UNGVARY and GEMMILL HOMES PTY LTD - [2018] WASAT 124

JURISDICTION     :   STATE ADMINISTRATIVE TRIBUNAL
ACT: BUILDING SERVICES (COMPLAINT RESOLUTION AND ADMINISTRATION) ACT 2011 (WA)
CITATION:   UNGVARY and GEMMILL HOMES PTY LTD [2018] WASAT 124
MEMBER:   MS H LESLIE (MEMBER)
MR R AFFLECK (SENIOR SESSIONAL MEMBER)

HEARD:   21 SEPTEMBER 2018
DELIVERED          :   12 NOVEMBER 2018
FILE NO/S:   CC 480 of 2018
BETWEEN:   JOHN UNGVARY
DANIELLE HUGO
Applicants
AND
GEMMILL HOMES PTY LTD
Respondent

Catchwords:

Building service - Excavation earthworks - Faulty and defective workmanship - Proper and proficient - Collapsing sand bank

Legislation:

Building Services (Complaint Resolution and Administration) Act 2011 (WA), s 5, s 5(1), s 11, s 36(1)(C)

Result:

Application partially successful

Category: B

Representation:

Counsel:

Applicants	:	In Person
Respondent	:	Mr P Monaco

Solicitors:

Applicants	:	N/A
Respondent	:	GV Lawyers

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

Nil

REASONS FOR DECISION OF THE TRIBUNAL:

The application

The matter before the Tribunal is a workmanship complaint referred from the Building Commission under s 11 of the Building Services (Complaint Resolution and Administration) Act 2011 (WA) (the Act). It is a dispute in relation to site earthworks on the applicants' property at Lot 13 Orissa Place, Two Rocks, Western Australia (the property). At the time of the events complained of, the property was a vacant property upon which the respondent had been contracted by the applicants to construct a house on the front righthand side of the property (as faced from the street). The natural ground level of the property sloped quite steeply from left to right. The pre-excavation survey shows a drop from a 14 metre contour to an 8.5 metre contour from the north-west side of the property (described by the applicants as the 'north' side) to the southeast side (described by the applicants as the 'south' side). The complaint is essentially about excessive excavation of sand from the left-hand side of the property in May 2014, and the removal of the excavated sand.
The dispute between the parties arose immediately following the performance of the excavation (the cut) by the respondent's contractor on 15 May 2014. The applicants claim that the cut was excessive. Discussions followed including as to the alleged need to construct a limestone block retaining wall costing some $30,000 to support the cut. In the meantime, the slab for the construction of the applicants' house was laid.
There was then a delay of about six months. Then further work by the respondent began in January 2015 and the house reached practical completion at the end of 2015.
As at the time of the hearing on 3 August 2018, the cut was much degraded by erosion and the issue about responsibility for the alleged excessive cut and the costs of retaining and backfilling the site remained unresolved.

The issue

The complaint was made under s 5(1) of the Act alleging that a building service, namely the excavation work, was not carried out in a proper and proficient manner or was faulty and unsatisfactory. That is the central issue for the Tribunal.

The hearing

The hearing took place over two days namely 3 August and 21 September 2018.
The Tribunal had the benefit of the book of documents, Exhibit A which included all of the documents on the Building Commission's file plus a number of subsequent reports from experts relied on by the parties. Mr Rocky Vasile, an engineer, gave evidence for the applicants as did another engineer Mr Gervase Purich, for the respondent. In addition, Mr Mark Viska, a building surveyor, gave evidence for the applicants. The two applicants gave evidence as did the respondent's group building manager Mr Dominic Morolla. A number of other documents were added into the evidence during the course of the hearing being Exhibits B to G. At the conclusion of the hearing, the Tribunal reserved its decision.

The legal framework

This matter is not complex legally. Work contracted under a building contract is required to be done to an acceptable standard. The question for the Tribunal is whether or not in this instance, in all the circumstances, the requisite standard has been complied with by the builder in the performance of the excavation work by its subcontractor.

The contractual and complaint history

A number of variations were undertaken during the course of the negotiation of the contractual terms between the parties, and these require examination.
The original contract document dated 23 July 2013 relevantly provides the following:
1)Clause 2.1 under the heading 'demolition' required the applicants to provide 'a cleared, levelled, sandy site ready for builder' to construct the house.
2)Clause 4, under the heading 'earthworks', required the builder 'to provide approximate sand pad level including compaction certificate'. A final floor level of 10.15 metres is noted and it is recorded that 'no allowance made to remove trees or stumps, client to organise prior to commencement of works on site'.
3)Clause 6 under the heading 'retaining walls' excludes from the contract any boundary retaining wall. No reference is made to any other retaining wall. It is to be noted that, at that stage, a boundary retaining wall on the right-hand side boundary was anticipated.
In November 2013, the applicants did some clearing and earthworks on the property. Given the nature of the works done and the alleged alteration in levels, the respondent required the property to be resurveyed and this was done.
On 4 February 2014, variation 7439 was prepared allowing for a change in the final floor level of the house from 10.15 metres to 9 metres. It is undisputed that this would require some level of retaining on the left-hand side of the house. The variation provided for that retaining to be done by the applicants after handover (that is, following completion of the house). The variation document, which was in evidence, provided as follows:
Client to provide retaining walls as per plan after handover due to change in FFL to 9.00
It is to be noted that the variation although dated 4 February 2014 was not signed by the parties until 13 March 2014. It was signed by the first named applicant on behalf of the applicants. There is a dispute as to the significance of the words 'as per plan'. The significance of this is that the respondent says is that its actions in relation to the performance of the cut reflected a particular understanding by its representatives as to the retaining proposed by the applicants following handover.
On 11 April 2014, the respondent informed the applicants in an email that advice had been received from the respondent's slab start coordinator that some tree roots and further vegetation needed to be removed as they were 'right on the slab line'. On 16 April 2017, the respondent raised a quotation for $3,617 and a variation (number 7867), was presented to the applicants. That variation document, which was in evidence, provided as follows:
Earthworks excavator to cut left-hand side bank and to pull out stumps. Tree Lopper to trim right hand boundary.
The variation signed by the second named applicant on behalf of the applicants was dated 30 April 2014.
The applicants' position is that up until this time there had been no discussion about the need to excavate to any great extent on the lefthand side of the property. Their position is that, in designing the construction, they had positioned the house in the front right-hand corner 'to keep the slope on the north side on its natural state, to protect it from disturbance and minimise alterations to the embankment'. It is noted that the original site survey described the site conditions at the time of inspection as 'sloping and covered with virgin bush'.
The respondent's position is that, following the level changes caused by the applicants' clearing works, given the dropping of the floor level of the house at their request in order to avoid the need to retain on the right-hand boundary, and given the February 2014 discussions about the retaining to be done on the left-hand side of the house (as further detailed later herein), the applicants were, or should have been, well aware by logic and simple observation that sizeable excavation on the left-hand side of the house would be required.
The earthmoving contractor performed the cut as detailed later in these reasons on 15 May 2014. No erosion control measures were implemented. Following a site meeting on 23 May 2014 attended by the second named applicant, the respondent requested that the applicants bring forward the construction of the retaining wall, and recommended that a limestone retaining wall be built by the applicants before the slab was poured rather than the construction work proceeding with the respondent attending to the retaining required after handover and by the installation of a panel and post style retaining wall. The respondent claimed that the embankment as cut was at risk of degrading (because of the nature of the soil), resulting in sand slippage and was at risk of presenting a risk to the neighbouring property. The respondent further claimed that it would be much more difficult for the applicants to do the retaining after the construction of the house, and that to do so prior to construction would be much easier for them. The applicants claimed that any risk was due to over-excavation by the respondent and refused to alter the arrangements regarding retaining, claiming that any issue was for the respondent to resolve.
The respondent laid the slab but, on 27 June 2014, stopped work on the site due to safety concerns given the state of the excavated embankment and the dispute regarding retaining the area. There was no progress for six months, there being an apparent stalemate about the retaining issue. Some further collapse/erosion of the cut appears to have occurred during that time.
In January 2015, the respondent resumed building on the site.
On 11 November 2015, the applicants sent a notice of proposed complaint for unsatisfactory building service to the respondent. The complaint items were over excavation and removal of sand without permission. The remedy sought was that the builder provide a retaining wall and backfill after retaining. The matter was not resolved and on 16 March 2017, a complaint was lodged with the Building Commission. A proposed remedy order was issued by the Building Commission, however, the respondent opposed the terms. In November 2017 a revised proposed remedy order was put forward by the Building Commission. Both parties disagreed with the terms. The matter was therefore referred to the Tribunal.

Obligation to retain

There is no dispute that, prior to the cut occurring, the applicants were responsible for any retaining that was required on the left-hand side of the house and it was agreed that this should occur after handover. An analysis of the various iterations of the site plan show the development of the thinking of the parties, particularly in relation to retaining on the site. For convenience those documents are in Exhibit G.
Site plan Revision A dated 27 June 2013 shows the original intention that, aiming for a finished floor level of 10.15 metres, the builder would retain the right-hand boundary of the property using a panel and post form of retaining wall with the top of the wall at 10.05 metres. This site plan shows no paved area on the right-hand side of the rear portion of the property.
Site plan Revision C dated 23 August 2013 shows those same things.
Site plan Revision E dated 2 September 2013 continues to show a finished floor level of 10.15 metres but shows that the proposed retaining on the right-hand boundary still be to 10.05 metres but that it be done by the applicants 'prior to construction to the builders schedule'. Revision E also shows the inclusion of a rectangular paved area on the right-hand side of the rear portion of the property (designated 1c, that is, just below floor level) and, accordingly, a shift to the left of the 10 metre designated retaining line (RL), given that a wider flat space needed to be provided for the paved area. Cost was said to have driven this change. Variation 6553 signed 20 August 2013 shows the reduction of the contract price to reflect the applicants' assumption of this cost.
A further change, following the reshaping of the property by the applicants upon clearing it, is shown in the next site plan. Site plan Revision F dated 28 November 2013 shows the lowering of the finished floor level from 10.15 metres to 9 metres, the deletion of the right-hand boundary retaining wall but, in its place, the provision of a section of retaining wall on the left-hand side of the front of the house adjacent to the garage. This wall is described on the plan as 'proposed panel & post retaining by owner prior to construction to builders schedule top of wall @ 10.00', indicating a modest retaining wall of 1 metre aboveground in height from just in front of the garage and extending a little behind it, alongside part of the paved area. The paving remains at -1c and the RL is noted to have dropped to 8.828 metres.
Site plan Revision G dated 13 December 2013 then shows a design change in the method of retaining on the left-hand side of the garage. The panel and post wall proposed in Revision F has been deleted and in its place, rather than a separate retaining wall, the lefthand wall of the garage is to be constructed as a reinforced concrete-filled brick retaining wall. Variation 7275 dated 13 December 2013 (although not signed until signed 13 March 2014) shows an addition to the contract reflecting this work to be done by the builder. It is noted that the RL remains at 8.828 metres and that the RL has been realigned to meet the bottom of the reinforced garage wall along its full length.
Site plan Revision H dated 28 December 2013 shows those same things.
Site plan Revision I dated 10 February 2014 (Site Plan I) then shows the floor level paving and reinforced concrete garage wall as previously but further shows an additional angled panel and post retaining wall to be constructed parallel to the back section of the house and running adjacent to the left-hand side of the paved area from level with the rear of the garage to level with the rear of the house and then angling away to the right into the rear garden. That wall is labelled 'panel and post retaining by owner after handover' and shows measurements for the top of the retaining and the bottom of the retaining varying from 2 metres at the front end of the wall to over 3.38 metres at the angle point and dropping to 1.68 metres at the rear end of the wall. The respondent's case is that Site Plan I was sent to the applicants by email on 10 February 2014 and that it is the 'plan' to which variation 7439 of 4 February refers in the statement 'client to provide retaining walls as per plan after handover'.
The upshot of these contractual variations is that, other than to the extent that the garage wall was being reinforced, the respondent was not responsible under the contract for the construction of any retaining walls.

Obligation to excavate

As noted above, the original contract documents obligated the respondent 'to provide approximate sand pad level including compaction certificate'. A final floor level of 10.15 metres is noted and it is recorded that 'no allowance made to remove trees or stumps, client to organise prior to commencement of works on site'.
No other provision for earthworks is contained in the contractual documents other than as contained in variation 7867 signed on 30 April 2014. As referred to earlier, that variation document, provided that, at a cost of $3,617, the respondent would provide the following building service, namely:
Earthworks excavator to cut left-hand side bank and to pull out stumps. Tree Lopper to trim right-hand boundary.

The applicants' argument

The applicants dispute that they ever received Site Plan I. Their case is that they did not anticipate a cut of any significance on the lefthand side of the house by the respondent. They claim to have understood that the 'cut' to the 'lefthand side bank' referred to in the variation 7867 was to be a modest alteration to the level adjacent to the garage in the context of the plan to reinforce the garage wall as the method of retaining (as per Variation 7275 and Site Plan G), and in the context of the removal of some underground stumps alleged to have been located along the slab line. Any excavations that may have been needed for the retaining work that they were to do subsequently under Variation 7439 they say were their responsibility. They say that the clear understanding was that the retaining would be done after handover. They appear to say that their expectation was that the respondent would progress the construction of the house doing only the excavation work proposed under the original contract (to secure a level sand pad) along with the modest alteration referred to above.

The respondent's argument

The respondent claims that the applicants received and implicitly endorsed the retaining plan that appears on Site Plan I and that the respondent made arrangements for the cutting of the left bank of the property taking into account the requirements for the slab and the working platform that would be needed by the applicants and/or contractors that they might use to construct the retaining wall after handover. The respondent claims that, in the context of Site Plan I and Variation 7439, and in the context of the work quoted and agreed in Variation 7867, it was a proper and proficient execution by them of the earthworks required to be performed by them, that the cut take account of the house pad requirements plus the future retaining work.

Evidence

Site Plan I

Mr Morolla, on behalf of the respondent, gave evidence that on 10 February 2014, the respondent's employee a Mr Bousfield emailed the first named applicant at his email address attaching four documents. The email identifies the attached documents only as 'outstanding paperwork' requiring signature. Mr Morolla's evidence is that the respondent's electronic record shows that these four documents were scanned and attached as one attachment, the PDF scanning reference for which appears on the face of the email. The email and attached documents are in evidence. The attached documents are an unsigned copy of Variation 7439 prepared six days before, a copy of Site Plan I revised on that day, that is 10 February, a copy of Variation 7275 prepared 13 Dec 2013 but still unsigned and a copy of a contract addendum 1714 still unsigned. All documents were highlighted in the relevant places for signature/initialling.
Mr Bousfield no longer works for the respondent and was unavailable to give evidence. Mr Morolla was not an employee of the respondent at the relevant time but from his knowledge of the matter gleaned since working for the company since and from his consideration of the records, his evidence is as follows.
Although showing the RL, Site Plans A to E do not show the site contours. Site Plans F, G and H do show the site contours and, in particular, show the 10 metre, 10.5 metre and 11 metre contour lines inappropriately crossing the northern corner of the intended paved alfresco area which was required to be flat and level. Mr Morolla's explanation for Site Plan I is that this error was picked up at some point prior to 10 February 2014 by the respondent's staff, and that it was realised that given the level difference between the highest contour and the RL, (a difference of over 2 metres), the sloping ground would need to be cut back and retained (in order to hold back the excavated face of the slope) to allow for the level paved alfresco area contracted for.
His evidence is that the likely course of events was that Mr Bousfield or other company representatives discussed the retaining needed on the lefthand side of the house with the applicants, and, once agreement had been reached as to what the applicants would do when they did the retaining after handover, he then had variation 7439 drawn up and a further site plan (Site Plan I) as referenced in the variation drawn up to reflect those discussions. Site Plan I refers on its face in the column adjacent to its date to Variation 7439.

The applicants maintained in their evidence that they only expected a modest change in levels at the front of the property as a result of Variation 7867. They claimed that they had not seen Site Plan I until the exchange of documents in these proceedings.
Notwithstanding their argument, the first named applicant conceded in his evidence that he had in fact received Site Plan I electronically. When being asked about a follow-up email he claimed to have received after he had returned the two signed variations, seeking from him the signed copy of the site plan, he stated that he went back to his records and 'realised that the reason I didn't sign the plan was because it had a 3 m high wall on it. It was meant to be 1.5 m'. That statement contains within it a concession that he did in fact receive the plan electronically at an earlier point. Thereafter he continued to emphasize that he had not signed the plan. It is noted that the email he referred to was not produced.
The applicants also appeared to concede that they would be required to do some retaining after handover in the form of panel and post retaining but at not more than 1.5 metres. They refused to be drawn more precisely on what was proposed after handover, insisting that that was to have been decided by them after handover. They concede that there was no plan drawn for any other type of retaining other than that appearing on Site Plan I.
Further, the applicants state in the part of their submission entitled 'Facts of the Case' at Item 8 that on the same date as Variation 7439, 'we agreed to provide a panel and post (1.5 m high) [retaining wall] after handover due to the change in FFL from 10.15 to 9.0 (Variation 7439 and Site Plan 2)'. It is to be noted that all of the site plans referred to are titled 'Site Plan 2' and are variously designated with their revision number under this title.

Consideration

The applicants clearly received both variations as they were both ultimately signed and returned to the respondent albeit not until 13 April 2014. Both are in evidence. No signed copy of the plan is in evidence. The applicants appear to still dispute that they received Site Plan I. The Tribunal does not accept that evidence. The first named applicant conceded as much. The Tribunal considers that the evidence of Mr Morolla as to what likely occurred in and around the time of the issuing of Variation 7439 is credible and plausible and consistent with what might be expected in the proper course of business. It is corroborated by the firs named applicant's concession. The Tribunal accepts Mr Morolla's evidence as to the content of the annexure to Mr Bousfield's email. There is no suggestion that the unsigned variations were re-sent electronically at any other time or were sent in hard copy.
In addition, what is clear to the Tribunal is that it is necessary to read Variation 7439 with Site Plan I to find an agreement that the applicants 'provide a panel and post … after handover' (to use their words in Item 8). As at the date of the variation, and indeed for almost two months prior to the variation, panel and post retaining by the applicants had been completely eliminated from the plans in favour of reinforcing the garage wall only. The panel and post retaining agreed to prior to that (Site Plan F) had been a short wall adjacent to the garage at only 1 metre high and to be constructed by the applicants prior to construction. For the statement made at Item 8 to make sense, in the view of the Tribunal, it must be referring to the panel and post wall drawn in on Site Plan I. It is unclear where the applicants' reference to a 1.5 metre high panel and post retaining wall came from since on none of the drawings is the height for panel and post retaining thus set. There is no variation referring to a 1.5 metre high retaining wall. There is nothing to corroborate the applicants' claim that a retaining wall of such height was agreed. Mr Morolla stated that there was nothing in the records of the company to show a discussion at the relevant time about the applicants building a 1.5 metre high retaining wall. He did, however, suggest that such a 1.5 metre figure is consistent with what might have been the height of a retaining wall to be built if the floor levels had not been dropped. He hypothesised that the figure may have come from an earlier discussion now superseded by the lowering of the floor level and that the first named applicant may, in error, be recalling the 1.5 metre height as part of the later discussion about the angled retaining wall once the floor levels were lowered.
The Tribunal finds that it is more probable than not that the parties agreed, partly orally and partly in writing, (that is, by their discussions as ultimately set down in Variation 7275, Variation 7439 and Site Plan I) that the contract was varied as to the retaining on site to provide that the respondent would provide a reinforced garage wall in lieu of retaining adjacent to the garage and that the applicants would provide retaining walls as per those illustrated on Site Plan I after handover. The Tribunal finds that it is more likely than not that the applicants received Site Plan I (even though an initialled copy may, in error, never have been returned to the respondent).
This is significant because it underpins the finding that the Tribunal also makes below in these reasons that the respondent reasonably approached the execution of the cut on the basis of the above understanding as to how the angled retaining wall on the lefthand side of the house would be done by the applicants at a later stage.
It is in that context that the Tribunal then considers the evidence as to what was done in the execution of the cut.

The execution of the cut

The relevant questions are:
1)Was it a proper and proficient performance of the earthworks building service for the respondent to excavate as it did? and
2)Was the excavation work done, executed properly and proficiently or was it faulty and defective?
It is clear that the respondent is obligated as part of its contractual obligations to perform earthworks to construct a sound sand pad sufficient to allow for construction and to allow for level access down the lefthand side of the garage. Undisputed evidence was led that the sand pad upon which the house was to be built needed to be constructed so as to have a working platform of level sand between 1.5 and 2 metres wide around the perimeter of the planned house and to allow for the paving and the soak wells as marked on Site Plan I.
The respondent provided evidence that, upon going to site in preparation for the pouring of the slab, its officer identified that tree roots (left over from tree removal by the previous owner) remained in the lefthand side bank intruding onto the slab line and needed to be removed before the slab could be poured. The contract provision for earthworks does not include tree or stump removal. A variation was therefore required for the respondent to do these works, hence Variation 7867 was brought into being on 16 April 2014 (signed 30 April 2014).
The respondent argues that, in performing the earthworks contracted for under Variation 7867 to 'cut lefthand side bank and to pull out stumps', it was a proper and proficient performance of the earthworks building service for it to have utilised the opportunity to excavate as required to deal with the stumps and finalise the sand pad as set out above.
The respondent appeared to argue that, even if the Tribunal accepted that the excavation done was in fact greater in scope than was required for the provision of the construction sand pad, and had they excavated to a greater extent, specifically for the retaining wall, although arguably not contractually obliged to do so, that this would still have been a proper and proficient performance of the earthmoving service in the particular circumstances of this property and this house design.
The respondent indeed says that it would have been unreasonable for it to have not done so. It says that, given the slope on the lefthand side of the block, it would have been next to impossible for the applicants to access the relevant area to be retained with the required machinery needed to excavate for the planned retaining wall after the construction of the house; that, assuming access, the very task of excavating the relevant area after construction of the house would have been much more difficult if not impossible to do properly; that it was a proper and proficient performance of its excavation obligations under the contract, and was to the benefit of the client, that the respondent do the excavation work required for the retaining wall at the time that they were cutting adjacent to the garage and finalising the sand pad; indeed that the applicants could have legitimately complained if the respondent's work had not taken account of these matters.
As to the size of the cut, the respondent disputes that it overexcavated. It also emphasises that the retaining wall proposed required side access past the garage and a working platform of 1.5 to 2 metres in width.
The applicants continued to press the argument that they were expecting that any earthworks required for retaining to be done by them would be their responsibility and that size of the cut as in fact executed, came as a complete shock to them. It appears that at the time that Variation 7867 was signed (30 April 2014), the first named applicant was away. The variation was signed by the second named applicant. It is noted that each held Power of Attorney for the other for contract documents. The applicants' claim is that there was no explanation given as to what the wording 'the lefthand side cut' meant or as to the excavation work that would be done. They emphasise that it was presented only in the context of an issue having arisen as to the need for the removal of some old tree stumps 'on the slab line'.
Evidence was given to the Tribunal by an earthmoving contractor Mr Brandon Ricciardo. The Tribunal found him to be a credible and believable witness who gave his evidence in a candid and forthright manner. He gave evidence initially to the hearing in support of his quotation for the supply and compaction of clean fill (sand) to the property to remediate the site. His evidence was that the scope of works given to him by the respondent was to supply fill to the site to establish a batter for the retaining wall to be built by the applicants; that is, a batter to run from the natural ground level at the lefthand boundary of the property to the top of the proposed retaining wall graded at 1:4. In the course of his evidence on this topic, it became apparent that he was the earthworker who did the original cut.
His evidence about that was that at the time of the initial cut, he had been given Site Plan I. He stated that the scope of works for that job had been to do the earthworks needed for the sand pad only; that in doing so, he was to cut to a line just to the left of the retaining wall to be built by the applicants as drawn on Site Plan I. The intention was that he cut into the bank as required for a level sand pad and leave a semivertical cut in the left-hand bank, just (150200 millimetres) to the left of the line of the planned retaining wall (the intended cut line) to allow for the twin side (panel and post) wall to be later put into place by the applicants.
His evidence was that the intended cut line was, coincidentally, almost exactly aligned with the edge of the sand pad required to be prepared by him for the construction of the house. To that extent, he described his job as being excavations for the purposes of the sand pad rather than as including, specifically, excavations for the purposes of the retaining wall. His evidence was that, unfortunately, because of the nature of the sand, being, as he described it, 'beach' sand, he could not construct a semi-vertical face to the left-hand side of the cut along the intended cut line as planned; that the face kept collapsing; that 'the more we scraped, the more it collapsed' and that he had to construct a batter rather than simply leaving a semi-vertical face to the excavation; that 'we just had to scrape it back until we thought it was safe'.
His evidence was that, in order to make the batter safe, they had to take out an extra 200m³ of sand and had to 'batter it back to the boundary' at a slope of approximately 1:1. He stated that he graded the batter down from 1 metre inside the site boundary to the edge of the sand pad he had constructed for the house. His evidence was that he knew about the fact that the applicants' construction of the retaining wall would be after handover of the house but stated that the batter as constructed was always intended as a temporary measure which was not expected to have been left for four years. His evidence was that he was comfortable that, even without erosion control measures, the batter as left by him, would have been satisfactory for the estimated build time for the house (six to 12 months), possibly even for as long as 18 months. His evidence was that beach sand does not collapse under its own weight on a 1:1 batter and that he considered the batter as constructed to be a safe temporary batter from the point of view of subsequent workers on site and the neighbours. He accepted that he did not put in erosion control measures but states that they could have been placed on site by either of the parties after the cut was done. He conceded that the additional sand removed from the site was not stockpiled but went to waste. No explanation as to why this was done was given by the respondent or by Mr Ricciardo.
In response to a specific question from the Tribunal Mr Ricciardo accepted that because of the alignment of the planned retaining wall, little if any more excavation than what was required for the respondent to build the house was done other than to the extent that further excavation was necessitated because of the caving in of the loose sand.

Expert evidence

The Tribunal notes the largely uncontested evidence of Mr Viska, a surveyor, as to the compliance requirements concerning excavations. The Tribunal's view is that the presence or absence of the relevant approvals for the excavation work done is not determinative of the workmanship of the earthmoving undertaken on the behest of the respondent. The evidence of Mr Morolla, who is a registered builder, was that the excavation was done appropriately under the building permit held by the respondent as a temporary batter pending the installation of the necessary retaining wall. He conceded that if an excavation of this nature had been done in other circumstances, further approval may have been required.
In relation to the engineering evidence, there was agreement between the engineers that:
1)The site is a difficult site.
2)Access is still possible now that the house has been constructed. It will require some care and planning given the space available and some 'shoring up' may be required but access is not 'a showstopper'.
3)After the retaining is done, fill in the form of soil/sand will need to be brought back to the site to backfill behind the line of the retaining wall as illustrated on Site Plan I.
4)The stability of the batter as cut and graded is potentially more stable in the curved corner than in the straighter sections.
5)The batter as cut and graded has deteriorated but it has not failed.
6)If there had been no angled retaining wall proposed to be built, then the cut at the front would have involved a smaller shallower batter and temporary shoring could have stabilised the rear part of the slope.
7)To construct the angled retaining wall illustrated on Site Plan I, a working platform of 1.5 2 metres would be required on the lefthand site of the line of the wall. The engineers provided (in Exhibits C and D) agreed diagrams illustrating what in their view represented:
(i)the minimum sand pad cut required just to construct the sand pad for the house and where the top of the required batter would be for that; and
(ii)the extent of the excavation that would be required to allow for the construction of the retaining wall as well and where the top of the required batter would be for that.
8)The retaining wall as illustrated on Site Plan I could not have been constructed by the applicants without excavation exceeding the minimum required for the sand pad alone.
9)It would be possible to use a panel and post retaining wall aligned as on Site Plan I but only 1.5 metres high but it would be necessary to stabilised the batter behind with stone pitching (to step the batter back) or reinforcing matting.
10)There are a number of engineering solutions available for the retaining issue on the property.
11)Solutions include panel and post retaining, limestone block retaining, terracing or stone pitching using either stone or concrete paving slabs.
12)Assuming engineering solutions are appropriately designed, it is for the client to choose based on price and aesthetics.
13)A wall constructed of reconstituted limestone blocks designed correctly and positioned as per the Site Plan I drawing will do the job.
14)The essence of the disagreement between the engineers was how best to retain this block, Mr Vasile emphasizing that the applicants are his clients.

Consideration

Notwithstanding the apparent differences in their reports, upon a consideration and discussion of their evidence in the hearing, there is little relevant difference in the expert evidence save that Mr Vasile is proposing a solution that is acceptable in its aesthetics to his clients (the applicants) and Mr Purich is proposing a solution that is said to be satisfactory as an outcome for the most economical price.
The points of differences between the experts were:
a)whether, knowing that the applicants will build the retaining wall, it is reasonably for the respondent to excavate for the retaining wall. On this point Mr Purich (for the builder) said yes; Mr Vasile (for the applicants) said this was not an engineering question and was therefore outside of his expertise; and
b)Mr Vasile expressed the view that the cut should not have taken place until the retaining wall issue had been resolved the type and location of the retaining wall. Mr Purich took the view that, once the floor (and paving) level was known, the cut as planned was going to be needed.
In the view of the Tribunal these points or difference can be dealt with as follows.
In relation to b) the Tribunal accepts the evidence from the respondent that the type and location of the retaining wall had been agreed and was known prior to the cut being done.
The question posed in a) does not require determination as the Tribunal takes the view, on the largely uncontroverted evidence of Mr Ricciardo which it accepts, that, prior to the collapse issues that occurred during the course of the semi-vertical cut, the excavation work that was intended to be performed was little if any more than what was required for the respondent to prepare the sand pad for the house. It accepts that the original intention was not to excavate for the retaining wall but rather, the intention was to do a semi-vertical cut 150 200 millimetres to the left of the line of the proposed post and panel wall; that little if anything more than the excavation needed to build the house was cut other than to the extent that further excavation was necessitated because of the caving in of the sand into which the cut was being attempted.
The Tribunal accepts that the cut only exceeded this plan because of the nature of the sand. It accepts that the semi-vertical cut could not be maintained as planned and that it continued to collapse down as the earthworkers persisted with their attempts. The Tribunal accepts that the contractors then determined, in the view of the Tribunal reasonably, that the only course of action was to endeavour to construct a safe batter to support the lefthand bank. As can be seen by comparing the survey done after the cut (HB 116) with Site Plan I, the toe of the batter actually cut (shown as a dotted line running from the front corner of the garage to the rear sand pile) runs almost along the line of the proposed panel and post retaining wall.

The Tribunal notes the agreed evidence of the experts that the retaining wall as illustrated on Site Plan I could not have been constructed by the applicants without excavation exceeding the minimum required for the sand pad alone being done. The Tribunal notes the evidence of Mr Ricciardo as to the intended cut line for a post and panel wall. The Tribunal accepts the evidence of the engineers that to construct the angled retaining wall illustrated on Site Plan I, a working platform 1.5 2 metres wide would be required on the lefthand site of the line of the wall.
Somewhat serendipitously, the batter ultimately cut by Mr Ricciardo following the failure of his plan to cut a semi-vertical face, in fact largely complies with the opinions of the experts, that is, the excavation was done in such a way that the toe of the batter was far enough away from the line of the proposed retaining wall to allow for a working platform adjacent to the wall, but was close enough to allow for a safe angle of repose for the surface of the batter running from the toe up to the top of the slope. The Tribunal accepts that the excavation actually cut (whatever the intended cut line had been) represents an excavation property and proficiently executed in all the circumstances given the known retaining plan and the difficulties encountered with the site, which the respondent is entitled to take as he finds it.
The Tribunal does however take the view that, given that there was clearly going to be a need to backfill and establish the surface of the lefthand bank after the retaining was done, the respondent should have stockpiled the sand on site that was removed from site in order to save the applicants the expense of purchasing new fill. Although the Tribunal notes the submission of the respondent's counsel that 'it was difficult to store the excess on site', there was in fact no evidence as to why the sand was not stockpiled or justifying the removal and discarding of the sand. To remove the fill and to dispose of it to waste was not proper and, in the view of the Tribunal, the respondent should reimburse to the applicants, the cost of fill required. (see below)
Lest the Tribunal should be wrong in this conclusion, it makes the following additional findings and observations.

The effect of delay

The applicants claim that, as a result of the passage of time, the state of the batter is much deteriorated in that there has been further sand slippage and erosion. The applicants put the argument that an engineered terracing system such as that designed and quoted on by Mr Vasile is necessary to properly remediate the lefthand bank.
Given the above finding that the excavation was properly and proficiently executed, the Tribunal takes the view that, in the changed circumstances and given the risks to which the applicants' attention had been drawn, to refuse to bring forward the retaining of the bank was unreasonable. The Tribunal takes the view that any additional expenditure that is required by reason of that refusal and the subsequent delay in constructing the retaining wall falls to the applicants and not to the respondent. In any event, there was no expert evidence presented that alterations to the surface of the site slope by reason of erosion and sand slippage on the batter has in fact increased the cost of the works that will be required to be done to prepare and backfill the site after retaining by the applicants.
The Tribunal notes that the respondent offered to complete the construction of a limestone retaining wall a cost of approximately $30,000 during the post-cut negotiations as a means of progressing matters. The applicants refused that offer. These matters are undisputed. In the circumstances, had that offer been accepted, any consequences of the delay could have been mitigated.

Remediation costs

The applicants seek a payment order that the respondent meets the cost of the engineered retaining solution (a terraced cantilever wall of concrete filled blockwork or cavity filled masonry walls or reinforced concrete walls) designed by Mr Vasile, being a cost ranging from $124,366 to $166,363.63.
The respondent's case is that the applicants have presented a much more elaborate system of retaining as the remediation solution than is reasonably necessary for the site, particularly given that it was always part of the contract that the applicants meet the cost of the retaining work after handover. The respondent points to the evidence of the applicants' own expert Mr Vasile that the method of remediation proposed by the respondent, namely a retaining wall constructed of limestone blocks designed correctly, would, from an engineering point of view, 'do the job, definitely'.
The Tribunal accepts the respondent's argument in this respect. The evidence of the experts is that there are at least four ways of retaining the block. Terracing as proposed by the applicants is merely one of them. The applicants are of course entitled to have whatever style and design of retaining that they wish. Had the respondent been found liable to them for defective workmanship, they would, however, only have been liable for the reasonable cost of remedying the defect. The Tribunal accepts that the remedy proposed by the respondent, namely the use of limestone blocks to build a retaining wall, is a reasonable one.
It is to be noted that Mr Vasile stood by his design as being what the applicants wanted. In his closing submission the first named applicant sought to persuade the Tribunal that the applicants had not asked Mr Vasile for that design; that it was not an elaborate requested design but rather reflected the reasonable cost of remediating the site. The Tribunal does not accept this submission given Mr Vasile's evidence. It is clear from his evidence and from the evidence lead by the respondent that a perfectly adequate solution would be available at a significantly lower cost in the event that the respondent had been found liable. In that respect, it is noted that the respondent's suppliers gave evidence of two alternatives a reconstituted limestone wall as had been discussed by the experts at $23,100 (inclusive of GST but exclusive of earthworks) and a Wonder wall panel and post retaining wall at $41,525 (inclusive of GST but exclusive of earthworks and building approvals).
The Tribunal is not persuaded that the limestone wall solution proposed by the respondent is sufficient given that in the wall quoted for, no allowance has been made for supporting the backfill behind the retaining wall sloping up to the north boundary. The wall has been quoted based on level fill behind the retaining wall. Mr Morolla agreed that if this is accepted, and if double the limestone were needed for strength, then the quote would be insufficient and would in fact be perhaps not double but somewhere between $23,000 and $40,000. That is the Tribunal's finding.
Despite their expert's concession as to suitable alternatives referred to earlier, the applicants have not presented remedy cost evidence for any solution other than Mr Vasile's terraced design. They submit that the respondent's quotations are not fair and reasonable. The Tribunal rejects this submission.

Removed sand

As was pointed out in closing by the respondent's counsel, the issue of what options to stockpile the excavated sand on site or elsewhere was not traversed to any great extent in the evidence. The Tribunal is satisfied that the respondent ought to have foreseen that, given the agreed plan to retain as drawn in Site Plan I, most if not all of the sand that was excavated would be needed by the applicants to backfill after retaining. It was not appropriate that it go to waste and arrangements should have been made to stockpile it.
The calculations done by the respondent's engineers as to the quantity of sand are accepted by the Tribunal as is the quotation from Mr Ricciardo at $9,460 excluding GST which, according to him, was based on those calculations. Inclusive of GST which the applicants will clearly have to pay, that figure is $10,406.

Conclusion

The Tribunal is of the view that the respondent is liable to the applicant only for the cost of replacement sand fill and the cost of backfilling it appropriately onto site.

Orders

Accordingly the Tribunal makes the following order:
1.Under s 36(1)(C) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA), the respondent is ordered to pay to the applicants the sum of $10,406 within 28 days of the date of this order.
2.The application under s 5 of the Building Services (Complaint Resolution and Administration) Act 2011 (WA) is otherwise dismissed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.
MS H LESLIE, MEMBER
12 NOVEMBER 2018