Olindaridge Pty Ltd v Tracey - [2013] QCATA 345

CITATION:

Olindaridge Pty Ltd & Anor v Tracey & Anor [2013] QCATA 345

PARTIES:	Olindaridge Pty Ltd Rodney Kenneth Wagner (Applicants/Appellants)
v
Martha-Lee Tracey and Todd Anthony Tracey (Respondents)

APPLICATION NUMBER:

APL379-13

MATTER TYPE:

Appeals

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Member Howard

DELIVERED ON:

14 October 2013

DELIVERED AT:

Brisbane

ORDERS MADE:

1. The operation of the decision of Member Lewis made 5 August 2013 in BDL136-11 is stayed until further order.

CATCHWORDS:

APPLICATION FOR LEAVE TO APPEAL AND APPEAL – APPLICATION FOR STAY PENDING APPEAL – whether arguable case – whether balance of convenience favours granting a stay

Queensland Civil and Administrative Tribunal Act 2009

Cook’s Constructions Pty Ltd v Stork Food Systems Australia Pty Ltd [2008] QCA 322
Deputy Commissioner Stewart v Kennedy [2011] QCATA 254

APPEARANCES and REPRESENTATION (if any):

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

REASONS FOR DECISION

Following the hearing of a building dispute between the parties, the Tribunal made orders that Olindaridge Pty Ltd and Mr Wagner (the builders) pay the sum of $98,000 to the homeowners, the Traceys, within 28 days of the decision. Olindaridge and Mr Wagner filed an application for leave to appeal and appeal. They also filed a stay application.
I determined the stay application. I made orders that the operation of the learned Tribunal member’s decision be stayed pending the determination of the applications for leave to appeal and appeal. Mr and Mrs Tracey, the homeowners, have requested reasons for the decision on the stay application.
The Appeal Tribunal can make orders under s 145(2) to stay an order pending the determination of the appeal. The principles concerning when it may be appropriate to exercise the discretion to grant a stay are well established. The party seeking a stay must establish that it has an arguable case on the appeal; that it will be disadvantaged if the stay is refused and that the balance of convenience favours the granting of the stay.[1]
[1]Cook’s Construction Pty Ltd v Stork Food Systems Australia Pty Ltd [2008] QCA 322; Deputy Commissioner Stewart v Kennedy [2011] QCATA 254.
The builders assert that they have a good arguable case on appeal. In particular, they submit, among other things, that the learned Member failed to make findings about whether Mr Wagner owed the homeowners a duty of care in the circumstances of the case, and that Mr Wagner did not owe such a duty; that the learned Member failed to consider the effect of a third party’s (Victory Pest Control) actions on the chain of causation; that the learned Member failed to consider the extent to which the homeowners contributed to their own loss and failed to mitigate their loss; and in error, relied on evidence of persons not made available for cross-examination.
They submit that they will be disadvantaged if the stay is not granted. In particular, they argue that Olindaridge does not have the capacity to meet the judgment and attempts to enforce it will result in voluntary administration. If this occurs they submit that Mr Wagner may, because of the operation of the Queensland Building Services Authority Act 1991 (QBSA Act), be unable to earn an income for the next 5 years within the building industry. They submit that Mr Wagner has insufficient current assets to meet the judgment and does not have the ability to borrow sufficient funds to meet it. He submits that if it is enforced before determination of the appeal and before Mr Wagner can sell non-current assets that effectively he will be forced into bankruptcy. The homeowners took steps in early September to enforce the judgment by registering it in the Magistrates Court.
The builders argue that the competing disadvantage to the home owners (that is, an inability to enforce the decision for the duration of the appeal) does not outweigh the prejudice that will be suffered by the builders if a stay is not granted.
The home owners submit that the application for leave to appeal and appeal and the stay application ought to have been filed by 2 September 2013. Further, they argue that the builders provided false information on their application for leave to appeal and appeal, in relation to the contents of a BSA report (Ground 5 of the application refers). In relation to the ground of appeal relating to Mr Wagner’s personal liability, they submit that an earlier decision of the Appeal Tribunal (dated 21 February 2013 which had not been appealed) decided this point.
The home owners submit that they will be disadvantaged if a stay is granted as there is no good reason for the appeal to succeed. Further, they argue essentially that they are entitled to the fruits of the decision in their favour. They believe that the builders have assets and ‘would have’ insurance to cover them, and that there is no material to support the claims of consequences of liquidation and bankruptcy, alleging that Mr Wagner lives in a house worth some $1.3M dollars, has other real estate (which was initially not disclosed to the Tribunal but the oversight was acknowledged shortly after the filing of the application and supporting material) with his wife which is for sale, and a business. Further, they are suffering because their house is ruined and not healthy or safe to live in. Finally, they submit that the builders are trying to blame someone else for defective work in circumstances when they built the house.
The decision subject of the application was made on 5 August 2013. The date by which the homeowners allege the application should have been filed is 2 September 2013. That date is 28 days from the day the decision was made, inclusive of the date it was made. However, essentially a party must file within 28 days after the day it is given written reasons for the decision: s 145.[2] Therefore, the application was not required to be filed by 2 September. In relation to whether false information was supplied, this is not for me to determine on the stay application: it will be a matter for the final hearing.
[2]Although the section has been amended since the appeal was filed the effect of it in relation to the relevant date is unchanged.
Does the builder have an arguable case?
It is not for me to undertake a detailed assessment of the builder’s prospects of success on the appeal. What I must do is undertake a preliminary assessment whether the builder has an arguable case on its application.
I do not need to traverse all of the grounds of appeal raised, in view of the comments that I make in relation to Grounds 1 and 2 which are discussed below.
The first ground of appeal relates to the learned Member’s alleged failure to make findings about whether Mr Wagner personally owed a duty of care to the homeowners. The Member’s reasons for decision say that this issue had been determined in earlier appeal proceedings.[3] The builders’ grounds of appeal are to the effect that the earlier appeal decision (about an interlocutory decision to strike out the claim against Mr Wagner personally) did not relieve the learned member who made the final decision from making findings about whether Mr Wagner owed a duty of care to the home owners.
[3] Paragraphs [56-57].
The earlier appeal decision was only about whether the strike out application should succeed. Several decisions relating to negligence of a builder personally were referred to in that decision. As a result of that interlocutory decision, Mr Wagner remained a respondent at the final hearing. Without determining the matter and as a preliminary observation, it is difficult to see how a decision about an interlocutory issue could determine whether a duty of care ultimately existed.
Ground 2 relates to whether the chain of causation may have been broken by the actions of Victory Pest Control which was engaged by the homeowners. The reasons for decision in paragraphs [72 to 76] refer to Victory and their apparent lack of success in ‘solving the problem’, but that no adjustment should be made. Again, I make a preliminary observation only, but there do not appear to be findings made about Victory’s role in reaching this conclusion.
Without making any determination, in my view, the grounds discussed appear to raise an arguable case.
Where does the balance of convenience lie?
Olindaridge ceased building work in about February 2008, although it was a labour hire company until October 2012. The final balance sheet indicates that liabilities exceed assets. It says it can not pay the award. If the award is enforced against it, the QBSA Act[4] may operate to render Mr Wagner an excluded individual because he was a director until 19 January 2012. The consequence may be that he is then unable to earn a living as a builder for 5 years. Mr Wagner currently has income as a builder. He has assets which could be realised in due course to pay the award but not immediately.
[4] QBSA Act Part 3A.
Immediate enforcement may deprive Mr Wagner from earning an income in the building industry for up to 5 years. On the material before me, he has assets which can in due course be liquidated if the appeal is unsuccessful.
That said, the homeowners house is in an undesirable state. If a stay is granted, the home owners’ right to enforcement will be delayed. However, if a stay is granted and the appeal is unsuccessful, they will otherwise be in a similar position as they were when the decision was made.
I accept that the disadvantage to the builder is greater if the stay is refused than the disadvantage to the homeowners if it is granted.
I am satisfied that the balance of convenience favours granting the stay.
Conclusions
The builders have an arguable case and the balance of convenience favours granting the stay. I make orders accordingly.