Queensland Building and Construction Commission v Body Corporate for Brighton on Broadwater Sundale N1 CTS 48640 & anor - [2023] QCAT 506

QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL

CITATION:

Queensland Building and Construction Commission v Body Corporate for Brighton on Broadwater Sundale N1 CTS 48640 & anor [2023] QCAT 506

PARTIES:

QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION

(applicant)

v

BODY CORPORATE FOR BRIGHTON ON BROADWATER SUNDALE N1 CTS 48640

(first respondent)

KARIMBLA CONSTRUCTIONS SERVICES (QLD) PTY LTD

(second respondent)

APPLICATION NO/S:

GAR403-23

MATTER TYPE:

General administrative review matters

DELIVERED ON:

18 December 2023

HEARING DATE:

14 December 2023

HEARD AT:

Brisbane

DECISION OF:

Senior Member Traves

ORDERS:

1. The application for referral of a matter seeking an extension of time pursuant to s 72A(4) of the Queensland Building and Construction Commission Act 1991 (Qld) is allowed.

The time to issue a direction to rectify is extended to 4:00pm on 29 January 2024.2.

CATCHWORDS:

GENERAL ADMINISTRATIVE REVIEW MATTERS – where direction to rectify defective work carried out by second respondent given within time – where second respondent applied for an extension of time to rectify the work – where extension applied for after time for rectification expired – where the time to issue a further direction to rectify has expired – where the Queensland Building and Construction Commission has applied for referral of matter to the tribunal seeking an extension of time to issue a direction to rectify pursuant to s 72A(4) of the Queensland Building and Construction Commission Act 1991 (Qld) – where applicant and second respondent consent to the order sought – whether order granting an extension of time to issue a direction to rectify should be granted.

Queensland Building and Construction Commission Act 1991 (Qld), s 3, s 72, s 72A, s 72B

Queensland Building Services Authority v McDonnell [1994] QBT 1.

APPEARANCES & REPRESENTATION:

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld)

REASONS FOR DECISION

On 13 June 2023 the Queensland Building and Construction Commission filed a Referral of a Matter in the Tribunal seeking an order for an extension of time for the Commission to issue a direction to rectify to the second respondent, Karimbla Constructions Services (Qld) Pty Ltd (Karimbla) pursuant to s 72A(4) of the Queensland Building and Construction Commission Act 1991 (Qld) (QBCC Act).
Karimbla and the first respondent, the Body Corporate for Brighton on Broadwater Sundale N1 CTS 48640 (the body corporate) consent to the Commission’s request for an order to extend time to give a direction to rectify. The matter nonetheless requires the exercise of the Tribunal’s discretion.
Background
On or around 4 October 2016 Karimbla completed the construction of a 55 storey high-rise apartment building at Broadbeach. The body corporate, together with two other bodies corporate, subsequently became the owner of the property.
On 28 February 2022 the body corporate filed a complaint in relation to alleged defective work carried out by Karimbla at the property, including relating to water ingress into the apartment building via the balcony doors of specified residential units.
The complaint comprised 85 items in respect of various units.
On 12 July 2022 Mr Jordan Collins and Mr Jed Sinclair, each senior building inspectors with the Commission, undertook an inspection of the complaint items.
On 10 November 2022 Karimbla provided further information in relation to the complaint items, namely window shop drawings and building design drawings.
On 21 December 2022 Mr Collins and an inspector external to the Commission, Mr Craig Brennan of CMB Management Services Pty Ltd, conducted a second inspection and, on 29 January 2023, Mr Brennan provided a report to the Commission.
On 13 February 2023 Mr Collins prepared an inspection report based on his inspections and Mr Brennan’s report.
On 27 February 2023 the Commission issued a Direction to Rectify[1] (DTR) to Karimbla in relation to the design and installation of balcony sliding door assemblies. The defect was required to be rectified by 3 April 2023.
[1]Direction 0110486.
On 4 April at approximately 4:30pm the solicitors for Karimbla wrote to the Commission seeking a four (4) month extension of time to comply with the DTR in circumstances where:
(a)Karimbla had undertaken further investigations to assess a suitable scope of work;
(b)it had been concluded that the installation of the balcony sliding doors was not in accordance with the original specification;
(c)Karimbla had engaged a contractor to reverse the installation to the original specification, which was expected to take time; and
(d)further, Karimbla was proposing to remedy a test unit first. If the proposed scope of work was successful, the remaining units would be remedied pursuant to that scope.
On 4 April 2023, the statutory timeframe to give a direction to rectify (being 6 years and 6 months from the date the work was completed) expired.
On 14 April 2023 the Commission wrote to the parties and advised that, as the extension application had not been made before the end of the DTR compliance period, as required by s 72B of the QBCC Act, the Commission had no power to grant the extension. Nor did it have the power to withdraw the DTR and issue a further DTR with a new compliance period. However, the Commission advised that, pursuant to s 72A(4) of the QBCC Act the Tribunal, on application by the Commission, may grant an extension of time to give a direction, if satisfied there is in the circumstances of a particular case sufficient reason for extending the time for giving the direction.
On 14 April 2023 Karimbla consented to the Commission making the s72A(4) extension application and, on 15 April 2023, the body corporate also consented.
Statutory framework
The objects of the QBCC Act are set out in s 3. Section 3 provides:
3 OBJECTS OF ACT
The objects of this Act are—
(a) to regulate the building industry—
(i) to ensure the maintenance of proper standards in the industry; and
(ii) to achieve a reasonable balance between the interests of building contractors and consumers; and
(b) to provide remedies for defective building work; and
(c) to provide support, education and advice for those who undertake building work and consumers; and
(d) to regulate domestic building contracts to achieve a reasonable balance between the interests of building contractors and building owners; and
(e) to regulate building products to ensure—
(i) the safety of consumers and the public generally; and
(ii) persons involved in the production, supply or installation of building products are held responsible for the safety of the products and their use; and
(f) to provide for the proper, efficient and effective management of the commission in the performance of its functions.
The power to issue a direction to rectify is outlined in s 72 of the QBCC Act.
72 POWER TO REQUIRE RECTIFICATION OF BUILDING WORK AND REMEDIATION OF CONSEQUENTIAL DAMAGE
(1) This section applies if the commission is of the opinion that—
(a) building work is defective or incomplete; or
(b) consequential damage has been caused by, or as a consequence of, carrying out building work.
(2) The commission may direct the person who carried out the building work to do the following within the period stated in the direction—
(a) for building work that is defective or incomplete—rectify the building work;
(b) for consequential damage—remedy the damage.
(2AA) A regulation may prescribe a period within which the commission must make the direction.
(2A) If a period is prescribed under subsection (2AA), the commission must make the direction during the prescribed period.
(3) In deciding whether to give the direction, the commission may take into consideration all the circumstances it considers are reasonably relevant and, in particular, is not limited to a consideration of the terms of the contract for carrying out the building work (including the terms of any warranties included in the contract).
(4) The period stated in the direction must be the period prescribed by regulation unless the commission is satisfied that, if the direction is not required to be complied with within a shorter period—
(a) a substantial loss will be incurred by, or a significant hazard will be caused to the health or safety of, a person because of the defective or incomplete building work or consequential damage; or
(b) the defective or incomplete building work, or consequential damage, will cause a significant hazard to public safety or the environment generally.
(5) The commission is not required to give the direction if the commission is satisfied that, in the circumstances, it would be unfair to the person to give the direction.
Example for subsection (5)—
The commission might decide not to give a direction for the rectification of building work because an owner refuses to allow a building contractor to return to the owner’s home or because an owner’s failure to properly maintain a home has exacerbated the extent of defective building work carried out on the home.
(6) …
(7) …
(8) …
Section 72A(4) provides:
(4) A direction to rectify or remedy cannot be given more than 6 years and 6 months after the building work to which the direction relates was completed or left in an incomplete state unless the tribunal is satisfied, on application by the commission, that there is in the circumstances of a particular case sufficient reason for extending the time for giving the direction and extends the time accordingly.
Section 72B provides:
72B EXTENDING TIME TO RECTIFY OR REMEDY
(1) A person given a direction to rectify or remedy may apply to the commission for an extension of the period for compliance with the direction.
(2) The application must—
(a) be made before the end of the period stated in the direction; and
(b) state the reasons the extension is needed.
(3) The commission must decide whether or not to grant the extension, and inform the applicant of the decision, within 10 business days after receiving the application.
(4) The commission may grant the extension only if satisfied it is likely to be impracticable for the applicant to comply with the direction within the period stated in the direction.
(5) Also, the commission must grant the extension if satisfied the person affected by the building work the subject of the direction has agreed to the extension being applied for.
(6) If the commission grants the extension, the commission must give the applicant a written notice stating the period within which the applicant must rectify the work or remedy the damage.
(7) If the commission refuses to grant the extension, the commission must give the applicant written notice of the refusal.
(8) If the commission fails to comply with subsection (3), the commission is taken to have decided to refuse the application.
(9) The direction to rectify or remedy is stayed while the commission considers the application.
Consideration
A direction to rectify cannot be given more than 6 years and 6 months after the building work to which the direction would relate was completed.[2] However, the Tribunal may extend that time if the Commission has made an application for it to do so and the Tribunal is satisfied there is sufficient reason to grant an extension.[3]
[2]QBCC Act, s 72A(4).
[3]QBCC Act, s 72A(4).
The Commission bears the onus of demonstrating, on the balance of probabilities, there is sufficient reason to extend time.[4]
[4]Queensland Building Services Authority v JP Constructions Pty Ltd (unreported D012-1993, 11 May 1993 cited in Queensland Building Services Authority v D’Rozario & anor [2003] QBT 12.
The meaning of “sufficient reason” was considered by Member Burke in Queensland Building Services Authority v McDonnell.[5] There, it was observed:
I am satisfied that there must be grounds amounting to a special reason which take the matter out of the ordinary. The "sufficient reason" relevant to the power in section 72(5) of the Act must be based on an elastic test suitable for application across a range of situations, from an oversight by the Authority of one day to neglect over a prolonged period. I am of the opinion that the expression "sufficient reason" describes "a flexible discretionary power", but one requiring a case to be made upon grounds sufficient to justify a departure, in the particular circumstances, from the ordinary rule prescribing a period in which a particular step is to be taken [Jess v Scott [1986] FCA 365; (1986) 12 FCR 187 at 195].
The cases outlining the general principles applied by the Courts, for example when one party applies for an extension of time in which to institute an appeal or join a party, are only of assistance to the extent that they envisage some flexibility in the exercise of the discretion. I am of the opinion, however, that such flexibility in the exercise of the discretion must be tailored to encapsulate the intent and framework of the Act.
[5][1994] QBT 1.
The following considerations may be relevant to the exercise of the discretion:
(a)when the allegedly defective or incomplete work was carried out;
(b)whether there was any delay by the Commission in making the application for an extension of time;
(c)whether, putting aside the expiry of the limitation period, there is evidence to support the issue of a direction under s 72(1); and
(d)whether the exercise of a discretion will promote the obtainment of the specified objects of the QBCC Act as set out in s 3.[6]
[6]Ibid at 6-7.
The allegedly defective building work was completed on 4 October 2016. The time within which a direction to rectify could be given, absent an extension, was 4 April 2023.
In this case, the Commission issued a direction to rectify within time, namely on 27 February 2023. The Direction was required to be complied with by 3 April 2023. The contractor was working towards fulfilling its obligations under the Direction but required more time to do so. A contractor may apply to the Commission for an extension of the compliance period provided they do so before it expires. In this case, a 4 month extension of the period of compliance was sought on 4 April at 4:33pm, one day after the expiration of the period of compliance.
On 13 June 2023 the Commission applied for an extension of time pursuant to s 72A(4) to issue a further direction to rectify. This is a delay of approximately two months from the expiration of the original direction to rectify. I note that the parties had each given their consent to the extension application on or before 15 April 2023.
Although there was an approximately 2 month delay in bringing the application, I do not consider this to be significant in the context of the complexity of the legal and factual issues involved.
It is not disputed that there is evidence to support the issue of a further direction. The original direction was issued and was not complied with; the contractor was prepared to comply with the direction; and the contractor and the body corporate have agreed that a further direction should be issued. I also note that Karimbla’s corporate counsel wrote to the Commission on 4 April 2023 in the following terms:
Following the investigations, it was concluded that the installation was not in accordance with the original specification. Therefore, Karimbla has engaged the contractor to reverse the installation to original, which could take some time.
Further, in my view, it is consistent with the objects of the QBCC Act to enable rectification work to proceed by granting an extension pursuant to s 72A(4) to permit that work to proceed. One of the objects of the QBCC Act is to provide remedies for defective building work (s 3(b)) which will clearly be achieved by granting the extension. Further, such an extension is consistent in this case, with the object of achieving a ‘reasonable balance between the interests of building contractors and consumer’,[7] particularly in circumstances where they agree to the extension.
[7]QBCC Act, s 3(a)(ii).
There is no time frame sought for the extension. I will allow an extension of 28 days for the Commission to issue a further direction. Whether the period of compliance in respect of that direction requires extension is another matter.
Accordingly, I make the following orders:
1. The application for referral of a matter seeking an extension of time pursuant to s 72A(4) of the Queensland Building and Construction Commission Act 1991 (Qld) is allowed.
2. The time to issue a direction to rectify is extended to 4:00pm on 29 January 2024.