O'Toole v M Johnson Building Pty Ltd
[2023] ACTSC 116
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
| Case Title: | O’Toole & Anor v M Johnson Building Pty Ltd |
| Citation: | [2023] ACTSC 116 |
| Hearing Date: | 27 April 2023 – 5 May 2023 |
| Decision Date: | 19 May 2023 |
| Before: | Balla AJ |
| See [231] | |
| Decision: | |
Catchwords: | CIVIL LAW – BUILDING AND CONSTRUCTION – Breach of Contract – defects in construction of residential building – failure to carry out works in accordance with plans – failure to carry out works with proper care and skill – failure to comply with requirements under the Building Act – Rectification of defects |
| granted | |
| Legislation Cited: | Building Act 2004 (ACT) ss 20, 36, 42, 88, 140 Building (General) Regulation 2008 (ACT) |
| Cases Cited: | Bellgrove v Eldridge [1954] HCA 36; (1954) 90 CLR 613 Brewarrina Shire Council v Beckhaus Civil Pty Ltd & Anor [2006] NSWCA 361 |
| Jones v Dunkel (1959) 101 CLR 298 Kirkby v Coote [2006] QCA 61 Stone v Chappel [2017] SASCFC 72; 128 SASR 165 at 172 | |
| Tabcorp Holdings Ltd v Bowen Investments Pty Ltd [2009] HCA | |
| 8; 236 CLR 272 The Owners Units Plan 1917 v Koundouris [2016] ACTSC 96; | |
| 307 FLR 372 | |
| Documents Cited: | ACT Government, Minimum Documentation Requirements for |
| Building Applications Lodgement Class 1 and 10 - Residential | |
| Construction (2 August 2016) | |
| Parties: | Kate Mary O’Toole (First Plaintiff) |
| Farooq Ahmed (Second Plaintiff) | |
| M Johnson Building Propriety Ltd (First Defendant) Capital Certifiers Pty Ltd (Second Defendant) | |
| Representation: | Counsel |
| M Robens (Plaintiffs) | |
| J Masters (First Defendant) | |
| Solicitors | |
| Harrington Hall Lawyers (Plaintiffs) | |
| O’Connor Harris & Co (First Defendant) | |
| File Number: | SC 386 of 2021 |
| BALLA AJ: | |
| Introduction | |
| 1․ | In 2018 Ms Kate Mary O'Toole and Mr Farooq Ahmed bought a block of vacant land at Latham in the ACT and decided that they wanted to build a house on it. |
| 2․ | They retained the first defendant, M. Johnson Building Pty Ltd (the builder), and the building work commenced in February 2019. The plaintiffs moved in on 7 June 2019. |
| 3․ | The plaintiffs say that there have been a number of breaches of the contract by the builder and claim damages. |
| 4․ | The builder disputes the plaintiffs’ claims. |
Causes of Action
| 5․ | On 6 November 2018 the plaintiffs entered into a written contract with the builder for the construction of a single-story residential dwelling. | |
| 6․ | The plaintiffs rely on the clauses in the contract which say the builder was required to: | |
|
in a proper and skilful manner;[1]
[1] clause 1(a)
(b) Complete the works to the standards of construction required by the Building Act 2004 (ACT) (the Act) and, if inconsistent with the contract, to the higher standard;[2]
[2] clause 1(b)
(c) Provide a warranty as to the accuracy and correctness of the construction plans;[3]
[3] clause 4(a)
(d) Obtain all planning and building approvals;[4]
[4] clause 7(a)
(e) Notify them of any variations in writing;[5] and
[5] clause 17(c)
(f) Rectify any defects and/or minor omissions within 15 days if it was notified during the 90 day maintenance liability period.[6]
[6] clause 27
7․ In addition, the plaintiffs say that the contract contained the following implied terms: (a) A term implied by the common law that the builder would carry out the works with all due care and skill. This is admitted by the builder.
(b) Terms implied by s 88 of the Act that the builder would:
(i) Carry out the works in accordance with the Act;
(ii) Carry out the works in a proper and skilful way;
(iii) Carry out the works in accordance with the approved plans; and
(iv) Use good and proper materials for the works.
These are admitted by the builder.
(c) That the documents lodged to achieve building approval would comply with the Building (General) Regulation 2008 (ACT) and the ACT Government's 'Minimum
Documentation Requirements for Building Applications Lodgement Class 1 and 10
- Residential Construction' so that the plans would have included additional details
which are fully set out in the Amended Statement of Claim.[7] The builder does not
[7] Paragraph 7(c)admit this pleading and says that this is a statutory process which is not implied into
the contract.
Evidence
| 8․ | The plaintiffs and the director of the first defendant, Mr Michael Johnson, gave evidence. | |
| 9․ | Evidence was also given by people involved in the design and construction of the house: | |
| (a) Mr Greg Blundell is the earthmover who excavated the site cut. | ||
|
on 3 November 2017 before the house was built and surveyed the property again
on 22 July 2020, 19 May 2021 and 4 August 2021.
(c) Mr Hugh Forbes Gordon is an architect and produced the architectural drawings for the house.
(d) Mr Scott Robert Bland is a structural engineer, a principal of Northrop Consulting Engineers and was responsible for the engineering drawings for the house.
(e) Mr Michael Jones is a geotechnical engineer at Douglas Partners. He prepared a report in 2018, that is before the house was built, at the request of the plaintiffs. He
later provided two expert reports at the request of the plaintiffs’ solicitor.
| 10․ | A number of experts were qualified by the parties and they gave evidence. These included experts retained by the second defendant, the certifier, which was no longer an active party at the hearing: | |
|
plaintiffs.
(b) Mr Mal Wilson is a structural engineer who was retained by the solicitor for the plaintiffs.
(c) Mr Arend de Waal is a quantity surveyor who was retained by the solicitor for the plaintiffs.
(d) Mr Chris Buchanan is a structural engineer who was retained by the solicitor for the first defendant.
(e) Mr John McFarlane is a geotechnical engineer who was retained by the solicitor for the second defendant.[8]
[8] Transcript p 227
| 11․ | Mr James Osenton is a quantity surveyor who was retained by the solicitor for the second defendant. His report was in evidence but he was not cross examined. Before the hearing commenced, he had prepared a schedule with Mr de Waal in which they agreed on various building costs. |
| 12․ | Mr Wilson, Mr Buchanan and Mr McFarlane prepared separate reports and then participated in a conclave before the hearing and produced a joint report (the joint report). They gave evidence concurrently. |
Background
| 13․ | The house was constructed on a sloping block, with the rear of the property higher than the front. There was a 600mm high retaining wall near the rear boundary. There were houses on either side of the block. |
| 14․ | The contract provided for the builder to build the house using its patented construction method, which operated under the name Precast Homes. |
| 15․ | Mr Bland’s predecessor at Northrop was involved in the development of the engineering |
| designs for the patented construction method. Mr Bland took over in about 2018. | |
| 16․ | In the case of the plaintiffs’ house, the construction started with the bulk excavation of |
| the site by reference to surveyor’s offset pegs. The excavation stopped 400mm short | |
| of the existing retaining wall. |
Excavation as at 22 February 2019
| 17․ | The location of the footings had been marked on the site plan around the perimeter edge of the building footprint. These were then excavated to 400mm. |
| 18․ | PF1 pad footings were placed onto the ground at the bottom of each footing excavation. Concrete and reinforcing were poured over the PF1 pad footings. |
| 19․ | The builder had retained a contractor to make the precast concrete wall panels. Those panels were placed around the perimeter of the building footprint to form the outside walls of the building. Each vertical join between the panels was situated directly over a PF1 pad footing. |
| 20․ | The roof trusses were attached to the top of the precast wall panels. |
| 21․ | Work then started on the waffle concrete slab which sat on the ground and would form the floor of the house. PF2 footings were placed on the ground. The drawings did not indicate where they should be placed and there is no evidence as to where they were placed. Square polystyrene pods were then placed on the ground. A channel was left between each pod so that when the concrete was poured it would be confined to that channel (the ribs) and the area occupied by the pods would become a void. The use of the polystyrene pods was designed to reduce the amount of concrete needed. Mr Wilson has advised that a PF2 footing placed under a rib acted to support the slab, but a PF2 footing under a pod did not support the slab at all. Reinforcing mesh was then placed on top of all of the area out to the edge. |
| 22․ | The wall panels were to be tied to the floor slab by ferrules and dowels. The ferrule, which is a metal element designed to take a threaded dowel, was embedded into the precast concrete by the manufacturer of the wall panel. After the wall panels had been erected, the plans provided for one end of a metal dowel to be threaded into the ferrule and the other end to project into the ribs of the waffle slab. Whether this was done in accordance with the contract is one of the issues in these proceedings. |
| 23․ | The concrete for the slab was then pumped into place. It flowed around and between and over the polystyrene pods. Around the perimeter of the building and inside the precast walls the concrete was formed into an edge beam which was a wider area of concrete. The plans provided for the concrete to be poured until it was 30mm above the reinforcing mesh. |
Outline of the plaintiffs’ claims
| 24․ | In summary, the plaintiffs say in their Amended Statement of Claim that, in breach of the express and implied terms of the contract, the builder failed to: | |
| (a) Ensure the concrete floor slab design was appropriate for the site; | ||
| (b) Build the concrete floor slab in accordance with the plans; | ||
| (c) Build the garage so its floor was 100mm lower than the floor of the house; | ||
|
1m high which are too close to the house, which impede access and are unsafe;
(e) Build the concrete slab to the correct height in the wet areas so those rooms have insufficient or no fall to each drain;
(f) Build the driveway in accordance with the plans and it is too steep, too narrow, too short and unsafe; and
(g) Construct the concrete porch in accordance with the plans.
| 25․ | The plaintiffs also claim that a number of other issues, which have been described as minor defects, are breaches of the contract. |
| 26․ | The plaintiffs also claim damages for loss of amenity and the cost of obtaining a new development approval (as it has lapsed) and a certificate of occupancy. |
Onus
| 27․ | Counsel for the plaintiffs submitted that the onus is on the plaintiffs to prove the builder breached a provision in the contract after which the evidentiary onus moves to the builder to prove that despite those matters, the plaintiffs have not suffered any damage.[9] |
| 28․ | Counsel for the builder did not make any submission to the contrary. |
| 29․ | I accept the submission. |
The plaintiffs’ claims
Site Classification and Slab
| 30․ | The technical requirements for the base of a building are informed by the properties of the surface on which it is placed. This is determined by site classification. Australian Standard (AS) AS2870 provides guidance on the patterns and magnitude of moisture related seasonal ground movements identified by that site classification that must be considered in the design of a dwelling.[10] |
| 31․ | In 2018, Ms O'Toole, at the request of the builder, retained Mr Jones, a geotechnical engineer, to conduct testing to determine the site classification before the house was built. |
| 32․ | Mr Jones classified the site as Class P (problem site) due to the presence of uncontrolled filling behind the retaining wall at the rear of the property and large trees. Notwithstanding that classification, based on a number of other factors, the worst case natural soil profile was assessed as equivalent to Class M (moderately reactive). In his Comments he said: |
[10] Expert Reports Bundle (‘Exhibit C’) p 123
All footings should found within a uniform bearing stratum of suitable strength/material. It is recommended that footing excavations be inspected by a geotechnical engineer.
| 33․ | Mr Jones recommended that piers to weathered rock be considered as the appropriate footing system as it would minimise shrink/swell movements and settlement of the footings.[11] |
| 34․ | In their joint report the experts agreed with Mr Jones’ site classification.[12] |
| 35․ | Mr Bland’s office, Northrop, was retained to produce the engineering drawings for the |
| plaintiffs’ house but they were not given Mr Jones’ report. Mr Johnson did not | |
| satisfactorily explain why that had occurred. Mr Bland could not recall whether he was | |
| the designing engineer for the plaintiffs’ house. Northrop assessed the site as Class M | |
| and designed the slab and footings accordingly.[13] This is noted on Drawing No S01. Separate notes on that drawing say: |
[11] Ibid
[12] Ibid p 670
[13] Affidavit of Mr Bland dated 20 December 2021 paragraph 33
F3 a suitably qualified geotechnical engineer to be contacted during excavation to confirm the site classification
and
WP1 Obtain Northrop's written instruction at …preparation of founding material, including
pier bore holes.
| 36․ | The site was not reassessed by a geotechnical engineer during excavation (or at all) nor were Northrop's written instructions obtained at the time the pier holes were bored. |
| 37․ | Mr Johnson said in cross examination: [14] |
[14] Transcript p 333 15 Exhibit C p 161 16 Ibid p 160-168
Do you accept from me that the plans required you as the builder to have a geotechnical
engineer attend during the excavation to confirm the site classification?---No. No, I – no.
No, we were down to pretty much rock, so, no, I didn't – don’t agree with that.Do you agree with me if I say that the engineering notes required a hold point at the time of the excavation of the footings for a structural engineer to send? ---They could say that.
Do you know?---No, I don't know. No.
You didn't organise a geotechnical attendance after the excavation of the footings, did you?-
--No.And that’s what you just explained. You thought it was hard enough so you proceeded with
the next stage of the construction?---Correct, yes….
In no position of any of the pad footings did you drill down to install piers to rock, did you?---
No.
| 38․ | I accept the submission made by counsel for the plaintiffs that the builder breached the contract by proceeding without the engineering advice. Mr Johnson made the decision to proceed based on his own assessment of the site in breach of the contract. |
| 39․ | Mr Johnson’s decision denied the plaintiffs the opportunity to have the slab and footing |
| design engineered to respond to what had been exposed by the excavation. | |
| 40․ | Further testing by Mr Jones in 2022, after the house had been built, established that the PF1 pad footings under the concrete floor slab had not been founded on uniform material, but had been founded on soil being a mixture of sand and clay at the front of the house and weathered rock at the back.15 |
| 41․ | The contract says the builder must comply with the standards of construction set out in the Act. |
| 42․ | The effect of s 42 of the Act is that the builder must comply with the standards of construction under the National Code of Australia (NCA) and the Building Code of Australia (BCA). As agreed in the joint report, the relevant standards are AS2870 and AS3600. |
| 43․ | Section 3.1.7 of AS2870 applies to designs when the footings are partially on rock and partially on soil, as in this case. It says provision for movement at the change between the two types of foundation shall be made by articulation of the superstructure or strengthening of the footing system. On a Class M site, the design shall be in accordance with engineering principles. |
| 44․ | Section 3 of AS2870 applies to standard designs. Counsel for the plaintiffs submitted |
| and counsel for the builder did not dispute, that the builder’s design did not comply with | |
| any of the standard designs because of its unique patented building method. This | |
| means that s 4 applies. Section 4 is headed “Design by engineering principles”. Section | |
| 4.1 provides that slabs or footing systems designed in accordance with engineering principles must also comply with AS3600. | |
| 45․ | I accept the submission made by counsel for the plaintiffs that the builder cannot have complied with the requirement to comply with the engineering design principles in AS2870 and AS3600 where the engineers did not attend and view the excavated footings and there is no evidence of an engineered design, or the application of engineering principles, that would satisfy s 4. |
| 46․ | I take into account that each of the engineers agreed that they would defer to the opinion of Mr Jones as he is a local geotechnical engineer with the most experience. Mr Buchanan has not practised as a geotechnical engineer. Mr McFarlane has extensive experience as a geotechnical engineer, but no experience relevant to the soil in the ACT. Mr Bland is a structural engineer and he refers matters to geotechnical experts as required. |
| 47․ | Mr Jones16 said it is best practice from a geotechnical perspective to found a structure on similar material to control settlements and shrink/swell movements from changes in soil moisture content. Alternatively, a structural engineer can design another approach which would be supported by calculations. |
| 48․ | Mr Jones said that his advice would have been (at the time of construction) to utilise a Class M type footing system and pier to rock those sections of the footings that did not bear directly on weathered rock.[17] |
| 49․ | I accept this evidence and find that it is likely that if the builder had complied with the contract and sought engineering advice, the footing system would have been piered to rock. |
| 50․ | I accept that this is a further breach of the contract by the builder and the evidentiary onus is on the builder to prove that what has been built will perform satisfactorily. |
| 51․ | Mr Buchanan and Mr McFarlane think that the slab will perform satisfactorily because it is a Class M slab and Mr Buchanan could not see any evidence of movement when he viewed the site. This observation is contradicted by the evidence from Mr Wilson who provided a photograph of a gap in the garage eaves which he said is evidence of some movement at this corner and did not bode well for the footing performance during a period of dry weather.[18] |
| 52․ | I accept that the evidence establishes that settlement and shrink/swell movements from changes in the soil moisture content cause a slab to move. Changes in soil moisture content are primarily caused by the weather. In this case the poor drainage around the slab has also resulted in water pooling against the slab. The weather records in evidence show that there has been above average rain for many of the months since the house was built. In the joint report all the experts agreed that it is unlikely that the slab and house has experienced the full range of potential moisture induced movement over the life of the house which is 50 years.[19] |
| 53․ | Mr Wilson[20] said that in very dry times when the soil under the periphery of the building will be prone to shrinkage, there is a significant prospect that the waffle slab will be required to cantilever 2m or more to support the weight of the precast and roof it supports at the front of the building. His calculations suggested that the slab reinforcement would be insufficient to cope with the bending were this to occur. Mr Wilson has identified a risk of cracking to internal walls in 10 to 20 years as a consequence of the movement. |
| 54․ | I am satisfied that the evidence establishes that, when there will be a dry period in the future which affects the soil around the footings, there will be shrinkage of the soil which is likely to affect the slab. This means there is a risk of cracking to the internal walls. |
| 55․ | I decline to find that the builder has discharged the evidentiary onus to show that what was built will perform satisfactorily. |
| 56․ | I have considered the issue of damages later in these Reasons. |
[17] Ibid p 161, paragraph 15
[18] Ibid p 253-254
[19] Ibid p 674
Dowels connecting walls to slab
| 57․ | Mr Bland, who has been involved as an engineer in the design of the patented construction method used by the builder, said the dowels and ferrules take on the important role of tying the slab to the walls.[21] |
| 58․ | Mr McFarlane said he did not think that the dowels served a structural purpose and described them as a nominal connection.[22] |
| 59․ | Mr Buchanan said it was the first house he had seen of this construction type.[23] He also said that the dowels were nominal and added that it was perfectly acceptable for the wall panels to be separated from the slab.[24] |
| 60․ | I prefer the evidence of Mr Bland who has extensive experience with the builder’s |
| patented system of construction. | |
| 61․ | Two issues with the dowels have been identified – were the correct ferrules and dowels |
| used and were the ferrules and dowels spaced correctly. | |
| 62․ | The plaintiffs became aware of these issues because the certifier took a photograph of the slab before the concrete was poured on 14 March 2019. |
| 63․ | Engineering plan S05 prepared by Northrop specified M20 ferrules cast into the walls to join N20 dowels which were 300mm long and spaced at 600 centres. |
| 64․ | In relation to the size of ferrule used, the later shop drawings, which Mr Wilson says “appear to have been produced out of Northrop’s office”,[25] show M16 ferrules. Mr |
| Johnson said in cross examination that the plans and designs sent to the precast wall manufacturer required it to install M20 ferrules. | |
| 65․ | In relation to the size of dowel used, Mr Johnson said the builder used N20 dowels but they came off the shelf at 600mm long. They were supposed to be chopped down to 300mm but as they went over the waffle slab they left them at 600 mm. |
| 66․ | In relation to the spacing of the dowels, the later shop drawings show them at 1153mm spacings rather than the 600mm on the engineering plan. Mr Johnson said he did not know where the 600mm spacing had come from.[26] Mr Bland said he recalled a conversation on a job a few years ago about whether a spacing change could occur. He could not recall whether he went away and crunched some numbers or whether he had asked a colleague to do it. He said he had a small office, his records are not optimum and if he had retained the calculations he would have produced them.[27] |
| 67․ | Mr Wilson has concluded that the dowels on the certifier’s photograph were spaced |
| about 2.2m apart. Mr Buchanan and Mr McFarlane say a conclusion cannot be reached from a single photograph but agree that the spacing in the photograph exceeds the spacing shown on the shop drawings.[28] | |
| 68․ | Mr Johnson did not say he had complied with the spacings shown on the shop drawing. He said: |
[22] Ibid p 138
[23] Ibid p 147
[24] Ibid p 168
[25] Exhibit C p 527
[26] Transcript p 334
[27] Ibid p 283-284
[28] Exhibit C p 683 29 Transcript p 334
The dowels were not installed into the walls at 600 millimetre spacings, were they?---No,
there's a – I’m not sure where the centres or spacing, 600 mil, have come from. I don't
understand that at all. Drawings, the panel drawings show on the 1130 on an average, some are closer, some are a little bit further like the garage wall, but I don't understand where the 600 centres for these dowels has ever come from to be honest.29
| 69․ | I am satisfied that the plaintiffs have shown that the builder breached the contract by spacing the ferrule/dowels too far apart in at least one area and using dowels which were too long. | |
| 70․ | In relation to the consequences flowing from this finding, I do not accept the opinions of Mr Buchanan and Mr McFarlane where they conflict with other expert evidence because of their misunderstanding as to the role of the ferrule/dowel in the structure of the building. | |
| 71․ | I accept the submission made by counsel for the plaintiffs that following evidence has not been provided regarding: | |
|
engaged to manufacture the wall panels or documentary evidence;
(b) How many dowels were installed in the slab. Mr Wilson has questioned the appropriateness of the placement of some of the dowels in the shop drawings and
these issues have not been clarified;[30] and
[30] Exhibit C p 522
(c) How the dowels were connected to the ferrules in the walls, the extent of the concrete coverage and details of the waterproofing of the slab from the
subcontractor who did the work.
| 72․ | I draw a Jones v Dunkel[31] inference from the failure to call this evidence, without satisfactory explanation, that the evidence would not have assisted the builder to show: | |
| (a) Compliance with the plans; and | ||
| (b) The absence of dowels will not result in poor performance. | ||
| 73․ | I accept the evidence of Mr Wilson who has performed calculations. He is of the opinion | |
| that dowels are prone to brittle failure – that is they will not bend when the concrete | ||
| shrinks. When the load exceeds the capacity of the ferrule, the ferrule will pull a cone, which means it pulls a cone-shaped piece of concrete out of the concrete causing the disconnection of the wall from the slab. His expectation is that most of the dowels will have pulled cones. | ||
| 74․ | Counsel for the builder asked me not to accept the opinion of Mr Wilson because: | |
|
[31] (1959) 101 CLR 298 32 Transcript p 165, 171
concrete has now been poured and the ferrules and dowels cannot be seen,
however Mr Wilson has had the benefit of the plans, the certifier’s photograph and
his calculations.
(b) He based his conclusion on the further assumption of calculations which did not relate to the site. I am satisfied that Mr Wilson undertook calculations in which he
explained all of the assumptions that he had made.
| 75․ | In the joint report the experts agreed that there will not be any structural consequences if there is a shortfall in the strength of the dowel connections. They also agree that a short fall in the strength of the dowel connections may cause small relative movements of up to a few millimetres at the top on the junction with the ceiling. I accept this evidence. |
| 76․ | In addition, because the dowels are too long, they extend out past the edge beam and |
| into the area where the waffle pods start. Mr McFarlane agreed that the certifier’s | |
| photograph showed one of the dowels was over the top of the waffle pod and that a 300mm dowel would not have extended that far. This means that the tip of any of dowel which extends over a pod rather than sitting between the pods in the rib may not be properly covered in concrete.32 I accept the evidence of Mr Wilson, and Mr McFarlane who agreed it is possible that this could create a gap for the entry of moisture from condensation running down the wall if the concrete cover was only 20mm.[33] |
[33] Exhibit C p 200
Reinforcing cut
| 77․ | The photograph taken by the certifier also showed that the reinforcing in the edge beam had been cut around vertical plumbing pipes.[34] The offcuts of the reinforcing can be seen on the ground. |
| 78․ | Mr Wilson advised that AS2870 requires that waffle slabs be reinforced so that the strength of the footing in flexure exceeds its cracking moment. This is to ensure that when the beam cracks, the crack does not continue to widen but rather delivers loads to other areas. This prevents a sudden discontinuity or hinge at the crack which could lead to wall damage. It is therefore, in his opinion, critical to ensure that any reinforcing which has been cut to facilitate service pipes is fully reinstated. The failure to reinstate the cut reinforcement had compromised the strength and stiffness of the edge beam.[35] |
| 79․ | I accept this opinion. |
| 80․ | Mr Buchanan accepted that this was poor construction practice.[36] |
| 81․ | I find that the builder, by not reinstating the reinforcing, breached clauses l (a) and (b) of the contract and did not carry out the work in a proper and skilful way. |
[34] Ibid p 280
[35] Ibid p 285
[36] Transcript p 263 37 Exhibit C p 255
Tiling and the slab
| 82․ | There is tiling throughout the house except for the bedrooms, walk in robe, theatre and garage areas. |
| 83․ | AS2870 5.3.7 applies when floor tiles are used over an area greater than 16m2. In this case the tiles occupied 77 m2. This means that the builder should have taken one of |
| three steps – used a specified size of reinforcement, installed a specified bedding | |
| system or waited three months after pouring the concrete before installing the tiles. | |
| 84․ | None of those steps were taken. |
| 85․ | I find that the builder, by not complying with AS2870, has breached the contract. |
| 86․ | Mr Wilson has concluded that the slab has been in place long enough, and the tiles have not cracked so there will be no issue with non-performance from slab shrinkage.37 The joint expert report confirms each engineer's opinion that this is no longer an issue.[38] |
[38] Ibid p 676
Garage slab
| 87․ | The site plan drawn by the architect shows the finished height of the garage as 570900 and the finished height of the main part of the house as 571000, which means a drop down of 100mm from the house to the garage. [39] Ibid p 691 | |
| 88․ | The structural drawing does not show the set down to the garage. | |
| 89․ | It is common ground that the house was built without the set down. | |
| 90․ | The experts agree in the joint report that the architectural drawings take precedence and the garage floor should have been built with the set down.[39] | |
| 91․ | Mr Johnson relies on: | |
|
after the floor and walls had been completed and said the garage "looks lovely. I
like the way this area has turned out”. I am not persuaded that this conversation
(which is denied by Ms O'Toole) has any relevance to any matter to be determined
by me in circumstances where the garage floor had already been erected and any
variation to the contract had to be made in writing. [40]
[40] Exhibit KMO1 to the affidavit of Ms O'Toole dated 13 September 2022 p 10-11
(b) Evidence from Mr Gordon the architect. In his affidavit he said that, while he had, on the plans, set the garage floor 100mm below the floor of the rest of the house,
houses can be built with the garage on the same level and there is no practical
draw back to having the two areas on the same level.[41]
[41] Affidavit of Hugh Forbes Gordon dated 15 December 2021 paragraphs 28-31
(c) On cross examination Mr Gordon said he had based his design on the CAD design provided to him by Ms O’Toole. One of the reasons why the garage had been set
down in the plans was to achieve a gradient of approximately 17 per cent on the
driveway. In 2018 when he was drawing the plans he was not aware that the builder
wanted all slabs at the one level. The first time he was directed to do so by the
builder was by email dated 1 August 2020.[42]
[42] Transcript p 297-298I do not consider that this evidence conflicts with the plaintiffs’ case in relation to
the garage slab.
(d) Evidence from Mr Bland who said the architectural plans were ambiguous because the stepdown was only shown on the site plan page and there was a note on the
architectural plans that "engineering documentation takes precedence over
architectural structural sizings" and “Northrop Engineers always designed this type
of structure with one level”.[43] I prefer the opinion in the joint report.
[43] Affidavit of Scott Robert Bland dated 20 December 2021 paragraphs 10-11
| 92․ | I accept the opinion in the joint report and find the garage should have been built with the step down. |
| 93․ | Accordingly, I find that the plaintiffs have shown that the builder failed carry out the works in accordance with the approved plans in breach of the contract. |
Wet area floors
| 94․ | The experts did not agree on whether the plans required a set down for the wet areas being the ensuite, the bathroom and the laundry. |
| 95․ | The set down is not shown on the architectural drawings. |
| 96․ | Structural drawing S05 has a structural detail headed "Internal wet area set down" |
| being a diagram on which “50 set down max” is marked. | |
| 97․ | In the joint report, Mr Buchanan said a set down was not indicated for the wet areas because it was not on the architectural drawing. He did not refer to the structural drawing.[44] |
| 98․ | Mr McFarlane said that he did not consider S05 specified a set down. In his experience the detail only applied if the architectural drawings and structural plans specified a set down.[45] I note that, even if this is correct, clause 3 (b) of the contract provides that if there is any discrepancy or ambiguity, the builder was to serve the plaintiffs with a notice and ask for instructions.[46] |
| 99․ | I prefer the opinions of Mr Gray and Mr Wilson. They both say S05 clearly show a 50mm set-down for internal wet areas.[47] |
| 100․ | Mr Johnson agreed he had not set the slab at a lower level in the wet areas.[48] |
| 101․ | Accordingly, I find that the plaintiffs have shown that the builder failed to set-down the internal wet areas in accordance with the approved plans in breach of the contract. |
| 102․ | Next there is the issue of whether the wet areas have the requisite falls. The NCA and AS3740 apply to falls in bathrooms, showers and laundries, imposing a requirement for water to drain without ponding except for residual water remaining due to surface tension and requiring falls in the floor which ensure that the water exits at the floor wastes or the designed exit point. |
[44] Exhibit C p 669
[45] Ibid p 669
[46] Exhibit KMO1 to the affidavit of Ms O'Toole dated 13 September 2023
[47] Exhibit C p 669, 40
103․ Mr Gray confirmed that the required set-downs had not been built and found the
following:
(a) The fall to the floor waste in the laundry was approximately 5mm over a 1.2m span and at 1:100 it should have been 12mm.
(b) The fall in the bathroom tiles was approximately 8mm over a 1.2m span and at 1:100 gradient it should also have been 12mm.[49]
[49] Exhibit C p 40
| 104․ | Mr Wilson said that both the falls in the bathroom and the laundry were very close to flat and there was not much prospect of that arrangement confining a major flooding event to the bathroom and no prospect of that arrangement confining a major flooding event to the laundry.[50] |
[50] Ibid p 189-190
105․ There is a video in evidence of the ensuite shower which I accept shows it is not compliant because it does not allow the water to fall to the drain under normal use. It escapes over the water seal bar on the floor, and out onto the main part of the ensuite floor. It is the evidence of Ms O'Toole that when the water escapes from the shower cubicle it floods the floor and carpet of the adjoining walk in robe.[51] Water pools in the shower in the main bathroom causing it to become slimy very quickly 52.
[51] Affidavit of Ms O’Toole dated 19 August 2022 paragraph 152(c)
106․ Mr Johnson did not test the falls in the main bathroom, the laundry, or test to see whether the ensuite shower drained properly.[53]
[53] Transcript p 338
| 107․ | I find that the plaintiffs have shown that the builder failed to install falls to the wet areas to the standards of construction required by the NCA and AS in breach of the contract. |
108․ There is also an issue about whether the areas were waterproofed. Mr Johnson said that while he did not see the sub-contractor instal the waterproofing, he saw it just after it had been installed and then he went on a holiday. After being shown an email, he agreed he might have been away and was not 100 per cent sure whether he was there when it was done.[54] Mr Johnson signed the certificate which said that the wet areas complied with the standards.
[54] Ibid p 337-338 55 Exhibit C p 32
109․ I find there is no evidence to show that the waterproofing was done as required by
AS3740.
| 110․ | I find that the plaintiffs have shown that the builder failed to waterproof the wet area to the standards of construction required by the AS in breach of the contract. |
Inadequate site cut
| 111․ | This diagram prepared by Mr Stone shows the existing house in the centre surrounded by an area coloured green which depicts the additional excavation which has to be done, being 88m3, to comply with the approved design elevation plans which indicate a uniform batter across the rear yard of the property.55 |
| 112․ | The experts in the joint report agree that the site has not been excavated in accordance with the plans.[56] |
| 113․ | Mr Johnson agreed he had not excavated the site in accordance with the plans.[57] |
| 114․ | I am satisfied that the plaintiffs have shown that the builder has breached the contract because the excavation work was not carried out in accordance with the contract and was not done in a proper and skilful manner. |
[56] Ibid p 675
[57] Transcript p 325
Failed to provide site drainage
| 115․ | Engineering note RSG12 on plan SO1 says “the ground surrounding the slab shall have |
| its surface at least 150mm lower than the slab surface and be graded away from the | |
| slab edge to the site drainage system”. | |
| 116․ | The architect’s drawing DA06 provides that “grade sites to allow for surface drainage”. |
| 117․ | Mr Johnson agreed that he had not installed any drainage to take water away from the edge of the slab. He said he did not understand from the engineering notes and plans that the builder was required to ensure that the surface water drained away.[58] |
| 118․ | I am satisfied that the plaintiffs have shown that the builder has breached the contract because the builder was required to put in site drainage as set out in the plans. |
Driveway
119․ It is common ground that plans provided for a driveway from the garage to the point
where the property ended at the grass verge. The existing part of driveway crossing
the grass verge was to remain.
| 120․ | The size and shape of the driveway is depicted in grey on DA02: |
| 121․ | This photograph[59] shows how it was built: |
122․ The inclusions list in the contract provides an allowance for 50m2 of driveway, which
Mr Gray considered a reasonable estimate of the concrete which would have been needed if the builder had constructed the driveway in accordance with the plans. He calculated that 22m2 was used by the builder. Mr Gray has concluded that the driveway that has been built varies from the plans.[60]
[60] Exhibit C p 45
| 123․ | Mr Stone has concluded that the driveway rises from the road at an average grade of 14 per cent for the first 7m of old pavement that served the previous dwelling on the site. The new 5 metre portion of pavement to the garage rises at an average of 18 per cent with the lower portion of 3.72m rising at 20.9 per cent.[61] |
| 124․ | It is obvious that the builder has not constructed the driveway in accordance with the plans in breach of the contract. It is too steep, the wrong shape and too short. As counsel for the plaintiffs submitted when seen facing the house, the driveway should extend further to the right side of the garage opening and it should be square to the house on both sides, but instead it angles back in to become smaller as it extends towards the street. And, as Mr Wilson said, it should be longer.[62] |
| 125․ | I am satisfied that the plaintiffs have shown that the builder has breached the contract because the driveway was not constructed as set out in the plans. |
[61] Ibid p 9
[62] Ibid p 191
Porch
| 126․ | Because the garage slab is 100mm higher than shown on the plans, it is necessary to take a step down from the driveway to the porch. This has changed the access to the house from the driveway. |
| 127․ | I am satisfied that the plaintiffs have shown that the builder has breached the contract because it changed the method of access from the driveway to the porch set out in the plans. |
Garage door
| 128․ | Ms O'Toole said there is significant gap at the top of the garage door allowing insects and spiders to enter. It also means the garage becomes very cold over winter. If the door has to be opened manually, it hangs down too much, so another person has to hold it open while the car is driven out of the garage and then will not close.[63] |
| 129․ | Mr Gray sought an opinion from Mr Hadley of MH Doors Canberra, who inspected the site on 18 May 2021. Mr Hadley advised that the door had not been installed properly.[64] |
| 130․ | There is no other evidence in relation to the garage door. |
[63] Affidavit of Ms O'Toole dated 19 August 2022 paragraph 152f()
[64] Exhibit C p 78
131․ I am satisfied this is a breach of the builder’s contractual obligation to carry out the works in a proper and skilful manner.
Tiling expansion joints
| 132․ | In paragraph 19 of his affidavit Verifying his Answer to the Plaintiff’s Interrogatories Mr |
| Johnson said:[65] |
[65] First Defendant’s Answers to Interrogatories dated 4 May 2021 paragraph 19
19. Look at paragraph 26(g) of the SOC and state:
a. Were expansion joints required to be installed in the floor tiling? Yes.
b. Were expansion joints installed in the floor tiling? No.
| 133․ | When Mr Johnson was asked whether any expansion joints had been installed in any |
| part of the tiling, he replied “I’m not sure, I don’t think so”.[66] |
[66] Transcript p 348
134․ I am satisfied this is a breach of the builder’s contractual obligation to carry out the
works in a proper and skilful manner.
Termite management system
135․ Mr Gordon’s plan DA06 states: “TERMITE PROTECTION TO COMPLY WITH AS
3660”.
| 136․ | Mr Johnson said in cross examination he had signed the termite certificate even though he is not qualified to do so. He believes the treatment is not needed because the timber doors have been treated with a clear seal on the top and bottom and painted on the other areas. He later agreed he had not seen the carpenter sub-contractor putting a clear seal on the doors.[67] |
| 137․ | I infer from this evidence that a termite management system was not installed in breach of the contract. |
[67] Ibid p 348-349
Stormwater lines
| 138․ | AS3500.3 provides that the storm water lines should have been backfilled to a minimum of 100mm below the finished ground. |
| 139․ | It is obvious from photographs in evidence and the report of Mr Gray that this has not occurred. [68] |
| 140․ | I find that the storm water lines were not backfilled in breach of the contract. |
Tiling and sealing
141․ Part 3.8.1 of the BCA provides that walls adjoining a laundry tub should have tiling extending 50mm up the wall on all sides of the vessel.
| 142․ | There is a photograph in evidence showing that the area between the window and the laundry tub has not been tiled in breach of the BCA. |
143․ There is a photograph in evidence showing that the wall on one side of the ensuite vanity has not been tiled in breach of the BCA.
| 144․ | That photograph also shows that the ensuite vanity has not been sealed up against that wall as required by the BCA. |
145․ I find that the tiling and sealing required by the BCA in these areas was not done, in breach of the contract.
Failed to seal linen cabinet in laundry
| 146․ | A claim is made for the rectification of a gap around the laundry cupboards. |
| 147․ | However, the part of the NCC Guide referred to,[69] applies to junctions between bench tops and adjoining surfaces. It was not explained how this applied. |
| 148․ | I decline to find that the plaintiffs have established this part of their claim. |
Doors
| 149․ | Ms O'Toole said in her affidavit that the internal doors did not appear to be sealed at the top and bottom and the laundry door has already started to show signs of water damage.[70] Photographs taken by her are in evidence. She was not cross examined in relation to this issue. |
| 150․ | Mr Jones said he did not see the carpenter putting a clear seal on the doors. |
| 151․ | I accept the evidence of Ms O'Toole and find that the clear seal was not applied. |
[70] Affidavit of Ms O’Toole dated 19 August 2022 paragraph152(g)
152․ Mr Gray has advised, and I accept, that applying the seal is a requirement under the door manufacturer's conditions of sale.[71]
[71] Exhibit C p 62
153․ I am satisfied this is a breach of the builder’s contractual obligation to carry out the
works in a proper and skilful manner.
Failed to correctly paint and remove packing materials
154․ The plaintiffs say that the builder did not correctly paint and remove the packing materials around the ensuite and main bathroom vanity mirrors.
155․ There is a photograph in evidence showing that the cardboard packing under the bathroom mirror has not been removed. It also shows that the paint on the mirror edges is patchy. Mr Gray said, and I accept, that the top of the splashback wall tiles have not been painted to match the wall tiles and/or wall colour.[72]
[72] Ibid p 63 73 Ibid p 65
156․ I am satisfied this is a breach of the builder’s contractual obligation to carry out the
works in a proper and skilful manner.
Hinges
| 157․ | BCA Part 3.8.3.3(c) provides that an entry door to a bathroom must be removable by means of lift-off hinges from the outside of the door. I accept the evidence of Mr Gray and find that lift-off hinges were not installed. Mr Gray described this as a high priority, safety issue.73 |
158․ I am satisfied this is a breach of the builder’s contractual obligation to carry out the
works in a proper and skilful manner.
Plastering and painting defects throughout the house
159․ Mr Gray observed run marks, brush strokes, overpainting and unfilled depressions in the paint in some areas. He concluded that the overall painting generally complied with the minimum standard but included photographs in his report which he said showed the more obvious defective areas.
160․ I accept this evidence and am satisfied this is a breach of the builder’s contractual
obligation to carry out the works in a proper and skilful manner.
Damages
Legal principles
161․ The quantity surveyors have agreed that the cost of demolition and rebuilding in
accordance with the plans would be $621,449.70 less $26,809.43 if the precast panels
can be reused.
162․ While counsel for the plaintiffs submitted that this course would be the only way to ensure that the plaintiffs were delivered a product which conforms with the contract, he conceded that the amount awarded needs to be reasonable, and made an alternative claim based on evidence of the cost of rectification of the various defects.
| 163․ | The following cases set out the applicable legal principles. |
164․ In The Owners Units Plan 1917 v Koundouris,[74] Mossop J at 457–458; [487]
[74] [2016] ACTSC 96; 307 FLR 372
summarised the principles derived from the decision of the High Court in Bellgrove v
Eldridge[75] and subsequent cases as follows:
[75] [1954] HCA 36; (1954) 90 CLR 613487. The cases stand for the following propositions:
(a) The primary remedy is rectification so as to produce contractual conformity: Bellgrove [at]
618;
(b) That is qualified by the requirement that the work undertaken to achieve conformity must
be a reasonable course to adopt: Bellgrove at 618;
(c) Providing only the cost of a “doubtful remedy” would not adequately compensate a
claimant, because it could not in any sense be regarded as ensuring that the claimant received the equivalent of a substantial performance of the contractual obligations: Bellgrove at 620;
(d) Because damages are assessed on a once and for all basis, the law must be astute to ensure that the measure of damages accurately reflects the restoration of the claimant to the position they would have been in had the defendant not failed in its duty: Kirkby at [59] [Kirkby v Coote [2006] QCA 61].
| 165․ | In Tabcorp Holdings Ltd v Bowen Investments Pty Ltd,[76] the High Court accepted that |
| “the test of ‘unreasonableness is only to be satisfied by fairly exceptional | |
| circumstances.” | |
| 166․ | In Stone v Chappel,[77] Doyle J observed: |
[77] [2017] SASCFC 72; 128 SASR 165 at 172; [13]
True it is that the cost of rectification after the event may be much more than the cost of providing the stipulated benefit at the time, but if wrongdoers were to think that, for that very reason, they will escape the full cost of providing the stipulated benefit, the efficacy of contractual instruments would be undermined. That deleterious effect extends beyond the consequences to the innocent party to the particular contract in question. In many circumstances a wrongdoer will have won the contract at the expense of another supplier in the market place who may well have stipulated a higher price precisely because he or she wished to ensure delivery of the contractual promise in full. Of course I am speaking generally and I do not suggest that in this case the respondents never intended to fulfil their contractual obligations.
The footings
167․ Mr Wilson is of the view that piering to rock will minimise the potential for differential settlement and has prepared a diagram setting out where the work should be done.[78]
[78] Exhibit C p 702
| 168․ | Mr De Waal has estimated the cost of this underpinning as $14,747. |
169․ Counsel for the builder submitted that the cost was not necessary as the building is
structurally sound. In addition, he said that the expenditure is out of proportion to the
benefit to be obtained.
170․ I am not persuaded that the plaintiffs are only entitled to rectification for structural defects. I have made findings as to the likely consequences which flow from this contractual breach and am not persuaded that the expenditure is out of proportion to the benefit to be obtained.
| 171․ | Mr de Waal’s estimate was based on the assumption that the depth to rock is 1 metre. |
| In cross examination Mr de Waal was asked to calculate how much it would cost if the excavation was done to only 800mm. He concluded it would be $11,894. | |
| 172․ | When preparing his report Mr de Waal had been provided with Mr Wilson’s report dated |
| 26 April 2023. Mr de Waal said in his report: |
due to the nature of the underpinning the holes for the piers will be at least 500mm wide (left to right) and at least 1000mm long (500mm under the slab and around 500mm outside the face of the building to allow digging access). This is conceivably the smallest dimension that these holes could be.[79]
[79] Ibid p 721 80 Ibid p 701
| 173․ | Counsel for the builder has not explained to me why the depth should be reduced. |
| 174․ | I am satisfied that the cost of rectification is a reasonable course to adopt and I allow the amount claimed. |
Dowels
| 175․ | Mr Wilson has recommended inserting stainless steel anchors around the perimeter of the building to ensure there are no problems with the footing and wall separating in the future.80 | |
| 176․ | Mr De Waal has estimated the cost of installing these anchors as $12,831. | |
| 177․ | Counsel for the builder submitted that no allowance should be made because: | |
|
have failed. I have already found that I do not accept the evidence of these
witnesses in relation to the dowels.
(b) The building is structurally sound and requires no further work. As I have already said, I am not persuaded that the plaintiffs are only entitled to rectification for
structural defect.
(c) The plaintiffs have been living in the residence for almost four years. I do not consider that this is relevant to the determination of this issue.
(d) The cost of reinstatement is not the appropriate measure of damages if the expenditure would be out of all proportion to the benefit to be obtained. I have made
a finding as to the likely consequences which flow from this contractual breach and
am not persuaded that the expenditure is out of proportion to the benefit to be
obtained.
| 178․ | I am satisfied that the cost of rectification is a reasonable course to adopt and I allow the amount claimed. |
Reinforcing cut
179․ The cost of rectification of this issue is included in the cost of rectification of the wet
areas.
Tiling and the slab
180․ No rectification is sought.
Garage slab
181․ I find:
(a) The slab has been raised but the garage opening height and the internal ceiling height have remained the same;
(b) The finished height of the driveway is 100mm higher so that the entry to the garage is a at a steeper angle;
(c) A video in evidence shows that a car using the right hand side of the garage (from the street has a difficult turn to make when reversing out of the garage and the
bottom of the car barely clears the slab. I accept the evidence of Ms O'Toole who
says they have damaged the wall of the garage and the side mirror;[81] and
[81] Affidavit of Ms O’Toole dated 19 August 2022 paragraph152(c)
(d) The amenity of the house is reduced with no set down to stop dust, debris and water from entering the house through the garage.
| 182․ | Counsel for the plaintiffs submitted and counsel for the builder did not dispute that this deviation from the approved plans prohibits the Certificate of Occupancy being issued in the absence of rectification or an agreed amendment to the plans. |
183․ Counsel for the builder submitted that the extra height makes no material difference, Ms O'Toole was initially very happy with how it looked, the step down to the porch is not a great inconvenience and the dirt and dust coming into the house could be stopped with a seal.
| 184․ | Mr Wilson has advised that, for the garage to be set down, it would require the whole waffle slab to be set down to maintain the stiffness of the foundation system. This would require the demolition of the whole garage slab including ribs for its full depth and the removal of 100mm of soil before reconstructing the slab. The new ribs would need to be dowelled to the existing with full bar laps and the plastic membrane would need to be protected and retaped. The deepening of the waffle slab will also conflict with the pads that support the precast and these would need to have 100mm removed.[82] |
[82] Exhibit C p 191
185․ The quantity surveyors have agreed that the price to rectify the garage height is
$31,843.76.[83]
[83] Plaintiff’s overall costing summary with escalation
186․ I take into account the submissions made by counsel for the builder. Nevertheless, I accept that this issue causes ongoing and frequent interference with the plaintiffs’
activities. The reduced ceiling height and the difficulties with entry would not be occurring if the contract had been performed. I am satisfied that the cost of rectification is a reasonable course to adopt and I allow the amount claimed.
Wet area floors
| 187․ | The quantity surveyors have agreed that the cost of rectification in accordance with the advice of Mr Wilson is $54,584.00.[84] | |
| 188․ | Counsel for the builder submitted that no allowance should be made because: | |
|
[84] Ibid 85 Ibid 86 Transcript p 324
she did say this, it is clear from her evidence that since then she has used the taps
and is unhappy with the drainage in those room.
(b) The tiler, Paul Klatt, never raised any issues with the discrepancies in relation to the tiling, levels of the floor or fall in the tiling. However, the tiler did not give
evidence.
(c) There is no requirement in the wet areas for there to be a fall in tiled areas which have a water-bar at the doorway and in which the wall/floor junction is "wet-sealed".
I accept the submission made by counsel for the plaintiffs that AS3740 provides
that the falls in the shower floors should be sufficient to prevent the water from
discharging outside of the shower area.
| 189․ | I am satisfied that the cost of rectification is a reasonable course to adopt and I allow the amount claimed. |
Inadequate site cut
190․ The cost to remove the 88m3 identified by Mr Stone as not having been removed is
$95,746.57.85
| 191․ | Counsel for the builder said the cost should not be allowed because landscaping was not included in the contract. It may be that, after the site has been excavated to the state it should have been pursuant to and included in the contract, some landscaping will need to be done. The claim is for the work the builder did not do which it should have done. |
192․ In considering whether the amount is reasonable, I take into account that the site is
unsafe.
| 193․ | Mr Johnson agreed that at one point, the excavation of the cut is about a metre and a half down from the gutters. In a horizontal orientation you would be able to touch it if you reached up. He agreed as the builder he was required to leave the site cut in a safe way. |
194․ Mr Gray said:
The site cut to both sides and the rear of the residence is finished too close to the residence resulting in several bad building practices. Firstly, as completed, the site cut has not been battered back to 1:1 (45 degrees), unless otherwise designed by a geotechnical or civil engineer and will, over time, erode and collapse back towards the residence.
| 195․ | Mr Jones said “The current site excavation is considered to be a safety hazard due its |
| height and near-vertical formation.” |
196․ Mr Wilson said:
From a safety perspective there are two major concerns that need to be addressed the first is that the builder has left an escapement up to 2.4 m high with no barrier at the top which causes a fall from heights safety concern. A builder cannot leave the site in a situation that is dangerous to the occupants and their guests. NCC P2.5.2 a) ii) for example require a balustrade for fall protection for any built element that is more than 1 metre above the ground and this situation is no different. The retaining wall which was a built element is now well over 2m above the ground. While a retaining wall that is not a delineated path falls outside the scope of the NCC the risk to safety is no less real so the problem should be well understood by the builder and the certifier.
The even more obvious problem here is that you cannot leave a 2.3 to 2.4 high near vertical soil embankment and not expect that it will collapse at some point in the future. To have such an embankment in the yard presents a clear and present danger to the owners and their children as it is almost certain to collapse at some point in the future.
| 197․ | The experts in their joint report have said the location of the site cut relative to the house is not in line with reasonable building practice, the site excavation is not compliant with good engineering practices and the site cuts are not safe. To make the site excavations compliant with good engineering practices landscaping works are required, including the formation of site cuts to a safe angle and the construction of retaining walls. |
| 198․ | Mr Johnson agreed with the proposition that on this site as the builder he was required to leave the site cut in a safe way.86 |
| 199․ | I am satisfied that the cost of rectification is a reasonable course to adopt and I allow the amount claimed. |
Site drainage
200․ The expert evidence establishes that the absence of drainage has created adverse moisture conditions, so that the site is still Class P, around the perimeter of the building. This collected water can contribute to softening of the foundation soils and exacerbate shrink/swell movements in the foundation soils by allowing more water penetration than what is considered by industry practice to be normal.[87]
[87] Exhibit C p 50
| 201․ | Mr Jones said that fortunately the pooled water was largely where weathered rock was exposed which reduced its potential impact, however it was difficult to forecast what the ongoing impact of that pooled water will be on the strength of the clayey soils adjacent to it other than softening the clay soils. He said it is an example of what not to let occur adjacent to a dwelling and called for drainage measures to be installed urgently.[88] |
[88] Ibid p 162
202․ Mr Buchanan noticed, when he was on site after it had been raining for a number of days, that water was coming into the house and saturating the carpet in one of the wardrobes. He concluded that it was likely the result of the landscaping and treatment of external areas not having been done. He saw a large puddle directly adjacent to this part of the house between the site cut and the slab edge. No drainage had been installed and he concluded that the water was surcharging back up into the house.[89]
| 203․ | I am satisfied that rectification is reasonable. There is no separate claim made for the cost of rectification because it will be undertaken as part of the further excavation. |
Driveway
204․ I have already found that the garage should be rectified so that it complies with the plans. As the garage will be at a lower level, the driveway will be affected. Mr Wilson has advised that rectifying the driveway to meet the corrected level of the new garage would require demolition for the entire length of the new section and rebuilding to the corrected grades.[90]
| 205․ | I also accept that the driveway as built detracts from the visual appearance of the house from the street which is a relevant consideration as to whether the rectification work claimed is reasonable. |
| 206․ | The rectification of the driveway involves the removal of the old and new concrete, with the driveway to be reformed in the shape according to the plans, and repoured to meet the reduced height of the garage floor. |
| 207․ | The cost has been agreed by the quantity surveyors as being $18,448.19.[91] |
| 208․ | I am satisfied that the cost of rectification is a reasonable course to adopt and I allow the amount claimed. |
[91] Plaintiff’s overall costing summary with escalation
Porch
| 209․ | The quantity surveyor's estimate of rectifying the driveway includes the cost of rectifying the porch.[92] |
[92] Transcript p 400
Garage door
| 210․ | Mr Gray has obtained a quote of $450 to fix the garage door. |
| 211․ | I am satisfied that this is reasonable and allow the amount claimed. |
Tiling expansion joints
| 212․ | Mr Gray has estimated the cost of retro fitting the control joints as $418. |
| 213․ | I am satisfied that this is reasonable and allow the amount claimed. |
Termite management system
| 214․ | Mr Gray has obtained a quote of $1,650 to bring the house to a compliance stage. |
| 215․ | I am satisfied that this is reasonable and allow the amount claimed. |
Stormwater lines
216․ Mr Gray has calculated that it would cost $4,631 for the lines to be removed, new trenches dug, new lines laid and then backfilling of the trenches.
| 217․ | I am satisfied that this is reasonable and allow the amount claimed. |
Minor defects
218․ I am satisfied that the rectification proposed for the balance of the minor defects (excluding the linen cabinet) is reasonable and allow the amounts claimed as set out in
the plaintiffs’ Reference Schedule
Certification
| 219․ | I have allowed all of plaintiffs’ claims except for one minor defect. |
| 220․ | The plaintiffs do not have a Certificate of Occupancy. |
221․ The building approval or commencement notice for the house was issued on 4 December 2018, therefore it lapsed on 4 December 2021.[93]
[93] Building Act 2004 (ACT) s36(1)(a)
222․ The plaintiffs will need to apply to have the Government Certifier appointed[94] to
negotiate a pathway towards closing the lapsed building approval, have a new building approval issued to rectify the works, and then place the Construction Occupations Registrar in a position to issue a Certificate of Occupancy.
| 223․ | Mr de Waal is of the opinion that the Government Certifier will undertake, at least, the following tasks, against which he allocated an estimated labour effort and a cost of their fees, inspections and making good of surfaces disturbed: |
Task Hours
Research past approvals, building file, correspondence, etc 16
| Site visit - initial, follow up to check specific items and to close out issues | 24 |
| Obtain documentation and inspection records from previous certifier | 8 |
| Re-certification of the multiple stages of the project - slab, framing, final, | 36 |
stormwater
| Liaison with Access Canberra to obtain and discuss plumbing and electrical | 12 |
inspections
| General correspondence, administration and issuing of new certification and | 48 |
approvals
TOTAL ESTIMATED HOURS 144
Estimated cost of Government Certifier at $175/hr excluding GST $25,200
| Allowance for various Access Canberra charges to re-examine their files or | $2,000 |
to provide information
| Allowance for invasive or destructive testing of compaction, slab, pipework | $7,500 |
and similar items
| Allowance for making good damage caused by invasive or destructive | $5,500 |
testing
| Allowance for additional expenditure for suppliers to re-create certificates | $3000 |
for, amongst others, windows, smoke detectors, electrical compliance
certificates, plumbing certificates ($750 each)
| ESTIMATED COST OF OBTAINING A CERTIFICATE OF OCCUPANCY | $43,200 |
excl GST
And including GST $47,520
224․ I accept these estimates and allow the sum of $49,910.26 which reflects the uplift
agreed on by the quantity surveyors to allow for the year which has elapsed since their
calculations were done. I consider the expenses are reasonable and necessary.
Loss of Amenity
225․ I have allowed the cost of rectification of almost every aspect of the plaintiffs’ claims
and accordingly make no award for loss of amenity.[95]
[95] Stone v Chappel
Apportionment
226․ It is common ground that s 140 of the Act applies. It provides that any damages awarded in the plaintiffs' favour must be apportioned between the builder and the second defendant, the certifier, for the proportion of the total amount of the damages that the court considers to be just, having regard to the extent of that defendant's responsibility for the loss or damage.
227․ The parties have agreed that those claims which were under the certifier’s regulatory
supervision should be apportioned as follows:
(a) The builder – 85 per cent
(b) The second defendant – 15 per cent.
Costs
| 228․ | I propose to make an Order for the first defendant to pay the plaintiffs costs. |
| 229․ | I will give the parties 28 days to inform the Court if they wish to be given the opportunity to make submissions for some other Order. |
Orders
| 230․ | I will now give the parties an opportunity to agree on the mathematical outcome of my findings. |
231․ I make the following Orders:
(1) Within 14 days the parties to advise the Court whether they have agreed on the
mathematical outcome of the findings in these Reasons.
(2) Within 28 days the parties to advise the Court if they wish to be given the
opportunity to make submissions for a costs Order other than:
i. The first defendant to pay the plaintiffs costs.
I certify that the preceding two hundred and thirty-one
[231] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Acting Justice Balla
Associate: Priyanka Tomar
Date: 19 May 2023
52 Ibid paragraph 152(d)
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