Sallur v Howse - [2014] QCAT 313

CITATION:

Sallur v Howse [2014] QCAT 313

PARTIES:	Kenneth Jon Sallur Karen Ann Sallur (Applicants)
v
Anthony Bruce Howse Betty May Howse (Respondents)

APPLICATION NUMBER:

BDL161-13

MATTER TYPE:

Building matters

HEARING DATE:

23 June 2014

HEARD AT:

Brisbane

DECISION OF:

Member Gardiner

DELIVERED ON:

27 June 2014

DELIVERED AT:

Brisbane

ORDERS MADE:

1. Mr and Mr Sallur pay Mr and Mrs Howse the sum of $9,210.00 in full and final satisfaction of this matter by 11 July 2014.

2. Mr and Mrs Howse file in the Tribunal two copies and give to Mr and Mrs Sallur one copy of any application with any written submissions and supporting documentation in relation to costs by 18 July 2014.

3. That Mr and Mrs Sallur file in the Tribunal two copies and give to Mr and Mrs Howse one copy of any submissions and supporting documentation in response to the application for costs by 8 August 2014.

4. Mr Howse file in the Tribunal two copies and give to Mr and Mrs Sallur one copy of any submissions in reply by 22 August 2014.

5. The application for costs be determined by the Tribunal on the papers without an oral hearing not before 22 August 2014.

CATCHWORDS:

BUILDING – REVIEW – Dispute between builder and home owner about the erection of a kit shed – WHERE final invoice not paid because of allegations of defects by home owners – WHERE experts have different views of workmanship of builder– WHERE one expert must be preferred – WHETHER there are major defects with the construction of the shed

Queensland Building and Construction Commission Act 1991 (Qld)

Loveday v Renton and Wellcome Foundation Ltd [1990] 1 Med LR 117 followed

APPEARANCES and REPRESENTATION (if any):

APPLICANT:

Kenneth Sallur
Karen Sallur

RESPONDENT:

Anthony Howse
Betty Howse

REASONS FOR DECISION

Mr and Mrs Howse own a property in Roma and in 2011 accepted a quote from Mr and Mr Sallur to erect a shed on their property.
Mr Sallur admits that during the measuring up of the setting out stage of the project, there was a mistake made and that one side of the set out was incorrectly measured by 100 millimetres.
The shed is a kit and everything was supplied. Mr Sallur quoted on the provision of labour and concrete to erect the shed. There was no formal contract between these parties other than the quote provided by dated 30 August 2010 and counter-signed by Mr Howse.
All did not go to plan. Mr and Mrs Howse were not happy with the result and declined to pay the invoice provided by Mr Sallur at the end of the build.
Mr and Mrs Sallur filed an application for a minor civil dispute in the Roma Courthouse. This was transferred to QCAT as a building matter under a practice direction of this Tribunal and became a domestic building dispute. Mr and Mrs Howse effectively allege the work was not performed to an industry standard.
QCAT is empowered by the Queensland Building and Construction Commission Act 1991[1] to decide a building dispute[2]. The contract in dispute is also reviewable as domestic building work under the Domestic Contracts Act 2000. This Act contains a number of implied warranties in every regulated contract[3]. These conditions include a warranty that the work will be performed ‘in an appropriate and skilful way and with reasonable care and skill’.[4] If this warranty (implied in the contract by the legislation) is breached, damages in the form of compensation for the actual loss, can be awarded to the innocent party. The damages must not be too remote and the non-breaching party must act reasonably to mitigate the loss where possible.
[1]sections 76 and 77.
[2]Defined under schedule 2 of this Act to include a domestic building dispute.
[3]See Part 4 of that Act.
[4]Domestic Contracts Act 2000 s 44.
There is also an implied warranty in the contract between the parties that the work will be carried out in a proper and tradesman like manner.[5]
[5]BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 52 ALJR 20 at 26.
As well as the payment of the invoice of $16,280, Mr and Mrs Sallur seek further costs of a filing fee of $275, a service fee of $82 and interest at the rate of 10 per cent. In the application, this totals $19,723.51.
At the conclusion of the hearing Mr Sallur suggested that he would take a payment of $15,000 all up as a reasonable outcome to settle this invoice as he admits that a mistake was made in the measuring process.
Mr and Mrs Howse wish to be relieved of the burden of paying the invoice as provided by the builder and have provided a quote for rectification as part of a building report. This estimates the cost of rectification of the works at $25,489.33. Minus the invoice cost, this would mean a payment by Mr and Mrs Sallur to Mr and Mrs Howse of $9,210 (rounded up). If successful in his application, Mr Howse would also apply for costs subsequent to the handing down of this decision.
Sadly neither the builder nor the homeowner wish to have any further contact with each other. Having discussed with them the normal building process of allowing the builder back to rectify his work out of the contract, it is very clear that neither man wishes to have any further contact with the other. In any event, further work done by Mr Sallur would potentially not finalise the proceedings between him and Mr Howse. It may only lead to further litigation by way of any further alleged defects.
In the circumstances, in order to conclude all matters between these parties the parties submitted that any award to either party should be made by way of a determination of a cash amount.
A total of four expert reports were provided as part of the evidence. Only one expert had been arranged by the parties to attend and so the Tribunal took it upon itself to contact the lead report writer for the applicants. Both the main report writers relied upon by the parties were then available to give concurrent evidence at the hearing.
Mr Brian Payne a consulting engineer with Brandon & Associates Pty Ltd provided a report for the applicants. Mr Payne gave evidence that he based his report on an earlier report of Adam Trewin, a structural engineer of two years standing also from Brandon & Associates Pty Ltd and on information supplied by the builder. He did not himself inspect the property.
Mr Sallur also supplied a copy of an initial inspection report undertaken by a building inspector dated 11 October 2011 for what was then the Queensland Building Services Authority. This report covers three complaints made by Mr and Mrs Howse. Those complaints are that the columns were not central to the hold-down bolts, that the bracing did not conform the engineers design in the manufacturer’s specifications and finally, that the concrete was low quality concrete.
All of these complaints were found to be category 1 defects under the classification used by the BSA. However, the BSA concluded that the issues between the parties were contractual and should be settled in a court of law.
Mr and Mrs Howse rely on a joint report of two structural engineers from the Roma Chinchilla area, being Mr Graeme Wells the senior engineer and Mr Philip De Guzman another structural and geotechnical engineer.
As set out in the introduction to this report, both of these men conducted detailed inspections of the shed although on different days. Both of these men work for GBA Consulting Engineers in Barcaldine, Mr Wells being a senior civil engineer and managing partner of the firm.
Roma is a small place. All of these parties know each other and some have worked in the past together. The experts in particular are well aware of the work of the other.
It is unfortunate however that both of these experts take different views of the construction of this shed. It therefore falls to me to prefer one of the reports to the other about this particular shed.
In the English decision of Loveday v Renton and Wellcome Foundation Ltd[6] Lord Justice Stuart-Smith comprehensively sets out his indicia for the evaluation of conflicting expert evidence. His Honour first comments that the mere expression of a belief or opinion, however eminent, does not suffice and the court must evaluate the witness and the soundness of his opinion. His Honour lists useful criteria for the evaluation of expert witnesses were one must be preferred over another. In evaluating these experts I have been guided by these criteria.
[6][1990] 1 Med LR 117 at 125.
Mr Payne accepts that his report has a number of assumptions in it. First, that there was agreement between the homeowners and the builder on a number of important issues for example, whether a concrete slab floor was to be laid in the building in the short or medium term and second that the information upon which the report was written was based on the advice given to him by the builder.
Both of these assumptions have problems. It is clear from the evidence in the hearing that the parties agree on little and that Mr and Mrs Howse deny that prior to construction starting on the shed, there was any indication to the builder that a concrete floor was to be laid. Mr Howse says he did ‘dream’ of this in the future and did speak to the builder about that future possibility about two thirds of the way through the build but that it was not discussed prior to the start of the build.
It is also clear from the evidence of the parties and the experts that a shed is not built in the Roma area to anticipate a concrete floor being laid at a later date. Yet Mr Payne when viewing the shed, assumed that the parties had agreed to a concrete floor because of the observations of the photographs supplied to him.
Further Mr Payne’s report is not based on his own observations although he did have measurements and photos of his colleague, and on the information supplied by Mr Sallur. Mr Sallur admitted in the hearing that his memory of some of the details (because it was so long ago) is now hazy.
Mr Payne and the writers of the Wells’ report are all qualified structural engineers. Having read the detailed reports of Mr Wells and his colleague and the more general report of Mr Payne, I prefer the evidence of Mr Wells and his associate. Mr Wells and his associate Mr Guzman had the advantage of an independent examination of the shed and the destructive examination of one of the piers upon which to base their report. Mr Payne did not have the advantage on this occasion of either direct observation or independent testing. Mr Payne says he would have liked to undertake some testing independently of the advices given to him by the builder.
Mr Wells’ report also contains a copy of an email from Mr John Towler another structural and civil engineer in the Roma area. Mr Guzman wrote to Mr Towler concerning the construction of the pier footings the column to pier connection and the wall/roof bracings.
Mr Towler’s reply to Mr Guzman is as follows:
You are right to be concerned the footings as poured are not acceptable. I would demand they be done again. If you decide to repair rather than replace I would be happy to do the loading assumptions. However they are not secrets and are merely AS1170.2 uplift loads by roof area supported by COL. Additional allowance for braced panels is usually allowed in the design of tie downs. The footing designs however do assume good soil conditions however I would be careful with their use.
The initial report by the less experienced structural engineer in Mr Payne’s own firm (Mr Adam Trewin) is not supportive of the construction methods. In Mr Trewin’s view, his observations as outlined in his short report resulted in reduced tie down capacity and sheer resistance of the column connections which reduced long term durability of the fixings due to lack of covering concrete.
At the hearing, Mr Payne indicated that Mr Trewin’s report should not be accepted as the report of Brandon & Associates and that his report superseded Mr Trewin’s.
There have been three engineers who have inspected the site and two engineers who have commented on information provided to them as to the quality and structural integrity of this shed. Of those five engineers, Mr Payne is the only engineer who considers that the work is done to a satisfactory standard.
On the weight of this evidence and on the concerns that I have raised about Mr Payne’s reliance on information not observed by him directly and of information provided by the builder, I am satisfied in this matter on this occasion, I prefer the evidence of Mr Wells and his associate.
I therefore accept as defects the structural performance issues outlined in Section D of Mr Wells report dated 2 May 2014 and the unsatisfactory workmanship that arises from those decisions. The main issues that arise for me out of the report are:
a)    that there was a mistake made in the setting out which was not satisfactorily rectified;
b)    that Mr Sallur did not build this kit home to the manufacturer’s specifications, for example he made his own decisions about placement of bracing and reduced the amount of bracing in the structure;
c)    that because of the eccentricity and the relative positions of the columns, the pier caps and the piers, the loading on the piers could lead to high stressors in the piers or pier caps and in the soil bearing pressures as compared with a pier that is centrally located.
I am satisfied that there appears to be a cold joint between the pier and the capping which is not explained satisfactorily by Mr Sallur and therefore representing a plane of weakness. I am also satisfied that the integrity of the moulded specified base connection along the right or western wall where the additional steel plates have been welded to allow for the incomplete measuring has not been verified by an engineer and could possibly be subject to fatigue and durability issues.
I also accept the other concerns raised by Mr Wells in Section F to his report. By accepting Mr Wells’ report, I also accept that the proposed method of rectification is in these circumstances the appropriate method to place Mr and Mrs Howse in the position that they should have been in if the contract had been properly completed.
There was some discussion at the hearing to the possibility of relocating the shed. This would involve Mr Sallur returning to the property, dismantling the shed, redoing the fittings and re-erecting the shed with the necessity of providing some extra equipment to account for larger drill holes.
Overall I am not satisfied that in these circumstances this is an appropriate rectification method. It does not finalise matters between the parties. It potentially leads to further areas of litigation should there be any further defects found in Mr Sallur’s workmanship. There is no goodwill left and both men do not want the other to be involved in anyway at this point.
In the circumstances, I am therefore satisfied that the appropriate outcome is a payment in money as discussed at the beginning of these reasons. I am satisfied that it is equitable that Mr and Mrs Howse be relieved of their obligations under the invoice supplied by Mr and Mrs Sallur for the erection of the shed and that Mr Sallur should pay to Mr and Mrs Howse an amount representing the costs of rectification over and above the invoice price.
As discussed at the beginning of these reasons that amount is $9,210.00.
I order that Mr and Mrs Sallur pay Mr and Mrs Howse in the sum of $9,210.00 in full and final satisfaction of this matter by 11 July 2014.
I will make further directions for the filing of any application for costs.