata Plan 61288 (2014) 254 CLR 185

Bryan v Maloney (1995) 182 CLR 609
Chan v Acres [2015] NSWSC 1885
Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515

Simons & Ors v Dowd Lawyers Pty Ltd [2020] QCAT 348

APPEARANCES & REPRESENTATION:

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld)

REASONS FOR DECISION

The applicant, Ms Kruse, lives in a townhouse built by the respondent, Sunland Homes Pty Ltd. The applicant says that the building work undertaken by the respondent is defective. Specifically, the applicant says that a window was not properly installed, the consequence being that the window permits water penetration into the dwelling.
The respondent has applied to dismiss the proceeding. The application for dismissal falls to be determined.
The power of the Tribunal to dismiss a proceeding
By s 47 of the Queensland Civil and Administrative Act 2011 (Qld) (‘QCAT Act'), the Tribunal may dismiss a proceeding, or part of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2023] QCAT 331
Decision Date

CaseChat Overview and Summary

In Kruse v Sunland Homes Pty Ltd, the applicant sought relief from the Civil and Administrative Tribunal (CAT) against Sunland Homes Pty Ltd, a building contractor, on the basis that a window installed by the contractor was defective. The dispute centred on whether the contractor owed a duty of care to the applicant to avoid causing economic loss due to latent defects in the building. The case was heard and determined by McDougall J in the CAT.

The primary legal issue before the tribunal was whether Sunland Homes Pty Ltd had a duty of care towards the applicant to avoid causing economic loss due to latent defects in the building. This issue hinged on the concept of 'vulnerability', as articulated by the High Court in Woolcock Street Investments Pty Ltd v CDG Pty Ltd and Brookfield Multiplex Ltd v Owners Corp Strata Plan 61288. The court had to determine whether the applicant was vulnerable and unable to protect herself from the risk of harm caused by the contractor's alleged lack of reasonable care.

The tribunal found that the applicant was not vulnerable as she was aware of the issue with the window before purchasing the property and had the opportunity to protect herself from loss by having a pre-purchase building inspection. The tribunal also noted that the respondent did not provide any evidence from the Queensland Building and Construction Commission in support of its contention. Consequently, the application for miscellaneous matters was dismissed.

The tribunal ordered that the application for miscellaneous matters be refused.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

Subsequently, in Woolcock Street Investments Pty Ltd v CDG Pty Ltd[4] and Brookfield Multiplex Ltd v Owners Corp Strata Plan 61288[5] the High Court determined that proximity is not the test in determining the liability of a building contractor to a building owner. The guiding consideration is ‘vulnerability’ and whether a building owner is capable of protecting themselves from the consequences of a building contractor’s lack of reasonable care. Gageler J stated in Brookfield Multiplex:[t]he continuing authority of Bryan ... should be confined to a category of case in which the building is a dwelling house and in which the subsequent owner can be shown by evidence to fall within a class of persons incapable of protecting themselves from the consequences of the builder’s want of reasonable care. Outside that category of case, it should now be acknowledged that a builder has no duty in tort to exercise reasonable care, in the execution of building work, to avoid a subsequent owner incurring the cost of repairing latent defects in the building.[6] (underlining added)[4](2004) 216 CLR 515. [5](2014) 254 CLR 185.[6]Ibid at para [185]. Crennan, Bell and Keane JJ explained the distinctions between the situation in Brookfield Multiplex and that in Bryan v Maloney in the following terms:The material distinctions between the present case and Bryan v Maloney lie, first, in the detailed prescriptions of the D&C contract between the appellant and the developer, in contrast to the simple obligation in Bryan v Maloney between the builder and the original owner to exercise reasonable skill and diligence in the construction of the dwelling; and, secondly, in the express promises in cll 32.6 and 32.7 of the sales contracts, in contrast to the situation in Bryan v Maloney, where there was no promise as to quality given to Mrs Maloney when she acquired the dwelling.[7][7]Ibid at para [136]. The test for vulnerability was explained in the following terms by McDougall J in Chan v Acres:[8]At the risk of over-simplifying what is a complex question, the authorities make it clear that the question, whether a defendant owes a plaintiff a duty of care to prevent the plaintiffs’ suffering economic loss, depends in the first instance on whether the plaintiff is relevantly “vulnerable” to the defendant’s acts and omissions. In this context, “vulnerable” does not mean only that the plaintiff is susceptible to harm as a result of the defendant’s acts or omissions. There is the added requirement that the plaintiff must be unable (perhaps, “reasonably” unable) to take steps to protect itself from that risk of harm.[9][8][2015] NSWSC 1885.[9]Ibid at [150]. The question of vulnerability is one of fact and requires an examination of, among other things, the nature of the events giving rise to the building work.[10] The respondent asserts that the applicant was not vulnerable on the basis that the issue with the window was known to the applicant before she purchased the property and that she had the opportunity to protect herself from loss occasioned by defective building work by having a pre-purchase building inspection undertaken. [10]The Owners – Strata Plan No 51077 v Meriton Apartments Pty Ltd [2014] NSWSC 1761.

Decision

Reasons for decision

I would also note that the respondent has placed before the Tribunal no evidence in the form of a letter or otherwise from the QBCC in support of its contention.Conclusion The application for miscellaneous matters is refused.

Ratio Decidendi

Legal Principle Established

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