Queensland Building Services Authority v Fenwick

The Queensland Building Services Authority sought a review of an adjudicator's decision that ruled in favour of Mr. Fenwick, the builder, regarding the reasonable cost to complete a building project. The primary dispute centred on the interpretation of Clauses 1.4 and 1.6 of the Queensland Building Services Authority Statutory Insurance Policy Conditions, 7th Edition, which relate to the timing and basis for assessing the reasonable cost to complete the project. The dispute was ultimately heard by the Queensland Court of Appeal.

The central legal issues before the court were the correct interpretation of the relevant clauses and the timing of the assessment of the reasonable cost to complete the building project. Specifically, the court had to determine whether the reasonable cost should be assessed at the date of the adjudicator's decision or at the date of the contract termination. The court also needed to decide whether the $11,000 prepayment constituted part of the reasonable cost to complete.

The Court of Appeal held that the reasonable cost to complete should be assessed as at the date of the adjudicator's decision. This interpretation was consistent with the policy's objective to provide a fair and timely resolution of disputes. The court found that the reference to the "date of the contract termination" in Clause 1.4 was not determinative of the assessment date but rather provided context for understanding the circumstances of the dispute. Regarding the $11,000 prepayment, the court ruled that it should not be included in the reasonable cost to complete as it was a separate payment not related to the work to be done. However, the court granted leave to appeal on this limited issue, allowing the parties to seek further clarification on this point.