Tutlu v Smootht Transformations Pty Ltd

[2022] QCAT 402

QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL

CITATION:

Tutlu v Smootht Transformations Pty Ltd [2022] QCAT 402

PARTIES:

fatma emel tutlu

(applicant)

v

Smootht Transformations Pty Ltd

(respondent)

APPLICATION NO/S:

BDL182-21

MATTER TYPE:

Building matters

DELIVERED ON:

5 December 2022

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Member Howe

ORDERS:

The respondent pay the applicant $1,500 within 14 days of receipt of Order.

CATCHWORDS:

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – PERFORMANCE OF WORK – REMEDIES FOR BREACH OF CONTRACT – where the parties entered into a contract for supply and installation of a roof – where the contract was not signed and was of no effect – where the owner had paid for all roofing product but not all the product was supplied – where the builder was unjustly enriched by retention of the money for the missing product

Queensland Building and Construction Commission Act 1991 (Qld), Schedule 1B, s 14

Mann v Patterson Constructions Pty Ltd [2019] HCA 32

Pavey & Matthews Pty Ltd v Paul (1987) 69 ALR 577

APPEARANCES & REPRESENTATION: This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld)

REASONS FOR DECISION

1. Ms Tutlu engaged the respondent builder to roof her new home.

2. The respondent provided a quotation to supply and install the roof. The price for the job was $23,200.

3. Ms Tutlu paid what she described as a deposit of $16,500 to the respondent up front to cover the cost of the materials.

4. The roofing materials were delivered save for what Ms Tutlu described in her application for building dispute as “the leaf guard”. The quotation listed “aluminium leaf guard” as one of the items to be supplied.

5. Only some short time after the payment of the deposit on 24 April 2021 and Ms Tutlu signing the quotation and returning it to the respondent, she raised issues about the quality of the products and the parties fell out.

6. It appears (Ms Tutlu’s evidence was far from clear about this) a contractor was engaged to install the roof.

7. Ms Tutlu commenced proceedings in the tribunal for recovery of what she says was her payment of 3,500 for the leaf guard.

8. The Tribunal made directions about the conduct of the action. Ms Tutlu responded and provided material as directed, or largely as directed, but the respondent failed to comply. Both parties were granted ample opportunity to file material and submissions but only the applicant Ms Tutlu did so.

9. The matter was listed for a determination on the papers filed.

The contract

1. By s 14 of Schedule 1B of the Queensland Building and Construction Commission Act 1991 (Qld), a level 2 regulated contract must be in a written form, dated and signed by or on behalf of each of the parties to it. A regulated contract is a domestic building contract for which the contract price is more than the regulated amount, which is $20,000. A date for the start of the work at the building site must be set out as too the date for practical completion.

2. Such a contract only has effect if it complies with those requirements.

3. The signed quotation document purports to be a level 2 regulated building contract for an amount exceeding $20,000 but does not comply with the requirements of the legislation. Accordingly it is of no effect.

4. Having said that, I accept that Ms Tutlu paid $16,500 to the respondent for the supply of roofing products, including “aluminium leaf stopper”. There is a receipt from the respondent to confirm payment.

5. I accept her evidence that all roofing products she had paid for except for “aluminium leaf stopper” have been provided. I accept the respondent builder retains payment for that product but has failed to supply it to her.

6. I find the respondent builder has been unjustly enriched at the expense of Ms Tutlu to the value of that product. Ms Tutlu is entitled to recover the money she has paid for the product.

7. The landmark High Court decision of Pavey & Matthews Pty Ltd v Paul (1987) 69 ALR 577 also concerned an unenforceable contract. There Deane J said:

   … once liability to pay reasonable remuneration is recognized as arising not from the "unenforceable contract" (which "may be referred to as evidence, but as evidence only, on the question of amount") but from the operation of law upon the circumstances, there is plainly no need to resort to the fictional promise of assumpsit to explain why the Statute of Frauds does not preclude the bringing of an action upon a common indebitatus count to recover the amount of that liability as a liquidated sum. The reason for that is that such an action is plainly not brought upon the unenforceable contract regardless of whether it is seen as an action in debt to recover the amount of that reasonable remuneration or as an action in assumpsit to recover damages for breach of the fictional assumpsit to pay that liquidated amount.[1]

   [1][10].

8. In Pavey, Mason and Wilson supported that view:

   10. Deane J., whose reasons for judgment we have had the advantage of reading, has concluded that an action on a quantum meruit, such as that brought by the appellant, rests, not on implied contract, but on a claim to restitution or one based on unjust enrichment, arising from the respondent's acceptance of the benefits accruing to the respondent from the appellant's performance of the unenforceable oral contract. …

   11. Once the true basis of the action on a quantum meruit is established, namely execution of work for which the unenforceable contract provided, and its acceptance by the defendant, it is difficult to regard the action as one by which the plaintiff seeks to enforce the oral contract. True it is that proof of the oral contract may be an indispensable element in the plaintiff's success but that is in order to show that (a) the benefits were not intended as a gift, and (b) that the defendant has not rendered the promised exchange value (Fuller and Perdue, op cit. at p.387 n.125). The purpose of proving the contract is not to enforce it but to make out another cause of action having a different foundation in law.[2]

   [2][10]-[11].

9. Then more recently in Mann v Patterson Constructions Pty Ltd [2019] HCA 32 Gageler J confirmed the availability of a debt claim in circumstances of unjust enrichment in circumstances of an unenforceable contract as follows:

   The starting point is to appreciate that the category of case is one in which it is the "very fact" that a contract becomes unenforceable that "provides the occasion for (and part of the circumstances giving rise to) the imposition by the law of the obligation to make restitution".[3]

   [3][75].

10. Here, the contract is unenforceable, but in circumstances where the respondent has been paid to supply goods but has failed to do, the law recognises an obligation on the respondent to do so which can be pursued on the basis of a debt being due.

11. The difficulty that then arises however, is establishing the debt due in respect of the missing “aluminium leaf stopper”.

12. Ms Tutlu relies upon an email from Gutter Knight Australia dated 6 July 2021 as follows:

    Hi Emelie

    …

    To do your whole house with 2 mm Powder Coated Aluminium – the investment would only be $4,224 inc GST. The number of valleys you have on your roof really adds a lot to the total metres of Gutter Guard required.

    …

    Emelie, your proposal includes:

    Cleaning all gutters and valleys of your home

    Supplying than installing 2 mm Powder Coated Aluminium Gutter Guard to the same Gutters and Valleys of your property to suit BAL 19.

13. The quotation of $4,224 including GST covers far more than cost of supply of “aluminium leaf stopper”. It is not made clear what the cost of supply only is, as opposed to supply and installation. There is no other evidence of value offered.

14. Doing the best I am able on the scant material provided, I determine that perhaps $1,500 should be attributed to the cost of supply. Installation would take some considerable time and effort I conclude, and the work to be done listed in the quotation from Gutter Knight Australia extends to covering valleys as well as gutters.

15. I find Ms Tutlu is entitled to recover the sum of $1,500 from the builder, but not the sum of $3,500 claimed, without explanation, in her application.