Queensland Building Services Authority v Metal Line Brisbane Pty Ltd

[2010] QCAT 164

CITATION: Queensland Building Services Authority v Metal Line Brisbane Pty Ltd [2010] QCAT 164

PARTIES:	Queensland Building Services Authority
v
Metal Line Brisbane Pty Ltd

APPLICATION NUMBER:   QD001-07     

MATTER TYPE: Occupational regulation matters

HEARING DATE:     Decision on the papers

HEARD AT:  Brisbane

DECISION OF: Clare Endicott

DELIVERED ON: 21 April 2010

DELIVERED AT:      Brisbane

ORDERS MADE: Metal Line Brisbane Pty Ltd is ordered to pay to Queensland Building Services Authority the sum of $1,350 by way of penalty by 4.00pm on 17 May 2010

CATCHWORDS :  Penalty – breach of statutory requirement – section 91(3)(b) of the Queensland Building Services Authority Act 1991

APPEARANCES and REPRESENTATION (if any):

The hearing took place on the papers in the absence of the parties.

REASONS FOR DECISION

1. Metal Line Brisbane Pty Ltd (MLB) held a licence issued by the Queensland Building Services Authority (the QBSA) in December 2002. 
2. In December 2004 a complaint was lodged with the QBSA by Marjan Milos alleging defective building work carried out by MLB at his property.
3. After investigating the complaint, the QBSA determined that MLB had breached sections of the Domestic Building Contracts Act 2000 and on 22 June 2005 the QBSA issued infringement notices against MLB.
4. On 1 December 2005 MLB elected to proceed by way of court hearing on the infringement notices.
5. The QBSA commenced proceedings in January 2007 in the Commercial and Consumer Tribunal against MLB seeking orders that proper grounds exist for disciplinary action for breaching sections 27(1), 40(1) and 64(1) of the Domestic Building Contracts Act 2000.   
6. From 1 December 2009 the Queensland Civil and Administrative Tribunal (the Tribunal) has replaced the Commercial and Consumer Tribunal on the commencement of the Queensland Civil and Administrative Tribunal Act 2009.
7. Under section 256 of the Act, a pending proceeding (being a proceeding commenced in one of the Tribunals replaced by the 2009 Act but not heard by the replaced Tribunal prior to 1 December 2009) is taken to be a proceeding before the Queensland Civil and Administrative Tribunal.  Under section 271 of the Act, the Tribunal has the functions of the former Tribunal and can make a decision that the former Tribunal could have made in relation to the proceeding.
8. The former Tribunal had the power under section 107(2) of the now repealed Commercial and Consumer Tribunal Act 2003 to impose a monetary penalty in disciplinary proceedings commenced by the QBSA. Since its commencement on 1 December 2009, the Civil and Administrative Tribunal has been given the same power to impose a monetary penalty in these types of disciplinary proceedings by section 91(3) of the Queensland Building Services Authority Act 1991.  
9. On 19 February 2010 an order was made by consent that proper grounds exist for disciplinary action against MLB for contravention of sections 27(1), 40(1) and 64(1) of the Domestic Building Contracts Act 2000. The Tribunal scheduled a hearing to be conducted on the papers to consider what penalty to impose on MLB.

Evidence

10. The QBSA relied on evidence in the following documents:

application for a disciplinary proceeding filed in the Commercial and Consumer Tribunal on 4 January 2007

affidavit of Coral Maree Kuhl sworn on 3 January 2007

affidavit of Gina Do sworn on 3 January 2007

application for consent order filed on 18 January 2010.

11. Vincenzo Squillace, a director of MLB, provided the Commercial and Consumer Tribunal on 23 February 2007 with a written statement which set out an explanation for its actions.    

Submissions on penalty

12. In its written submissions, the QBSA submitted that there is sufficient evidence that MLB contravened the stated provisions of the Domestic Building Contracts Act 2000 (the Act).  The penalty should have a deterrent effect on MLR and on others who might contemplate committing similar breaches of the Act.  The penalty must assess the gravity of MLB’s conduct against the objects of the Act, including protection of consumers.
13. The Tribunal was urged to consider whether there has been a satisfactory explanation for the breach, whether a breach is likely to re-occur, whether an admission had been made by MLB at the earliest opportunity, the need to maintain consistency of penalties and the desirability of a penalty having a strong deterrent effect.
14. The QBSA submitted that there were some mitigating factors that the Tribunal could take into account being the admission made by MLB, the full co-operation manifested by MLB and the lack of any record that MLB had previously breached the requirements of the Act. 
15. The QBSA submitted that there were no decided cases to guide the Tribunal’s determination of penalty for breaches of sections 27(1), 40(1) and 64(1) of the Act. The QBSA submitted that the appropriate range of penalty would be $300 to $330 each for breach of sections 27(1) and 40(1) and $1,500 to $1,650 for breach of section 64(1) of the Act.
16. MLB did not provide any submissions on penalty.

Findings on the evidence

17.MLB held a licence from the QBSA at times relevant to this proceeding and in particular in December 2002.

18.MLB provided a quote to Marjan Milos to carry out roofing work on a property at 33 Perevale Street, Hillcrest on 15 December 2002 for $6,050. 

19.MLB requested a deposit of 50% of the quoted price but was paid a deposit of $1,000 on 16 December 2002 by Marjan Milos.

20.MLB provided Marjan Milos with a customer order acceptance form and a QBSA contract for small building projects on 16 December 2002.

21.The contractual documents did not indicate whether the building owner is a resident owner, the start date of the work or the date when the work was to be finished. 

22.MLB did not provide any contract information statement to Marjan Milos advising him of his right to withdraw from the contract.

23. MLB has not previously been the subject of disciplinary proceedings for breach of the sections in the Domestic Building Contracts Act 2000 specified in the proceeding. 

Conclusion

24. The contract entered into between MLB and Marjan Milos for roofing work at 33 Perevale Street, Hillcrest on 15 December 2002 was a regulated contract for the purposes of the Domestic Building Contracts Act 2000.
25. It was determined by the Tribunal on 19 February 2010 that proper grounds exist for disciplinary action against MLB for contravention of section 27(1) of the Domestic Building Contracts Act 2000 in that MLB failed to ensure that its contract with Marjan Milos complied with the formal requirements for a regulated contract, for contravention of section 40(1) of that Act in that MLB failed to give the building owner a copy of the appropriate contract information statement and for contravention of section 64(1) of that Act in that MLB received a deposit under the contract in excess of the limit imposed by statute.
26. The purpose of disciplinary proceedings is to protect the public rather than to punish wrongdoing. This purpose can be achieved by maintaining the integrity of a statutory regulation scheme in the building industry which promotes confidence that building contractors are being required to comply with statutory requirements for the protection of the public and consumers in the building industry. 
27. A contravention by a licensed contractor of statutory requirements tends to adversely impact on the integrity of an occupational regulatory scheme and to erode public confidence in the regulatory scheme unless a penalty is imposed proportionate to the contravention.  
28. The Tribunal considers that a penalty should be imposed to act as a deterrent against contravention by this licensee and by all other licensees and to signal support for the integrity of the regulatory scheme.  At the same time the penalty should reflect the full co-operation given by MLB to the QBSA’s investigation and the lack of previous contraventions of the Act.     
29. The Tribunal has taken into account that the maximum penalty allowed for breaches of sections 27(1) and 40(1) of the Act is $1,200 for each breach and $7,500 for a breach of section 64. The infringement notices withdrawn by the QBSA before the start of these proceedings imposed penalties of $150 for each of the breaches of sections 27(1) and 40(1) and $750 for breach of section 64(1).
30. MLB in the statement of Mr Squillace asserted that in December 2002 it had acted on the understanding that Marjan Milos was the builder on the work site and not the resident owner.  While MLB made an admission in 2010 that it had contravened the Act, the Tribunal in light of the statement of Mr Squillace considers that the contravention was inadvertent and arose from erroneous information held by MLB about the proper status of Marjan Milos at the relevant time. 
31. The admission made by MLB has avoided the need for a hearing of the substantive proceeding and is a factor taken into account when setting the penalty. The Tribunal imposes a penalty of $250 for each of the breaches of section s 27(1) and 40(1) and $850 for the breach of section 64(1) on MLB. Such a penalty is not inconsistent with the penalties levied in the withdrawn infringement notices but recognises that a higher amount of penalty will be incurred when proceedings have to be commenced to enforce statutory requirements of licences.
32. The Tribunal orders MLB to pay to the QBSA the sum of $1,350 by way of penalty by 4.00pm on 17 May 2010.
33. In its submissions, the QBSA does not seek costs from MLB. While the Tribunal has the power to award costs under section 102 of the Queensland Civil and Administrative Tribunal Act 2009, the Tribunal notes that in this case the QBSA was not represented by lawyers.  The Tribunal will not order costs to the QBSA in this case.