Mt Cotton Constructions Pty Ltd v Jonathon Campbell t/as Signature Painters

[2014] QCAT 429

CITATION: Mt Cotton Constructions Pty Ltd v Jonathon Campbell t/as Signature Painters [2014] QCAT 429

PARTIES:	Mt Cotton Constructions Pty Ltd (Applicant)
v
Jonathon Campbell t/as Signature Painters (Respondent)

APPLICATION NUMBER: BDL132-13

MATTER TYPE: Building matters

HEARING DATE: 20 and 21 May 2014

HEARD AT: Brisbane

DECISION OF: Member Allen

DELIVERED ON: 1 September 2014

DELIVERED AT: Brisbane

ORDERS MADE: 1.    The application is dismissed.

CATCHWORDS: BUILDING DISPUTE – contract partly written partly oral – whether work invoiced represented agreed additions and variations

APPEARANCES and REPRESENTATION (if any):

APPLICANT: Mr Christopher Scroope, Director appeared for Mt Cotton Constructions Pty Ltd

RESPONDENT: Mr Jonathon Campbell appeared for himself.

REASONS FOR DECISION

1. Mt Cotton was contracted to provide construction services for Mr Cleve and Mrs Oldham at 47 Formosa Road, Belmont in 2012. Signature Painters was requested to quote on the painting work and ultimately were engaged to paint the interior and exterior of the dwelling. Signature Painters issued a series of invoices in respect of the work only some of which were paid.

2. Signature Painters made an application for adjudication under the Building and Construction Payments Act 2004 (Qld) and was successful in obtaining an award of the amount outstanding plus the adjudicator’s fees in the amount of $20,926.

3. Mt Cotton had filed its response to the application late and it was not taken into account in the adjudicator’s decision. Following payment of the adjudication award Mt Cotton issued a tax invoice to Signature Painters in respect of what it said was an overpayment following the award, the adjudicator’s fees and an amount for defective paint work which had been to another painting contractor, Rendcraft Pty Ltd in the amount of $20,976.07. Mt Cotton has made this application to the Tribunal seeking an order that Signature Painters pay it the amount demanded in its invoice.

4. There is a question in regard to what constituted the contract in respect of the matter. Mt Cotton contends that the contract included Signature Painters original quote and the terms set out in Mt Cotton’s standard purchase order[1]. The first term of the purchase order is that the contract together with conditions specified herein will be deemed to have been accepted upon signature of both parties.

   [1]Exhibit B annexure b.

5. Signature Painters denied ever having received the purchase order and Mt Cotton was not able to provide a signed copy of it. The Tribunal therefore is not satisfied that the contract is embodied in the purchase order. One of the requirements of the purchase order was that variations be subject to a site instruction from Mt Cotton and it has been argued that much of the additional work done by Signature Painter’s was in respect of unauthorised  variations as there was no site instruction. As this requirement is not part of the contract the lack of a site instruction is not sufficient to enable Mt Cotton to require repayment by Signature Painters. The terms and conditions also had specific requirements in regard to the payment of invoices which also will not now form part of the agreement between the parties.

6. During the course of the work Signature Painters dealt mostly with Mr Guy Morris, the site manager for Mt Cotton, and they claim it is he who authorised the variations and it is to him that they emailed the invoices in respect of the work done. Mr Morris in his evidence though denies that he authorised variations other than those which were subject to site instructions issued by Mt Cotton.

7. The original quote was a lump sum quote for painting works in the sum of $13,310 inc GST. This was emailed to Mr Morris on 20 August 2012 and a return email signified acceptance of the quote on 26 August 2012. Signature Painters claim that work commenced on 27 August 2012 as indicated in emails between Signature Painters and Mr Morris. There are also invoices form Dulux to show paint for Formosa Road was ordered between 27 August 2012 and 3 September 2012.

8. The first invoice for work done in accordance with the quote was invoice 407 which was issued on 19 September 2012 in the amount of $13,310. An amount of $12,644.50 was paid by Mt Cotton on 30 October 2012 with a remittance advice confirming it was in respect of this invoice. The amount was less than that claimed as an amount of 5% was withheld for retentions, though this was not explained to Signature Painters.  This then was payment for the sum total of the original contracted work. The next invoice was INV415 in the amount of $4,312 which was for several lump sum variations including painting a tennis gazebo and pool gazebo, post, hand rails and balustrades and garage door and front doors and was also issued on 19 September 2012. This invoice was paid on 23 November 2012 in the amount of $4,096 with a 5% retention. A further invoice INV022 was issued on 22 September 2012 this was for extra hours due to working around other trades and other delays and was charged at an hourly rate of $70 per hour. There was an amount of $2,800 plus GST for the interior and $1,400 plus GST for the exterior.  This invoice was not paid.

9. Mt Cotton have argued that there was no agreement in regard to any hourly rate and that an hourly rate if it were to be charged should have been a lesser amount of between $45 and $60, with examples from labour hire firms. Signature Painters have provided material from Master Painters Australia that shows the hourly rate for painting contractors should be between $50 and $80 per hour. Signature Painters allege that Mr Morris was aware of the hourly charge rate and accepted it. This is denied by Mr Morris and Mr Scroope.

10. The specific invoices issued by Signature Painters are as follows:-

    a)    Invoice 407 dated 19 September 2012 amount $13,310 inc GST;

    b)    Invoice 415 dated 19 September 2012 amount $4,312 inc GST;

    c)    Invoice 022 dated 22 September 2012 amount $4,620 inc GST;

    d)    Invoice 023 dated 27 September 2012 amount $6,050 inc GST;

    e)    Invoice 024 30 dated October 2012 amount $3,113 inc GST;

    f)     Invoice 025 dated 14 December 2012 amount $5,500 inc GST (superseded by Invoices 027 and 028);

    g)    Invoice 027 dated 19 December 2012 amount $682 inc GST; and

    h)   Invoice 028 dated 19 December 2012 amount $4,818 inc GST

11. The payments made by Mt Cotton are also as follows:-

    a)    30 October 2012 Invoice 407 $12,644;

    b)    16 November 12 Invoice 023 $3,444 (for painting of shed and resealing render patches which were subject to a site instruction); and

    c)    23 November 2012 Invoice 415 $4,096

    d)    An amount of $961.60 was said to have been retained from these invoices.

12. There are a series of emails between the parties which have been filed by Signature Painters which tend to indicate that there was no issue with the invoices provided by Signature Painters but there were issues with Mt Cotton’s ability to pay due to it having outstanding debtors and that some invoices had been sent to Mr Morris and not Mt Cotton’s accounts department. The Tribunal notes that Mr Morris did not any stage state in an email to Signature Painters that the invoices should be sent to anyone but him.

13. The first payment was received after a series of emails between Elizabeth Campbell and the accounts staff at Mt Cotton[2].  An email was sent by Signature Painters with two invoices on 27 September 2012 requesting confirmation of when they would be paid. On 8 November 2012 Guy Morris replied stating he would call later today or in the morning. His next email was 13 November 2012 where we states “he needed to drop you a line regarding payment for works at Formosa, I know there have been issues in this regard and we are hoping to get things sorted in the near future, Mt Cotton are not immune to the problems at the moment with 1.5 million owed to them[3]. At this time all but the last two invoices had been issued and there were no problems raised about the invoices themselves only Mt Cotton’s ability to pay. A further email was sent by Signature Painters to Mt Cotton on 22 November requesting confirmation that the outstanding amount owing of $15,416.00 would be paid before they undertook defects works which would require them to expend monies[4]. Mr Scroope replied “Beth you finish the defects tomorrow and you will be paid tomorrow a part payment will go in today”[5]. The part payment is noted would have been the amount of $4,096.00. Clearly having regard to the request for confirmation in respect of an outstanding amount of $15,416 it cannot be argued that Mt Cotton was only referring to payment of the amounts which it considered should be paid. Signature Painters following this email and the payment undertook further work and issued invoice 025 which was later split into invoices 027 and 028.

    [2]Exhibit 6 paras 7 – 12.

    [3]Exhibit 6 attachments I and J.

    [4]Exhibit 6 attachment k.

    [5]Exhibit 6 attachment k.

14. The main reasons given by Signature Painters for the extra work was that they are a finishing trade and would normally come to the job after the other trades had finished and there quote was based on them performing their work using a system which required them to have clean access to the site. Whereas here they were working they were required to work around trades which added time and this was allowed for by Mr Morris. There were also many issues with the plasterwork specifically air bubbles which meant that they were doing an unusual amount of preparation and repair work. There were coverage problems with some of the paint which meant a third coat had to be applied at additional cost and finally as other trades dealt with their defects repaints would be required and they performed those services which they were entitled to be paid for as it was not Signature Painters defects.

15. All of this is denied by Mt Cotton in its material but this is not reflected in the course of email correspondence between the parties. Mt Cotton claim that the defects which Signature Painters say it should be paid for are its own defects and there is no entitlement to payment and that there is no ability to obtain payment from the home owner in respect of these amounts.

16. There is no indication in the email sent by Signature Painters with the invoice for hourly rate work that this had not been agreed. In fact it would tend to show agreement as there is nothing tentative about it. Mr Morris’ email also does not indicate any problem with the invoices but acknowledges as mentioned above that Mt Cotton is having issues with its creditors and so payment has been delayed. There is also the specific email to Mr Scroope requesting confirmation of payment before some further work is performed. The only issue he raises is that the defects be rectified and he indicates that a part payment will be made. The part payment was made but no further amounts were received. The Tribunal notes from the Jeffrey Hills report that it is around this time that Mt Cotton walked off the job.

17. While Mt Cotton and Mr Morris have denied any authorisation in respect of the later invoices issued by Signature Painters the Tribunal is satisfied from the emails provided by Signature Painters that there was no issues raised by Mt Cotton in regard to those invoices after they had been issued and that the issues in regard to the work on the site justify the work which is the subject of the invoices. For that reason Signature Painters is entitled to retain the amount paid to it by Mt Cotton in respect of the invoices.

18. Mt Cotton also claimed for the payment made into Rendcraft Pty Ltd for defects. The invoice provided by Rendcraft[6] was dated 27/2/13 in the amount of $1,848.00 and stated it was for repainting at 47 Formosa Road, Belmont, without any further details. Signature Painters say that they rectified all of their defective work and note that there was other rectification work which would have required repainting. Mt Cotton says that the rework by Rendcraft was only for the rectification of Signature Painters work. The Tribunal notes that the Jeffrey Hills report shows rectification work was required in respect of painting work which was outside of that stated by Signature Painters as the rectification work it was required to do, specifically in regard to painting of door hinges and the tops and bottoms of doors. Unfortunately there is insufficient detail in the Rendcraft invoice to determine which parts of it relate to rectification of work performed by Signature Painters. Therefore no amount will be allowed in respect of the work performed by Rendcraft.

    [6]Exhibit 15.

19. Mt Cotton also alleged that Signature Painters were performing building work during a period that they were not licensed to do so. This was during the period 13 September 2012 to 17 September 2012, while their licence was suspended for non–payment of renewal fees. Mr Morris in a statement[7] estimated that 90% of the work described in Signature Painters quotation and the purchase order occurred during this period. This showed 3 x painters on 14 September 2012 and 1 x painter on 17 September. The other days were on the weekend. The Tribunal notes that Signature Painters issued its first invoice on 19 September 2012 and does not accept that 90% of the work indicated on that invoice could have been performed as indicated in Mr Morris’s statement. As there is no way of calculating the value of any work which may have been performed while Signature painters was not licensed and having regard to the fact that s42 (4) of the Queensland Building Services Act 1991 (Qld) allows payment for labour and materials the Tribunal will not make any adjustment to the entitlement of Signature Painters on the basis of any work performed while there licence was suspended.

    [7]Exhibit 4.

20. Mt Cotton is also claiming the cost of the adjudicator in its claim. This is because it was ordered to pay those costs in the adjudicator’s decision made on 2 April 2013. It is clear that an adjudicator’s decision does not affect any right that a party has under the contract.[8] The requirement to pay the application fee is purely part of the process under the Payments Act and is not capable of being dealt with in this Tribunal as part of the Building Dispute.

    [8]Building and Construction Industry Payments Act 2004 (Qld) s 100.

21. As there has been no amount allowed to Mt Cotton as a result of the application the order of the Tribunal is that the application is dismissed.