Rainbow v Turkovic

Case [2021] QCAT 441

QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL


CITATION:

Rainbow v Turkovic & anor [2021] QCAT 441

PARTIES:

BLAIR RAINBOW

(applicant)

v

ED TURKOVIC
MICHELLE GROGAN

(respondents)

APPLICATION NO/S:

BDL271-19

MATTER TYPE:

Building matters

DELIVERED ON:

20 December 2021

HEARING DATE:

1 February 2021

2 February 2021

FURTHER SUBMISSIONS:

26 February 2021; 12 March 2021; 26 March 2021; 9 April 2021; 16 April 2021

HEARD AT:

Brisbane

DECISION OF:

Member Traves

ORDERS:

1.       On the application for a domestic building dispute filed by Blair Rainbow, Ed Turkovic and Michelle Grogan pay to Blair Rainbow the sum of $65, 019.11.

2.       On the cross-application filed by Ed Turkovic and Michelle Grogan:

(i)     Blair Rainbow pay to Ed Turkovic and Michelle Grogan the sum of $30, 346.27, by way of damages for negligence; and

(ii)   Blair Rainbow pay to Ed Turkovic and Michelle Grogan the sum of $6, 501.55, by way of restitution for money paid under a mistake of fact.

3.       In the premises of order 1 and 2 hereof, the net sum payable by Ed Turkovic and Michelle Grogan to Blair Rainbow is the sum of $28, 171.29. This sum must be paid, by:

4:00pm on 28 January 2022.

4.       The parties must file and serve any submissions seeking costs by 4:00pm on 11 February 2022.

5.       The parties must file and serve any submissions as to costs in reply by 4:00pm on 25 February 2022.

6.       Unless otherwise ordered, any application for costs will be determined by the Tribunal on the papers on the basis of the parties’ written submissions and without an oral hearing, not before 4:00pm on 25 February 2022.

CATCHWORDS:

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – RECOVERY ON QUANTUM MERUIT – IN GENERAL – where Owners engaged builder to complete renovations to their home on a cost plus basis – where no contract signed – where non-compliance with s 13(2) of Schedule 1B of the Queensland Building and Construction Commission Act 1991 (Qld) whether contract of no effect – whether builder entitled to recover on quantum meruit – whether evidence of fair and reasonable value of work – whether evidence of market price of labour and materials necessary

BUILDING DISPUTE - NEGLIGENCE – whether builder owed a duty of care to Owners - whether builder breached duty of care – whether Owners suffered material damage caused by builder’s breach of duty – where damages to be assessed – where purpose of damages to restore Owners to position they would have been in had wrongful acts not occurred – whether evidence of damages claimed

RESTITUTION – whether Owners entitled to recover money wrongly paid to builder on basis of mistake

Electronic Transactions (Queensland) Act 2001 (Qld), s 14

Queensland Building and Construction Commission Act 1991 (Qld), s 77, Sch 1B, s 13(5)

Australia and New Zealand Banking Group Ltd v Westpac Banking Corporation (1988) 164 CLR 662

Bryan v Maloney (1995) 182 CLR 609
Mann v Paterson Constructions Pty Ltd (2019) 267 CLR 560
Pavey &…

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Details
AGLC
Rainbow v Turkovic [2021] QCAT 441
Case
[2021] QCAT 441
Decision Date

CaseChat Overview and Summary

Rainbow v Turkovic is a dispute involving Mr Turkovic and Dr Grogan as plaintiffs and Mr Rainbow as the defendant. The plaintiffs have counter-claimed against Mr Rainbow, seeking damages for negligent works that required rectification by a subsequent builder, as well as a restitutionary claim relating to overpayments made to Mr Rainbow. The case was heard in the Queensland Civil and Administrative Tribunal.

The central legal issues in this case were whether Mr Rainbow was liable for damages for the negligent works performed and whether the plaintiffs were entitled to a restitutionary claim for the overpayments made. The plaintiffs argued that Mr Rainbow's works were defective and that they had overpaid him for work that was never performed. Mr Rainbow, on the other hand, contended that he had completed the work to a satisfactory standard and that the overpayments were justified. The tribunal had to determine the validity of these claims and assess the appropriate amount of damages and restitution.

The tribunal found that Mr Rainbow was not liable for damages for the defective works as the plaintiffs had not provided sufficient evidence to support their claims. However, the tribunal allowed the restitution claim in the amount of $6, 501.55, finding that some of the payments made by the plaintiffs were for work that was not completed or was of an unsatisfactory standard. The tribunal also determined that the plaintiffs were entitled to $36, 847.82 by way of counter-claim for the rectification of defective work. As a result, the tribunal ordered that Mr Rainbow was entitled to $28, 171.29 for the reasonable value of the work completed by him but not paid for. The tribunal did not order any costs to be paid by either party, as both had been partially successful in their claims.

This case highlights the importance of clear contractual agreements and proper documentation in construction projects. The tribunal's decision underscores the need for builders to ensure that their work meets the required standards and for property owners to carefully review invoices and seek rectification of any defective work. Additionally, the case serves as a reminder of the potential consequences of failing to adequately document the scope of works and the terms of any agreements in place.

Orders

Orders of the court

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Background

Background to the litigation

Mr Turkovic and Dr Grogan have counter-claimed against Mr Rainbow, seeking the payment of:(a)Damages for negligent works undertaken by Mr Rainbow and which had to be rectified by a subsequent builder ($90, 799.42 in total); and(b)A restitutionary claim in money had and received, relating to overpayments by them of invoices issued by Mr Rainbow, in some cases for work which they say was never performed ($11, 527.41).Overview of the facts In January 2017 the Owners engaged a builder, Andrew Pty Ltd trading as Norcon Building and Constructions (‘Norcon’) to take over the renovation works from their original builder. The Norcon contract was terminated on 22 December 2017. On 15 December 2017 Dr Grogan and Mr Rainbow had an initial meeting to discuss the renovation works. The next day Dr Grogan emailed Mr Rainbow, enclosing a copy of the renovation plans of the house and some concept drawings. From 16 January 2018 to 4 April 2018 various emails were exchanged between the parties in relation to the works. On 28 April 2018 Mr Rainbow emailed Dr Grogan with a scope of works and scope of carpentry works. On 5 June 2018 Mr Rainbow emailed Dr Grogan a quotation. On 7 June 2018 Mr Rainbow provided to the Owners a scope of works and carpentry scope of works together with two copies of the Master Builders Residential Cost-Plus Level 2 contract. On 9 June 2018 Mr Rainbow provided another quotation in relation to the works in the amount of $546, 786.00. On 29 June 2018 Mr Rainbow provided an updated quotation in the amount of $834, 450.00, a scope of works and specifications for carpentry quoting the price of $87, 692.00. On 30 June 2018 a completed but unsigned Cost-Plus Contract together with a scope of works/quotation in the amount of $672, 200.30, a preliminaries document with additional charges in excess of $10, 000 and a “prime cost items schedule” in the amount of $90, 300 was provided to the Owners. On 2 July 2018 Mr Rainbow commenced work at the house. Mr Rainbow said that the scope of works changed after that due to changes requested or which needed to be done to progress the works. On 8 September 2018 Mr Rainbow provided Dr Grogan an updated quotation in the amount of $578, 304 which included carpentry in the amount of $95, 997.00 (plus a builder’s margin of $78, 859.63 and preliminaries of $14, 932.33). An updated quotation in relation to the carpentry was provided on 15 September 2018 in the sum of $65, 109. On 23 December 2018 Mr Rainbow emailed Dr Grogan a notice of suspension of the works, purportedly under a contract. On 30 January 2019 the Owners’ solicitors wrote to Mr Rainbow terminating the ‘arrangement’, meaning, in the words of the Owners, the arrangement for future performance of work.[2][2]Annexure A to the Further Amended Response and Counterclaim filed on 15 October 2020-at [39]. Between 1 March 2019 and 1 April 2019 the Owners engaged Olemus Pty Ltd, of which Rod Pym was manager and director, on a monthly agreement to complete the works. On 1 April 2019 Kino Constructions Pty Ltd undertook a property dilapidation report.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

I am not satisfied that this amount was charged by Mr Rainbow for work that was not completed by him. Accordingly, this claim is refused.Conclusion The builder is entitled to $65, 019.11 by way of quantum meruit for the reasonable value of the work completed by him but not paid for. The Owners are entitled to the following amounts by way of damages for rectification of defective work: I have allowed the restitution claim in the amount of $6, 501.55. The Owners are entitled to a total of $36, 847.82 by way of counter-claim. Accordingly, the amount owing to Mr Rainbow is $65, 019.11 less $36, 847.82, a total of: $28, 171.29. Mr Rainbow has said he makes no claim as to costs, excluding the filing fee. Considering the Owners had legitimate claims regarding defective work and the invoicing was less than satisfactory, I will not allow this claim. The Owners have claimed costs, subject to the decision, pursuant to s 77(3)(h) of the QBCC Act. Given both parties have been successful to some extent, my preliminary view is that there should be no order as to costs. If the parties wish to be heard on costs, they should file submissions in accordance with the directions made. Otherwise, I will order that there be no order as to costs.

Ratio Decidendi

Legal Principle Established

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