Waid v Casey - [2012] QCAT 533

CITATION:

Waid v Casey [2012] QCAT 533

PARTIES:	Caroline Patricia Waid
v
Thomas Gerard Casey t/as Mackay Queensland Homes

APPLICATION NUMBER:

BDL337-10

MATTER TYPE:

Building matters

HEARING DATE:

7 October 2011

HEARD AT:

Mackay

DECISION OF:

Jim Allen, Member

DELIVERED ON:

26 October 2012

DELIVERED AT:

Brisbane

ORDERS MADE:

1. The application is dismissed.

CATCHWORDS:

Building dispute – Duragal posts – Builder duty of care – Limitation of action – Contributory negligence

Limitation of Actions Act 1974, s 10

Bryan v Maloney (1995) 182 CLR 609

APPEARANCES and REPRESENTATION (if any):

APPLICANT:

Ms Waid appeared for herself

RESPONDENT:

Mr Casey appeared for himself

REASONS FOR DECISION

Ms Waid engaged Mr Casey to build her a house in 1995. The house sat on Duragal posts and over the years these posts have become subject to rusting. Ms Waid now seeks an order that Mr Casey pay the cost of replacing the 31 Duragal steel-in-concrete posts which support her house and where necessary to install bracing to any posts which were greater than 900 mm above ground level. This bracing is said to be required in accordance with the Building Code of Australia.
During the course of the application Ms Waid contracted for all of the steel posts to be replaced by LGM House Restumping Pty Ltd at a cost of $19,075. Ms Waid had earlier filed a quote by that company to replace any damaged posts at a cost of $550 per post plus GST.
There were further claims made in the course of the matter as follows:
a)    Handrail to balustrade on deck 900 mm instead of 1000mm high as drawn on the plans;
b)    Builders specifications on page 3 shows 4 mm cpw posts approved house plans specify 5 mm;
c)    Front and back steps specify steel stringers according to builder’s specification and timber stringers were supplied;
d)    Piers not set at 600 mm into footings in accordance with the approved plans for the house; and
e)    Resealing of whirly bird on roof of house.
At the hearing Ms Waid accepted that the claims in regard to the handrail and the stairs were barred under the Limitation of Actions Act 1974[1] and agreed not to pursue those claims. Those claims relate to breaches of contract in that the item specified was not constructed in accordance with the plans. The breach occurred as at the date the contract was completed which date is more than 6 years prior to the date on which the claim has been brought.
[1]Section 10(1) of the Limitation of Actions Act 1974 actions may not be brought after the expiration of 6 years from the date on which the cause of action arose.
The claim in regard to the posts may be brought in tort for negligence and a claim in negligence arises at the time when the latent defect is discovered or becomes manifest; that is discoverable by reasonable diligence[2].
[2] Bryan v Maloney (1995) 182 CLR 609.

Negligence

For Ms Waid to succeed in a claim in negligence she must establish that:
a)    Mr Casey owed her a duty of care recognised by the law;
b)    There has been a breach of that duty by Mr Casey; that is, a failure to conform to the required standard of care;
c)    Ms Waid has suffered material damage which was caused by Mr Casey’s breach of duty;
d)    There is a reasonable proximate connection between the action of Mr Casey and the damage done to Ms Waid; that is, the damage must not be too remote; and
e)    Ms Waid may be required to counter any defences raised by Mr Casey to refute his liability. These could include contributory negligence and the action being barred under the applicable limitation period.

Did Mr Casey owe Mrs Waid a duty of care?

Ms Waid contracted with Mr Casey for him to build her a house in 1995. While the relationship between the parties was created in contract that does not mean that concurrent duties cannot exist in tort[3]. A builder owes a duty of care to a building owner to exercise reasonable care in relation to building work to avoid a foreseeable risk of injury and what is known as pure economic loss[4].
[3] Bryan v Maloney (1995) 182 CLR 609.
[4] Bryan v Maloney (1995) 182 CLR 609.

What is the required standard of care and has there been a breach of that standard?

From the above Mr Casey is required to exercise reasonable care. This has been equated to “that which an ordinarily skilled builder would be expected to employ. The standard may be set by industry practice, such as the use of standards or codes. Another means of assessing the standard of care used often in relation to building and construction cases is by analysis of the information and knowledge generally available on a specific material or problem at the time of the alleged negligence”[5].
[5] Bailey I and Bell M Construction Law in Australia Third Edition Lawbook Co at 131.

Rusting of the Posts

The major issue here is in relation to the Duragal posts which were used in the construction of the house. Ms Waid seeks to rely on the Duragal Paining Guide 1992 as establishing how the steel posts used by Mr Casey should have been prepared for use in the house. This painting guide was referenced to the Australian Standard 2312-1984 which applied at the time.
The Painting Guide described various atmospheric classifications and stipulated the corrosion life of unpainted Duragal over various periods in respect of those climates.
Ms Waid considered that the location of the house at Hampden near Mackay constituted a Very Severe atmospheric classification on the basis that it was a Coastal/Marine environment, that is within 15 km of the eastern coast. This required that the posts should have been painted before they were embedded in the concrete footings and that was not done in this case. Ms Waid provided photos showing the house under construction[6] – these show the unpainted posts inserted into domed concrete footings.
[6] Ms Waid’s letter to the Tribunal dated 19 September 2011.
Mr Casey provided a report from Mr Tony Mitchell, manager building services of Master Builders Queensland. Mr Mitchell states in his report that the original works completed in 1995 have been provided in accordance with the Building Code of Australia and the Duragal product recommendations at that time.
Mr Mitchell notes that the dwelling was given building approval on 5 April 1995 and that the appropriate statutory standard was the AS2312-1984 guide to the protection of Iron and Steel against exterior atmospheric conditions and that the building contractor should have given consideration to the manufacturer's recommendations contained within the 1992 Duragal Painting Guide. Thus confirming Ms Waid’s view of the required standard.
He advises that the original works completed in 1995 have been provided in accordance with those requirements and that the corrosion which has occurred to the steel columns at the point where they enter the concrete piers on this home is the exact same problem which was subsequently addressed by an amended Duragal Painting Guide in 2001.
This is said to be due to the now common knowledge that the junction of concrete to steel is a problem area for corrosion due to contact with acidic contaminants. The 2001 Guide therefore recommends that the Duragal concrete junction be painted 100 mm either side of the junction, however, it is not a requirement that the entire embedded section of Duragal into concrete requires painting.
Mr Mitchell considered that irrespective of whether the house was located in a “moderate’ or “very severe” environment that the Duragal would perform 2-5 years before maintenance was required and this was the life requirement which he said was applicable where there was no statutory or building code requirement and the building component was accessible. Mr Casey in his submissions had stated that there was no prescriptive requirement for the lifespan of a building apart from termite barriers. Ms Waid in reply to this referenced AS 2870.1 1988 “Residential slabs and footings” which had design requirement as 50 years. Ms Waid did not produce a copy of this document to the tribunal.
Ms Waid has not provided the Tribunal with sufficient information to determine whether or not that design life requirement applied to areas such as footings under a slab which are inaccessible or in this posts in footings which are accessible and capable of maintenance and will accept the opinion of Mr Mitchell as it reflect the fact that the posts are accessible to be maintained.
Mr Casey was of the view that the house was in a moderate climate zone, which is more than 15 km from the coast and with 300 to 1000 mm of rainfall. The material he provided included a Mackay Regional Council map showing that at its closest Hampden was 17.6 km from the coast. He also provided a Bureau of Meteorology summary which described the climate of Mackay as tropical with average annual rainfall of 1585 mm and lying in the trade wind belt resulting in south to south east winds, and afternoon northeast breezes in the warmer months.
The moderate classification in the 1992 Duragal Painting Guide has rain between 300 to 1000 mm. The “Very Severe” Tropical classification has rain greater than 1200 mm being in the coastal areas of northern Queensland. It is noted that the corrosion life for unpainted Duragal is the same for very severe tropical and moderate, that is it is suitable for long term use 10-15 years.
Mr Casey produced letters from four local builders which supported that it was not a requirement for Duragal to be painted before being embedded in concrete[7] at least a the time that Ms Waid’s house was built. This goes to industry practice at the time of the building of the house.
[7]B.R & C. Burgess Builders letter 24 January 2011, Barry Bryan Builder letter 25 January 2011, Rick Chelman Builder Pty Ltd letter 4 February 2011, Malcolm Hull letter 20 January 2011.
The house plans[8] do not specify that the Duragal be painted. Ms Waid provided a set of council approved house plans[9] and she did not raise in the correspondence accompanying them that painting of the posts had been required in the plan. Ms Waid provided a copy of the plans for the restumping of the house[10]. These noted that the concrete post interface was to have bituminous paint 100 mm either side of the interface, which accords with the 2001 Duragal Painting Guide. The fact that Mr Casey has installed the posts in accordance with the plans is clear evidence to support that he has not breached his duty of care.
[8]        Document 33 of Mr Casey’s statement of 8 August 2011.
[9]        Document 3 of Ms Waid’s letter of 29 August 2011.
[10]        Document 8 to Ms Waid’s letter of 29 August 2011.
Mr Wayne Halliwell a supplier of steel to Mr Casey gave evidence that at the time they would paint welds and put plates on the top of posts and that all the information was on the plan. In reply to Ms Waid Mr Halliwell stated he had never seen the painting guide.
Mr Brian Mayer a structural engineer gave evidence at the hearing for Mr Casey. He stated that he was familiar with the Duragal Painting Guide and that painting piers is an extra barrier for protection.
Ms Waid's application noted that she first became aware of the steel and concrete foundations posts rusting in September 2009. A letter she had written to Mr Casey dated 17 July 2010 stated that “a year ago a Mackay Pool builder called my attention to my posts”. Ms Waid stated in her application that the steel posts were inadequately prepared, that the galvanised steel has reacted with the cement causing it to rust below ground level, the rust progressing to the visible part of the posts. The expanding rusting posts have caused the concrete to “explode” resulting in deep radial cracks which allow the entry of water and air which accelerating the deterioration of the structure.
The question of whether the rust commenced within the concrete pad or at the junction also goes to whether or not the defect is a latent one or not. In that regard the Tribunal notes that Ms Waid produced an extract from a valuation prepared by John Logan and Associates in approximately 2006 which noted “the foundations were steel stumps and that the dwelling is in sound structural condition considering its age and that Internal and external paintwork are in average condition”.
Mr Mayer in his evidence stated that rust does not start at concrete level out of sight and that rusting would start at the interface between concrete and the post. He said that he could not see corrosion starting in the concrete as it was an alkaline environment which inhibits corrosion. That the rust starts at the interface and as steel rusts it expands which applies pressure on the footings which can cause them to crack. This was confirmed by Mr Mitchell in both his written and oral evidence.
The Tribunal prefers the evidence of Mr Mayer and Mr Mitchell over that of Ms Waid in regard to the origin of the rusting and notes in particular that their evidence is confirmed by the 2001 Duragal Painting Guide[11] which states “Contact with moist acidic contaminants of any kind will cause accelerated corrosion of zinc. The point where Duragal sections enter concrete footings or are below the surface of soil which gets wet at any time are common problem areas. This problem is common enough for OneSteel to recommend that all Duragal product/concrete junctions be painted. .. The paint should cover the Duragal for at least 100mm above and below the concrete junction. The concrete at the Duragal/concrete junction should be sloped to encourage any moisture to drain away from the steel member”.
[11] Attachment TM-9 to the report of Mr Tony Mitchell 7 July 2011.
Mr Mitchell in his report notes that there is confusion throughout industry and the community in respect to the embedment of Duragal posts in concrete. That the 1992 Duragal Painting Guide and the current Building code are silent on the issue. AS2312-1984 states that steel surrounded by an adequate thickness of concrete is an example where protection against structurally damaging corrosion may not be required[12].
[12] Attachment TM-6 to the report of Mr Tony Mitchell 7 July 2011.
On this basis even if painting of the posts was mandated there was no requirement that the part of the post immersed in the concrete be treated. This as mentioned above was only dealt with as a result of changes made in the 2001 Duragal Painting Guide.
While the severe rusting of the posts and cracking of the concrete led Ms Waid to bring the application this was not the first time that issues had arisen in regard to the posts. Ms Waid’s former partner, Mr John Hanson provided a statement that he had contacted Mr Casey about rust on the posts a short period after the house was completed and that Mr Casey had advised him to apply Penetrol to the posts.
Mr Hanson stated at the hearing that there had been rust on 6 of the posts and that it went from the concrete up. That he had taken the rust off and then painted on the Penetrol in accordance with its instructions and then painted the posts green. He stated that he had also painted all of the outside posts green. He had then repainted them approximately 6 months later. He said that while he was there he did the external house maintenance and he would look at the posts as he walked past. He said that he had not had any discussions with Ms Waid about maintenance of the posts.
Mr Casey provided photos which were taken of the house in 2010. Ms Waid confirms they were taken on 19 September 2010[13], which showed that the majority of the posts which were rusting were painted green. They also show many of the other posts had no apparent signs of rust at that time.
[13] Ms Waid’s letter to the Tribunal 29 August 2011.
Ms Waid also alleged that the photos she provided of the house under construction showed that there was rust on the posts. Mr Casey was of the opinion that the stains were from the coating used on the floor boards. Mr Mayer thought that it would be hardwood stain. Mr Hanson stated that he did not see rust on the posts during construction. If there was rust on the posts at this stage that would make it harder for Ms Waid to show that her claim was in time. There is no proof of what the discolouration of the posts in the photos was as a result of was and the Tribunal will not consider it further.
As mentioned, during the course of the application Ms Waid engaged L.G.M. House Restumping to replace the stumps at a cost of $19,075, including variations. Ms Waid stated in her letter that all steel piers were corroded below ground level, even those that Mr Casey photographed with no visible rust or cracks in the concrete. A set of photographs of the posts which had been excavated were provided by Ms Waid[14]. Mr Mayer reviewed the photos and acknowledged that some posts had failed but others would have a few more years. The photographic evidence did not alter Mr Mayer’s view that the rust would start at the junction of the post and the concrete.
[14] Ms Waid's letter to the Tribunal 19 September 2011.
Both Mr Hull and Mr Mitchell in their evidence at the hearing stated that maintenance of the posts was important. Mr Hull stated that it was highly unlikely not to notice rust problem starting and that he had not seen rust to this extent before. Mr Mitchell stated that it was astonishing to allow posts to corrode to the degree they did and that there was a breakdown in the maintenance of the post.
Ms Waid as mentioned was of the view that the rust began below ground and she also said that she could not see it due to it being behind the paint work. The photographic evidence shows major cracks in the concrete and large holes in the posts. As noted above the Tribunal has not accepted that the rust commenced in the concrete and therefore the defect is not a latent one. The test is when was the defect is discoverable by reasonable diligence[15].
[15] Pullen v Gutteridge Haskins & Davey Pty Limited [1993] 1 VR 27.
Ms Waid has alleged that Mr Casey was negligent in not painting the posts as required by the 1992 Duragal Painting Guide. What is clear is that even if Mr Casey had painted the posts that would not have stopped the rusting which has occurred in regard to many of them. This is due to the fact that Mr Casey would have painted the exposed parts of the posts only as it was not required in accordance with AS 2312-1984 that the part embedded in concrete be painted.
It is only with the changes in the 2001 Duragal Painting Guide that the specific issue which has resulted in the rusting of Ms Waid’s posts was dealt with by the requirement of painting either side of the concrete post junction.
The Tribunal accepts the evidence of Mr Mitchell and Mr Mayer that the rust has occurred at the concrete post junction and that the steps needed to avoid this only became part of the standard of care at the time of the 2001 Duragal Painting Guide.
For these reasons Mr Casey has not breached the standard of care in regard to the painting of the posts. Even if Mr Casey had been required to paint the posts his failure to paint the exposed parts of the post was cured by the work done by Mr Hanson following his discovery of the rusting posts. That is the treatment with Penetrol of the rusting posts and painting of the posts on the perimeter of the house.

Depth of the posts, their bracing and width

While carrying out the re-stumping work it became apparent that many of the posts were not inserted into the concrete to a depth of 600mm as required by the plans. Ms Waid provided material[16] setting out the deviations from the plans in respect of each post and a letter from the house re-stumper confirming the depth in respect of one particular post.
[16] Ms Waid’s letter to the Tribunal 29 August 2011.
Mr Mayer also gave evidence in regard to the depth of the posts. Mr Mayer said that he had sighted the drawings. He said that an embedment of 300 mm was sufficient to mobilise uplift and footing and that the posts had performed just as well structurally. Mr Mayer acknowledged to Mrs Waid that the builder could not change the engineer’s plans without consultation.

Mr Casey in dealing with the need for bracing stated that the original plans and specifications anticipated that the site would be level. It is clear though from the approved plans supplied by Ms Waid that the site was not a level site and therefore the length of the stumps would need to be different to take account of this to ensure that they were embedded to 600mm.
Even if the Tribunal can be satisfied that Mr Casey has breached his duty of care in regard to the depth of the posts and the need to brace them Ms Waid has produced no evidence of damage as a result of this breach. That is there has been no failure of the posts and this is supported by Mr Mayer’s evidence that the embedment which is alleged by Ms Waid would have been adequate. There can be no claim for damages in negligence where there has been no damage. These allegations will not be taken any further in these reasons.
In the same way there has been no damage alleged in regard to the claim that the posts were not of the width required that is they were 4mm and not 5mm as specified on the plans and that allegation will also not be taken further.

Sand in the concrete mix

Ms Waid has also alleged[17] that the sand used in the mixing of the concrete footings was beach sand which would contain salt. She alleges that when the steel posts contract in cold weather they let water and oxygen in which in combination with the salt allows corrosion. This allegation was based on the extent of corrosion which she said was present in the steel in contact with the concrete. In the letter from the house re-stumper the concrete footings were described as follows “two types of concrete seemed to have been used. A fine very hard type for the pad and another coarse crumbly type around the steel pier. The concrete in contact with the steel broke up easily”. Mr Casey provided confirmation from his supplier[18] that the builder’s mix requested by him was always to be salt-free.
[17] Ms Waid’s letter to the Tribunal 29 August 2011.
[18] C. & J.C. Camilleri letter of 2 September 2011.
Ms Waid has no evidence showing an analysis of the contents of the concrete and the Tribunal will accept Mr Casey’s evidence from his supplier that he used salt-free mix. Therefore there can be no breach of any standard of care as the allegation has not been accepted.

The whirly-bird

Ms Waid has also claimed an amount of $381.30 for resealing of a whirly- bird and other roof leaks. She claims that the whirly-bird was negligently installed. The invoice from Townson Plumbing Pty Ltd[19] shows – travel to site to inspect roof leak, Undersealed whirlybird to ridge join resealed ridge cap at Apex. The house is 15 years old and it is likely that seals on such things as the whirly-bird may require maintenance after such a long period. The invoice from the plumber also does not disclose that the whirlybird was never sealed only that it was required to be resealed. There is no breach of a standard of care disclosed.
[19] Ms Waid letter to Tribunal 29 August 2011 document 9.

Has Ms Waid suffered material damage which was caused by Mr Casey’s breach of duty

While the Tribunal has not been satisfied that Mr Casey breached his duty in regard to the painting of the posts there has been evidence put before the Tribunal in regard to the claim for damages. For completeness the Tribunal makes the following comments in regard to that evidence.
In this case while some of the posts have shown clear signs of major rusting and the concrete in which they are embedded has suffered major cracking there is no evidence where any of the post has failed and caused either physical or property damage as a result. If there had been a breach by Mr Casey of his duty of care the damages would have been for pure economic loss[20]. That would have been the cost of replacing the posts
[20] Caltex Oil (Australia) Pty Limited v The Dredge “Willemsted” (1976) 136 CLR 529.
Ms Waid contracted to replace all 31 of the posts at a cost of $19,075. A review of the photographic evidence by Mr Mayer showed that only some of the posts required replacement. The only evidence that all of the posts needed replacement was Ms Waid's allegation that all steel piers were corroded below ground level with some very badly. The re-stumper did not provide evidence as to which posts required restumping. While many of the posts in the photos supplied by Ms Waid following the re-stumping showed discolouration they appeared otherwise to be structurally intact. The Tribunal therefore could not be certain of which part of Ms Waid’s claim would have been allowable even if it had found a breach of duty.
Based on the photos supplied by Mr Casey it would appear that at the time those photos were taken in 2010 there were 10 posts which showed major rust at the junction between the post and concrete and or cracking of the concrete footing. Based on the cost of the replacement of the total of 31 posts being $19,075 the amount for 10 post would be 10/31 of that amount, being $6,153.22. That would then have been the likely award made if the Tribunal had found Mr Casey in breach of his duty of care.

Remoteness of damage

If Mr Casey had been in breach of his duty of care in regard to the posts it would have been on the basis that he had not painted them and the purpose of the painting of the posts is clearly to prevent corrosion in accordance with the 1992 Duragal Painting Guide, the requirements relate to the corrosion life of unpainted Duragal and if the posts are in certain climatic situations painting is required to prevent early corrosion of the posts. The fact that over time the posts have rusted would be a foreseeable consequence of the breach of duty and therefore the damage would not have been too remote.

Defences raised by Mr Casey

Mr Casey has raised two defences – the Limitation of Actions Act 1974 and contributory negligence. As mentioned above those claims of Ms Waid which relate to Mr Casey not conforming to the contract where there is no allegation of damage are governed by the contractual limitation period. This period is 6 years from the date on which the cause of action arose[21]. In regard to breach of contract this is the date of the occurrence of the breach of contract, as the house was built in 1995 that period would have expired in 2001 in respect of claims where Mr Casey has not complied with the terms of the contract and those are statute barred. This covers the claim in respect of the handrails, the stairs, the depth of the posts, the bracing and their width (in so far as they relate to contractual claims).
[21] Section 10(1) of the Limitation of Actions Act 1974.
Mr Casey also alleged that the rusting of the posts was discoverable more than 6 years before the claim was made. On the basis that it was not a hidden condition and would by the nature of rusting and cracked footings have been observable more than 6 years ago and that on the evidence of Mr Hanson there was an awareness of rust on the posts in the late 1990s.
Ms Waid alleged that the rusting of the posts was a hidden condition which commenced in the concrete and that she could not see the rust on the posts as it was covered by the paint. The Tribunal has not accepted that the rust commenced in the concrete and it is clear that the homeowners were on notice from the late 1990s that the posts were subject to rusting.
The claim in relation to the posts is not a contractual claim and though the same limitation period of 6 years applies it applies from when there has been loss or damage suffered by the applicant. If the Tribunal had have found that Mr Casey was in breach of his duty in preparation of the posts it is likely that the Tribunal would have found that the limitation period commenced in the late 1990s when the first damage to the post was notified to the builder.
By its very nature rust is an ongoing problem and once it was ascertained that the posts were subject to rusting a right to claim would have accrued. What has occurred here is not a new defect in the posts but the result of the underlying defect of the posts, which is them being subject to rusting.
The other issue raised by Mr Casey was contributory negligence on behalf of Ms Waid. Ms Waid is required to have taken all reasonable steps to mitigate her loss consequent upon Mr Casey’s breach if one had been found. Ms Waid has raised issues about her personal health and inability to detect the rust in question. The test though is one of reasonableness and these personal factors must be discounted. The evidence from Mr Mayer and Mr Mitchell was that rusting to the extent of the posts here would have been visible for some years at least and there was maintenance which could have been undertaken by Ms Waid to mitigate the damage to the posts.
Mr Hull stated in his oral evidence that “maintenance is imperative on any property to inspect and monitor, that it was highly unlikely not to notice rust problems and a little bit of rust was only going to get worse if untreated”.
Mr Casey raised issues about the animals which Ms Waid kept at her property including dogs and ducks. These animals may produce acidic wastes which can contribute to rust. There was no evidence in terms of an analysis of any of the posts and footings to support this and as such it would not have been accepted by the Tribunal.
Having regard to the fact that the posts were known to be subject to rust many years before it would be reasonable that they were regularly inspected and that any rust which was apparent was dealt with at that time. It is not a question of whether or not Ms Waid noticed the rusting but whether the hypothetical reasonable person would have.
On the basis if there had been a breach by Mr Casey of his duty of care any award to Ms Waid would need to have been discounted by an amount attributable to her contributory negligence.

Order

While it is clear that there has been damage suffered by Ms Waid in relation to the posts supporting her house the Tribunal can only require Mr Casey to compensate her for that loss if there has been a breach of his duty to her. In this case the Tribunal has found that Mr Casey did not breach his duty of care and is therefore not liable to compensate Ms Waid in regard to the cost of restumping her house.
In regard to the other claims they are either out of time as being for breach of contract, the handrails and stairs or there was no allegation of damage suffered to support a claim in negligence, the depth, bracing of and width of the posts. There was insufficient evidence of any negligence in regard to the whirlybird.
The application is dismissed.