SURI and BEYOND BUILDERS PTY LTD - [2024] WASAT 20

JURISDICTION     :   STATE ADMINISTRATIVE TRIBUNAL
ACT: BUILDING SERVICES (COMPLAINT RESOLUTION AND ADMINISTRATION) ACT 2011 (WA)
CITATION:   SURI and BEYOND BUILDERS PTY LTD [2024] WASAT 20
MEMBER:   MR E CADE, MEMBER
HEARD:   19 FEBRUARY 2024
DELIVERED          :   26 MARCH 2024
FILE NO/S:   CC 784 of 2023
BETWEEN:   HARISH KUMAR SURI
Applicant
AND
BEYOND BUILDERS PTY LTD
Respondent

Catchwords:

Home building work contract complaint - Home building work remedy order - Whether stage progress payment is not payable by owner and should be repaid by builder - Whether price variation claimed by builder should be disallowed - Whether requiring builder to reach practical completion is an order which requires specified work to be performed - Meaning of lock-up stage - Damages for delay in completion of home - Whether damage includes emotional harm, disappointment and distress - Discretion

Legislation:

Building Act 2011 (WA), s 34
Building Services (Complaint Resolution and Administration) Act 2011 (WA), s 5, s 5(1), s 5(2), s 6(3)(b), s 7(1)(a), s 11(1)(c), s 12, s 17, s 17(a)(i), s 38, s 41, s 41(2), s 41(2)(a)(i), s 41(2)(a)(ii), s 41(2)(a)(iv), s 41(2)(c), s 41(2)(d)(i), s 43, s 43(1), s 43(2)(a)
Building Services (Complaint Resolution and Administration) Regulations 2011 (WA), reg 6, reg 6(2)
Home Building Contracts Act 1991 (WA), s 7, s 7(1), s 7(3), s 8, s 8(1)(b), s 8(3), s 8(3)(b), s 8(4), s 10, s 10(1)(b), s 10(3), s 13, s 17, s 17(a), s 17(a)(i), s 27, s 27(1), Pt 2
State Administrative Tribunal Act 2004 (WA), s 32(6)(c), s 55

Result:

Application allowed in part

Category: B

Representation:

Counsel:

Applicant	:	In Person
Respondent	:	In Person

Solicitors:

Applicant	:	N/A
Respondent	:	N/A

Case(s) referred to in decision(s):

Alison Louise Lobbe atf Lobbe Newman Trust and Kelpie Endeavours Pty Ltd atf Testa Rossa Family Trust and Quality Builders Pty Ltd [2014] WASAT 110
Byham and Afra Construction Pty Ltd [2014] WASAT 38
Cardona v Brown [2012] VSCA 174
Chalakuzhy and Olsen [2017] WASAT 104
Deshmukh and Distinctive Building Services Pty Ltd [2024] WASAT 15
Dumbreck and Tangent Nominees Pty Ltd [2017] WASAT 88
Gemmill Homes Pty Ltd v Sanders [2018] WASC 179
Jetpoint Nominees Pty Ltd and Lee [2021] WASAT 10
KBE Contracting Pty Ltd and Mawer & Anor [2007] WASAT 210
Lampman and Afra Constructions Pty Ltd [2014] WASAT 27
Lee v Lawfirst Pty Ltd [No 2] [2023] WASCA 166
Owners of Island Apartments Strata Plan 52597 and Pindan Pty Ltd [No 2] [2018] WASAT 2
Vernon v Ashmy Pty Ltd WADC (unreported 23 January 1997, Library No BC9740021
Vitte and Studio 8 Builders & Designers Pty Ltd [2013] WASAT 43
Waldron and Afra Construction Pty Ltd [2013] WASAT 207
Yao-Jing Li v Minister for Immigration & Multicultural Affairs (1997) 74 FCR 275

REASONS FOR DECISION OF THE TRIBUNAL:

Introduction

These proceedings concern a home building work contract (HBWC) complaint made by the applicant to the Building Commissioner pursuant to s 5(2) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA) (BS(CRA) Act). The applicant is the owner of the home the subject of the complaint (owner). The respondent is the builder of the home (builder).
The owner's complaint is that he entered a fixed price HBWC on 21 December 2020 pursuant to which the builder was to construct a new home for the owner by 9 February 2022, but after building the home to the lock-up stage in February 2023 the builder suspended work and will not resume the work unless the owner agrees to increase the price, or agrees to substantially reduce the cost of the finishes and fittings the builder will install in the home.
The owner requested the Tribunal make orders (which the Tribunal understood as a request the Tribunal make HBWC remedy orders pursuant to s 43 of the BS(CRA) Act) that:
(a)requires the builder to immediately resume building the home and bring it to practical completion within three to five months;[1]
(b)requires the builder to repay the roof cover and the lock-up stage progress payments on the basis these were not genuine progress payments;[2]
(c)disallows variations claimed by the builder that:
(i)increases the contract price by $111,000,[3] and
(ii)reduces the cost to the builder of finishes and fittings the builder will install in the home;[4] and
(d)requires the builder to pay compensation to the owner for the financial loss and caused to him by the builder's delay in achieving practical completion of the home.[5]
[1] The Tribunal has assumed this order is sought pursuant to s 41(2)(a)(ii) or s 41(2)(a)(iv) of the BS(CRA) Act.
[2] The Tribunal has assumed the orders are sought pursuant to s 41(2)(c) of the BS(CRA) Act.
[3] The Tribunal has assumed the order is sought pursuant to s 7 and s 8 of the HBC Act and s 41(2)(c) of the BS(CRA) Act.
[4] The Tribunal has assumed the order is sought pursuant to s 7 and s 8 of the HBC Act and s 41(2)(a)(i) of the BS(CRA) Act.
[5] The Tribunal has assumed the order is sought pursuant to s 41(2)(d)(i) of the BS(CRA) Act.
The builder denies the owner is entitled to any of these orders.
The proceedings were listed for final hearing at the Tribunal on 19 February 2024. Neither party elected to give evidence at the final hearing, nor did either party call any witnesses to give evidence at the final hearing.

Procedural history

The proceedings originated with a notice of complaint containing eight complaint items given by the owner to the builder on 16 April 2023 and two further complaint items given on 18 April 2023.[6]
[6] Pursuant to reg 6(2) of the BS(CRA) Regulations a complainant must, 14 days before making a complaint to the Building Commissioner under s 5(1) or s 5(2) of the BS(CRA) Act, give to a respondent written notice of the proposed complaint together with a reasonable description of the remedy sought by the complainant and the evidence on which the complainant proposes to rely.
On 1 June 2023 a delegate of the Building Commissioner referred nine of the 10 complaint items to the Tribunal pursuant to s 11(1)(c) of the BS(CRA) Act for it to deal with pursuant to s 43 of the BS(CRA) Act.[7] [8]
[7] The delegate referred complaint items 1 – 3 and 5 to 10 to the Tribunal and rejected complaint item 4.
[8] Pursuant to s 12 of the BS(CRA) Act the Building Commissioner on referring a complaint to this Tribunal does not become a party to the proceeding (unless joined to the proceeding), and the complainant to the Building Commission becomes the applicant in the proceedings before the Tribunal.
The nine building complaint items referred to the Tribunal are set out in Annexure A. Alongside each complaint item is the order sought by the owner in his closing submission, as well as the builder's response to the complaint item and to the orders sought.

The proceedings in the Tribunal

Prior to the final hearing the owner, in accordance with orders made by the Tribunal on 23 November 2023, lodged with the Tribunal and gave to the builder his written statement of orders sought and the book of documents on which he intended to rely at the hearing. In turn, the builder lodged with the Tribunal and gave to the owner its written response to the owner's statement and the book of documents on which it intended to rely at the hearing.
In accordance with its usual practice, the Tribunal compiled these documents into a paginated hearing book (HB) which it made available to the parties prior to the final hearing.
At the commencement of the final hearing on 19 February 2024[9] the Tribunal:
(a)informed the parties that the presiding member was to preside at two other final hearings in February 2024, each of which involved an application for HBWC remedy orders against this builder. The parties were informed that each was a separate hearing, and it gave each party an opportunity to make submissions on this issue. Neither party elected to do so; and
(b)explained to the parties their right to make opening and closing submissions, to call and give evidence and to examine, cross‑examine and re-examine witnesses.[10]
[9] In addition, the Tribunal informed the owner that he bore the burden of proof in these proceedings, in reliance upon Jetpoint Nominees Pty Ltd and Lee [2021] WASAT 10 at [69]: 'Even in proceedings within the Tribunal's original jurisdiction where, like the plaintiff in civil court proceedings, the applicant bears the onus or legal burden of proving their case on a balance of probabilities, and the hearing consequently has an adversarial character, such as building dispute proceedings, as in the original proceeding …'. However, following the final hearing, the Tribunal became aware of the observations of Smith AJ in Gemmill Homes Pty Ltd v Sanders[2018]WASC 179 at [123] citing Yao-Jing Li v Minister for Immigration & Multicultural Affairs (1997) 74 FCR 275, 288: '… In administrative proceedings, unless an onus is expressly created by statute or arises by inference from the statute, a party to proceedings does not legally bear an onus of proof of a particular material fact'. The Tribunal was not required to resolve this issue in this proceeding as except for matters relating to the statutory onus in s 10(3) of the HBC Act, nothing in these proceedings turned on whether a party did or did not bear an onus or a legal burden to prove its case or to prove a material fact.
[10] State Administrative Tribunal Act 2004 (WA) (SAT Act), s 32(6)(c).
Pursuant to s 55 of the State Administrative Tribunal Act 2004 (WA) (SAT Act) the Tribunal ordered the removal of pages 153 - 156 and the redaction of paragraphs 20 and 21 at page 118 of the HB, as the owner objected to them as they referred to matters discussed at a mediation conference held at this Tribunal.
With the consent of the parties, the redacted version of the HB was then admitted into evidence as Exhibit 1. The documents in Exhibit 1 then became evidence in the proceeding.
The owner submitted that as neither party has terminated the HBWC it remains on foot and the builder is required to complete the building works for the price and to the specifications set out in the HBWC.
The builder accepted that the HBWC required it to complete the building works by 9 February 2022, and that it last performed work on the site in February 2023. The builder submitted it is willing to resume the building works but due to the unprecedented increase in the cost of labour and materials since 21 December 2020 it cannot do so unless it is permitted to increase the contract price or to reduce the cost to the builder of certain finishes and fittings to be installed in the home.

Statutory framework

These proceedings are within the original jurisdiction of the State Administrative Tribunal (Tribunal) pursuant to the Home Building Contracts Act 1991 (WA) (HBC Act) and the BS(CRA) Act.
The legislation relevant to the proceedings are sections 7, 8, 10, 13, 17 and 27 of the HBC Act, sections 5, 41 and 43 of the BS(CRA) Act and reg 6 of Building Services (Complaint Resolution and Administration) Regulations 2011 (WA) (BS(CRA) Regulations).

The BS(CRA) Act

In these proceedings the Tribunal's power to make a HBWC remedy order pursuant to s 43 of BS(CRA) Act is dependent on certain preconditions being met. These are that:
(a)a complaint by the owner about a price variation claimed by the builder is not valid must be made within 10 working days after notice of the variation was given to the owner;[11]
(b)each complaint by the owner that the builder is in breach of the contract must not be a breach in respect of which a building remedy order may be made, and also must not be made more than 3 years after the cause of action arose;[12] [13] and
(c)each HBWC remedy order must relate to a complaint item that has been referred by the Building Commissioner to the Tribunal.[14]
[11] HBC Act, s 8(3)(b) and s 8(1)(b).
[12] BS(CRA) Act, s 17(a)(i).
[13] BS(CRA) Act, s 6(3)(b).
[14] BS(CRA) Act, s 43(1).
The Tribunal will now consider each of these pre-conditions in turn.

The complaint by the owner pursuant s 8(3) of the HBC Act must be made within 10 working days

Section 8(3) of the HBC Act prevents an owner from making a complaint about a price increase pursuant to s 8(1)(b) of the HBC Act unless the complaint is made within 10 working days after notice was given by the builder of the claimed price increase.
The owner's notice of complaint in respect of the complaint relating to the price increase claimed by the builder on 16 April 2023 was given to the builder on 18 April 2023.
The Tribunal therefore finds that the owner, by giving his notice of complaint in respect to the price increase to the builder on 18 April 2023, did make his complaint within the time required by s 8(3) of the HBC Act.

The complaints by the owner are not as to breaches in respect of which a building remedy order may be made, and must not be made more than 3 years after the cause of action arose

The owner's complaint in this proceeding is made pursuant to s 5(2) and s 17 of the BS(CRA) Act.

Pursuant to s 17(a)(i) of the HBC Act, an owner may make a complaint pursuant to s 5(2) of the BS(CRA) Act only if the complaint alleges a breach of contract which is not a breach in respect of which a building remedy order may be made.[15] A building remedy order may be made in respect of a complaint that building work is not carried out properly or proficiently or that it was faulty or unsatisfactory.
[15] Pursuant to s 38 of the BS(CRA) Act, a building remedy order may be made in respect of a complaint that a regulated building service 'has not been carried out in a proper and proficient manner or is faulty or unsatisfactory'. In general terms, this is a complaint that a building service has been performed to an unacceptable standard.
In his building complaint the owner did not complain that the builder's work was not carried out properly or proficiently or that it was faulty or unsatisfactory, except to the extent that he complains the roof leaked. However, the owner complains that the roof leaked because it was incomplete, not because it was built improperly or not proficiently or that it was faulty or unsatisfactory.
The owner's cause of action in respect of his complaint that the builder is in breach of the HBWC arose on the date by which the home was to reach practical completion pursuant to the HBWC, which was 9 February 2022. His cause of action in respect of his complaint about the price increase claimed by the builder arose on the date he gave notice to the builder that he rejected the price increase, which was 18 April 2023. His cause of action in respect of his claim for repayment of the roof cover stage and lock-up stage progress payments arose on the date on which he made those payments to the builder, which was 20 June 2022 and 21 December 2022 respectively.
The owner made his complaint to the Building Commissioner about these causes of action on 2 May 2023, with the result that each complaint was made within the 3 year period required by s 6(3)(b) of the BS(CRA) Act.
The Tribunal therefore finds that none of the owner's complaints are complaints about which a building remedy order could be made, but rather that they are complaints about which a HBWC remedy order might be made. The Tribunal also finds that the complaints were made within the time required by s 6(3)(b) of the BS(CRA) Act.

Each HBWC remedy order must relate to a complaint item that has been referred to the Tribunal.

The Tribunal has considered whether each HBWC remedy order sought by the owner relates to a complaint item that has been referred by the Building Commissioner to the Tribunal.
The proposed HBWC remedy order the builder resume the home building works is within complaint item 1. The proposed order the builder repay the roof cover stage progress payment is within complaint item 8 and it repay the lock-up stage progress payment is within complaint item 6. The proposed order disallowing the price increase of $111,000 claimed by the builder is within complaint item 9. The proposed order disallowing the reduced cost to the builder of certain finishes and fittings is within complaint item 2. The proposed order the builder pay the owner compensation for his financial loss and emotional harm is within complaint items 1, 5 and 10. The proposed order the builder pay compensation by way of interest on deposit paid to a third party for kitchen cabinets is within complaint item 7.
The Tribunal is therefore satisfied each order sought by the owner relates to a complaint item referred by the delegate of the Building Commissioner to the Tribunal.

The discretion to make a HBWC remedy order under s 43(1) of the BS(CRA) Act

Section 43(1) of the BS(CRA) Act provides:
(1)If the Building Commissioner refers a HBWC complaint to the State Administrative Tribunal, the Tribunal may —
(a)if satisfied that the order is justified, make a HBWC remedy order; or
(b)otherwise, decline to make the order[.]
The Tribunal considered the proper construction of the discretion conferred by s 43(1) of the BS(CRA) Act in Deshmukh and Distinctive Building Services Pty Ltd [2024] WASAT 15. The Senior Member in that decision said at [59] - [60]:
59In my view the considerations concerning whether a HBWC remedy order is justified to resolve a HBWC complaint that a respondent has breached a home building work contract are:
(1)Is there a valid home building work contract between the applicant and the respondent to the proceeding?
(2)What are the relevant terms of the contract?
(3)Has the respondent breached the relevant terms of the contract?
(4)Has the applicant suffered loss, damage, or detriment which can be addressed by a HBWC remedy order?
60In my view, if the Tribunal is satisfied that there is a valid home building work contract between the applicant and the respondent, and that the respondent has breached a relevant term of the contract which can be addressed by way of a HBWC remedy order then the Tribunal is required to make a HBWC remedy order. It then has a discretion regarding the HBWC remedy order it will make under the provisions of s 41(2) of the BSCRA Act.
The Tribunal accepts this construction is the proper construction of s 43(1) of the BS(CRA) Act.

The home building works contract (HBWC)

It is not in dispute and the Tribunal therefore finds that the HBWC contained the following details and terms:
(a)clause 2: The parties to the HBWC are Harish Kumar Suri and Beyond Builders Pty Ltd;
(b)clause 2: The registered building practitioner is Atalla Abbas, who the director of the builder;
(c)clause 2.2 timing: The commencement date for works is either 10 business days after either loan approval or a building permit is obtained, whichever is the later, and the finish date is 300 days after the works have commenced;
(d)clause 3: The contract price is $380,000;[16]
[16] The original price of $370,000 was increased by agreement to $380,000 on 21 January 2021.
(e)specifications addenda: The finishings are to be of 'Standard Level';[17] and
[17] The specifications were varied by handwritten variations to some of the items signed by the parties on 21 January 2021.
(f)clause 4: Progress payments fall due as each of the following stages of works are done:

Payment stage

% of contract price

   Amount $

1.      Deposit

5%

$18,500

2.      Ground slab

15%

$55,500

3.      Ground floor plate height

8%

$29,600

4.      Suspended slab

5%

$18,500

5.      Upper floor plate height

8%

$29,600

6.      Roof cover

13%

$48,100

7.      Lock-up

16%

$59,200

8.      Fixing (Fit-out)

20%

$74,000

9.      Practical completion

10%

$37,000

Payment stage	% of contract price	Amount $
1. Deposit	5%	$18,500
2. Ground slab	15%	$55,500
3. Ground floor plate height	8%	$29,600
4. Suspended slab	5%	$18,500
5. Upper floor plate height	8%	$29,600
6. Roof cover	13%	$48,100
7. Lock-up	16%	$59,200
8. Fixing (Fit-out)	20%	$74,000
9. Practical completion	10%	$37,000

Some notable features of this HBWC are that:
(a)clause 11 does not permit the builder to increase the price except by way of a variation to the scope of the building works;
(b)it does not make time of the essence;
(c)it does not provide for liquidated damages due to delay;
(d)it does not contain any provision as to the termination of the contract; and
(e)it does not provide an estimated amount for prime cost items or a means by which those items can be priced during the building process.
The Tribunal notes that no party asserted that any of the documents in Exhibit 1 were anything other than genuine documents. Based on the common documents in Exhibit 1 the Tribunal is satisfied the following additional matters are not in dispute in this proceeding, and the Tribunal therefore finds that:
(a)the building permit was issued on 9 April 2021;
(b)'days' in the HBWC means calendar days and not working days, and as the building works commenced on 15 April 2021 the builder was to achieve practical completion by 9 February 2022;
(c)the builder demanded the owner pay the roof cover progress payment on 22 May 2022 and the owner paid the builder $48,100 on 20 June 2022;
(d)on 15 August 2022 the builder sent to the owner a schedule of allowances for various finishes and fittings and requested the owner contact the suppliers nominated in the schedule to select their preferred items;
(e)the builder demanded the owner pay the lockup progress payment on 16 November 2022 and the owner paid the builder $59,200 on 21 December 2022;
(f)on 7 April 2023 the builder proposed to the owner that it would resume the building works and complete them for the contract price if the owner agreed to perform certain works himself. It is accepted by the builder that the owner did not accept this proposal and the builder does not submit that this proposal constitutes a variance of the HBWC;[18]
(g)the building permit expired on 9 April 2023 and has not been renewed;
(h)on 16 April 2023, the builder gave the owner notice of a $111,000 price increase, which the owner rejected on 18 April 2023;[19]
(i)during the 300 day building period the builder did not give notice that the building works would be delayed or that the builder required an extension of time to complete the works; and
(j)the builder has not performed work on the build since February 2023.
[18] The works the builder proposed the owner perform were 'tiling; concrete works to the garage, cabinetry and stone works; internal painting; sanitary and plumbing fixtures; kitchen appliances; supply of lights, switches and sockets; shower screens; balustrades; garage door; blinds and curtains; exposed concrete and paving works; solar panels intercom system; CCTV and security; letter box and sliding robes'.
[19] It appears that the builder overlooked the $10,000 price increase agreed to by the owner in January 2021, with the result that it calculated the 30% price increase on the amount of $370,000 and not $380,000. Nothing, however, turns on this.
While the parties disagree as to what stages of the building works have been completed by the builder, the parties do agree the home did not achieve practical completion by 9 February 2022, and nor has it ever reached practical completion. The Tribunal therefore finds by not bringing the home to practical completion by 9 February 2022, or within any reasonable time after that date, that the builder is in breach of clause 2.2 of the HBWC.

Issues in dispute/issues to be decided

The following issues are in dispute and need to be decided in this proceeding:
(a)whether the builder is required to resume building the home pursuant to the HBWC and, if so, whether the Tribunal has the power to require the builder to do this;
(b)whether the owner's payment of $48,100 to the builder for the roof cover stage was a genuine progress payment within the meaning of s 10(1)(b) of the HBC Act and, if not, whether the Tribunal should make a HBWC remedy order requiring the builder to repay that money;
(c)whether the owner's payment of $59,200 to the builder for the lock-up stage was a genuine progress payment within the meaning of s 10(1)(b) of the HBC Act and, if not, whether the Tribunal should make a HBWC remedy order requiring the builder to repay that money;
(d)whether the builder's claim for a price increase pursuant to s 8(1)(b) of the HBC Act is a valid claim and, if so, whether the HBWC price is increased by $111,000;
(e)whether the builder's proposal to reduce the cost to the builder of certain fittings and finishings in accordance with a schedule of allowances was agreed to by the owner and, if so, whether the HBWC is varied by incorporating this schedule into the HBWC;
(f)whether the owner has suffered a financial loss due to the builder's breach in not achieving practical completion by 9 February 2022 and, if so, whether the Tribunal should make a HBWC remedy order that the builder pay compensation to the owner for his financial loss; and
(g)whether the owner has suffered emotional harm due to the builder's breach in not achieving practical completion by 9 February 2022 and, if so, whether the Tribunal should make a HBWC remedy order that the builder pay compensation to the owner for his emotional harm.
The Tribunal will now deal with each of these issues in dispute in turn.

Whether the builder is required to resume building the home pursuant to the HBWC and, if so, whether the Tribunal has the power to require the builder resume building the home

The owner requests the Tribunal order the builder to immediately resume the building works and bring the home to practical completion within three to five months of commencing the works.
The HBWC remedy orders the Tribunal may make are set out in s 41 of the BS(CRA) Act. This section does not confer on the Tribunal a power to order a builder to resume building works in accordance with a HBWC, rather it confers on the Tribunal the power to make a HBWC remedy order:
(1)'requiring any specified work to be done' in the performance of the HBWC;[20] and
(2)'requiring any specified work to be done to remedy a breach of the' HBWC a provision in part 2 of the HBC Act.[21]
[20] BS(CRA) Act, s 41(2)(a)(ii).
[21] BS(CRA) Act, s 41(2)(a)(iv).
The Tribunal has previously considered whether it has the power to make an order in the terms sought by the owner in Chalakuzhy and Olsen [2017] WASAT 104. The Tribunal at [37] - [40] said:
37.… Section 41(2)(a)(ii) of the BS(CRA) Act empowers the Building Commissioner to make an order requiring any 'specified work' to be done in performance of the relevant contract. The wording used in the provision of course needs to be given its natural and ordinary meaning. In this regard assistance is again given by the Macquarie Dictionary Online (2017) as to the definition of 'specify':
1.to mention or name specifically or definitely; state in detail.
2.to give a specific character to [.]
38.In the Tribunal's view where an order which requires work to be performed, which if not complied with can lead to disciplinary action and/or an applicant seeking to exercise their rights pursuant to s 51 of the BSCRA Act, it is important that it is clear in the terms of the order what is being required of the respondent. This is consistent with the ordinary and natural meaning of the word 'specified'.
39.To specify work to be performed, such work must be set out in a clearly identified and unambiguous manner. It is not specifying work to be done to issue an order which is ambiguous, broad or vague in its terms.
40.Order 1 of HBWC remedy order 1 of 2017, however, simply provides '[t]he respondent is to bring the building service at 18 Leaside Way, Spearwood to practical completion …'. It is often the case that parties have differing views regarding what is required for a contract to reach practical completion. In the Tribunal's view this is not an order capable of being made under the legislation. This is because, in the Tribunal's view, it does not specify the work which is required to be performed in order to allow an assessment to be made by the parties, the Building Commissioner and the Tribunal as to whether the order has in fact been complied with once the date requiring compliance has passed.
The Tribunal agrees that '[t]o specify work to be performed, such work must be set out in a clearly identified and unambiguous manner'. In the Tribunal's opinion, there should also be evidence the specified work is required pursuant to the HBWC as well as evidence of the estimated the value of each of the specified work it orders a builder to perform.[22] So as to ensure that any order made was certain and enforceable, there should also be evidence as to the reasonable time it would take a builder to complete the specified work.
[22] Pursuant to s 43(2)(a) of the BS(CRA) Act, the Tribunal is not able to order work to be performed where the total value of the work exceeds $500,000.
The Tribunal is therefore satisfied it can make a HBWC remedy order that a builder performs specified work to be done in performance of the HBWC or to remedy a breach of the HBWC, subject to the requirements that:
(a)the specified work can be set out in a clearly identified and unambiguous manner;
(b)there is evidence that the specified work is required pursuant to the HBWC;
(c)there is evidence as to the reasonable time it would take the builder to complete the specified work; and
(d)there is evidence as to value of each of the specified work.
It would be preferable in contentious matters such as this if there was evidence from an independent expert as to each of these matters. In this proceeding though there is no such evidence.
The only evidence at all as to the work which is required to complete the home is the document titled 'List Works till the Practical Completion of 19 Scutage St, Brabham' which the builder sent to the owner on 7 April 2023. The builder sent this document to the owner as part of its proposal that it would resume the building works if the owner agreed to take responsibility for the cost of some of the works.
In their closing submissions, both the owner and the builder submitted the list of building works sent by the builder on 7 April 2023 is sufficient to meet the requirements of s 41(2)(a)(ii) and s 41(2)(a)(iv) of the BS(CRA) Act.
However, the list is nothing more than a general description of work to be performed. The listed works do not include those details which would permit a builder to know with certainty what it is the builder should do, what materials it should use, how long it would reasonably take it to complete the work nor what the value of the work is likely to be. For this reason, the Tribunal is not satisfied this list of building works is 'set out in a clearly identified and unambiguous manner'.
The Tribunal is therefore not satisfied that a HBWC remedy order that requires the builder to resume building the home is justified. Pursuant to s 43 of the BS(CRA) Act the Tribunal must decline to make an order pursuant to either s 41(2)(a)(ii) or s 41(2)(a)(iv) of the BS(CRA) Act with respect to this complaint item.

Whether the owner's payment of $48,100 to the builder for the roof cover stage was a genuine progress payment within the meaning of s 10(1)(b) of the HBC Act and, if not, whether the Tribunal should make a HBWC remedy order requiring the builder to repay that money

Section 10(3) of the HBC Act provides a payment demanded by a builder in accordance with a schedule of progress payments set out in a HBWC is 'taken to be a genuine progress payment for the purposes of subsection (1)(b)(i) until the contrary is shown'.
Pursuant to s 41(2)(c) of the BS(CRA) Act, the Tribunal may declare 'that a specified amount is not payable to a person under the contract and, if already paid, an order that the builder or owner repay that amount'.
Pursuant to clause 4.1 of the HBWC, the builder is entitled to demand payment for a stage of work that it has done. Clause 4.1 of the HBWC states:
At the relevant stages defined in the Act,[23] the Builder may demand and recover or retain amounts by way of progress payments for the Work done that are not a greater percentage of the Contract Price than permitted in the Act.
[23] Act is defined in the HBWC as 'the Building Act 2011 of Western Australia'.
The Tribunal is satisfied the word done in the clause is synonymous with completed or finished.[24]
[24] Macquarie Dictionary Online: verb 1. past participle of do – adjective 2. executed; completed; finished; settled.
The owner paid the roof cover progress payment to the builder on 20 June 2022. The owner claims that at the time of the final hearing the roof is still incomplete, and the builder should therefore repay him the roof cover stage progress payment in the amount of $48,100.
The issue whether the roof cover progress payment 'is not payable … under the contract' is to be decided by determining whether at this time the roof cover work is complete.
The builder's email to the owner on 22 May 2022 demanding the roof cover progress payment pursuant to the schedule of progress payments in the HBWC shows that as at that date only some of the roofing materials had been supplied, and that none of the roofing work had yet been performed. The builder in the email said:
This is in regards to the Payment for Roof Cover Stage.
As you may already be aware of, we have purchased and paid for the roof timber a while ago and we have paid for the carpenter labor fees who they are going to start the roof framing mid-this week, plus we have just paid the deposit for the roof sheeting materials upfront to secure the materials.
Due to the massive expenses spent upfront as preparations for the roof cover stage, it seems we have to send through our progress invoice for the Roof Cover stage to enable our cash flow to cover the outgoing costs and expenses involved in the timber purchase, carpentry fees and colorbond sheets deposits.
The timber prices have gone up almost triple the original prices at the time when we signed the contract, therefore we are just unable to continue without getting our Roof Cover payment ahead.
We hereby request your kind understanding to process the attached invoice for the Roof Cover stage which is going to help our cashflow so we can secure the colorbond sheets as there is a huge shortage of materials unless we pay everything upfront.
Attached: Invoice for the Roof Cover stage.

The Tribunal therefore finds that at the time when the builder made this demand for the roof cover stage payment that it was not a demand for a genuine progress payment.
The owner relies on the report of his building expert, Mr Syed Ali, to show that the roof is still not complete. Mr Ali describes his qualification as 'Engineer Australia Membership' and says that he is both a licensed Building Practitioner and a licensed Builder. Mr Ali inspected the home on 28 November 2023.
Mr Ali stated in his report, 'Roof was not complete'. This statement was alongside a photograph of a portion of the roof taken from inside the home with a red arrow superimposed on the photograph. No explanation was given as to what the arrow was pointing to, and the significance of the arrow is not known to the Tribunal. Mr Ali also stated in his report that 'The roof was leaking at the time of inspection'. Mr Ali provided no reasons in support of any of the statements he made in his report, and he was not called to give evidence at the final hearing.
The owner in his submissions also relied on a bundle of undated photographs in Exhibit 1 which he says also shows that the roof is not complete. The owner claimed that the photograph on page 63 of Exhibit 1 shows a gap between the brick height and the roof height in the alfresco area which should be covered by cladding. The owner also submitted the photographs show that the alfresco eaves have not been installed. The owner submitted that the photograph on page 75 shows that the upper floor downpipes, which he says are part of the roof cover works, have not been installed.
The Tribunal notes that while the photographs that were included in Mr Ali's report also show these same details, that Mr Ali did not rely on them as indications that the roof cover stage was not complete.
The builder submitted that while the roof cover stage was not complete at the time it demanded payment for this stage from the owner, that it performed the roof cover work in February 2023 and so the roof works are now complete. The builder submitted that:
(a)while the downpipes have not been installed, it is industry practice not to install them until after the external walls have been finished due to the potential that they will be damaged during the finishing works. That is, the installation of down‑pipes is not part of the roof cover stage but is part of a later stage of work;
(b)while the alfresco eaves have not been installed, it is industry practice not to instal eaves as part of the roof cover stage. Those works are performed as part of the fixing (fit-out) stage;
(c)while there is a vertical gap between the brick height and roof on the alfresco area which will need to be covered with cladding, the cladding is installed when the external walls are fixed. That is, the cladding is installed as part of the later fixing (fit-out) stage and is not part of the roof cover stage; and
(d)a leak in the roof is not an indication that the roof is not complete, rather it may be a minor defect which requires rectification work.
The builder submitted that as the roof cover stage is now complete that it should not be ordered to repay the progress payment to the owner.
The Tribunal has considered the owner's submission but is not persuaded that the roof cover work is at this time not complete. Accordingly, pursuant to s 10(3) of the HBC Act, as the contrary has not been shown, it must find that the payment for roof cover work was a genuine progress payment. The Tribunal therefore finds that the roof cover progress payment would now be payable, if it had not already been paid.
The Tribunal is therefore not satisfied that a HBWC remedy order is justified with respect to this progress payment, and so pursuant to s 43 of the BS(CRA) Act it must decline to make an order pursuant to s 41(2)(c) of the BS(CRA) Act with respect to this complaint item.

Whether the owner's payment of $59,200 to the builder for the lock-up stage was a genuine progress payment within the meaning of s 10(1)(b) of the HBC Act and, if not, whether the Tribunal should make a HBWC remedy order requiring the builder to repay that money

On 17 November 2022, the builder sent the following text message to the owner:
Hi Bro, in regards to our lock up payment, I know the lock up is only done for the upper floor only, but we've already paid for the glass for ground floor and doing the plastering (which was not part of the lock up), also we have paid for the ceiling, air conditioning, plumbing, everything we have paid upfront, so in general we have paid lots of money and as you already know brother the price increase of materials and labour have heavily affected us, therefore if you want us to continue we need this payment to maintain the cashflow, if you want us to help you then you have to help us as well by releasing the payment as soon as possible, we have many commitments to do for your house and everyone is asking for upfront payments.
The Tribunal finds that this text message shows that at the time when the builder demanded the lock-up stage payment on 17 November 2022 that the ground floor of the home was not at lock-up stage. The consequence must therefore be that at the time when the builder made its demand for the lock-up stage payment that the demand was not for a genuine progress payment.

The owner paid the lock-up stage payment of $59,200 to the builder on 21 December 2022. The owner submits that as the home is still not at lock-up stage that the Tribunal should order the builder to repay him the amount of $59,200.
For the reasons already given, the issue as to whether the lock-up progress payment 'is not payable to [the builder] under the contract' is to be resolved by determining whether at this time the lock-up work is or is not complete.
The owner submitted the home is not at lock-up because the photographs in Exhibit 1 show that the alfresco glass sliding doors have not been installed in the opening into the home in that area, but rather the opening to the alfresco area has been secured by a fence.[25] He also submits that the interior walls have not been plastered and the ceilings have not been installed, and that these works are required to be done before the home has achieved lock-up.
[25] The builder in its closing submissions committed to installing the alfresco area sliding doors by 29 February 2024. On 5 March 2024, the owner lodged with the Tribunal correspondence which stated this had not been done. On 19 March 2024, the builder lodged with the Tribunal an email from a manufacturer of windows stating that all its products had been removed from the home in late 2023 and when the manufacturer attempted to locate them it found that they had been scrapped. The manufacturer committed to manufacture and instal new products.
The term lock-up stage is, unhelpfully, not defined in the HBWC. The owner submitted that the website of the Department of Energy, Mines, Industry Regulation and Safety provides an information pamphlet Building contracts and progress payments which gives a definition of the lock-up stage. The definition is:
Externally:
•The structure is now able to be secured, hence the term lock up. All external doors and windows have been installed. In some cases external door openings are secured temporarily to prevent damage to specialist timber frames and doors, but generally all glazing and glass sliding doors have been fitted.
•Rendering of the external walls (if part of the proposed structure) may be complete at this stage but painting or texturing comes later.
Internally:
•First fit plumbing and electrical (pipes and wires have been run but are not functional).
•Wall plastering and ceilings have been installed.
Generally, the structure is ready internally for the finishing trades such as carpenters, electricians, cabinet makers, tilers, plumbers, and painters.
The owner, however, did not include this material in his book of documents but sought to introduce it in his opening submission. The builder, after examining this pamphlet, objected to the late introduction of this material.
Whilst the Tribunal did uphold the builder's objection to the introduction of this pamphlet into evidence, it would not have been satisfied even if the pamphlet was in evidence that lock-up is achieved only when, in addition to the securing of the external openings to the house, that the interior walls of the home have been plastered and the ceilings have been installed. This is because Tribunal notes the progress stage definitions in the pamphlet are preceded by the following qualification:
On the following page is a set of common progress claim stages and descriptors which may be used when building a new home. These are simply intended to serve as a general guide, as each home building project needs to be considered on a job-by-job basis in constructing an appropriate progress claim schedule.
As this definition is a qualified 'general guide' the Tribunal is not satisfied it establishes that the lock-up stage in every home building work will mean that the interior walls of the home will have been plastered and that the ceilings will have been installed.
The owner also relies upon the report of Mr Ali to show that the lockup stage is not complete. Mr Ali stated in his report, 'The house is not considered to be a lock up stage'. Mr Ali did not give any reasons in support of this statement.
Mr Ali's report included 15 photographs which show parts of the interior and exterior of the home as at 28 November 2023. The Tribunal is satisfied that with the exception of the garage door opening, all window and door openings visible in these photos are secured by glass windows, glass doors and a solid door. The Tribunal is satisfied these photographs show that no interior wall plastering work has been done or that any ceilings have been installed.
The builder submitted that the lock-up stage requires only that all external openings to the home (but not to the garage) are secured, and it does not require that the doors which are put in are permanent doors or that the interior walls are plastered or that the ceilings are installed.
The builder submitted that the interior of the home is secured by a door inside the garage area and that the garage door is installed at the fixing stage. The builder's submission is that with the exception of the garage door opening that all external openings to the home have been secured and the home is at lock-up stage.
The Tribunal, in in the absence of an accepted industry definition of the term lock-up stage, accepts the literal definition proposed by the builder which is that lock-up is achieved when all external openings to the structure have been secured. However, even on this definition, the home is not yet at lock-up as the garage opening which forms part of the home has not been secured. The Tribunal has reached this finding by applying the reasoning of the Victorian Court of Appeal in Cardona v Brown [2012] VSCA 174 at [78]:
In determining the question of whether the garage was part of the home, importance must be placed on the terms of the contract and, in particular, what the owner and builders were contracting for. As described at the outset of these reasons, the contract was for the builders to carry out 'the Building Works', comprising a 'brick veneer dwelling' to be built in accordance with the plans. … The plans of the dwelling included the construction of the garage. The contract price included the construction of the garage. The agreed staged payments were expressed as a percentage of the contract price. The price for the construction of the garage was not distinguished as a separate item from the construction of the house, nor did it have its own specific payment regime. On entering into the contract, what the parties were contracting for was the construction of a dwelling including the garage. The owner undertook the liability for progressive payments, expressed as a percentage of the contract price, measured against a staged progression in the construction of the dwelling. The 'dwelling' that was agreed between the parties to be constructed, the owners' new 'home', included the garage[.]
The Tribunal is satisfied that as the garage is an integral part of the home, that unless the garage opening is secure the home is not at lockup.
The Tribunal therefore finds that:
(a)the demand by the builder on 17 November 2022 for the lock‑up stage payment was not a demand for a genuine progress payment;
(b)the owner on 21 December 2022 paid the builder $59,200 for the lock-up stage payment; and
(c)as at the date of the final hearing the home is not at the lock‑up stage as the garage opening is not secured.
The Tribunal therefore finds that the failure to secure the garage door opening shows to the contrary that the demand by the builder for the lock-up stage payment is not at this time a demand for a genuine progress payment, and so it is not now payable by the owners.
The Tribunal is therefore satisfied that a HBWC remedy order is justified with respect to this progress payment, and so pursuant to s 43(1) of the BS(CRA) Act it must make a HBWC remedy order with respect to this complaint item. The order the Tribunal will make is that pursuant to s 41(2)(c) of the BS(CRA) Act the builder is to repay to the owner the amount of $59,200.
The owner also claims interest on his progress payment at the rate of 6% per annum. The Tribunal finds that on proper construction s 41(2)(c) of the BS(CRA) Act confers on the Tribunal a power only to declare a 'specified amount' is not payable and then, if that amount has already been paid, to 'order that the builder … repay that amount' (Emphasis added).
The Tribunal therefore finds it is only able to order the builder to repay the 'specified amount' of $59,200 to the owner, and that it has no power to order the builder pay interest on the amount.

Whether the builder's claim for a price increase pursuant to s 8(1)(b) of the HBC Act is a valid claim and, if so, whether the HBWC price is increased $111,000

Clause 11 of the HBWC deals with variations. It states:
11.Variations
This clause identifies the process for varying this contract.
11.1The Builder and the Building Owner acknowledges that the Work may be varied at the request of the Builder or Building Owner on the terms in the Act and in this clause.
11.2Unless agreed in writing between the Builder and the Building Owner, any adjustments to the Contract Price because of an approved Variation will be taken into account at the time of the next progress payment.
11.3The Building Owner can terminate the contract by notice to the Builder stating that the Building Owner is unable to meet the cost of the Variation because:
a)the Variation is due to a matter that could not reasonable have been expected to be needed for the Work to be completed; or
b)the Variation is due to a requirement of an approving authority or any other statutory authority, which was not known at the date of the contract.
This clause permits the builder to vary the price only when the scope of the building works is varied. The builder, however, has only claimed a price increase and does not attempt to vary the scope of the building works. The builder can therefore only validly claim an increase in the price by agreement between the parties pursuant to s 7 of the HBC Act, or, pursuant to s 8(1)(b) of the HBC Act on the basis of a circumstance that has arisen 'that could not reasonably have been foreseen by the builder at the time when the contract was entered into'.
It is agreed by the parties the builder gave the owner notice of the price increase by email at 9:08 pm on Sunday 16 April 2023. It is useful to set this email out in full:
Hi Harish,
As you and all the people of WA aware of, the construction industry has been plagued with a spate of price increases caused by a perfect storm of supply chain disruptions, skilled labour shortages and skyrocketing costs of materials and logistics.
We hereby sending you this Price Increase Notice for the construction of your house at #19 Scutage St, Brabham. As a minimal, the average rate of the overall price increase for materials and labour is ranging around 25% to 35%. We are requesting a rate of 30% for the average overall price increase as per the below calculations:
•Contract Value: $370,000
•Price Increase: 30% x $370,000 = $111,000.
The above amount can be paid either in one off payment or in progress instalments till the completion of works. Should you have any questions please do not hesitate to contact us[.]
The parties agree the owner rejected this notice of price increase by an email it sent to the builder on 18 April 2023. Consequently, as the owner did not agree to the variation pursuant to s 7 of the HBC Act, the HBWC price can only be validly increased if the builder's claim satisfies the requirements set out in s 8(1)(b) of the HBC Act. There are three such requirements relating to s 8(1)(b) of the HBC Act.
The first requirement is that s 8(1)(b) of the HBC Act applies only in circumstances 'that could not reasonably have been foreseen by the builder at the time when the contract was entered into'.
In this proceeding the Tribunal understands the builder's claim of supply chain disruptions to be a reference to the impact of the COVID‑19 Pandemic, which emerged in January 2020. However, the only evidence from the builder on this issue are the emails the builder sent to the owner on 22 May 2022 to say '[t]he timber prices have gone up almost triple the original prices at the time when we signed the contract …', and its email dated 16 April 2023 which is set out above.
In the absence of any evidence about the impact of the COVID‑19 Pandemic the Tribunal is unable to make any findings as to whether any such circumstances did in fact impact the materials supply chain or the availability of labour in May 2022 and April 2023, and so it is also unable to make a finding that the circumstances were not reasonably foreseen by the builder at the time it entered the HBWC on 21 December 2020.
The second requirement is that a notice given pursuant to s 8(1)(b) of the HBC Act must be given within 10 working days after the builder 'became aware, or should reasonably have become aware, of the circumstances' which gave rise to the notice.
The builder emailed the owner on 22 May 2022 to say '[t]he timber prices have gone up almost triple the original prices at the time when we signed the contract …'. The Tribunal therefore finds the builder did know there were significant increases in the price of materials for far longer than 10 days before it made its claim for the price increase on 16 April 2023.
The third requirement is that s 8(4) of the HBC Act does not permit a builder to vary the HBWC under subsection 8(1)(b) by reason only of an increase of costs of labour or materials, or both, to be incurred by the builder. The builder's emails of 22 May 2022 and 16 April 2023 state that the builder claimed the price increase on 16 April 2023 only because of the increase in the cost of materials and labour.
As the builder's notice does not meet either of the two requirements in s 8(1)(b) of the HBC Act and is contrary to the third requirement under s 8(4) of the HBC Act, its notice of a price increase on 16 April 2023 is not a valid variation of the HBWC and must be disallowed.
The Tribunal is therefore satisfied that a HBWC remedy order is justified with respect to the price increase claimed by the builder, and so pursuant to s 43(1) of the BS(CRA) Act the Tribunal must make an order with respect to this complaint item. The order the Tribunal will make is that pursuant to s 41(2)(c) of the BS(CRA) Act it will declare that the sum of $111,000 claimed by the builder is not payable by the owner to the builder under the HBWC.

Whether the builder's proposal to reduce the cost to the builder of certain fittings and finishings in accordance with a schedule of allowances was agreed to by the owner and, if so, whether the HBWC is varied by incorporating this schedule into the HBWC

Pursuant to s 41(2)(a)(i), the Tribunal may by order restrain 'any specified action in breach of the contract'.
On 15 August 2022 the builder sent to the owner its proposal to reduce the cost to the builder of completing certain finishes and fixings as part of the building works. It is useful to set out this email in full.
Hi Harish,
Hope this email finds you well. This is about the selection of finishing materials and other internal items for your house. Please see below the list of our suppliers and your allowance for each item. If your selections are within the allowances we will pay the supplier, but if your selections go beyond the allowances then you have to pay the extra differences of course. Please call them individually and make appointments for visits:
1.Sanitary/Plumbing fixtures: QA Bathrooms in Malaga - call Nuraini on 08 9249 2026 (your allowance is $5,750 for sinks, tapware, showers, toilets, basins, etc).
2.Tiles: Malaga Tile Centre - call Jerry on 08 6118 1666 (your allowance is $26 per square meter rate for any type or size).
3.Kitchen appliances: Harvey Norman Malaga - call Gill on 0402 193 325 (your allowance is $4,750 for all oven, cooktop, rangehood, etc).
4.Cabinetry/Stone works: Casvino Kitchens in Malaga - call Cassandra on 0467 741 761 (your allowance is $28,000 for kitchen scullery, laundry, bathroom vanities, alfresco kitchen store shelving, linen shelving, robes shelving, WIR shelving, mirror sliding doors, etc).
5.Doors, Handles, Locks:Executive Doors & Mouldings in Malaga - call Natalie on 08 9248 2596 (your allowance is $4,750 for all timber doors, locks and handles)[.]
The owner submitted the builder's email was a request to vary the HBWC by varying the 'Standard Level' specifications set out within the HBWC. This was because, for example, rather than the builder paying for and installing a 'Set of 900 mm Oven, Cooktop & Rangehood from ARTUSI (Italian)' the builder would instead pay only $4,750 toward the costs of these items and the owner would pay the price difference. The owner submitted that as he did not formally accept this proposed price variation that it cannot then be a valid variation to the HBWC.
The builder in its closing submissions said the owner selected certain items from the suppliers it nominated in its proposal, and that the builder then paid for these items and had them delivered to the home. The builder submitted that the owner's act of selecting items constituted acceptance through conduct such that the HBWC was then validly varied in accordance with its email of 15 August 2022.
The owner in his closing submissions accepted that he did select some items from the nominated suppliers. Indeed, it is also evident that the owner paid $10,000 to Casvino Kitchens in December 2022.
Section 7(1) of the HBC Act states variations to a HBWC are to be in writing, are to set out the terms and the cost of the variation and are to be signed by both the owner and the builder.
In this proceeding the proposed variation was in writing, and it did set out the terms of the proposed variation, but it did not set out the cost of the variation and neither was it signed by the owner and the builder. However, a breach of s 7 of the HBC Act does not of itself render the contract or a provision of the contract illegal, void or unenforceable.[26]
[26] HBC Act, s 27(1). See also Vitte and Studio 8 Builders & Designers Pty Ltd [2013] WASAT 43.
In the circumstances set out above the Tribunal accepts the builder's submission that in selecting some items from the suppliers nominated by the builder as well as paying $10,000 to Casvino Kitchens, that the owner did through his conduct accept the builder's proposed variation.
The Tribunal therefore finds the builder's proposed variation sent to the owner on 15 August 2022 was accepted by the owner, and that it therefore constitutes a valid variation of the HBWC.
The Tribunal is therefore not satisfied that a HBWC remedy order is justified with respect to the builder's claim to vary the HBWC by incorporating a schedule of allowances that reduces the cost to the builder of certain finishes and fittings to be installed in the home. Pursuant to s 43(1) of the BS(CRA) Act the Tribunal therefore must decline to make an order with respect to this complaint item.

Whether the owner has suffered a financial loss due to the builder's breach in not achieving practical completion by 9 February 2022 and, if so, whether the Tribunal should make a HBWC remedy order that the builder pay compensation to the owner for this loss

Pursuant to s 41(2)(d)(i) of the BS(CRA) Act, the Tribunal may order the builder 'pay specified compensation for loss or damage' caused by any breach of the contract or of a provision of Part 2 of the HBC Act.
The Tribunal notes that as the HBWC does not limit the compensation the owner may claim for delay by setting a rate for liquidated damages. Therefore, if the owner is entitled to claim compensation for his losses due to a breach by the builder he is able to claim his actual losses.[27]
[27] Supra.

The owner in his opening submissions claim he has suffered financial losses due to the builder's delay in bringing the home to practical completion. The owner says his losses are:
(a)the cost of rental accommodation for him and his family because he has been unable to reside in the home;
(b)the cost of holding the building site, which consists of council rates and the water service charge;
(c)the owner's lost opportunity to fix his interest rate on 9 February 2022 at 2.48% per annum, with the result that he is now on a variable rate which is currently 6.08%; and
(d)interest on the amount of $10,000 he paid to Casvino Kitchens in December 2022, which was repaid to him on 8 November 2023, at the rate of 6% per annum.
The owner submitted that these expenses are losses that he should be compensated for by the builder, as he would not have incurred them but for the builder's breach of the HBWC.[28]
[28] Lampman and Afra Constructions Pty Ltd [2014] WASAT 27, Alison Louise Lobbe atf Lobbe Newman Trust and Kelpie Endeavours Pty Ltd atf Testa Rossa Family Trust and Quality Builders Pty Ltd [2014] WASAT 110, Byham and Afra Construction Pty Ltd [2014] WASAT 38 and Waldron and Afra Construction Pty Ltd [2013] WASAT 207.
The first issue the Tribunal must determine is whether the owner's financial losses are sufficiently connected to the builder's breach of the HBWC due to its delay in building the home. The test of remoteness for financial loss due to breach of contract is set out in the decision of the Tribunal in Alison Louise Lobbe atf Lobbe Newman Trust and Kelpie Endeavours Pty Ltd atf Testa Rossa Family Trust and Quality Builders Pty Ltd [2014] WASAT 110 at [70]:
70As set out by Justice Le Miere in Total Waste Management Pty Ltd v The City of KalgoorlieBoulder [2010] WASC 234 (2 September 2010), at [31]:
…
Loss or damage will not be recoverable if it is too remote, the tests of remoteness being those stated in what are described as the two limbs of Hadley v Baxendale (1854) 156 ER 145, 354.
For present purposes those tests can be expressed in the statement of principle formulated by Lord Reid in Koufos v C Czarnikow Ltd (The Heron II) [1969] 1 AC 350, 385 and which has been adopted in this country: see GEC Marconi Systems [938]; Baltic Shipping Co v Dillon [1993] HCA 4; (1993) 176 CLR 344, 368
The crucial question is whether, on the information available to the defendant when the contract was made, he should, or the reasonable man in his position would, have realised that such loss was sufficiently likely to result from the breach of contract to make it proper to hold that the loss flowed naturally from the breach or that loss of that kind should have been within his contemplation.
The owner submitted that he intended to reside in the home with his family once it was built. He submitted that while he waited for the home to be built that he and his family lived in the cheapest reasonable accommodation they could find, and that due to the builder's delay in completing the home they have had to stay on and continue to pay rent. The owner said that in February 2022 his weekly rent was $300 and that this increased to $350 per week in October 2023.
The builder submitted the owner has provided no evidence that he incurred any rental expense, he has provided no evidence he has paid any council rates or water service charges for the site and nor has he provided any evidence to show that he could have fixed his interest rate at 2.48% on 9 February 2022.
The builder submitted that as the owner did not provide his rental agreement or provide his bank statements showing that he has been making any payments for rent, council rates and water service charges and that he has not provided any evidence that he could have fixed his interest rate, that the Tribunal should not be satisfied that the owner has in fact incurred any of those losses.
The Tribunal accepts the builder's submission on these issues. The owner had the opportunity to provide proof of his expenses in his book of documents, but he did not do so, and he had the opportunity to give evidence or to call evidence at this hearing on the issue, but he elected not to do so. The Tribunal is therefore not satisfied that the owner has in fact incurred these expenses. There is consequently no evidence before the Tribunal that the owner has suffered the financial losses that he has claimed.
The Tribunal is therefore not satisfied that a HBWC remedy order is justified with respect to the financial losses claimed by the owner due to the builder’s breach in not bringing the home to practical completion by 9 February 2022. Pursuant to s 43(1) of the BS(CRA) Act, the Tribunal therefore must decline to make an order pursuant to either s 41(2)(d)(i) of the BS(CRA) Act with respect to the owner's claim for his rent, his site holding expense and his interest expense.
The owner also claims the builder should compensate him by paying him interest at 6% per annum on the amount of $10,000 he paid to Casvino Kitchens in December 2022, which was repaid to him on 8 November 2023. The owner says that his payment to Casvino Kitchens was made by him at the demand of the builder, and that as the demand was for a payment he was not required to make pursuant to the HBWC that he should be compensated by way of interest on the payment.
It is sufficient to repeat here that the Tribunal's power pursuant to s 41(2)(c) of the BS(CRA) Act is limited to making an order that if a specified amount is not payable to a person under the contract, that the Tribunal can order the builder to repay that amount. In any event for the reasons given above, the Tribunal has found that the owner did agree to the variation pursuant to which the owner paid Casvino Kitchens, with the consequence that this payment was a proper payment pursuant to this variation of the HBWC.

(7) Whether the owner has suffered emotional harm due to the builder's breach in not achieving practical completion by 9 February 2022 and, if so, whether the Tribunal should make a HBWC remedy order that the builder pay compensation to the owner for this emotional harm

The owner claims compensation for his 'emotional losses' and his loss of enjoyment of the home due to the builder's delay in completing the home. The owner claims damages at the rate of $30 per day for his 'emotional losses'. The owner seeks an order from the Tribunal for compensation in the amount of $18,000 for this emotional harm up to the date of the final hearing, and an order from the Tribunal that builder pay him the amount of $30 a day from the date of the final hearing until the date the builder completes the home.
The Tribunal is not satisfied, however, that the owner can be compensated for non-financial loss or damage, such as emotional harm, pursuant to s 41(2)(d)(i) of the BS(CRA) Act.[29] This is for two reasons.
[29] The Tribunal has carefully considered but respectfully does not agree with earlier decisions of this Tribunal which found that the Tribunal is able to award damages for emotional harm such as stress e.g., KBE Contracting Pty Ltd and Mawer & Anor [2007] WASAT 210 and Dumbreck and Tangent Nominees Pty Ltd [2017] WASAT 88.
Firstly, the Tribunal finds that on correct construction the scope of an order made under s 41(2)(d)(i) of the BS(CRA) Act is confined to 'loss or damage' that is 'caused by' any breach of the HBWC or of a provision of Part 2 of the HBC Act and, in the Tribunal's view, this does not extend to making an award of damages for personal injuries.[30]
[30] See also Vernon v Ashmy Pty Ltd WADC (unreported 23 January 1997, Library No BC9740021, which considered a similar (but now amended) provision: 'In my opinion, the provisions which I have referred to illustrate the fact that the Act is intended to regulate contracts between consumers and builders for the performance of certain home building work. The words "loss or damage" in s 17(4)(c)(1) must be read in the context of the Act as a whole. In my opinion, they relate to loss or damage occurring in the performance of certain home building work and do not include personal injury. This is not a case in which s 18 of the Interpretation Act 1984 (WA) should lead to a different conclusion. In my opinion, the construction which I have placed upon the section promotes the underlying purpose or object of the Act in the regulation of contracts between consumers and builders. I am, therefore, of the opinion that it is not necessary to consider whether anxiety and injured feelings form part of the appellants' compensable loss flowing from the breach of contract, since the Committee has no jurisdiction to consider such a claim'.
By its long title, the BS(CRA) Act is to provide for, among other matters, a system for dealing with complaints about building services, home building work contract matters and disciplinary matters and a system for ensuring compliance with laws about building services. As explained by the Senior Member in Deshmukh:
53In Kulowall Construction Pty Ltd v Chellem at [44] and [45], Tottle J agreed with the observation made by the Tribunal in Owners of Island Apartments Strata Plan 52597 and Pindan Pty Ltd at [57] that the BSCRA Act is at its core consumer legislation and Tottle J went on to state that the making of a complaint under the BSCRA Act is the first step in the process of resolving disputes (emphasis added).
54In my view, the purpose of the BSCRA Act as consumer legislation, in relation to complaints about disputes which arise under home building work contracts, is to provide a system and process for resolving those disputes (emphasis added).
The Tribunal finds that a provision such as s 41(2)(d)(i) of the BS(CRA) Act, which has as its object the resolution of consumer disputes due to breaches of a HBWC or of Part 2 of the HBC Act, is limited to that subject matter and its scope does not extend to making awards for personal injuries.
Secondly, it is well established in the law of contract that as a general rule there is no recovery for non-financial damage caused by breach of contract, with one of the few exceptions being where damages for disappointment and distress can recovered on the breach of a contractual term which had as its object the provision of an intangible benefit such as enjoyment, relaxation or freedom from molestation.
The Court of Appeal (WA) in Lee v Lawfirst Pty Ltd [No 2] [2023] WASCA 166 stated at [76]:
… where the claim is brought for the breach of a particular contractual provision, damages for disappointment and distress can only be recovered if 'an' object of that particular obligation was the provision of enjoyment, relaxation or freedom from molestation. It is the object of the term that is relevant. That is not to say, however, that the purpose of other provisions - as well as the contract as a whole - will not be relevant in construing the particular term in context and identifying its object.
(Footnotes omitted).
In this proceeding, the builder is in breach clause 2.2 of the HBWC. The object of this clause is to provide the owner with certainty as to the date when his home will reach practical completion. The object of the clause is not to provide the owner with 'enjoyment, relaxation or freedom from molestation'.
The Tribunal therefore finds that the owner cannot be compensated pursuant to s 41(2)(d)(i) of the BS(CRA) Act for any emotional harm, including disappointment or distress, that he may have suffered due to the breach of clause 2.2 of the HBWC by the builder.
The Tribunal therefore finds that the owner cannot be compensated pursuant to s 41(2)(d)(i) of the BS(CRA) Act for any emotional harm he might have suffered due to this breach of the HBWC by the builder. The Tribunal therefore declines to make an order with respect to this complaint item.

Costs

At the conclusion of the final hearing on 19 February 2024, the owner applied for an order from the Tribunal for his costs.
The Tribunal consequently made orders programming the filing of the owner's application for his costs, and the builder's response opposing the application. The Tribunal also ordered it would determine the application on the documents and it would fix the amount of any costs awarded in its substantive decision.
On 26 February 2024, the owner lodged his application for his costs. He claimed $783.58 consisting of the following items:
(a)Legal costs for a 45 minute consultation on 13 April 2023 with Tang Law Pty Ltd in the amount of $223.58;
(b)Legal costs for a fixed price consultation on 28 April 2023 with Lynn & Brown Lawyers in the amount of $440; and
(c) The fee charged by the Building Commissioner for lodging his building complaint on 2 May 2023 in the amount of $120.
The owner lodged with the Tribunal the invoices and proof of payment for each of these items. For this reason, the Tribunal finds that the owner did incur these costs.
The builder submitted that while it accepted the owner's consultation with Tang Law Pty Ltd related to the HBWC dispute between the parties, it did not accept the same applied to the consultation with Lynn & Brown Lawyers. This was because the Lynn & Brown Lawyers invoice did not refer to any specific reason for the consultation.
The Tribunal on this point notes the submission lodged by the owner on 26 February 2024 in which he said:
After experiencing issues with the work carried out on our house, we sought legal advice from two different law firms. We initially consulted Tang Lawyers on April 13, 2023, and subsequently sought further advice from Lynn and Brown Lawyers on April 28, 2023. Following their recommendations, we proceeded to file a complaint with the building commission on May 2, 2023.
The Tribunal observes the date of the Lynn and Brown Lawyers invoice is consistent with the chronology outlined by the owner in his submission. Accordingly, the Tribunal accepts that this invoice does relate to the HBWC dispute between the parties.
In determining the owner's application for his costs, the Tribunal accepts and applies the appliable principles as these are summarised in the decision Owners of Island Apartments Strata Plan 52597 and Pindan Pty Ltd [No 2] [2018] WASAT 2:
73The starting point in any analysis of the circumstances in which the Tribunal will make an order for costs is s 87(1) of the SAT Act, which creates the presumption of a 'no costs jurisdiction'. There is however provision in s 87 and s 88(2) of the SAT Act for the Tribunal to award costs.
74The Tribunal's jurisdiction and power in respect of costs is at all times subject to the enabling act that is the BSCRA Act.
75While s 49(2) of the BSCRA Act provides some limitation on the Building Commission making any award of the costs of a representative of a party this does not apply to the Tribunal.
76Section 49 of the BSCRA Act effectively removes the starting position that there should be no award of costs provided by s 87 of the SAT Act. However the provision should not be understood as providing that costs will generally follow the result.
77Section 49 of the BSCRA Act is neutral in effect, and should be applied in the manner which is consistent with and reinforces the objectives and procedures of the Tribunal, and any factors will be relevant which point to the justice of the case requiring an award of costs.
78Thus the effect of s 49 of the BSCRA Act means that the BSCRA Act does not affect the general position as provided in s 87 of the SAT Act.
79The Tribunal accepts the applicable principles of the Tribunal's discretion is as set out in the respondent's submissions.
80The Tribunal is at all times required to exercise its costs discretion judicially, with regard to the objectives of the Tribunal and in the interests of justice.
81The Tribunal has previously considered the factors and circumstances it might take into consideration when determining whether to depart from the starting point that is that each party should bear their own costs and to exercise its discretion to award a party some or all of its costs. They are:
a)where a party conducts itself unreasonably, particularly where the conduct leads to unnecessary costs to the other party;
b)where a party has conducted itself inappropriately, particularly where the conduct leads to unnecessary costs to the other party;
c)where credibility of evidence is at the heart of a matter;
d)where the application undermines the integrity of proceedings under the relevant Act;
e)where the case is weak, being incredible or implausible or obviously unmeritorious;
f)where a party has to embark in proceedings to vindicate its clear contractual entitlement; and
g)the circumstances of the case having regard to the above, or other, factors are such that the justice of the case supports moving away from the initial position that each party should bear their own costs.
82Whilst the above are some of the factors the Tribunal will look at and may take into account when making costs orders, the underlying consideration for the Tribunal when determining an application for a costs order will be whether the justice of the case supports moving away from the initial position that each party should bear its own costs.
83The Court of Appeal of the Supreme Court in Western Australian Planning Commission v Questdale Holdings Pty Ltd [2016] WASCA 32 (references omitted) said:
Accordingly, even in a statutory context where the presumptive position is that no costs will be ordered, generally speaking, the question is whether, in the particular circumstances of the case, it is fair and reasonable that a party should be reimbursed for the costs it incurred. The onus is on the party seeking an order in its favour.

The Tribunal considers on the basis of these principles that the following matters are relevant to the Tribunal's determination of the owner's application for his costs:
(a)the owner incurred his costs prior to commencing the proceedings, and each party represented itself from the time the owner filed his complaint with the Building Commissioner up to and including at the final hearing;
(b)the owner was partially successful and partially unsuccessful in the proceedings. The Tribunal made orders in relation to complaint items 6 and 9 but did not make orders in relation to complaint items 1 - 3, 5, 7, 8 and 10. With respect to complaint items 6 and 9, while the Tribunal did prefer the owner's ultimate submissions on those items it did not do this for the reasons advanced by the owner. Therefore, with respect to items 6 and 9, it was not the case that the builder's case was weak, incredible, implausible, or obviously unmeritorious;
(c)the builder complied with the orders of the Tribunal and it provided written submissions the Tribunal found helpful;
(d)the builder acted reasonably in that it accepted some matters alleged by the owner, and where it did not accept matters it provided reasons for not doing so; and
(e)the builder acted appropriately in that it presented its case concisely and it did not engage in unnecessary dispute. As a result, the final hearing was concluded well within the one day that was allocated to the final hearing.
The Tribunal finds for these reasons that the owner has not discharged the onus on him to show that the Tribunal should depart from the starting point that each party is to bear its own costs. The Tribunal will therefore make no order as to costs.
The Tribunal will now make the following orders.

Orders

The Tribunal orders:
Pursuant to a home building work contract the parties entered on 21 December 2020 the Tribunal, under s 43 of the Building Services (Complaint Resolution and Administration) Act 2011 (WA):

1.Declares the lock-up stage progress payment in the amount of $59,200 is not payable by the applicant and orders that by no later than 21 April 2024 the respondent must pay to the applicant the amount of $59,200.
2.Declares the price increase of $111,000 claimed by the respondent on 16 April 2023 is invalid and is not payable by the applicant pursuant to the home building work contract.
3.The application is otherwise dismissed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.
MR E Cade, MEMBER
26 MARCH 2024

142

Annexure A

Complaint Item #

Building Complaint Items referred to SAT

Orders sought by owner in its written statement

Orders proposed by builder in its response statement

Item 1:

Building works not completed within 300 days as required by the HBWC

(1) Order for immediate resumption of building works and completion within 4 to 5 months and (2) Order the builder pay compensation of $150 for each day from date of final hearing until completion of the building works, payment of difference between current interest rate and rate which could have obtained had home been completed on time, rental payments, council rates, loss of leisure and stress during that time

Will complete the home subject to agreement by the owner to reduce the building works and agreement to cap the costs of internal finishes and fittings, or for the price increase it claimed, but otherwise denies the owner are entitled to the orders sought

Item 2:

Builder has given notice that the cost of certain internal finishings is capped at a certain amount, and if the owner wants finishes and fittings above the cap that he will pay the difference.

Order to disallow the cap on certain finishes and fittings as it is a variation of the HBWC that the owner has not agreed to and orders as for item 1

Denies the owner are entitled to the orders sought / claims the owner agreed to the cap

Item 3:

Builder proposed to limit the building works the builder is to perform, with the owner being responsible for performing the balance of the works themselves

Orders as for item 1

Owner submits he has rejected this proposal. Builder agrees that owner rejected the proposal

N/A

Item 4:

Refused – not referred

N/A

N/A

Item 5:

Due to delay owner has suffered financial, mental, emotional and social loss

Orders as for item 1

As for 1

Item 6:

Owner paid builder for lock-up stage in advance of these works, and the works are still not complete

Repayment of this stage progress payment in the amount of $59,200 plus interest on this amount at 6% p/a.

Denies the owner are entitled to the orders sought - builder submits that while it did claim payment for the lock-up stage progress payment in advance of the building works being completed, that the home achieved lock-up stage by February 2023

Item 7:

Owner paid Casvino Kitchen $10,000 in December 2022, which was returned on 8 November 2023.

Order for payment of interest on this amount at 6% p/a.

Denies the owner are entitled to the orders sought

Item 8:

Owner paid builder for roof cover stage in advance of these works, and they are still not complete as roof leaks and down-pipes are not installed, cladding not installed on alfresco and timber frame is being damaged

Repayment of this stage progress payment in the amount of $48,100 plus interest on this amount at 6% p/a.

Denies the owner are entitled to the orders sought - builder submits that while it did claim payment for the roof cover stage progress payment in advance of the building works being completed, that the roof cover was installed by February 2023

Item 9:

Builder on 16 April 2023 claimed 30% / $111,000 price increase which the owner rejected

Order disallowing price increase

Submits that the notice of price increase is a valid notice, but that the builder is willing to forego the price increase and complete the home subject to agreement reduce the building works it is required to perform, but otherwise denies the owner is entitled to the orders sought

Item 10:

Compensation financial losses and emotional harm during for delay up to the date of final hearing

Order the builder pay compensation for payment of difference between current interest rate and rate which could have obtained had home been completed on time, rental payments, council rates, loss of leisure and stress up to date of hearing

Denies the owner is entitled to the orders sought

Complaint Item #	Building Complaint Items referred to SAT	Orders sought by owner in its written statement	Orders proposed by builder in its response statement
Item 1:	Building works not completed within 300 days as required by the HBWC	(1) Order for immediate resumption of building works and completion within 4 to 5 months and (2) Order the builder pay compensation of $150 for each day from date of final hearing until completion of the building works, payment of difference between current interest rate and rate which could have obtained had home been completed on time, rental payments, council rates, loss of leisure and stress during that time	Will complete the home subject to agreement by the owner to reduce the building works and agreement to cap the costs of internal finishes and fittings, or for the price increase it claimed, but otherwise denies the owner are entitled to the orders sought
Item 2:	Builder has given notice that the cost of certain internal finishings is capped at a certain amount, and if the owner wants finishes and fittings above the cap that he will pay the difference.	Order to disallow the cap on certain finishes and fittings as it is a variation of the HBWC that the owner has not agreed to and orders as for item 1	Denies the owner are entitled to the orders sought / claims the owner agreed to the cap
Item 3:	Builder proposed to limit the building works the builder is to perform, with the owner being responsible for performing the balance of the works themselves	Orders as for item 1 Owner submits he has rejected this proposal. Builder agrees that owner rejected the proposal	N/A
Item 4:	Refused – not referred	N/A	N/A
Item 5:	Due to delay owner has suffered financial, mental, emotional and social loss	Orders as for item 1	As for 1
Item 6:	Owner paid builder for lock-up stage in advance of these works, and the works are still not complete	Repayment of this stage progress payment in the amount of $59,200 plus interest on this amount at 6% p/a.	Denies the owner are entitled to the orders sought - builder submits that while it did claim payment for the lock-up stage progress payment in advance of the building works being completed, that the home achieved lock-up stage by February 2023
Item 7:	Owner paid Casvino Kitchen $10,000 in December 2022, which was returned on 8 November 2023.	Order for payment of interest on this amount at 6% p/a.	Denies the owner are entitled to the orders sought
Item 8:	Owner paid builder for roof cover stage in advance of these works, and they are still not complete as roof leaks and down-pipes are not installed, cladding not installed on alfresco and timber frame is being damaged	Repayment of this stage progress payment in the amount of $48,100 plus interest on this amount at 6% p/a.	Denies the owner are entitled to the orders sought - builder submits that while it did claim payment for the roof cover stage progress payment in advance of the building works being completed, that the roof cover was installed by February 2023
Item 9:	Builder on 16 April 2023 claimed 30% / $111,000 price increase which the owner rejected	Order disallowing price increase	Submits that the notice of price increase is a valid notice, but that the builder is willing to forego the price increase and complete the home subject to agreement reduce the building works it is required to perform, but otherwise denies the owner is entitled to the orders sought
Item 10:	Compensation financial losses and emotional harm during for delay up to the date of final hearing	Order the builder pay compensation for payment of difference between current interest rate and rate which could have obtained had home been completed on time, rental payments, council rates, loss of leisure and stress up to date of hearing	Denies the owner is entitled to the orders sought