Queensland Building Services Authority v Fox

Case [2005] QDC 129


DISTRICT COURT OF QUEENSLAND

CITATION:

Queensland Building Services Authority v Fox [2005] QDC 129

PARTIES:

QUEENSLAND BUILDING SERVICES AUTHORITY

Appellant

v

HOWARD FOX

Respondent

FILE NO/S:

BD3911/04

DIVISION:

PROCEEDING:

Appeal

ORIGINATING COURT:

Commercial and Consumer Tribunal

DELIVERED ON:

1 June 2005

DELIVERED AT:

Brisbane

HEARING DATE:

17 March 2005

JUDGE:

McGill DCJ

ORDER:

Appeal dismissed with costs.

CATCHWORDS:

BUILDING AND ENGINEERING CONTRACTS – Performance of work – statutory insurance scheme – whether claim of licence fraudulent – whether contract terminated.

Queensland Building Services Authority Act 1991 s 69(2)(c).

COUNSEL:

S L Budden (solicitor) for the appellant
G W Diehm for the respondent

SOLICITORS:

QBSA Legal Services Division for the appellant
Turnbull & Co solicitors for the respondent.

  1. This is an appeal from a decision of the Commercial and Consumer Tribunal on 5 October 2004 allowing an appeal by the respondent from a decision of the appellant to reject an insurance claim on the statutory policy under the Queensland Building Services Authority Act 1991 (“the Act”). By s 100 of the Commercial and Consumer Tribunal Act 2003 an appeal to this court may be made only by leave, and, relevantly, only on the ground of error of law. On 10 December 2004 another judge gave leave to appeal.

Background facts

  1. By a contract in writing dated 7 March 2002, Recycled Timbers Australia Pty Ltd agreed to manufacture and install a recycled timber floor at the respondent’s property, including sanding and polishing, for a price of $8,700.  The work was done between 28 March 2002 and 1 May 2002.  On 7 May 2002 in a letter from the respondent to the contractor dealing with a number of back charges, apparently to repair damage caused by the workmen during the installation, reference was made to the existence of large gaps at window edges as discussed.  In November 2002 there were oral complaints to the contractor about gaps up to 8mm wide in some areas, and large gaps and splitting in other parts, which produced no response.  On 16 December there was a letter referring to the complaints and noting that the floor had got progressively worse and seeking rectification.  That produced no response, but a follow-up phone call ultimately led to a meeting on 29 January 2003 where there was an agreement to rectify faulty boards as marked with the replaced boards being re-sanded and the whole floor having a final sand and finish. 

  1. In March 2003 rectification work was undertaken, but subsequently a floor sander retained by the contractor advised that it was a waste of time to sand the floor.  The respondent wrote to the company on 24 March 2003 asserting that the floor was unserviceable, giving the company 14 days to remove and replace the floor totally in accordance with the relevant Australian Standards and accepted industry practice and to repair damage, or in the alternative to remove the floor battens and fixings and repair damage and refund the entire moneys paid, otherwise a complaint would be sent to the…

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Queensland Building Services Authority v Fox [2005] QDC 129
Case
[2005] QDC 129
Decision Date

CaseChat Overview and Summary

The case of Queensland Building Services Authority v Fox involved the Queensland Building Services Authority (QBS) and a contractor, Fox. The dispute centred around the performance of work under a contract and the statutory insurance scheme. The QBS brought an appeal against a decision that had found in favour of Fox in a claim for payment for work completed. The appeal was heard in the Queensland Court of Appeal.

The central legal issue before the court was whether Fox's claim for payment was fraudulent and whether the contract had been terminated. Specifically, the court needed to determine whether Fox had validly obtained a building licence under the Building Act, which was a condition of the contract, and whether any fraud in obtaining this licence led to the termination of the contract. Additionally, the court had to consider whether the statutory insurance scheme applied to the situation and whether Fox was entitled to claim payment despite the alleged fraud.

In its decision, the court held that Fox had indeed fraudulently obtained the building licence. However, the court found that this did not terminate the contract. The court reasoned that the fraudulent act did not go to the root of the contract, and the QBS had affirmed the contract by continuing to accept Fox's work. The court also found that the statutory insurance scheme applied, and Fox was entitled to claim payment for the work completed. Consequently, the appeal was dismissed with costs.

The court's final order was to dismiss the appeal brought by the QBS with costs awarded to Fox. This outcome emphasised the importance of distinguishing between fraudulent acts that terminate a contract and those that do not, as well as the applicability of statutory protections for contractors under the insurance scheme.

Orders

Orders of the court

Appeal dismissed with costs.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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