Perrin v McGown
[2011] QCAT 566
•16 November 2011
| CITATION: | Perrin v McGown [2011] QCAT 566 |
| PARTIES: | Mr John Perrin |
| v | |
| Mrs Lesley McGown trading as McGown Building & Maintenance |
| APPLICATION NUMBER: | REO004-11 |
| MATTER TYPE: | Building matters |
| HEARING DATE: | 4 November 2011 |
| HEARD AT: | Hervey Bay |
| DECISION OF: | Peter Walker, Member |
| DELIVERED ON: | 16 November 2011 |
| DELIVERED AT: | Brisbane |
ORDERS MADE: | 1. The Applicant pay the Respondent the sum of $38,048.98. |
| CATCHWORDS: | Building works – whether agreed hourly rate – quantum meruit – assessment of damages Domestic Building Contracts Act 2000 |
APPEARANCES and REPRESENTATION (if any):
| APPLICANT: | Mr John Perrin |
| RESPONDENT: | Mrs Lesley McGown |
REASONS FOR DECISION
Background
The Respondent (McGown) was a builder that entered into oral agreements to perform building works for the Applicant (Mr Perrin) as follows:
a. On Mr Perrin’s home at 29 Puller Street, Maryborough (Puller St);
b. On the Bells Vue Hotel, corner of Lennox Street and Ellenna Street, Maryborough, being commercial premises also owned by Mr Perrin.
The works were the subject of 4 different tax invoices which are attached to the original application filed in this matter. Of those McGown says two remain outstanding, namely those numbered 655 and 661 totalling $38,048.98. It is clear that the other amounts totalling $47,473.46 have been paid.
Issue for Determination
There were a couple of different issues raised in documentation about the matters to be determined by me. There was one issue relating to an allegation of overcharging, and another issue relating to the quality of work performed in the Bells Vue Hotel job.
I elected to deal with these on an issue by issue basis and dealt with the overcharging issue first. However after that was concluded Mr Perrin advised me that he needed further preparation relating to the quality of works and alleged defects and would pursue that separately in other proceedings.
Accordingly I did not hear any evidence, and did not make any determinations on the allegations relating to the quality of works.
I turn then to the sole dispute between the parties that I was to decide, namely whether there was any agreement about a method of calculating the price and what the price should be.
The Evidence
The only witnesses called were Mr Perrin personally and Ms Elizabeth McGown for the Respondent.
It is common ground that there were no written contracts in respect of either job.
Mr Perrin says it was agreed that both jobs would be costed on the same basis, namely that wages would be charged at cost plus 40% and that this was an agreement he reached with Ms McGown at a discussion at her work premises and detailed in an affidavit filed in these proceedings.
For her part Ms McGown says that this was nothing more than a general discussion about methods used to calculate costs and the reference to 40% was made but the figure was a cost only figure and did not include a profit margin.
Mr Perrin gave evidence that he believed he had been charged $50.00 per hour for all workmen, including an apprentice, who worked on his jobs. He said that if the rates he says had been agreed upon were applied he has been overcharged by a figure in excess of $13,000.00.
He did not give me any actual calculations to support this figure and I have been unable to work out the basis for it.
Mr Perrin did specifically accept the amount charged for materials and he also accepted that the hours alleged to have been worked were reasonable. In fact he said that on his calculations the hours worked were in excess of that claimed for.
The hours apparently charged were contained within exhibits tendered by Ms McGown.
Mr Perrin’s sole complaint arises from the hourly rate said to have been charged. In this respect he says that he was told by Ms McGown that she charged out all workers who left her yard at the rate of $50.00 per hour.
For her part Ms McGown says she remembers a general conversation along these lines but says that it was not exactly in these terms. She says that the usual rate was in fact $55.00 per hour plus GST. She says, however, that this conversation did not relate to the works which they performed for Mr Perrin, which she says, in respect of Puller St was costed at $39.65 plus GST per hour and for the Bells Vue was charged at a slight discount of about $51.00 plus GST per hour.
Mr Perrin said that that these figures do not correlate with the amount actually charged and that in fact he has been overcharged by a significant amount.
In fact Invoice number 655, which is the one that relates to the Bells Vue contract states that Brett Baxter was charged out at $30.00 per hour and carpenters at $50.00 per hour.
Legal Issues – Puller Street
As a matter of law it seems to me that the two jobs need to be considered separately. The Puller St contract, being in respect of Mr Perrin’s home, is governed by the provisions of the Domestic Building Contracts Act 2000 as it involved “Domestic Building Work” within the meaning of section 8(1) of the Act. Accordingly the contract ought to have been in writing. Therefore the contract itself is void and the builder can only recover on a quantum meruit basis. In other words it can only recover the value of the work performed.
Despite seeking input from the parties on this matter they did not provide any. Specifically they did not suggest that I should approach the matter on any basis other than a reasonable charge out rate plus materials. Accordingly I have elected to adopt such an approach.
Accordingly, while I have considered the discussions between the parties and their beliefs about what or what may not have agreed, I don’t believe the law strictly requires this of me, as even if there was an agreement in this respect, such an agreement would be void.
I have been informed by Mr Perrin that the amounts he has been charged do not accord with any agreement and he does not understand them.
Findings – Puller Street
For my own part I do not have any trouble understanding the basis of the charge. So far as it relates to labour on Puller St it is based on a total of 824 hours.
Of those hours 282 seem to have been performed by an apprentice, Brett, and the balance by tradesmen.
Mr Perrin has said he calculated the rate that he should have been charged himself, and based it on information provided directly by the tradesmen. Based on those figures he said he should have been paying $31 per hour for the apprentice and $45.00 per hour for the others. When I expressly asked him whether these figures were inclusive or exclusive of GST he replied that he didn’t think GST would be payable.
If one recalculates the figures using Mr Perrin’s figures, in respect of Puller Street one in fact comes up with a higher figure than was actually charged.
In respect of the Puller St property Mr Perrin stated he had no problems with any of the workmanship. I am therefore satisfied that the amount charged was a reasonable figure having regard to the value of works performed and should be allowed in full.
Legal Issues – Bells Vue
In respect of the Bells Vue Hotel somewhat different principles apply as those works are not subject to the Domestic Building Contracts Act 2000. Hence an agreement between the parties may be enforceable.
Findings – Bells Vue
The sole evidence about what may or may not have been agreed to is said to be contained in the conversation between Mr Perrin and Ms McGown. So far as this is concerned, while I have no doubt that Mr Perrin believed that any work done would be charged on the basis of wage cost plus 40% I am not convinced that Ms McGown shared this understanding. Specifically the fact that the parties agree that no specific rates were actually discussed on this date and also there was no discussion of GST lead me to believe that the more likely scenario was that Ms McGown believed this was nothing more than a general discussion between two businessmen about the way prices are calculated.
Accordingly I find that there was no agreement reached about the rates that would be charged. So far as I can see then there was no restriction upon what McGown was entitled to charge.
Given that there was no dispute about the material cost or the hours of work performed I find that the amount invoiced by McGown is due and payable by Mr Perrin.
Costs Claim
Generally the Tribunal is a no costs jurisdiction. I was not given any reason to depart from this principle in this matter. Accordingly so far as the claim relates to legal costs incurred in attempting to recover the sum said to be due I do not intend to allow it.
I therefore find that Mr Perrin should pay McGown the sum of $38,048.98 and order accordingly.
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