Owners Of Strata Plan 52843 and Psaros Pty Ltd - [2018] WASAT 113

JURISDICTION     :   STATE ADMINISTRATIVE TRIBUNAL
ACT: BUILDING SERVICES (COMPLAINT RESOLUTION AND ADMINISTRATION) ACT 2011 (WA)
CITATION:   OWNERS OF STRATA PLAN 52843 and PSAROS PTY LTD [2018] WASAT 113
MEMBER:   MS C WALLACE (SENIOR MEMBER)
HEARD:   23 AUGUST 2018
DELIVERED          :   1 NOVEMBER 2018
FILE NO/S:   CC 656 of 2018
BETWEEN:   OWNERS OF STRATA PLAN 52843
Applicant
AND
PSAROS PTY LTD
Respondent

Catchwords:

Building service complaint Who carried out remedial works pursuant to building remedy order Whether another entity can assume legal responsibility for a building remedy order Jurisdiction of Tribunal to vary final orders Meaning of 'liberty to apply'

Legislation:

Building Services (Complaint Resolution and Administration) Act 2011 (WA), s 5(1), s 11(1)(d), s 36(1)(a), s 36(1)(c), s 36(3), s 51, s 58
State Administrative Tribunal Act 2004 (WA), s 47, s 56(3), s 83

Result:

Application dismissed

Category: B

Representation:

Counsel:

Applicant	:	Mr Buchan
Respondent	:	Mr Steinepreis

Solicitors:

Applicant	:	Hotchkin Hanly
Respondent	:	Squire Patton Boggs

Case(s) referred to in decision(s):

Abigroup Ltd v Abignano (1992) 112 ALR 497
Owners of Strata Plan 52843 and Psaros Builders Pty Ltd [2013] WASAT 46
Psaros Builders Pty Ltd v Owners of Strata Plan 52843 [2014] WASC 34
Shami and Teo [2017] WASAT 73
Tulloh v Chief Executive Officer of the Department of Corrective Services [2018] WASC 105
Wentworth v Woollahra Municipal Council (1983) (unreported, Court of Appeal, NSW, 31 March 1983)

REASONS FOR DECISION OF THE TRIBUNAL:

Introduction

On 28 March 2018 the Building Commissioner referred a building service complaint to this Tribunal pursuant to s 11(1)(d) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA) (BSCRA Act). The applicant, Owners of Strata Plan 52843, raised a complaint against the respondent, Psaros Pty Ltd, in relation to the construction of a strata complex at 154 Newcastle Street, Northbridge (known as 'Tyne Square'). The complaint was lodged with the Building Commissioner on 10 March 2018 and alleges in respect of the basement carpark to the strata complex that there is 'water ingress in six separate areas of carpark' and the remedy sought is identified as 'remediation to stop water ingress'. Pursuant to s 5(1) of the BSCRA Act, the applicant alleges that as a result of the water ingress that a regulated building service has not been carried out in a proper and proficient manner or is faulty and/or unsatisfactory.
The matter was listed for an initial directions hearing on 17 April 2018 at which time I raised with the applicant concerns that the complaint had been previously agitated in 2012 against a different entity, that being Psaros Builders Pty Ltd (Psaros Builders), which resulted in published reasons and building remedy orders being made in the applicant's favour. On the basis that the complaint had been brought previously, determined and a remedy given, I queried with the applicant on what basis the same complaint could now be made as against a different entity.
I raised with the applicant my preliminary view that the only course of action now available to the applicant if it contended that a building remedy order had not been complied with, was to make an application pursuant to s 51 of the BSCRA Act seeking that the Tribunal revoke the building remedy order and replace it with an order reflecting the reasonable costs of compliance.
In the circumstances, programming orders were made to determine, as a preliminary issue, whether the matter could proceed or whether it ought to be dismissed as misconceived and/or lacking in substance.
The applicant provided written submissions in relation to the preliminary issue on 29 May 2018 and the respondent provided responsive submissions on 26 June 2018. The parties also provided a joint statement of agreed facts dated 6 August 2018 (parties agreed facts) together with a bundle of documents dated 21 August 2018 (parties' agreed bundle). A bundle of additional documents was also provided to the Tribunal by the applicant on 17 August 2018 (Applicant's Bundle).
The nature of the preliminary issue was modified prior to a hearing taking place. This will be addressed in greater detail shortly, but effectively it became clear that the building service complaint was in respect of remedial work performed, rather than the original construction of Tyne Square. The preliminary issue to be determined was therefore modified to address the question as to who carried out the relevant regulated building service, and in particular whether it was the respondent or Psaros Builders who undertook the original construction.
The preliminary issue was listed for hearing on 23 August 2018. Following conclusion of the hearing the applicant provided supplementary written submissions on 27 August 2018 and the respondent provided its supplementary written submissions on 6 September 2018. The decision was reserved as of 6 September 2018.
Before addressing the substantive issue it is important to set out the procedural history of the previous matter before the Tribunal given its significance to the current determination.

Procedural history

The applicant initially lodged with the Building Commissioner a building service complaint against Psaros Builders in respect of alleged water ingress into the basement at Tyne Square on 27 March 2012. Complaint number 2 is relevant and sets out the following:
Water ingress to basement carpark water ingress to basement carpark and associated basement areas described in the notice of proposed complaint served on builder on 7 March 2012. Remedy sought rectification.
The complaint was ultimately referred by the Building Commissioner to the Tribunal pursuant to s 11(1)(d) of the BSCRA Act for determination.
The final hearing was presided on by a legally qualified senior sessional member, a specialist senior sessional member, being a civil and structural engineer, and a specialist sessional member, being a registered builder. The hearing was long and took place over six days during October and December 2012. Reasons were published and final orders made on 5 April 2013: Owners of Strata Plan 52843 and Psaros Builders Pty Ltd [2013] WASAT 46.
The introduction to the reasons of the Tribunal clearly evidences that the applicant was alleging that the basement of the building leaked, that is, that the basement allowed water to ingress into it. On this basis it was alleged that Psaros Builders did not construct the basement carpark in a proper and proficient manner and/or that the regulated building service was faulty and/or unsatisfactory, entitling the applicant to a building remedy order requiring Psaros Builders to rectify the basement in accordance with the applicant's experts' recommendations ([4][8]).
The Tribunal made particular findings in relation to the cause of the water ingress into the basement and attributed those causes to a failure by Psaros Builders to carry out the regulated building service in a manner which was proper and proficient or which was faulty or unsatisfactory. Those causes of the water ingress attributable to Psaros Builders were as follows:
(a)the construction of the basement with relief vents that punctured the vapour barrier, resulting in the basement not complying with the Building Code of Australia (at [311]);
(b)the installation of the vapour barrier, instead of one of the possible types of waterproofing set out under 'Water Proof Membranes Systems' in the specifications of the relevant contract, which amounted to a breach of the contract and constituted a failure to carry out the regulated building service in a proper and proficient manner given that no conventional form of waterproofing had been installed (at [353][356]);
(c)inadequate waterproofing of the basement slab (at [359]); and
(d)the failure to insert an external water stop at the joint between the AFS wall and the basement floor amounting to a failure by Psaros Builders to carry out the regulated building service in a proper and proficient manner in that a vapour barrier was selected as the device to exclude water, thereby rendering additional sealing at the joint necessary and an external water stop was not provided (at [377][391]).
The Tribunal made two building remedy orders granting relief to the applicant. The first order was an order pursuant to s 36(1)(c) of the BSCRA Act requiring Psaros Builders to pay the applicant the amount of $76,477 being compensation in respect of costs incurred by the applicant in attempting to remedy the water ingress (at [394]). The Tribunal also made orders pursuant to s 36(1)(a) of the BSCRA Act requiring Psaros Builders to remedy the relevant regulated building service as specified in the order. In this regard there were various remedial options before the Tribunal by way of independent expert evidence. Ultimately the Tribunal accepted what was referred to in its reasons as 'remediation option 1' set out in Exhibit M which was proposed by the applicant's own expert, Mr Peter Airey.
Remediation option 1 provided for the installation of a secondary concrete floor slab 150 millimetres thick, overlaying the existing basement slab, together with a series of deep piles extending through the existing floor slab into the substrate. The option was intended to resist uplift from a rising water table and exclude water by the use of the concrete slab along with the sealing of all joints (at [225][226]). There were concerns raised before the Tribunal in relation to this option, in particular that any raising of the existing floor slab would create height clearance issues between the new ground floor level and the underside of the structure above (at [244]). However, the Tribunal ultimately preferred the evidence of Mr Airey in relation to this matter and accepted that any problems regarding headroom clearance had already been satisfactorily investigated by Mr Airey (at [245] and at [246]). Thus in effect the applicant contended for a particularised remedial order and was successful in obtaining it.
The orders made by the Tribunal were as follows:
1.The respondent must pay the applicant $76,477 within 28 days of the date of this order.
2.The respondent is to remedy the ingress of water into the basement carpark at Tyne Square in accordance with option 1 of the Joint Expert Recommendations dated 10 October 2012 within six months of the date of this order or such further date as the Tribunal orders.
3.Compliance with order 2 is subject to completion of a duly certified design by a structural engineer and written agreement to the certified design by the applicant.
4.Compliance with order 2 may require some development of option 1 to ensure compliance with all relevant laws, regulations and requirements, including, for example, minimum height requirements. If this cannot be resolved by agreement between the parties, each party has liberty to apply on seven days' notice.
5.The respondent is to make good areas affected by the remedial work.
(Original Order)
Psaros Builders appealed the decision of the Tribunal to the Supreme Court seeking leave to appeal on a single ground. In substance, the question of law was whether the Tribunal may order a respondent to pay compensation and to remedy a regulated building service where the BSCRA Act appeared to permit the Tribunal to make only one building remedy order. Although leave was granted the appeal was ultimately dismissed with Allanson J finding that the Tribunal may make more than one building remedy order where that is required to deal with the complaint: Psaros Builders Pty Ltd v Owners of Strata Plan 52843 [2014] WASC 34 at [43].
The dangers of an applicant, in the context of a complex building service complaint, seeking an overly prescriptive form of building remedy order, is that ultimately the proposed remedial approach either cannot be performed in the manner as specified and/or is insufficient to successfully remedy the underlying complaint. This of course leaves parties, particularly the applicant, in a precarious situation.
If a building remedy order cannot be performed because to do so would be unlawful, on strict terms it cannot be breached or converted pursuant to s 51 of the BSCRA Act. This is the situation that the applicant was faced with in this matter when it was ultimately discovered that remediation option 1 proposed by Mr Airey and accepted by the Tribunal failed to comply with the minimum head clearance requirements of the Building Code of Australia, as foreshadowed at the hearing but not accepted by the Tribunal. Perhaps at this juncture, the parties ought to have considered entering into a private agreement in respect of what remedial works ought to be performed and thus of necessity departing from the building remedy order made by the Tribunal.
Curiously, the parties did not proceed in that manner. Instead, it appears in 2015, some two years after the Original Order was made by the Tribunal, the parties returned to the Tribunal seeking by consent to vary the Original Order. I say curiously because it is unclear to me as to the legal basis on which the previously concluded proceeding could be reenlivened and how the final orders which had already been appealed to the Supreme Court could now be varied by the Tribunal. Although significantly out of time, there was certainly no application before the Tribunal pursuant to s 58 of the BSCRA Act whereby the applicant or respondent could seek internal review of the earlier decision of the Tribunal.
The Tribunal only has two other statutory sources of power enabling it to vary a final order. One is to correct a clerical mistake or accidental slip or omission pursuant to s 83 of the State Administrative Tribunal Act 2004 (WA) (SAT Act) often referred to as the 'slip rule'. This does not apply to the current circumstance.
The only other provision of the SAT Act which empowers the Tribunal to vary terms of a final order is s 56(3) of the SAT Act which allows the Tribunal with the consent of the parties to vary the terms of an order previously made by consent of the parties to settle the proceeding 'if such variation would reflect the intention of that original agreement'. This provision also did not apply because the order being sought to be varied was not an order made by the parties by their agreement to settle the proceeding.
This issue was raised with the parties at the hearing on 23 August 2018. It was submitted to the Tribunal that the matter was re-enlivened on the basis of order 4 made by the Tribunal on 5 April 2013. That order purported to give the parties liberty to apply on seven days' notice if some development of remediation option 1 was required to ensure compliance with all relevant laws, regulations and requirements and the matter 'cannot be resolved by agreement between the parties'.
I have reservations as to the power of the Tribunal to make an order in such terms. 'Liberty to apply' is ordinarily a term used by the courts which allows parties to bring a matter back before the relevant judicial officer to seek further programming orders during the course of the proceeding. Ordinarily 'liberty to apply' in relation to a final order is limited to matters concerning the implementation of the final order and would not extend to a substantive amendment of it (see in this regard Abigroup Ltd v Abignano (1992) 112 ALR 497 at 509 and also Wentworth v Woollahra Municipal Council (1983) (unreported, Court of Appeal, NSW, 31 March 1983)). In my view this purported application of 'liberty to apply' is well outside of this general application by the courts, even assuming that the Tribunal had such authority.
In addition, even accepting that 'liberty to apply' afforded the parties an opportunity for such a substantive variation to a final order, it could not have been invoked because it only applied in circumstances where the issue 'could not be resolved by agreement' of the parties. However, the varied order clearly evidenced that the parties did reach their own agreement as it was made with their consent at their joint request. This is made clear when one considers the terms of the varied order as follows:
On the application of the parties by Minute of Consent Orders dated 9 April 2015 and following a directions hearing on 9 June 2015, it is by consent of the parties ordered that:
1.Order 2 of the orders made by the State Administrative Tribunal dated 5 April 2015 be varied such that the respondent not remedy the ingress of water into the basement car park at Tyne Square in accordance with option 1 of the joint expert recommendation dated 10 October 2012, and instead remedy the water ingress in accordance with:
(a)The remedial solution described in:
(i)a report to the respondent from BG & E Structural Engineers, dated 11 August 2014; and
(ii)a Certificate of Design Compliance issued by BG & E Structural Engineers to the respondent dated 26 September 2014 and a letter from BG & E Structural Engineers to the respondent dated 28 October 2014.
(b)The remediation terms and conditions agreed between the parties as evidence by:
(i)a letter from Hotchkin Hanly to Squire Patton Boggs of 10 September 2014;
(ii)a letter from Squire Patton Boggs of 3 October 2014;
(iii)a letter from Hotchkin Hanly to Squire Patton Boggs of 27 October 2014;
(iv)an email from Hotchkin Hanly to Squire Patton Boggs of 15 December 2014 and responsive emails from Squire Patton Boggs to Hotchkin Hanly of 19 December 2014 and 13 January 2015 and;
(v)an email from Hotchkin Hanly to Squire Patton Boggs of 2 February 2015 and a responsive email from Squire Patton Boggs to Hotchkin Hanly of 17 February 2015.
2.Order 4 of the orders made by the State Administrative Tribunal dated 5 April 2013 be varied as such that the reference to option 1 be read as reference to the remedial solution described at Order 1 above.
3.On or before 3 July 2015 the applicant may file with the Tribunal and give to the respondent any application for costs they wish to make in respect of the matter.
4.On or before 24 July 2015 the respondent may file with the Tribunal and give to the applicant any submissions in reply to any application made by the applicant for costs.
5.Any decision on costs will be based on the submissions received in compliance with Orders 3 and 4 above and will be determined on the documents.
6.Apart for any decision on costs that may be necessary these orders are final in respect of all other matters connected to these proceedings.
(Varied Order)
What is clear from the above Varied Order is that it does not address minor matters concerning the implementation of the Original Order but is substantive in that the remediation option contained in the Original Order is revoked and substituted in its entirety with a remediation option proposed some years later by different experts. In addition the Varied Order is unclear. It refers to an alleged agreement reached by the parties evidenced by various correspondence exchanged between them, the terms of which are not themselves identified. It is therefore unclear whether the agreed terms and conditions were in fact orders that the Tribunal had jurisdiction to make pursuant to the BSCRA Act. In addition, the Varied Order has no date by which the new remedial works are to be completed. The Original Order of the Tribunal made on 5 April 2013 required compliance within six months, that is, by October 2013. The Varied Order identifies no new compliance date.
A last point worthy of noting is that Order 6 stated that other than any decision on costs the orders are 'final in respect of the matter'. This order was varied again by consent of the parties by the Tribunal on 21 August 2015 where Senior Sessional Member Clive Raymond made the following order:
1.Order 6 of orders made by Senior Member Maurice Spillane on 9 June 2015 be amended to:
(i)These orders are final in respect of all other matters connected to these proceedings.

For the reasons already provided above, I find there was no legal basis to make variations to final orders made by the Tribunal in 2013, either on 9 June or 21 August 2015. It is also unclear to me why the parties would consent to the order of 21 August 2015 and what they intended by it. Ultimately for the reasons already given I find that the orders made by the Tribunal on 9 June 2015 and 21 August 2015 are invalid because the Tribunal had no authority to make those orders.
However, whilst I find that the orders are legally invalid it does not necessarily flow that they have no legal effect because at all relevant periods the parties never sought to take any action to set them aside or to have the orders declared to be invalid (in this regard reference is made to Le Miere J in Tulloh v Chief Executive Officer of the Department of Corrective Services [2018] WASC 105 [21]-[28]). Rather, they have acted entirely consistently with the terms of the Varied Order on the unchallenged assumption that the order was legally binding and valid. That fact is relevant to the current determination as part of the factual matrix to which I must have regard. The legal invalidity of the Varied Order itself will of course have no consequence now given that no further applications can be made in respect of it (for example either an application pursuant to s 51 or s 58 of the BSCRA Act).

Relevant background facts to current complaint

It is not in dispute between the parties that Psaros Builders carried out the regulated building service in respect of which the original complaint was lodged by the applicant in 2012. The relevant regulated building service reached practical completion in or about midlate 2009.
Despite orders being made by the Tribunal on 5 April 2013 it appeared that no remedial works were commenced by Psaros Builders for a period of two years.
During 2014 to early 2015 the applicant and Psaros Builders entered into negotiations with the intention of agreeing an alternative remedial solution to that which had been encapsulated in the building remedy order made by the Tribunal on 5 April 2013. That agreement was negotiated between the applicant and Psaros Builders over a number of months and delved into significant detail. The ultimate agreement reached by them was evidenced by a number of letters, expert reports and emails. The negotiated agreement reached, as referred to in the Varied Order, is important factual background to the current determination and therefore I have set out relevant excerpts below.
Order 1(b)(i) of the Varied Order refers to a letter from the applicant's solicitor to the solicitors representing Psaros Builders dated 10 September 2014. That letter in part stated the following:
Dear Sir
OWNERS OF STRATA PLAN 52843 v PSAROS BUILDERS PTY LTD
…
The Alternative Solution
…
Our client is willing to consider the suitability of the alternative solution your client has now produced however it reserves all its rights as regards the costs it has incurred having its structural engineers liaise with Brown Consulting over the past 12 months.
The alternative solution now proposed has been raised and put forward by your client on the basis that it offers a less intrusive solution which will provide a reasonable and effective means of addressing the concerns of the owners and tenants of Tyne Square, that were ventilated during the course of the SAT hearing in 2012. We note that the alternative solution now posited by your client was not raised during the course of the hearing before the SAT on 8, 9, 11 and 12 October 2012, and 6 and 7 December 2012.
Issues Arising from 18 August 2014 proposal
Our client is currently considering your client's proposal in the most timely and cost effective way to arrange a review of the design now produced by BG & E Engineering. Whilst that process is being undertaken we seek your client's response to the following matters that arise from the proposal made by your client:
…
2.We refer to the construction management program found at attachment 6 of your 18 August 2014 letter. Could you please have your client address the following issues:
(a)Please confirm that your client will undertake all remedial works described in its proposed solution at its cost;
(b)Please confirm that no services to the building will be suspended during the course of the remedial works including water, power, gas, telephone, data cabling and sewer;
(c)Item 6.6 refers to waterproofing. Please confirm that the process of waterproofing so as to achieve a fully tanked basement will include all the areas being treated in the last revision of the Airey Taylor/ETEC drawings and up to the same height as is shown in those drawings; and
(d)Please advise who the specialist waterproofing subcontractor is that has developed a design to waterproof the existing joints to the car park basement and who will undertake the work, as referred to at item 6.6 of the construction management plan; and
(e)Please provide a copy of the design document produced by your client's waterproofing subcontractor so our client may review it.
3.Please provide a copy of the construction program that your client intends to work to during the course of the remedial works.
4.Please advise whether your client will compensate the owners for car parking and storage costs that they may incur as a result of the remedial work to be undertaken by your client.
5.We understand from your proposal that your client will require blocks of ten car bays at various periods of time to undertake the work. Please provide a proposed program in respect of the car bays that would be needed so that our client can liaise with individual owners regarding access to their cars and car parking as necessary.
6.Please confirm that both cars and trucks that are required to access the retail shops may continue to use the driveway between Lindsay and Beaufort Street with minimal disruption during the course of the remedial works. Please also confirm that the car parking at ground level (all 54 bays) will remain available for use by the commercial premises.
7.As the retail shops in the building will continue to trade after your client has finished its work for the day, could you please confirm that any traffic guidance equipment used during the course of the day will be removed each night at the closure of the work shift. Further, if there are days where traffic management devices are not required, then the devices will be removed altogether on those days. Please confirm that your client will ensure that the delivery and dispatch of goods and rubbish/waste for the remedial works will be performed outside of peak trading hours for the commercial tenants of the building, being between approximately 11:00am to 3:00pm, and 5:00pm to 7:00pm daily. We are advised that the best time for your client to undertake truck movements to and from the site will be from 8:00am to 11:00am due to the deliveries of milk and bread to IGA at 7:00am.
8.Please confirm that any structural engineering engaged by the owners will be permitted to progressively review the remedial works being undertaken on reasonable notice to your client.
9.Please confirm that your client will not arrange deliveries to site before 7:00am and after 10:00pm on weekdays.
10.Please confirm that your client or its subcontractors will not park any vehicles or keep any site huts, buildings, structures, equipment or materials on the ground floor car parks or roads surrounding the building during the time that the remedial works are being undertaken.
11.Please confirm that the pumps and lines currently in place in the car park basement shall remain connected and operation during the duration of the remedial works;
12.Our client wants there to be a clear understanding of where liability lies in the event the alternative solution proposed by BG & E Engineers is not effective. Our client proposes that yours provide on express written warranty that the remedial works to be performed by your client are suitable and fit for the purpose of resolving both the structural issues with the car park basement slab and the water ingress issues. Such a warranty would have the effect of allowing our client recourse against yours in the event there was a failure in either the design of the remedial works, or the construction of the remedial works. If your client is not prepared to provide such a warranty, please advise us what it proposes as an alternative.
…
Documenting the arrangement
We note your client's view that a formal legal agreement by deed is unnecessary to regulate the rights of the parties during the remediation process, and your client's preference that the process be agreed by an exchange of correspondence. Our client is willing to consider this suggestion subject to your client entering into an appropriately worded consent order to be filed with the SAT which has the effect of varying the orders made by the SAT on 5 April 2013 such that the remedial work contemplated by Order 2 of the 5 April 2013 orders refers to the BG & E alternative solution as well as the specialist waterproofing works to be undertaken by your client's subcontractor. This is subject to our client firstly agreeing to the alternative solution proposed by BG & E. Please advise whether your client is in principle willing to enter into consent orders to this effect.
…
Yours sincerely
HOTCHKIN HANLY
Andrew Buchan
Partner
(Applicant's Bundle)

The representative of Psaros Builders responded to this letter on 3 October 2014. Relevant excerpts from that correspondence are set out below:
Dear Andrew
Owners of Strata Plan 52843 and Psaros Building Pty Ltd
We refer to your letter dated 10 September 2014.
…
2Construction Management Program
(a)Our client confirms that the Remedial Works Solution will be undertaken at its own cost.
(b)Our client .confirms that no services to the building will be required to be suspended during the course of undertaking the Remedial Works Solution.
(c)Our client confirms that the areas that require waterproofing to achieve a fully tanked basement will include all areas being treated in the last revision of the Airey Taylor/ETEC drawings and up to the same height as shown in those drawings.
(d)Mr Greg Crocker of Allduro developed the waterproofing design on behalf of the manufacturer of the waterproofing product. Mr Darius Amin of Concrete Coating and Repairs will undertake the waterproofing treatment.
(e)Allduro's design has already been provided with our letter of 18 August 2014. If more detail or further explanation is required, Greg Croker is available to meet with the newly appointed engineer.
3Please find a copy of our client's proposed construction program enclosed.
4Our client has access to 10 car bays in 'The Mews' that your client may use and our client will pay Wilsons' for the costs. In relation to storage costs, our client proposes that any contents in the storerooms are emptied by the occupants and stored within their apartments.
5Our client's proposed program regarding access to the car bays is included the enclosed construction program. The construction program should be considered in conjunction with the attached marked-up drawing of the basement.
6Our client confirms that any cars and trucks required to access the retail shops may continue to use the driveway between Lindsay and Beaufort Streets with minimal disruption while the Remedial Works Solution is being undertaken. Ground level car parking will also remain available for use by the commercial premises.
7Our client confirms that any traffic guidance equipment used during the day will be removed each night at the end of the work shift and that the delivery and dispatch of goods, rubbish and waste for the Remedial Works Solution will be performed outside of the commercial tenants' peak trading hours at the building.
8Our client confirms that any structural engineer engaged by your client will be permitted to progressively review the remedial works being undertaken upon reasonable prior written notice to our client.
9Our client confirms that it will not arrange deliveries to the site before 7:00am and after 10:00pm on weekdays.
10Our client confirms that neither it nor its subcontractors will park any vehicles or keep any of the items referred to in your letter on the ground floor car parks during the time the Remedial Works Solution is being undertaken. However, our client cannot restrict its employees or subcontractors from parking in public car spaces in the roads surrounding the building.
11Our client confirms that the pumps and lines currently in place in the car park basement will remain connected and operational while the Remedial Works Solution is being undertaken.
12Our client is unable to provide the design warranty proposed. BG&E have provided the attached revised certificate of design compliance. The certificate is in favour of our client. BG&E was unable to agree to our clients request to provide the certificate in favour of your client for insurance reasons. However, BG&E's design is being verified by Airey Taylor and accordingly if the design is deficient your client will have recourse rights against Airey Taylor. Our client will warrant that the construction of the Remedial Works Solution will be in accordance, with the approved BG&E design. Our client considers the involvement of two expert engineers in the design of the Remedial Works Solution, mitigates the risk relating to its effectiveness.
…
Documenting the arrangement
Can you please provide, the wording of your clients proposed consent orders. Our client is unable to agree in principle or otherwise with consent orders before reviewing the orders proposed. Please confirm why your client feels it is necessary to have any further substantive SAT orders when the agreement between our clients will be binding and enforceable.
…
Yours faithfully
Squire Patton Boggs (AU)
(Applicant's Bundle)
The representative of the applicant then responded by way of letter dated 27 October 2014. Relevant excerpts of that correspondence are set out below:
Dear Sir
OWNERS OF STRATA PLAN 52843 v PSAROS BUILDERS PTY LTD
CC 602 OF 2012
Thank you for your letter of 3 October 2014. Our client has instructed us that it is agreeable to the basement remedial works proceeding in accordance with the BG & E design and on the basis of those matters described in paragraphs 2 - 12 of your 3 October 2014 letter, subject to the following matters:
1.At paragraph 4 - it is proposed by your client that the contents of the store rooms are emptied by the occupants and stored within their apartments. Our client will liaise with individual unit holders regarding this proposal, however the strata body cannot bind individual unit holders to this proposal, and in the event that individual owners incur storage costs due to their apartments not being suitable to store the contents of the store rooms, then those individual unit owners may seek to recover those storage costs from your client.
2.At paragraph 12 - you indicate that your client is unable to provide the design warranty proposed by our letter of 10 September 2014. Our client does not accept that your client is exempt from liability in respect of design risk and reserves all its rights in relation to any failure of the remedial works, including as to design. Would you please confirm that the BG & E Certificate of Design Compliance dated 26 September 2014 is made out to Psaros Builders Pty Ltd. and it is Psaros Builders Pty Ltd that will be undertaking the basement remedial works.
…
4.We enclose a draft of the SAT consent orders that our client requires your client to enter into prior to the remedial works proceeding. Given your client's view that it is unnecessary for a formal deed of agreement to be entered into between the parties to regulate the remediation process, then the attached consent orders will provide our client with the necessary security that it can seek recourse in the SAT in the event that the remedial works do not proceed as agreed. The entry into the proposed consent orders does not place additional or more onerous obligations on your client. In fact, the making of these orders substantially improves your client's position given the remedial works they contemplate are likely to be both less expensive, and less time consuming than the option 1 solution ordered by the SAT in its 5 April 2013 orders.
…
Our client is willing to allow remedial works to commence after the issues described at paragraphs 2, 4 and 5 above have been addressed and we look forward to your early response.
Yours sincerely
HOTCKIN HANLY
Andrew Buchan
Partner
(Applicant's Bundle)
Following the exchange of these substantive letters there were emails passing between the solicitors representing the applicant and Psaros Builders over the next few months primarily fine tuning the details of the substantive agreement already reached. What is worthy of noting at this stage is that the agreement reached between the applicant and Psaros Builders was extremely detailed, and it was clearly viewed by the parties as binding (as evidenced by the above excerpts). What is also apparent from the exchange of correspondence is that the applicant insisted on the parties agreeing to consent orders in order to provide the applicant with 'the necessary security that it can seek recourse in the SAT in the event that the remedial works do not proceed as agreed'.
At the time that the parties attempted to vary the Original Order, Psaros Builders had applied for a building permit with the City of Vincent to perform remedial work to the basement of Tyne Square (para 5 of the parties' agreed facts). However, its registration as a building service provider had expired and had not been renewed (paras 6 and 7 of the parties' agreed facts). Therefore as at the time of the Varied Order the works were arranged to be performed by the respondent, who did have a valid registration as a building service provider at the relevant time. The new works identified by the Varied Order included the use of ground anchors and pins and specialist waterproofing work.
On 18 May 2015 a building permit for the basement remedial works was issued to the respondent. From May 2015 onwards the respondent took steps to perform the remedial works in compliance with the Varied Order (para 12 and 13 of the parties' agreed facts).
On or about midMarch 2016 the respondent issued a notice of completion in respect of the remedial works (para 14 of the parties' agreed facts).
As reflected by the agreement reached by the applicant with Psaros Builders, which required the remedial works to be undertaken at the sole cost of Psaros Builders, Psaros Builders was invoiced in respect of the remedial works undertaken by the respondent on 29 September 2015 in the amount of $496,268.88 (document number 8 in the parties' agreed bundle).
During winter of 2016 the applicant contacted the respondent to advise that water ingress was continuing into several areas of the basement. In July 2016 the respondent attended and undertook further remedial works of an unknown nature (para 16 of the parties' agreed facts).
On 7 August 2016 Psaros Builders was deregistered by the Australian Securities and Investments Commission (para 17 of the parties agreed facts).
The parties agree that between October 2015 and November 2016 Mr Andrew Sutton of the respondent advised the applicant by email that the remedial works being performed would be subject to an ongoing six year rectification period and stated the following:
(a)On 13 October 2015 Mr Sutton sent an email to the applicant stating: 'Psaros will then stand by these works for a period of 6 years as per normal obligations under a construction contract'.
(b)On 6 November 2015 Mr Sutton sent the applicant an email stating: 'Psaros confirm that the 6 year period for the SAT rectification works in this room, and all other areas that the SAT scope of works covered, would be honoured'.
(c)On 8 November 2016 Mr Sutton sent the applicant an email in response to an email from Mr Andrew Spain, from the Tyne Square Strata Management Company. Mr Spain's email stated: 'It is the strata Companies understanding that the period for which Psaros is responsible for the defects for all works completed under Building Permit number 6.2015.200.1 as enforced by the SAT Order for a period of 6 years resets from the date of which the current remedial works are completed'.
(d)Andrew Sutton replied: 'Your understanding is correct regarding this' (para 21 of the parties' agreed facts).

On or about 21 July 2017, the respondent's waterproofing subcontractor attended the premises and undertook further waterproofing remedial works. However, water ingress to the basement carpark continued to occur and worsen in late July and early August 2017 (paras 22 and 23 of the parties' agreed facts).
On 1 August 2017, Mr Robert Sansalone of the respondent informed the applicant that the registered builder of Tyne Square, Psaros Builders, was deregistered. However, due to Psaros Property Group Holdings reputation, Mr David Bohan from the respondent would attend a meeting without prejudice in good faith to attempt to resolve ongoing water ingress issues (para 24 of the parties' agreed facts).
On 11 August 2017 in response to requests from the applicant to undertake further remedial work, Mr Sansalone sent an email in regard to engaging Apartment Maintenance Services Pty Ltd (AMS) to investigate water ingress and stated 'in doing so, neither AMS nor any Psaros entity accepts or assumes liability or responsibility. The proposed action is limited to the present issue only and has no bearing on the underlying cause of the issue or liability or responsibility for that cause' (para 25 of the parties' agreed facts).
Further on 16 August 2017 Mr Sansalone sent the following email to the applicant (para 26 of the parties' agreed facts):
Dear Adrian
…
Psaros Pty Ltd, the contractor engaged to carry out the works to the basement will only be responsible for the workmanship of the works performed. In this case, in consultation with our waterproofing supplier, Psaros request access again to determine the extent of any installed waterproofing workmanship issues with the purpose to rectify any workmanship issues discovered.
As communicated previously, Psaros group of companies (Psaros) advises that the builder of Tyne Square was Psaros Builders Pty Ltd which no longer exists and has been deregistered since August 2016.
While Psaros has in good faith and of its own volition attended to some building issues since Psaros Builders Pty Ltd has been deregistered, it feels that the time has come to cease providing ex gratia assistance, particularly given the time that has expired since the building was completed and the completion of certain agreed remedial solutions.
Psaros is not responsible or liable to rectify any defects in the building that became apparent before the date of this email, or will become apparent afterwards, and has not accepted nor assumed, and will not accept or assume, any such responsibility or liability.
…
Regards
Robert Sansalone
Director Construction Administration

Issue for determination

The issue for determination by the Tribunal is as follows:
(a)Who carried out the regulated building service comprising the relevant remedial work?
Although not a separate issue in and of itself, the Tribunal needs to consider the above issue in the context of a building remedy order issued against a particular entity and the significance of the existence of such an order in the factual context of that entity engaging a registered building service provider to perform the works on its behalf.
It ought to be revisited at this point that there was a degree of lack of clarity, when the applicant's complaint in this proceeding was initially referred to the Tribunal, as to the exact nature of the complaint itself. As already mentioned at [1], the complaint identified the location as being the 'basement carpark to building' and the description of the complaint as being 'water ingress to six separate areas of carpark' with the remedy being sought being 'remediation to stop water ingress'. Although the complaint lodged with the Building Commissioner annexed letters from the applicant's representative to the respondent's representative dated 25 August 2017 and 8 February 2018, those letters failed to provide further clarification as to the exact nature of the complaint itself but rather provided historical information in relation to the dispute. The Tribunal therefore initially interpreted the complaint as being identical to that lodged with the Building Commission in 2012. That is, a complaint in respect to the original construction of Tyne Square.
When the Tribunal received the applicant's written submissions on 29 May 2018 they did little to address this particular issue. The Tribunal was therefore grateful when the applicant's representative wrote on 20 July 2018 requesting liberty to provide oral submissions to the Tribunal.
The Tribunal took the opportunity to email the parties on 8 August 2018 to raise two matters that the Tribunal wished to hear from the parties on as follows:
Dear Parties
The Tribunal wishes to raise two matters with you for your consideration and submission at the upcoming hearing.
Firstly, as a significant matter, the Tribunal notes that the applicant has as yet failed to identify the specific regulated building service, of which they complain. The complaint at the present time simply refers to the symptom of the complaint, that is of water ingress. It does not identify what the regulated building service is, in respect of which it seeks the Tribunal to determine was carried out in a manner which was not proper and proficient or which is faulty or unsatisfactory.
As a second matter, the Tribunal's view is that the agreed outline of facts is incomplete in that it does not identify the legal basis on which the parties approached the Tribunal in 2015 and on which the Tribunal made the 'Varied Orders'. At the present time the Tribunal cannot identify any legal basis on which that occurred.
The Tribunal would be grateful if these matters could be addressed at the hearing.
The Tribunal then received correspondence from the applicant's representatives on 15 August 2018 which, for the first time, identified that the complaint was in fact in respect to alleged defective remedial work and in particular an alleged failure by the respondent to perform waterproofing works in a proper and proficient manner to the joints, cracks and holes in the basement slab as required by the approved plans attached to the relevant building permit, such that water ingress was occurring to the basement carpark. The letter attached a report prepared by DATS Sealed by way of supportive expert evidence.
The clarification of this issue was of course essential to the determination by the Tribunal as to who carried out the relevant regulated building service. Unfortunately the respondent had also proceeded on the basis that the regulated building service being complained of was the original construction and not the remedial work. Thus, the earlier submissions filed on behalf of the respondent simply did not address the question as to whether it had 'carried out' the remedial work for the purposes of s 5(1) of the BSCRA Act. On this basis the most recent written submissions filed by the parties are of most relevance to the determination of the preliminary issue.
Although the respondent appeared to contest whether the applicant's complaint could be interpreted as a complaint in respect of remedial work, and more specifically waterproofing remedial work, I indicated at the hearing on 23 August 2018 that the Tribunal's position is that it does not take an impractical literal interpretation of complaints but rather must interpret the complaint in a substantive broad brush manner. I indicated to the parties that I was comfortable in accepting that the applicant had intended to make a complaint about the remedial work itself rather than re-agitating the same complaint which had been made by the applicant in 2012.
Applicant's position
The applicant's position, applying the principles set out in the decision of Shami and Teo [2017] WASAT 73 (Shami) is that the Tribunal ought to find that the respondent carried out the regulated building service for the following reasons:
(a)The building permit which appended approved plans describing the remedial work to be performed was issued in the name of the respondent (document 6 of the parties' agreed bundle). That work included the installation of a waterproofing system to joints, cracks and holes in the basement slab in accordance with a waterproofing specialist subcontractor's details and specification.
(b)The respondent engaged and paid sub-trades to perform that work (para 13 of the parties' agreed facts).
(c)The respondent was the registered building service provider to whom the building permit was issued (Shami at [56]) and engaged, supervised and controlled subcontractors employed to perform the remedial works.
(d)Psaros Builders did not perform any element of the works nor did it have a supervisory role. It was not a registered building service provider at the relevant time.
(e)The respondent by entering into an arrangement to perform the entirety of the remedial works and by carrying out those works as the registered building service provider accepted ongoing responsibility in respect of the works (Shami at [47][48]).

Respondent's position

As mentioned above, initially the respondent appeared to contest whether the complaint was in substance a complaint in respect of the performance of remedial work in relation to waterproofing. However, it appears to have conceded the point in light of the written submissions filed with the Tribunal dated 6 September 2018.
In relation to which entity carried out the regulated building service for the purposes of the BSCRA Act the respondent, in summary, submits the following:
(a)On 5 April 2013 the Tribunal made the Original Order compelling Psaros Builders to remedy water ingress to the basement carpark of Tyne Square.
(b)The Original Order was incapable of compliance and thus over a number of months during 2014 and 2015 the applicant and Psaros Builders negotiated an alternative remedial solution evidenced by correspondence and reports exchanged between them and ultimately formalised in the Varied Order made by the Tribunal on 9 June 2015. Psaros Builders was actively involved in the negotiations and ultimately reached a binding agreement with the applicant.
(c)Although the building permit was initially applied for by Psaros Builders, it was ultimately obtained by the respondent. The respondent was engaged by Psaros Builders to perform the works required by the Varied Order on the basis that the builder's registration of Psaros Builders had lapsed and it could not retain the building permit in the circumstances.
(d)Psaros Builders engaged the respondent pursuant to a financial arrangement to perform the works that it had negotiated and agreed to perform for the applicant. The cost of the works was not insignificant totalling $496,268.88 (document 8 of the parties' agreed bundle).
(e)When the notice of completion was filed in respect of the remedial works, Psaros Builders was deregistered three months later. The company did not seek deregistration whilst the remedial works were on foot.
(f)As per Shami at [48], it is not the elements of work itself which is the building project, but the entire project on a global basis. In applying the principles identified in Shami, the building project in the present case is the work the subject of the Varied Order. The remedial work was carried out in order to satisfy the Varied Order.
(g)A large part of the building project as evidenced by the Varied Order was the detailed negotiation, development, agreement and implementation of an overall design and construction program in respect to the alternative remediation solution. All of those elements were negotiated and agreed in detail by Psaros Builders. The respondent had no involvement in any of those crucial elements and merely had to perform them.
(h)Psaros Builders was the entity against whom the Varied Order was made and was therefore responsible for ensuring that the building project was carried out and completed. But for the Original Order and the Varied Order the respondent would not have been retained by Psaros Builders to perform the remedial works.
(i)Adopting the reasoning from Shami that the phrase 'carried out' means 'the completion of the entirety of the building work', Psaros Builders 'carried out' the whole of the 'building project', from when the Original Order was made in 2013 until it was deregistered in August 2016.
(j)But for the deregistration of Psaros Builders, the applicant would have made an application pursuant to s 51 of the BSCRA Act on the basis that Psaros Builders carried out the regulated building service. It is disingenuous of it now to contend that the respondent carried out the remedial works simply because the opportunity to initiate an application against Psaros Builders is no longer available.

Who carried out the regulated building service in respect to the remedial works?

The decision in Shami is the leading authority in respect of the question as to who carried out a regulated building service for the purposes of the BSCRA Act. In particular, the following paragraphs at [39]-[48] are particularly useful and are therefore set out in full below:
39As has already been stated, the provisions of s 37(1) and s 38(1) of the BSCRA Act are similar. They give the Building Commissioner and the Tribunal respectively the power to make a building remedy order in accordance with s 36(1) of the Act if the regulated building service that is the subject of a building service complaint has not been carried out in a proper and proficient manner or is faulty or unsatisfactory. The words 'carried out' appear in each of those subsections.
40In Diploma Construction (WA) Pty Ltd v South Central WA Pty Ltd [2015] WASC 289 (Diploma Construction), Mitchell J, in the course of considering the proper construction of s 38(1) of the BSCRA Act, referred to the case of Bradshaw v McGuire (unreported, WASC, Library No 6260, 30 April 1986 (Bradshaw) and made the following relevant comments:
…
45Prior to the enactment of the [BSCRA Act], complaints about unsatisfactory building work were the subject of s 12A of the [Builders' Registration Act]. Section 12A enabled a complaint to be made that 'any building work has not been carried out in a proper and workmanlike manner by reason that the building work is faulty or unsatisfactory'. When a Disputes Tribunal (and at an earlier time, a Board) was satisfied of this matter under s 12A(1) of the [Builders' Registration Act], it could order the person who carried out the work to remedy the faulty or unsatisfactory building work.
…
47The operation of s 12A(1) of the Builders' Registration Act, as it stood in 1986, was considered by a Full Court comprised of Burt CJ, Wallace and Pigeon JJ in [Bradshaw]. …
…
50Wallace J observed:
… a builder is responsible to the building owner for faulty workmanship carried out by subcontractors … I agree with what Pidgeon J had to say thereon in Shaw v McLeod. (citation omitted)
51Pidgeon J said:
… It would, in my view, be an erosion of what the legislature intended by s 12A for a builder to escape the jurisdiction of the Board by submitting that the work complained of was not within the builder's specialty and had been done by a specialized subcontractor. …
52In Bradshaw … [the] argument that a builder does not 'carry out' work for which he engages a contractor was also rejected.
53The similarity between the language of s 12A(1) of the Builders' Registration Act and s 38(1) of the [BSCRA Act] strongly suggests that the substituted provision is intended to operate in a similar manner to that established for the repealed provision. …
…
55… Regard may be had to the explanatory memorandum to identify the purpose of the provisions, and a construction which promotes that purpose preferred, pursuant to s 18 and s 19 of the Interpretation Act 1984 (WA).
41As referred to above, the operation of s 12A of the Builders' Registration Act was also considered in Shaw v McLeod (unreported, WASC, Library No 4707, 8 November 1982) (Shaw), which was an appeal from the decision of a Magistrate that the appellant had failed to comply with an order made under s 12A. One of the grounds of appeal was that the appellant was not the person 'who carried out the building work' within the meaning of that term in s 12A. Pidgeon J in Shaw, at 11, said:
[The Magistrate] considered the charge was validly brought against the accused and gave the following as his reasons:
'I consider that in referring to the person who "carried out the building work" s12A(1) of the [Builders' Registration Act] is referring specifically to the person responsible for the building of the edifice whatever it may be. I do not consider that it is the specific bricklayer, carpenter, plumber or such other tradesmen as actually did the work who is that person …
My reading of the [Builders' Registration Act] as a whole leads me to the same conclusion as the learned Magistrate and that the person referred to as being the person 'who carried out the building work' would not be the subcontractors engaged. The person who physically carries out the work may not even be the subcontractors and could well be a bricklayer on wages or a builder's labourer. It could not have been the intention of the [Builders' Registration Act] that the [order] goes to such person. I consider that the words 'building work' in s.12A is the whole work the subject of the contract which normally would be the work in respect of which the permit issues or what his Worship describes as 'the edifice'[.]
42The case of Voce v Watson (1989) 89 ACTR 1 (Voce) dealt with the proper construction of a regulation which imposed a duty on any person who 'carries out any building work' to take safety measures to prevent injury to persons engaged in the building works. Kelly J, at 7, referred to the intended meaning of the phrase 'person who carries out' as being:
… a person who, in effect, has the role of ensuring that the necessary building work is performed normally to its completion either by himself or by his servants or agents. It does not … mean that every person who is actually performing any of the building work in question 'carries out' such building work[.]
43Then Kelly J, went on to state in Voce, at 9:
When one turns to the meaning given the phrase 'carry out' in the Shorter Oxford Dictionary one finds that the relevant meaning is 'to conduct to conclusion'. This meaning may not, of course, be entirely applicable in respect of a partly completed building, but obviously in completing such a building the person concerned with the building work is carrying out the necessary building work from the beginning of the works upon which he is engaged.
44The meaning given to the phrase 'carry out' in the Macquarie Dictionary Online (2017) is 'to accomplish or complete (a plan, scheme, etc.)'. That is similar to the meaning given to the phrase in the Shorter Oxford Dictionary referred to by Kelly J in Voce.
45The Tribunal agrees with the view expressed by Mitchell J in Diploma Construction that the similarity between the language of s 12A of the Builders' Registration Act and s 38(1) of the BSCRA Act (and hence also s 37(1) of the BSCRA Act), strongly suggests that s 37(1) and s 38(1) are intended to operate in a similar manner to that established for s 12A.
46Therefore, in construing the phrase 'carried out' in s 36(1) and s 37(1) of the BSCRA Act, the Tribunal adopts the approach taken by Wallace and Pidgeon JJ in Bradshaw and by Pidgeon J in Shaw regarding the construction of the phrase 'carried out' in s 12A of the Builders' Registration Act and also the approach taken by Kelly J in Voce regarding the construction of the phrase 'carries out' in the regulation considered in that case.
47Accordingly, the Tribunal has decided that the proper construction of the phrase 'carried out' in s 36(1), s 37(1) and s 38(1) of the BSCRA Act is that it means the completion of the entirety of the building work of which the work the subject of a building service complaint forms part. That entirety of work could be described as 'the building project'. In the case of the construction of an entire building the building project will be the construction of the 'edifice' referred to in Shaw. In other cases the building project could be the completion of a building after it has reached a certain stage, or the alteration, improvement or repair of a building.
48For the purposes of s 36(1), s 37(1) and s 38(1) of the BSCRA Act, it is the entirety of the work of the building project which is carried out, not the components of it. What follows from that construction is that a building remedy order can only be made against the person who had the role of ensuring that the entire building project which includes the work which is the subject of a building service complaint was 'carried out', or in other words 'brought to completion'. It does not matter whether the work was done personally by that person or by other persons whom they arranged to perform the various components of the overall work. However, it needs to be noted that for a building remedy order to be made against that person the building project must be a 'regulated building service' as defined in s 3 of the BSCRA Act.

It is clear from the decision of Shami that it is not necessarily the entity that undertakes the mechanics of the work which is the entity who carried out the regulated building service. It is the entity who is ultimately responsible for the overall building project that is the entity which carried out the building service.
It is not unusual that in circumstances where a building remedy order has been made against one party, that that party arranges for a different entity to perform the relevant works. This often happens in circumstances where that entity was never or is no longer a registered building service provider. In such circumstances it is clearly appropriate in respect of works which are required to be performed by a registered building service provider that the party arranges someone else to perform those works. Section 36(3) of the BSCRA Act supports this position.
In my view, all remedial works performed up until the date of notice of completion were carried out, for the purposes of the BSCRA Act, by Psaros Builders for the following reasons:
1)Psaros Builders was the legal entity ordered to perform remedial work by the Tribunal on 5 April 2013 pursuant to the Original Order and subsequently by the Varied Order. The Varied Order was consented to by Psaros Builders. The Varied Order evidences an exchange of correspondence between the applicant and Psaros Builders by which they reached agreement in respect to the terms and conditions of the performance of that work.
2)In circumstances where the registration of Psaros Builders as a building service provider had expired it clearly needed to arrange for a separate entity to undertake the mechanics of the remedial works.
3)Pursuant to the terms of the Varied Order whereby Psaros Builders confirmed that 'the remedial work solution will be undertaken at its own cost' it was invoiced in the amount of $496,268.88 by the respondent on 29 September 2015 in respect of those works.
4)The exchange of correspondence between Psaros Builders and the applicant during late 2014 and 2015 evidences a written agreement of terms and conditions upon which the remedial works would be performed. The respondent was not a party to that agreement and there is no evidence of any novation of the agreement to the respondent.
5)At all relevant times Psaros Builders accepted that as a result of the Varied Order made by the Tribunal that it had legal responsibility for the performance of the remedial works. This is supported by it only taking action to deregister following a Notice of Completion of remedial works being issued to the applicant.
6)There is no evidence of any conduct contrary to the position that Psaros Builders was acting pursuant to its legal liability to arrange for the remedial works to be performed.
7)Emails sent from a project manager of the respondent are insufficient to bind the corporate entity such that it can be contended that it assumed legal responsibility, for the purposes of the BSCRA Act, for the Varied Order and the works undertaken pursuant to it. Any such assumption of legal liability could only be evidenced by a clear novation of what appears to be a binding agreement entered into between Psaros Builders and the applicant.
8)But for the Original Order of the Tribunal made on 5 April 2013 and the Varied Order in June 2015, no work would have been performed by the respondent. It did so as arranged by Psaros Builders due to the legal liability for it to perform that work, not due to any legal liability of the respondent.
When one properly applies the principles set out in Shami, the Tribunal could never reach a conclusion that the respondent carried out the regulated building service, being the remedial works in respect of waterproofing at Tyne Square. Psaros Builders would never have arranged for the respondent to undertake the mechanics of the works but for the legal compulsion placed on it.
Psaros Builders came to the situation reluctantly as many parties do following a long and contested hearing at the Tribunal. It then participated in months of negotiations in significant detail ultimately agreeing an alternative remedial solution. As part of those negotiations it agreed to perform the works solely at its cost. Such agreement would never have been reached but for legally enforceable orders against Psaros Builders requiring it to perform the remedial works. The fact that it ultimately arranged for another entity to obtain the building permit and undertake the works in line with what it had agreed with the applicant is really immaterial. Many entities the recipient of building remedy orders make similar arrangements particularly in circumstances where they are not a registered building service provider. Third parties would refuse to perform such works if it was understood that they would essentially step into the shoes as respondent in concluded Tribunal hearings.
Indeed, if one accepted the contention of the applicant, project managers would evade responsibility by engaging a registered builder to perform work according to their agreement with a client. Such a conclusion ignores all that is set out in Shami. Shami very clearly states that the mechanics of the work is not what ultimately persuades the Tribunal when determining who carried out the overarching building project. That determination must occur at a higher level with a focus on over-all responsibility for the building project itself.
These propositions were put directly to the applicant's legal representative at the hearing on 23 August 2018. In my view, it was disingenuous of the representative to submit to the Tribunal that the existence of a building remedy order was irrelevant to the question as to who carried out the regulated building service (ts 16, 23 August 2018). With all due respect to the applicant's representative, it is nonsensical to suggest that the existence of a legal compulsion to perform the works is irrelevant to the determination as to who carried out the regulated building service being the very works the subject of those orders.
Similarly, the contention of the applicant's representative that any legal responsibility was 'assumed' by the respondent by applying for a building permit (ts 17, 23 August 2018) is simply unsupported at law. The respondent was a registered building service provider who was retained to perform work in specific terms in accordance with an agreement reached between the applicant and Psaros Builders and it performed those works, charged for the works, and was ultimately paid for the works by Psaros Builders.
The applicant's representative initially was reluctant to concede the point that but for Psaros Builders being deregistered, the applicant would have initiated a s 51 application against it. I pressed the issue a number of times at the hearing because I wanted the applicant to have a fair opportunity to persuade me of their position (ts 4, 23 August 2018). Eventually the applicant's representative conceded that it would be disingenuous to suggest that Psaros Builders no longer being available was not 'critical' to the decision made to pursue the respondent in the current proceeding (ts 22, 23 August 2018). In my view, this fact was not only critical to the decision to pursue the respondent in this proceeding but was the only reason why the complaint was agitated. This position is supported when one considers the exchange of correspondence between the applicant and Psaros Builders in 2014 and in particular the applicant's legal representative's letter of 27 October 2014 at para 4 page 2 where he states:
Given your client's view that it is unnecessary for a formal deed of agreement to be entered into between the parties to regulate the remediation process, then the attached consent orders will provide our client with the necessary security that it can seek recourse in the SAT in the event that the remedial works do not proceed as agreed.
The security insisted upon and referred to in the correspondence is the recourse of the s 51 of BSCRA Act application.
The fact that the s 51 application avenue is no longer available, cannot be remedied by the applicant simply choosing to ignore the Varied Order and lodging a new complaint against the respondent. It was Psaros Builders who performed the original construction at Tyne Square which was found to be faulty and unsatisfactory work in respect of waterproofing of the basement car park; it was Psaros Builders who was therefore ordered to remedy those works; and it was Psaros Builders who negotiated and agreed a remedial solution and who engaged the respondent to perform the mechanics of the remedial solution. But for its de-registration this application as against the respondent would never have been made. In my view, Psaros Builders clearly carried out the relevant regulated building service the subject of the Varied Order.

Conclusion

In summary, for the reasons provided above, the Tribunal finds that it was Psaros Builders who carried out the regulated building service being the remedial works in respect of waterproofing undertaken at Tyne Square which were completed prior to the notice of completion being lodged. At all times, overarching responsibility for the implementation, design and development of those works was clearly held by Psaros Builders. But for the legal compulsion on Psaros Builders to perform those works, the respondent would never have been engaged. Whilst the respondent undertook the mechanics, as the registered building service provider, it at no time 'assumed' legal responsibility for performance of the building remedy order as contended for by the applicant. The facts simply do not support such a conclusion.
Therefore the Tribunal dismisses the application as misconceived and/or lacking in substance pursuant to s 47 of the SAT Act.

Order

1.Pursuant to s 47(1)(a) of the State Administrative Tribunal Act 2004 (WA) the proceeding is dismissed as misconceived and/or lacking in substance.

I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.
MS C WALLACE, (SENIOR MEMBER)
1 NOVEMBER 2018