Stewart v Queensland Building Services Authority

CITATION: PARTIES:	Stewart v Queensland Building Services Authority [2010] QCAT 467 CHRISTOPHER STEWART
V
QUEENSLAND BUILDING SERVICES AUTHORITY
APPLICATION NUMBERS:	QR165-09
MATTER TYPE:	General administrative review matters
HEARING DATE:	12 April 2010
HEARD AT:	Brisbane
DECISION OF:	Mr Paul Favell
DELIVERED ON:	27 September 2010
DELIVERED AT:	Brisbane
ORDERS MADE:	The Tribunal orders that the decision of the Queensland Building Services Authority dated 17 July 2009 to direct the applicant to rectify building works carried on at 2/55 Hollywell Road, Biggera Waters be set aside.
CATCHWORDS:	Building work – whether defective – Direction to rectify/ complete building work – category of defective building work – time elapsed – sections 3, 72, 86 Queensland Building Services Authority Act 1991 – Schedule 2 Queensland Building Services Authority Act 1991
APPEARANCES AND REPRESENTATION:	Applicant Mr. C. Stewart Respondent Ms. C. Farthing

REASONS FOR DECISION

Introduction

The Applicant sought to review the decision of the Queensland Building Services Authority (“QBSA”) dated 17 July 2009 to direct the Applicant to rectify building work carried out at the Applicant’s property located at 2/55 Hollywell Road, Biggera Waters, Queensland.
This matter was heard on 12 April 2010 and an order was made that “the decision of the Queensland Building Services Authority dated 17 July 2009 to direct the applicant to rectify building works carried on at 2/55 Hollywell Road, Biggera Waters be set aside”.
Reasons were given at the time the order was made. Both parties have requested written reasons. There has been some difficulty with the recording of the reasons given and the reasons are unable to be transcribed. These reasons have been provided anew.

Factual Background and Claims

2007 Complaint

On or about 24 October 2007 the QBSA received a Complaint Form from the owner of the property in relation to seven (7) items of alleged defective building work undertaken by the Applicant at the property including an alleged water leak in the garage.
On 19 November 2007, a QBSA Building Inspector attended the property in the presence of the owner and the Applicant for the purposes of inspection of the alleged defective building works identified in the complaint.
The QBSA Building Inspector inspected the items identified in the complaint and determined that the items of complaint were Category 2 defective building work in accordance with the Defects Policy and had been notified to the QBSA outside the timeframe permitted under the Defects Policy. On this basis, the QBSA was unable to direct the Applicant to rectify the defective building work.

2009 Complaint

On or about 20 April 2009 the QBSA received a letter from the owner in relation to a water leak in the garage at the property.
On or about 22 June 2009 a QBSA Assessment Officer undertook an assessment of the complaint and recommended that a building inspector re-inspect the property in order to investigate the water leak to the garage.
On 25 June 2009 the QBSA Assessment Officer issued a letter to the Applicant advising that the second complaint had been received and that an inspection would be conducted by a QBSA Building Inspector on 16 July 2009.

10. On 16 July 2009 the QBSA Building Inspector attended the property in the presence of the owner for the purposes of inspecting the alleged defective building work.

11. The QBSA Building Inspector inspected the water leak to the garage and determined that the water ingress was now Category 1 defective building work and that the Applicant was responsible for the defect.

12. The QBSA Building Inspector recommended that a direction to rectify the building work should be issued to the Applicant. Following the inspection, the QBSA Building Inspector prepared an inspection report which outlined the inspection findings.

13. On 17 July 2009 the QBSA Building Inspector caused the Direction to Rectify No. 33292 to be issued to the Applicant to rectify the following items:

“1. Water damaged plaster ceiling linings are evident within the garage. Water has penetrated via the roof / box gutter intersection, parapet flashings not sealed adjacent the balcony and down pipe spreaders loading the short roof sections with high volumes of water which can track into the garage.”

14. On 5 August 2009 the QBSA received notice of the Applicant’s application to the Tribunal which was filed on 22 July 2009.

Applicant’s Claim

The Applicant claims that during the first inspection of the alleged water leak in the garage of the property in 2007, which the Applicant attended, only slight water stains on the plaster were found which the Applicant and QBSA Building Inspector agreed could not be helped due to the cyclonic storms experienced in Queensland. The Applicant and the QBSA Building Inspector also agreed that the problem was further exacerbated by a tree on the property which continually dropped leaves into the box gutter and on the roof. Accordingly, the QBSA found that the Applicant was not liable for rectification of the defect.
On 22 June 2009 the Applicant was informed by a QBSA Assessment Officer that another complaint had been made regarding the alleged water leak in the garage. The Applicant asked the QBSA Assessment Officer if there was any need for him to attend the second inspection of the defect and was advised that it was not necessary for him to attend. The Applicant contends that had they been aware that the building inspection may result in required rectification work or a penalty, the Applicant would have attended the building inspection.
After receiving notice of the direction to rectify the defect, alleged by the QBSA to be caused by parapet flashings not being properly sealed and notice of the penalties imposed on the Applicant’s licence, the Applicant contacted the QBSA Building Inspector to remind him that he had already inspected the alleged defect back in 2007 and had decided that rectification of the defect was not required due to the defect being caused by freak storms. The Applicant claims that the QBSA Building Inspector replied that he had simply changed his mind and could do as he wished.
The Applicant contends that the photos taken by the QBSA Building Inspector at the building inspections do not reveal any significant structural problem but rather a minor water stain.
The Applicant has received a quotation from Ryan Roofing Pty Ltd which states that the problem in their opinion is with the spreader as seen from the QBSA Building Inspector’s photos. The quotation suggests removing the spreader and installing the down pipe into the box gutter. The Applicant contends that this would stop what they believe is the “real problem” of the wind from extreme storms blowing the water back into the roof.
The Applicant claims that this quotation proves that the QBSA Building Inspector’s contention that the parapet flashings had not been properly sealed is false. The Applicant further claims that this is supported by the fact that a neighbouring property was experiencing the same problems.

Respondent’s Response

The respondent submits that, following the inspection by the QBSA, there was found to be “defective” building work in accordance with the Defects Policy and section 72 of the QBSA Act for the following reasons:
(a)The roof / box gutter intersection, parapet flashings and down pipe spreaders do not comply with HB39-1997 Installation Code for Metal Roof and Wall Cladding;
(b)The roof allows water penetration into the Property;
(c)The flashing is faulty because it has not been sealed and therefore does not prevent water penetration; and
(d)There is inadequate provision for discharge of roof water.
The QBSA submits that the building work undertaken by the Applicant and the subject of the second complaint is category 1 defective building work. It is noted that such work was the subject of the first complaint which was considered to be category 2 defective building work.
The QBSA submits that under the QBSA Act, the QBSA has the power to direct the Applicant to rectify building work that is found to be “defective” building work and that power is discretionary according to the QBSA Act. It relies upon the decision in Newstart Homes (SE QLD) Pty Ltd v Queensland Building Services Authority [2008] CCT QR004-06.
The QBSA submits that the second complaint which was found by the QBSA to be category 1 “defective” building work was lodged within time pursuant to the Defects Policy.
The QBSA submits that the nature of the defects at the property warrant the person responsible being directed to rectify the defective work and a person who, for profit or reward, carried out the category 1 defective building should be held accountable for such poor workmanship.
Further, the QBSA submits that it is essential to hold those accountable for such works, particularly for category 1 defective building work, in order to achieve a reasonable balance between the interests of consumers and those unlicensed persons who, for profit or reward, carried out the building work in accordance with the objects of the QBSA Act.
The QBSA contends that, in consideration of these submissions, it is fair in the circumstances to direct the Applicant to rectify the items identified in the Direction, therefore, the Authority exercised its discretion under section 72 of the QBSA Act to issue a direction to the Applicant to rectify the defective building work.
The respondent submits that in the circumstances the Tribunal should confirm the decision under review.

Legislation

The applicant relies on section 72 of the Queensland Building Services Authority Act 1991 (the “QBSA Act”) which relevantly provides:

“Power to require rectification of building work

(1) If the authority is of the opinion that building work is defective or incomplete, the authority may direct the person who carried out the building work to rectify the building work within the period stated in the direction.
(2) In deciding whether to give a direction under subsection (1), the authority may take into consideration all the circumstances it considers are reasonably relevant, and in particular, is not limited to a consideration of the terms of, including the terms of any warranties included in, the contract for carrying out the building work.
…

(5A) In subsection (2), a reference to a contract for carrying out building work includes a reference to a domestic building contract for managing the carrying out of building work.
…

(8) A direction cannot be given under this section more than 6 years and 3 months after the building work to which the direction relates was completed or left in an incomplete state unless the tribunal is satisfied, on application by the authority, that there is in the circumstances of a particular case sufficient reason for extending the time for giving a direction and extends the time accordingly.
…

(14) The authority is not required to give a direction under this section to a person who carried out building work for the rectification of the building work if the authority is satisfied that, in the circumstances, it would be unfair to the person to give the direction.
Example for subsection (14)—
The authority might decide not to give a direction for the rectification of building work because of the amount payable but unpaid under the contract for carrying out the building work.”

Schedule 2 of the QBSA Act defines “building work” to mean:
“building work means –
(a) the erection or construction of a building; or
(b) the renovation, alteration, extension, improvement or repair of a building; or
(c) the provision of lighting, heating, ventilation, airconditioning, water supply, sewerage or drainage in connection with a building; or
(e) any site work (including the construction of retaining structures) related to work of a kind referred to above; or
(f) the preparation of plans or specifications for the performance of building work; or
(fa) contract administration carried out by a person in relation to the construction of a building designed by the person; or
(g) fire protection work; or
(h) carrying out site testing and classification in preparation for the erection or construction of a building on the site; or
(i) carrying out a completed building inspection; or
(j) the inspection or investigation of a building, and the provision of advice or a report, for the following—
(i) termite management systems for the building;
(ii) termite infestation in the building;
but does not include work of a kind excluded by regulation from the ambit of this definition.”
Schedule 2 of the QBSA Act provides that “defective” in relation to building work, includes “faulty or unsatisfactory”.

Section 3 of the QBSA Act defines the objects of the Act as:
“Objects of Act
The objects of this Act are—
(a) to regulate the building industry—
(i) to ensure the maintenance of proper standards in the industry; and
(ii) to achieve a reasonable balance between the interests of building contractors and consumers; and
(b) to provide remedies for defective building work; and
(c) to provide support, education and advice for those who undertake building work and consumers.”
The QBSA Board on 18 March 2004 formulated a policy of dealing with section 72 of the QBSA Act and the power of the Authority to require rectification of building work (the “Defects Policy”). Relevantly, the Defects Policy provides:
“Guideline Policy
It is a guideline policy of the Queensland Building Services Board that a person who carries out category 1 or 2 defective building work should be required to rectify that building work, unless in all the circumstances rectification is an unreasonable remedy.
Under section 72(1) of the Queensland Building Services Authority Act 1991 (the Act), if the Queensland Building Services Authority (the Authority) is of the opinion that building work is defective, the Authority may direct the person who carried out the building work to rectify it.”
Mr Stewart provided a statement which became exhibit 1 and gave evidence. He told the Tribunal that the building work was completed in 2002. The applicant gave evidence that at the latest, the work was completed in January or February 2003. Page 50 of exhibit 4, the statement of the QBSA building inspector Evan Woodruffe, is a note on BSA Memorandum dated 16 July 2009 which includes the note “completed 29/7/03, BSA notified 4/09, CN expires 11/5/09”.
Page 40 of exhibit 4 is an inspection report of an inspection carried out on 16/7/09 which lists “Completion date 29/07/03 (Plumbing final inspection, CN cover to 11/05/09”.
If the building work was completed on 29/07/03, 6 years and 3 months would expire on 29/10/09. If the work was completed in 2002, 6 years and 3 months would expire before the date the direction was given on 17 July 2009. If completed in February 2003, the 6 years and 3 months would expire in May 2009.
I have no reason to disbelieve the applicant and I accept that his evidence has been truthful. He had not raised any question whether a direction could be given because of the expiration of 6 years and 3 months after the completion of the building work. I do not see that he had a reason to make up an incorrect completion time.
I raised the matter of whether the 6 years and 3 months had expired before the direction was issued and noted the submission that the onus was on the applicant to show the date of practical completion. No further evidence was forthcoming. I asked if the respondent was making an application as contemplated in section 72(8) QBSA Act and I was informed that no such application was being made.
I accept the evidence of the applicant and find that a direction could not be given.
If I am wrong about that finding I will deal with the available evidence as if I am standing in the shoes of the Authority.
In exercising the direction pursuant to s 72 QBSA Act, the Tribunal stands in the shoes of the Authority and considers the competing interests of the parties and factors such as the blameworthiness of the owners and the cause of any defective building work.
Was the “building work” defective? I accept that there was water ingress to the garage at the site and the evidence of Mr Woodruffe that there was some water damaged plaster ceiling linings within the garage. The photos of the damage do not illustrate that damage as major but I accept Mr Woodruffe’s evidence that on the second visit a hole had formed in the plaster ceiling and a water stain had appeared across the ceiling.
Mr Woodruffe observed parapet flashing had not been sealed adjacent to the balcony and that rain water was being discharged from a higher roof on to a lower roof via down pipe spreaders. He considered that such contributed to water entering because of wind driven rain.
Mr Woodruffe referred to the Installation Code for metal roofing and wall cladding and relied upon the advice that no spreader should have its discharge entering any part of any building. He said that based on those findings he recommended that the item identified was a Category 1 defect and the BSA Boards Policy “Rectification of Building Work” “required rectification by the applicant”. I do not accept that the policy does have the requirement but rather it allows the Authority to direct rectification after taking into account reasonably relevant circumstances.
Category 1 Defective Building Work under the Policy includes “Building work that is faulty or unsatisfactory because it … allows water penetration into a building”. It includes inadequate provision for discharge of roof water.
The applicant contended that the back of the garage was inspected on the first occasion and there were “very slight water stains on the plaster”. His evidence was that he discussed the matter with Mr Woodruffe and it was agreed that the water was due to “very occasional cyclone storms” and that “there is nothing you can do with regards to the wind blowing water back under the roof”.
The applicant disputed the claim that parapet flashings had not been sealed. He contends that the water has been caused by “freak weather conditions. He said filler strips are not necessary and are not usually used”.
In the context where the defect had been examined two years before the direction was issued and the defect was determined to be a category 2 defect and where there are competing explanations for the water and competing assertions as to the need for additional installation, the evidence is not in my view sufficient to conclude “there was defective building work because there was building work that is faulty or unsatisfactory because it allows water penetration into a building”. That reasoning seems to make assumptions that include an assumption that a water leak cannot occur other than because of defective building work.
In deciding whether to give a direction the Authority may take into account circumstances it considers are reasonably relevant. It was clear at the time of considering whether to issue a direction that there was a contention that the leak was caused by extreme weather conditions and that there was no defective building work. Further the complaint made in 2009 had been made in 2007 and was then considered to be a category 2 defect and the complaint had been made out of time. Another relevant circumstance is the extent of the damage. The photos do not reveal the damage to be extensive but rather in the form of water stains in the garage ceiling. Another circumstance is the reliability of the reasoning that the water stains were caused by defective building works.
In all of the circumstances I find that the discretion to direct the applicant to rectify was not appropriately exercised.

[2010] QCAT 467

27 September 2010