Pihir v Galvin
[2007] SADC 13
•1 March 2007
District Court of South Australia
(Civil)
PIHIR & ANOR v GALVIN
[2007] SADC 13
Judgment of His Honour Judge Burley
1 March 2007
DAMAGES
Claim for damages for breach of building contract - liability admitted - what is reasonable cost of remedial work to domestic dwelling - time at which damages are to be assessed.
Burns v MAN Automotive (Australia) Pty Ltd (1986) 161 CLR 653 , considered.
PIHIR & ANOR v GALVIN
[2007] SADC 13
In these proceedings the plaintiffs have claimed damages in contract and tort in respect of building work carried out by the defendant at the plaintiffs’ residence at 89 Kingfisher Circuit, Flagstaff Hill (“the dwelling”). Paragraphs 1 to 8 of the Amended Statement of Claim are admitted in the Defence and the following summary of the plaintiffs’ claim is based on those admissions.
At all material times the plaintiffs were the owners and occupiers of the dwelling. The defendant carried on business as a landscaper and builder. In about March 1999 a contract was entered into between the parties whereby the defendant was to perform certain building and landscaping work in respect of the dwelling for the sum of $51,350. The contract arose from the acceptance by the plaintiffs of a quotation from the defendant dated 2 March 1999. The plaintiffs rely upon statutory warranties provided for in s32(3) of the Building Work Contractors Act 1995. It is not necessary to deal with this aspect of the matter because, shortly after the commencement of the trial on 9 October 2006, the parties came to an agreement in relation to the question of liability. Consequently all that I have been concerned with since that agreement is the question of damages.
The plaintiffs have also based their claim in tort, but again it is not necessary to deal with that question in any detail because both parties accept that the measure of damages is the same whether the claim is based in contract or tort.
Damages are sought under two headings. At paragraph 1 of the plaintiffs’ written closing address, it was stated:
1. The plaintiffs seek an award of damages ($49,492) comprising the following:
1.1 costs to undertake remedial works $44,592;
1.2 costs of alternative accommodation $4,900 (five weeks, being 35 days, at $140 per day).
The parties have agreed that if the cost of alternative accommodation is to be awarded, the correct rate is $140 per day.
In order to understand the nature of the works carried out by the defendant pursuant to the building contract, reference should be made to Exhibits P1 and P2 which are respectively plan drawings of the dwelling before and after the completion of the building works carried out by the defendant. The work carried out by the defendant was in relation to a courtyard area. I have annexed to these reasons a photocopy of the courtyard shown in Exhibit P1 and the courtyard shown in Exhibit P2.
The original plan, P1, provided for a smaller courtyard with stairs leading to a landing and thence to ground level. The plaintiffs wished to extend this courtyard and engaged the defendant to do so. The area was approximately doubled by projecting the courtyard in a northwards direction and providing for stair access to ground level at the eastern end of the enlarged courtyard. It is to be noted that the respective copies of parts of Exhibits P1 and P2 show the house as running in an east/west direction with east at the top of the page and west at the foot of the page. Consequently north is to be left and south is to the right of the page.
Exhibit D4 is a copy of two photographs showing the courtyard prior to the commencement of work by the defendant. These photographs depict two walls set at right angles, the tops of which are roughly level with the floor level inside that part of the house which immediately abuts the courtyard. On the copy of portion of Exhibit P1, these are shown as L-shaped, the shorter part of the L running north/south and the longer part of the L running east/west. In the copy plan of portion of Exhibit P2, these walls are described by dotted lines so as to represent what was common ground, namely that the floor of the extended courtyard extended over the top of the L-shaped walls. For the purposes of this case, the L-shaped wall which is of significance is the eastern wall. During the course of evidence it has been referred to as “the eastern wing wall” and I shall continue to use that description.
In broad terms, the building works to be carried out by the defendant consisted of the construction of two retaining walls, one of which commenced at the north-eastern corner of the garage and proceeded in an easterly direction until it was level with the western wall of the kitchen. The other retaining wall ran in a north/south direction from the north-western corner of the kitchen in a northerly direction through to the end of the east/west retaining wall. It can be seen that the plan also provided for a stairway, access to which was gained through an entry situated alongside the north-western corner of the kitchen.
Over the top of the northern and eastern retaining walls, the defendant built lightweight courtyard walls so that the courtyard was enclosed, the only openings being into the house at the southern end of the courtyard and to the stairway along the eastern wall of the courtyard. The work carried out by the defendant included the provision of fill in respect of the entire courtyard and the compaction of same. A layer of concrete was then spread on top of the compacted fill and on top of this concrete paving blocks were laid. These blocks were attached to the underlying concrete base.
At the commencement of the trial a view of the site was undertaken and it could be seen that the floor of the extended courtyard was roughly level with the floor inside the upper level of the house. The floor extended throughout the courtyard, apart from a garden and fountain area provided in the northern part of the courtyard.
I mention also that the dwelling has a lower ground floor which contains a bathroom immediately underneath the kitchen. The kitchen/bathroom wall is part of the eastern boundary of the courtyard.
It was common ground that, prior to the defendant undertaking work pursuant to the contract, the plaintiffs had experienced dampness along the kitchen/bathroom wall and that work had been carried out prior to the defendants entry onto the site, in order to resolve the dampness problem. This has been referred to as the HIA indemnity waterproofing work.
The essence of the plaintiffs’ case is that dampness in the bathroom and at the base of the eastern retaining wall constructed by the defendant occurred after the completion of the building works by the defendant.
The defendant has accepted responsibility for the incursion of dampness to the extent that he failed to provide adequate waterproofing of portions of the western face of the eastern retaining wall and the northern face of the eastern wing wall. In addition he accepts that he failed to waterproof the western face of the kitchen/bathroom wall and part of the western face of the retaining wall.
That description of the admissions of the defendant is not meant to be comprehensive. The extent of the admissions made by the defendant have been documented by reference to the report dated 4 September 2006 of Mr Goldfinch, an engineer engaged by both parties shortly prior to the commencement of the trial. This report has been admitted as Exhibit P5.
At page 2 of his report Mr Goldfinch provided a summary of recommendations as follows:
In my opinion the remedial works will require membrane-type waterproofing to the soil-retaining face of a one metre minimum length of the eastern concrete retaining wall installed by Mr Galvin with the same treatment being necessary in the area where the original east/west ‘wing’ wall (now buried beneath paving) abuts the north-western corner of the lower ground level bathroom. My proposal involves cutting back the wing wall by a minimum of 400mm to allow access to the former HIA indemnity waterproofing work already applied along the western retaining wall of the bathroom.
It is necessary to set out the detailed specification of remedial work contained in Mr Goldfinch’s report because it is by reference to this that the assessment of damages must be made, at least insofar as those damages consist of the cost of remedial work. The claim of the plaintiffs in relation to remedial work is limited to that which has been accepted by the defendant as his responsibility. The relevant parts of Mr Goldfinch’s report are as follows:
11.0 SCOPE OF WORK TO WATERPROOF LOWER GROUND FLOOR BATHROOM
1.1Waterproofing and Overflashing to Top of Previous Work by HIA Indemnity
1.1.1 Mark the existing top of paver level on the wall face with lead pencil then carefully remove a single row of pavers and any basecourse mortar or sand beneath same to fully expose the section of substrate slab at the abutment joint where the slab rests against the house wall over the full linear extent of the previous waterproofing works conducted by HIA Indemnity.
1.1.2 Lay a generous linear strip of Emer-Seal PU40 flexible sealant to form a defined coving along the slab-wall abutment joint ensuring application of finger pressure to smooth and properly bed the polyurethane sealant into the right angled joint (refer Fig. 1 below).
1.1.3 Form a horizontal cut using an angle grinder along the pencil line at the top edge of the paving ensuring the cut is of sufficient depth to accept a PVC trim angle (James Hardie) to act as an overflashing to protect the top edge of the proposed waterproofing treatment.
1.1.4 Thoroughly clean the slab and upstand wall surfaces and for the horizontal slab surface over a minimum width extending out from the house wall of 200 mm, also trimming off any exposed orange coloured Fortecon polythene membrane projecting above the slab.
Over the cleaned slab surface for a width of 200 mm apply a thin coating of Renderoc FCI fairing mortar and allow to cure in accordance with the manufacturer’s recommendations.
1.1.5 Using roller application apply a first coating Emer-proof 750 elastomeric waterproofing compound to form a continuous membrane extending a minimum of 200 mm over the horizontal slab surface and vertically up the adjacent wall face to the pencil line (i.e. to top of replacement pavement level).
After the “tack” dry stage of curing of the first coat has been achieved apply a second continuous coating of Emer-proof 750 to build up the combined two coat dry film thickness (DFT) to a minimum of 2.5 mm thickness to the slab and wall. If a 2.5 mm DFT is not achieved with a two coat application apply a third coat to complete the joint waterproofing.
1.1.6 After a 48hr cure period the Emer-Proof membrane shall be protected by applying a light “dust” coating of neat cement powder directly on to the Emer-proof material and by then standing against it a length of Kordon damp-proof/termite barrier both of which shall be protected by Impraboard placed vertically against the wall and contained within the PVC overflashing angle at its top edge.
This will prevent peeling (i.e. delamination) over time and protect the waterproofing and Kordon from UV exposure. The PVC angle shall be held in place by sealing along the wall cut using Emer-seal PU40 trimmed and smoothed to achieve a neat finish (select a sandstone or cream colour if possible).
1.1.7 Replace the pavers on bedding to match the existing [pavers].
1.1.8 Finally run a bead of Emer-seal PU40 sealant along the top 10 mm depth and width of the paver joint abutting the vertical house wall (refer Fig. 1 below).
Figure 1 referred to in paragraph 1.1.8 sets out the detail of the way in which the seal is to be effected.
The next recommendation of Mr Goldfinch, set out at paragraph 1.2 of his report, deals with site access and excavation.
At paragraph 1.2.1 he recommends the cutting of a rectangular access opening in the eastern garage wall of a width sufficient to allow earthmoving plant to be moved into the courtyard area. This aspect of the matter is not the subject of agreement between the parties. The defendant’s position is that there is no need to cut an opening in the eastern wall of the garage because the excavation of the required areas may be carried out both by hand and by the use of an electric jackhammer, in which event, access to the courtyard area to carry out the excavation and to remove the spoil during the excavation work may be obtained by the erection of suitable scaffolding along the eastern and northern walls of the courtyard area continuing in a westerly direction alongside the garage wall up to the point where the driveway commences immediately in front of the garage.
Nevertheless, the defendant agrees with the remainder of paragraph 1.2 which is as follows:
1.2 Site Access and Evacuation Behind Eastern Concrete Ret. Wall in Courtyard
…
1.2.2 Remove paving blocks on the northern side of the buried east-west wing wall then saw-cut into portions and remove the substrate concrete slab to the north of the wing wall to allow access to excavate soil from the corner where the original wing wall, the new concrete retaining wall and the house wall all meet. The aim of this exercise being to expose a minimum 2 metre length of the eastern concrete retaining wall and at least a one metre width of its concrete footing and to also expose a minimum 2 metre length of the wing wall to the west of the house wall with both excavations extending down to top of footings level.
1.2.3 Note that the cut concrete slab sections and soil removed shall be taken from the site to a place of legal disposal and dumped.
1.2.4 A combination of lowering the overall soil level and benching and battering of the north and west sides of the excavation will be required and if necessary shored to achieve stability of the exposed earth bank for the during of the following works.
1.2.5 At the base of the external eastern retaining wall staircase cut out and remove a panel of existing concrete paving from the house corner for a length of 2 metres along the retaining wall. This is to allow excavation for and ultimately connection of a DN40 PVC weep hole pipe to a rear courtyard sump and connection to the same sump of a new DN90 PVC stormwater pipe from the upper level courtyard.
1.2.6 At a distance of 500 mm back from the house wall and at the base of the eastern concrete retaining wall install a new 40 mm diameter weep hold drain at the base of the wall/top of footing by removing a 50 mm diameter concrete core as shown in Fig. 2 below and then fitting a DN40 PVC pipe sealed at both ends with Emer-seal PU40. Also remove a 100 mm diameter concrete core approximately 200 mm further north at the base of the concrete retaining wall to provide sleeving for a new DN90 PVC drain outlet coming from a proposed new courtyard sump (refer Item 1.5.2 to follow).
In paragraph 1.4 of his report Mr Goldfinch has set out his specifications in relation to new waterproofing application as follows:
1.4 New Waterproofing Application
1.4.1 Apply a fairing coat of Renderoc FC in accordance with the manufacturer’s technical data sheet to smooth over any inherent roughness, honeycombing, pinholing or the like on the vertical and horizontal masonry and concrete surfaces. The fairing coat shall be kept as thin as possible and only of sufficient thickness to provide a smooth surface to receive a roller applied, elastomeric waterproofing membrane.
Clean debris from the vertical construction joint where the eastern concrete retaining wall abuts the masonry house wall by cutting into the joint to a minimum depth of 8 mm using an angle grinder then thoroughly cleaning out the joint and filling with Emer-seal PU40. Apply a 50mm wide bond breaking tape centred over the sealant filled joint and then overtop this with a first continuous coating of Emer-proof 750 to a minimum width of 100 mm on each side of the joint (i.e. approx. 200 o/a width). Allow this to cure overnight then apply a second continuous coating of Emer-proof 750 and allow to cure to “tacky” state.
1.4.2 Insert generous beads of smoothed Emer-seal PU40 sealant along all right-angled joints such as at the wall/footing joint and footing/footing joint.
Apply two continuous coats of Emer-proof 750 to manufacturer’s instructions to achieve a minimum DFT of 2.5 mm over the prepared vertical and horizontal surfaces extending vertically upwards to the intended top of pavement base preparation and extending a minimum of 500 mm width across the horizontal concrete footing. The treatment shall cover a minimum wall length along the eastern concrete retaining wall of 1 metre back from the house wall.
1.4.3 Allow 48 hours cure time then place a dust coating of neat cement powder over the full extent of the Emer-proof 750 followed by immediate placement of Kordon blanket (lapped 200mm at joints & taped) and protective fluted polyethylene sheets such as Impraboard (this comes in 1.83 m x 1.2 m sheet size) which shall be connected along joints with 50 mm duct tape to form a continuous protective sheet covering to both the vertical and horizontal waterproofing work.
The Kordon and protection board shall extend up to the intended top of pavement base preparation where a horizontal PVC angle overflashing is to be installed within a horizontal cut along the concrete wall, sealed in place with Emer-seal PU40 to prevent peeling (i.e. delamination) from the substrate wall surface.
The agreement between the parties included the addition of a specification which for convenience has been included as paragraph 1.4.4 which is as follows:
1.4.4 The northern face of wall X and southern end of the Galvin retaining wall (see Combe plan 5/10/06 attached) along with the footing be waterproofed and tanked in accordance with this (the Goldfinch method) for a one metre length.
Translated, this means that the defendant is required to waterproof the northern face of the eastern wing wall in the manner specified for waterproofing by Mr Goldfinch for a distance of 1 metre west of the eastern end of the eastern wing wall.
Paragraph 1.5 of Mr Goldfinch’s report provides for the backfilling of the excavation. The defendant has accepted these recommendations. Paragraph 1.5 is as follows:
1..5.1 Clean up the site and remove all debris to a place of legal disposal.
1.5.2 Fill a sarlon cloth wrapped bag of proportions approximately 400 mm x 400 mm x 400 mm with 20 mm clean washed gravel and install same against the exit point of the DN40 PVC weep hold pipe located at the top of the eastern concrete retaining wall footing. Install a new 300 mm x 300 mm x 300 mm polyethylene sump and grate to the courtyard on the north side of the “wing” wall with a DN90 PVC outlet pipe connecting from this sump across to the eastern retaining wall to which it shall be fixed (note no fixings to penetrate the waterproofing work) to then feed out through the pre-cut 100 mm core hole then seal gap between pipe and hole with Emer-Seal PU40.
1.5.3 Import new non-dolomitic quarry rubble filling supplied to site at its optimum moisture content and compact in 200 mm thickness layers using a leg type ramming device up to the desired level of sub-base to suit pavement replacement.
1.5.4 Place an 0.2 mm polythene concrete underlay then replace the original substrate base slab by dwelling into the existing cut slab edge and concrete ret. walls using N12 dowels spaced 500 mm apart set 100 mm deep into 14 mm diameter epoxy filled dowel holes (use Megapoxy HT or similar). The new nominal 100 mm thickness slab shall be reinforced with SL72 steel mesh placed 30 mm from its top face. Use grade N20 concrete x 80 mm nominal slump. Finally replace flagstone paving previously removed.
The next item of agreement between the parties is contained in paragraph 3.4 at page 13 of Mr Goldfinch’s report. It is as follows:
3.4Cracked and delaminated (i.e. drummy) cement render on the outer northern retaining wall, and elsewhere should it be found to be present, shall be removed back to substrate concrete and replaced using an epoxy bonding coat of Megapoxy HT (available from Resimax) applied strictly in accordance with the manufacturer’s instructions. This hydrophic epoxy can also be thickened to towellable consistency by the addition of 16/30 grade clean washed quartz sand which can then be overcoated with an acrylic textured coating to match the existing wall finish.
Paragraph 5 of Mr Goldfinch’s report deals with remedial works in relation to the lower ground floor bathroom. This has been agreed to by the defendant. The paragraph is as follows:
5.1Remove existing moisture damaged plasterboard wall linings from the entire extent of the western bathroom wall.
5.2Use a wire brush technique to remove crystalised salt deposits from the western wall and then clean down using Eff-Ex (Aquamix product) heavy-duty cleaner designed to remove efflorescence. This product shall be applied strictly in accordance with the manufacturer’s instructions. Technical literature is attached.
5.3Apply a single coat of Vandex BB75-Z cementitious waterproofing membrane to the exposed masonry surface along the full extent of the western wall and in so far as it is practically possible along the internal northern wall masonry where the plasterboard lining has been removed in the north-western corner. This product shall also be applied strictly in accordance with the manufacturer’s instructions. Technical literature is attached.
Allow a 48 hour cure period and then fix 85 mm x 19 mm reeded Merbau (often used for decking timber) battens against the western wall at a centre to centre spacing of 450 mm and screw fixings at 600 mm vertical centres.
Install 6 mm thickness Villaboard lining to the western wall and make good damage to the plasterboard opening in the northern wall at the north-western corner.
Prepare for painting by sanding smooth along sheet joints.
Remove all construction debris from the site to a place of legal disposal and leave the bathroom in a clean and tidy state.
It is against this background that two major issues arise for determination. They are:
The amount of damages to be awarded for remedial work which includes determining the date at which damages are to be assessed.
Whether damages for alternative accommodation should be awarded and if so, for how much.
Damages for remedial work – time at which to be assessed
The evidence relating to the time at which damages are to be assessed includes the evidence of the plaintiff (the defendant did not give evidence), the evidence of Mr Combe and documentary evidence regarding dealings between the parties after the completion of the building works by the defendant.
The question of the time at which damages are to be assessed is confined to the damages for remedial work. It is not necessary to consider this point in respect of the cost of alternative accommodation because the parties have agreed the daily rate at $140.
I refer first to the evidence of Mr Combe and the use to which it may be put. His report of 21 April 2005 was tendered. It is Exhibit P16. Annexed to that report is a Scott Schedule which sets out Mr Combe’s response to a claim for damages amounting to $83,050 made by the plaintiffs against the defendant in respect of remedial work. No mention was made of the report and the Scott Schedule by counsel during their closing addresses for the good reason that the plaintiffs, at trial did not pursue a claim for $83,050. More importantly, the plaintiffs did not seek to rely upon the estimate referred to in the relevant column of the Scott Schedule referred to by Mr Combe, nor did the defendant rely upon Mr Combe’s response thereto. The claim for damages was based principally on the evidence of Mr Palmer and the defence to that claim was based solely on the evidence of Mr Burr. For the sake of completeness, the report of Mr Combe dated 11 April 2000 was tendered and became Exhibit D14. In his report Mr Combe referred to an attendance at the dwelling on 12 February 2000 and that his report of 11 April 2000 is based on that inspection. Given the agreement reached between the parties on questions of liability, the relevance of both reports is confined to the question of dealings between the parties after the completion of the building works by the defendant, about which I will have more to say later in these reasons.
Both parties, in their respective final addresses, put submissions on the question of mitigation of damages. The defendant, who addressed first, submitted that there had been a failure to mitigate damages by the plaintiffs in that they had unreasonably delayed in the bringing of proceedings. The plaintiffs denied that any action or inaction on their part constituted unreasonable behaviour. Both parties proceeded on the basis that in the absence of facts supporting a contention of failure to mitigate, damages were to be assessed as at the date of trial. I have therefore approached this question from that standpoint.
Mr Pihir, in his evidence, said that the plaintiffs first experienced problems with dampness in about November 1999 which was when the defendant was in the process of completing the building works he had contracted to do. Mr Pihir said that he pointed out to the defendant the presence of moisture in the bathroom immediately below the kitchen and he said that the defendant did not accept that he was responsible for that incursion of moisture. (T.215-216)
By letter dated 31 January 2000 (Exhibit D11), the plaintiffs asked the defendant to attend a meeting at the site on 11 February 2000. It is apparent that by this time the plaintiffs had retained a Mr P Jankovic, a building consultant. Mr Galvin attended that meeting with Mr Combe. Apparently at that meeting it was arranged that Mr Combe would prepare a report as to his findings.
By facsimile transmission dated 3 April 2000, Mr Jankovic wrote to Mr Combe and to the defendant expressing concern that a report had not yet been provided and requesting that the same be forwarded as soon as possible. Mr Combe subsequently provided his report of 11 April 2000. It is apparent from Exhibit D13, which is a letter dated 20 April 2000, that the plaintiffs obtained Mr Jankovic’s advice about Mr Combe’s report of 11 April 2000.
The next contact between the parties consisted of a letter of demand dated 4 June 2002 from Messrs Lynch Meyer, the plaintiffs’ solicitors, to the defendant. That letter forms part of Exhibit P26. The other two letters of July 2002 and November 2002 which form part of the exhibit, consists of correspondence between the plaintiffs’ insurer and a loss assessor for the insurer respectively.
The defendant contends that the inaction on the part of the plaintiffs between mid April 2000 and early June 2002 constituted an unreasonable delay in pursuing the claim the subject of these proceedings. No complaint has been made by the defendant about the time that it has taken to bring the matter to trial after the initial letter of demand.
It was submitted that the delay of just over two years between April 2000 and June 2002 could not be justified by the evidence called by the plaintiffs on the point. It was submitted that the consequence of the alleged unreasonable behaviour on the part of the plaintiffs was that damages should not be assessed as at the date of trial but instead, as at a period of two years prior to trial. The trial commenced in October 2006, it was adjourned to December 2006 to enable evidence to be called as to the quantum of damages and, because the parties were not able to complete the trial within the allotted time, it was then adjourned to the end of January 2007 when, after a further two hearing days, the trial was completed.
The plaintiffs submitted that it was reasonable for them during the relevant two year period to delay the commencement of proceedings because they were in the process of having children and they had to borrow against their home mortgage to fund the litigation. Reliance was placed upon the decision of the High Court of Burns v MAN Automotive (Australia) Pty Ltd (1986) 161 CLR 653. That case involved the purchaser of a truck suing for damages for breach of a warranty that the truck, when it was purchased, had a reconditioned motor. The question of what the appellant was required to do in mitigation of his damage was addressed by Gibbs CJ (at 658) where his Honour said:
However, the appellant was bound to take all reasonable steps to mitigate the loss, and one course open to him to mitigate the damage, if he could have afforded to take it, was to have the engine reconditioned or to buy another to replace it. However, his impecuniosity prevented him from taking that course. The question arises whether it should be held that the appellant is debarred from claiming such part of the damages as is attributable to his failure to take the necessary steps in mitigation, when he was unable to take those steps because of his lack of means.
His Honour came to the view that the plaintiff was not precluded from recovering such damages. This is a far cry from the present case, where it is said that the plaintiffs had eventually to borrow against their mortgage in order to fund the litigation. As far as I am aware, the inability of a plaintiff to fund litigation has never constituted an exception to the rule that a plaintiff must act reasonably in the mitigation of damages. I therefore do not consider that Burns v MAN Automotive Pty Ltd assists the plaintiffs in this case. In addition, I do not consider that the matters relied upon by the plaintiffs to justify the two year delay are sufficient. In my view there has been an unreasonable delay of approximately two years in the prosecution of the proceedings and it would be unfair to saddle a defendant with damages assessed at a date two years after the assessment would have taken place had the plaintiffs not been guilty of unreasonable delay. It is for these reasons that I consider that the date of assessment of damages should be as at about December 2004. I have chosen that month because the trial took place between October 2006 and January 2007. I have also made allowance for the fact that about two months should be allowed for the plaintiffs to have issued a letter of demand after receipt of the report of 11 April 2000.
Given that both Mr Burr and Mr Palmer have formulated their estimates for the cost of remedial work by reference to current prices, it will be necessary to adjust whatever figure is ultimately arrived at to take account of the increase in building costs since about December 2004. This is not an easy task, given that the evidence from both Mr Palmer and Mr Burr in relation to cost increases was necessarily of a general nature. I think it fair to say that both were of the view that building costs had doubled since the introduction of GST. It was Mr Burr’s evidence that prior to the introduction of GST, for a number of years, building prices had been stable and that the industry, irrespective of the introduction of the tax, was due for a cost increase. Mr Burr said that when builders were required to add 10% to their costs to reflect the payment of GST, they instead added 30% to their existing costs to reflect not only the GST but also the fact that there had not been cost increases in the building industry for a number of years prior. Mr Burr said that after this jump there was a continued increase in building costs. As I understand Mr Palmer’s evidence he was of the view that building costs have increased substantially in recent years particularly after the introduction of GST.
Given the general nature of the evidence adduced on the topic, I consider that I must necessarily be conservative in allowing for a reduction in the cost of remedial work as at today’s date to allow for increases in the last two years. I think it appropriate to make a deduction of 7.5% per annum for each year, namely a total of 15%.
Cost of remedial work
The agreed remedial work is specified in the passages of the report of Mr Combe set out earlier in these reasons. The plaintiffs called Mr Palmer. In furtherance of this aspect of the plaintiffs’ case it is now necessary to consider his evidence in detail.
Mr Palmer has been in the building industry for over 45 years. He operates his own business as a general builder and he specialises in structural repairs. This includes repairing defective construction work. His duties include the provision of quotations to prospective customers. It is clear from his evidence, and I accept, that Mr Palmer is an experienced builder who is well versed in carrying out remedial work and the costing of same. When providing a quotation he includes a builder’s margin of 20%. GST is then added to the total.
By letter dated 13 October 2006 (Exhibit P6), Mr Palmer provided a quotation to the plaintiffs’ solicitors. In the letter he stated that he had considered Mr Goldfinch’s report and it is implicit that he has prepared his quotation by reference to that report. In his evidence he said that the copy of the Goldfinch report he had seen did not have any underlining in it. The significance of the report being underlined (and side-lined) at a later stage and tendered in that form is that the underlining (and side-lining) disclose the extent of the agreement between the parties on the question of liability. In other words, the defendant only agreed to carry out the remedial work specified in Mr Combe’s report which had either been underlined or side-lined. Because the initial quote from Mr Palmer related to all of the specified work in Mr Goldfinch’s report, his quotation includes the cost of work which is neither pursued by the plaintiffs nor agreed to by the defendant. An example of this is the cost of cutting away part of the eastern wing wall. The trial proceeded on the basis that this was work for which the defendant was not responsible (the wall having been constructed by another builder prior to the defendant’s entry onto the site). Returning to the quotation, Exhibit P6, Mr Palmer referred to the difficulty of access to the site. It was clearly apparent from the view taken at the commencement of the trial that access to the courtyard was restricted because there was no access to it from the outside of the house except for a relatively narrow and steep footpath along the northern wall of the house. Access could also be gained from the rear yard, but again, access to the rear yard was subject to similar restrictions on the southern side of the house. The house itself was situated on a steep block which falls away from the road level in an easterly direction. The double garage is located to the front of the house and the driveway from the road, which is steep, ends at the entrance to the garage. At about the north-western corner of the garage, the path along the northern face of the house commences. In parts, the path slopes steeply and, in any event, gives access only to the stairway located along the eastern retaining wall of the courtyard. No one suggested that this path could be used to gain access to the courtyard for the purposes of carrying out excavation work
In his quotation, Mr Palmer adopted a method of access similar to the one suggested by Mr Goldfinch in his report, namely to cut an aperture in the eastern wall of the double garage of sufficient size to enable a motorised excavator to be lowered onto the courtyard. (It would have to be lowered because the floor of the garage is about 1800mm higher than the floor of the courtyard (T129/34).) The same aperture could be used to remove the spoil from the excavation. In referring to the means of access suggested by Mr Goldfinch, Mr Palmer said:
We have adopted a variation of the proposed method as the angle of ramps is such that it would be hard work pushing barrows up and dangerous coming down loaded on backfill. Our proposal is to cut through the rear wall of the garage, take an excavator through on ramps then remove the ramps and use our bobcat with a bucket removed and a jib fitted to allow full barrows to be lifted up and down to the lower level by three chains hooked to front and handles of the barrow. (Exhibit P6)
He also referred to another suggested means of access which involved cutting through the wall near the fountain in the courtyard. I take this to refer to the wall above the retaining wall, namely the northern wall of the courtyard which is above the courtyard floor level. It is implicit in this suggestion that access would be gained to that point of the northern wall by scaffolding along the northern face of the house. Mr Palmer did not agree with this approach. He said:
However this would require more hand work, make access for an excavator more difficult and generally increase the drama in what was already a very labour-intensive task with high risk back and leg issues pushing up such a steep slope from a standing start. (Exhibit P6)
It was apparent from Mr Palmer’s evidence (T.135 et seq) that, when he considered cutting the northern wall of the courtyard to gain access to it, he was not allowing for scaffolding to be installed along the northern wall of the house. Rather he referred to a drop of some 1800mms to the paving at the foot of the northern retaining wall which in turn required the barrow-load of spoil, once lowered to that level, to be pushed up a narrow path which was very steep. It is not entirely clear that Mr Palmer contemplated lowering the wheelbarrow to the ground level through the proposed gap in the northern wall of the courtyard. It is possible that he contemplated the use of scaffolding at that point, but, whatever view he took, he thought that it was inferior to the method whereby access would be gained to the courtyard through the eastern garage wall.
Mr Palmer also referred to the paving in the driveway and in the courtyard. He said:
In our opinion it is unreasonable to expect that the paving in the courtyard and the drive will be undamaged or easily matched for replacement as a result of the work required and have therefore allowed to replace both courtyard and drive paving. (Exhibit P6)
He estimated that the job would take approximately five weeks. His quote amounted to $48,448 including GST which remained firm for a period of twenty eight days from 13 October 2006. His quotation did not include the $5000 prime cost item referred by Mr Goldfinch in his report.
By letter dated 8 December 2006 (Exhibit P7) Mr Palmer revised his quotation to take account of an arithmetical error that had been made in the earlier quote and to increase the original figure to take account of price rises since 13 October. He stated that his quotation was for $46,847 including GST.
By letter dated 18 October 2006 (Exhibit D10) Mr Palmer advised the plaintiffs’ solicitors that his original quotations included work to the eastern wing wall and that if this work were taken out of his quotation, the price should be reduced by $1000 inclusive of GST. The defendant contended that a much greater deduction should be made to take account of the work to the eastern wing wall.
During the course of his evidence, Mr Palmer was asked about the way in which he approached the costing of the remedial works. He said (T.127/4 et seq) that the excavation work needed to be carried out by machine because of the extent of the excavation, the implication being that the hole that had to be dug was so large that it would be inefficient to dig it manually. He also took into account the amount of the spoil arising from the excavation and, in particular, the fact that that had to be removed from the site. It is implicit in what he said that the removal of spoil from the site was best achieved by taking it through the aperture in the garage wall rather than taking the barrow-loads of spoil along scaffolding constructed along the northern wall of the house and the eastern wall of the courtyard, as suggested by the defendant.
Mr Palmer referred to the nature of the excavation in his evidence (T.127 et seq). He said the depth of the hole would be about 2.7 metres. He thought that it was appropriate to provide for “benching” in the excavation. This involved providing for steps on the side of the excavation which was opposite the retaining wall. He thought it was inappropriate to have that side of the hole as a vertical wall because of the need for shoring which would in turn interfere with the workman digging the lower parts of the trench.
Benching the excavation meant that the volume of spoil would be greater than with a trench which had a shored vertical wall opposite the retaining wall. Mr Goldfinch in his specification said that the wall should be benched and “battered”. The latter term refers to digging the upright part of the step created by the benching so that the upright part of the benching was not vertical but on an angle, the better to avoid the collapse or partial collapse of the upright parts of the wall.
Mr Palmer said that the height of each step would be about 750mms to a metre. Given an excavation of approximately 2.7 metres that would require three steps. Mr Palmer said (T.128) that such a method would have the dual benefit of giving the workman room to work and it would be a safe place to work.
Mr Palmer said (T.130) that it would be necessary to remove the spoil from the site because when the excavation came to be back-filled, Mr Goldfinch provided for a different material.
The spoil was to be loaded into a wheelbarrow which in turn was to be lifted from the courtyard floor to the garage floor by means of an attachment to a bobcat situated on the floor of the garage. Once the wheelbarrow was on the garage floor, it would be wheeled by a workman either to a bin situated outside of the garage doors or onto a truck situated on the driveway. (T.133) The use of a bin would damage the driveway pavers and Mr Palmer allowed for the removal and replacement of those pavers in his quotation. He considered an alternative method of requiring the wheelbarrows of spoil to be pushed up the driveway by the workmen, but he thought that the driveway was so steep that this would be too difficult a task for the workmen. It seems from his evidence (T.134) that the preferred method was to install a waste bin at the foot of the driveway. This would mean that the driveway tiles would be damaged in taking the bin up the driveway but the task for the workmen would be less arduous.
Mr Palmer said (T.133/37) that he considered the use of power wheelbarrows. He was asked by Mr Dal Cin, counsel for the plaintiffs, to give his opinion in relation to an alternative means of access (T.136) whereby scaffolding would be erected along the eastern wall of the courtyard and the northern wall of the house so that wheelbarrows could be taken along the scaffolding to the site for the purposes of having spoil deposited in them and, when full, be taken up the scaffolding to street level for loading onto a truck. Mr Palmer said that motorised wheelbarrows do not “turn the sharpest of corners”. He said the width of the scaffolding would need to be something like two metres and that the cost of the construction, hire and subsequent removal of the scaffolding would be more expensive than cutting a hole through the back wall of the garage. He also commented that such a method would not allow a mechanical excavator to be placed in the courtyard. Excavation by hand would take a lot longer than excavation by using the excavation machine that he had in mind.
Mr Palmer said that he had allowed for the application of waterproofing membrane to various surfaces, to refilling the excavation and to treatment of the kitchen wall of the courtyard level all in accordance with Mr Goldfinch’s specification.
It seems that for a variety of reasons, Mr Palmer was of the view that all of the concrete pavers that formed the floor of the courtyard would need to be removed, not only for the purposes of excavation but also for the purposes of the provision of a sump. As I understand it, Mr Palmer was of the view that the entire floor of concrete pavers would need to be replaced so that there would be a fall towards the sump from all parts of the courtyard. It was common ground that to remove the concrete pavers would probably damage the pavers to the extent that they could not be reused. The damage would be caused because the pavers were attached to a layer of concrete underneath them. I cannot see any part of Mr Goldfinch’s report which requires the complete removal of all of the pavers so that a fall to the sump might be provided for. As I understand his report, the removal of pavers is limited to the area where the excavation needs to take place. I do not accept Mr Palmer’s evidence (T.140/15-27) that the levels of the courtyard floor need to be altered in the manner suggested by him if only because it was not required by Mr Goldfinch.
Mr Palmer said (T.140 et seq) that he allowed for the work specified by Mr Goldfinch in relation to the downstairs bathroom, the paving outside the bathroom and the provision of the sump. He confirmed that he allowed for the work referred to at paragraph 1.3 of Mr Goldfinch’s report involving the eastern wing wall which is not the subject of the plaintiffs’ claim. He allowed for the cost of backfilling and the provision of labour and materials in relation to the application of waterproofing materials and the cost of making good the aperture cut into the garage wall. He allowed for repairs as specified by Mr Goldfinch to the lower parts of the northern retaining wall. He described what repairs were necessary in relation to the bathroom under the kitchen into which there had been an incursion of moisture.
Mr Palmer’s work sheet used by him in the preparation of his costings was admitted into evidence as Exhibit P8.
Much of the balance of Mr Palmer’s evidence deals with the detail of the way in which he arrived at his quotation. Some of this evidence is material to the question of whether Mr Palmer’s estimate of the cost of remedial work is reasonable, but it is not necessary to set out all of it in detail. This is because the task I am presented with is to decide whether Mr Palmer’s evidence that the overall cost is something close to $50,000 is to be preferred to the evidence of Mr Burr who says that the cost is nearer to $15,000.
In my view, such a task requires me first to identify the significant differences between the approaches taken respectively by Mr Palmer and Mr Burr with a view to deciding which (if either) is the preferable approach. I therefore now turn to the evidence of Mr Burr.
According to the documentation forming part of Exhibit P25, Mr Burr holds a building licence which enables him to engage in building work consisting of “domestic additions, alterations and renovations up to and including one storey”. His licence also permits him to be a building supervisor. He is a building supervisor for the defendant’s company, R S Galvin Landscaping Pty Ltd. That company is permitted to engage in “building work associated with landscaping, swimming pool construction, fencing, domestic additions, alterations and renovations up to and including one storey”. Mr Burr has been in the building industry for about twenty years and for the last seven of those years he has been a licensed builder. When he worked as an employee he carried out first and second fix work on buildings, the construction of retaining walls and residential construction. It is clear that there has been a close connection between Mr Burr and Mr Galvin within the building industry over the last twenty years. I agree with the plaintiffs’ submission that the formulation of the quotation dated 2 November 2006 in respect of the cost of remedial work in this case by Mr Burr could hardly be said to be at arm’s length with the defendant. Indeed, it is clear from the evidence that Mr Burr, to some degree, prepared his quotation in consultation with the defendant. The letter of quotation was typed by the defendant’s secretary and Mr Burr agreed that the description of the work to be performed in that quotation was probably done by the defendant. Mr Burr’s quotation was admitted as Exhibit D17.
I accept that I must exercise some caution in relation to Mr Burr’s evidence, given the close relationship that he has had with the defendant over a number of years. However, I emphasise that, although invited to do so by the plaintiffs’ counsel, I do not infer that Mr Burr, in the preparation of his quote and in the giving of evidence in support of that quote during the course of the trial, deliberately attempted to justify opinions expressed by him which he knew to be false. For one thing, such a proposition was never put to him but, more importantly, my impression of him as a witness was for the most part favourable. It seemed to me that when he gave evidence he was endeavouring in a genuine way to support opinions that were actually held by him. I have formed the view that he was a witness of truth but that in some respects his evidence was not reliable because it was vague.
Similarly, but not to the same extent, I formed the view that Mr Palmer was not attempting deliberately to mislead me about what he considered to be a proper cost for the remedial work. But he also, from time to time, gave explanations which I found unconvincing, or he declined to give explanations when asked to do so.
The difference between the two witnesses may be said to be that, on the one hand, Mr Palmer was not motivated to minimise costs because, as was clear from his evidence, he was not anxious to do the job, whereas, on the other hand, Mr Burr was motivated to keep the costs to a minimum because of his long association with the defendant.
For the last seven years Mr Burr has been working as a building contractor and sub-contractor. Most of his sub-contract work has been for the defendant. He estimated (T355/19) that 40% of his work over the last seven years has involved building contracts direct with property owners, and 60% as a sub-contractor. He described the type of work undertaken by him as follows (T355/24-34):
AAnything from major excavation up to footings: steel fixing, tiling, project-managed houses, built a couple of homes for friends with – just project-managed their places and, basically, everything from first fix right up through to a finished completion of a house, landscaping, roofs, any plumbing, electrical work, all that kind of stuff you go through, especially bathrooms which are always a major concern when you are building, its always water catchments who have to actually deal with all the time, waterproofing systems. So, basically, - major retaining walls.
Although he has done some industrial work most of his building work has related to domestic dwellings.
Mr Burr was involved with the work carried out by the defendant on the plaintiff’s house during 1999. He built the staircase leading up to the eastern entrance to the courtyard and he constructed the lightweight wall around the top of the retaining walls of the courtyard.
In November last year the defendant contacted Mr Burr with the request that he provide a quote for rectification work to be carried out at the site, the specifications for which were contained in Mr Goldfinch’s report. Mr Burr was provided with a copy of Mr Goldfinch’s report. It contained underlining (and presumably side-lining) and it was in respect of those specifications that the quote was provided.
Mr Burr’s quote is dated 2 November 2006 (Exhibit D17). Before the quote was signed by him, he made a number of costings in rough form. Those costings totalled $14,090. He gave the rough costings to Mr Galvin’s secretary who in turn typed a list of the costings divided into materials and labour. That list is Exhibit D18. Materials are shown as a total of $6,290 and labour as a total of $7,800 giving a total of $14,090. The total included profit margin and GST.
Some of the work in relation to the preparation of the quotation was done at the defendant’s office. He said that Mr Galvin wanted the written quote in a hurry. Mr Burr said that he was not able to have the document typed up as quickly as Mr Galvin required, so he made an arrangement whereby the actual quote would be typed up at Mr Galvin’s office. He went home, prepared a blank page with his letterhead at the top and forwarded the blank by facsimile transmission to Mr Galvin’s office. Apparently Mr Galvin’s secretary then typed up the body of the quotation. Mr Burr said that he did not prepare the written part of the quote. That was done at Mr Galvin’s office.
Without attempting to be exhaustive, there are four main differences of approach to the rectification work when the evidence of Mr Burr is compared with that of Mr Palmer. Mr Burr’s quote was based on access to the site being gained via a platform constructed of scaffolding starting at the northern wall of the garage and continuing in an easterly direction to the corner of the courtyard, and then in a southerly direction to the eastern entrance to the courtyard. Such access was sufficient if the necessary excavation was to be carried out by workmen using an electric jackhammer and hand tools such as a spade and shovel. The spoil from the excavation was to be loaded onto a powered transporting device. The original quote was prepared on the basis that the transporting device would be a powered wheelbarrow but in evidence, Mr Burr said that he would use another type of powered transporter which was a tracked vehicle and which, he estimated, would hold as much as four times the amount of spoil as an ordinary builder’s wheelbarrow. The mechanised containers of soil would go from the entrance to the courtyard along the scaffolding boardwalk, across the front the garage and up the driveway to a truck parked at street level. The machine would then be guided up a ramp onto the back of the truck and the spoil disposed of on the back of the truck.
Once the excavation became deeper, the spoil would be removed by way of fifteen litre buckets being hoisted out of the hole and emptied onto the mechanised transporter. Using such a method, it would not be necessary to cut an aperture in the eastern wall of the garage, nor to employ a bobcat in the garage; nor would it be necessary to install a mechanised excavator in the courtyard through that aperture.
It can be seen that the method of excavation and access to the site are fundamentally different. Having considered the evidence given by both Mr Palmer and Mr Burr on this point, it seems to me that the method suggested by Mr Burr is preferable. It is clearly less invasive and, I suspect, less expensive, although it is difficult to tell because neither of the witnesses resorted to a level of detail which would make it clear that the one method was either more or less expensive than the other.
I specifically reject Mr Palmer’s assertion that from an occupational, health and safety point of view, it would be inappropriate to have workman going up and down the scaffolding boardwalk with heavy loads of spoil. Whilst I accept that there may be something in the point if wheelbarrows which were unpowered were used, the type of machine referred to by Mr Burr in his evidence clearly does not place a strain on the workman operating the machine. There is no lifting involved; all the workman has to do is to guide the machine.
The next significant difference is the way in which the excavation was to be carried out. Mr Palmer referred to and allowed for a method of excavation which included “benching” and “battering”. Benching involves the excavation of the wall of the trench opposite the retaining wall so that horizontal ledges are dug into the wall at intervals of between 500mm and 1000mm. The excavation required by Mr Goldfinch was approximately 2.7 metres deep; it would require up to three lots of benching.
As to “battering”, the vertical areas between the benches would be dug in such a way that the wall sloped at an obtuse angle. The combination of benching and battering thereby provided a stable wall without the need for shoring. Mr Burr suggested that the wall opposite the retaining wall could be constructed as a vertical wall which was then to be shored. I accept Mr Palmer’s evidence that, given the size of the excavation, the inclusion of shoring between the retaining wall and the dirt wall would be inconvenient for the workmen working within the excavation and that the better and safer method is to provide for benching and battering.
The construction of the excavation in such a way would be clearly more expensive than that provided for by Mr Burr, because the excavation would be considerably larger and thereby more spoil would have to be removed. Again it is not possible to be specific as to the difference in costs, but these findings need to be taken into account in a general way when assessing what the reasonable cost of the remedial work specified by Mr Goldfinch is.
The next difference between the witnesses relates to back-filling. Mr Goldfinch’s specification requires that once the excavation was back-filled, it had to be back-filled with material other than the spoil which had been taken out of the excavation. Mr Burr said that there was a possibility (not a certainty nor even a probability) that the original spoil removed could be used to back-fill the excavation. Neither of the witnesses elaborated on why one method of back-fill was preferable to the other. On balance I think it appropriate to accept the method specified by Mr Goldfinch, if only because no evidence was called to suggest that Mr Goldfinch was wrong in imposing such a requirement. Again it is not possible, given the general nature of the evidence given by Mr Palmer and Mr Burr respectively, to differentiate in any precise way between the costs of this aspect of the job allowed for by Mr Burr as compared with the costs allowed for by Mr Palmer.
Mr Palmer said that up to five men would be required on site to carry out the task at given times. It was not his evidence that five workmen would need to be available at all times, but no specific evidence was given by him as to the number of men required for any given period during the course of the remedial building work. Mr Burr’s evidence was that two to three workmen at the most would be required on site at any given time. In addition, both Mr Burr and Mr Palmer differed as to the duration of the remedial work. Mr Palmer said that the job would take about five weeks and Mr Burr said that it would take about two weeks. Having considered the evidence of each of them relating to the nature of the remedial work that should be done, and taking into account my findings as to the differences in approach relating to the access to the site, excavation and back-filling, I think that Mr Burr’s estimate is nearer to the mark and that I should allow a period of two weeks for the work to be carried out.
The next difference between the approaches taken by the witnesses relates to the paving in the courtyard and paving along the driveway. Mr Palmer was of the view that all of the pavers in the courtyard had to be raised because the excavation would require the lifting of some of the pavers and the setting of the courtyard floor levels to drain towards the sump in the middle of the courtyard would require the remainder of the paving blocks to be removed. He also said that the pavers in the driveway would need to be taken up and replaced because they would be damaged in the course of taking the spoil from the excavation site and up the driveway.
Mr Burr’s quote was based on the assumption that only those pavers required to be removed for excavation purposes would need to be replaced. I mention that it was common ground that if any of the courtyard pavers did have to be removed, they would probably be broken in the process because they were attached to the underlying slab of concrete. Mr Burr’s quote was also based on the assumption that replacement pavers could be obtained which matched the old pavers particularly if the old pavers, after the completion of the remedial work, were cleaned. I think that this is a reasonable assumption. For the reasons given earlier, I reject Mr Palmer’s contention that all of the courtyard pavers would need to be removed. Such a claim was not pursued by the plaintiff. In other words the defendant had not agreed, on the question of liability, to do remedial work which required the removal and replacement of all of the courtyard pavers.
In addition, I reject Mr Palmer’s contention that it would be necessary to remove and later replace all of the pavers on the driveway of the premises. In my view, the method of removal of spoil advocated by Mr Burr, in particular the use of motorised transporters, would not damage the driveway pavers, particularly if they were protected by a suitable covering. Costs allowed for removal and replacement of pavers in the courtyard area by Mr Palmer amount respectively to $1,500 and $2,500. Insofar as the driveway pavers are concerned this involves expenditure of another $1,200 and $3,000 respectively. This would be a cost saving of about $6,000.
I accept the submission of Mr Black, counsel for the defendant, that I also need to take into account deductions on account of work provided for by Mr Palmer which exceeded Mr Goldfinch’s specification. This included the area to be waterproofed on the inside of the retaining walls and the removal of part of the eastern wing wall. I accept in general terms the thrust of the submission contained at paragraph 18 of Mr Black’s written submission whereby he contends for deductions involving waterproofing, courtyard and driveway pavers, access through the garage and for partial removal of the eastern wing wall. I do not think that account may be taken of these matters with the same arithmetical precision contended for by Mr Black but his figures are, I consider, a guide to the sort of deduction that might be made from Mr Palmer’s quotation.
The main complaint that may be made about Mr Burr’s quotation and the evidence that he gave in support of it is that in many respects, the detail of the specifications set out by Mr Goldfinch in his report are not specifically dealt with. When questioned about some of these during the course of cross-examination, Mr Burr’s response was that the detail is included in the broad items. In my opinion, this is not a satisfactory way of providing an accurate estimate as to what reasonable costs of specified remedial work are. I have in addition referred to the fact that there has been a close working relationship between Mr Burr and Mr Galvin over some twenty years and that I must therefore exercise some caution in relation to the estimate provided by Mr Burr.
Doing the best I can with the evidence available to me, and taking into account the matters referred to above, I have come to the view that a fair estimate of the cost of the remedial work as at today’s prices amounts to $20,000. Making an allowance for the increase in building costs over the last two years at a rate of approximately 7.5% per annum, the cost of carrying out the remedial work at prices which applied two years ago amounts to $17,000 approximately including GST.
The final aspect of the assessment of damages is the claim for relocation expenses. It was the plaintiffs’ case that during the period of the remedial work, it would not be appropriate to remain in occupation of the dwelling because of safety and health concerns relating to the plaintiffs’ young children. In my opinion, such expenses may be allowed where the use and occupation of the premises is so materially affected by the building works that the building could not be effectively used as a dwelling house and (in this case) there would be an undue risk to health and safety of the plaintiffs’ children.
Whilst I accept that the plaintiffs have concerns about the health and safety of their children, I do not accept that the nature of the work to be carried out is such that it will be detrimental either to the health or safety of the plaintiffs’ children. The courtyard area is an area which can be sealed off from children in a sense that the doors at the southern end of the courtyard may be locked and the entrance to the courtyard along the eastern wall may be secured during the course of the works when the workmen are not in attendance. I do not consider that the proposed scaffolding along the northern wall of the house presents an undue danger to young children, even though they are physically active. In addition, I do not consider that the nature of the work to be carried out may be detrimental to the health of any of the children even if they or some of them have respiratory problems. For these reasons, I decline to award damages for relocation expenses.
I mention briefly that I have considered the defendant’s submissions relating to the principle of “betterment” set out at paragraphs 58 and 59 of Mr Black’s written address. I have not applied the principle referred to because I consider it to be inapplicable principally because the damages awarded do not include an amount for the extra remedial work in respect of which the defendant is not liable. It is fortuitous that the plaintiffs will have access to the eastern wing wall, but that does not give rise to an allowance/deduction for betterment.
There will be judgment for the plaintiffs in the sum of $17,000. I will hear counsel as to interest and costs.