Luke Sweeney t/as Luke Sweeney Constructions v Sarah Magnay
[2011] QCAT 648
•25 February 2011
CITATION: Sweeney v Magnay [2011] QCAT 648
PARTIES: Luke Sweeney t/as Luke Sweeney Constructions v Ms Sarah Magnay
APPLICATION NUMBER: BD488-06
MATTER TYPE: Building matters
HEARING DATE: 25, 26, 27, 28 August 2009, 19, 20, 21, 22, 23 October 2009 and 3, 4 December 2009
HEARD AT: Brisbane
DECISION OF: Mr Paul Favell, Member
DELIVERED ON: 25 February 2011
DELIVERED AT: Brisbane
ORDERS MADE: The Tribunal orders that the Applicant pay the Respondent the sum of $126,869.86 by 4pm on 28 March 2011.
CATCHWORDS: Domestic Building Contract – minor works contract – renovation – incorrect level of slab – scope of works – defects – variation
Domestic Building Contracts Act 2000, ss 17A, 26, 29(2)(a), 72(2), 79, 82, 83, 84(4), 90
Notley, Bl v QBSA and Harvey [2005] QCCTB 100
Gary Norwood Homes Pty Ltd v QBSA (unreported, Bne DC, 20/6/97)
Collyer v QBSA [1998] QBT 71
Ross v Rangel [2004] QCCTB 98 (28 May 2004)
Rukat v Rukat [1975] 1 All ER 343
O’Brien (FG) UD v Elliott [1965] NSWR 1437
LIDA Build Pty Ltd v Miller (No 2) [2010] QCAT 431
Black, G. D Toowoomba Resort Pty Ltd [2007] QCCTB 122 (3 September 2007)APPEARANCES and REPRESENTATION (if any):
APPLICANT: R G Poiner of Counsel for the Applicant RESPONDENT: S B Whitten of Counsel for the Respondent, instructed by Mills Oakley REASONS FOR DECISION
Introduction
[1]The Applicant, Luke Sweeney t/as Luke Sweeney Constructions, and the Respondent, Sarah Magnay, executed a contract on 20 September 2005 concerning work at 12 Reid Street, Windsor to demolish the lower level of the house and then re-build it completely with new rooms and a set of internal stairs for $79,000.00.
[2]A second contract executed on 23 October 2005 was for work to demolish the carport attached to the existing house and then build a new carport in a different location for $31,000.00.
[3]Works on the first contract proceeded until December 2005. The Applicant contends that as at 23 December 2005 the contract was practically at completion save for minor works that could not be completed before the Respondent completed the proposed retaining wall. Accordingly he claimed the last payment. The Respondent refused to pay and the Applicant then discontinued with the works. The second contract was never commenced.
Factual Background and Claims
[4]The Applicant is a licensed builder. The Respondent has no particular expertise in construction and her husband, Graham Magnay, has limited expertise in construction having worked as a sub-contract painter.
[5]The Applicant met with the Respondent and her husband in or about May 2005. The Applicant was taken through a “walk through” of the house and was provided with the architectural plans.
[6]The Applicant provided the Respondent with quote number 341 dated 27 July 2005 for the proposed floor extension. The Applicant provided a separate quote for the carport, number 342, dated 27 July 2005.
[7]The parties executed two separate contracts for the lower level house works and carport works on 20 September and 23 October 2005 respectively.
[8]The Applicant contends that as at 23 December 2005 he had completed as much work on the first contract as was possible and was therefore entitled to the final payment which the Respondent wrongfully refused to pay.
[9]The Applicant has been paid the first four progress claims without any evidence of complaint or deduction. Progress Claim No 5 is in dispute.
[10]The fifth stage included three components: ‘External cladding’, ‘Electrical – Rough-in’ and ‘Plumbing – Rough-in’. There has been no issue as to the Plumbing Rough-in. The External cladding was considered by the Applicant to be complete on 23 December 2005 however the Respondent claims this to be defective. The Electrical Rough-in was also considered by the Applicant to be complete as at 23 December 2005 and the Respondent’s husband acknowledged in his statement that the Electrical Rough-in works had been completed.
[11]The Applicant presented the Respondent with the final claim on 23 December 2005. According to the first contract this was due to be paid on 31 December 2005.
[12]On 28 December 2005 the Respondent informed the Applicant that they were not paying the final claim as works were not complete to an acceptable standard. The Respondent’s husband further clarified that it was because the house had not yet been brought to lock up stage and listed the specifics as to why the house was not yet at lock up stage.
[13]The Applicant contends that the Respondent could only possibly have issues with the External cladding as there was no issue taken to the Plumbing – Rough-in or Electrical Rough-in under stage five and the first four stages had already been paid without dispute.
[14]The Applicant disputes that the Respondent was able to withhold the final payment as the Respondent never complained of incomplete work but rather that the work was not completed to an acceptable standard. Accordingly the Applicant submits he is entitled to the final payment under clause 11.7 of the first contract.
[15]The Applicant argues that clause 11.8 of the first contract prohibits the owner from deducting from a progress claim because of defects or omissions. He argues that the Respondent’s husband had given evidence that the Applicant appeared willing to rectify any problems identified and the Respondent should therefore be prohibited from withholding money because of defects.
[16]The Applicant contends that the Respondent repudiated the contract on 23 December 2005 by refusing to pay the final progress claim and the Applicant was therefore able to legally terminate the contract and discontinue work.
Applicant’s Claim
[17]The Applicant claims the money outstanding from Progress Claim No 5 being $15,800.00 less the value of the work they could not complete due to the Respondent’s failure to complete the retaining wall ($1,600.00). The Applicant therefore claims $14,200.00 from the Respondent.
[18]The Applicant also claims the unpaid extra electrical work ($4,225.00) and the Applicant’s loss of profit from the second contract ($8,045.00).
[19]Interest on the outstanding money is also claimed at a rate of 15% being $19,826.20 from the period 31.12.05 to 31.12.09.
[20]The Applicant allows for a deduction of $1,934.84 to rectify outstanding defects to the lower level at the time of the termination and $924 to rectify items on the upper level. The total of the Applicant’s claim is $43,437.36.
Respondent’s Response and Counterclaim
[21]In response to the Applicant’s claim the Respondent says it is not indebted to the Applicant.
[22]The Respondent contends that she is justified in not paying the Applicant’s claim because:
a. the Applicant did not finish the works;
b. the Applicant did not undertake any of the works required under the second contract; and
c. the Applicant’s work contained defects that require rectification that far exceed the amount of the Applicant’s claim.
[23]The Respondent claims that the contract was replete with ambiguity and that the ambiguity should be resolved in favour of the Respondent applying the contra proferentum rule for the following reasons:
a. the Applicant was responsible for, and prepared the contract himself;
b. sections 72(2)(f) and 29(2)(a) of the Domestic Building Contracts Act 2000 (“DBCA”) require the Applicant to ensure the specifications and a detailed description of the work were included in the contract;
c. section 26 of the DBCA requires the Applicant to ensure that the contract is put into written form.
[24]The Respondent claims that by virtue of s 17A of the DBCA the two contracts should be considered as a single contract for which the contract price is the sum of the two.
[25]The Respondent claims the contract consists of:
a. the written Residential Building Contract and the Minor Works Contract dated 20 September 2005 and 23 October 2005 respectively;
b. the Master Builders Residential Building Contract General Conditions;
c. the oral instructions given by the Respondent’s husband to the Applicant in or about late May 2005; and
d. the plans numbered 03.148-01A to 03.148-06A dated 7 September 2005.
[26]The Respondent claims that the evidence of the Applicant should be cast into considerable doubt because it is contradictory, vague and at times, false. The Respondent also claims that where the Applicant’s evidence is not supported by objective documentary evidence, it should be viewed with caution.
[27]The Respondent claims that the Applicant submitted claim number 5 even though he had admitted that works were incomplete and in the absence of any instructions not to complete the work.
[28]Clause 10.1(d) of the Master Builder General Conditions provides that where the works consist of renovating or extending a home to a stage suitable for occupation, the builder warrants that the works will be suitable for occupation when completed. The Respondent claims that the works were not at a stage suitable for occupation when the Applicant ceased work and therefore he was then in breach of contract.
[29]The Respondent claims that the Applicant had not completed stage five and accordingly payment of progress claim number five was not warranted. It is claimed the Applicant was in breach of contract because the Applicant sought a claim despite acknowledging not having completed the work.
[30]In regard to the second contract, the Respondent claims the Applicant breached that contract because he never commenced work on it.
[31]The Applicant provided the Respondent with a Notice of Intention to Terminate on 10 January 2006 in response to the Respondent not paying claim number 5 which the Respondent claims compounds the breaches.
[32]Clause 22.3 prohibits the builder from terminating if the builder is in substantial breach of the contract. The Respondent claims that the Applicant was in substantial breach for the above reasons.
[33]The Applicant then sent a Notice of Suspension of Works on 23 January 2006 which the Respondent claims was a further breach of contract.
[34]On 14 April 2006 the Respondent issued a notice of intention to terminate. The Respondent claims that on 21 April 2006 it was made clear in a letter from the Applicant that he would not unconditionally remedy the breaches and the Respondent thereby sent notices of termination on 25 and 26 April 2006. The Respondent argues that the contract was then terminated without prejudice to any of their other rights.
[35]The Respondent claims that the Applicant had no justification for issuing progress claim number 5 and the Respondent was therefore not in substantial breach in not paying the claim. The Respondent further claims that she terminated on the basis of the Applicant’s repudiation of the contract, constituted by the notice of intention to terminate, the unjustified suspension of works, the substantial defects and failure to rectify, and the claim for an incomplete stage.
[36]In reply to the Applicant’s claim that the Respondent cannot complain of defects in previous stages already paid for, the Respondent claims that payment of an earlier stage does not estop the Respondent from raising it as incomplete work when later discovered.
[37]Furthermore, in reply to the Applicant’s claim that the Respondent’s termination notices were not legal, the Respondent argues that under cl 20.2 of the contract the owner may, without prejudice, terminate the contract where the builder fails to remedy the breaches in the earlier notice. The Respondent also pleaded the Applicant repudiated the contracts which was accepted resulting in termination.
[38]The Respondent disputes the Applicant’s contention that the defects are merely aesthetic.
[39]The Respondent contends that the application of the Bellgrove v Eldridge formula misconstrues the proper application of the definition of a “defect”.
[40]The Respondent relies on Notley, Bl v QBSA and Harvey [2005] QCCTB 100 (15 June 2006) in which Mr P Lohrisch engaged in a detailed consideration of a ‘defect’. At paragraphs 16 and 17 of his reasons, he quotes Gary Norwood Homes Pty Ltd v QBSA (unreported, Bne DC, 20/6/97) per Forno QC DCJ where His Honour held that determining the issue involved an examination of the whole of the circumstances, and his own decision in Collyer v QBSA [1998] QBT71 at pp 6-7 where it was said that “‘defective’ in its expanded statutory meaning to include unsatisfactory is, in my view, sufficient to include the circumstances where there has been a failure to comply with the contractual arrangements…”.
[41]As such, the Respondent contends that where a defect does not conform to either the specifications or the plans, the mere fact that the defect is aesthetic in nature does not preclude it from being a defect requiring remedy.
[42]The Respondent claims that all of the defect claims made by the Respondent should be allowed.
[43]The Respondent also counterclaims that the works required to be carried out by the Applicant:
a. under the first contract are not practically complete;
b. under the second contract were not commenced; and
c. that were carried out under the first contract contain defects that require rectification that far exceed the amount of the Applicant’s claim.
[44]The Respondent further claims the costs of rectification against the Applicant. The Respondent claims against the Applicant the full costs to demolish and rebuild ($204,425.91) or alternatively the full costs to rectify the extra drainage problem and to fix all defects ($240,313.22) as a debt due by the Applicant to the Respondent.
Reply and Answer
[45]In response to the defence of the Respondent, the Applicant claims:
a. There were two contracts executed by the parties, deemed Contract 1 and 2 which were comprised of:
i.the respective schedule/s and condition/s;
ii.the plans by Architect Robert Eccles Pty Ltd (the Applicant claims that there was no specification specifically nominated as it was contained in the plans by the Architect); and
iii.the foundations data by Saunders and Partners.
b. Any ambiguity should be resolved in first instance according to Clause 3.1:
“If either party finds any discrepancy or ambiguity in this Contract that party must notify the other party in writing. The parties attempt to resolve the discrepancy or ambiguity. Failing resolution the discrepancy or ambiguity is to be resolved in accordance with Clause 28.”
Clause 28.1 allows for, in the first instance, a “without prejudice conference” via the auspices of the QMBA and if that fails then recourse to the Tribunal.
c. It is not true that the architectural drawings are ambiguous as to what was to be the level of the lower slab, that the slab has been built too low or that the Applicant determined the level independently without consulting the Respondent or her husband thus causing the alleged problem.
d. The only substantive issue which is ambiguous in the documents is the issue of liability for extra electrical costs. The ambiguity as to the slab was resolved between the Applicant and Mr Magnay during the course of completion of the slab and Mr Magnay agreed for it to be formed at the level it was.
e. The Applicant submitted progress claim number 5 on 23 December 2005. According to the contract payment claim number 5 was thus due for payment by 31 December 2005.
f. The Respondent advised the Applicant on 31 December 2005 that she will be willing to pay the outstanding amount when the incomplete works were completed as scheduled. The Respondent provided the Applicant with a list of works including works outside of either Progress Claim 5 or Contract 1 to be completed before she would pay Progress Claim 5. At this stage the Respondent first repudiated the contract and was in substantial breach.
g. On 10 January 2006 the Applicant sent a ‘Notice of Intention to Terminate Contract’ on the basis that Progress Claim 5 had not been paid. The Applicant’s position was that he was entitled to this money as the Respondent had prevented him completing the work.
h. By the Respondent replying on 20 January 2006 they reiterated their original repudiation of the contract and further exacerbated their original repudiation by including substantially more items of work they demanded the Applicant should complete before Progress Claim No 5 would be paid.
i. The Respondent’s subsequent purported termination of the contract/s by their notices dated 14 April 2006 and 25 April 2006 were of no effect as the Respondent had already been in substantial breach. Furthermore, the Respondent did not comply with the contractual requirements in the giving of the purported notice.
j. There was no suspension of the works by the Applicant on 10 January 2006 as claimed by the Respondent.
k. The Respondent purported to terminate the contracts on 25 April 2006 and 26 April 2006 however the Respondent was still in substantial breach of the contract/s. The Applicant accepted the repudiation of 25 April 2006 and legally terminated the contract/s on 12 May 2006.
l. The Applicant brought to the attention of the Respondent on 29 December 2005 the fact that she had exceeded the contractual PC allowances for the electrical work and sought confirmation of her earlier instructions or an amendment to them.
m. On 31 December 2005 the Respondent confirmed that the electrical work constituted a PC allowance according to Clause 9 of the contract and sought evidence of labour and material costs in accordance with this clause which the Applicant provided on 6 January 2006. The Applicant also sought confirmation that the extra work was to be carried out.
n. According to clause 9.1 of the contract the Respondent then had to respond to these matters within 7 days, failing which enlivened clause 16.1(c) which gave a right to suspend the works and / or clause 22.1(c) which have a right to terminate the contract. The Respondent never responded to the Applicant’s request and was therefore in substantial breach of contract on this separate account as from 13 January 2006.
o. On 25 January 2006 the Applicant legally suspended the works on the basis that they were awaiting the Respondent’s signature to recommence works. This suspension was not an act of repudiation.
[46]In answer to the counterclaim of the Respondent, the Applicant claims:
a. If the Respondent fails on the argument that the lower level needs to be completely demolished and rebuilt, it does not follow that the Respondent is entitled to the full costs to rectify the extra drainage problem and to fix all defects.
b. The lower level has been constructed as per the contract and as the works were incomplete at the time the contract was terminated there is still an issue with the drainage.
c. Mr Betteridge’s costings should be preferred they being detailed and clear as opposed to Mr Constanzo’s costings which were not based on any detailed documents that would allow a precise calculation of costs.
[47]The parties filed a joint issues list which set out the issues as follows:
a. What documents comprised the Contract between the Applicant and the Respondent?
b. What was the scope of work required to be carried out by the Applicant for the Respondent under the Contract?
c. Who, and on what date, lawfully terminated the Contract?
d. Are there monies owing, in an amount of $28,099.00, by the Respondent to the Applicant for:
i. the final stage of Contract 1 in the amount of $15,800.00;
ii.a variation in relation to the electrical works in the amount of $4,254.00;
iii.profit in the amount of $8,045.00 that the Applicant would have made but for the termination of Contract 2?
e. Is the Applicant entitled to interest on any monies owing to him by the Respondent and, if so, how is any such interest to be calculated?
f. Is the Respondent entitled to liquidated damages under the Contract and, if so, in what amount?
g. Did the Applicant breach the Contract as alleged in the Respondent’s Amended Defence and Counterclaim dated 14 September 2007 and, if so, what is the amount of damages to be awarded to the Respondent for such breach?
h. Is the Respondent entitled to interest and, if so, how is any such interest to be calculated?
i. What costs, if any, are to be awarded to either the Respondent or the Applicant in this proceeding?
[48]Counsel for the Respondent in his written submissions dated 29 March 2010 posed issues that arise from the Applicant’s claim as following:
a. What the relevant terms of the contract are;
b. Whether those terms permit him to make the claim;
c. Whether the contract contains any terms that prevent him from making the claim;
d. Whether the Applicant was permitted by the contract or at law to refuse to continue working and terminate the contract;
e. Whether by making the claim, or by terminating the contract, the Applicant was in breach of contract;
f. Whether the Respondent was permitted by the contract or at law to refuse payment and terminate the contract.
[49]He also posed issues that arise from the counter claim as:
a. What the relevant terms of the contract are;
b. Whether the terms of the contract were breached by the Applicant;
c. Whether the defects particularised are “defects”;
d. Whether the defects were such as to permit the Respondent to terminate the contract;
e. What measure of damages should be allowed for the defects.
[50]The Applicant, Luke Sweeney, provided the Tribunal with a sworn statement (exhibit 2) and gave evidence before the Tribunal. Graham John Magnay and Sarah Helen Magnay also provided sworn statements to the Tribunal and gave evidence. Mr Cecil Fritz, a building consultant and a consulting engineer, Mr Michael Steer provided reports. Mr Constanzo, a quality surveyor gave evidence on behalf of the Respondents. Mr Eric Fox, Consulting Engineer, gave evidence on behalf of the Applicant. Mr Betteridge, a building consultant, gave evidence on behalf of the Applicant.
[51]The Respondent claims the building works carried out by the Applicant were defective as follows (the lettering is adopted in these reasons):
(a) cutting of weather boards to door jambs on the eastern wall of the lower level exhibit excessive gaps
(b) 2 weather boards replaced on the eastern wall of the lower level are cut short at each end; further, the checking out around the still is rough
(c) plumbing pipe on the eastern wall of the lower level is out of plumb and the tap is out of alignment; the handle is too close to the weather board
(d) lack of storm flushing over the top rear door to lower level of eastern elevation
(e) weatherboards on the eastern wall are not gauged evenly, varying from 130 - 140 mm gauges
(f) the weather board gauge is 110 mm above the north eastern quadrant of the window to the bathroom on the lower level
(g) the weather boards are secured out of level on the eastern wall of the lower level; boards run from 18 mm to 30 mm out of alignment over the lower level window
(h) the external junction of the weather boards, from the eastern and northern elevations, does not line up
(i) the weather board over the north eastern window on the rear elevation has been cut out to make clearance for a waste pipe and ripped so that it would fit into the space; there is inadequate overlap for weather proofing
(j) plv packers of weather boards are loose and hang exposed
(k) gap in the wall between the lower level weatherboards and the upper level weatherboards, at the eastern end of the northern elevation, where a board has not been installed
(I) excessive amounts of joints in the weather boards. Overall the number or short boards used is not considered standard industry practice and is causing an unsightly finish
(m) pipe work for the existing sanitary plumbing to the dwelling is too close to the dwelling and the Applicant has scalloped out the face of the second row of board around the pipe; there is consequent termite entry potential
(n) gap in the Bribie Island flashing behind the SVP causing potential water entry into dwelling
(o) northern door on the lower level shows gaps between the door jamb and the joinery stud; the weather board does not make contact with the door sill at all; there is consequently no ability to prevent moisture from entering the inner part of the dwelling
(p) weatherboards around the office entry door have been cut too short, leaving gaps and inadequate back flashing
(q) plumbing pipes from the upper level bathroom that exit the external wall at the lower level have the weather boards cut extremely roughly around them
(r) the window sills have been scribed to the frame and the external weatherboards have been cut around them instead of being scribed behind the sill protrusion to enable a weather proof joint
(s) rear wall exhibits a 25 mm gap to the northern side of the opening where the weather board has been bogged up
(t) lack of flashing in the office entry door; sill sits on slab and there is no weather seal
(u) uneven set out of weather boards at the western elevation of the front entry door
(v) new boards were supposed to be used on the new portions of the dwellings, however some old boards have been reused
(w) the board over the apex of the front portico has been cut in line with the apex and the board exhibits splits; the board is out of gauge and the joints to the left of the board are poor
(x) weatherboards on the front elevation have not been cut into the soffits
(y) reuse of old boards; approximately 65% of the wall boards have been reused; excessive jointing of weather boards have not been prepared for painting
(z) inadequate bird proofing; battens are too large and do not give an effective bird proofing barrier
(aa) fibro used to cap off ends of soffits
(bb) round portal window above the foyer entry is approximately 200 - 300 mm lower than as per the approved plan
(cc) portico entry structure does not exhibit a boxed gable as per the approve plans. The lower level gable does not match the upper boxed gable
(dd) switch box is damaged and exhibits impact
(ee) telephone cabling conduit runs out of the garden bed and up into the dwelling
(ff) water pipe that used to connect to the swimming pool has been removed and not reconnected
(gg) stump at the back of the stairs is not fully concreted up to the ground. Steel column is in direct contact with the dirt
(hh) southern side panel to the front door has a cracked pane of glass
(ii) external tap missing in the front section of the dwelling which has not been re-plumbed back in; Binding of windows evident on the lower level rumpus room
(jj) bracing defect regarding nailing spacing, inadequate transfer block, inadequate bolts, lack of washers, braces missing; house rocks when walking
(kk) frame construction is defective (despite certification to the contrary)
(II) connection of the columns to the existing bearers is done using only coach screwing and not bolts as required by the approved plans and the Building Code of Australia; no keeper plate to the barrel bolts fitted to the casement windows; raw hole in timber sill; requires brass 'L' angle cover plate
(mm) easing of all windows and doors as a result of the adjustment to the dwelling during constructions; windows and doors are not operational in some locations as a result of the adjustment to the height of the dwelling relative to each support point
(nn) bathroom cracking of the floor tiles as a result of floor framing in movement possibly during construction; grout cracking; wall floor intersections opening up; floor in the bathroom has dropped by approximately 3 to 5 mm; fire place hearth has dropped in relation to the skirting by 3 to 5 mm; second bathroom exhibits movement cracking in the floor
(oo) departure of the splashback tiles from the sink as a result of movement of the dwelling
(pp) remove shower screen to ensuite, replace cracked tile and repair waterproofing membrane undertile
(qq) painting required to areas of house due to cracking caused by movement of the house
(rr) painting required to doors and windows after easing of same has occurred
(ss) reinstate existing air conditioning unit, which was incorrectly disconnected during demolition
(tt) reinstate office including tiling and cupboards that were incorrectly demolished
(uu) replace new door seals which have been cut too short
(vv) replace window seal to original small round window above porter entry, which was wrongfully constructed
(ww) install roof structure between house and carport
(xx) install hot water system
(yy) replacement of underground sprinkler system which builder wrongfully removed
(zz) reconnect existing lights to upstairs area that had been left disconnected since initial demolition occurred
(aaa) repair to ensuite and main bathroom which have signs of mastic movement due to house improvement
(bbb) refix and repaint upstairs archway which is pulling away from wall due to house movement
(ccc) refix and repaint existing weatherboards which are letting go due to movement of house during demolition
(ddd) replace existing floor to main upstairs house area (sheets are popping due to demolition and current movement of house)
(eee) lower floor structure has been constructed approximately 135mm below the datum point provided in the plans
(fff) lower level all on East elevation is not parallel with the upper level wall
(ggg) gap at North East corner of North Wall of approximately 10mm is developing
(hhh) inward curve at West end of North wall, kink in North wall and 10mm gaps in weatherboards in North wall
(iii) North end of West wall is built forward of the upper level wall
(jjj) weatherboards above the roof flashing to the front entry portico are not straight and are cut too high in relation to the roof covering
(kkk) metal ant cap below from entry door sill is not continuous
(lll) weatherboards at front wall South are not parallel with the barge board at roof level and the fascia is too short at the front end
(mmm) the weatherboards for the right hand side of the front wall are 20mm out of level at the base
(nnn) the window frame for the right hand side of the front wall is not level or plumb
(ooo) the height of the weatherboards for the right hand side of the front wall varv from 125mm to 155mm
(ppp) the window frame at the Western end of the South wall is 8mm out of plumb
(qqq) the ant capping is damaged at locations on the South wall
(rrr) the height of the weatherboards used on the South wall varies from 115mm to 155mm
(sss) the 100mm by 1000mm hardwood posts at the front of the house are not plumb
(ttt) approximate 200mm overhang at the front portico
[52]The Respondent also claims the Works are incomplete as follows:
(a) Portion of the verandah floor which is 1160mm wide x 4100mm long consisting of 100 x 50mm of hardwood floor joists and old shot edge floor. Boards which need to be removed to allow for the constructions of the new internal stair case. This includes the removal of the flooring, including the vinyl floor and masonite underlay. Construction of the new internal staircase.
(b) Pair of front entry doors on upper lever to be removed, together with the sill and old stair riser board. This includes the removal of the lintel over the top of the entry doorway.
(c) Removal of small portion of lattice panel and balustrade to the right of the front entry upper level to make ready for further construction.
(d) Removal of five panels measuring approximately 0.9m x 1.0m plus side panels of approximately 0.5m x 0.8m to allow for new window openings to be constructed in accordance with the approved plans. Also, security grills need to be removed from the existing openings.
The northern wall of the building requires treatment of the sills on the northern cluster of windows. As a result a portion of the weatherboards will need to be removed and a fenestration panel constructed below measuring approximately 1.8m long and 0.5m deep with two splayed lower edges rising to the outer extremities.
(e) Front external ground at the entry to the building requires at least a surface treatment. The surface treatment is to abut the edge of the existing floor slab to give enough clearance for a visual barrier for termite management.
(f) Rear entry external surface treatment.
(g) Storm water drainage including surface water collection, including the installation of downpipes from the existing gutters in accordance with AS 3500.3.2.
Excavation of a trench and installation of associated pipe work to the onsite storm water council sewer at the northern side of the site is required. Approximately 30-35 mm of in ground drainage is required.
Surface water collection points are also required and these are to be placed at the base of each down-pipe dropper so as to collect water. These are to be located as follows: two on the northern elevation, one at the front, two at the southern side and one in the under croft at the rear of the dwelling.
(h) Construction of rumpus room area opening infill that will form the division infill between the hallway and the room. The framework extent is approximately 0.5m wide on each side of the existing framing and associated framework to erect the construction head to allow for the concertina doors to be constructed which are shown on the approved plans. The framework extends 5.0m long and the slab surfaces to underside of floor joists 2700mm (approximately).
(i) Incomplete works relating to the lower level of the dwelling, as a broad bullet point list:
- All internal wall linings (plasterboard and villaboard to wet areas);
- Ceiling linings (ceiling battens as prescribed on plans, together with plasterboard);
- Skirting boards, architraves, door jambs and stops;
- Cornices;
- Doors;
- Internal door furniture;
- Smoke alarms.
(j) Waterproofing to the lower level in wet areas has not been installed. Accordingly, waterproofing works to be carried out include waterproofing of two 1.0m x 1.0m showers and two internal corners to a height of 1.8 m. Sealing of the intersection floor to the wall skirting tiles or boards and around the jambs also to be carried out.
(k) Toilet, shower, vanity and laundry fixtures have not been installed.
(l) No floor coverings have been installed as per the provisional sum item for tiles (not including carpets).
(m) No wet areas surface finish areas have been installed in the form of wall tiles.
(n) Light fittings or electrical switches have not been installed.
(o) Telephone, television not installed. Pre-wire or connection points not installed.
(p) Shelving for built in robes not installed.
(q) Framing trimming to allow for completion of framing support for linings missing around proposed bulkheads, door heads, internal walls to ceiling junction, mounting blocks for toilet rails.
(r) Window hoods have not been installed as depicted on the approved plans.
(s) Bedroom 5 has not been constructed in accordance with the approved plans.(t) Earthworks in the carport area have not been completed as the carport area has not been excavated to reduce the height of the ground to suit the new lower level slab area.
(u) Old portal window opening of the upstairs front of the building has not been closed off.
(v) Works associated with (a) herein, including constructing a separating wall.
(w) Catches for the double hung sashes on the lower level bathroom and laundry have not been fitted.
(x) Putty smeared on the glass to be removed.
[53]Mr Terry Betteridge found that the first contract between the Applicant and Respondent, consisting of:
a. demolishing / restumping / new concrete slab / timber frame / windows / external doors and timber cladding; and
b. plumbing and electrical rough-in
had been substantially completed in accordance with the contract. All work was found to be of a reasonable and acceptable standard with some defects which would normally be rectified by a builder during the contract maintenance period.
[54]Mr Betteridge also found that the contract documents contain ambiguities and discrepancies.
[55]In defining the scope of the contract, the report found that the Eccles drawings 02-05 are defective in showing the required scope of work as they are marked “PRELIMINARY FOR INFORMATION ONLY”. The report notes the exception of Eccles Drawing 01A, which is not marked as preliminary, as forming the scope of the Contract.
[56]Mr Betteridge notes that in item 3 of the first contract several items of work have been incorrectly defined as prime cost items and are better described as provisional sums. Mr Betteridge makes no recommendation as to the rectification of such errors.
[57]With regards to the variations between the contract drawings and approved drawings, Mr Betteridge concludes that if such variations were to be carried out they would be legitimate variations to the contract.
[58]Mr Betteridge notes that the Eccles documents do not contain any specific structural or architectural details but appear to be intended for the purpose of obtaining building / development approval and accordingly lack sufficient detail to be used as contract documents.
[59]Regarding the scope of the first contract Mr Betteridge noted:
a. Plumbing and electrical rough-in is shown generally on the Eccles Drawing No 01A. However, Drawing 01A does not provide any hydraulics for sewer, water or stormwater. Downpipes and electrical layout are also not shown on the drawing. The Applicant’s quotation no. 341 does in fact provide an electrical breakdown for lights, GPO’s, phone and smoke alarm but that quotation is not referred to in the Contract.
b. Tiling is not included in the first Contract. Mr Betteridge believes that inclusion of a P.S. for tiling in the first Contract is an error.
c. Declarations made by the Respondent with respect to termite management confirm the concrete floor as the Saunders report with a 75 mm edge and protection at floor penetrations is the required termite management system. The site is classified as moderately reactive and the Respondent has responsibilities in this regard.
[60]Mr Betteridge found that work on the second contract has not commenced.
[61]Mr Betteridge made the following observations concerning the second contract:
a. Work on the existing or proposed upper floor was not part of either the first or second Contract;
b. During demolition, some damage to the upper floor is inevitable but any such damage is not the responsibility of the Applicant;
c. The Applicant is not responsible for any work to be carried out by the Respondent or by others on the Respondent’s behalf. This includes all work not described in the scope of work;
d. Work associated with the proposed carport Eccles Drawing 05 is not part of the Contract. Failure to demolish the existing carport, carport floor and concrete driveway has caused the Applicant to carry out work out of sequence, has caused delays and additional cost to the Applicant during excavation and other work on-site. Current grading of site is as carried out by the Respondent and is not the Applicant’s responsibility.
[62]Mr Betteridge found 17 variations in total pertaining to the first Contract. The variations, excluding a costing for variation No. 7, have been costed at a total of $2,782.72.
[63]Mr Betteridge reported that there are two items of work carried out by the Applicant that are defective. These are:
a. Flashing at connection of sawn hardwood weatherboard to timber frame and concrete floor. The cost of rectification is estimated to be $891.00.
b. Hardwood weatherboards sawn from green hardwood. The cost to rectify this defect is expected to be $1,452.00.
[64]Evidence concerning an alleged bracing defect was given in a report by Eric Fox of ETC Consulting dated 2 March 2007. The bracing requirements for the lower level of the house are detailed on the “Proposed Floor Plan” on Robert Eccles Pty Ltd drawing 03.148-01A. The design utilises plywood sheet bracing attached to the timber stud walls at the lower level.
[65]Mr Fox found no problem with the removal of the steel crossed-rod bracing as Michael Steer of Dennis, Price & Miller Consulting Civil Engineers did in his report. Mr Fox asserts that Steer’s concern disregards both the Architect’s bracing design and the plywood bracing presently installed in the works (and Steer indeed recommends the use of plywood sheet bracing). Mr Fox found that there was no design need for the crossed steel rod bracing that has been removed and that it was most likely installed by the re-stumper as a temporary measure to provide stability until the carpentry work of building in the sheeted bracing walls was complete. Further, Mr Fox comments that the use of such temporary steel braces and removal of same during subsequent works is common construction practice.
[66]Mr Fox’s inspection revealed that plywood bracing was generally in place at the locations specified by the designer. Minor re-arrangement of some bracing was found to have occurred, in particular one short section of ply bracing is missing at one corner, but Mr Fox did not consider this significant to the structural performance of the building.
[67]Mr Fox found deficiencies with the bracing walls as installed, however considered the deficiencies as not uncommon and readily correctable. In particular it was found that:
a. M12 holding-down bolts in Chemset anchors should have been installed at each end of each bracing wall;
b. Nails should have been added to vertical edges of bracing panels where required to result in an average spacing of 150 mm;
c. In certain areas the top plate of the bracing should have been more securely fastened to the underside of the floor; and
d. The section of bracing at the front right should have been installed.
[68]Mr Fox recommends installing a plywood sheet on the inner face of the wall as a practical and conservative remedy. Mr Fox added that such modifications are commonly directed as a result of framing inspection during construction and rectified as part of normal building practice, and further that the deficiencies would be considered a structural defect only if present after completion of the works.
[69]Overall, Mr Fox is of the opinion that the amount of bracing provided was consistent with the Architect’s design and that completion of the recommended works would result in the compliance of bracing requirements. Mr Fox maintains that it is desirable for these deficiencies to be rectified as soon as practicable in order to achieve the completed structure as designed but asserts that there is no sign of deficiencies consistent with a state of potential catastrophic failure as suggested in the report of Michael Steer.
[70]The floor structure of the original house comprised conventional timber flooring, joists and bearers. At some time in the past, presumably in order to allow removal of some stumps, some bearers were strengthened by the addition of steel beams bolted to the bearers. In one location an existing steel channel bolted to a bearer has been removed during the extension works.
[71]Mr Fox’s inspection revealed that the steel beam was rendered superfluous by the installation of a steel column that now supports the original augmented bearer. Mr Fox also noted that the span of the timber bearer is now approximately 2.9 m and the present deflection of the timber beam is most probably less than the deflection of the combined timber-steel bearer over the much longer span that apparently was present.
[72]In Mr Fox’s opinion the structural system presently in place is superior to that which existed, notwithstanding the removal of the steel “doubling” channel. However Mr Fox suggested that if modification was considered desirable it would be a simple matter of inserting additional timber studs within the wall to support the timber bearer at approximately mid span.
[73]Mr Fox found the maximum crack width to be 1 mm.
[74]Mr Fox asserts that the incidence of cracks in the slab is less than what is commonly found for house slabs, presumably as the slab was cast in the shade of the existing house.
[75]Further, Mr Fox maintains that the incidence, location and width of cracks in the slab are consistent with normal concrete shrinkage and within normal expectations for such slabs.
[76]In Mr Fox’s opinion, no defect exists.
Floor Structure
[77]Mr Fox’s inspection of the upper level of the house revealed only very minor cracks in tiling in the wet areas. A couple of gaps were found to be visible in cornices and the like and some jamming of joinery. Mr Fox did not observe excessive movement of the floor.
[78]Mr Fox asserts that the overall extent of defects is not excessive for a house of this age although the jamming of joinery and gapping at cornices would not normally be expected in a newly-renovated house. Mr Fox notes however that renovations to the upper level were undertaken prior to the re-stumping of the house. Mr Fox asserts that it is not clear whether the damage at the upper level is the result of the re-stumping of the house or the result of simple “settling in” of the renovated upper level. Mr Fox’s opinion is that nonetheless it is not practical or reasonable to expect a builder to fully re-build the lower storey of a house without causing any movement at all of the upper level. Further, Mr Fox believes that the relatively minor amount of damage present in the upper level is a very reasonable and expected outcome of the works undertaken at the lower level.
[79]Mr Fox noted that the structure of the existing timber floor over the existing office at lower level appears to be much lighter than is normal for such floors. In particular, Mr Fox notes that the existing timber bearers are spanning much further than is normally acceptable which could possibly result in excessive deflection and / or bounce of the floor.
[80]Mr Fox concluded that there is no evidence of serious structural defects with the renovation works. Mr Fox does note some deficiencies with bracing in particular areas however asserts that these deficiencies are not uncommon with such work and would normally be identified during the frame inspection and accordingly corrected by the builder. Mr Fox recommended undertaking rectification as soon as practicable.
[81]Mr Fox concluded that the damage evident at the upper level is very minor given the extensive work to the lower level. The extent to which the damage is the result of restumping or the result of previous renovation work is unclear. Mr Fox noted that it is unusual to undertake full renovation of the upper level of such a house prior to replacing the substructure. In Mr Fox’s opinion it is not reasonable to expect any builder to undertake such extensive structural work at the lower level without causing any damage to the house over.
Finishes to Steelwork
[82]The square hollow section posts are of DuraGal finish. Mr Fox notes that DuraGal finish provides substantial protection from corrosion, however, it is not sufficient to allow permanent exposure to the weather in Brisbane. Mr Fox recommends at least one coat of suitable paint to posts that will be exposed to the weather in the long-term.
[83]The plates attached to the DuraGal posts are of plain steel. Mr Fox considers it necessary that such plates and any parts of the DuraGal posts where the coating has been removed by welding or cutting during fabrication be painted with at least two coats of a suitable paint.
Observations & Recommendations
[84]Mr Fox notes that the posts used in the enclosed part of the lower storey are internal and thus considers that no finish is required to steelwork for the purpose of providing adequate durability. Mr Fox’s opinion is that DuraGal steelwork is accordingly suitable for the application.
[85]Mr Fox observed that the lower parts of some otherwise internal DuraGal posts are presently exposed to the weather on one face. Mr Fox found no sign of premature deterioration of any part of those posts. Mr Fox recommends that the exposed faces of these posts be painted with a suitable coating if those parts are to remain exposed.
[86]Mr Fox is of the opinion that DuraGal finish is a suitable finish for the posts used to support the deck at the rear of the house provided that they are enclosed within the next few years. Mr Fox observed no premature deterioration of the DuraGal finish on those posts. Mr Fox recommends that where the posts are intended to remain exposed to the weather for longer than a few years the posts should be painted with a suitable coating.
[87]The surface of the steel rod bracing is untreated, as are the points where the rods were welded to the faces of the DuraGal posts. Mr Fox observed some surface rusting of the rods and the welds as well as staining of nearby surfaces of the posts. Mr Fox’s opinion is that the amount of rusting is not of any structural significance however it will inevitably become more serious after several more years of rusting. Mr Fox recommends brushing off the existing rusting and painting the steel surfaces that are not DuraGal with at least two coats of suitable coating.
[88]The steel plates that have been welded to the tops of the DuraGal posts for the purposes of connecting the steel beams have been painted following fabrication however Mr Fox observed some minor rust spotting in particular areas. Mr Fox recommends re-painting those connections unless the posts are to be enclosed within the next few years.
[89]Mr Fox is of the opinion that DuraGal is a suitable finish for those posts which are enclosed or will be enclosed within the next few years.
[90]Mr Fox recommends painting the posts which will remain exposed to the weather in the long-term with at least one coat of a suitable coating.
[91]Mr Fox recommends existing rust should be brushed off the unfinished steelwork exposed to the weather and also coating the steelwork with at least two coats of a suitable coating.
[92]Eric Fox re-inspected the property on 2 October 2009 for the purpose of assessing progress of damage to the property.
Relationship between bracing and damage to linings
[93]Mr Fox formed the view that any lateral movement of the frame of the upper level of the house is likely to be normal and expected racking movement of the upper level frame rather than some reflected movement of the lower level frame.
Damage to upper level finishes
[94]Mr Fox is of the opinion that there had been some very minor increase in incidence of cracks and gaps in the two and a half years between his two inspections. However, he was unable to provide any objective evidence to support that view due to his records not indicating any change in defects.
[95]He found the minor increase in defects, if in fact in existence, to be entirely normal and expected for such construction, particularly in the dry weather climate that was being experienced at the time in question.
[96]Mr Fox disagreed with the report of Mr Fritz that attributed the increase in defects to a dust storm which occurred on 23 September 2009. He believes that the same defects were present more than two years ago.
[97]Mr Fox notes that the report of Mr Steer failed to differentiate between lateral movement of the upper and lower levels. Mr Fox stated that the lateral movement of the upper level of the house would be a much more significant factor than lateral movement of the lower level.
[98]Ultimately Mr Fox found no significant change in the level of defects present in the upper level of the house between his inspections in January 2007 and October 2009.
[99]Mr Steer observed that the frame has generally not been constructed in accordance with sound working practice. Mr Steer was of the opinion that there had been sloppy workmanship such as noggings that have not been cut to provide a snug fit thus reducing the effectiveness of the structural connection. Mr Steer also observed that the construction indicated a lack of understanding of structural load paths.
[100]Mr Steer noted that the bracing has not been installed in accordance with the Robert Eccles drawings 03.148-01A and 04.148-02. The drawings indicate that bracing type A should be in accordance with Table 8.18(h) of AS1684.2-1999, that required 30 x 2.8 dia flathead nails at 150 mm spacings and M12 roads at either end of the sheet for method A. Alternatively, method B requires nails at 50 mm spacings. Mr Steer observed, however, that nail spacings were generally in excess of 200 mm apart and further that no M12 tie-down was provided. Mr Steer concludes that the bracing provided is insufficient to provide the 6.0kN/m as per the drawings. Further, Steer concludes that it is unlikely that the bracing would provide the 3.4kN/m consistent with Table 8.18(g) of AS1684.2-1999.
[101]Mr Steer thought that there was insufficient bracing provided when compared with the design drawings. Drawing 03.148-01A indicates that there should be ten 0.9m sheets of ply bracing provided in the east-west direction. Mr Steer’s inspection, however, indicated that there was only 6.1 m of ply bracing provided in this direction. Mr Steer noted that the bracing provided would only provide a maximum resisting force of 20.7kN as opposed to the 58kN required. Mr Steer found that the house is therefore in a potentially unstable situation especially in high winds from the east-west direction.
[102]Mr Steer observed a lack of lintels provided above openings in the frame to provide transfer of load to the bottom plate and into the concrete slab and footings. Mr Steer noted that this will potentially lead to damage to doors and windows preventing them from operating in the intended manner. Mr Steer also noted that there should be double (or triple) lintels around openings to help transfer the load.
[103]Mr Steer observed that the top plate is not well connected to the studs and that the support for the top plate and ultimately the transfer of load to the footings is therefore reduced. He comments that this is undesirable and may lead to adverse loading from wind pressure. Mr Steer further noted that it could also lead to an eccentric application of load to the window frame and window that will lead to reduced performance of the window.
[104]Robert Eccles Pty Ltd drawing 03.148-02 requires that bearers be fixed to posts with 2/M12 bolts per connection. The connections that Mr Steer observed, however, had a single bolt per connection, some being as small as M10.
[105]Mr Steer noted that the builder has cut through parts of the framing beyond the mid-point. Steer concludes that this severely reduces the capability of the member and could lead to failure of parts of the frame.
[106]In Mr Steer’s opinion the builder has failed to appropriately select pieces of timber and / or the location of support timbers. Mr Steer notes that this will result in connections failing to reach their design strength capability, thus reducing the effectiveness of the structure.
[107]Mr Steer concluded that the building work does not comply with the requirements of AS1684.2-1999 residential timber-framed construction and further that it is not satisfactory for internal cladding until major modification work is undertaken. Mr Steer therefore recommends:
a. Immediate temporary bracing of the structure; or
b. Immediate provision of adequate bracing in accordance with the requirements of AS1684.2-1999; and
c. Provision of lintels over all openings as per the provisions of AS1684.2-1999; and
d. Advice of how adequate support of the structure is to be provided. This includes, but is not limited to, the support of the top plate in accordance with the provisions of AS1684.2-1999, secondary studs provided at openings, all notched studs, noggings and plates to be removed and replaced with timbers that meet the requirements of s 6.2.1.4 of AS1684.2-1999; and
e. Advice on modifications to post and plate connections to meet the requirements of drawings 03.148-02.
[108]Mr Steer observed that significant existing bracing has been removed from the lower storey of the house. Mr Steer noted that these steel members provided the equivalent of 5kN/m of bracing capacity for each pair of members. Mr Steer is of the opinion that fourteen metres of bracing is required for the lower level of the house if 72kN. Alternatively, 21 metres of plywood bracing could be used giving 3.4kN/m in line with Table 8.18(g) of AS1684.2-1999. Mr Steer recommends evenly spacing the bracing throughout the lower level walls but placing the majority of bracing on the outer walls of the structure.
[109]Mr Steer observed that a steel “C” section has been removed from one of the supporting bearers in the lower storey of the house. Mr Steer is of the opinion that the section was provided to augment the capacity of the timber member to which it was attached.
[110]Mr Steer observed evidence of concrete cracking which warrants further monitoring to see if the cracks propagate or widen. Mr Steer notes that the cracks are not large enough to cause concern structurally but may cause difficulty if surface coverings are not sufficiently flexible.
[111]Mr Steer is of the opinion that the removal of both the existing bracing and steel member with no evidence of additional members to provide the structural capacity that has been removed is unsatisfactory. Mr Steer considered that the removal of the bracing has rendered the structure unstable and could lead to failure in extreme wind events or if the structure is subject to full design loadings as per AS 1170. In extreme circumstances, Mr Steer considered that collapse of the building may occur.
[112]Mr Steer considered the issues raised by Mr Fox.
[113]Contrary to Mr Fox’s conclusions, Mr Steer’s inspection revealed that the bracing under the upstairs deck had been removed and no temporary bracing had been provided to stabilise the structure. Mr Steer noted that a higher live loading for deck structures is required under AS117.1 because permanent, imposed and other actions make this area more susceptible to changes in the load path. Whilst Mr Steer noted that bracing is essentially provided to resist the effects of wind loading, the provision of steel bracing does shorten the effective length of the structure and can impact on the stability of the structure. Mr Steer was under the impression that the bracing had not been changed since Mr Fox’s report.
[114]Mr Steer points out that he did not recommend the use of plywood bracing in his previous reports but offered it as an alternative.
[115]Mr Steer’s inspection revealed that no timber framing had been installed under the balcony where the bracing had been removed. Mr Steer’s understanding is that bedroom five under the balcony has not yet been constructed nor has temporary bracing been installed under the balcony.
[116]While Mr Steer notes that table 8.18(h) of AS1684.2 (Residential Timber framed construction) does allow for the removal of the M12 anchors and revised nail spacing when using method B, the recommended spacing of the nails in the code is 50 mm, as opposed to the 150 mm stated by Mr Fox for all horizontal fixing to the top and bottom plate. Mr Steer’s inspection revealed nail spacings exceeding 200 mm in particular locations. The architect has specified method B for bracing type “A” which requires nail spacings of 50 mm for top and bottom plates. Bracing type “B” is to be in accordance with Table 8.18(i) of AS1684.2. Mr Steer noted that there is no method B allowed in table 8.18(i) and therefore concludes that the removal of the M12 rods is not acceptable. Further, table 8.18(i) requires 50 mm nail spacings horizontally and 100 mm spacings vertically.
[117]Mr Steer is of the opinion that the installed bracing offers considerably less bracing than that specified by the architect. Mr Steer observed that the bracing provided is slightly less than 6.0kN/m allowing for the greater nail spacing than provided for in method B of table 8.18(h). Table 8.18(i) provides 7.5kN/m if installed in accordance with the standard. Robert Eccles Pty Ltd claims 128.3kN for direction A of the lower floor, which equates to 17.1 metres of bracing under table 8.18(i). Mr Steer observed that the provided bracing is less than 102.6kN based on 17.1 metres under table 8.18(h). Mr Steer concluded that less than 80% of the required bracing has been provided in direction A for the lower level.
[118]Mr Steer points out that Robert Eccles drawing 03.148-01 provides for 3.15 metres of type B bracing in direction A and 1.8 metres of type A bracing in direction B. Mr Steer therefore concludes that 23.6kN of bracing in direction A and 10.8kN of bracing in direction B has not been provided. Mr Steer considers this bracing critical because of the location under the balcony that attracts a higher live loading under the code. Mr Steer’s opinion is that the bracing currently provided is 84.0kN in direction A (as opposed to the 127.7kN required) and 48.6kN in direction B (as opposed to the 58.0kN required). Mr Steer concludes that this equates to 65.8% and 83.8% of the required bracing of the lower level in direction A and B respectively.
[119]Mr Steer thought that the lack of wind bracing provided could lead to structural deficiencies. The lack of bracing against wind loading will allow the structure to deflect more than allowable tolerances for permissible wind speed of 33km/h. Mr Steer concludes that the excessive deflection could lead to cracking of internal fixings. Mr Steer noted that bracing provides structural stability in normal use conditions but that it is difficult to state whether this would be noticeable when walking on the upper floor.
[120]Mr Steer does not agree that the structural system is superior using the timber beam after removal of the steel beam. Mr Steer notes that the difference in length is approximately 1400 mm and the deflection for 190 x 45 timber for this opening is 1 in 427. If the stress grade drops to F17 Mr Steer notes that the deflection increases to 1 in 323. A 150 PFC steel channel over 4300 mm would expect a deflection of 1 in 459. Mr Steer concluded that the addition of the timber member would only decrease the expected deflection.
[121]Mr Steer’s inspection revealed, which Mr Fox’s inspection did not, that there is an absence of double studs at openings as required by AS1684. Mr Steer is of the opinion that the lack of double studs and the omission of lintels over some of the openings have the potential to cause some sagging over openings that could lead to doors and windows sticking. Mr Steer’s recommendation is that adequate stud work surrounding the windows would alleviate the need for lintels.
[122]Mr Steer disagrees with Mr Fox’s contention that concrete cracking was less than would be expected for a normal house. Mr Steer agrees with Mr Fox that the shaded location should minimise cracking but asserts that cracking should be monitored.
[123]Mr Steer concludes that without the construction of bedroom five, and the lack of bracing, the structure is not adequately braced. Whilst Mr Steer agrees with Mr Fox’s contention that the steel bracing could be removed if the bracing had been constructed in accordance with the Robert Eccles drawings, Mr Steer asserts that the removal of bracing whether temporary or otherwise without the reinstatement of replacement bracing leaves the structure at risk of failure. Mr Steer considers that the bracing provided fails to meet the specification shown on Robert Eccles drawing 03.148-02.
[124]Mr Fritz’s inspection (noted in his Report of August 2007) revealed an increased ceiling height of the lower floor caused by too deep excavation work. Mr Fritz claims that this has created drainage problems around the outside perimeter and difficulties with the level of the existing carport slab being higher than the interior floor slab. Mr Fritz recommends rectification in line with the Steer report.
[125]Mr Fritz observed that the existing carport slab was 85 mm higher than the interior floor slabs. Mr Graham Magnay informed Mr Fritz that originally the office floor was a small step up of 50 mm from the carport slab. Mr Fritz therefore estimates that the new interior slab has been formed approximately 135 mm lower than the original office slab.
[126]Mr Fritz measured the ceiling height of the lower floor to be 2,650 mm from slab level to the underside of the ceiling battens in the office area. Mr Fritz concludes that the minimum ceiling height of 2,400 mm as required under the Building Code of Australia would be exceeded had the new concrete slab been laid at its designed location.
[127]After examination of the weatherboards, Mr Fritz agrees with the descriptions of them given in the defence document.
East elevation
[128]Mr Fritz observed in addition to the listed defects that the new lower level wall is not parallel with the upper level wall directly above.
[129]Mr Fritz asserts that at the north corner, the wall surface is 10 mm to the west and is correct at the edge of the upper decks.
[130]Mr Fritz’s inspection revealed that the wall is straight so Mr Fritz therefore concludes that the face of the wall beneath the deck will be a similar distance of 10 mm to the east of the upper wall.
[131]Mr Fritz recommends removing all weatherboards on the lower level long and short walls, dismantling and re-erecting the framing of the long wall to be plumb and parallel with the upper level wall framing, fixing the weatherboards with a consistent height gauge dimension to the outer face of the framing, ensuring that all boards are new, sound and correctly cut in and arissing all boards on the bottom outer corner and pre-priming them before erection as well as installing the required flashings.
North elevation
[132]In addition to the defects listed in the defence, Mr Fritz observed the following defects:
a. The repositioning of the east wall will create a gap of approximately 10 mm at the north east corner;
b. This wall has an inward curve in the face of approximately 20 mm between the office door and the rear corner; and
c. The bottom plate in the framing at the drainage pipe location has been positioned to swerve inwards past the drainage pipe that has been incorrectly positioned too close to the outer face of the wall;
[133]Mr Fritz recommends the following rectification works:
a. Removal of all weatherboards on lower level between office door and rear north east corner;
b. Removal of east end vertical stop and replacement with new single length full height hardwood piece;
c. Removal of waste pipe below and above ground and repositioning approximately 70 mm outwards below ground level by using an offset connection to ensure a gap between the rear face of the pipe and the face of the weatherboards and to ensure the pipe can be fitted in a plumb position above ground;
d. Disconnection of the framing to the office and shower cubicle positions which are at right angles to the outer north wall from the north wall framing;
e. Dismantle of north wall framing between the office door and the rear north east corner and re-erection to be straight and plumb; and
f. Fixing of the weatherboards with a consistent height gauge dimension to the outer face of the framing, ensuring that all boards are new, sound and correctly cut in and arissing all boards on the bottom outer corner and pre-priming them before erection.
West elevation
[134]Mr Fritz observed that the west end of the north wall is too long and has thus distorted the front upper level wall to the point that the front section of wall is now out of plumb with a kink in the wall.
[135]Mr Fritz’s inspection revealed that two weatherboards had been filled where gaps of 10 mm have formed at the ends against the end stop.
[136]Mr Fritz recommends removing all weatherboards between the front west wall and the office entry, shortening the north west corner of the framing to be in line with the relocated west wall and refixing of the weatherboards with a consistent height gauge dimension that matches the rebuilt east end of the north wall.
West elevation (front wall)
[137]In addition to the defects listed in the defence, Mr Fritz observed the following:
a. The north end of the wall is built forward of the wall above it;
b. The weatherboards above the roof flashing to the front entry portico are not cut to a straight line and are cut too high in relation to the roof covering; and
c. The metal ant cap is not continuous below the front entry door sill.
[138]Mr Fritz recommends the following rectification works:
a. Removal of all weatherboards from the north corner to the right of the front entry door;
b. Dismantling of wall framing and re-erection in line with wall above;
c. Fixing of the weatherboards with a consistent height gauge dimension to the outer face of the framing, ensuring that all boards are new, sound and correctly cut in and arissing all boards on the bottom outer corner and pre-priming them before erection.
Front wall south (facing short section adjacent to the front entry)
[139]In addition to the defects listed in the defence, Mr Fritz observed that the weather boards are not parallel with the barge board at roof level and also that the fascia is too short at the front end.
[140]Mr Fritz recommends removing the weatherboards and then refixing them after the framing is adjusted.
Front wall (right hand side)
[141]In addition to the defects listed in the defence, Mr Fritz observed the following:
a. The weatherboards at the base are 20 mms out of level;
b. The window frame is not level or plumb; and
c. Heights of gauge in weatherboards vary from 125 mm to 155 mm.
[142]Mr Fritz recommends the following rectification works:
a. Removal of window frame and refixing to be in a plumb position;
b. Removal and refixing of all weatherboards; and
c. Fixing of the weatherboards with a consistent height gauge dimension to the outer face of the framing, ensuring that all boards are new, sound and correctly cut in and arissing all boards on the bottom outer corner and pre-priming them before erection.
South wall
[143]In addition to the defects listed in the defence, Mr Fritz observed the following:
a. The window frame at the western end has been fixed in place and is 8 mm out of plumb;
b. The ant capping is damaged in one location; and
c. The weatherboard gauge height varies from 115 mm to 155 mm.
[144]Mr Fritz recommends the following rectification works:
a. Removal of all weatherboards;
b. Replacement of damaged ant capping;
c. Removal of winder frame and refitting in a plumb and level position; and
d. Fixing of the weatherboards with a consistent height gauge dimension to the outer face of the framing, ensuring that all boards are new, sound and correctly cut in and arising all boards on the bottom outer corner and pre-priming them before erection.
[145]Mr Fritz recommends the removal of weatherboards on all walls to enable the correction of the following defects:
a. Incorrect use of boards that are defective on the face or bottom edge;
b. Inconsistent gauge heights in boards;
c. Incorrectly cut boards and excessive use of short boards;
d. Incorrect use of second hand boards;
e. Incorrectly positioned wall framing;
f. Incorrect wall framing at door and window openings;
g. Incorrectly positioned window frames;
h. Incomplete and damaged ant cap flashing at the base on the west end south sides; and
i. Flashing not fitted above rear door to east elevation.
Front portico
[146]Mr Fritz’s inspection revealed the following defects:
a. 100 mm by 100 mm hardwood posts at the front are not plumb. The north side post in particular is 20 mm out of plumb on both elevations; and
b. Drawings 01 and 03 show an overhang at the front which is not dimensioned but the scale indicates a dimension of approximately 200 mm. This overhang has not been built.
[147]Mr Fritz recommends the following rectification works;
a. Demolition of roof framing and sheeting;
b. Demolition of northern timber post and concrete base;
c. Rebuilding of concrete base and correctly set in steel straps;
d. Reconstruction of post and roof framing to provide for an overhang at the front;
e. Re-sheeting of roof and fit flashings; and
f. Building of gable infill decoration.
Item (z)
[148]With regard to item (z) of the defective works listed in the defence, Mr Fritz observed that the battens fitted to the soffit above the front entry are larger than the adjacent original battens and also that the spaces between the battens are too wide.
[149]Mr Fritz recommends that the battens should be removed and discarded and also that matching battens at matching spacings should be supplied and fixed.
Item (aa)
[150]With regard to item (aa) of the defective works listed in the defence, Mr Fritz recommends removing the fibro cement sheeting and fixing timber materials to match existing construction.
Item (bb)
[151]With regard to item (bb) of the defective works listed in the defence, Mr Fritz recommends the following rectification works:
a. Removal of portal windows and formation of opening in correct position;
b. Refixing of portal window; and
c. The making good of weatherboards.
Item (cc)
[152]With regard to item (cc) of the defective works listed in the defence, Mr Fritz’s recommendations are included in item, ‘Front portico’.
Item (dd)
[153]With regard to item (dd) of the defective works listed in the defence, Mr Fritz recommends disconnection of all electrical services and removal of the damaged metal box. Further, Mr Fritz recommends the supply and fitting of a new metal box and the reconnection of all electrical services.
Item (ee)
[154]With regard to item (ee) of the defective works listed in the defence, Mr Fritz recommends the disconnection of the temporary cable and conduit and the supply and installation of new wiring protected by conduits and concealed within framing and below ground.
Item (ff)
[155]With regard to item (ff) of the defective works listed in the defence, Mr Fritz recommends the reconnecting of the water pipe as previously installed.
Item (gg)
[156]With regard to item (gg) of the defective works listed in the defence, Mr Fritz recommends the following rectification works:
a. Excavation around base of column down to concrete encasing or base concrete as found;
b. Cleaning of concrete to form an effective bond; and
c. Formation of new concrete with a domed top to finish above ground level.
Item (hh)
[157]With regard to item (hh) of the defective works listed in the defence, Mr Fritz recommends the removal of existing damaged glass and reglazing in matching glass.
Item (ii)
[158]With regard to item (ii) of the defective works listed in the defence, Mr Fritz observed that the water supply was incomplete work. Mr Fritz recommends that the binding windows be rectified as part of the removal and refitting scope.
Item (jj)
[159]With regard to item (jj) of the defective works listed in the defence, Mr Fritz recommends the rectification works be carried out.
Item (kk)
[160]With regard to item (kk) of the defective works listed in the defence, Mr Fritz recommends the rectification works be carried out.
Item (ll)
[161]With regard to item (ll) of the defective works listed in the defence, Mr Fritz recommends the rectification works be carried out. Further, Mr Fritz observed that the hardware items to the windows were incomplete work.
Item (mm)
[162]With regard to item (mm) of the defective works listed in the defence, Mr Fritz notes that movement of this type is a normal consequence of re-levelling older homes and that necessary rectification is an expected part of the scope of work included in the contract.
[163]Mr Fritz recommends the systematic inspection of all doors and windows and the making of adjustments to ensure that all units are in working order. Mr Fritz recommends that this work be completed after the lower floor is fully braced and structurally sound.
Item (nn)
[164]With regard to item (nn) of the defective works listed in the defence, Mr Fritz notes that movement of this type is a normal consequence of re-levelling older homes and that necessary rectification is an expected part of the scope of work.
[165]Mr Fritz recommends the removal and replacement of the cracked tiles in the bathroom floors, reinstating of waterproofing membrane as necessary and re-application of sealant to vertical and horizontal corners of tiling and fittings.
Item (oo)
[166]With regard to item (oo) of the defective works listed in the defence, Mr Fritz recommends the removal of the nine narrow tiles below the window sill and the replacement of these with tiles that are wider in height. Further, Mr Fritz recommends the re-application of sealant to the junction of sink and tiling.
Item (pp)
[167]With regard to item (pp) of the defective works listed in the defence, Mr Fritz recommends the removal and replacement of cracked tiles and the reinstating of waterproof membrane as required.
Items (qq) and (rr)
[168]With regard to item (qq) and (rr) of the defective works listed in the defence, Mr Fritz recommends the filling and painting to make good damages or disturbed surfaces.
Item (ss)
[169]With regard to item (ss) of the defective works listed in the defence, Mr Fritz recommends the re-installation of the air conditioning and the reconnecting to electricity supply and drain point as before.
Item (tt)
[170]With regard to item (tt) of the defective works listed in the defence, Mr Fritz recommends the installation of new ceiling linings, sheeting, skirtings, door jambs and archives, floor coverings and interior cupboards and painting to ceiling and partition.
Item (yy)
[171]With regard to item (yy) of the defective works listed in the defence, Mr Fritz recommends the supply and installation of new piping and fittings to restore the system to working order.
Item (zz)
[172]With regard to item (zz) of the defective works listed in the defence, Mr Fritz recommends rewiring as necessary and the reconnection of fittings to restore installation to full working order.
Item (bbb)
[173]With regard to item (bbb) of the defective works listed in the defence, Mr Fritz recommends the repair and refixing of timberwork and preparation for repainting at locations of stress.
Item (ccc)
[174]With regard to item (ccc) of the defective works listed in the defence, Mr Fritz recommends the repair and refixing of timberwork and preparation for repainting at locations of stress.
[205]In response to that letter the Applicant attended the site on 4 January 2006 and attended to the water penetration of the external weatherboards. On 6 January 2006 the Applicant wrote to the Respondent refuting the claims made in the fax of 31 December 2005. In respect of the costs incurred for PC items he referred the Respondent to clause 9 of the contract and he also provided an invoice for the electrical work that had been completed to date and a quote for total cost. He requested payment for the work completed.
[206]On 10 January 2006 the Applicant purported to give a notice of intention to terminate contract because payment for progress claim number 5 had not been received.
[207]On 20 January 2006 the Respondent responded to the notice of intention to terminate contract and contended that the notice was defective and contended that she had explained why the final stage of the external cladding / electrical and plumbing (rough in) had not been completed and therefore payment for that stage was not due. She also contended that the builder had breached clauses 10, 12, 12.6 and 12.4. She gave notice that the builder was obliged to remedy the defaults and after noting that it was unlikely that the builder would reach practical completion by 25 January 2006 contended that pursuant to clause 22.3 the builder was not entitled to terminate the contract.
[208]In my view, the question of whether the Applicant was entitled to make a claim for a progress payment in respect of the stage of works described as “external cladding / electrical and plumbing (rough in)” requires an examination of the work to be done and the work completed.
[209]No issue was taken with “plumbing (rough in)”. It seems to me that the potential issues with respect to external cladding were the gaps evident to the Respondent in the cladding and the failure to waterproof as well as the failure to attach external awnings. In my view, the complaints made in that respect were not a complaint about the completion of the external cladding. The complaint about waterproofing and gaps could be classified in my view as a defect. The failure to attach the awnings in my view does not amount to a failure to supply and fix weatherboards to the exterior of the lower level of the house. In other words it does not relate to the completion of external cladding.
[210]So far as the electrical rough in was concerned I find that work had been completed. Mr Love gave uncontested evidence in that regard and indeed Mr Magnay acknowledged in his statement that the electrician had finished the rough in works.
[211]On those findings, the Applicant was entitled, even though there was obviously other work still to be done in respect of the renovation, to make a progress claim.
[212]Clause 11.6 of the contract provides: “builder to make progress claims i.e. the builder is entitled to claim payment of the contract price progressively, on completion of the stages set out in part D of the appendix to the schedule. A progress claim must be in writing, certified that the works have been completed to the relevant stage and set out the amount to be paid to the builder in accordance with clause 11.7.” Attachment 7 to exhibit 2 is such a progress claim and it sets out the amount to be paid to the builder of $11,850.
[213]Clause 11.7 provides: “owner to make progress payments. On receiving a progress claim, the owner must pay the builder, within the period stated in item 20 of the schedule, a progress payment calculated in accordance with the following: (a) the percentage of the contract price set out in part D of the appendix to the schedule for completion of the relevant stage; (b) any adjustment to the contract price under this contract; (c) any other amount due and payable by the owner to the builder under the contract or otherwise”. Clause 11.8 provides that the owner has no right of set-off under the contract or otherwise to deduct any amount from a progress payment due to the builder or to hold any retentions for defects or omissions. In my view, the Respondent was not entitled to refuse to pay the progress claim made.
[214]The fact that the Applicant made some deductions for work which in my view was not part of this stage progress claim is an indulgence to the Respondent and does not detract from the validity of the amended progress claim payment given.
[215]In my view, the revised progress claim given by the builder was not defective and the failure by the Respondent to pay the claim amounted to a breach of the building contract so as to allow the builder to terminate the contract pursuant to clause 22.2.
[216]Clause 22.1 gives the builder a right to serve a notice of intention to terminate the contract if the owner fails to comply with any of its obligations under clause 11 including the obligation to make progress payments. The right is also given if the owner unreasonably fails to consent to a variation under clause 13 or 14 or fails to sign a variation document provided by the builder or is in substantial breach of the contract.
[217]Clause 22.2 provides “If owner fails to remedy breach, builder may terminate contract. If the owner fails to remedy the owner’s breach or breaches stated in any notice served by the builder under clause 22.1, the builder may, without prejudice to any other rights or remedies terminate this contract by further written notice to the owner”.
[218]I note that in the progress payment certificate the value of the progress claim is set out as $11,850. It is accompanied by a letter dated 29 December 2005 which revises the figure of $15,800 in the initial progress payment number 5 to $11,315. In my view the combination of the two meets the requirements set out under clause 11.6. That requires progress claims to be in writing and certified that the works have been completed to the relevant stage. In my view the certification does certify that the works have reached the stage described in the second box on the page headed progress payment certificate/invoice.
[219]The notice of intention to terminate given (attachment 10 to exhibit 2) in my view is an appropriate notice under clause 22.
[220]Instead of terminating the contract the builder on 25 January 2006 responded to the Respondent’s fax of 20 January 2006. In that letter he responded to the claims made by the Respondent and suggested that there be a meeting on site between the parties and a representative from the BSA or the Master Builders Association. At that stage he issued a notice of suspension of works pursuant to clause 16 of the contract based on the failure to pay the progress claim and failing to sign a variation document under clause 13 and 14.
[221]Clause 16 of the contract provides: “builders entitlement to suspend the works. The builder may, without prejudice to any of the builder’s rights under this contract or at all, suspend performance of the works where the owner; (a) fails to comply with any of its obligations under clause 7; (b) fails to comply with any of its obligations under clause 11; (c) fails to provide the builder with any information requested by the builder under clause 9; (d) …; (e) unreasonably fails to consent to any variation under clause 13 or 14 or fails to sign a variation document provided by the builder; or (f) is in breach of any term of this contract”.
[222]Clause 16.2 requires the builder to immediately notify the owner in writing of the suspension and the grounds of the suspension. In my view, that was done by the notice which is part of annexure 13 to exhibit 2. Section 16.3 obliges the owner to remedy the breach within seven days.
[223]Rather than attempt to remedy the breach of which notice was given in the suspension notice, the Respondent purported to give a notice pursuant to clause 20.1 on the basis that the builder unlawfully suspended the carrying out of the works by his notice of intention to terminate dated 10 January 2006 and the notice of suspension of works dated 25 January 2006.
[224]The Respondent also relied on clause 20.1(c) alleging that the builder “refused and persistently neglected to remove or remedy defective work or improper materials so that the works were adversely affected. The defective work and improper materials had been notified in the owner’s letters dated 29th December 2005 and 20th January 2006”. She also alleged that the builder carried out defective work as set out in a property inspection report and a reporting quote by Peter Richie Plumbing.
[225]Clause 20.3 provides “Owner may not terminate contract in certain circumstances. The owner may not terminate this contract if the owner is in substantial breach of this contract.”
[226]On my findings set out above the owner was in substantial breach of the contract and in my view was not entitled to terminate the contract.
[227]I am of the view that the builder did not unlawfully suspend the carrying out of works. His notice of intention to terminate was not unlawful nor was the notice of suspension of works.
[228]On 21 April 2006 Sawford Vol the lawyers representing the Applicant proposed in response to the intention to terminate notice that the builder withdraw his progress claim and variation and immediately recommence construction and undertake rectification work to commence on 24 April 2006. That letter purported to address all of the rectification work except for claims which fell outside the scope of work required or were claims that amounted to damages outside the terms of the contract.
[229]By letter dated 25 April 2006 the Respondent purported to terminate the contract pursuant to clause 20.2 of the contract.
[230]Because of my finding that the owner was precluded from terminating the contract because she was in substantial breach of the contract I find that the notice of termination issued pursuant to clause 20.2 was of no effect.
[231]I note that the Respondent in giving the notice of termination purported to rely on the builders’ acts, defaults and omissions in having failed to remedy the defects and breaches she had listed. In my view the offer made in the letter of 21 April 2006 from Sawford Vol did address the items which were defective or incomplete.
[232]Concerning the claim for variations – because of changes to the electrical requirements of Mr Magnay I am satisfied that the map or electrical plan which is attachment 6 to exhibit 2 was completed by Mr Magnay and it did require a substantial increase of required electrical work. Clause 12 of the contract deals with variations by agreement.
[233]Clause 12.1 allows either party to give to the other a written notice requesting a variation of the work. Clause 12.3 allows the parties to vary the works by adding or omitting work from the works and it provides “the builder must ensure that the parties’ agreement to vary the works is put in writing in a variation document signed by the builder and the owner within the shortest practicable time and before any work the subject of the variation is carried out”.
[234]Here although a variation document was sought to be signed at a later stage and an electrical plan was provided, there was no agreement in writing signed by the builder and the owner before any work the subject of the variation was carried out. Further the requirements of clause 12.4 in respect of the variation document were not complied with.
[235]The DBCA in Part 7 deals with variations of contracts. Section 79 requires the variations to be in writing and section 80 deals with the general contents of the variation document. Section 84(b) deals with the right of the building contractor to recover an amount for variation if the variation was originally sought by the building owner only if the building contractor has complied with ss 79, 82 and 83 of the DBCA. That has not occurred here. Section 84(4) allows a tribunal to approve the recovery of an amount by a building contractor for a variation only if the tribunal is satisfied that – “(a) either of the following applies – (i) there are exceptional circumstances to warrant the conferring of an entitlement on the building contractor for recovery of an amount for the variation; (ii) the building contractor would suffer unreasonable hardship by the operation of subsection (2)(a)(3)(a); and (b) it would not be unfair to the building owner or the building contractor to recover an amount”.
[236]In my view, the circumstances which pertain here were not exceptional circumstances so as to warrant the conferring of an entitlement on the building contractor for recovery of an amount for the variation. The circumstances were not out of the ordinary and indeed it is common occurrence for a home owner or a builder to raise a variation to the works.
[237]The term “unreasonable hardship” used in section 84(4) has been considered by Member Lohrisch in Ross v Rangel [2004] QCCTB 98 (28 May 2004) paragraph 66 when he said:
“there are as well two aspects to the word “hardship”, namely that which the sufferer of hardship thinks he is suffering, and that which a reasonable bystander with knowledge of all the facts would think he is suffering; Rukat v Rukat [1975] 1 All ER 343 at 351 per Lawton LJ. Further, the word “hardship” was determined as meaning, in the context of the Landlord and Tenant (Amendment) Act 1948 – 1986 (NSW) as comprehending any manner of appreciable detriment whether financial, personal or otherwise and that each case must depend on its own particular facts: O’Brien (FG) UD v Elliott [1965] NSWR 1437 at 1475 per Asprey J. ... It is in the context of the above that I should now consider the addition of the word “unreasonable” as a qualification to the meaning of the word “hardship” within the section. I consider the meaning to be attributed to the word “unreasonable” is not as with perhaps the word “undue” which is, in some cases, associated with “hardship” (that is to say excessive or out of proportion), the law akin to equity, justice and fairness. Again the determination is to be made in all of the circumstances and as not as might perhaps a qualification such as “undue”, necessarily disqualify an Applicant who has been guilty of inadvertence or misapplication of the correct procedures”.[1]
[1]See LIDA Build Pty Ltd v Miller (Number 2) [2010] QCAT 431 and Black, G. D Toowoomba Resort Pty Ltd [2007] QCCTB 122 (3 September 2007).
[238]In my view the works here have been carried out at the request and according to the electrical plan provided by Mr Magnay. His wife has received the benefit of the works. In my view the Applicant would suffer unreasonable hardship by not being able to recover the amount spent for the works the subject of the electrical plan. Further, in my view, in those circumstances it would not be unfair to Mrs Magnay for the Applicant to recover.
[239]In the circumstances of my findings it is now necessary to consider the counter claim. The Respondent submitted that because of section 17A DCBA that the two contracts I have set out above should be considered as a single contract for which the contract price is the sum of the two.
[240]Section 17A of the DBCA provides: “multiple contracts for the same domestic work. (1) This section applies if a building contractor and building owner enter into two or more separate contracts that – (a) could be the subject of a single contract for carrying out domestic building works; (b) if they were the subject of a single contract, would be a contract for carrying out domestic building work. (2) The separate contracts are taken to be a single contract for which the contract price is the sum of the contract price for the separate contracts”.
[241]“Domestic building work” includes the renovation, alteration, extension, improvement or repair of a home. Clearly the work encompassed in both of the contracts could be the subject of a single contract for carrying out domestic building work and if they were the subject of a single contract would be a contract for carrying out domestic building work. My finding means that the separate contracts are taken to be a single contract for which the contract price is the sum of the contract prices for the separate contracts. In that circumstance the findings I have made with respect to purported termination, suspension and the giving of notices applies as if the contracts were one.
[242]The Respondent, by way of counter claim, claims that in breach of the contract the Applicant failed to carry out and complete the works in an appropriate and skilful way and with reasonable care and skill in accordance with the plans, specification and all relevant laws and legal requirements and failed to make good damage caused to the existing premises by the works.
[243]In paragraph 39 of the third amended defence and counter claim the defective building works alleged are set out as are incomplete works.
[244]Of all of the claimed defects the major claim relates to the pleading that the “lower floor structure has been constructed approximately 135 mm below the datum point provided in the plans”. As a consequence of that alleged breach the Respondent claims loss and damage being calculated as the costs of demolition and reinstatement in accordance with contract 1, slab raised and rectification of defects to lower level. Because the claims to demolish and rebuild amount to $125,539.91 plus preliminaries of $21,962.41, and because if that course is appropriate the rectification to and the fixing of defects to the lower level would not be necessary, it is appropriate to consider whether demolition and rebuilding should occur.
[245]At the same time because the alternate claim includes a remedy for extra drainage because is what is said to be a problem caused by the lower floor slab in the sum of $145,737.49 it is also appropriate to consider the question of the necessity of the drainage option at the same time.
[246]In having regard to those matters in accordance with the principles set out in Belgrove v Eldridge (1954) 90 CLR 613 I consider “the cost, in excess of any amount of the contract price unpaid, of reasonable and necessary work to make it conform to the contract plus consequential losses by reason of the breach.”
[247]If there is a departure from the contract or defect the Respondent is entitled to the reasonable cost of rectifying that departure or defect so far as it is possible subject to a qualification. The qualification is as stated in Belgrove v Eldridge at page 617 “the measure of the damages recoverable by the building owner for breach of the building contract is… the difference between the contract price of the work or building contracted for and the cost of making the work or building conform to the contract, with the addition, in most cases, of the amount of profits or earnings lost by the breach”. “The qualification however, to which this rule is subject is that, not only must the work undertaken be necessary to produce conformity, but that also, it must be a reasonable course to adopt”.
[248]Here the claim is that the slab was constructed lower than that which was indicated in the plans. Mr Fritz a building expert called on behalf of the Respondent in August 2007 (exhibit 19, page 4) gave evidence that the finished surface was 135 mm too low. Later Mr Fritz in exhibit 20, item 3.3 at page 3 gave evidence that the slab should be raised 175 mm and later asserted in his oral evidence that it should be 250 mm. Mr Fritz measured the ceiling height to the height of the slab as 2,650 mm.
[249]Mr Magnay, when giving evidence, said that the old height in the office between the ceiling and the floor was between 2,580mm and 2,560mm with the underside of the beam being 2,410 mm.
[250]The impediment to leaving the slab level as it is, is said to be a concern with the draining of the property. That is, it is said, because the level of the slab is lower the property is not properly drained as it would have been had the proper height and proper drainage been constructed.
[251]Mr Steer, the Respondent’s engineer, gave evidence that there were major drainage problems around the house concerning stormwater. He said that the property was located in an overland flow path as designated by the Brisbane City Council and had to deal with water flowing across the land from surrounding properties which were geographically higher. It appears from the attachment to Exhibit 31 that part of the property in question is affected by an overland flow path. Mr Steer noted that that path would appear to be very close to the rear of the residence and may impact on bedroom no. four. His view, as expressed in Exhibit 31, was that “the Magnay property is within an overland flow path for local flooding and therefore the habitable rooms need to be 500mm above the 50 year ARI event”.
[252]In Exhibit 29 he commented on what was a quote given for the connection of the house drainage to Council stormwater as part of the house construction. He did not think that proposal was sufficient to fully address the slab level issue and drainage. He commented, “the placing of the slab at a correct height would have provided greater immunity from flooding, however, in extreme events there would have been some likelihood of inundation. In saying this, it must be noted that the event would have needed to be of greater severity than a 50 year ARI event and is likely to be covered by insurance. The current slab is lower than the 50 year ARI event inundation level and therefore not likely to be covered by insurance in the event of flooding.” Later, in the same report, he said, “the placing of the slab at the correct height would have provided greater immunity from flooding, however, in extreme events, greater than 20 year ARI there would have been some likelihood of inundation”. Later, in the same report, he also said, “the proposed solution raises several ancillary issues that could adversely affect other structures in the house. To ensure that the habitable areas are at least 300mm above the 50 year ARI event would require approximately 300mm be excavated from around all sides of the house. This could lead to undermining the house, concrete block fence and retaining walls.” This does not directly marry with the quote in Exhibit 31.
[253]During cross-examination, Mr Steer, after being referred to the architectural drawings and the Building Certifiers Form 6 – Development Application Decision Notice, agreed that the architectural elevation shown in Exhibit 18, Attachments 9 and 11, showed that if the work had been done according to the scope of works shown in the plans, the lower floor would nevertheless be located below the existing ground level. He was then of the view that the house should never have been certified to allow the lower floor to be located below the existing ground level as the site was within an overland flow path.
[254]That evidence readily leads to a conclusion that whether or not the level of the slab was as designed, the house would still be confronted with the drainage problems it is apparently now facing with respect to extreme events.
[255]However, if the slab was built to the correct height, it would have provided greater immunity from flooding and water would have been higher with respect to the adjacent carport level. In my view it is reasonable and necessary to raise the slab to the correct level, however, the Applicant should not be responsible for the cost of any “drainage solution” to deal with extreme events.
[256]It is appropriate to deal with the claim by the Respondent for damage caused by the Applicant in carrying out the works to the lower level.
[257]In this case, the Contract was for the removal of the posts on the underside of the house whilst maintaining the height of the house at the same level and building under the house. That exercise of itself meant that there would inevitably be movement in the house and as a consequence there may be some cracking of floor tiles, movement in window frames and movement in floors and walls. The fact of such movement was not necessarily because of any negligence or poor workmanship.
[258]The Respondent pleaded that the Applicant “failed to make good damage caused to the existing premises in particular the upper level of the premises by the works”. That was based on a claim that it was an express or implied term of the Contract that the Applicant warranted “he would make good any damage caused to the existing premises and in particular any damage to the upper level of the premises by the carrying out of the works”.
[259]I can see no basis for that claim. It is certainly not an express term.
[260]The Respondent submitted that “whilst it can readily be accepted that conducting extensive renovations to the lower floor may result in damage upstairs, it is submitted that unless the Contract excludes responsibility for it, damage caused by the actions of the builder ought to be remedied by the builder”.
[261]The experts in the case considered it likely that damage would occur because of the nature of the renovation. I can see no basis for the claim that unless the Contract excludes responsibility any damage caused because of the renovation ought to be remedied by the builder. I do not regard the implication of such a term as necessary for business efficacy.
[262]As part of this dispute, a question arises as to whether the existing office to the lower floor should have been demolished. The Respondent claims by way of counterclaim (Item 81(a)-(tt) - $15,000) and relies on a note on the relevant architectural drawing as follows: “existing office ceiling to remain”.
[263]Both sides agree that as part of the contractual documents, there is the soil test and slab design by Saunders & Associates dated 17/11/03. That document shows the work, including footings associated with the construction of the concrete slab to the lower floor level. That gives rise to some ambiguity in the contractual documents. In my view, given that soil test and slab design, the existing slab had to be demolished and accordingly, as a matter of practicality, so did the existing office walls. That being so, the tops of the existing office walls, where they intersected with the existing ceiling, would also have had to be demolished. An electrical plan, as provided by Mr Magnay, shows positions of light fittings into the proposed office. That clearly meant that more of the existing office ceiling had to be demolished so as to complete the necessary electrical work. In my view, there is no basis for the counterclaim of $15,000 to “reinstate office including tiling and cupboards that were incorrectly demolished”.
[264]The Respondent counterclaims for what she says is the incorrect positioning of a portal window above the main entry on the western elevation. She claims that it was positioned 200-300mm out of place (counterclaim Item 81(a)-(bb) - $300). Whilst there is some question about the positioning of the window on the drawings (given that no dimensions are supplied), I am of the view that the Respondent was entitled to have the window placed as it is shown on the drawings and that has not occurred. In my view, that portion of the counterclaim should be allowed.
[265]The Respondent counterclaims for an improper use of fibro to cap off the ends of soffits (counterclaim Item 81(a)-(aa) - $400) and an incorrect construction of a gable to the portico entry such that the lower level gable does not match the upper boxed gable (counterclaim Item 81(a)-(cc) - $600). That seems to be so. The Applicant resists the claims on the basis that the contract documents are silent and there was no complaint after the installation of the material. In my view the claim for all of those items should be allowed.
[266]The Respondent claims that the telephone cabling conduit, where it connects into the house, is able to be seen and it should not be seen (counterclaim Item 81(a)-(ee) - $300). The contract documents are silent on that issue as they are on a claim that a water pipe which was previously connected to the swimming pool should have been reconnected (counterclaim Item 81(a)-(ff) - $400). That being the case, in my view those aspects of the counterclaim are not made out.
[267]Similarly, a claim that a tap which previously existed in the front section of the drive has not been reconnected (counterclaim Item 81(a)-(ii) - $350) is also not made out.
[268]The same applies with respect to a claim that an air-conditioning unit which was disconnected during the course of construction should have been reconnected (counterclaim Item 81(a)-(ss) - $850). That claim is not made out.
[269]A counter claim for the cost of any painting that may have been required to the first floor of the house following re-stumping, and any consequence from movement to the existing structure, is claimed in the sum of $4,760 (counterclaim Item 81(a)-(qq); (rr); (bbb); and (ccc)). In my view that claim is not made out. It is not part of the obligations of the contract and the evidence was to the effect that it was, in any event, an obligation of the Respondent.
[270]The Respondent claims $1,750 by way of counterclaim (Item 81(a)-(ww)) for the installation of a roof structure between the house and carport as shown on the architectural drawing 03.148-05. The difficulty with that claim is that for there to be any such roof, there had to be a carport. The notation on the drawing is: “five degree roof fix to house stud work and carport fascia”. The carport was not included in the builders’ contracts and the builder was directed that the existing carport was to remain. In those circumstances, the building of the roof structure between the house and proposed carport was not included in the contract.
[271]The Respondent claims $6,500 (counterclaim Item 81(a)-(ddd)) for the replacement of the existing floor to the main house upstairs because of popping due to the restumping of the house. In my view, that claim is not made out. The evidence was that the contract did not contain any obligation on the part of the builder to make good any damage which may occur because of the restumping. The evidence was that such damage was inevitable. I note that an inspection by the Building Services Authority in May 2006 was unable to detect popping, but noted that the edge of the underlay sheets was evident because of years of wear.
[272]A claim of $2,500 is made in the counterclaim (Item 81(a)-(yy)) for the replacement of an underground sprinkler system which was said to be wrongfully removed by the builder. In my view, the evidence did not make out the wrongful removal or that the replacement of the underground sprinkler system was included in any scope of works.
[273]There is a counterclaim for $3,250 (Item 81(b)-(d)) for the removal of five panels to allow for new window openings to be constructed in accordance with the approved plans. That work is shown in the architectural drawings and, on the evidence, the amount claimed should be allowed.
[274]The sum of $1,800 was counterclaimed (Item 81(b)-(f)) for the construction of a concrete slab said to be shown in architectural drawing 1. The drawing, in my view, is not that clear and does not indicate that there is to be a slab. The accompanying relevant contract documentation does not, in the engineer’s concrete slab plan, show such a slab. I understand that counterclaim was deleted.
[275]A claim in the sum of $4,500 is made for the construction of stormwater drainage and the installation of downpipes from the existing gutters (Item 81(b)-(g)). The contract does not deal with such construction and I am unable to see that such construction is part of the extended works required.
[276]A claim is made for incomplete works to the lower level (counterclaim Item 81(b)-(a); (b); (c); (h); (i); (j); (k); (l); (m); (n)-(q) and (b) - $51,350). All of those items were allegedly part of the scope of works under the second contract which I have determined should be read with the first contract as one contract. In my view, the Respondent was not entitled to terminate, or seek to terminate that contract as she did. The Applicant acted on her purported termination and accepted her repudiation, and then terminated the contract on 12 May 2006. The Respondent has no entitlement to the claim for alleged incomplete works.
[277]The Respondent purported to give notice terminating the second contract pursuant to s 90 of the DBCA. The basis articulated was that the works were not completed within one and a half times the initial contract period, including allowed delays. It was the case that that work had not commenced. It is also the case that the parties had agreed to suspend those works whilst negotiations were carried out in an attempt to resolve the dispute. Contract 2 could not be commenced until Contract 1 had been completed. In my view, in those circumstances the purported termination pursuant to s 90 of the DBCA, was not a valid termination.
[278]A claim in the sum of $3,500 was made for the construction of window hoods as shown on the approved plans (counterclaim Item 81 (b)-(r)). The Respondent is entitled to have those window hoods constructed. The claim is allowed.
[279]A claim is made that the builder was responsible for the construction of bedroom 5 (counterclaim Item 81(b)-(s) - $3,500). On the evidence, I do not see that there is any obligation on the Applicant to construct bedroom five.
[280]It is also claimed that the builder was responsible for earthworks in the carport area. In my view, the evidence does not establish that to be so.
[281]Evidence was given by two building experts, Mr Terry Betteridge, for the Applicant, and Mr Ces Fritz, for the Respondent. Reports were tendered and each of them was cross-examined. I had the benefit, during the hearing of this matter, of a view of the subject house. Generally, subject to the findings I have made herein, I prefer the evidence of Mr Fritz and at the view I could see the defects he has discussed.
[282]So far as the hydraulic evidence is concerned, I accept the evidence given by Mr Michael Steer.
[283]I note the evidence of Mr Betteridge concerning the drainage problems and his costings, however, I prefer in that respect the evidence of Mr Steer and the evidence of the quantity surveyor, Mr Flavio Constanzo. I have had regard to the evidence given by Mr Fox and Mr Steer so far as the sufficiency of the bracing is concerned. I note Mr Fox recommended that various defects in that regard be rectified as soon as practicable but in the end I prefer the evidence of Mr Steer (Exhibit 13) as to the extent of the structural deficiencies.
[284]Subject to the specific findings herein where I have disallowed part of the counterclaim and some works for which I have found the Applicant is not liable, I accept the evidence of Mr Fritz, Mr Steer and the costings of Mr Constanzo.
[285]The submission on behalf of the Applicant is that on a finding that the Applicant legally terminated the contracts, the damages should be:
·$14,200 (progress claim less allowances)
·plus $4,225 variation
·plus $8,045 loss of profit on Contract 2
·plus $15% interest on 26,470.
[286]I will allow interest on $18,425 since the profit on the second contract was not an overdue payment, that contract having been terminated. The interest allowable is $13,818.75.
[287]Applying the evidence and my findings, the counterclaim should be allowed as follows:
·Rectification of defects and slab as set out in exhibit 20, the supplementary Report of Fritz Constructions as costed by Mr Costanzo in exhibit 37 $145,737.49
·Preliminaries $21,431.12
Total $167,158.61
[288]In my opinion, the other rectification claims are now provided for by the work set out in exhibit 20. For the reasons articulated earlier herein, I do not allow the upper floor rectification.
[289]Adjusting the amounts found herein, I order the Applicant to pay the Respondent the sum of $126,869.86 by 4pm on 28 March 2011.
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