Von Nagy v M Ewald Building Pty Ltd - [2013] QCAT 668

CITATION:

Von Nagy v M Ewald Building Pty Ltd [2013] QCAT 668

PARTIES:	Dr Melissa Von Nagy (Applicant)
v
M Ewald Building Pty Ltd (Respondent)

APPLICATION NUMBER:

MCD1318/13

MATTER TYPE:

Other Minor Civil Dispute Matters

HEARING DATE:

29 August 2013

HEARD AT:

Brisbane

DECISION OF:

Member McLean Williams

DELIVERED ON:

4 November 2013

DELIVERED AT:

Brisbane

ORDERS MADE:

1. Application dismissed.

CATCHWORDS:

Minor Civil Dispute matter – Building – Cost plus agreement – contract terminated – remediation works

APPEARANCES and REPRESENTATION (if any):

APPLICANT:

Applicant, in person

RESPONDENT:

Respondent, in person

REASONS FOR DECISION

These are my written reasons for decision in matter MCD 1318/13.
The applicant is a homeowner who retained the services of a builder, M Ewald Building Services Pty Ltd in early 2011, in order to investigate water ingress into her home at Chapel Hill, and repair water damage.
At this juncture it is significant to record that the applicant’s home is at least 35 years old and has prominent exposed structural trusses made of timber. The webs within these trusses have large sheets of glazing installed within them, forming windows. These are held in place by means of timber beading.
Initially, the scope of works contemplated by the parties was quite modest. This is revealed by the original quote from the builder to the homeowner, dated 13 February 2011. The quote, which was accepted by the homeowner, provides:
Repair the following which have been caused by water damage. The water has been penetrating through the timber beadings around the glass
·Replace timber beading around the glass
·Sikaflex seal between the glass and beading and beading and timber work
·Install section of flashing
·Bog and prime holes in ship lap cladding and bearer
oI have allowed 20 tubes of Sikaflex
oI have allowed 5 lengths of beading
oIf any extra is required it will be charged at cost plus 10% and labour charged at $45 plus GST per hour.
·Replace 2 sheets of Gyprock and cornice in office area, damaged by leak.
oPlaster ready to paint.
Total:$1,980 inc. GST
There was no written contract, as the works proposed were for less than $3,300, meaning that there was not any legislative requirement for a written contract.
After works had commenced the builder found significant structural damage to the timber trusses and support bearers, together with wood rot, and termite damage. Three of the large panes of glass within the web trusses were inadvertently broken by the builder, as the result of the glazed panels being subjected to edge loads due to the loss of perimeter clearance between the glass and the trusses, because of the deterioration of the timber structural members supporting these trusses.
At this point, the respondent advised the homeowner that he could not proceed to repair the edge beading in the manner he had quoted, without significant risk of further glass breakage. The builder recommended that the extant (rotten) beading should merely be sealed, by means of Sikaflex and that nothing else should be disturbed. At the same time, the builder advised that the services of an engineer should be retained by the homeowner, in order to report on the structural condition of the house.
A report was obtained by the homeowner from Alex Milanovic & Associates, Consulting Civil and Structural Engineers, on 8 April 2011. The engineer’s report details significant structural problems with the home that had been caused by wood rot and termite damage, and details a recommendation for remediating the house.
On 19 April 2011, the applicant and the respondent entered into a new ‘cost plus’ conversion contract for the respondent to effect repairs to the applicant’s home. In other words, the original oral contract between the parties was abandoned, and was replaced by a new agreement. There was no written scope of works. In the circumstances that I have described this is hardly surprising, given that it would not then have been possible to accurately predict the works necessary to remediate the house, as more damage was likely to be revealed as the works progressed. At item 4 of the contract dated 19 April 2011, the works are broadly described as:
3 level split timber framed house
repair termite damage
repair water damage
All damage is existing and no termites were found.
Work by the respondent under the new cost plus agreement then proceeded. I discern from the evidence that most of the respondent’s work was inside the house. The job was a drawn-out one, and the homeowner was unhappy about that. On 21 June 2011 the Applicant’s husband e-mailed the respondent complaining that, to date the job had cost far more than they had expected, and was still unfinished. In part, the applicant’s husband wrote:
….We don’t think you are dishonest, you obviously want to do the right thing, but you and your workers are very slow, this job has cost way too much money and time. There’s no hard feelings, we just think this is unfair and you can do more to make it right. I’d suggest you should try and make amends and discount this invoice substantially as well as the legitimate deductions Melissa spotted, and finish the work with no further cost to us. I’ll look forward to hearing your response before we proceed.
On 22 June 2011 the respondent wrote back to the Applicant’s husband, pointing out that it had been their choice to enter into a cost plus contract, and that it was impossible, in the circumstances of this job, for him to predict how long it would take, or how much it would cost, and hence the very reason why the contract had been entered into on a ‘cost plus’ basis. After agreeing to deduct some items from the last invoice, the respondent also terminated the contract, with effect from that date. Because the contract was a cost plus one, I take the view that the builder was entitled to terminate at that point without his having fully completed the remediation project. In all events the e-mail from the applicant’s husband invited that termination.
On 7 December 2011 the applicant sent a text to the respondent, complaining that the house was again leaking:
Michael, you are going to need to rectify your work or refund quite a bit of money. The house is leaking v badly where you said it was water tight. I don’t want to take legal action. Can you pls come on Fri pm to discuss this with me so we can negotiate an outcome we can both live with?”
Mr Ewald then came and inspected the house, and found that the various temporary repairs that had been made by him by means his applying sikaflex over the existing rotting beading around the windows in the end trusses was still intact. Because of that, Mr Ewald declined to refund any money. In a letter dated 20 December 2011 he expressed his position as follows:
The water ingress in the scope of works completed forms [only] a small portion of labour costs. As per the contract any material costs were the responsibility of the owner if they were damaged as a result of existing structural issues. We have discussed on several occasions that the cost of replacing the glass panels (total of $6,000) were in fact your responsibility, however in good faith these were paid by me. Any further investigation will need to be completed by the BSA.
Subsequently, the applicant did make a complaint to the Queensland Building Services Authority (QBSA). An inspector from the QBSA attended at the house and conducted an inspection. However, the QBSA then declined to issue a Direction To Rectify (DTR) to Mr Ewald pursuant to s 72 of the Queensland Building Services Authority Act 1991, because the QBSA determined that it would be unfair in the circumstances of this case to issue a direction, because the inspector could not confidently conclude that water was entering into the dwelling as a result of defective building works performed by the contractor.
This claim has been commenced before QCAT by the home owner in order to recover a portion of the monies originally paid to the respondent and to seek the costs of various further repairs that were undertaken to her home to remediate the further water damage that had been revealed in December 2011, approximately 6 months after the respondent terminated their costs plus agreement.
In order to establish that the respondent did not undertake his repairs correctly – thus necessitating that the repairs be repeated at further cost to the homeowner – the applicant relies upon an inspection report (attachment 8 in her materials) provided to her by “Pattersons Insura-build”. That report indicates that an inspection was undertaken on 15 February 2012, by a Mr Callan Winterbottom. The report describes internal water damage to the applicant’s home and opines that ‘the damage was caused by the windows not being sealed properly and water ingress through the windows’.
Mr Winterbottom was not called as a witness before QCAT. The only evidence of negligent or incomplete work by the respondent in Mr Winterbottom’s report is the passage that I have just quoted.
At the hearing of this matter the respondent indicated that it was his position that the works performed by him prior to the date of termination on 22 June 2011 were performed in a competent manner. It was the respondent’s further position that any further water ingress to the applicant’s home after that date was as the result of other areas of leakage that had not been addressed by him prior to the termination of the cost plus agreement.
I am not satisfied in relation to the sufficiency of the evidence provided in the report given by the applicant from Patterson’s Insura-build. That evidence does not discern, in any specific fashion, that the water ingress has been through parts previously repaired by the respondent builder, although that conclusion may arguably be said to arise by means of necessary implication. Although I have spent some time considering that possibility, I am left with a residual sense of unease about my ability to confidently draw that conclusion, even on the balance of probabilities. I note that the engineering report obtained by the applicant from Alex Milanovic & Associates reveals that the glazing beads surrounding the glass panels in the end trusses had ‘deteriorated allowing water entry’. Yet, I also note that it had been agreed between the applicant and the respondent that the timber beading was not to be replaced (due to the risk of further glass breakages) and that a bead of caulking material was to be put over the top of that, instead. Then, by the time that the QBSA came to inspect the property the inspector could not be confident that the works performed by Mr Ewald were the cause of the further water ingress in December 2011 and January 2012 - this despite the inspector observing that it was still evident that there was ongoing water ingress to the inside parts of the house by means of the glass panels within the end web trusses (see page two of his ten-page report). Despite that observation the inspector would not issue a direction to rectify on the basis that there were just too many other potential sources for water entry.
This Tribunal is entitled to inform itself in the manner that it considers appropriate (see QCAT Act s 28). In that light, I do now attach significance to the QBSA inspection report, as I do to the respondent’s contention that the contract was terminated, before all of the remediation works had been completed by him.
On the whole I am therefore simply unpersuaded in relation to the contention that further water damage is attributable to prior poor work by the respondent.
I dismiss the application.