Townsville Constructions Pty Ltd v Williams

CITATION: Townsville Constructions Pty Ltd v Williams and Williams [2011] QCAT 166

PARTIES:	Townsville Constructions Pty Ltd
v
Mr Edward John Williams and Mrs Vicki Williams

APPLICATION NUMBER:   BDL142-10

MATTER TYPE: Building matters

HEARING DATE: 10 and 11 March 2011

HEARD AT: Townsville

DECISION OF: Mr John Carey, Presiding Member
Ms Joanne Browne, Member

DELIVERED ON: 27 April 2011

DELIVERED AT: Townsville

ORDERS MADE:      1.    The respondents pay the applicant the amount of $115,405.29 by 4.00pm on 25 May 2011.

CATCHWORDS: 

Contracted services plus reasonable profit – whether unfair to the building owner to make an award – dispute as to builder’s margin, delivery of materials to site, hours charged for labour – whether contract is unenforceable for failure to comply with section 55(1)

Domestic Building Contracts Act 2000, s 55

APPEARANCES and REPRESENTATION (if any):

APPLICANT:	Mr A J Hockings instructed by Roberts Nehmer McKee Lawyers
RESPONDENT:	Mr A W Collins instructed by Connolly Suthers Lawyers

REASONS FOR DECISION

Introduction

1. Mr Edward Noel Horscroft, a director of Townsville Constructions Pty Ltd, was well known to Mr and Mrs Williams.  Mr Horscroft and Mrs Williams in her capacity as Mactrac Pty Ltd had completed eleven (11) separate construction projects together.  Mr Horscroft was in the course of completing the construction of a house at 51 Yarrawonga Drive, Townsville (“the site”) which would become the principal place of residence for Mr and Mrs Williams when this dispute arose.  The essence of the dispute was whether Mr and Mrs Williams had been overcharged for labour (time taken for lunch breaks), whether materials claimed by Mr Horscroft to have been delivered to site were in fact delivered to site and the application of a builders margin (at 15%).  Other issues relating to GST were resolved at the hearing.

2. Prior to construction of Mr and Mrs Williams house described by Mr Horscroft as a “luxurious mansion”, a written Master Builders Australia contract was signed and dated 22 September 2008 (“the contract”).[1] The contract was a cost plus contract and for the purposes of section 55(1) of the Domestic Building Contracts Act 2000 (“DBCA”). Mr Horscroft argues that due to the difficult site location (Castle Hill) the cost of the construction could not be reasonably calculated at the time of entering into the contract.

   [1]See exhibit 15 (attachment).

3. The Application filed on 7 May 2010 seeks an order for payment of an amount owing by Mr and Mrs Williams in the sum of $191,156.38 under section 55(4) of the DBCA. At the hearing and in final written submissions a number of concessions were made by Mr Horscroft which narrowed the issues in dispute. These concessions included the cost per hour for foreman/labourer was inclusive of GST, some materials claimed by Mr Horscroft were deducted and the builder’s margin of 15% was to be applied on GST exclusive amounts. The amount now claimed by Townsville Constructions Pty Ltd is $159,267.82 calculated as follows:[2]

   Value of Contracted Services  $ 2,580,999.69
   

   [2]See Application filed…