Singh v AusHomes Pty Ltd

Case [2018] QCAT 312

QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL


CITATION:

Singh & Anor v AusHomes Pty Ltd [2018] QCAT 312

PARTIES:

SATPREET SINGH
and
KIRANPRADEEP CHADHA
(applicants)
v

AUSHOMES PTY LTD

(respondent)

APPLICATION NO/S:

BDL150-17

MATTER TYPE:

Domestic building dispute

DELIVERED ON:

21 September 2018

HEARING DATE:

28 May 2018

HEARD AT:

Brisbane

DECISION OF:

Member Traves

ORDERS:

1.   The application is dismissed.

2.   The counter application is dismissed.

CATCHWORDS:

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – THE CONTRACT – CONSTRUCTION OF PARTICULAR CONTRACTS AND IMPLIED CONDITIONS – VARIATIONS building dispute – where building design failed to take into account location of electric pillar box outside the site – where pillar box in way of driveway – dispute as to whether builder or homeowner responsible for relocating the pillar box – where parties agreed to halve the costs of a variation involving Energex relocating the pillar box and builder performing extra associated work – whether variation binding – whether variation signed under duress

Bustfree Pty Ltd v Llewellyn [2013] QCA 103

Thorne v Kennedy (2017) 350 ALR 1

APPEARANCES & REPRESENTATION:

Applicant:

Self-represented

Respondent:

Self-represented

REASONS FOR DECISION

Introduction

  1. The main issue in dispute arises out of the location of an electric pillar box outside the applicants’ house. The location of the pillar box was not taken into account at the time the respondents (AusHomes) designed the applicants’ house. It was not until some months into construction that the problem with the location of the pillar box relative to the driveway was raised and discussed by the parties.

  2. AusHomes argue that the problem was not one about location of the pillar box but of who bore responsibility for the cost of moving it. Eventually, the parties agreed to a variation which involved Energex relocating the pillar box and AusHomes widening the driveway and performing other associated extra work (‘the variation works’). The parties also agreed to each pay half of the cost of the variation works. The respondent maintained that it paid for the cost of extra plants, fill, drop edge beam, supervision costs and waived the builder’s margin.[1]

    [1]Affidavit of Brett Robin Shepherd, filed 4 April 2018, [16].

  3. The applicants argue more generally that AusHomes did not design the house with reasonable care, in particular, by failing to design it in accordance with the ‘original development plan’ and by failing to take into account the Council’s bio basin and the Contour Survey Plan.

  4. The applicants have brought a claim in the Tribunal seeking damages in the sum of $62,116.00 arising from the need to undertake extra works following discovery of the pillar box issue. They seek the following orders:

    Please Order Builder to pay for the following:

    1.To pay for late completion of work as per the contract.

    2.To pay damages for poor and impractical design of the house.

    3.To pay for money we have lost in paying rent and mortgage during the extra time taken by the builder for completion.

    4.To refund the money they have charged illegally and forcefully to…

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Details
AGLC
Singh v AusHomes Pty Ltd [2018] QCAT 312
Case
[2018] QCAT 312
Decision Date

CaseChat Overview and Summary

AusHomes Pty Ltd, the builder, and Mr. Singh, the homeowner, were in dispute over the responsibility for relocating an electric pillar box that obstructed the driveway. The matter was brought before the Queensland Civil and Administrative Tribunal (QCAT) for resolution. The key issues involved whether the parties' agreement to split the costs of relocating the pillar box and the associated works was binding and whether the agreement was signed under duress.

The court examined whether the variation was a genuine compromise of a dispute between the parties concerning responsibility for the relocation of the pillar box. The court noted that the compromise of a disputed claim does not amount to duress merely because it is entered into to close off the matter and bring the dispute to an end without any need to do so or any real challenge to the validity of the demand. The court also found that the applicants were not entitled to any further damages as claimed. The court further found that the applicants were not acting under duress when they signed the variation. The court found that the applicants knew full well what they were doing when they signed the variation and chose to submit to the pressure rather than take an alternative course of action. The court held that the applicants were not entitled to any further damages as claimed.

The court dismissed the application and counter-application. The court found that the contract provided for a 2m fence and that the variation properly reflected the applicants' entitlement. The court found that there was no basis for finding that the agreement was void for duress and no other basis argued as to why it should otherwise be overturned or money paid under it be refunded. The applicants were not entitled to any further damages as claimed. The court found that the applicants were not entitled to any further damages as claimed.

Orders

Orders of the court

1. The application is dismissed.

2. The counter application is dismissed.

Background

Background to the litigation

AusHomes counter claimed for damages for defamation in the sum of $30,628.00 and sought an order from the Tribunal that ‘the applicant remove false and defaming remarks from various web pages and facebook (sic) pages by JS Singh’. The Tribunal however, does not have jurisdiction to decide defamation claims. Accordingly, the counter application is dismissed.Background [2]Application for domestic building dispute, filed 27 June 2017. The parties entered into a contract for the design and construction of a home at Eight Mile Plains on 15 December 2015. The contract was to reach practical completion within 200 days after commencement, subject to clause 17.[3] ‘Commencement’ is defined to mean when the builder commences physical work on the site. The builder commenced construction on site on 22 June 2016. A commencement letter mistakenly dated 24 May 2016 instead of 24 June 2016, was sent by Melissa Farrow, contracts administrator for AusHomes, advising the applicants that the commencement date was 22 June 2016. Practical completion was reached on 16 February 2017 and final payment was made by the applicants on 22 February 2017.[3]HIA New Home Construction Contract, clause 13. By at least mid-September 2016 AusHomes became aware of a ‘site issue’ relating to the relative positions of the driveway as designed and the pillar box. The pillar box was owned by Energex and was located outside the boundary of the applicants’ property and in line with the driveway as designed as at the contract date. AusHomes claimed it knew the pillar box was there but that the responsibility and cost of re-locating it lay with the applicants as land owners. Moreover, that the pillar box could only be moved by Energex. The applicants, on the other hand, argued that prior to signing the contract, AusHomes assured them that the pillar box would be removed or relocated and that ‘everything would be perfect’. On 19 September 2016 an email was sent from AusHomes’ Assistant Manager, Josh Donaghey, to Mr Singh. It said:As you may be aware there is an Energex pillar box located in the middle of your proposed driveway. Efforts to have the pillar box relocated have been unsuccessful. As a result we propose a solution which allows us to keep the Pillar Box in its current location and adds a terrific design aesthetic to your driveway. We propose to add a feature garden to the middle of your driveway (see drawing attached) which will conceal the pillar box and make for an aesthetically pleasing entrance on the drive into your new home. We will add the garden bed and additional driveway costs at no charge. This proposal was later withdrawn by AusHomes because it involved construction over the Council bio-pod which was not permitted. The parties discussed other possible options to resolve the issue over the following weeks. Ultimately, on 13 December 2016 the parties met on site and reached agreement. The agreement was that the pillar box would be relocated and the driveway re-designed. It was also agreed that AusHomes would perform the extra works and that the cost of the extra works would be split 50/50 between the parties, subject to AusHomes signing a variation to that effect.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

I find that the contract provided for a 2m fence and that the variation properly reflected the applicants’ entitlement. Accordingly, this claim is refused. Conclusion Accordingly, while I have some sympathy for the applicants in that the issue of the pillar box should have been resolved at the initial design stage and not during construction, it was subsequently resolved by agreement between the parties. There was no basis for finding that the agreement was void for duress and no other basis argued as to why it should otherwise be overturned or money paid under it be refunded. The applicants were not entitled to any further damages as claimed. Accordingly, the application is dismissed.

Ratio Decidendi

Legal Principle Established

The applicants also argue that construction was delayed due to the location of the pillar box which should have been dealt with prior to the commencement of construction. The applicants argue the builder ceased construction in October 2016 and that any delays associated with the relocation of the pillar box were due to the builder, not Energex. This was because the conduit installed under the driveway by the builder in the course of re-locating the pillar box did not comply with AS/NZS 3.11.3.4 and had to be redone.[5][5]Email from Energex to Mr Singh, dated 7 September 2017.Consideration While the dispute arose out of the location of the pillar box, the parties subsequently agreed to a variation which addressed its re-location. The effect of the variation becomes a central issue in the case.The variation relating to the pillar box The variation was in the nature of a compromise of the parties’ respective rights and obligations which dealt with the issues arising from the location of the pillar box. The applicants claim they signed the variation under duress. They referred to the rent they were paying while their home was under construction, to their mortgage payments and that the house was 90% built and argued that in those circumstances, in effect, they had ‘no choice’ but to accept the proposed variation. The law does not readily set aside contracts on the basis of economic duress. Whether duress exists depends upon the effect of a particular type of pressure on the person seeking to set aside the transaction.[6] It is not necessary that the person’s will be overborne.[7] A person acting under duress may know full well what they are doing but he or she chooses to submit to the pressure rather than take an alternative course of action.[8][6]Thorne v Kennedy (2017) 350 ALR 1, [26].[7]Ibid.[8]Bustfree Pty Ltd v Llewellyn [2013] QCA 103, [21] citing Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40, 45-46. The proper approach is ‘to ask whether any applied pressure induced the victim to enter into the contract and then ask whether that pressure went beyond what the law is prepared to countenance as legitimate’. Pressure is illegitimate if it consists of unlawful threats or amounts to unconscionable conduct.[9] Overwhelming pressure which does not fall within either of these categories will not necessarily amount to duress.[10][9]Ibid.[10]Ibid. The variation was, in effect, a compromise of a dispute between the parties concerning responsibility for the re-location of the pillar box. The compromise of a disputed claim will not amount to duress merely because it is entered into to close off the matter and bring the dispute to an end without any need to do so or any real challenge to the validity of the demand. Equally it does not matter that the claimant is doubtful of its validity as there may be a desire to put an end to disputation to avoid litigation.[11] A genuine compromise was described in these terms in Maskell v Horner:[12]If a person with knowledge of the facts pays money, which he is not in law bound to pay, and in circumstances implying that he is paying it voluntarily to close the transaction, he cannot recover it. … Such payment is not made to keep alive the right to recover it, inasmuch as the opportunity is thus afforded of contesting the demand, and payment in such circumstances is a payment to close the transaction and not to keep it open. Even if the money is paid in the action accompanied by a declaration that it is paid without prejudice to the payer's right to recover it, the payment is a voluntary payment, and the transaction is closed.[13][11]Wigan v Edwards (1973) 47 ALJR 586, 595.[12][1915] 3 KB 106.[13]Ibid 118 (Lord Reading CJ.)