OWNERS OF STRATA PLAN 47111 and PYRAMID CONSTRUCTION (WA) PTY LTD
[2018] WASAT 34
•16 MAY 2018
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
CITATION: OWNERS OF STRATA PLAN 47111 and PYRAMID CONSTRUCTION (WA) PTY LTD [2018] WASAT 34
MEMBER: MS D QUINLAN (MEMBER)
MR C MARSH (SESSIONAL MEMBER)
HEARD: 7 & 8 FEBRUARY 2018
DELIVERED : 16 MAY 2018
FILE NO/S: CC 247 of 2017
BETWEEN: OWNERS OF STRATA PLAN 47111
Applicant
AND
PYRAMID CONSTRUCTION (WA) PTY LTD
Respondent
Catchwords:
Complaint regarding building service - Preliminary jurisdictional issue as to scope of item of complaint - Withdrawal of ambit invoices at late stage - Construct only contract - Sewerage overflows - Whether builder responsible for possible design faults in sewerage system - Whether failed to notify builder of issue - Whether properly mitigated loss - Whether issue would be known to competent builder
Legislation:
Building Services (Complaint Resolution and Administration) Act 2011 (WA), s 5(1), s 11, s 36(1)(a), s 36(1)(b)
Result:
Application successful in part
Representation:
Counsel:
| Applicant | : | JF Park |
| Respondent | : | RD Shaw |
Solicitors:
| Applicant | : | Park Legal Solutions |
| Respondent | : | Lavan |
Case(s) referred to in decision(s):
Owners of Island Apartments Strata Plan 52597 and Pindan Pty Ltd[2017] WASAT 25
South Central WA Pty Ltd and Diploma Construction (WA) Pty Ltd [2015] WASAT 38
Total Investments Pty Ltd and Rapley Wilkinson Pty Ltd[2015] WASAT 29
REASONS FOR THE DECISION OF THE TRIBUNAL:
Introduction
These proceedings arise in the Tribunal by way of a referral of a complaint made to the Building Commissioner under s 11 of the Building Services (Complaint Resolution and Administration) Act 2011 (WA) (the Act) concerning the Westbridge Apartments, located on Strata Plan 47111, and situated at 863 Wellington Street, West Perth.
The Tribunal conducted a hearing into the complaint items on 7 and 8 February 2018 where both parties were represented by legal counsel. Following conclusion of the hearing the parties provided written submissions to the Tribunal and advised the Tribunal on 15 March 2018 that neither party wished to supplement their written closing with oral closing submissions.
Evidence
The Tribunal has given consideration to the documentary evidence filed by the parties, the witnesses who gave evidence at the hearing and the submissions provided by the parties at hearing and in writing and, accordingly, provides the following reasons for decision of the Tribunal.
Issue to be determined
These proceedings are commonly referred to as workmanship proceedings which arise under s 5(1) of the Act.
The applicant lodged a complaint with the Building Commissioner which contained 8 Items. Items 4 (rusted gates) and 8 (hot water services) were withdrawn by the applicant following a mediation in the Tribunal and consent orders made on 18 September 2017.
It was common ground that the complaint items constitute a 'regulated building service' 'carried out' for the purpose of s 5(1) of the Act.
The issue in dispute to be determined by the Tribunal in these proceedings in relation to complaint Items 1, 2, 3, 5, 6 and 7 under s 5(1) of the Act is whether the regulated building service work has been carried out in a proper and proficient manner or is faulty or unsatisfactory.
The Tribunal pauses to note here that considerable time during the hearing was spent on a number of issues that were raised by the respondent on 8 January 2018 when they filed their response to the applicant's Scott Schedule, issues which were not addressed by the applicant until a late stage in the proceedings. For instance, even though these issues were known as early as 8 January 2018, it was not until cross-examination occurred of the applicant's strata manager that was consistent with the issues raised by the respondent in their response to the Scott Schedule that the applicant reconsidered its position on the claim which accepted the points made by the respondent. There were also a number of other amendments to the applicant's claim that occurred mid-hearing. We consider that it would not be unfair to characterise many of these invoices claimed as forming part of an ambit claim which, when challenged, the applicant withdrew.
Preliminary issue jurisdiction in relation to Item 3
It was common ground amongst the parties that the Tribunal's jurisdiction to determine a complaint referred to it by the Building Commissioner is only enlivened by the terms and scope of the complaint referred.
The dispute arose between the parties as to the terms and the scope of Item 3 of the complaint and the Tribunal's consideration of this issue in Owners of Island Apartments Strata Plan 52597 and Pindan Pty Ltd[2017]WASAT25 (Island Apartments and Pindan).
The complaint schedule attached to the building complaint form lodged with the Building Commissioner on 21 March 2016 (defined as the complaint) details Item 3 as follows:
No.
Item/location/clause
Description
Reference to evidence relied upon
Remedy sought
Respondent's response
3.
Dampness
Dampness causing mould inside Apartments 0 [sic] & 13
See Item 3 in attached report
Remedy order to pay costs for rectification
Has failed to rectify
The parties agreed that the typographical error in the description is a reference to 'Apartments 10 and 13'.
Of note to the Tribunal is that Item 3 to the complaint incorporates a reference to Item 3 in the attached report. However the attached Houspect Report dated 14 March 2016 (which itself also had Annexure A and Annexure B) at Item 3 only refers to 'dampness to the walls causing mould in Unit 10'.
The description of the alleged defective work contained in the applicant's Scott Schedule filed on 11 December 2017 is as follows:
The Respondent did not ensure that the Building was constructed to ensure the internal aspects and surfaces of units 6, 10, 12, 18 and 24 were protected from the ingress of water from the external aspects of the Building including by transmission through ducts and cavities.
In the details of the faulty work section of the Scott Schedule, the Tribunal notes that, during the course of the hearing, the applicant withdrew the descriptions or causes at paragraphs (b) and (c) and only pressed inadequate waterproofing described at paragraph (a).
The applicant submitted that its complaint was further clarified by the process undertaken in the Building Commission identified at pages 113 233 of Exhibit 4 which sought to clarify pages 3 63 of Exhibit 4 (Complaint and Annexures A to the 14 March 2016 Houspect Report). The applicant submitted at paragraph 14 of its closing submissions that "its Complaint is not limited to the scope identified on the pro-forma 'complaint form' but rather comprises all of the documents contained at pages 3 to 92 inclusive and 113 to 233 inclusive of Exhibit 4 …".
Of significant note for the Tribunal in these submissions, the applicant still does not point to a specific reference where the terms of the Scott Schedule description have been incorporated into the complaint before the Building Commissioner. This is not a technical issue. This is a matter of substance and procedural fairness. A complaint needs to be sufficiently described so as to enable the other party to respond: see Island Apartments and Pindan at [64].
The 'toing and froing' referred to in Island Apartments and Pindan at [114] is to clarify the terms of the complaint and may involve some amendment to the complaint but that amendment cannot involve in substance an extension of the statutory time period to make a complaint.
The Tribunal accepts and adopts the reasoning of the Tribunal in Island Apartments and Pindan, in particular where the Tribunal found at [57]:
The BSCRA Act is at its core consumer legislation. The purpose of the BSCRA Act is to provide consumers with a means to bring their complaints about 'the quality of performance of the regulated building service' in a nontechnical manner. It is about substance, not form.
The Tribunal considers that the applicant's submissions incorrectly apply the reasoning of the Tribunal in Island Apartments and Pindan.
The Tribunal in these proceedings agrees with and adopts the respondent's submissions on the preliminary issue.
The Tribunal finds that, in relation to Item 3, the Scott Schedule filed by the applicant in these proceedings on 11 December 2017 which represents the applicant's case pressed at hearing in its description of the defect and details of the faulty and/or defective work is quite different in substance to the complaint schedule attached to the complaint to the Building Commissioner.
The Tribunal finds that its jurisdiction to determine Item 3 is limited to dampness and water ingress issues for Unit 10 and does not include Units 6, 12, 18 and 24.
Item 1 Sewerage system overflows at ground level
Item 1 of the complaint relates to sewerage overflows at the ground level of the building and is detailed at paragraphs 1(a) (f) of the Scott Schedule.
It was common ground that the respondent is responsible for Item 1(a) being the blockage to the sewer pipe where it had been pierced by the reinforcing bar (reo-bar). The respondent accepted liability for the cost of inspection to locate the reobar fault however disputed the full cost of rectification as the respondent submitted it was not provided with the opportunity to rectify and/or given proper notification of the fault. The parties also diverged as to the consequential losses which flowed from the reo-bar fault.
The respondent disputed that it was responsible for paragraphs (b) (f) of Item 1 of the Scott Schedule on two bases. Firstly, that these relate to issues of design for which the builder is not responsible in the circumstances of this case. Secondly, that any failure of the reflux valve, which does occur from time to time, was not the responsibility of the respondent.
The applicant relied on the expert evidence of Mr Anthony Serek, a Senior Hydraulic Service Engineer. Mr Serek's report is at pages 1714 - 1747 of the Hearing Bundle. Mr Serek provided oral evidence to the Tribunal and was crossexamined on his expert opinion.
The applicant also relied on the evidence of Mr Brian Gray, a building inspector who provided three reports which commence consecutively at pages 1528, 1559 and 1627 of the Hearing Bundle. Mr Gray provided oral evidence to the Tribunal and was crossexamined on his expert opinion.
The respondent relied on the expert evidence of Mr Michael Howard, the Hydraulics Engineer who designed the sewerage system at the Westbridge Apartments, and his intended evidence was summarised by the respondent in the Scott Schedule.
Consideration of Item 1
The applicant experienced a number of events of sewerage flooding or overflows in the basement of the building. These events occurred in isolation in 2010 and 2012 with a number of incidents in 2015 (in particular) and 2016.
On 2 July 2016, Allpipe Technologies placed a camera down the affected sewerage pipe and discovered a reo-bar had pierced a sewerage pipe.
It was common ground amongst the experts that the reo-bar issue would affect any sewerage upstream and any sewerage downstream of the reobar location should be unaffected and continue to flow unless there was an unrelated incident downstream of that line.
During the course of the hearing it became apparent that the location of where the reo-bar was removed was not clear or certain on the evidence available. At the Tribunal's request Messrs Serek and Howard undertook a mid-hearing site visit and agreed the location where the reo-bar had been removed in relation to the sewerage plans. Once informed with the true location as to where the reo-bar had been removed (which was upstream of the sewerage overflow issues), neither expert was able to conclusively reach an opinion as to the ultimate cause of the sewerage overflow events that occurred largely throughout 2015 and 2016 in that the cause could not be conclusively attributed to the reo-bar fault.
Mr Serek was of the view that the probable cause was the absence of onsite reflux valves which would isolate the upstairs from the downstairs and/or faulty operation of the reflux valve at the junction with the 'Minister's sewer'. It was ultimately agreed by Mr Serek and Mr Howard that the possible cause of the sewerage overflow incidents was a failure of the reflux valve at the connection to the 'Minister's sewer'. However neither could be conclusive in their opinion as no extensive investigation was done at the time of an incident.
Neither Mr Howard nor Mr Serek could conclusively provide an opinion as to whether the reflux valve at the 'Minister's sewer' was faulty without an invasive investigation which involves going through the concrete slab at the junction with the 'Minister's sewer' to check the operation of that reflux valve, in particular at the time of a surcharge event.
However, the Tribunal notes that Mr Daniel Ehrenfeld gave evidence that the sewerage overflow problems have not re-occurred since the removal of the reo-bar and repairs relating to the reo-bar fault. Whilst we note that there was one invoice for clean-up of a sewerage flooding event on 25 April 2016, one week after the reo-bar's removal, there have been no further events since that date which is consistent with the evidence of Mr Ehrenfeld on this issue and this is evidence that we accept.
Of all the experts who proffered opinions on Item 1, the Tribunal is most persuaded by the expert opinion of Mr Serek. Mr Serek is eminently qualified in his area of expertise, and he is truly independent of the design and construction, unlike Mr Howard. Mr Serek was also an impressive witness by his investigation and preparation for the hearing. Mr Serek was in all respects, an impressive and persuasive expert witness. The Tribunal was assisted by Mr Howard but does not rely on his opinion in reaching a conclusion. The Tribunal was also assisted by Mr Gray but does not rely on his opinion in reaching a conclusion on the basis that his expertise in this area is more general in nature and is not equivalent to the specialist expertise of Mr Serek. Therefore, to the extent that any of the experts differ from Mr Serek on this topic, we prefer the expert opinion of Mr Serek.
Whilst it must be acknowledged that the ultimate cause of the instances of sewerage overflow remain inconclusive, the Tribunal is satisfied on the balance of probabilities that the faulty reo-bar has contributed to the sewerage problem such that it satisfies the requirements of s 5(1) of the Act in that it is a regulated building service being carried out in a manner that is not proper and proficient or is faulty or unsatisfactory.
We agree with the principles enunciated by the Tribunal in Total Investments Pty Ltd and Rapley Wilkinson Pty Ltd[2015] WASAT 29 (Total Investments and Rapley) at [10] - [12]. We would however distinguish the decision of the Tribunal in South Central WA Pty Ltd and Diploma Construction (WA) Pty Ltd [2015]WASAT38 (South Central and Diploma) from the present case in relation to Item 1. This is on the basis that the Tribunal on the facts and circumstances of the present proceedings finds that the respondent had a construct only contract, relied on the specialist expertise design of Hutchinson Associates (Mr Howard) and the issues raised in relation to faults as to the sewerage system design were not within the expertise of the respondent to identify during construction. In particular we find the issues concerning the reflux valves and isolation of the upstairs and downstairs to be issues of design that fall outside of the expertise and the responsibility of the respondent on the facts in this particular case. We find that a competent builder in this instance would not have known the potential implications of the design in the way that Mr Serek would know. Because we have found the matters alleged as faulty workmanship as detailed in the Scott Schedule for Item 1, other than the reo-bar, in the facts and circumstances of this case to be issues of design outside of the respondent's responsibility under s 5(1) of the Act, we will not make any further factual findings as to those design issues.
We note that Mr Serek's conclusions relied on his view that the sewerage system for the building was not built to the relevant Australian standards. Mr Howard contested that conclusion and ultimately we consider we do not need to make findings in this regard. This is due to our findings that this particular sewerage system was a matter of specialist design expertise that was outside the knowledge of a competent builder. We do not accept the applicant's submissions in this regard.
Subject to our other findings below, the Tribunal will order the respondent to pay some of the applicant's costs of cleanup and work undertaken to date that relates to Item 1. The Tribunal is cognisant that it may seem incongruous that the Tribunal is refusing to order remedial work for the inspection and replacement of the reflux valve at the 'Minister's sewer', a decision which is done on the basis of a lack of conclusive evidence that this constitutes faulty workmanship attributable to the respondent under s 5(1) of the Act. However, we are satisfied on the evidence that the reo-bar fault (even though upstream) and the fact that the overflow events have since ceased in order to be further satisfied to find that the respondent be liable for the clean-up costs.
Quantum for Item 1
However, this is not where the determination as to the quantum as to clean-up costs is concluded. The respondent disputes having to pay the clean-up costs when it is alleged that the applicant did not notify the respondent of the problem beyond the initial 2010 email and, in particular, provide the respondent with the opportunity to fix the reobar fault once it became known in July 2015. The applicant relies on the evidence of Mr Ehrenfeld to dispute this allegation.
The Tribunal finds Mr Ehrenfeld to be an unreliable witness. We do not find any issue with his credibility, however we do not accept his reliability as to the history of events. He was vague in his evidence and his recollection was poor. One instance of this occurred when the Tribunal asked him a series of questions in order to ascertain the true factual background concerning the reason why the applicant incurred a number of invoices attempting to fix the sewerage overflows rather than the builder doing the work, or being offered to do the work and refusing (ts 122 onwards; 7 and 8 February). The Tribunal found that Mr Ehrenfeld's oral evidence and recollection could not be relied upon. The only other evidence which corroborates Mr Ehrenfeld's recollection of engaging with the builder on issues of sewerage overflow was a series of email exchanges in August 2010 (pages 1037 - 1041 of the Hearing Book) in circumstances where the respondent attended within the hour of the reported incident, the matter was rectified and it was found (from the respondent's perspective) to be a maintenance issue.
When challenged about the lack of documentary notification Mr Ehrenfeld stated that a number of oral conversations occurred regarding the sewerage issue when the respondent was on site for other reasons and that the respondent was aware of the problems being experienced. However, in circumstances where there is evidently a practice of engaging in considerable correspondence regarding a number of issues, the Tribunal finds it difficult to accept that even if conversations were occurring, that there would be no contemporaneous correspondence to corroborate Mr Ehrenfeld's evidence that the sewerage issues were brought to the respondent's early and ongoing attention, particularly in 2015 and 2016 when the sewerage overflow incidents escalated.
Mr Jerry Masryk, the builder of Westbridge Apartments on behalf of the respondent who gave factual evidence testified that, apart from the incident in 2010, the respondent was not at any point notified of any sewerage issues and provided with the opportunity to undertake necessary investigations and remedial work (ts 260 261, 8 February 2018). Mr Masryk's evidence in this regard was not undermined in crossexamination.
Other than Mr Ehrenfeld's own poor recollection, there is no other evidence of any engagement with the builder regarding the issue of sewerage overflow between the isolated instances in 2010 and 2012, the four or so instances in 2015 (when the reo-bar was located), the other instances in 2016 and in April 2016 (when the reo-bar was removed).
Another issue of reliability concerning Mr Ehrenfeld's evidence arose in relation to the numerous invoices relied upon as to costs incurred for various complaints. A cursory glance at these particular invoices made it clear in crossexamination that many of them did not relate to the particular complaint and were incorrectly included as part of the applicant's case. For instance, somewhat incredulously, there were invoices forming part of the claim for Item 1 for taking the bins out. This issue was raised by the respondent prior to the hearing in the Scott Schedule but was not dealt with by the applicant until after crossexamination of Mr Ehrenfeld on these points. Mr Ehrenfeld did not appear to be aware of the issue until he was crossexamined on it even though his representative had earlier provided the Tribunal with a schedule which crossreferenced the amounts claimed with the invoice page numbers in the Hearing Book. These points were obvious on the face of the invoices and the description provided of the work performed.
The Tribunal considers it is worth noting that it is disappointing to the Tribunal, in circumstances where a party is represented, and the other party has been upfront in its objection to untenable parts of the claim, that hearing time was wasted on this issue.
Mr Ehrenfeld's lack of reliability as a witness of fact is perhaps unsurprising in the circumstances. Whilst we note there were no directions from the Tribunal for the preparation and exchange of witness statements and, ultimately, it is up to a party as to how it presents its case at hearing, it was abundantly clear from the Scott Schedule that there were issues of fact in dispute in these proceedings, in particular in relation to the reporting of the incident to the respondent and the invoices claimed. Mr Ehrenfeld did not provide a witness statement that cross referenced the documents relied upon and was not adequately prepared to provide his oral testimony to speak to the documents which the applicant sought to rely upon in support of its case. Inevitably, this lack of preparation and poor independent recollection adversely affected his reliability as a witness to a significant extent.
The Tribunal finds that, except in relation to our finding below accepting Mr Ehrenfeld's evidence that the incidents of sewerage overflow have ceased since the removal of the reo-bar, where Mr Ehrenfeld's evidence differs from another witness, or even a document, his evidence cannot be accepted by the Tribunal as a correct statement of fact.
The applicant provided the Tribunal during the hearing with a schedule with Annexures A to D crossreferencing the invoices in the bundle. As noted above, the applicant made a number of withdrawals of invoices throughout the hearing in relation to Item 1 (pages 790, 808, 806 (only in part - remove $136.36 plus GST), 817, 818 and 822 of the Hearing Book). In written closing submissions, the applicant did not provide the Tribunal with a revised quantum of the claim. It appears from the Tribunal's own calculations that the applicant's revised claim for the monetary component for Item 1 for reimbursement of costs associated with the reo-bar and valve issues is $9,761.59.
The respondent submits that the applicant is not entitled to reimbursement of costs after the discovery of the reo-bar issue on 2 July 2015 (page 800 of the Hearing Book) because the applicant did not afford the respondent the opportunity to remove the reo-bar and the applicant did not act on the finding of the reo-bar until its removal some nine months later on 18 April 2016.
The Tribunal finds in the circumstances of this matter, that it was unreasonable for the applicant not to notify the respondent following discovery of the reo-bar fault on 2 July 2015 and provide the respondent with the opportunity to rectify. Further, the Tribunal also considers it unreasonable and a failure to mitigate loss, that the applicant waited some nine months to remove the reo-bar in circumstances where further overflow events occurred which required a clean-up to be undertaken.
Despite our finding it was unreasonable that the respondent was not notified of the sewerage overflow incidents beyond 2010, in the exercise of our discretion, the Tribunal will allow all clean-up costs and plumbing investigation work up to and including the invoice dated 18 August 2015 (which included the cost of the CCTV investigation on 2 July 2015). However due to our findings above we will not allow clean-up costs after 18 August 2015 and will not allow the full cost of the reo-bar removal of $3,770.34. The Tribunal found Mr Masryk to be a reliable and honest witness. We prefer the evidence of Mr Masryk that it would cost $1,800.00 for the respondent to do the work.
Therefore, the Tribunal allows the following sums evidenced by the invoices in the Hearing Book at pages 800 ($1,221.00), 802 ($506.00), 803 ($1,353.00), 816 (in part $112.50), 819 ($90.00) and 820 ($135.00). We will allow the respondent's estimate of $1,800.00 for the removal of the reo-bar. These amounts total $5,217.50.
Item 2 Flooding of elevator shaft and ground floor
Item 2 of the complaint relates to the flooding of the elevator shaft and the ground floor of the building due to a stormwater pipe being damaged by a large piece of wood being dropped into it. The applicant also alleges that the waterproofing of the lift wells was found to be unsatisfactory by the amount of water that entered into it as a consequence of the blocked stormwater pipe.
As with Item 1, the applicant made a number of concessions at the hearing in relation to Item 2 as to incorrect invoices being claimed in the Scott Schedule and the Annexure B provided at hearing. However the applicant did not assist the Tribunal by including in its closing submissions the revised amount claimed. By the Tribunal's own calculations, we understand that the revised claim totals the amount of $9,160.91 (pages 801, 834, 842, 843, 845, 846, 847, 848 and 851 of the Hearing Book).
Whilst it is not entirely clear from the applicant's closing submissions, it appears to the Tribunal that the applicant may also claim $35,017.40 for the cost of waterproofing work to the lift well (page 1576 of the Hearing Book contained within the report of Mr Gray).
The respondent accepts responsibility for the blockage of the stormwater pipe by the piece of wood and agrees to pay for those remedial works already undertaken by the applicant in the amount of $2,954.97 (pages 801 and 834 of the Hearing Book). The respondent disputes the other invoices and crossexamined Mr Ehrenfeld about those invoices. The respondent also disputes that waterproofing of the lift well is required as remedial works. The respondent submits that in the past only the holes in the pits of the lift have had water coming through them and following the remedy by removing the wood from the stormwater pipe, no further flooding of the lift well has occurred.
Consideration of Item 2
The Tribunal is satisfied on the evidence presented and the concessions made by the respondent that the blockage of the stormwater pipe by the piece of wood during construction of the building satisfies the requirements of s 5(1) of the Act in that it is a regulated building service being carried out in a manner that is not proper and proficient or is faulty or unsatisfactory.
The dispute in relation to Item 2 arises in relation to consequential works the applicant claims are necessary to the lift.
Mr Gray, called by the applicant to provide expert evidence, is of the view that the wood being dropped into the stormwater pipe which cracked the pipe bend causing stormwater to enter the lift well and create damage to the lift components is faulty and unsatisfactory workmanship. Mr Gray recommends that the remedy required is to remove the blockage, repair and replace the damaged stormwater pipe. Contrary to the work suggested in the Schindler quote for waterproofing, Mr Gray recommended that the base of the lift shaft be waterproofed to ensure that water cannot enter the lift well and cause any further damage to the lift components. Mr Gray also recommends that Schindler lifts rectify the damaged components of the lift (pages 1576 - 1578 of the Hearing Book).
The Tribunal notes that an expert from Schindler lifts was not called to give evidence to justify the extent of waterproofing quoted. It is not clear, but this may be because the applicant is seeking an order that the respondent undertake the waterproofing.
Mr Richard Machell, a building inspector, prepared an expert building report for the applicant but was ultimately called to give expert evidence by the respondent. Mr Machell provided a very detailed and persuasive analysis of the lift well issue in his report (pages 1652 1656 of the Hearing Book). Ultimately, Mr Machell recommends that further testing is required to determine if a leak issue remains in the floor of the lift well. The Tribunal agrees with and relies on the analysis by Mr Machell. The Tribunal considers that it has been provided with insufficient evidence to determine whether there is a problem with the waterproofing in the lift well. Indeed the evidence presented suggests there have been no further water ingress issues into the lift well following repair of the stormwater pipe.
However, following the conclusion reached by Mr Machell at point 6.7 of his report, the Tribunal is satisfied that, prior to the damaged stormwater pipe being repaired, water was able to enter the lift well through what appeared to be unfilled formwork bolt spacers in the concrete wall.
Rectification order for Item 2
Therefore, the Tribunal is satisfied based on our findings in relation to the evidence presented that the unfilled formwork bolt spacers in the concrete wall of the lift well satisfies the requirements of s 5(1) of the Act in that it is a regulated building service being carried out in a manner that is not proper and proficient or is faulty or unsatisfactory. The Tribunal considers it appropriate in the circumstances of this matter to order the respondent to rectify that faulty workmanship. In light of the respondent's concession in their written closing submissions, we consider it appropriate in the circumstances of this case to order a specific remedy. We will order the respondent to rectify the unfilled formwork bolt spacers in the concrete wall of the lift well within 28 days.
It follows from this finding of the Tribunal, that we will not be awarding the applicant's the amount identified in the Schindler quote (page 1576 of the Hearing Book).
Quantum for Item 2
As stated above, by the Tribunal's own calculations we understand that the revised claim totals the amount of $9,160.91 (pages 801, 834, 842, 843, 845, 846, 847, 848 and 851 of the Hearing Book). The respondent agreed with the invoices at pages 801 and 834 of the Hearing Book but disputes the remaining invoices.
The respondent submits that invoices at pages 846, 847 and 848 of the Hearing Book relate to the roof pump as evidenced at page 1149 of the Hearing Book. The Tribunal agrees with the respondent's submission in this regard and finds that the applicant has not satisfied the Tribunal that these invoices relate to the wood in the stormwater pipe nor the bolt spacers in the concrete wall of the lift well.
The respondent submits that the invoices dated January and April 2012 at pages 842, 843 and 845 of the Hearing Book are unclear as to what they relate to. We do not accept the respondent's submissions in this regard. Following an examination of those invoices and the invoice at page 851 of the Hearing Book and our consideration of the evidence as a whole, we are satisfied on the evidence that it is open for us to draw the necessary inferences that they relate to the issue of water ingress as a consequence of the wood in the stormwater pipe.
Therefore, the Tribunal will allow the amounts claimed totalling $5,476.17 for the invoices at pages 801, 834, 842, 843, 845 and 851 of the Hearing Book.
Item 3 Dampness in Unit 10
In accordance with the Tribunal's preliminary finding as to jurisdiction above, Item 3 of the complaint relates to dampness only in Unit 10.
Further, during the hearing the applicant withdrew paragraphs (b) and (c) of the details of the defective work section of the Scott Schedule and the invoices claimed at Annexure C of the Scott Schedule totalling $21,158.60.
Mr Machell did not inspect Unit 10 therefore his evidence is of no assistance to the Tribunal (page 1656 at paragraph 6.27 of the Hearing Book).
Mr Gray found some mould in Unit 10 but no dampness or moisture was detected with his opinion being that this was due to no rain in recent times (page 1579 of the Hearing Book).
Mr Masryk's view when he considered the issue on 2 October 2015 was that the issue in Unit 10 related to condensation (that is, internal to the unit) and not water ingress (page 1191 of the Hearing Book).
Consideration of Item 3
The Tribunal agrees with the respondent's submission in relation to Item 3 that the applicant has not established any defective work of the respondent in relation to Unit 10. There is simply insufficient evidence to substantiate the claim for Item 3. Therefore, the Tribunal finds that the mould Mr Gray observed in Unit 10 and his opinion derived from observing that mould, is insufficient evidence to substantiate a finding that the respondent carried out a regulated building service in a manner that was not proper or proficient or was faulty or unsatisfactory under s 5(1) of the Act.
Accordingly, Item 3 of the complaint will be dismissed.
Item 5 Water leaks level 1, courtyards for Units 5 and 6
Item 5 of the complaint relates to water leaks or drainage problems for the courtyards of Units 5 and 6.
The applicant submits that the conclusion to be drawn from the expert evidence of Messrs Serek and Howard is that the grates and grading of the balcony tiles for the courtyards for Units 5 and 6 are not fit for purpose thereby causing water ingress into the storerooms which are not required to be waterproofed. The applicant submits that, as the storerooms are not waterproofed, water ingress must be prevented from entering the storerooms from the courtyards (ts 196 197; 206, 209 210 and 267, 8 February 2018).
The respondent submits that the cause of water pooling around the drains and then entering the storerooms is not due to any failure on the part of the respondent, it is a maintenance failure of the occupants of Units 5 and 6 to sweep their courtyards. The respondent submits that the tiling gradient is compliant with the Building Code of Australia (BCA). Further, the respondent submits that the grate provided was in accordance with the hydraulic engineer engaged by the respondent to provide specialised design advice (pages 1818 - 1836, 1665, 1724 of the Hearing Book).
Consideration of Item 5
As found by the Tribunal in relation to Item 1, the Tribunal was impressed by the evidence of Mr Serek and accepts his opinion in relation to the need for 100 millimetre grates as this accords with the Tribunal's view of the current grates for Units 5 and 6 being inadequate and not fit for purpose.
In relation to Item 5 (unlike Item 1 above), the Tribunal is of the view that the present circumstances accord with the decision in South Central and Diploma and the principles enunciated by the Tribunal in Total Investments and Rapley at [10] - [12].
We find that a competent builder would have known that the placement of the small grate so close to a storeroom door that is not waterproofed may on occasion cause water ingress into the building and that action should be taken to prevent such water ingress.
Therefore, the Tribunal is satisfied that the drainage, the grates that are too small and not fit for purpose in relation to Units 5 and 6 and the placement of those grates too close to a storeroom that is not waterproofed all satisfy the requirements of s 5(1) of the Act in that it is a regulated building service being carried out in a manner that is not proper and proficient or is faulty or unsatisfactory. The Tribunal considers it appropriate in the circumstances of this matter to order the respondent to rectify that faulty workmanship.
Preventing water ingress into the storerooms of Units 5 and 6 could be achieved in a number of ways. Mr Serek, whose evidence in this regard we prefer, suggested that the grates be replaced with 100 millimetre grates and that the affected storeroom doors are replaced. We consider it appropriate to make a specific remedy order in those respects. In relation to the steps to be taken to prevent water ingress into the storeroom, there were a number of suggestions from the experts. We have determined that in this instance we will not make a specific remedy order, we will order the respondent to perform remedial work to prevent water ingress into the storeroom and thereby into the building. It will be a matter for the respondent to exercise its own skill and judgment as to what measures will be taken.
Item 6 Water isolation valves
Item 6 of the complaint relates to water isolation valves in each of the units.
The respondent accepts the report of Mr Machell in this regard and admits that the isolation valves do not satisfy the relevant requirements. Therefore, the Tribunal is satisfied that the issues raised in relation to the isolation vales in each of the units satisfies the requirements of s 5(1) of the Act in that it is a regulated building service being carried out in a manner that is not proper and proficient or is faulty or unsatisfactory.
It appears from the applicant's submissions concerning the cost of the remedial work that the applicant does not want the respondent to do the remedial work. It is not clear why this is so when in relation to other items of complaint the applicant wants the respondent to undertake the remedial work. The respondent also wishes the Tribunal to make a monetary order in this regard.
The applicant submits that we should prefer the estimate of Mr Gray ($10,000 $15,000) and the respondent submits we should prefer the estimate of Mr Machell ($1,782).
Consideration of Item 6
We have difficulty with the estimates of both Mr Machell and Mr Gray. We find that neither estimate is sufficiently detailed or supported in logic. We consider that Mr Machell is too vague and too low and Mr Gray is too vague and too high. However the Tribunal has insufficient evidence to arrive at a different figure. Therefore, we consider that a rectification order is more appropriate in the circumstances.
We will order the respondent to inspect the isolation valves in all units and to remedy access where necessary in accordance with the applicable Australian Standard AS/NZS 3500.1-2003: Water services.
Item 7 Water penetration through the slab of south carpark to basement
Item 7 of the complaint relates to the issue of water penetration through the suspended concrete slab of the south carpark into the basement.
The applicant submits that the respondent should have ensured that water did not leak into and through the concrete slab of the south carpark into the basement below and that the respondent should be ordered to perform rectification work to remedy the cause.
The respondent did not dispute that water penetrates the slab into the south carpark however submits that there was no requirement under the BCA or the contract for the slab to be waterproofed. The respondent submits that there is no evidence to support a finding that there was any shortcoming in the design regarding which a competent builder would be held responsible.
Consideration of Item 7
The Tribunal is satisfied on the evidence presented to make a finding that water, or a water like substance, enters the south carpark through the concrete slab. We further find that persistent water ingress over time can ultimately cause damage to cars and the basement area.
Messrs Gray, Machell, Stokes and Masryk all gave oral evidence regarding Item 7. Mr Stokes was the structural engineer engaged by the respondent in relation to the concrete slab.
Without disregarding the evidence of Mr Gray and Mr Machell, we find that the evidence of both Mr Stokes and Mr Masryk was particularly important in considering Item 7. Both Mr Stokes and Mr Masryk agreed in crossexamination in substance with the proposition that cracking of a suspended concrete slab exposed to the elements such that it allows water to pass through was not uncommon and foreseeable within their individual expertise. Mr Masryk's evidence in this regard is a significant reason as to why we find him to be an honest and reliable witness.
Whilst we accept the submission that neither the contract nor the BCA required the concrete slab to be waterproofed and therefore the respondent's construction of the slab was not faulty under s 5(1) of the Act. However, we do consider the cracks in the concrete slab to be unsatisfactory under s 5(1) of the Act and that those cracks should be remedied by the respondent.
We note the remedy suggested by Mr Stokes, the expert called by the respondent who gave evidence with the most expertise in relation to concrete slabs. Mr Stokes recommended that the leaking cracks be sealed with nitofill LV injection system or approved equivalent. However, we consider it is not appropriate in the circumstances for the Tribunal to direct the respondent as to which method to utilise to seal the leaking cracks. We will order the respondent to remedy the cracks by sealing the leaking cracks.
Costs
The applicant in written closing submissions sought for the Tribunal to make an order that the respondent pay the applicant's costs to be taxed if not agreed. This submission does not appear to recognise the general approach to costs in the Tribunal, and in particular, in these types of proceedings.
We will make programming orders in relation to a costs application on the basis that either party may make an application for costs and leave it to each of the parties' representatives to consider the Tribunal's approach to costs in previous decisions and to confer in light of these reasons.
Orders
In accordance with these reasons for decision, the Tribunal orders as follows:
1.Within 14 days of the date of these orders, pursuant to s 36(1)(b) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA) (the Act), the respondent is to pay the applicant the total sum of $10,693.67 broken down as follows in relation to each of the items of complaint:
(a)Item 1 - $5,217.50; and
(b)Item 2 - $5,476.17.
2.Within 28 days of the date of these orders, pursuant to s 36(1)(a) of the Act, the respondent is to remedy and to make good all affected areas the following items of complaint:
(a)Item 2 - fill the unfilled formwork bolt spacers in the concrete wall of the lift well;
(b)Item 5 replace the grates with 100 millimetre grates and replace the affected storeroom doors of Units 5 and 6;
(c)Item 5 carry out remedial work to prevent water ingress into the storerooms of Unit 5 and 6;
(d)Item 6 inspect the isolation valves in all units and to remedy access where necessary in accordance with the applicable Australian Standard AS/NZS 3500.1-2003: Water services; and
(e)Item 7 seal the leaking cracks in the concrete.
3.Item 3 of the complaint is dismissed.
4.Within 28 days of the date of these orders, either party may file and serve an application for costs by providing submissions and any evidence in support of an application.
5.Within 14 days of any application for costs being made by any party, the other party may file and serve responsive submissions and evidence in support.
6.Subject to any further order, any application for costs is to be determined entirely on the documents pursuant to s 60(2) of the State Administrative Tribunal Act2004 (WA).
I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.
MS D QUINLAN, MEMBER
16 MAY 2018
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