| JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL STREAM : COMMERCIAL & CIVIL ACT : BUILDING SERVICES (COMPLAINT RESOLUTION and ADMINISTRATION) ACT 2011 (WA) CITATION : OWNERS OF STRATA PLAN 59377 and CARINE HOMES PTY LTD [2014] WASAT 39 MEMBER : MS A DAVIES (SENIOR SESSIONAL MEMBER) MR R MACHELL (SESSIONAL MEMBER)
HEARD : 26 AND 27 FEBRUARY 2014 DELIVERED : 26 MARCH 2014 FILE NO/S : CC 769 of 2013 BETWEEN : OWNERS OF STRATA PLAN 59377 Applicant
AND
CARINE HOMES PTY LTD
Respondent
Catchwords: Building services complaint Whether work has not been carried out in proper and proficient manner or is faulty or unsatisfactory Installation of building fire system Principles of statutory interpretation Whether consequential loss is compensable Causation Whether lift noisy and unsafe Application for experts' costs Legislation: Building Code of Australia
Building Services (Complaint Resolution and Administration) Bill 2010 (WA)
Building Services (Complaint Resolution and Administration) Act 2011 (WA), s 3(1), s 5(1), s 9, s 11(1), s 36(1), s 36(1)(c), s 38(1), s 38(1)(a), s 49
Strata Titles Act 1985 (WA), s 33
State Administrative Tribunal Act 2004 (WA), s 87, s 87(1), Pt 4, Div 5
Trade Practices Act 1965 (Cth) Result: Application partially successful
Summary of Tribunal's decision: This dispute concerned a multilevel apartment complex comprising two luxury apartments that was developed by a third party. The Owners of Strata Plan 59377 sought compensation, both direct and consequential, from the builder, Carine Homes Pty Ltd, in connection with the installation of the building fire system. The Owners also sought the costs of remedying the building lift, as well as certain experts' costs. With regard to the building fire system, the Tribunal found that the installation had not been carried out in a proper and proficient manner, or was faulty or unsatisfactory within the meaning of s 38(1)(a) of the Building Services (Complaints Resolution and Administration) Act 2011 (WA), in that installation of a direct brigade alarm was required but not completed until well after occupation of the property. The Tribunal also considered, as a matter of statutory interpretation, that compensation for both direct and actual consequential loss was available under s 36(1)(c) of the Building Services (Complaints Resolution and Administration) Act 2011 (WA). However, the Tribunal declined to award compensation, because the Owners did not establish that any direct or consequential loss was caused by the Builder's unsatisfactory workmanship. With regard to the lift, the Tribunal found that the Owners did not establish that any regulated building service associated with the lift had not been carried out in a proper and proficient manner, or was faulty or unsatisfactory within the meaning of s 38(1)(a) of the Building Services (Complaints Resolution and Administration) Act 2011 (WA). In particular, it had not been established what was an acceptable standard of noise, nor whether the lift's noise exceeded that standard. Further, it had not been established what the cause of the improper levelling of the lift was, nor whether the Builder was responsible for it. Finally, the Owners sought the cost of the building report and also an engineering report. Certain rectification works had already been undertaken by Carine Homes Pty Ltd and a number of the complaints were resolved during the hearing by consent orders. The Tribunal determined to award the cost of the engineering report but not the cost of the building report.
Category: B
Representation: Counsel:
Applicant : In person
Respondent : In person
Solicitors:
Applicant : N/A
Respondent : N/A
Case(s) referred to in decision(s):
Hoskins and Daniel Vinci T/as D'Vinci Contracting [2011] WASAT 188
March v Stramare (E & MH) Pty Ltd (1991) 171 CLR 506; [1991] HCA 12
Marks v GIO Australia Holdings (1998) 196 CLR 494; [1998] HCA 69
Psaros Builders Pty Ltd v Owners of Strata Plan 52843 [2014] WASC 34
REASONS FOR DECISION OF THE TRIBUNAL:
Introduction 1 This dispute concerns a multi-level apartment complex comprising two luxury apartments at No 20 (Lot 173) Galileo Loop, Mandurah (Property). 2 The Owners of Strata Plan 59377 (Owners), a strata company, is the applicant in this proceeding. Section 33 of the Strata Titles Act 1985 (WA) entitles a strata company to undertake proceedings where proprietors of lots within a strata scheme are jointly able to take such action, as is the case in respect of common property. Mr and Mrs Barnes own one of the apartments and represent the Owners. 3 Carine Homes Pty Ltd (Builder) is the respondent and was the registered builder of the Property. Mr Crannage is a director of the Builder and, together with his son Mr Crannage junior, represents the Builder. 4 The Property was developed by Robinson Corp Pty Ltd (Robinson Corp), which is not a party to this proceeding, through a building contract between Robinson Corp and the Builder. 5 The Owners seek building remedy orders to require the Builder to pay to have a third party rectify the workmanship items or otherwise to require the Builder to pay compensation. The Owners also seek certain costs.
Legislative scheme 6 This proceeding arises out of a complaint made by the Owners to the Building Commission on 18 January 2013 under s 5(1) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA) (BSCRA Act). 7 Pursuant to s 5(1) of the BSCRA Act, a person may make a complaint to the Building Commissioner about a regulated building service not being carried out in a proper and proficient manner, or being faulty or unsatisfactory. A 'regulated building service' is defined in s 3(1) of the BSCRA Act. 8 Having accepted a complaint, the Building Commissioner is required to cause an investigation by an authorised officer under s 9 of the BSCRA Act and, after having regard to a report of the authorised officer, may determine that one of the alternative courses of action available under s 11(1) of the BSCRA Act is to apply. 9 The complaint under s 5(1) of the BSCRA Act was transferred to this Tribunal on 11 June 2013. 10 The Tribunal's powers upon referral to it of a building service complaint are set out in s 38(1) of the BSCRA Act including in the following terms: If the Building Commissioner refers a building service complaint to the State Administrative Tribunal, the Tribunal may - (a) if the Tribunal is satisfied that the regulated building service that is the subject of the building service complaint has not been carried out in a proper and proficient manner or is faulty or unsatisfactory, deal with the building service complaint by making a building remedy order; or (b) otherwise, decline to make a building remedy order. 11 A 'building remedy order' is defined in s 36(1) of the BSCRA Act in the following terms: A building remedy order consists of one of the following - (a) an order that a person who carried out a regulated building service remedy the building service as specified in the order; (b) an order that a person who carried out a regulated building service pay to an aggrieved person such costs of remedying the building service as the Building Commissioner or State Administrative Tribunal, as the case requires, considers reasonable and specifies in the order; [or] (c) an order that a person who carried out a regulated building service pay to an aggrieved person a sum of money specified in the order to compensate the aggrieved person for the failure to carry out the building service in a proper and proficient manner or for faulty or unsatisfactory building work.
Workmanship - items of complaint pursued by the applicants 12 The hearing was held over two days on 26 and 27 February 2014. 13 At the beginning of the first day of the final hearing, it was clarified that in relation to item 1 of the complaint (being no 1 of the Scott Schedule), the Owners were only seeking experts' costs. 14 The Owners sought leave to withdraw item 4 of the complaint (which does not appear in the Scott Schedule) and item 5 of the complaint (being no 4 in the Scott Schedule). The Tribunal granted leave to do so. 15 The Tribunal also made consent orders in relation to item 2 of the complaint (being no 2 in the Scott Schedule) and item 8 of the complaint (being no 7 in the Scott Schedule). 16 Finally, it is not in dispute that items 1, 3, 6 and 7 relate to common property. 17 Having had the benefit of hearing both sides' submissions, and the evidence, we set out our findings in the order in which the items were heard.
Items 6 and 7 of the complaint: Building fire system non-compliant when apartments sold - no direct brigade alarm as required - not disclosed by the Builder 18 This complaint item is dealt with in nos 5 and 6 of the Scott Schedule. 19 The Owners say that steps have now been taken to achieve compliance of the building fire system in the Property and therefore seek compensation. 20 The Owners say that it was a requirement of the building licence conditions of approval that the Builder provide a compliant building fire system, and that it did not do so. The Owners say that in order to subsequently achieve compliance of the building fire system in the Property, it was necessary to have an additional 'telephone' line installed, which cost $3,045.13. The Owners seek a refund of $3,045.13. 21 Further, the Owners say that the fact that the Builder did not provide a compliant building fire system led to the maintenance and monitoring costs of the building fire system not being disclosed by the developer. The Owners say that if the building fire system had been operational, the developer would have received bills and would therefore have disclosed these costs. The Owners seek $4,223.50 per annum, plus future compounding CPI, on the basis that the Owners will now have to find extra money that they had not expected to have to pay when purchasing the Property. 22 The Builder says that it is not responsible for the cost of installing an additional 'telephone' line, nor for the maintenance and monitoring costs of the building fire system. The principal reason given by the Builder is because an expert certified that the building fire system was compliant and the Builder, therefore, could not have known that it was not compliant.
What was the Builder required to have done? 23 There is no contractual relationship between the Builder and the Owners, and these items involve an issue of workmanship. However, the contractual requirement defines what the Builder was required to do, which informs the issue of workmanship. 24 Exhibit 2 includes a variation to contract dated 16 August 2008 (Variation). The Variation requires the installation of a 'fire sprinkler system' at the Property. It does not include any specifications. 25 The building licence dated 2 November 2007 issued to the Builder in respect of 'Lot 173, No 20 Galileo Loop Mandurah' appears in the Hearing Booklet at page 5. 26 A document entitled 'Conditions of Building Licence Approval' in respect of 'Lot 173, No 20 Galileo Loop Mandurah' appears in the Hearing Booklet at pages 114 to 116. The Owners did not call an officer of the City of Mandurah to establish that this document is a true copy of the conditions imposed on the Property. However, the Tribunal accepts that the document is what it appears to be; namely, conditions of building licence approval applicable to the Property (Conditions). 27 Footnote 6 of the Conditions provides that the complete scope of works covered by the building licence remains the responsibility of the Builder named on the building licence. 28 Item 37 of the Conditions specifies that: This approval includes Fire Engineering Report No. 956 by Saraceni L & N Design Group dated 31 July 2007. All requirements contained within the Fire Engineering Report are to be complied with …' 29 Fire Engineering Report No 956 by Saraceni L & N Design Group dated 31 July 2007 (Report) is at Exhibit 4 and provides, inter alia, at page 6: 30 It was common cause that a direct brigade alarm is a fire alarm that includes monitoring by the Fire Brigade. 31 Exhibit 2 also includes the HIA lump sum building contract standard terms (Standard Terms) and an unsigned and partially filled in schedule of particulars (Schedule). The Tribunal accepts that these documents are what they purport to be; namely, the Standard Terms and Schedule of the building contract between the Builder and Robinson Corp. 32 Clause 3(a) of the Standard Terms provides that the Builder shall obtain any permits or licences that are required for the performance of the works, and clause 3(b) of the Standard Terms provides, in effect, inter alia, that the Builder shall comply with the permits and licences. 33 The combined effect of clauses 3(a) and 3(b) of the Standard Terms and item 37 of the Conditions is to require, contractually, the Builder to carry out the Variation in accordance with the Report. Even if this were not the case contractually, item 37 of the Conditions required the Builder to install a building fire system in the Property in accordance with the Report. 34 Accordingly, the Tribunal finds that the Builder was required to install a building fire system in the Property in accordance with the Report. In particular, the Tribunal finds that this included the Builder installing a fire sprinkler system and a direct brigade alarm that would be activated by a fire alarm in the building.
Did the Builder install a building fire system with a direct brigade alarm, and was the service satisfactory? 35 There was some conflicting material as to when the Property was completed by the Builder. The latest date indicated by Mr Crannage was January 2010 (Hearing Booklet at page 68). On this basis, the Tribunal finds that the Property was completed, at least substantially, by the Builder by January 2010. 36 Mrs Barnes said that their unit in the Property was purchased in January 2011 (T:109; 26.02.14). The Tribunal accepts this evidence and finds that Mr and Mrs Barnes purchased their unit in January 2011. 37 There was no evidence to indicate when Mrs Mazzola, the owner of the other apartment, purchased her unit. 38 In support of the Owners' claim, the Owners called Mr J Morton. Mr Morton is the Direct Brigade Alarm Contracts Manager from the Department of Fire and Emergency Services (Fire Brigade). Mr Morton gave evidence in a straightforward way and the Tribunal accepts him as a credible witness. 39 Mr Morton said that connection to the Property to enable monitoring by the Fire Brigade did not occur until 5 November 2012 (T:63; 26.02.14). On this basis, the Tribunal finds that the installation of a direct brigade alarm was not completed until 5 November 2012. 40 Mrs Barnes said that this had been arranged through 'Axis' after the Owners had paid $3,045.13 to Telstra (T:64; 26.02.14). This payment was for a commercial works upgrade and the installation of a 10 pair lead-in (Hearing Booklet at page 28). 41 There was some confusing and contradictory correspondence from the Builder to the Owners as to what the Builder did and where the telephone lines terminated (Hearing Booklet at pages 12 and 69). However, during the hearing, Mr Crannage, on behalf of the Builder, conceded that the Builder had engaged a subcontractor, whom he refer referred to as 'AP Fire', to install the building fire system in the Property. Mr Crannage indicated that he was aware that 'AP Fire' arranged for 'Axis Fire' to undertake part of this subcontract (T:47 and T:112; 26.02.14; see also T:57; 26.02.14). 42 It is trite that, where a contractor engages a subcontractor to undertake part of a contract, the contractor remains responsible under the original contract for compliance with the contractual requirements unless otherwise agreed. This is so, even if the subcontractor also contracts out all or part of the subcontract. In this legal sense then, the contractor has 'carried out' the work that was completed by the subcontractor or the subcontractor's subcontractor. 43 The Tribunal finds that the Builder did ultimately install a building fire system with a direct brigade alarm, but that this did not occur until well after occupation of the Property. 44 The Tribunal does not accept the Builder's submission that the certification by Saraceni L+N Design Group dated 13 January 2010 - that a fire safety system had been designed and installed in accordance with, inter alia, the Report - discharges the Builder's obligations, contractual or otherwise, to, in fact, provide a fire indicator panel with a direct brigade alarm. 45 Accordingly, the Tribunal finds that the installation of the building fire system in the Property was not carried out in a proper and proficient manner, or was faulty or unsatisfactory within the meaning of s 38(1)(a) of the BSCRA Act, in that installation of a direct brigade alarm was not completed until well after occupation of the Property.
Are the Owners entitled to the cost of the works upgrade by Telstra or monitoring and maintenance costs of the building fire system? 46 Mr Morton also gave evidence that 'Axis Fire' had applied to the Fire Brigade for a connection to the direct brigade alarm, or 'DBA' network, on 27 May 2009 (T:62; 26.02.14). Mr Morton said that the Fire Brigade then issued relevant documents, which included an agreement between Robinson Corp and the Fire Brigade, for a direct brigade alarm connection. That agreement, between Robinson Corp and the Fire Brigade, was received back, signed by Mr Brian Robinson of Robinson Corp on 4 June 2009 (T:114; 26.02.14). However, the remaining necessary documentation was not received back from 'Axis Fire' at that time. 47 Mr Morton said that it was not until 5 November 2011 that all necessary documentation was received back from 'Axis Fire' (T:62, T:115 and 116; 26.02.14). Shortly after that, Mr Morton said he went to the Property for an inspection to ensure that the building was ready for a connection, and found that it was not, because there were only 'two-pair phone cables' coming into the building and both were terminated against the internal cabling. Mr Morton explained that it was only these two lines that were connected to the Telstra pit (T:63 and T:72; 26.02.14). 48 It was not in dispute that there were four pre-wired 'telephone' lines installed within the Property by the Builder - one for the lift, one for the building fire system, and one for each unit - all taken to the main distribution frame or 'MDF' on the Property. 49 It was also not in dispute that the telephone line for the lift was connected - from the 'MDF' to the Telstra pit adjacent to the Property - and operational. 50 What was effectively in dispute, was whether the second line, which was connected from the 'MDF' to the Telstra pit (when Mr Morton visited the Property in November 2011), had been made available by or through the Builder for connection of the direct brigade alarm, and whether the Builder was responsible for connecting the third and fourth lines. 51 Exhibit 2 also includes an Addenda to Standard Specifications (Addenda) which, at page 3, states: 52 In the Addenda, Robinson Corp is the 'Client' and the term 'Owner' is not defined. However, what is clear is that the Builder was not required to connect the home telephones into the units. 53 Accordingly, the Tribunal finds that the Builder was not responsible for taking any further steps to enable a home telephone in either of the units to be connected and operational. 54 The Builder called Mr Robinson from Robinson Corp to give evidence as to the connection of the lines prior to 'people moving in' (T:18; 26.02.14). Mr Robinson said he was a company director of various companies in construction and development. His background is in construction and retail. 55 Mr Robinson's evidence as to the connection of the lines prior to 'people moving in' was given clearly and was inherently logical. However, in cross-examination, the Owners also wished to cross-examine Mr Robinson on other aspects in issue in the proceeding. In cross-examination, Mr Robinson's evidence was at times disjointed and at other times vague. At certain points, he had difficulty recalling details. The Tribunal has had difficulty reconciling the differences in his evidence. The Tribunal has concluded that the witness was not given notice of the range of issues in dispute in the proceeding and that, as the events took place in 2009, this accounts for the discrepancy in his evidence. Ultimately, the Tribunal accepts Mr Robinson as a credible witness. 56 Mr Robinson said that Telstra only gave Mr and Mrs Barnes two lines because they were having trouble with the amount of services in the area. He said they needed those two lines for the lift and the fire alarm (T:75 - T:77; 26.02.14). 57 Mr Barnes said that it was his understanding that the second line was used for the security system because when Telstra came out to connect their home telephone, Mr Barnes said that the Telstra technician had said that the only live line he could detect was the one that went to the security system in their unit. Mr Barnes also said that the Telstra technician had put a 'splitter on that line' to connect their home telephone (T:111; 26.02.14). The Owners did not call the Telstra technician to give evidence. Mr Barnes also said that he saw 'the line' going into the security system box (T:110 and T:111; 26.02.14), although he admitted he is not a technician. 58 Mr Crannage said that there is no wiring from the security system box to the Telstra pit because they are not monitored. Although there is 'a phone point to it, in case anyone wanted to upgrade' the alarms are just a little 'scare-on-the-way-in security system' (T:47; 26.02.14). 59 The Tribunal prefers Mr Crannage's evidence on this issue. The Builder's position that there is pre-wiring for a lift, fire system and two home telephones has been maintained consistently. Further, the Owners' evidence, regarding what the Telstra technician said, amounts to hearsay evidence that cannot be tested and is therefore unreliable. 60 Accordingly, the Tribunal finds that the second line connected from the 'MDF' to the Telstra pit had been made available by the Builder for connection of the direct brigade alarm prior to occupation of the Property. 61 Regarding the Owners' claim for compensation, the Tribunal's power is conferred, and limited, by the terms of the BSCRA Act. 62 Section 38(1) of the BSCRA Act provides that the Tribunal may make a building remedy order if satisfied that a regulated building service has not been carried out in a proper and proficient manner, or is faulty or unsatisfactory. This gives the Tribunal a discretion whether or not to do so. 63 Section 36(1)(c) of the BSCRA Act specifies that an order requiring an amount of money to be paid is to compensate the aggrieved person for the failure to carry out the regulated building service in a proper and proficient manner, or for faulty or unsatisfactory building work. 64 There is otherwise no limitation in the statute regarding compensation payable pursuant to s 36(1)(c) of the BSCRA Act. 65 The purpose of the BSCRA Act is as is specified on page 1 of the BSCRA Act: An Act to provide for the following - • a system for dealing with complaints about building services, home building work contract matters and disciplinary matters; • a public officer with functions relating to building services and complaints; • a levy in relation to certain authorisations for building services; • a system for ensuring compliance with laws about building services; [and] • related matters. 66 Of course, established principles of statutory interpretation are applicable to a civil and administrative tribunal. Such principles include that a construction of a statute that promotes the purpose or object underlying a statute is to be preferred to one that would not, but that cannot detract from the fundamental importance of the language used by the legislature: Psaros Builders Pty Ltd v Owners of Strata Plan 52843 [2014] WASC 34 at [33] to [34] per Allanson J. 67 The Explanatory Memorandum to the Building Services (Complaint Resolution and Administration) Bill 2010 (WA) addresses s 36(1)(c) of the BSCRA Act, but only by way of confirming, at page 19, that the scope of this provision would extend to allowing a third party: … such as a neighbour who has been adversely affected by the building work, to seek compensation for any consequential damage caused. 68 In the context of the former Trade Practices Act 1965 (Cth), the High Court has stated that while analogies to torts or contract may be useful, the scope of statutory damages is to be determined by the terms of the specific legislation: see, for example, Marks v GIO Australia Holdings (1998) 196 CLR 494; [1998] HCA 69. 69 It is clear from the ordinary and natural meaning of s 36(1)(c) of the BSCRA Act that the aggrieved person must have suffered a loss, which loss was caused by the unsatisfactory building work. Otherwise, as there is no limitation in the BSCRA Act regarding compensation payable, the compensation available appears to be akin to damages in tort for deceit, where actual consequential loss is compensable without limitation by tortious principles of remoteness of damage. 70 Accordingly, the Tribunal concludes that the Owners' actual consequential loss, as well as direct loss, is compensable under s 36(1)(c) of the BSCRA Act. 71 However, in the circumstances, the Owners have not established that any direct loss which was caused by the Builder's unsatisfactory work has been sustained by the Owners. This is because the sum that would compensate the Owners for the Builder's failure to carry out the building service in a proper and proficient manner, or for faulty or unsatisfactory work, is the cost of being able to utilise telephone line two (or an equivalent) and any associated cost in establishing alarm monitoring. This does not include the cost of Telstra providing additional capacity, or any Telstra connection fee, which would not have been necessary if a telephone line had not been desired and connected by Mr and Mrs Barnes because the Builder is not responsible for the connection of home telephones into the units. As 'Axis Fire' subsequently proceeded to establish the alarm monitoring, and without the need for any switching of lines due to the additional capacity, there is no direct loss to be compensated by the Builder. 72 Further, the Owners have not established that the consequential loss sought - namely, the cost of monitoring and maintenance of the building fire system - was caused by the Builder. The cause of such consequential loss, if established, would be the developer's failure to disclose the cost of monitoring and maintenance of the building fire system. That the developer may have been reminded of costs to include in disclosure papers, if the Builder had connected the direct brigade alarm earlier and monitoring costs were therefore incurred by the developer before sale, does not render the Builder's unsatisfactory work 'a cause' of any such loss for the purposes of establishing liability to pay compensation. In the common law, by way of analogy, even if an act or omission could be described as 'an essential condition' of negligence by a third party, such act or omission is not itself a cause: see March v Stramare (E & MH) Pty Ltd (1991) 171 CLR 506; [1991] HCA 12 at [23] per Mason CJ. 73 Accordingly, the Tribunal declines to make a building remedy order in relation to these items, and the application, insofar as it relates to these items, is dismissed.
Item 3: Lift - noisy and unsafe - lift motor activates on its own (day and night) - no sound proofing, and motor is leaking oil 74 This complaint item is dealt with in no 3 of the Scott Schedule. 75 The Owners seek a building remedy order to require the Builder to pay to have a third party repair and service the lift. 76 The Owners say that the lift is noisy and unsafe. During the hearing, most of the time dealing with this item was spent addressing the noise issue. The Owners say that the lift is noisy when operating and that it self-adjusts, including during the middle of the night. 77 The Owners say that the lift is unsafe in that it is not levelling correctly; that is, it is necessary to 'step up' in order to get out of the lift. The Owners further say that the lift motor is leaking oil. 78 The Owners explained that the lift had not been serviced by the Owners at all because they did not want to lose their claim about workmanship and functionality. 79 It is common cause that the Owners raised problems with the lift with Builder, and the Builder arranged for the company that commissioned the lift to come and look at it. However, the Owners say that this made the situation worse in that the lift readjusts more, perhaps up to twelve times a day, and that now it is necessary to step up in order to get out of the lift. 80 It is also common cause that the lift is a disabled lift. 81 The Builder says that the lift is noisy because it has not been maintained; in particular, that noisiness when the lift is operating is not the motor but because 'the rollers and rails' have not been greased. The Builder also says the lift is self-adjusting in this way because it has not been maintained. He says that when the Property was handed over, the lift was in good working order and was accepted by the developer. 82 Regarding the Owners' claim that the lift is not levelling correctly, Mr Crannage, on the Builder's behalf, says that he has not seen this 'creep' himself and that, when maintenance was undertaken of the lift, there was no problem getting in and out of it. 83 In support of the Owners' claim that that the lift is noisy and unsafe, the Owners relied upon the building consultant's report by Mr S Walton dated 3 May 2013 in respect of an inspection on 29 April 2013 (Building Consultant's Report), and in particular, Mr Walton's conclusion that: The hydraulic unit for the lift is very loud and the sound proofing provided is completely inadequate. The hydraulic power pack appears to be leaking. There are on[-]going faults which includes [sic] the lift having to reset its self [sic] to the home position (this may be due to the leaking hydraulics)[.] 84 Photograph 46 at page 62 of the Hearing Booklet shows the soundproofing to the hydraulic pump that Mr Walton is referring to. 85 Mr Walton gave evidence by telephone during the hearing. He is a registered builder. He explained that his registration is restricted to class 1 buildings. Mr Walton gave his evidence in an open and straightforward manner and the Tribunal accepts Mr Walton as a credible witness. However, for the reasons set out below, the Tribunal does not regard Mr Walton as an expert in lifts. 86 Mr Walton explained that he had inspected the lift and considered its operating sound level 'loud', and that this was unsatisfactory. He said that his opinion in this respect was based on a comparison of this lift with other lift systems. 87 However, in cross-examination, Mr Walton conceded that he had no experience with this kind of lift and was not aware of any requirements for soundproofing. He also conceded that what he had referred to in his Building Consultant's Report as a leak around the hydraulic power pack could have been spillage from an overfill. It was also clarified that Mr Walton's expertise extends to class 1 and class 10(a) buildings and that the Property is a class 2 and class 10(a) (footnote 4 of the Conditions of Building Licence Approval at page 115 of the Hearing Booklet). 88 In support of the Owners' claim that that the lift is noisy and unsafe, the Owners also relied upon the oral evidence of Mr John Hughes from OTIS Elevator Company Pty Ltd (OTIS). The Owners also relied upon Mr Hughes to establish the cost of having a third party rectify the lift, and a quote is at page 95 of the Hearing Booklet. 89 Mr Hughes is the senior account representative at OTIS, a lift supplier. He said he has been in the lift industry for 40 years and is an electrician. The Tribunal accepts Mr Hughes as a credible, expert witness. 90 Mr Hughes said that he had visited the site and observed that the lift was not levelling correctly and that there was 'a slight oil leak' around the pump. He also said he thought the lift was noisy in that it rumbled and the rollers were making noise when operating. 91 Mr Hughes said that he did not attempt to assess the noise from within either of the units and that he did not know what the cause of the noise was. He said that ordinarily there was no requirement with respect to soundproofing, and he speculated that that someone has wrapped the foam sheeting around the pump because of a complaint. 92 Mr Hughes said something must be 'wrong with the hydraulics' for the levelling to be out. 93 In cross-examination, Mr Hughes conceded that the kind of lift at the Property is not the kind of lift OTIS installs. He also said that the lift would need a minimum of one-yearly maintenance visits, and that the problems could have been due to a lack of maintenance, but he did not know. He said his quote was for the purpose of determining what the problem is. 94 The Tribunal notes that, at pages 101 to 104 of the Hearing Booklet, there is a memorandum from Herring Storer Acoustics purporting to summarise Building Code of Australia (BCA) requirements relating to acoustical requirements, including in the walls of a plant room and lift shaft of a class 2 building. This summary was not referred to by either party during the hearing, and the requirements were not verified as current nor explained to the Tribunal. Furthermore, the Owners did not assess the noise levels against any objective standard, such as the BCA, nor establish that the noise levels exceeded any such reasonable level. 95 The Tribunal finds that the Owners have not established that any regulated building service associated with the lift has not been carried out in a proper or proficient manner, or is faulty or unsatisfactory in that: 96 Furthermore, even if the lift had been found to be unsatisfactory within the meaning of s 38(1) of the BSCRA Act, there is no evidence to establish the cost of fixing the lift. The quote provided by the Owners is simply to investigate the problems. 97 Accordingly, the Tribunal declines to make a building remedy order in relation to this item, and the application, insofar as it relates to this item, is dismissed.
Item 1: External building walls - significant cracking and water damage to all levels 98 This complaint item is dealt with in no 1 of the Scott Schedule. 99 The Owners sought only the cost of the Building Consultant's Report and the engineering report in relation to this item. It was common cause that the Builder had undertaken remedial work in accordance with the engineer's recommendation. 100 The Owners say that the engineering report was a necessary part of achieving rectification of complaint item 1 and that it was Mr Walton - who provided the building report - who recommended engineering advice be obtained. 101 The Builder says that only the cost of the engineering report should be borne by the Builder. The respondent also says that Mr Walton was not qualified to assess the issues because, by his own admission, he was registered as a builder for class 1 properties and the Property is a class 2 and class 10(a) property. 102 Section 87 of the State Administrative Tribunal Act 2004 (WA) (SAT Act) provides that: Costs of parties and others (1) Unless otherwise specified in this Act, the enabling Act, or an order of the Tribunal under this section, parties bear their own costs in a proceeding of the Tribunal. (2) Unless otherwise specified in the enabling Act, the Tribunal may make an order for the payment by a party of all or any of the costs of another party or of a person required to produce a document or other material on the application of the party under section 35[.] 103 Section 49 of the BSCRA Act provides as follows: Costs and expenses (1) Subject to this section, the Building Commissioner or the State Administrative Tribunal may make such orders for costs as they think fit in relation to proceedings arising from a building service complaint or a HBWC complaint. … (7) This section does not limit the powers of the State Administrative Tribunal under the State Administrative Tribunal Act 2004 Part 4 Division 5. 104 Part 4 Div 5 of the SAT Act is the division dealing with costs, and includes s 87 of the SAT Act. 105 As was observed by the Tribunal in Hoskins and Daniel Vinci T/as D'Vinci Contracting [2011] WASAT 188 (Hoskins) at [11], the power to award costs under s 49 of the BSCRA Act represents a departure from the provisions for the award of costs under the SAT Act and, at [14], that the initial predisposition against an award of costs has been removed. Of course, as was also observed in Hoskins at [16], while s 87(1) of the SAT Act requires that the provisions of s 49 of the BSCRA Act apply, s 49 should be construed in a manner which promotes the objectives and procedures of the Tribunal. 106 The Tribunal concluded in Hoskinsthat these objectives would not be fostered by an approach that costs should follow the result as a general rule, but that there will be cases in which it will be appropriate to exercise a discretion to enable the successful party to recover all costs which may be properly recovered in proceedings before the Tribunal. 107 The Owners were successful in resolving complaint item 1 utilising the Building Consultant's Report (as well as the engineering report), but the Building Consultant's Report relates to all aspects of their claim and not just item 1 of the complaint. While two consent orders also resulted from this hearing, the Owners have still not been successful in relation to most of the issues the subject of the Owners' complaint. Further, of the parts of the complaint in which the Owners have been successful, the Building Consultant's Report itself played, at best, a minor role. 108 The Tribunal determines not to award the cost of the Building Consultant's Report. 109 The Builder remedied complaint item 1 in accordance with the engineer's recommendations. The Builder concedes that the Owners are entitled to the cost of the engineering report. 110 The Tribunal determines to award the cost of the engineering report. 111 The tax invoice for the engineering report is at page 90 of the Hearing Booklet and is $200 plus GST. 112 Accordingly, the Tribunal finds that the Owners are entitled to an award of costs in the amount of $220.
Order |