Stuart Homes and Renovations v Denton
[2012] QCAT 43
•18 January 2012
| CITATION: | Stuart Homes and Renovations v Denton and Anor [2012] QCAT 43 |
| PARTIES: | Stuart Homes and Renovations ABN 44985274541 (Applicant) |
| v | |
| Paul Denton Robyn Denton (Respondents) |
| APPLICATION NUMBER: | BDL264-10 |
| MATTER TYPE: | Building matters |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Michelle Howard, Member |
| DELIVERED ON: | 18 January 2012 |
| DELIVERED AT: | Brisbane |
ORDERS MADE: | 1. That the respondents pay to the applicant costs in the sum of $6,005 within 28 days of these orders; 2. That the respondents pay to the applicant interest in the sum of $3,398.50 within 28 days of these orders. |
| CATCHWORDS: | Building dispute – costs application – where applicant successful on substantive claim Queensland Building Services Authority Act 1991, s 77 |
APPEARANCES and REPRESENTATION (if any):
This proceeding was heard on the papers pursuant to section 32(2) of the Queensland Civil and Administrative Tribunal Act 2009.
REASONS FOR DECISION
On 11 November 2011, I made orders in favour of Stuart Homes on its application for orders for the payment of the balance of monies owing to it under a building contract in the sum of $8,207.19. The counter-claim made by the Dentons was dismissed. I directed that evidence and submissions be filed by both parties regarding the application for costs and interest made by Stuart Homes, and that the claims for interest and costs be determined on the papers not before 14 December, 2011.
Stuart Homes filed its material and submissions. The Dentons had until 12 December 2011 to file their material but have not done so. An application was received on 22 December 2011, from Bell Legal Group who appeared on the Dentons’ behalf at the hearing, seeking leave to withdraw as solicitors on the record for the Dentons as they no longer hold instructions to act on their behalf. No explanation is given as to why submissions were not filed by 12 December 2011 as directed and no indication is given that the Dentons intend to file submissions on their own behalf. In any event, the date for them to do so had they wished has long passed and no extension of time has been sought.
The application for costs
In Lyons v Dreamstarters Pty Ltd,[1] the Appeal Tribunal determined that in building disputes, there is a broad general discretion to award costs as a result of the provisions of the Queensland Building Services Authority Act 1991[2] which have modified the usual costs provisions in the QCAT Act. Accordingly, the tribunal may make an order as to costs that is justified in the circumstances.
[1] [2011] QCATA 142.
[2] In particular, section 77(2)(h).
The Dentons’ counter-claim was for $42,706.92. Of this $33,822.95 was for bringing the building up to liveable standard, and $8,385.97 was a claim for interest on the deposit paid to Stuart Homes and rent during the period between payment of the deposit and completion of the works. The counter-claim failed in its entirety. The amended response and counter-claim contained claims and allegations that were not addressed in evidence and were not established at hearing. Stuart Homes argues that it was, while pursing a modest claim, put to considerable additional expense in defending this substantial counter-claim, which it submits was doomed to fail, against it.
Further, it submits that as the QBSA Act does not provide a framework for the determination of costs, the usual rule of costs following the event should apply.
The amount of the costs claimed by Stuart Homes is not particularised. It is asserted that as each party was legally represented and the ‘quantum being somewhat substantial’, an order is sought for costs to be assessed pursuant to section 107(2) of the QCAT Act, under the relevant Magistrates Court scale over $50,000.
Both parties were granted leave for legal representation in January 2011. Stuart Homes claim was for a little over $8,000 plus costs and interest. The Dentons’ counter-claim was for a larger, but still modest amount. The hearing was concluded in one day. The statement evidence relied upon by Stuart Homes is relatively brief consisting of some 16 pages, although there are attachments of a further 90 pages including the contract, variations and progress claims and local authority documentation. The statement material relied upon by the Dentons totals some 21 pages plus attachments.
The Supreme Court of Queensland has held that where a party has reasonably incurred legal costs and has been successful before a tribunal, it could not be said to be in the interest of justice to allow that success to be eroded.[3] I am satisfied that in the circumstances of the case, namely that the applicant has been successful, and the Dentons wholly unsuccessful, and that the success of Stuart Homes will be eroded if a costs order is not made, that it is in the interests of justice in the circumstances to make an order for costs in favour of Stuart Homes.
[3] Tamawood Ltd v Paans [2005] 2 Qd R 101, [33] per Keane J.
Section 107(1) of the QCAT Act provides that if costs are awarded under an enabling Act, they must be fixed if possible. However, I have been given no information about the extent of the costs claimed, other than that costs are sought under the Magistrates Court Scale over $50,000. Schedule 3, Part 3 of the UCPR provides that it applies if the amount recovered or claimed by a plaintiff is over $50,000. Part 2 applies up to $50,000. The basis for Stuart Homes’ submission for costs under the scale over $50,000 is not apparent, given the claims made, unless they are added together. Whereas the issues for determination were complicated to some extent by the Dentons’ case, it does not appear to me that the evidence filed for Stuart Homes would have been significantly different in the absence of the Dentons’ counter-claim, and so I do not consider that it is reasonable for costs to be awarded on the higher scale.
[10] Under Schedule 3 Part 2, at scale F ($10,001 to $20,000), I consider it is reasonable to award costs as follows:
a) instructions to sue allowed 1,065.00;
b) preparing for trial if counsel is engaged 3,225.00; and
c) counsel’s fees on hearing – first day 1,460.00.
[11] I also consider that the Dentons should pay the costs of the filing fee paid by Stuart Homes of $255. The total amount of costs awarded is therefore, $6,005.
The application for interest
[12] The claim for interest has several components.
[13] Stuart Homes also seeks orders that interest be paid by the Dentons for all monies outstanding from time to time under the contract which it calculates to the date of the decision as follows:
| Particulars | |||
| Balance carried forward | $4,729.19 cr | ||
| 20.10.2009 | Invoice Interest on $29,791.15 at 20% per annum (25.10.2009 to 01.11.2009 (8 days)) | $34,520.34 $130.59 | $29,791.15 dr |
| 28.10.2009 | Invoice Interest on $35,449.94 at 20% per annum (02.11.2009 to 30.11.2009 (29 days)) | $5,658.79 $563.31 | $35,449.94 dr |
| 30.11.2009 | Payment received | ($29,000.00) | $6,449.94 dr |
| 27.02.2010 | Interest on $6,449.94 at 20% per annum (01.12.2009 to 03.03.2010 (93 days)) Invoice | $328.68 $7,757.25 | $14,207.19 dr |
| 01.04.2010 | Interest on $14,207.19 at 20% per annum (04.03.2010 to 01.04.2010 (29 days)) Payment | $225.76 ($3,000.00) | $11,207.19 dr |
| 08.04.2010 | Interest on $11,207.19 at 20% per annum (02.04.2010 to 08.04.2010 (7 days)) Payment | $42.99 ($3,000.00) | $8,207.19 dr |
| 31.07.2010 | Interest on $8,207.19 at 20% per annum (09.04.2010 to 11.11.2011 ( days)(sic)) | $2,617.31 | |
| Total interest | $3,908.64 |
[14] Interest at the rate of 20% per annum calculated on a daily basis until payment of the amount ordered in full is also sought. In the alternative interest is claimed pursuant to the Supreme Court Act 1995 until payment.
[15] The schedule of the written contract between the parties nominates interest on overdue amounts at a rate of 20% under clause 14(e). By virtue of clause 14 and the schedule, the Dentons were required to pay progress claims five days after submission of progress and final claims for payment.
[16] I accept that under the contract, the Dentons had an obligation to pay interest on the amounts outstanding under progress claims which were not paid within the specified five days until paid.
[17] Progress claims were rendered as follows:
a)Progress claim 1 was made on 6 July 2009 for $20,209.96;
b)Progress claim 2 was made on 29 September 2009 for $15,480.77;
c)Progress claim 3 was made on 20 October 2009 for ($35,854.14 which included a double–up charge for variations of $1333.80 already rendered in progress claim 2 which is deducted leaving) $34,520.34 properly rendered in this claim.
d)Progress claim 4 was made on 28 October 2009 for $5,658.79;
e)Progress claim 5 on 27 February 2010 for $7,757.25.
[18] Payments were made by the Dentons as follows:
a)$20,209.96 was paid on 10 July 2009;
b)$20,209.96 was paid on 1 October 2009;
c)$29,000 was paid on 30 October 2009;
d)$3,000 was paid on 1 April 2010; and
e)$3,000 was paid on 9 April 2010.
[19] Having regard to these claims and payments, interest is payable under the contract to the date of the decision as follows:-
a)Interest on $29,791.15 at 20% per annum for period 25 October to 29 October 2009 (5 days) $81.62;
b)Interest on $791.15 at 20% per annum for the period 30 October 2009 to 1 November 2011 (3 days) $1.30;
c)Interest on $6,449.94 at 20% per annum for the period 2 November 2009 until 3 March 2010 (122 days) $431.17;
d)Interest on $14,207 at 20% per annum for the period 4 March 2010 to 31 March 2010 (28 days) $217.97;
e)Interest on $11,207.19 at 20% per annum for the period 1 April 2010 to 8 April 2010 (8 days) $49.13;
f)Interest on $8,207.19 at 20% per annum from 9 April 2010 to date of decision 11 November 2011 (582 days) $2,617.31.
[20] The interest payable under the contract to the date of the decision is therefore $3,398.50. I am satisfied that it is appropriate to make orders that the Dentons pay this amount of interest to Stuart Homes, and I make orders accordingly.
[21] Under section 77(2)(c) of the Queensland Building Services Authority Act 1991, I may award interest as prescribed by regulation from the date an amount becomes payable until it is paid. If the parties entered into a contract, interest awarded is payable at the rate specified in the contract.[4] I have no evidence or submissions regarding whether some or all of the monies to be paid by the Dentons to Stuart Homes in accordance with my orders of 11 November 2011 have been paid. Given the relatively small amount of the claim and that I have awarded costs and interest to the date of the decision in favour of Stuart Homes, I am not satisfied that it is appropriate to make orders for the payment of interest on the amount awarded.
[4] Queensland Building Services Authority Regulation 2003, section 34B.
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