Taouk v Queensland Building Services Authority
[2013] QCAT 508
| CITATION: | Taouk v Queensland Building Services Authority [2013] QCAT 508 |
| PARTIES: | Mr John Taouk (Applicant) |
| v | |
| Queensland Building Services Authority (Respondent) |
| APPLICATION NUMBER: | GAR330-11 |
| MATTER TYPE: | General Administrative Review Matters |
| HEARING DATE: | 3 June 2013 |
| HEARD AT: | Brisbane |
| DECISION OF: | Michael Howe, Member |
| DELIVERED ON: | 25 September 2013 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | 1. The direction to rectify No. 36798 is set aside save with respect to item 17 the applicant is directed to rectify the falls to the eve gutters above units 8, 14, 13 and 5 so as to comply with the requirements of AS 3500.3. |
| CATCHWORDS: | Review of decision to direct rectification of defective building work - exercise of discretion – fault – termination of building contract by builder – failure to advise Authority of termination – person appropriately responsible for defective work – builder responsible for defective work whilst supervisor - – whether builder at fault or defective work attributable to builder – whether it would be unfair in the circumstances to direct builder to rectify work Queensland Building Services Authority Act 1991 ss 72, 75 R v Miller; ex parte Graham Evans & Co (Qld) Pty Ltd [1987] 2 Qd R 446 |
APPEARANCES and REPRESENTATION (if any):
| APPLICANT: | Ms CM Muir of Counsel, instructed by JHK Legal, Solicitors |
| RESPONDENT: | Ms E Roberts, Solicitor, Queensland Building Services Authority |
REASONS FOR DECISION
Background
Mr Taouk is a builder. Around January 2006 he was engaged by owner developers APJ Pty Ltd and Fadi Tarabay, to supervise the construction of 16 residential apartments in Holland Park.
Mr Taouk says he was paid a weekly wage for that work. He was overseeing the work of other contractors.
His evidence is he became concerned that the developers were cutting corners with the project. He had a number of disagreements but on 16 February 2007 he had a final disagreement with Mr Tarabay over funding of the project and he terminated his employment. He walked off site and never came back. He told Mr Tarabay to get another builder to finish the job. Mr Tarabay said he would get another builder. Mr Taouk says he had no further involvement with the project.
It remains a mystery who, if anybody, then took over responsibility as builder supervisor. On about 21 March 2007 a completed certificate of classification was lodged with the Brisbane City Council. The signature on the certificate was a forgery.
In May 2008 the true certifier, not having heard from the developers, gave notice to the Brisbane City Council and the developers that his engagement as certifier was ended.
In June 2008 the body corporate managers for the development advised the owners of the units about the fraudulent certificate of classification and then complained to the Authority about that.
Mr Taouk was interviewed by the Authority in August 2008 about the certificate. He advised then that he had left the job some two months before completion. He said he thought the developers had finished the job themselves. He denied signing the fraudulent certificate of classification.
As at October 2009 there was significant work necessary before a valid certificate of classification could issue. By December 2010 a large number of building defects had been identified.
On 16 September 2011 the Authority decided to issue a direction to rectify defective building work to Mr Taouk.
Mr Taouk has applied to the Tribunal seeking review of that decision.
A Person who Carries Out Building Work
By s 72(1) of the Queensland Building Services Authority Act 1991 (QBSA Act), if the Authority is of the opinion building work is defective or incomplete it can direct the person who carried out the building work to rectify the defective work.
Section 75(5) of the QBSA Act expands the definition of a person who carries out building work for the purposes of s 72(1) to various categories of people associated in various ways with any such project.
The Authority submits there are a number of categories under which Mr Taouk may be responsible as a person who carried out building work on the project. Firstly as a construction manager engaged under a construction management contract to provide building work services for the building work[1]; secondly as a licensed contractor whose name is stated on an insurance notification form for the building work[2]; thirdly as a licensed contractor whose licence number is stated on an insurance notification form for the building work[3].
[1] S 75(5)(f) of the QSBA Act.
[2] S 75(5)(bb) of the QSBA Act.
[3] S 75(5)(bd) of the QSBA Act.
Mr Taouk admits he was engaged as the licensed builder to oversee and manage the construction of the unit complex at Holland Park[4]. His name and his licence number and his identification as the builder are noted on the insurance notification form lodged with the Authority on 9 February 2006[5].
[4] Exhibit 1 [3].
[5] Exhibit 8 page 42.
The Builder’s Involvement
Mr Taouk admits he acted as construction manager. He said Mr Tarabay acted as project manager. The time scheduled for completion was 12 – 14 months[6]. He walked out on 16 February 2007, before completion.
[6] Exhibit 2 [10].
He has never provided a copy of his contract of employment for the project to the Authority, nor any other primary source documentation in support of his claim. He says he left everything at the office of the developers and he was not allowed back to get anything. He literally walked away from the project.
He did not advise the Authority he had terminated his management contract at the time. At all material times he was noted in the Authority’s records as the builder. He has produced a copy of a letter dated 5 March 2007 addressed to the developers confirming his termination of his involvement in the Holland park project[7].
[7] Exhibit 2 (exhibit B thereto).
Mr Luis Zamora, a plumber, gave evidence. He worked on the project from March 2006 at the invitation of Mr Taouk. He said he was aware Mr Taouk had left the project around February 2007, but he didn’t know why. He confirmed that photographs claimed by Mr Taouk to be taken when he walked off site probably do show the stage the project had reached at that time[8].
[8] Exhibit 5.
He stayed working on the project after Mr Taouk left. He said the job went downhill after that. Two other men came after Mr Taouk left the project but before the project finished. He hadn’t seen them on site before. After them, Mr Tarabay took up the reins, both construction and project management, through to near completion, although Mr Zamora left before actual finish.
Mr Charlie Taouk, the applicant’s brother, also a builder, was engaged as leading hand on the project from commencement of the project until he was terminated by Mr Tarabay around 9 February 2007. He recalls that perhaps the following week his brother told him he had also left the job.
Mr Hanna, a director of the developer company APJ Pty Ltd, gave evidence. He said on one of his infrequent visits to the site, towards the end of the project, Mr Taouk was not present. He asked Mr Tarabay about that. Mr Tarabay said he had replaced Mr Taouk with a new construction manager. Mr Hanna suspected however that Mr Tarabay was acting in that role himself.
Mr Hanna also recalled that during that visit the scaffolding had gone, as too had Mr Taouk’s advertising banner.
Mr Pratt, an officer of the Authority, gave evidence. Exhibited to his statement of evidence was an e-mail describing how he had contacted three of the tradesman who had worked on the project by telephone[9]. One of those tradesmen was Mr Zamora, the plumber. Another was a tiler. Mr Pratt’s evidence was that all three had said the same thing, namely that Mr Taouk left the job and the job continued under someone else.
[9] Exhibit 8 page 77.
In cross-examination Mr Pratt added that the three tradesmen seemed honest and open but not forthcoming, probably because the job was such a long time ago, he was an authority figure and additionally, they had heavy accents. Strangely enough Mr Zamora gave evidence by telephone during the Tribunal hearing and seemed to me to speak with a clear Australian accent. He was not hard to understand.
Mr Klemm, a building inspector with the Authority, also gave evidence. Mr Klemm did not believe Mr Taouk’s claim that he was not the builder to completion.
The basis of that belief seemed to be twofold. First, Mr Taouk failed to give notice to the Authority that he was leaving the job when he left the job. Second, Mr Taouk has not produced any documentation to support his position.
Mr Klemm agreed in cross-examination that there was no Authority policy that he was aware of requiring a builder to give notice to the Authority on termination of a building contract.
In my opinion the evidence in support of Mr Taouk’s position is compelling and substantial, though based in large part on oral testimony. As with Mr Pratt, I found Mr Zamora a truthful witness. He had nothing to gain by lying. I also found Mr Taouk’s evidence convincing. I took him to be a truthful witness. All the evidence of the tradesmen was consistent. Mr Pratt’s evidence was that all the tradesmen he spoke to supported Mr Taouk’s position.
I conclude and find that Mr Taouk left the project as supervising builder on 16 February 2007, and thereafter other parties completed the building work through to end of construction.
A Discretion to Issue a Direction to Rectify
Section 72(1) confers a discretion on the Authority. It may or may not issue a direction to rectify. The discretion is reinforced by the express provision in s 72(14) permitting the Authority not to be required to give a direction under s 72(1) if the Authority is satisfied that, in the circumstances, it would be unfair to do so[10].
[10]R v Miller; ex parte Graham Evans & Co (Qld) Pty Ltd [1987] 2 Qd R 446; QBSA v O’Brien & Ors [2002] QDC 329 [5].
Mr Taouk’s case is necessarily that it was unreasonable for the Authority to issue the direction to rectify to him.
In exercising the discretion in s 72(1) the personal responsibility of the builder for the defective work is a relevant factor for consideration. If, under the expanded definition in s 72(5), there is more than one person possibly responsible, after the threshold determination that there is defective building work, the next task must be to identify which of those potential recipients of a direction to rectify is the most appropriate recipient or recipients[11]. Fault then becomes an important determinant in that task.
[11]By s 72(5AA) a direction to rectify may be given to more than one person for the same building work.
The leading authority on this is R v His Honour Judge Miller where Derrington J said:
That a builder’s work comes within the definition of building work that is faulty or unsatisfactory within the meaning of subs. (3) does not of itself impose any liability upon him but merely enlivens the discretion of the Board to order him to remedy the work, for the use of the permissive “may” in the investment of the Board’s powers also vests such a discretion in the Board .… the Board, in exercising that discretion properly, must in a proper case recognise the builder’s innocent position and afford him protection by the exercise of its discretion in his favour …. Such a discretion is both reasonable and logical in this field where it is so difficult to set precise criteria, and where a number of different factors will operate in varying degrees.[12]
[12]Op cit at 458.
In QBSA v O’Brien & Ors, McGill DCJ discussed in part the reference there to other factors. He said, affirming the leading authority of His Honour Justice Derrington’s statement:
… It is necessary to decide whether it is appropriate that the particular defective or incomplete work be rectified, and if so by whom it should be rectified. To some extent these considerations are inter-related. If for example it was particularly important that a defect be rectified, for reasons which went beyond the interest of the building owner and involved considerations of public safety, and the person responsible for the dangerous state of the works was for some reason not available as a recipient of a direction, it might be a case of finding somebody who would be able to rectify the work and who had some personal responsibility for it. Perhaps in an extreme case a direction could be issued to someone who had no personal responsibility for the defect, but was within reach of the section.[13]
[13] Op cit at [49].
This clarifies the circumstances where a person may be held responsible for defective building work in the absence of fault. It may be appropriate to hold different people responsible for different parts of defective building work[14]. A person who has no personal responsibility for defective building work should be held responsible for the work only in circumstances of extremity, such as where issues of public safety are concerned.
[14] De Luchi v QBSA [2002] QBT 66 at [35(f)].
In my opinion what these authorities make clear is that an appropriate exercise of discretion must involve more than lip service as to recognition of a builder’s innocent position in the scheme of things. What should follow that recognition, in the absence of other relevant factors, is a decision not to issue a direction to rectify. Similarly, there may be circumstances, for example where issues of public safety are concerned, where that innocence cannot preclude the issue of a direction to rectify. Accordingly an appropriate exercise of discretion should not be limited to an examination of fault alone, but the innocence of a builder for the defective work must be accorded appropriate weight.
There is no suggestion in the matter before me that there is an issue concerning public safety.
I also consider there is an element of response to injustice in this matter before me. One must generally feel sympathy for the people who bought from the developers. If the complainant to the Authority had been the owners, rather than the innocent third party buyers, I suspect the attitude of the Authority would have been different. There is also the disturbing matter of the fraudulent certificate of classification to muddy the waters. The Authority, however, does not represent aggrieved homeowners[15].
[15] Ibid at [36].
‘In a legal sense, the Direction is not given solely for the benefit of the individual owner, but rather to discharge the Authority's responsibilities under the Act, to ensure proper standards in the industry and rectification of building work. Nevertheless, in practice, the homeowner and the Authority are often aligned in proceedings before the Tribunal.[16]’
[16] Garbutt-Cuttiford v QBSA [1999] QBT 80.
In QBSA v O’Brien & Ors it was accepted that a licenced builder who had made an arrangement with an unlicensed builder to allow his licence to be used for the purposes of the statutory warranty scheme was a person who fell within the extended definition of a person who carried out building work in s 72(5) and was therefore subject to a direction of the Authority pursuant to s 72(1). This was so even though the licensed builder did not do any of the defective building work[17]. However in that matter there was a range of potential candidates available to whom a direction to rectify might be given. His Honour concluded there were two other people other than the person who was actually given the direction to rectify more appropriately personally responsible for the work[18]. Accordingly the licensed builder should not have received a direction to rectify.
[17] at [4].
[18] Op cit at [52].
In that matter the developer company was considered the obvious recipient of a direction to rectify, save it was insolvent. There were other solvent parties however to whom a direction to rectify could appropriately and fairly be given. Would the decision of the Court have been different if there had not been other appropriate solvent parties?
I have concluded that Mr Taouk was not the builder to completion. It seems clear to me that the most appropriate parties to have been directed to rectify the defective work on this project were at all times the developers, APJ Pty Ltd and Fadi Tarabay.
Apparently Mr Tarabay cannot be located. Mr Taouk thinks he has left the country. Mr Hanna told him that. It is unclear what enquiries have been made to confirm that.
APJ Pty Ltd is deregistered and therefore the assumption is that it has no assets. Deregistration of course is not the same as insolvency. A deregistered company may be reinstated. I have no information as to whether ASIC holds any property on the part of that deregistered company.
Given neither of these appropriate parties are readily amenable to a direction to rectify, should a direction to rectify be given to Mr Taouk, as it were, by default? I have no evidence before me concerning Mr Taouk’s financial circumstances. There is no suggestion he has “deep pockets[19]”.
[19] QBSA v O’Brien & Ors at [51].
The case of the Authority is based on the proposition Mr Taouk was the builder for the entire project through to completion. I have concluded that was not the case.
In cross-examination Mr Klemm agreed that if the builder had left the job and had no control over work done after that, it would be unreasonable to hold him responsible for the work done after he left the job. It was not clear whether that statement was an opinion as to the appropriate exercise of the discretion in s 72(1) or an expression of Mr Klemm’s sense of fair play.
In my opinion the appropriate exercise of discretion in circumstances where I have found Mr Taouk left as builder supervisor for the project on 16 February 2007, is to conclude that it is unfair to hold Mr Taouk responsible for defective work arising out of construction which occurred at the site after that date. There are no relevant compelling circumstances mitigating against such conclusion.
It is not appropriate that Mr Taouk be responsible in default of other parties more appropriately responsible to rectify defective building work being amenable to direction.
What is appropriate is that Mr Taouk be responsible to rectify defects in building work occurring during his oversight of the project[20].
[20]Garbutt-Cuttiford v QBSA: “Section 4 of the Act defines "defective work", as including work that is "faulty or unsatisfactory". The phrase does not generally apply to the whole of the works, but to the particular piece of allegedly defective work.”
The Directions to Rectify
Mr Taouk’s evidence is that he took photographs of the Holland Park site the day he walked off[21]. He says they show the stage the project had reached when he left. The frame was standing and the roof was on, but no windows or doors had been installed and the scaffolding was still up. The units were ready for internal linings[22]. Generally, Mr Taouk described the work remaining to be done as at 16 February 2007 as substantial[23], not minor as at one stage he advised the Authority.
[21] Exhibit 5.
[22] Exhibit 2 [14] – [15].
[23] Exhibit 2 [17(f)].
There are 17 directions to rectify[24]. Of these, Mr Taouk says 14 items concern work done after he left the job. Mr Taouk’s evidence as to the stage reached in the project as at 16 February 2007 was not really challenged by the Authority given the Authority did not accept Mr Taouk left the job before completion.
[24]The Authority’s guideline policy provides that in deciding whether to give a direction for rectification a relevant circumstance may be delay on the part of an owner notifying the Authority of a defect. Some defects in this matter appear to have been noticed by the owners of the units well before complaint was made to the Authority on 13 December 2010. Such items of complaint (eg balustrades) appear to be outside the policy guidelines as regards delay.
Of the aforementioned 14 directions, all appear to me to be related to building work usually completed towards the end of typical constructions. That is the evidence of Mr Taouk. The photographs taken by Mr Taouk supports that stand. I accept that was the case.
There were three items of complaint that appeared to be associated with work done during the period of Mr Taouk’s supervision however. They concern construction of stairs in the complex, damage to a storm water drain and gutter falls and downpipe spacing.
Stairs
The direction to rectify item 9 states that
the stairs throughout the complex do not comply with the Building Code of Australia 2006 Volume 1 Part D.2.13 Goings and Risers, in accordance with table D2.13; and comply with Table D2.132 R + G = Max 700 and Min 550, with the goings and risers being consistent throughout in one flight.
Mr Taouk admits it was during his tenure as supervisor that most of the concrete stairways were formed. He says the external stairs had not been constructed when he left. I understand his evidence to be that the stairs outside the building proper were done with the landscaping.
Mr Taouk says it is common practice to rectify such “issues” complained of at the tiling stage of the project. He left the project before the tiling work was done. He thinks the problem is the tiles were laid on the concrete formwork without correction of the concrete substrate. The substrate should have been fixed before the tiles were laid. He disputes responsibility for rectification.
He gave evidence that he noticed at the formwork stage that the stairs did not comply with the Building Code, but he intended when the tiling work stage was reached to have the formwork contractor rectify the problem. If the contractor failed to do so the correction work would have been done by the tiler or some other contractor and that cost recovered from the formwork operator.
Mr Klemm for the Authority did not dispute Mr Taouk’s evidence that this was one way of doing the job. He did question the effectiveness of that course. He thought an efficient builder would not wait until reaching the tiling stage. It was not best practice.
In my opinion in such circumstances it is the responsibility of both the builder and the tiler to ensure an adequate and suitable substrate exists before tiling work is done. If the tiler finds the concrete substrate unsuitable he has an obligation to draw the attention of the builder to that. If the tiler does not, then the tiler assumes responsibility for any defective tiling work thereafter. If the tiler brings the attention of the builder to the condition of the substrate, and the builder does nothing but instructs the tiler to proceed in any case, the responsibility for the standard of the tiling work thereafter lies with the builder[25].
[25] Parry & Anor v Ewart [2000] QDC 54.
In either case, the responsibility for defective stairs in the Holland Park complex should lie with the builder responsible at the time of tiling, or the tiler. I conclude Mr Taouk’s approach to the matter did not result in the defective building work the subject of the complaint. Best practice and defective building work are not the same thing.
Defective building work occurred when the tiling was done. Accordingly I conclude it is unfair to require him to rectify that item of complaint.
Storm Water Drain
There is a direction to rectify a crushed storm water drain. The drain is crushed in two locations. The Authority asserts no vehicle has accessed the area since construction.
Given my finding that Mr Taouk did leave the job on 16 February 2007, and given the project continued, it is, on balance, more probably the case than not that the damage occurred in the months following, and most probably during the final clean up and landscaping part of the work, if not even after that.
Mr Zamora was a plumber onsite throughout the project. His evidence is that he does not recall a crushed pipe.
I conclude the damage most probably occurred after Mr Taouk left the job. In the circumstances it is unfair to hold him responsible for rectification.
Gutters and Downpipes
Mr Taouk stated in evidence before the Tribunal he was there when the guttering was done and the downpipe droppers cut in.
With respect to the spacing of the downpipes, he said he followed the hydraulic consultant’s plan. Mr Zamora opined that that would most probably have been the case.
The Authority says the downpipes do not comply with AS3500.3. The complaint is that the downpipes are not spaced evenly to achieve optimum performance.
The defect is referred to in the statement of reasons for decision[26] as having been observed by the specialist contractor engaged by the Authority, Tennant Roofing. But the report from Tennant Roofing[27] says no such thing. All it says is “the placement of some (down pipes) is not optimum but rather where possible within design constrictions.” Mr Isenhardt, the author of the report, said in cross-examination he did not know if AS 3500.3 had been breached. The reference to AS3500.3 is not supported by Mr Isenhardt.
[26] Exhibit 6 p 23.
[27] Exhibit 10 (exhibit DI-4 thereto).
Mr Taouk says he placed the downpipes in accordance with the hydraulics plan. I see no reason on the material before me to disbelieve him and there is no persuasive evidence to the contrary to justify a conclusion the design of the downpipes is outside standard. The evidence on this is simply too vague.
In respect of the fall of the gutters however, Mr Isenhardt was clear both in his report and his evidence in cross-examination that the fall of the gutters is wrong in many places. The gutters flow the wrong way. That is regardless of leaf and debris build up.
It was put to Mr Theslow, a plumber called for the Authority, that water pressure from the crushed stormwater drains could have caused the downpipes to be pushed back up into the gutters. The suggestion was that this may have caused the error with the fall of the gutters. Mr Theslow thought that was not possible.
I accept Mr Theslow’s opinion. I conclude the fall of the gutters is defective, the defect most probably occurred during installation and installation occurred during the supervision of construction by Mr Taouk. Accordingly Mr Taouk should be responsible for remediation of the problem.
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