Paul Bongioletti Homes Pty Ltd v North
[2012] QCATA 175
•13 September 2012
| CITATION: | Paul Bongioletti Homes Pty Ltd v North and Anor [2012] QCATA 175 |
| PARTIES: | Paul Bongioletti Homes Pty Ltd (Applicant/Appellant) |
| v | |
| John Robert North (First Respondent) Steve Pershouse t/as Steve Pershouse Concreter (Second Respondent) |
| APPLICATION NUMBER: | APL171-11 |
| MATTER TYPE: | Appeals |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Mr J Jerrard QC, Member |
| DELIVERED ON: | 13 September 2012 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | Leave to appeal is refused.1. The decision under appeal is amended by deleting from order 1 made on 18 April 2011 the figure “$15,546.60” and inserting instead the figure “$16,454.07”.2. The decision of the primary tribunal is otherwise confirmed.3. |
| CATCHWORDS: | APPEAL – LEAVE TO APPEAL – DAMAGES – GENERAL PRINCIPLES – GENERAL AND SPECIAL DAMAGES – where first respondent bought a house that did not have a termite barrier compliant with Australian building requirements – where Tribunal found appellant builder liable for loss to first respondent – whether leave to appeal should be granted – whether appellant builder breached duty of care to the developer by erecting a building without a complying termite barrier – whether conduct of second respondent constituted an intervening causative event Building Act 1975, ss 9, 10, 12, 30 Bryan v Moloney (1995) 182 CLR 609 |
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to s 32 of Queensland Civil and Administrative Tribunal Act2009 (QCAT Act), but some further evidence was heard by leave granted in April 2012.
REASONS FOR DECISION
This is an appeal from a decision handed down on 18 April 2011, in which the learned Member ordered that the appellant pay to the first respondent damages in the sum of $15,546.60 within 28 days of the date of that order; and, further, that the appellant provide two durable notices for the under slab termite management system completed by the pest management company that installed a system, within 28 days of the date of that order. No orders were made in respect of the second respondent. I understand that the appellant company has not complied with either order. An application for leave to appeal, or an appeal, was lodged by the appellant on 17 May 2011, and this appeal has been on foot since then.
On 7 June 2011 an application by the appellant for a stay was refused, and on 16 August 2011 the appellant was given leave to be legally represented in the appeal. On 22 August 2011 directions were given that an application by the appellant for leave to lead further evidence, and the hearing of the appeal and the application for leave to appeal be decided on the papers. On 5 December 2011 a direction was given that it was unnecessary for the appellant to have leave to lead the further evidence (the contract between the developer and Mr North), because that contract was already in evidence, forming part of exhibit 3 in the original hearing. On 12 December 2011 directions were given inviting the parties to provide further written submissions on two identified topics, and as to whether any party wanted to lead further evidence on those points. On 19 April 2012 further directions were given, granting the parties leave to lead further evidence on the two nominated topics, and directing that any party wanting to lead further evidence must file documents identifying the names of proposed witnesses, and a summary of the evidence to be given, and giving a copy of that material to the other party by 21 May 2012; and listing the matter for hearing of further evidence on the two half days of Monday 28 May 2012 and Monday 4 June 2012 starting at 9:30am. As it happened, a further hearing was held on Monday 28 May 2012, and that was sufficient. Further written submissions had been received from Mr North, the first respondent, on 21 May 2012, and from the appellant on 23 May 2012.
The proceedings arise out of a dispute over a house bought by the first respondent from a developer in late 2007. The first respondent signed a contract to buy a house and land situated at 8 One World Drive, Redridge, Hervey Bay, on 3 October 2007. The vendors were two companies, Choreto Pty Ltd and Blue Bullet Pty Ltd. The learned Member found that the first respondent was told by the vendors that there would be an external termite barrier, namely a visual slab face termite barrier, around the house. That finding was not challenged in this appeal. Settlement occurred on 19 November 2007. The first respondent subsequently made complaints to the Queensland Building Services Authority (‘QBSA’) about various issues, relating to the construction of a house, and ascertained that the render came too far down the face of the concrete for there to be an effective slab face termite barrier.
The first respondent’s first complaint to the QBSA was made on 20 February 2008, and a second complaint on 20 March 2009, wherein he complained that a concrete path put around the house had compromised the termite barrier. That second complaint resulted in an inspection on 12 May 2010, conducted by the QBSA in the presence of the builder (the appellant), and a further inspection in June 2010. The point of the second inspection was to determine whether the builder was correct in the assertion made by its representative (Mr Paul Bongioletti, its director), that when the house was constructed by the builder, it had a visible concrete termite barrier, compliant with Australian building requirements, and that the second respondent, Mr Pershouse, had (in breach of Australian Building Code requirements) built a concrete pathway around the house in such a fashion as to conceal the existence of the previously visible concrete termite barrier.
The appellant’s basic position was that it had completed constructing the house on or before 26 October 2007 (its contract not being with the first respondent, but with the developers), and that it was not obliged to build, or responsible for the construction of, any concrete path around the house. The first respondent’s contract of purchase provided in special condition no. 4 that the house would have a boxed up driveway and “coloured concrete around exterior of home – 900m on laundry side, also apron from garage to front door. 300mm at rear also front door/kitchen.” It appers to have been common ground at the hearing, and on the appeal, that this condition, specified by the first respondent, resulted in Mr Pershouse being contracted to provide a driveway and a concrete apron around the house. This he did, and the photographs which became exhibit 11 in the hearing before the learned Member, and the other evidence, established that he had built that concrete surround or pathway around the house so that it was level with the top of the house slab. One issue of fact to be determined by the Member was why Mr Pershouse had done that, and the more important one was whether, in so doing, he had thereby disguised the fact that the house slab had previously presented a visible concrete barrier against termites.
The first respondent’s further submissions received on 21 May 2012, included a copy of the relevant part of the Building Code of Australia, paragraph 3.1.3.3, to which reference had been made in the original proceeding, in the evidence of the witness Michael John Rendell, the then area manager of the Maryborough BSA office. He had conducted the inspections in May 2010 and June 2010, and had issued a direction to rectify, number 35084, addressed to the appellant on 24 June 2010. That direction contended that the perimeter termite barrier did not achieve the minimum requirements of the Building Code of Australia, at part 3.1.3. An accompanying report 78524-22, written by Mr Rendell, and dated 23 June 2010, included the comment that, “the estate is newly cleared from native bush and the pressure from termites is expected to be severe”.
The Building Code of Australia relevantly provided in 3.1.3.1(c) that:
…the edge of a slab-on-ground may be used as a perimeter barrier provided –
(i) The slab is edge is left exposed, not less than 75mm above finished ground level; and
(ii) The face of the exposed edge is not rough or honeycombed and does not contain ripples caused by folds in vapour barrier or the like that could conceal termite activity: and
(iii) The exposed surface is not rendered, tiled, clad or concealed by flashing.
The appellant’s position (as put by Mr Paul Bongioletti) was essentially that he had completed building a house for the developer by 26 October 2007, by which date the builder had been given a final inspection certificate. That certificate, issued pursuant to Building Regulation 2006, relevantly certified that an inspection had been carried out in accordance with best industry practice, and the building work for that building was inspected and complied with the building approval. The dates of inspection were described as 21 March 2007, 18 April 2007, and 25 October 2007. The certificate purported to be signed by a building certifier named John Hartnett. The appellant contended at all relevant times that its contractual and other obligations regarding the building had ended by that date, the house structure having been completed, and that the developers had said, “we’ll organise the finish of the house,” referring to the laying of turf, the concreting, the driveway, and generally tidying up the site. Mr Bongioletti said he did not return to the site after that date, and was “categorically” not involved in any organisation of the exterior horizontal concreting.
He had also asserted to Mr Rendell that, when he left the site, the house he had built was sitting on a concrete slab, which satisfied the description in the Australian Building Code paragraph 3.1.3.1.(c), it being a slab-on-ground which had an exposed good quality concrete face not less than 75mm above finished ground level. Being (by implication) good quality concrete, that exposed edge was neither rough nor honeycombed, and did not contain ripples that could conceal termite activities.
Mr North disputed both that claim by the appellant and the appellant’s further claim that Mr Pershouse’s concrete footpath, built so that it was level with the house slab, had effectively covered over and concealed the previously existing compliant termite barrier. That dispute resulted in the QBSA, with Mr North’s agreement, arranging for the concrete footpath to be dug up on 2 sites, on the southern and northern sides of the house, to examine what the footpath had previously concealed. The photographs of what was seen, taken on 9 June 2010, became exhibit 11 in the proceedings. What those photographs demonstrated was that on the southern side of the house there was no exterior visible termite barrier, because the render on the exterior southern wall had been placed down on to the concrete slab, thereby preventing the building from having an exposed slab edge.
In the hearing conducted on 28 May 2012, Mr Pershouse gave evidence that render thus covering concrete is not an acceptable termite barrier, for three reasons. The first is that the provisions of the relevant building code, quoted earlier, require that an exposed surface of a slab-on-ground is not “rendered” (i.e. covered in render), so that to cover with render what would otherwise have been a good off form concrete surface is to produce a surface not compliant with the code. The second, and the reason the code prohibits covering concrete with render, is that termites can crawl between render and concrete, and the third is that Mr North says that has happened at those very premises, since this matter was determined by judgment in April 2011.
Mr North’s further submissions received on 21 May 2012, asking permission to lead further evidence and further documentation, asserted that in February 2012 he had experienced a termite infestation at those premises. He had informed Mr Bongioletti of that, and contacted a local pest controller, who had inspected the property and made various suggestions. Mr North had then caused a 200mm wide sections of concrete path, for the full perimeter of the house, to be excavated. He had photographed what was revealed. His written submission described those photographs as exhibit 1 to the submission, and he provided an index of them numbering the photographs A through to Q. The photographs purporting to be of the south side of the house include, as part of what was photographed, pieces of cardboard bearing the date 14 May 2012, presumably the date the photographs were taken. There was no objection by Mr Bongioletti, appearing for the appellant on the hearing conducted by leave, or by the lawyer given leave to appear for him, to the admission into evidence of these photographs, or the accompanying assertions by Mr North that had had experienced a termite infestation in February 2012. There was no challenge, in Mr Bongioletti’s cross examination, to Mr Pershouse’s contention that the termite infestation had occurred on the south side of the house, with the termites apparently gaining entry via a hole in the render purportedly covering the concrete slab edge, as shown in photographs marked J 2.
Mr North contended that the photographs of the northern side of the house revealed that, although the render had not come so far down on that side and left a visible concrete slab face approximately 100mm in height below the render, (as shown in exhibit 11L and exhibit 11M, tendered at the original hearing), the photographs taken in May 2012 of the northern side of the house, and particularly photographs C 2, D, E and F, depict a concrete slab that was not good quality, off form concrete, and which was pitted and which had fold marks.
Those descriptions appear primarily in the index that accompanied his written submission, stamped as received on 21 May 2012. He was not challenged, in the cross examination conducted by Mr Bongioletti, on those descriptions of the quality of the concrete edge visible below the render on the north side of the house.
Instead, the appellant’s position, as put in its written submissions, stamped as received on 23 May 2012, and in Mr Bongioletti’s evidence and cross examination, was that while he conceded the render had come “too far down” on the southern side of the house, the appellant had been given a “final certificate” on 26 October 2007, and that Mr Pershouse, the second respondent, ought to have corrected whatever visible defects were apparent in the slab before laying the concrete path around and adjoining the house. The appellant’s written submission included references to the Australian Building Codes, which Mr Bongioletti said in his evidence were put in by the appellant to demonstrate that the concreter, Mr Pershouse, had been in breach of the Building Code of Australia in building the path to the same height as the top of the slab-on-ground and not allowing for a sufficient slope in the path, to run water away from the house.
The appellant’s contention that Mr Pershouse was in breach of the Australian Building Code (the appellant specified this as 3.1.2.3(b)(iii)) in building the path level with the top of the house slab, may or may not be accurate. It does not respond adequately to the explicit finding by the learned Member that Mr Pershouse did that[1] relying upon the advice given to him by Mr Bongioletti.
[1] At [52] of the reasons for judgment, given on 18 April 2011.
One difficulty in determining this appeal lay in the fact that the transcript did not record the cross examination by Mr Pershouse of Mr Rendell (it appears there was an equipment malfunction)[2], nor the evidence given by Mr Pershouse or a Mr Davies (see the transcript at page 106, where the statement simply appears “no further proceedings recorded”). That problem was one of the reasons leave was given for further evidence to be heard in late May 2012. Mr Pershouse gave evidence by telephone on that resumed hearing, and the evidence that he gave was consistent with the findings of the learned Member, and it was not suggested to Mr Pershouse that his evidence in May 2012 differed in any relevant way from the evidence that he had given in February 2011.
[2] See page 76 of the transcript.
The learned Member, in the reasons for judgment, had quoted Mr Pershouse, (in [39] of the reasons), as follows:
In relation to the termite system, he says he could see that the render had broken the tool line and specifically raised this with Mr Bongioletti, who told him to go ahead and concrete to the tool line.
The photographs, which became exhibit 11 at that proceeding, show what Mr Rendell referred to as the “iron line” or “tool line”, depicted in the photographs which became 11A and 11M, those being of the south and north side of the house respectively. That “tool” or “iron” line is horizontal, and marks the top of the slab on which the house sits. On the south side of the house, depicted in 11A, that tool line is some 110mm above ground level, and on the northern side (depicted in 11M), it is some 210mm. Both photographs show that the render applied to the wall of the house (honey coloured) extends about 100mm below that tool line. It is apparent that this is the “tool line” that Mr Pershouse was describing in the evidence referred to by the learned Member.
The cross examination of Mr Paul Bongioletti, conducted by Mr Pershouse at the original hearing, is recorded in the transcript, and that records that Mr Pershouse asserted in that cross examination, and Mr Paul Bongioletti agreed, that Mr Pershouse had cross examined Mr Rendell about exhibit 11P (a photograph) and had obtained Mr Rendell’s agreement that the render had gone past “the bottom of the rebate”, and that this that had broken the visual termite barrier that was supposed to be there.[3] Mr Pershouse’s questions asserted, and Mr Bongioletti did not disagree, that the “tool line” is the “bottom of the rebate”.
[3] This appears at pages 98 and 99 of the transcript.
The transcript (at page 64) also records a remark made by Mr Pershouse, during Mr Bongioletti’s cross examination of the witness Rendell. This record shows that the remark was made about what is depicted in exhibit 11P, namely that:
…the render goes past the top of the floor to break the termite barrier.
That photograph (11P) is of the spot on the north side of the house where the tool or iron line is some 210mm above ground level and the render extends (as on the south side) some 100mm below that tool line, leaving some 110mm of visible concrete.
That interjection is consistent with the Member’s description of evidence given by Mr Pershouse at the original hearing, and consistent with the evidence Mr Pershouse gave on the hearing conducted on 28 May 2012, in which he said that he had made a comment to Mr Bongioletti (over the telephone) about the render coming too far down, and had asked “what had been done about a termite barrier”. He said (in May 2012) that Mr Bongioletti had replied, “it’s all good. Go ahead.” Mr Pershouse said in evidence in May 2012 that he assumed there was a reticulated system in place, which now covered by soil and sand. The other evidence was that that assumption was an error, there being no reticulated system in place at all.
It is appropriate at this stage to reproduce several paragraphs in the reasons for the judgment under appeal:
8. Michael Rendell, Area Manager, QBSA, Maryborough is a licensed builder. He inspected the premises after Mr North’s complaint to the QBSA. He conducted some investigations at the property.
9.In Mr Rendell’s opinion, the property is not compliant with the BCA 3.1.3.0. He explained that some of the major structural elements in the house are not protected and that documents showed that termite resistant material was used in the trusses, frames, and some of the mouldings but not all of them. In particular the window reveals and, probably, the door reveals are not termite resistant. That being so, he said that the BCA 3.1.3.0 required a termite barrier be in place. The barrier can be a physical or visual barrier, which is provided by 75 millimetres of clear off-form smooth concrete visible around the perimeter of the house. This is a slab-face termite barrier. Alternatively, it can be a chemical barrier, which may be provided through a reticulated system or a drill and plug system.
10.Mr Rendell said that a certifier for a new home would require a visual barrier or a reticulated barrier. He said that a drill and plug barrier is a remedy used after there has been an infestation and that it is not usual for approval to be given by a certifier for a drill and plug barrier. He explained that a certifier must be able to satisfy him or her self that this element of the construction is satisfactory. He believes that the BCA would preclude certification of a drill and plug system.
11.He explained that there is no visual termite barrier at the home because the render extends ‘too far down,’ although the concrete path obscures that fact. Mr Bongioletti had told him that there was a visual barrier, namely an exposed flat-edge barrier in place, but that it was impossible to see because of the paving in place. Further, Mr Rendell explained that, obviously, because of the paving, it is not exposed.
12.When Mr Rendell discovered that there was no visual termite barrier, he could not then determine what was there, as he could see render below the exposed slab edge. For this reason, he commissioned the cutting of the concrete paving around the external perimeter of the house in two places, one on either side of the house to expose the base of the exterior wall and foundations of the house.
13.Once the concrete was cut, he was able to see that on one side of the house, the distance between the foundations and the tool line or iron line was 110 millimetres which was at the same height as the concrete path.[4] The render extends to the foundations at a depth of some 4 millimetres.[5] On the other side of the house outside the garage, the distance from the foundations to the tool line was 210 millimetres.[6] In this instance, from the foundations, upwards for some 110 millimetres, a portion of unrendered slab is visible. The rendered area then extends upwards to the tool line for 100 millimetres.
14.He said that it was not common for external concrete paving to be at the same height as the slab, as it is at Mr North’s home. However, Mr Rendell said that if the levels shown in the Slab Plan for the premises[7] accurately depict the construction, there is about 50 millimetres set down from the edge of the slab to the iron joint or construction joint. As I understand it, this means that the height of the slab at the iron joint would be about 50 millimetres. If so, he said then the concrete paving currently complies with the minimum requirements of the BCA.
15.Mr Rendell explained that it is the function of the licensed builder to supervise sub-tradesmen. Therefore, he considered, Mr Bongioletti should have advised the renderer how far the render was to come down. Similarly, he considered it was the builder’s responsibility to advise the concreter of the levels. He considered it was not for someone else to have provided them. However, Mr Rendell could not say who had actually provided them.”
[4] Exhibit 11, photographs 11A-11D.
[5] Exhibit 11, photographs 11E-11J.
[6] Exhibit 11, photographs 11K-11P.
[7] Exhibit 14 at detail D.
The Building Act 1975 defines, in s 12 thereof, the Building Code of Australia (‘BCA’), in these terms:
“… The edition, current at the relevant time, of the Building Code of Australia (including the Queensland Appendix) published by the body known as the Australian Building Codes Board.”
There was no dispute in the proceedings now on appeal from the learned Member, or on the appeal itself, that Mr Rendell had accurately quoted the relevant provisions of the appropriate BCA, or that the appellant was obliged to construct the building in compliance with that code. Section 9 of that Act makes provision for building certifiers, who, by 10, are empowered to give a compliance certificate, stating that building work complies with the building assessment provisions. That is what is asserted in the certificate given to the appellant dated 26 October 2007; and s 30 of the Building Act 1975 provides that building assessment work (defined as the assessment of building development applications for compliance with “these provisions”) be carried out under specified laws and documents, one of which is the BCA.
The first respondent contended in its written submission that the concrete slab, on the northern side of the house, previously assessed by Mr Rendell as compliant with the BCA before the render had come so far down on it, had in fact never been compliant, because of the fold marks and the pitting. The appellant’s position, as put by Mr Bongioletti, was that Mr Pershouse ought to have remedied whatever defects there were in the concrete slab, before laying the footpath and driveway. His evidence on the resumed hearing, by telephone, was that he acknowledged that remedial work was necessary at the house site (to remove the render and to “smooth the concrete”) and that this had not been done. He contended in his final submissions that Mr Pershouse should have been responsible for doing that, and should be obliged to remove the concrete and install a compliant (presumably reticulated) system.
Mr Bongioletti’s evidence and submissions on the resumed hearing reveal that he had departed from the site knowing that there was an inadequate visible termite barrier, and presumably knowing that the render came too far down on one side, and that the concrete was not smooth, “off form” concrete on the northern side. Some of it was, some of it was not. (Mr Rendell’s evidence at the original hearing was that “off form” concrete is a description of concrete once the formwork is removed). Mr North’s photographs provided to the hearing conducted by leave settle that matter against Mr Bongioletti, and the latter called no evidence to establish any common practice in the building industry, or in that area, making it appropriate for a concreter to remedy defectively performed building work. Nothing in the Building Code of Australia suggests that this is appropriate. No questions were ever asked of Mr Rendell (in that part of his evidence that was recorded) to suggest that was common practice, or appropriate.
The Appellant’s application for leave to appeal (on matters of fact) contend that too much weight was placed on the instructions found to have been given to Mr Pershouse by Mr Bongioletti. The Member had heard, and resolved, the conflicting evidence given on that matter, and noted, correctly:
44. The issue is whether Mr Bongioletti instructed Mr Pershouse regarding the specifications for the concreting works.
As to that, the Member considered with care the evidence, and concluded that:
It is reasonable to infer that Mr Bongioletti did instruct Mr Pershouse.
The Member gave reasons, and the only complaint Mr Bongioletti really makes is that “too much weight” was placed on that evidence by the Member, and that there was no “documentary evidence” to support those findings. Since those findings depended upon conversations sworn to by Mr Pershouse, it is unrealistic to expect that there would be documentary evidence. I observe that the learned Member did not treat the statements made to Mr Rendell by the witness Mr Kitney, Mr Pershouse, Mr Bongioletti, and Mr Davies (another witness), as hearsay evidence of the truth of the contents of those statements. Rather, correctly, the learned Member relied on those as original evidence that Mr Bongioletti had given instructions to Mr Pershouse. That conclusion was open to the learned Member, and accordingly the Member was justified in rejecting Mr Bongioletti’s denials that he had instructed Mr Pershouse.
Likewise the Member was entitled on the evidence to accept that Mr Pershouse had specifically raised questions with Mr Bongioletti about the termite barrier, and had been told by Mr Bongioletti that it was appropriate to proceed, and the basis on which to do so.
The appellant’s appeal, on matters of law, contends that the learned Member erred in [43]-[45] of the reasons, submitting that those are “wrong in law”. Those paragraphs essentially record the findings by the Member that it was ultimately irrelevant that Mr Pershouse’s concreting works were done after a final certificate had been issued for the premises, and irrelevant in whose name the concrete was ordered, who was billed for the works that Mr Pershouse had done, and who had paid him. The Member also held that it was irrelevant that there was no written evidence of any contract between Mr Bongioletti and Mr Pershouse.
All of those observations are justified in the circumstances of this case. The appellant had contended that Mr Pershouse was engaged to pour the concrete, and paid for his work, by a party other than it, and the concrete was not ordered by it. The evidence supported those contentions by the appellant, but I respectfully agree with the Member that they were ultimately irrelevant, and that the critical issue was whether Mr Bongioletti had instructed Mr Pershouse about the height to which the concrete could be poured.
The Appellant did not challenge the Members conclusion (in [50]) that:
A duty to take reasonable care was owed to Mr North by Paul Bongioletti Homes and to Mr North by Mr Pershouse.
That conclusion followed from the Member’s references in [33] of the judgment to the decisions of the High Court of Australia in Bryan v Moloney (1995) 182 CLR 609, and Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515. In the first case, the High Court held that a professional builder may be liable in negligence for damages for pure economic loss suffered by a subsequent purchaser. In the second decision, the High Court declined on the facts to extend that principle to the construction of a commercial building, emphasizing in the joint reasons in the second decision that in Bryan v Moloney the Court held that:
The builder of a dwelling house owed a subsequent purchaser of the house a duty to take reasonable care to avoid the economic loss which the subsequent purchaser suffered as a result of the diminution in value of the house when the fabric of the building cracked because the footings were inadequate.
The joint reasons in Woolcock Street Investments explain that the decision in Bryan v Moloney was given on the grounds that it was foreseeable economic loss would result from negligent construction of a house; there was no intervening negligence or other causative event; and, the builder had owed the same duty of care to the first owner because of the assumption of responsibility (by the builder), and the known reliance, (by the owner of the building), on the builder.
Although the learned Member did not so remark, the conclusion is open here, and I readily draw it, that the appellant had breached its duty of care to the developer by erecting a building without a complying termite barrier. It is irrelevant that a “final” certificate was provided under the provisions of the Building Act 1975, because the evidence establishes that that building was not in fact compliant with the provisions of the BCA, and it did not become so because a building certifier had issued a certificate. Mr Pershouse had contracted to place a concrete path around a house which did not in truth have a complying termite barrier; and the appellant’s client, the developer, had been exposed to the foreseeable possibility of economic loss before Mr Pershouse was engaged.
The appellant’s position, as I understand it, is that the conduct of Mr Pershouse, by laying the concrete as he did and where he did, was itself in breach of the BCA (as described earlier), and this conduct constituted an intervening causative event, and an example of intervening negligence, for which the appellant should not be liable. But if Mr Pershouse was in breach of the BCA, in building the concrete path as he did, it remains the Members finding that Mr Pershouse, “had to rely upon the advice from the builder” ([52] of the reasons). In any event, whatever Mr Pershouse did at the site, the building did not comply with the BCA requirements that the house have an external termite barrier: either a visual or chemical barrier. It had neither, and was vulnerable to termite infestation. The learned Member so found, and I respectively agree that that finding was both open, and unavoidable. The Member found that, and I agree, the appellant had failed to provide the house with a termite barrier and had breached its duty to take reasonable care to construct a house with a termite barrier and comply with BCA requirements for a termite barrier to be in place. The Member also found that Mr Pershouse had not breached his duty of care (which the Member found Mr Pershouse did owe), and the Member’s reasons were as follows:
He acted as instructed and the evidence of Mr Rendell is to the effect that provided the house was built in accordance with the slab plan, then the concreting complies with the BCA. Accordingly, I am satisfied that he has not breached his duty of care.
I confess to finding it hard to grasp the reasoning in that paragraph of the judgment under appeal, because whatever the provisions of the slab plan[8] (which apparently implied that a 50mm concrete slab face would be visible above the concrete path after it was laid), the point is that the concrete path was laid level with the top of the house slab, and any (in fact non existent) unrendered good quality off form concrete was obscured. Accordingly, Mr Pershouse may have been fortunate in the dismissal of the case against him, but the appellant, while blaming Mr Pershouse, has not actually appealed against what was effectively the dismissal of the claim against the then second respondent, Mr Pershouse. Further, the appellant’s position is that Mr Pershouse ought to have remedied the position left by the appellant, namely a house with no complying termite barrier, when there is no evidence that Mr Pershouse was told the house lacked a termite barrier. Mr Pershouse’s evidence is to the contrary, in that he says he assumed a reticulated system had been put in place, because there was plainly enough no visible termite barrier, a matter he had raised with Mr Bongioletti and upon which he contended he had been reassured. Accordingly, if his concreting work was in breach of the BCA, it merely served to mask the fact that there was no visible termite barrier prior to the performance of that work. It simply made it slightly more difficult to establish the fact of a breach of duty by the appellant. I therefore reject the appellant’s contention that Mr Pershouse’s conduct, and not its own, was the cause of loss to, ultimately, Mr North.
[8] Exhibit 14 in the first proceeding.
The learned Member quantified that loss as a cost of rectifying the defect, setting that figure at $15,546.60.[9] In this appeal Mr North has led (without objection) evidence of the expenditure of further money on eradicating the termite infestation that occurred in February 2012. He has calculated the paid and quoted costs of that at a total of $907.47, and has invited the appellant (by letter dated 3 April 2012) to pay him that sum. I understand this has not happened. In the circumstances, I consider it appropriate, while otherwise confirming the decision, to amend order 1, by deleting there from the figure “$15,546.60” and inserting instead the figure “$16,454.07”.
[9] At [55] of the judgment.
I order that the appeal and application for leave to appeal lodged herein on 17 May 2011 be dismissed, and further order that the decision under appeal is amended by deleting from order 1 made on 18 April 2011 the figure “$15,546.60” and inserting instead the figure “$16,454.07”, and otherwise confirm the decision appealed from.
2
0