Zheng v Ianni and Ors (No.3)

[2021] NSWDC 521

District Court

New South Wales

Medium Neutral Citation:

Zheng v Ianni & Ors (No.3) [2021] NSWDC 521

Hearing dates:

13, 15-17, 20, 22-24 September 2021

Date of orders:

30 September 2021

Decision date:

30 September 2021

Jurisdiction:

Civil

Before:

Abadee DCJ

Decision:

See paragraph 286

Catchwords:

TORTS – negligence – plaintiff, as a contractor, suffers personal injury after falling through a void from upstairs bathroom on a construction site in April 2018 – claim against builders who contracted with owners to provide construction works – primary builder alleges the owners denied him access to site prior to the plaintiff's accident from December 2017 – son of the builders continues to perform works  on construction site after December 2017 – agency – ostensible authority – whether builders held out their son to the Owners as a builder working for the benefit of their business – whether any representation of authority withdrawn after December 2017 – whether duty of inquiry cast on owners about son's capacity – whether builders, as occupiers, owe plaintiff duty of care even after they personally cease works in December 2017 – whether any such of duty of care is non-delegable –vicarious liability – whether builders vicariously liable for negligence by their son

Legislation Cited:

Civil Liability Act 2002 (NSW) ss 5B, 5C, 13, 15

Home Building Act 1989 (NSW) ss 12, 13, 18

Law Reform (Miscellaneous Provisions) Act 1946 (NSW) s 5

Work Health and Safety Act 2011 (Cth) s 274

Cases Cited:

Australian Safeway Stores v Zaluzna (1987) 162 CLR 479

Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520

Colonial Mutual Assurance Society Ltd v Producers & Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41

Complete Scaffold Services Pty Ltd v Adelaide Brighton Cement Ltd [2001] SASC 199

Crabtree-Vickers Pty Ltd v Australian Direct Mail Advertising & Addressing Co Pty Ltd (1975) 133 CLR 72

DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423

East Asia Company v PT SatriaTirtatamaEnergindo [2019] UKPC 30; [2020] 2 All ER 294

Freeman & Lockyer v Buckhurst Park Properties (Magnal) Ltd [1964] 2 QB 480

James Hardie & Co v Seltsam Pty Ltd (1998) 196 CLR 53

Kirkv Industrial Relations Commission of NSW (2010) 239 CLR 531

Kondis v State Transport Authority (1984) 154 CLR 672

March v Stramare (E & M H) Pty Ltd (1990) 171 CLR 506

Monaghan Surveyors Pty Ltd v Stratford Glen-Avon Pty Ltd [2012] NSWCA 94

Northern Sandblasting Pty Ltd v Harris (1997) 188 CLR 313

Olsson v Dyson (1969) 120 CLR 365

Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451

Pioneer Mortgage Services Pty Ltd v Columbus Capital Pty Ltd [2016] FCAFC 78

Price v Spoor [2021] HCA 20; (2021) 95 ALJR 607

Prince Alfred College Inc v ADC (2016) 258 CLR 134

Ryder v Frohlich [2004] NSWCA 472

Rylands v Fletcher (1866) LR 1 Ex 265

Scott v Davis (2000) 204 CLR 333

Simpson Design Associates Pty Ltd v Inspector Ching [2011] NSWIRComm 7

Sweeney v Boylan Nominees Pty Ltd (2006) 226 CLR 161

Taylor v Johnson (1983) 151 CLR 422

The Owners – Strata Plan No. 51077 v Meriton Apartments Pty Ltd [2014] NSWSC 129

Wallace v Kam (2013) 250 CLR 375

Woodland v Essex County Council [2014] AC 537

Zheng v Ianni & Ors [2021] NSWDC 492

Zheng v Ianni & Ors (No.2) [2021] NSWDC 511

Texts Cited:

Bowstead & Reynolds on Agency (22nd ed, electronic version, Sweet & Maxwell)

Fleming’s The Law of Torts (10th ed, electronic version, Thomson Reuters (Professional) Australia Pty Ltd)

J D Heydon, Heydon on Contract: The General Part (LexisNexis, 2019)

Sir Anthony Mason AC KBE, 'Themes and tensions underlying the law of contract' in G Lindell, The Mason Papers (The Federation Press, 2007)  

Category:

Principal judgment

Parties:

Buzhong Zheng (plaintiff)
Najib Daoud (third defendant)
Leila Daoud (fourth defendant)
Fred Daoud (fifth defendant)

Representation:

Counsel:
Mr J Phillips SC with Mr L Robison for the plaintiff
Ms F Sinclair for the third and fourth defendants
No appearance for the fifth defendant

Solicitors:
MGL Lawyers for the plaintiff
George Khoury & Co for the third and fourth defendants

File Number(s):

2019/00181425

Judgment

BACKGROUND

1. On 12 August 2018 the plaintiff (Mr Zheng) was working in the bathroom on the first floor in residential premises at Drummoyne, grouting the wall tiles, when he lost his balance on a step ladder, fell through a void (which was later to become a window and which had been covered with plastic) and suffered physical injuries after plunging about three metres to the ground below. These included injuries to his brain, a lacerated spleen, neck and lower back injuries and a fractured pubic bone. The accident occurred when the residential premises were partly a construction site.

2. On 11 June 2019, Mr Zheng sued the first and second defendants (Mr Frank Ianni and Ms Caroline Piraino-Ianni, who said she preferred to be called Ms Piraino), as the owners of the site at Drummoyne (the ‘Owners’), and the third and fourth defendants (Mr and Ms Daoud), being the identified builders in the contract for construction works ^[1] (the ‘Builders’), for damages for personal injuries. He also sued a fifth defendant (Fred Daoud, son of Mr and Ms Daoud). By his statement of particulars, he made claims for out of pocket expenses, domestic assistance, past economic loss and future loss of earning capacity.

   1. The fourth defendant was not actively involved in building work, but was joined on the basis of being one of the business owners through which the builder performed work. Henceforth, unless indicated otherwise, when reference is made to ‘the Builders’ in relation to conduct the reference is to the conduct of Nick Daoud

3. His proceedings against the first and second defendants settled, through which the Owners obtained a consent judgment in their favour. Mr Zheng obtained a default judgment against Fred Daoud, with damages to be assessed. The plaintiff’s proceedings against the Builders remain on foot. The particulars of his action in negligence against the Builders essentially amount to the assertion that, in various ways, they (too) failed to take reasonable steps which would have prevented the plaintiff falling through the void.

4. The Builders, whose Counsel emphasised are now both retired and are pensioners, dispute liability. They say that they had no dealings with Mr Zheng; and that they had no control over who entered or worked on the construction site. Indeed, they say that Nick Daoud had been ordered by Frank Ianni to leave the site in December 2017 after which he ceased performing any works. The Builders say that if they were negligent at all up until the time (in December 2017) that they ceased work, it was the conduct of the fifth defendant (Fred Daoud) and even the Owners themselves, which severed any causal connection between their negligence and the plaintiff’s injuries. They say that Fred Daoud (with whom they apparently became estranged from around December 2017) was not their employee, and they provided no authority to him to perform labour work on behalf of their business.

5. In response, Mr Zheng says that because of the relationship between the third and fourth defendants and the fifth defendant, the third and fourth defendants were vicariously liable for any negligence of the fifth defendant. Accordingly, he says, the third and fourth defendants cannot rely upon any conduct by the fifth defendant as severing any causal connection between the plaintiff’s losses and their responsibility.

6. The Builders did not bring any cross-claim for contribution or indemnity against the fifth defendant (or vice versa), on the basis that they were joint tortfeasors, under s 5(1)(c) of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW). This means that in the event that the Builders are found to be liable to the plaintiff, the Court is not required to consider any comparative culpability or causal contribution that the Builders and Fred Daoud, respectively, had in respect to the injuries and losses suffered by the plaintiff. Nor did they seek contribution against the first and second defendants before the plaintiff settled his claim against those defendants, which thereafter precludes the Builders from seeking contribution against the Owners^[2] .

   2. James Hardie & Co v Seltsam Pty Ltd (1998) 196 CLR 53

7. The ultimate liability issue, from this overview, is whether Nick and Leila Daoud are jointly liable, with Fred Daoud, for the losses and injuries Mr Zheng sustained. The issue requires consideration of whether Nick Daoud had any on-going responsibility for the condition of the construction site after he left it in December 2017.

8. There is no real controversy about what the plaintiff’s injuries were immediately following his fall, or even how he fell; although there is dispute about his on-going incapacities. What is primarily in issue, however, is who was responsible for the plaintiff’s fall.

CIRCUMSTANCES IN WHICH THE ACCIDENT OCCURRED

Mr Zheng’s evidence

9. Mr Zheng came to be at Drummoyne in April 2018 after responding to a job advertisement placed in a website tailored to Mandarin-speaking people.

10. He went to the site at Drummoyne on 12 April 2018. He had not attended this site prior to this day. When he went there to work, he was not licensed as a tiler. He arrived there at about 7:00am in the morning. He had been driven in a car, with two other men. He recalled seeing two other men of Middle Eastern appearance and a construction site which he estimated was 50% complete. He said he entered the property through the rear.

11. Prior to the accident, he said he received no safety meeting, or instructions as to how to go about work. He said he was told to do tiling. This was initially on the ground floor and that work took a couple of hours. Then he was told to do some grouting in the bathroom upstairs. This he was told by two co-workers. Neither of those co-workers said anything to him about safety on site. Nothing was said about any void in the bathroom covered by any plastic.

12. Mr Zheng said that when he went to the site, he did not take any helmet or any safety equipment with him.

13. When he went into the upstairs bathroom, he saw no warning signs or barriers. His co-workers did not give him any verbal warning of any danger. Mr Zheng said that he started grouting on the wall before working his way up until he confronted what he now knew was a window. He used a step ladder to help him ascend to the area where the void was. There was no barrier across it. He did not recall it at the time, but understood from speaking to someone after the accident, that there was plastic sheeting placed across a void. He reached the second or third step on the step ladder before he lost his balance. He fell towards the void, trying to grab something, but was unable to grab anything. The next thing he knew he had lost consciousness until he woke the next morning in Royal Prince Alfred Hospital.

14. Subject to a qualification, none of this evidence was seriously challenged; and I accept it. The qualification is that there is some doubt about whether he fell unconscious: he apparently told Dr Dalton in July 2020 that he was not left unconscious following the fall.

15. The first defendant, Frank Ianni, said that once he had returned home after learning about the accident, he did not observe any scaffolding outside the void. It was put to him, but he denied, that he made a payment to Nick Daoud for such scaffolding in early January 2018.

16. The second defendant, Ms Piraino, did not see the accident, although she indicated that:

• the place where he fell was consistent with its being from the bathroom on the first floor;

• there was no scaffolding outside the void at the time, although there had been scaffolding weeks and months before.

CASE AGAINST THE THIRD & FOURTH DEFENDANTS

The pleadings

17. There were divergences between the parties’ pleaded cases and their eventual arguments which posed difficulties for the Court. This occurred on both sides.

18. By his pleading, Mr Zheng plainly asserted that the Builders were negligent. In the way that he pleaded the case against them, Mr Zheng contended (paragraph 9) that they were personally responsible (ie directly negligent) for the failure to exercise certain precautions. However, on a strict reading of the pleading, there is no basis in construing Mr Zheng’s pleaded case against the Builders as anything other than a case of breach of a general duty of care owed in general law (paragraph 5); as distinct from a non-delegable duty. Nevertheless, although it would have been desirable for the matter to have been pleaded, Counsel for the Builders did not take this pleading point and even, to some extent, addressed the Court on issues of principles relating to non-delegable duty.

19. Mr Zheng also pleaded (paragraphs 3A and 3B) that the fifth defendant was either an employee, or agent, of the Builders, or had been (independently) contracted by the Owners. This opened the possibility, which the plaintiff subsequently availed himself of, to argue that the Builders were vicariously liable for conduct by Fred Daoud causing injuries to Mr Zheng. But there were no particulars evident in the pleading how Fred Daoud’s ‘agency’ for the Builders arose. Senior Counsel for the plaintiff later explained in his closing argument that the reason for the omission was that the plaintiff was never asked to supply them.

20. By their Defence to the Further Amended Statement of Claim (filed 19 June 2020), the Builders generally put the plaintiff to proof or otherwise denied the allegations. But beyond doing this, the Builders commonly pleaded the following facts:

1. they had no dealings with the plaintiff;

2. they had no control over who entered or worked on the building site; and

3. (although) they were contracted to do the works, they had ceased doing any works and had quit the site before the ‘relevant time’; being when Mr Zheng had his accident.

21. The third defendant separately pleaded that the First Defendant, Mr Ianni, asked him to leave the site in December 2017 and that he then quit the site, as ordered. The fourth defendant separately pleaded that she was never involved in the building operation nor attended the site.

22. It is implicit in the pleaded facts that the Builders accept that they were bound by a contract with the Owners (even if the admission did not necessarily extend to accepting the Owners’ account of the version of that contract).

23. In view of the way that the third and fourth defendants conducted their case at trial, it is pertinent to point out matters which were not pleaded in their Defence. Although there was a reference to the Builders actually ceasing their performance of works in December 2017, the Builders did not plead, in terms, that the contract was terminated in accordance with the terms of the contract, that it was assigned to the fifth defendant ^[3] , abandoned^[4] or that it was novated^[5] in December 2017.

    3. By clause 16 of the General Conditions to the contract an assignment could only occur with the written consent of all parties (not to be unreasonably withheld).

    4. DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423 at 434; Ryder v Frohlich [2004] NSWCA 472 per McColl JA (Hodgson JA and Ipp JA agreeing) at [135] – [137]

    5. In the sense of substitution of the fifth defendant for the third and fourth defendants whilst otherwise preserving the content of the obligations and rights: Olsson v Dyson (1969) 120 CLR 365 per Windeyer J at 388-391; J D Heydon, Heydon on Contract: The General Part (LexisNexis, 2019) ([13.480], [22.170]

24. During the course of Counsel for the Builders’ closing oral submissions, after aspects of the Builders’ pleading were commented upon by me, the Builders applied to amend to plead that the contract was abandoned, frustrated, or terminated by the Builders, but that application was refused^[6] .

The evidence

Circumstances prior to the accident

6. Zheng v Ianni & Ors (No.2) [2021] NSWDC 511.

The third and fourth defendants’ business as builders

25. The third and fourth defendants registered a business in August 2003 and obtained, at about that time, a builders’ contractor licence. The registration of the business was cancelled in August 2018. The third defendant, Nick (more formally known as Najib) Daoud had been a licensed builder for 45 years, with a broad experience in small and big jobs. Nick said that the third defendant, his wife, Leila, was his business partner. Nick said that the fifth defendant, his son Fred, was neither his partner nor employee. Nor was he ever licensed to perform building work.

The owners’ plans for development of their property

26. The first and second defendants owned the Drummoyne property from 2013. The first defendant, Frank Ianni, is a property developer. In December 2014, the first and second defendants lodged a development application (‘DA’) with local council for works to be performed on the property.

27. Frank Ianni said that he put the construction works out to tender. He said he chose the business bearing the names of the third and fourth defendants. He did so as a result of his dealings with Fred Daoud, about whom he had received a recommendation. Frank Ianni was aware that Fred Daoud was the son of Nick Daoud. He met Fred Daoud five or 6 times before signing the contract. He did not meet or speak to Nick (or the fourth defendant) until later on, after the contract was signed. Frank Ianni said that Fred had represented to him that Nick worked with him (Fred) and was good at dealing with neighbours.

28. Mr Ianni indicated, in cross-examination, that there was nothing else, independently from what he was told by Fred Daoud, to indicate Nick’s awareness of the tender process. Nick Daoud did not even come on to the site until after the building contract was signed.

29. In cross-examination, Nick Daoud indicated that he understood what a tender process was, but disputed that he was part of one in connection with the construction works for the Drummoyne site.

Obtaining insurance

30. In March 2016 and March 2017, Nick Daoud renewed annual construction insurance policies through Mecon Insurance (Exhibit 5). For the year 27 March 2016 to 27 March 2017, the limit on the project value was $800,000. For the year 27 March 2017 to 27 March 2018, the limit was reduced to $600,000 (Exhibit 5). Nick Daoud explained that the cover limit was intended to apply to all jobs and not just particular jobs. Thus, it could apply to his works on both the Petersham and (subject) Drummoyne sites.

TGI Homes

31. On 13 June 2016 the entity ‘TGI Homes Pty Ltd’ was registered. It was later deregistered in March 2019. Nick Daoud was the director and secretary, and had a half share ownership. The other half share was held by Ms Gladys Daoud, Fred’s wife (Exhibit 14). Nick Daoud said that this entity was never licensed for construction work and that he had never (knowingly) used it for construction work.

32. Senior Counsel for the plaintiff suggested to Nick Daoud that Fred had worked with him on many projects over the years. Nick Daoud accepted that he had helped him out. When it was suggested that TGI Homes had been utilised (by Fred Daoud), Nick said that this entity did not do any work, but he could not account for any reason for why it was set up. He pointed out that this entity never had any licence or insurance. It did not appear on the evidence that it had any bank statements either.

33. Later, in the factual section looking at events occurring after the time that Nick Daoud ceased work, reference is made to proceedings in the NCAT in which Nick was a party, in which TGI Homes was identified as having a connection (Exhibits S & T).

34. Mr Ianni said that in an application lodged with Council in September 2016 (Exhibit 3), the second defendant (Ms Piraino) had erroneously indicated an application for a construction certificate when it should have been for a certifier. The document recorded the builder as ‘Fred Daoud – N & L Daoud Building’. It also contained a licence number, which belonged to Mr Nick Daoud. Mr Ianni accepted that he did not speak with the third defendant before the form was lodged. This information was supplied to Mr Ianni from Fred Daoud. Mr Ianni accepted that he did not ask Nick or Fred Daoud as to whether he could see the contractor licence. Nick Daoud acknowledged that this document needed to be lodged before the works could start.

Nick Daoud’s initial dealings with Frank Ianni

35. Nick Daoud gave evidence that around September 2016 his son, Fred told him about a friend (Frank Ianni) who was proposing an extension and queried whether Nick was interested in providing a quote. Nick said that he asked Fred if Mr Ianni had got DA approval and recalled Fred showing him the plans. They had a discussion as to whether there were any exclusions. Without, at that stage, seeing the site at Drummoyne, Nick said he calculated an estimate of price over 2 days. He said that he was not aware that there was any tender.

36. Fred arranged for Nick to meet Frank Ianni at Drummoyne. Fred introduced them both. Ms Piraino was also in attendance. Nick Ianni said he recalled telling Frank that he had a rough idea about price and exclusions but was there to look at the site; that he would come back to him with a price. The meeting was short, lasting only about 15 minutes.

37. Two days later, Nick told Fred that he was ready to provide a quote to Frank. Fred used his mobile phone to contact Frank. The call was put on speaker phone and Nick quoted a price of $588,500. Nick said that Frank indicated that he was happy with that price. Nick stipulated the preparation of a contract in the MBA – BC 4 standard version.

The Building Contract – the different versions contended for by the parties

38. The Owners entered into a MBA Head contract with the Builders on 27 September 2016. Mr Ianni asserted that this contract comprised different parts (Exhibit A.1 – A.3). In the main part (representing the standard version) although the builders were listed as the third and fourth defendants, Frank Ianni identified that the email and mobile phone details were supplied by Fred Daoud. Fred Daoud was not a party referred to in Exhibit A.1. However, he inserted many of the details in the contract.

39. Nick Daoud had difficulty accepting that the Owners would likely have interpreted what was recorded as indicating that if the Owners wished to communicate with the Builders by mobile phone they would be ringing Fred Daoud’s mobile number and, further, that if they wanted to communicate by email, they would be sending email communications to an email address apparently associated with TGI Homes.

40. As to another part (Exhibit A.2), this part had been supplied to Frank Ianni by Fred Daoud. It had two distinct documents, titled ‘Reference Document 1’ and ‘Reference Document 2’. Both of these documents were on the letterhead of the third and fourth defendants’ business.

41. Underneath Reference Document 1, the following was written:

“This document shall be attached to and be part of the contract for the above mentioned project (a reference to the Drummoyne site) and will take precedence over the plans and other documents attached and part of the contract of works”

42. Reference Document 1 specified, as subject matter, insulation, air conditioning, pool/plant room, water storage tanks and contractual exclusions. Mr Ianni accepted that Nick’s signature was not on this part of the contract; but only Fred’s. But he insisted that the contract was with Nick Daoud. He accepted, however, that he did not discuss the content of the contract with Nick. Nick Daoud said that he was the effective author of this document, but had Fred type the information into the document; Fred having the use of a computer which Nick did not have. Nick had seen the plans for the contract by this time. In the document that was in evidence (Exhibit A.2), the initials of Frank Ianni were placed on this document. Fred brought this document back to Nick. Nick applied his signature.

43. Nick Daoud was referred to part of Reference Document 2, which Frank Ianni had initialled and Nick identified Fred’s signature. It was titled ‘Reference Document 2’ (dated 25 September 2019). Unlike Reference Document 1, there was no statement that it was “part of” the contract, but there was a statement that:

“This price (ie $140,000 plus GST) shall be included as part of the HEAD CONTRACT (an expression not defined) with. (sic) the following works to be included.”

44. It covered subject matter such as ‘Stairs’, ‘Painting’, ‘Tiling’, ‘External blinds, ‘Fencing and decking’. It stipulated a price of $140,000 (plus GST). Nick said he knew nothing about this document. He disputed that his signature or initials were placed on the page that referred to the price. Whilst he accepted that, to some degree, some of the work described had been performed whilst he was on site until December 2017, he said a great deal of it was not. But I consider that he did apply his signature, even if he did not recall doing so.

45. Exhibit A.3 concerned a table of allowances for Prime Cost Items. Nick Daoud was not asked to give evidence about this document.

46. Nick Daoud kept the original version of the contract, at least to the extent that it featured the MBA standard version (Exhibit 12) which he said had been sent to him by Fred Daoud. Nick gave evidence that, unlike the version of the contract propounded by Frank Ianni, his version did not contain the Special Conditions (appearing on p 14). As indicated, he did not accept that the part of the contract included Reference Document 2. The only special condition in Mr Ianni’s version (Exhibit A.1), which stated:

“THE BUILDER MUST OBTAIN FINAL OCCUPATION CERTIFICATE TO ACHIEVE PRACTICAL COMPLETION”

47. Nick’s evidence about this omission from his version of the contract was unchallenged.

48. Frank Ianni identified both the printing of his name, and signature, and, on its face, Fred Daoud’s name was handwritten underneath this condition. Frank did not identify the signature alongside the printing of Fred Daoud’s name.

Preparation for commencing the works

49. On 10 October 2016, an Icare policy of insurance was taken out by the third and fourth defendants (Exhibit 6). It identified “N & L Daoud” as the persons carrying out the work (no reference was made to Fred Daoud) and listed their licence number. The contract sum quoted for the work on the project was $588,500. Nick said in his evidence in chief that he did not show Icare the document ‘Reference Document 2’ (referring to the additional sum of $140,000 plus GST), given his ignorance about its existence.

50. After he obtained the insurance, Nick Daoud paid a short visit to the Owners home.

51. He gave Frank a copy of the home warranty insurance and Frank indicated that he could start work any time.

52. Mr Ianni said he recalled the work commencing from 13 October 2016. Nick Daoud said that when he commenced works on 13 October, he was by himself. He recalled meeting Frank (but not Ms Piraino). Before this occurred, Mr Ianni paid money ($7,000) into the third and fourth defendants’ account to enable the Builders to obtain Home Warranty Insurance.

Comparing the involvement of Nick and Fred Daoud in performing the building works from October 2016 to December 2017

53. Mr Ianni could not recall whether Fred Daoud turned up on the first day after it was put to him that he did. Mr Ianni said he thought it was “possible” that he did so. It was suggested to Mr Ianni, but he did not recall, that Fred was instrumental in placing a padlock on the gate out the back of the house.

54. Nick Daoud said that he was on the site daily (Monday to Friday and Saturday mornings) from the mornings (generally 7:00am to 7:45am) to the afternoons (4:30 to 5:00pm) and the works progressed for a period of about 14 months. He said that it was he who unlocked the gate of the fence closing off the site at the rear of the property each morning and it was he who locked it later in the day. He later said in re-examination, that he kept the key to the padlock on the gate out the back; not giving copies of the key to Frank Ianni or Fred. But when he left the site in December 2017, the gate was open. He accepted that, for a time, when he was commencing the works at Drummoyne, he was also completing another project, at Petersham, although by October, this was at the ‘finishing’ stage; and to the extent that he attended the Petersham site, he said he did so for brief periods (not exceeding half an hour) to speak to the workers.

55. Frank Ianni said Fred Daoud introduced Nick on site. Mr Ianni accepted that he saw both Nick and Fred Daoud on the construction site. He said that he saw Fred on most days, but perhaps not immediately; Mr Ianni was under the impression that Fred (and Nick) were also working on at least one other site (at Petersham). In this sense, he was joined by Ms Piraino.

56. The second defendant, Ms Piraino, recalled meeting Nick Daoud before the contract was signed (in September 2016). She recalled observing Nick Daoud more often in the initial stages of the work, until he was joined by Fred Daoud; and then, from 2017, it was “more” Fred. Ms Piraino indicated that from the commencement of the construction works (13 October 2016), she was off work (looking after her baby), before she returned to work, part time in March 2017; before returning full-time in November 2017. She recalled that Nick attended the site until he was unwell; that he came back to the site (for a time) but then did not come back at all. She could not recall whether she saw him again after December 2017. She did not appear to substantially differentiate the amount of time that Fred was on the site before and after 2018.

57. Nick Daoud disputed that Fred was his “employee” up to the time he ceased performing works in December 2017 and said he reached no agreement with Fred as to the terms for which he would pay him any money. Nevertheless, he accepted that Fred did attend the site to perform casual labour and he said that for such work, he paid him. He said that there was no fixed pattern to when Fred would work: it might be once or twice a week; or perhaps once a fortnight. But Nick said that Fred was not on site every day. The ‘payments’ he made to Fred were ad hoc: sometimes he paid him in wads of cash: sometimes in the amounts of $500 or $1,000 (or perhaps less); sometimes he paid Fred’s bills for living expenses; sometimes he even contributed to school fees for Fred’s children.

58. Nick Daoud was challenged about his evidence of the frequency with which Fred worked on the site and his firm denial of the characterisation of Fred as an employee of his business. Nick accepted that he worked only on a casual basis. In 2016-17, other than the times that he was on site (at Drummoyne or Petersham), Nick said that he did not know what Fred was doing. Nick was referred to a tax return of his (Exhibit O) which did not refer to any payments to Fred; which was consistent with his saying that he only paid Fred in cash. He disputed paying Fred, distinctly, in relation to the latter’s organising the contract or for any tender. It was suggested that the ad hoc payments that Nick said he made to Fred were mere ‘pocket money’ and that, rather, the payments Fred received, directly, from the Owners, represented the true method by which he got paid for his labour services for the benefit of the Builders.

59. At Nick’s direction, following consultation with Frank Ianni, Nick said that Fred prepared tax invoices on his computer (Nick not having a computer himself). Nick said that he supplied information to enable Fred to prepare invoices on the basis of a notebook (which notebook had been left on site after late December 2017). This arrangement appeared to be satisfactory: Nick said that he did not recall any issues about payments of other contractors.

60. Frank Ianni’s recollections about the extent of the two Daouds’ involvement were very different. According to him, as the works were being performed from late 2016 and through to the end of 2017, Fred Daoud was more actively involved than Nick. Frank Ianni recalled that Nick was merely observing the works. Fred was observing as well, but also actively involved in joinery, carpentry and roofing. Frank Ianni acknowledged that subcontractors were engaged. To the extent that Frank Ianni observed them interact, he considered that Nick and Fred appeared to get along.

61. A large bundle of email communications sent to and from Frank Ianni and the email address nominated in the contract was in evidence (Exhibit E) although email was not the only means of communication between them: they both corresponded verbally and by text. These emails were sent to the email address as was contained on the standard version part of the contract (Exhibit A.1). In none of the emails sent by Mr Ianni were they ever addressed specifically to Nick. To the extent that they were expressly addressed to anyone at all, it was only to Fred. Mr Ianni justified limiting his email communications to the Builders in this way because this was the email address identified in the contract. He was not inquisitive about the fact that, notwithstanding that the third and fourth defendants’ names were on the building contract (and associated insurances and other documentation), the email address was [email protected]. Although he acknowledged that TGI Homes was not referred to in the contract, he understood that the email address indicated that it was to be a ‘correspondent’. He was indifferent to whether Nick had oversight over the email communications sent to that email address: as far as he was concerned this was a matter between Nick and Fred Daoud. Similarly, he was not inquisitive when he received directions to change the account details into which he transferred payments.

62. Mr Ianni was referred to two invoices from contractors (Saba Aluminium and John M Excavation), dated 10 November 2017 and 16 November 2017, respectively, which misstated the names of the builders: reference was made to TGI & Co or TGI Homes.

63. As to his understanding of Fred’s status, Mr Ianni said that he did not concern himself with the question whether Fred was an employee of the third and fourth defendants. In her evidence, Ms Piraino characterised Fred as the ‘spokesperson’ for the builders; who had arranged for the entry into the contract.

Payments to the builders

64. Payments were made by the Owners to the Builders into their bank account as and when Nick issued invoices. Nick said that his business did not receive any cash payments from the Owners. When shown a document indicating cash payments to Fred (Exhibit C) he said he was unware that the Owners had made cash payments to Fred. Nor was he aware of the Owners paying additional monies identified in Exhibit C. It was put to Nick, but Nick denied, that the cash payments made by the Owners to Fred represented, in effect, value for the construction work that Fred had rendered on the subject site and that when the amounts in Exhibit C tallied up, they went close to the sum of $122,000 which Nick said that he expected to continue to receive under the contract (assuming the works would be completed) at the point when he had ceased his involvement in December. Nick maintained that such monies as Fred received from the Owners resulted from a deal Fred made with them.

65. On 1 December 2017, the Builders received what turned out to be a final payment into their bank account. By then, they say, they had received the sum of $466,500 and the sum of $122,000 remained to be paid.

66. A bank statement indicated that Nick Daoud paid a sum of $1,000 on 7 December 2017 ^[7] . He said that this was for scaffolding.

    7. Exhibit Y, p 920 of volume 2 of Court Book

67. All of the invoices which Frank Ianni paid were in evidence (Exhibit B). Frank Ianni said that Fred Daoud had provided them to him.

68. Mr Ianni was referred to separate copies of handwritten invoices with detailed handwritten annotations added by him (Exhibits D & E). He identified that the former document indicated EFT payments he had arranged to the account of the third and fourth defendant. He identified that the latter document reflected separate cash payments he made to Fred Daoud.

Circumstances in which Nick Daoud ceased performing work from mid-December 2017

69. Under cross-examination, Mr Ianni was asked about his dealings with Nick up to December 2017. He could not recall having any disagreement, or argument, with Nick. He said he was content with the latter’s work. He did not recall Nick raising any issues with him. Mr Ianni did recall, however, expressing his opinion to Nick that he was old and queried why he was working (he did not recall the response). Mr Ianni said he did not know why Nick Daoud did not return to the site after December 2017; other than Fred telling him that Nick was “not well”. Nick had never himself indicated to Mr Ianni that he was unwell and Mr Ianni did not directly inquire of Nick of his state of his health even though he had his telephone number. It was put to him, but he denied, that he made no inquiry since he only wanted Fred to do the work.

70. Ms Piraino similarly could not recall any argument, or disagreement, with Nick Daoud (or Fred Daoud); though did say that she was concerned about the delivery of the works; even within a month or two of their commencement.

71. Nick Daoud said that from the period in which he was engaged in the works, he was not ill. Further he said he did not tell Frank Ianni or Fred Daoud that he was ill. Up to December 2017, he considered that the works had progressed satisfactorily: Frank Ianni had not raised issues; or complained that the project was over budget or delayed. Nick Daoud said he believed that, up until this point, the Owners were happy with the state of the works.

72. Nick Daoud gave evidence that in or about the middle of December 2017, he was in his car parked outside the site. He recalled that Frank Ianni approached the car and after Nick wound down his window, Frank said to him (materially) “You go home. I don’t want you to come on to the site any more. I don’t want you to complete the works any more” and then walked away. Nick Daoud said he became very upset and drove himself home, and conveyed what had happened to his wife. He also said that the next day, he rang Fred and conveyed his account of the conversation with Frank. After doing so, Nick said, Fred did not say a word, and terminated the call.

73. Nick Daoud said he did not ask Fred to continue the work on the Drummoyne site and Fred did not ask him if he could continue. He said he did not authorise Fred to work since he did not have a contractor’s licence. He said that he had not actually seen Fred since the middle of December 2017; although he accepted that he had spoken to him by phone a couple of times and exchanged texts. Nick did not, however, elaborate on the reasons for this falling off in contact with his son.

74. It was put squarely to Nick Daoud in cross-examination that this conversation with Fred Ianni did not occur. Nick maintained that it did. He elaborated, in cross-examination, that after he left the subject site, he had left chattels belonging to him on the site; which he recalled included his notebook, a step-ladder, jackhammer, and hand (held) hammer. He said he did not take any steps later to retrieve those items. It was put to Nick that the reason he stopped doing work at the subject site was because he was devoting his attention to performing work at the other Drummoyne site, in the circumstances touched upon below. Nick responded that the circumstances of his stopping work at the subject site in Drummoyne had nothing to do with anything he did at the other Drummoyne site.

75. Nick accepted that he did not take steps to ‘terminate’ the contract. He said that Frank Ianni never asked him to complete the work, nor wrote to him.

76. Frank Ianni disputed Nick Daoud’s account of the circumstances in which they ended their relationship. Specifically, he denied telling Nick to go home; and that he did not want him to continue to complete the work. He referred to a conversation which he had with Fred Daoud in 2017, in which the latter said that Nick was unwell and was getting older (evidence which was admitted only for proof of the agency issues and not the truth of the content). He denied saying to Nick that he did not want him to come back since he had never asked him to leave in the first place.

69. Frank Ianni accepted that he had not served any notice of termination of the building contract on the third and fourth defendants and was not aware of them serving any such notice against him (and the second defendant). Nick Daoud’s evidence was to the same effect (he did not notify the Owners of his intention to terminate in writing); and he also accepted that he had not sought to assign the contract to Fred.

70. Mr Ianni did not know whether part of the price for the works remained unpaid after Nick left. He considered that all requests for payment had been honoured. He considered that, at the time, about 60-70% of the works were complete.

71. Asked why he did not pursue the Owners for the remaining $122,000 which he estimated was owing to him under the building contract, Nick Daoud said that he thought that this amount would only fall due after he had completed the works; and that this did not happen. This, he explained, was why he brought no cross-claim for balance of the contract price in the Owners separate proceeding (in the NCAT) against him.

72. Nick Daoud said that at the time he left, there was scaffolding on the property. He was challenged on this evidence, but he adhered to it. It was suggested to him, and he agreed, that other alternatives might have been deployed, such as affixing ply board or displaying warning signs in the vicinity. He mentioned that harnesses were available for workers (if they did not themselves bring them on to the site), but he could not recall any ‘anchor’ points to anywhere in the upstairs bathroom from where Mr Zheng fell. He thought that the stage had not been reached (when he left) when they may have been required. He had no real recollection of any regular practice of safety meetings. He did not tender any written safety rules that he applied whilst he was on site.

Performance of works from early 2018

The Builders’ sign falls off

81. Nick Daoud identified a sign (Exhibit 8) which was affixed to the gate enclosing the site. He said he understood that the display of the sign was a Council requirement. As well as identifying the names of the builder, the contract licence number and ABN, the sign also contained mobile phone and landline phone numbers. Nick Daoud explained that this sign was knocked down by a truck driver 6 or 7 days before he finished performing works in mid- December 2017; that he was proposing to restore the sign but did not do so before he finished the works. He was unaware whether anyone else had put it back.

82. Mr Ianni was asked whether he was aware that a sign erected on the construction works which indicated the Builders’ name and licence number was damaged in December 2017. He responded that he was unware of this. He also said he was unaware whether it had been altogether removed in May 2018; although he believed that it must have been removed after a completion certificate was obtained.

83. Mr Ianni denied taking over the construction works as ‘owner builder’ from mid-December 2017. He also denied the proposition (premised upon his telling Nick to leave the site and not return) that his decision to do so was based upon his being nervous about the costs of the works in late 2017.

84. On 18 December 2017, the fifth defendant (Fred Daoud) sent an email ^[8] to the first defendant (Frank Ianni) asking the latter to pay the former’s invoice for delivery of what appeared (from the title to the email) to be a steel alfresco to the Drummoyne property.

    8. Exhibit E, p 999 of Vol 3 of the Court Book

85. On 19 December 2017, Fred Daoud sent another email to Frank Ianni ^[9] . The email confirmed that plasterers were onsite working, but the main purpose was to request payment of an invoice ahead of delivery to occur on 21 December 2017.

    9. Exhibit E, p 1000 of Vol 3 of the Court Book

86. Mr Ianni accepted in cross-examination that other contractors came on to the site – but not Nick. He accepted that there was a need for concreting, work on the windows, bathrooms and plaster boarding.

87. Ms Piraino accepted that she had not seen Nick Daoud on the site in the months leading up to the plaintiff’s accident. She recalled asking him whether he was ok at one point and Nick responding that he was tired.

88. On 28 December 2017, Fred Daoud sent a further email to Frank Ianni ^[10] . The subject of the email was a request to transfer payment to a ‘new account’. The email attached a tax invoice dated 29 November 2017. It purportedly was on the letterhead of the third and fourth defendants. The Builders say that they did not authorise the invoice. Pertinently, the EFT details were for an account solely in Fred Daoud’s name.

    10. Exhibit E, pp 1002-1003 of volume 3 of the Court Book

89. Frank Ianni accepted that Fred Daoud had directed him to pay money into a different account. He also accepted that he continued to make certain cash payments to Fred Daoud. Ms Piraino was unaware of Fred’s request to make payment into a different account; and did not recall seeing the email of 28 December 2017.

90. It was put to Ms Piraino, but she disagreed, that from Christmas 2017, Nick Daoud had nothing more to do with the site.

91. On 29 December 2017, Fred Daoud sent a further email to Frank Ianni ^[11] , which attached what appeared to be a requested written variation relating to rock excavation for a (water) tank, alfresco and pool, with supporting documentation.

    11. Exhibit E, p 1004 of vol 3 of the Court Book

The Owner’s concern about delay

92. Nick Daoud gave evidence that on or about 15 February 2018, he received a text message originally crafted by Frank Ianni, which he believed had been on-sent to him by Fred (Exhibit 15). The text was admitted over the objection of the plaintiff. The content of the text was consistent with other evidence, shortly to be referred to, regarding the Owner’s concerns about delays in the completion of the works. The text message, by its terms, complained of delay and foreshadowed an approach to the NCAT. Reference was made in the text to “Najib” not having been on the job for at least 4 months and the author of the text’s impression that Fred Daoud had seemingly been “doing the job on his own”.

93. On 27 February 2018, Fred Daoud sent an email to Frank Ianni ^[12] , in which he requested a progress payment in order to permit him to perform works, relating to the “doors, jambs, then skirtings” and to pay for his labour. He indicated that he would get skylight framing and bathroom ceiling framing and the underside of boxes done. He resupplied EFT details which had appeared in the invoice that he sent to Frank Ianni on 28 December 2017.

    12. Exhibit E, p 1017 of vol 3 of the Court Book

94. In response, on the same day, and amongst other things, Mr Ianni asked Fred Daoud to provide him with an outline of how Practical Completion would be achieved, based on the outstanding items of work and the funds remaining and attached a spreadsheet ^[13] . He invited discussion the next morning. When it was suggested that Mr Ianni was corresponding (only) with Fred, Mr Ianni said that his communication was being sent to the third and fourth defendants. He accepted that he had received no direct communication from Nick Daoud himself.

    13. Exhibit E, pp 1102-1103 of vol 3 of the Court Book

95. Mr Ianni accepted that, from February 2018, he took no steps himself personally to keep the construction site safe. He indicated that he did not regard that as his responsibility; having also denied that he was a builder owner at that point. He maintained that the third and fourth defendants were the builders and that the fifth defendant was ‘directing’ traffic.

96. Ms Piraino gave some evidence of works performed by other contractors prior to the accident. She considered that she and Mr Ianni were responsible for works in relation to the kitchen and shower screen after the tiling that was to be performed. She recalled that the kitchen was completed about the middle of 2018 (after the accident occurred) and that this job was being performed by Mr Ianni’s brother. She accepted that several workers were on the site, from February 2018 up to the date of the accident; although could not recall details of who they were.

97. On 27 March 2018, the Builders’ annual insurance policy (with Mecon Insurance) expired. Nick Daoud says that he allowed it to lapse as he was no longer working as a builder and his contract with the Owners at the Drummoyne site had ended.

Lead up to the plaintiff’s accident

98. On 11 April 2018, Fred Daoud sent an email to Frank Ianni ^[14] . The subject was ‘tiler payment’ and referred, more specifically, to the tiler receiving $1900, with that amount to come off the contract total. An undated handwritten note was in evidence, identifying Peklo Pty Ltd (which had an ABN) and its bank details [15] .

    14. Exhibit E, p 1027 of Vol 3 of the Court Book

    15. Exhibit E, p 1028 of Vol 3 of the Court Book

99. It was put to Mr Zheng, but he denied, that he received payment ($1,900) from Peklo Pty Ltd, the day before the accident (11 April 2018). It was also put to Mr Zheng, but he again denied, that Peklo Pty Ltd was his employer in performing his work on the date of the accident. Mr Zheng did not recall the name of his ‘boss’; though he recalled meeting him once before the accident. He observed that his boss spoke Mandarin.

100. Under cross-examination, Mr Ianni said that he was unaware that a tiler was attending the site on 11 or 12 April 2018.

101. Ms Piraino was referred to text messages which she had with Fred Daoud from 25 March to 6 April 2018 (Exhibit 11). This indicated Fred Daoud’s awareness that the tilers were to come to the property next week and his passing that information on to Ms Piraino.

102. On 12 April 2018, Ms Piraino said that she did not meet the tilers before they commenced the work. She was unaware whether Fred Daoud was on the site.

103. Mr Zheng never met the first and second defendants, nor had he spoken to or met the third and fourth defendants.

104. Mr Ianni said his wife told him about the work accident. He said he did not ring Nick Daoud; or, for that matter, Fred Daoud.

Reaction to the plaintiff’s fall

105. At 10:57am on 12 April 2018, Nick Daoud received a text message, alerting him to the plaintiff’s fall (Exhibit 16). He believed that it was sent to him by Fred. Be that as it may, the message inquired of Nick Daoud whether he had renewed his insurance. Nick’s response was in the negative. Nick was advised to call his broker.

106. Nick said that he did not engage any tilers, had not met them and did not know who was responsible for paying them. He first knew about the accident when Fred had told him. He recalled Fred requesting that he provide a copy of the insurance policy but responding to that request by telling Nick that his insurance had expired.

Non-disclosure of information

107. Nick Daoud accepted in cross-examination that after he had ceased to perform works himself from December 2017, and before Mr Zheng’s accident in April 2018, he did not:

1. instruct Fred Daoud to desist from using the letterhead of his business (in correspondence with the Owners);

2. inform Frank Ianni that he should ‘take no notice’ of Fred Daoud;

3. inform Fred Daoud or Frank Ianni that the insurance policy he had obtained in connection with the works on the site would expire in March.

Circumstances post-dating the accident

108. Mr Zheng eventually lodged a claim for workers compensation personally (Exhibit 2). It was unsuccessful.

109. Nick Daoud tendered financial statements of his partnership with his wife which indicated, relevantly, a significant drop of in takings and gross profit, between the financial years ended 30 June 2017 and 30 June 2018 (Exhibit 17). Statements of Mr Daoud’s bank account (into which the Owners deposited payments) showed that his Westpac account into which the Owners had deposited monies was in debit for most of the period after January 2018 (Exhibit Y). However, he did have other accounts, being accounts with the ANZ and NAB (Exhibits V and W, respectively). The balance of monies in the NAB account (in the short extract tendered) showed a significant balance from October 2017, but fairly modest activity on the account up to April 2018. The balance of monies in the ANZ account from October 2017 to May 2018 never rose beyond $4,000.

110. On 23 August 2018, Mr Ianni sent a text message to both Fred and Nick Daoud (Exhibit H). The text contained the assertion that the Owners had overpaid the contract price and complained about the Owners’ loss of rent. He gave evidence that his purpose in sending this was to ascertain who the Owners would be reimbursed by for such overpayment. Asked why he sent the text to both, Mr Ianni expressed his opinion (which was treated as such and not as evidence of the truth of the underlying fact) that although Nick was the builder, it was Fred who he was dealing with him on a day to day basis. Under cross-examination, Mr Ianni accepted that, to the extent that the text message referred to a “discussion”, that was only a reference to a discussion that he had had with Fred; and not Nick. He said that Nick did not respond to the text message. When he gave evidence, Nick Daoud denied having had any discussion of any text with Frank, as the text message asserted. Nor did he have any conversation about it. He said he did not respond to it because he considered that he was not involved in the job since December 2017.

111. Also, in August 2018, Mr Ianni rang Nick Daoud. This, he explained, was for the purpose of ascertaining whether Nick Daoud was insured for the plaintiff’s accident. Mr Ianni said that Fred had indicated to him that he had not enjoyed success in finding out about the status of the insurance position from Nick.

112. Mr Ianni was referred, in cross-examination, to the content of an affidavit of Nick Daoud prepared in an NCAT proceeding which he had commenced against the third, fourth and fifth defendants. In particular, he was referred to Nick Daoud’s sworn account of a conversation with Mr Ianni sometime in August, September or October 2018, in which Nick deposed to Mr Ianni referring to the plaintiff’s fall and his (Mr Ianni’s) need for a copy of Nick’s insurance policy.

113. Mr Ianni accepts that it was likely that he asked Nick about the policy. Mr Ianni was then referred to Nick’s response: that he did not have an insurance policy as he (Mr Ianni) had told him (Nick) to go home and had stopped the transfer of money to his account and got the workers to complete the job himself. Mr Ianni denied this part of the account. Mr Ianni said that Nick had told him he had no insurance as he had stopped doing building work anymore.

114. On 3 September 2018, Fred Daoud sent an email to Frank Ianni (Exhibit 10). Its subject was ‘Agreement’. By its terms, Fred Daoud agreed to pay “my share” of monies owed to the third and fourth defendants from the total amount paid over on the contract sum for the building project at Drummoyne. He would pay $16,000 by the first of December. By this, Fred Daoud also agreed that he would “continue” to provide his labour and skills to complete certain enumerated works to the final occupation within the next two weeks.

115. Mr Ianni was cross-examined on this email. He accepted that, by this point, he was anxious about the completion of the works. He did not accept the characterisation of any ‘continuation’ as being a reference to works performed by Fred (alone) since the middle of December 2017. Mr Ianni said that Fred had been working from the beginning. He accepts, however, that he did not speak to Nick about the ‘agreement’ referred to.

116. Ms Piraino said that Mr Ianni spoke to her about the email. She understood from him that the third and fifth defendants had reached some agreement as to monies payable to her and Mr Ianni.

117. On 24 September 2018, a certificate of completion was issued (Exhibit G). This was on the letterhead of the third and fourth defendants and was purportedly signed by Nick Daoud, however he said that he did not affix the signature himself; nor authorised the insertion of his signature; nor the use of the letterhead. Nick Daoud said he was unaware that this certificate had been issued. He disputed that his signature was on it. He did not authorise the issue of the certificate. Indeed, he said that he only saw it during the course of his giving evidence at the trial. In cross-examination, after a large bundle of miscellaneous other documents shown to him apparently indicating his signature towards the end of his cross-examination, Nick identified his signature on the document as his, but he promptly corrected himself during re-examination to say that the signature on that document was not one that he had applied.

118. Mr Ianni said that Fred Daoud supplied him with this certificate, by email at about this time. Asked why he did not ask Nick to arrange for this certificate, Mr Ianni explained that he saw it as Fred’s responsibility. Mr Ianni accepted (somewhat grudgingly I thought) that he had no basis for believing that Nick Daoud had such knowledge of the state of the works so as to permit Nick to certify completion.

119. When she was cross-examined about the certificate of completion, Ms Piraino indicated her understanding that Mr Ianni had spoken to both Nick and Fred Daoud how to progress the works after the contract sum (presumably price) had been exhausted. Even though she thought that Nick was spoken to, she accepted that she did not speak to him herself.

120. Mr Ianni confirmed that part of the settlement of the plaintiff’s claim against him in this proceeding involved his (and his wife’s) payment (on a without admissions basis) of the plaintiff’s costs, being $80,000 (incl of GST).

Other works by Nick Daoud

121. Nick Daoud was referred in cross-examination to his contractor licence which recently expired in August 2021 (Exhibit P) and for which he said, he was awaiting renewal. He said he was also in receipt of Centrelink benefits ($712 per fortnight). Asked why, as a recipient of Centrelink benefits who had considered himself retired from working as a builder he would wish to pay the annual $500 licence fee, Mr Daoud said he kept it as a “hobby”.

122. Nick Daoud said that he had retired after he left works at the subject site in December 2017. It was revealed, however, in cross-examination, that Nick Daoud had allowed an owner (Mohammed Aslam) of other premises in Drummoyne (what I will call the ‘other Drummoyne site’) to use his contractor licence to obtain home warranty insurance in the second half of 2017. Nick Daoud said he provided assistance, which he estimated was half an hour or an hour a week to help with works on the other premises. This involved a partial demolition of part of the property and the construction of certain additions. He estimated that his business derived the sum of approximately $50,000 from such ‘assistance’.

123. It was pointed out to Nick Daoud, on the basis of his tax return and his evidence of receiving ‘progress’ payments for what he did at the other Drummoyne site, that he had performed work into the 2019 financial year. Mr Daoud did not recall doing so.

124. The plaintiff tendered extracts of other bank account statements in Nick Daoud’s name, being accounts with the ANZ (Exhibit V) and NAB (Exhibit W) for the periods 29 September 2017 to May 2018 and April 2018 to October 2018. The ANZ statements indicated that Nick Daoud received certain monies and paid certain monies in connection with work at the other Drummoyne site, and also another construction site at Padstow from October 2017 to February 2018. Fairly read, however, the transactions identified in the bank statements were not very substantial in value; in the sense indicating a massive expenditure of time by Nick Daoud on either of these other sites. Further, the plaintiff made no submission as to what, if anything, could be inferred from the content of those bank statements from February 2018 through to the apparent completion of the works at the subject site in September 2018.

Credit findings

Mr Zheng

125. Mr Zheng gave his evidence through an interpreter. He was very much ‘led’ (without objection) by his Senior Counsel through his evidence^[16] . He was not very forthcoming with recollection of detail. Such inconsistencies as Counsel for the third and fourth defendants identified between his evidence in Court and the history he gave Dr Dalton were not highly material. I regarded him as being honest and generally reliable.

     16. As to the problematic nature of the weight to be accorded to answers to leading questions being raised by an advocate of a client, see Kirk v Industrial Relations Commission of NSW (2010) 239 CLR 531 per Heydon J at [117]

Mr Ianni

126. Mr Ianni impressed me as being an intelligent man with a good grasp of the questions raised of him and an appreciation of detail (the latter possibly attributable to his training and experience as a property developer). He was referred to several spreadsheets he had prepared before and during the course of proceedings, which reinforced my impression of him as being by nature, something of a micro-manager.

127. Nevertheless, very often he embellished his answers with unsolicited explanations, or justifications, which I took to amount to efforts at advocacy on his behalf. I formed the impression that he tried, too hard, to convey the impression that he was ignorant about the goings on, behind the scenes, as between Nick Daoud and his son; for someone of his background. It must have been obvious to him that he was almost exclusively dealing with Fred, but somewhat disingenuously he implicitly suggested that it was likely that Nick was aware of email communications. It was also plain to him that from December 2017, Nick was out of the picture altogether, but he continued to assert a belief that Nick would or could be involved in the actual completion of the works. I had my suspicions about the plausibility of this evidence coming as it did from someone of Frank Ianni’s background.

128. I am somewhat cautious about accepting his evidence unless it is corroborated, or consistent with the underlying probabilities.

Ms Piraino

129. I considered that Ms Piraino was a somewhat defensive witness, more intent on explaining her position but nonetheless regarded her as trying her best to give evidence as honestly as she could and I regarded her evidence as generally reliable, within the limits (which were not insignificant) of her powers of recollection and the extent of her actual involvement in the administration of the works.

Nick Daoud

130. Like all of the other witnesses, Nick Daoud gave his evidence remotely, by audio visual link. Compared to the evidence of other witnesses, technical difficulties sometimes prevalent with this form of evidence were particularly pronounced in his case: there were multiple breaks in his giving evidence on account of those difficulties. A further difficulty was that although Nick considered himself to have sufficient understanding of English to give evidence without an interpreter ^[17] , I considered that his ability to speak and comprehend English was somewhat restricted. It was put to him, and was not vigorously disputed by the witness, that part of the reason for Fred’s assistance with third parties like the Owners was that the he was more fluent or familiar with the speaking and reading of the English language. Often his answers did not correspond with the questions asked. I did not infer that this was necessarily the result of deliberate avoidance in answering the questions; but rather was the result of a diminished understanding of precisely what he was being asked.

     17. Nick Daoud said he was of Lebanese extraction

131. I formed the impression that he was a practical man. He displayed a reasonably detailed grasp of what works were done (until he ceased performing them), and which remained to be done, when he finished performing works. This was consistent with an active oversight and involvement. But he evinced a rather inept capacity for administration, which helps explain why so much of the ‘paperwork’ was delegated to his son. I also regarded his apparent practice in allowing others to use his builder’s licence as foolish, if not reckless. In doing so, he exposed himself to his son acting in a way which may not have coincided with the interests of his business. Nevertheless, I formed the impression that he tried to tell the truth.

132. However, I had significant reservations of the reliability of his evidence. This was partly because of a pronounced lack of proficiency and, I also consider, laxity in administration, which naturally impaired his reliability in his recollections of events. I also consider that he was by nature an emotive man and this sometimes led him to overstatement or exaggeration. Thus I found that he overstated his case to say that he was retired after December 2017 when, more accurately, he continued to engage in relatively minor projects which were consistent with partial retirement and reduced working capacity. I am cautious when assessing his evidence. It was difficult to credit him for the broad statement that he had no idea about the connection between TGI Homes and construction works he had undertaken when the evidence suggested prior practice of his son using that corporate vehicle. It is plainly the case that, for reasons that were not elaborated by Nick Daoud, he is estranged towards Fred Daoud, and this had occurred even before the accident which has given rise to the claims against him. It is not surprising if, through ill-will or bitterness, Nick minimized the contributions to his business made by Fred.

133. I am not able to accept Nick’s evidence without reservation, unless it is corroborated or consistent with the objective facts.

Leila Daoud

134. The fourth defendant did not give evidence. The plaintiff did not, properly in my view, take any Jones v Dunkel point about that circumstance.

Legal responsibility of the third and fourth defendants

The plaintiff’s submissions

135. The plaintiff submitted that at the date of the accident, the third and fourth defendants were occupiers of the subject site. This was indicated by their contract with the Owners and their practical control of it. That being so, as occupier, the third and fourth defendants owed a non-delegable duty of care, arising because of hazardous activity occurring on the site, thereby engaging the principles referred to in Kondis v State Transport Authority (1984) 154 CLR 672 (“Kondis”); Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520 (“Burnie Port”) at 552-4 and Northern Sandblasting Pty Ltd v Harris (1997) 188 CLR 313.

136. In his closing address, Senior Counsel for the plaintiff acknowledged that his argument about a non-delegable duty of care being owed by the Builders was premised upon the Court finding that the Builders continued to exert practical control over the work site even after Nick ceased performing work in December 2017. Mr Phillips SC also acknowledged that his argument that the Builders continued to enjoy practical control over the site depended upon the Court accepting that, from the end of December 2017, Fred Daoud continued to be, or act as, the representative or agent of the Builders, since he had been put in that position by the Builders before 2017 and nothing that the Builders did after December 2017, in terms of Nick’s communications with Frank Ianni, altered that position. The representation made by Nick as to Fred’s authority was broad, or at least not confined: he was the administrator for the contract; indeed he had filled in much of its content (and not just the requisite contact details). It was not overtly significant that Nick was the licensed builder since, by statutory provision, he could rely upon qualified builders^[18] . It was not necessary for Nick to be on site all the time. Both Nick and Fred were engaging in works and when Nick was away, Fred stood in his place. I do not consider it likely that only Nick held a key to the padlock to the fence enclosing the construction site.

     18. Reference was made to the Home Building Act 1989 (NSW) (‘HB Act’), ss 12-13

137. The holding out, that had occurred prior to December 2017, continued after that date. The plaintiff said that the Court should prefer Frank Ianni’s evidence over Nick Daoud as to what occurred in December 2017. The former did not instruct the latter to leave. On the Builders’ case this was an entirely unexpected development. There was no obvious reason for Frank Ianni to ‘sack’ Nick. It was submitted that the circumstance that Nick left and did not return to the site was more plausibly explained by his working on other sites (the other site at Drummoyne and Padstow). Fred Daoud was apparently continuing to do what he had done before.

138. I understood the plaintiff to submit that even if there were, in retrospect, certain matters which might appear suspicious – such as Fred’s direction to Frank in early 2018 to channel further payments made for the Builders to continue to perform the works and Nick’s apparent application of his signature to the certificate of completion in September 2018 – these were not matters which, at those times, would have put the Owners on inquiry as to any change in the level of Fred’s prior authority. On the other hand, what Nick did not do was to take the tangible steps that would have betokened a real change. This was, first and most obviously, taking steps to terminate the contract entered into in September 2016. Secondly, Nick never directly disclosed to Frank any qualifications or withdrawal of Fred’s antecedent authority.

139. That being so, whether or not Fred acted improperly towards Nick in some way, or whether he exceeded any actual authority which Nick had reposed in Fred, did not matter. In accordance with the principles identified in Colonial Mutual Assurance Society Ltd v Producers & Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41, through the continuing works of Fred, the Builders, remained in practical control over the site thereby generating, as occupiers of a site upon which dangerous activities were being performed, a non-delegable duty; or, alternatively, they became vicariously liable for any negligence by Fred from the time that Nick left in December 2017.

140. By their statement of particulars of negligence in their pleading (paragraph 9), the plaintiff did not distinguish the position of the five defendants. But ultimately, it was clear that the plaintiff submitted that the negligent conduct was that of Fred Daoud and that the Builders were responsible for the consequences of his conduct, whether by reason of a failure to ensure that care was exercised by him, or simply because they were vicariously liable for the negligence of their ‘agent’. The plaintiff submitted that the uncontradicted evidence of expert witnesses (who had produced reports for the first and second defendants that the plaintiff relied upon) cited simple precautions that could have been, but were not, taken to prevent the risk of workers falling from the heights. The plaintiff identifies that the risk of harm to a worker falling from a height in the building site was foreseeable and not insignificant and the other considerations in s 5B of the Civil Liability Act 2002 (NSW) (the ‘CL Act’) inevitably pointed to the conclusion that a breach of duty was proven.

141. The third and fourth defendants’ breach of a non-delegable duty, as occupiers, or vicarious liability for Fred’s negligence, caused the plaintiff severe injuries; proven not only by the plaintiff’s own account, but also the evidence of Dr Giblin and local doctors in Auburn.

The Builders’ submissions

142. The Builders disputed the content of the building contract. They generally submitted that the contract was constituted by Exhibit 12 and nothing else. It did not include the ‘Reference Document No.2”. That particular document reflected a separate, or ‘side’ arrangement between the Owners and Fred Daoud, in respect to which Fred received a substantial number of cash payments and whose terms were inconsistent, in some respects, with Reference Document 1. The Builders submit that this ‘side arrangement’ subsisted from the commencement of the works in October 2016 until the works were completed and the nature of the arrangement was reflected in an email between the Owners and fifth defendant dated 3 September 2018 (Exhibit 10). The Builders submitted that Reference Document No. 2 indicated that it was Fred Daoud, not the Builders, with whom the Owners agreed would perform tiling work. The Builders submitted that the Building contract did not include Schedule 4 (the Special Condition clause) and did not include the document which was Exhibit A.3.

143. Although they say Fred attended, from time to time, on the site, the Builders submitted that Fred was only a ‘casual labourer’ doing small jobs which Nick asked him to do; for which Nick paid Fred, in an ad hoc fashion, cash or even the payment of some of Fred’s bills for living expenses (or children’s education). Fred also rendered some administrative assistance in creating documents, such as progress payments. The nature of this assistance was circumscribed. Fred was not their ‘employee’ or ‘agent’ in connection with the works themselves. He had no actual authority to do more and the Builders did not hold out to the Owners that he could do more: the Owners knew that Fred was not licensed as a builder and Nick had supplied Frank Ianni with his business card (substantially similar to the version in Exhibit 21) which contained contact details which were different to the details which appeared in the contract (being Fred’s actual contact details). There was also a sign on the building site itself which identified the Builders, and Nick Daoud’s details (not Fred’s details).

144. The circumstance that Fred engaged in email correspondence (Exhibit E) with Frank Ianni did not assist the plaintiff’s case. Most of the written emails in Exhibit E occurred after December 2017. To the extent that the correspondence preceded that period, it dealt almost entirely, in its subject matter with exclusions or variations to the building contract (the latter being those of which Nick was ignorant) or were otherwise consistent with the ‘side’ arrangement reflected in Reference Document 2. The Owners could not take Fred’s use of the Builders’ logo on email communications to form any reliance upon any representation that Fred was acting to advance the Builders’ interests in those circumstances.

145. If there was any holding out to the Owners about Fred’s authority to represent or advance the Builders’ interests before, the representation was effectively withdrawn or revoked from soon after December 2017 and before the plaintiff suffered his accident. This was reflected in a payment made to the separate account of Fred on or about 28 December 2017 (Exhibit E, pp 1002-1003) and also not restoring the sign to the site bearing the Builders’ names and contact details.

146. Counsel for the Builders submitted that the Court should accept Nick Daoud’s account of Frank Ianni instructing him to leave, and not return to the site, given in December 2017. Pressed by me as to why Frank Ianni would have done this, Counsel attributed his conduct to Frank Ianni’s concern about money and a desire to take over the job and proceed on his own terms.

147. Counsel for the Builders submitted in her closing address that the building contract was ‘abandoned’ if not, ‘frustrated’ even if there was no written termination. Alternatively, it was submitted that Nick himself had terminated the contract on the basis that the Owners had denied him access to the site after December 2017. As indicated earlier, these submissions presaged a late, and unsuccessful, application to amend the Defences in order to plead those facts.

148. But before the application to amend was brought, Counsel for the Builders also submitted that the contract was terminated by reason of the Owners engaging in a transaction inconsistent with the Building Contract, the Owners repudiated the Building Contract, and that this was repudiation was accepted by Nick Daoud when he left the site in December 2017. Termination on the basis of the Builders’ acceptance of a repudiation by the Owners had not been pleaded either. As will become evident later, even if it was fair to the Owners to treat with this non-pleaded argument, I would not have accepted it on its merits as it was far from clear that there was any “inconsistent” engagement which the Owners engaged in.

149. At any rate, Counsel for the Builders submitted that the building works were directed by the Owners (presumably Frank Ianni) in respect to which Fred Daoud supplied his labour and skills. The employer and employee relationship was between them; and did not involve the third and fourth defendants. Fred supplied the Owners with a bank account in his name to receive his payments from 2018; not the Builders. Other workers came on the site, such as the plasterer, concreter and flooring contractors and, unfortunately for him, the plaintiff. As at the date of the plaintiff’s accident, the Builders were not in possession of the site and they had nothing to do with his engagement. It was the Owners, and/or Fred, who were legally responsible for his injuries and losses.

150. The Builders deny any breach, in terms of any direct liability. The Builders say that when Nick left the site in December 2017, it was in a safe condition: scaffolding had been erected around the whole of the site. Had it been in place in April 2018, the plaintiff would not have suffered the injuries he did even if he did all out of the window void.

151. If there was, contrary to their submissions, negligence by the Builders, the causal connection between such negligence and the plaintiff’s injuries was severed. This was said to be the result, individually or in combination, of several circumstances: the entry into a separate agreement between the Owners and Fred Daoud (September 2016, confirmed in February 2018); when Fred Daoud received his first payment from the Owners (October 2016); when variations were made to the Building Contract in respect to which Fred was paid (September 2017).

CONSIDERATION

The contract

152. The Owners came to deal with the Builders through Fred Daoud; whom Frank knew. Fred persuaded Frank Ianni that although he (Fred) was capable of managing the building work, it would be useful for the Owners and himself (he not being licensed) for them to contract with the third and fourth defendants and not Fred.

153. In about 2016, Nick Daoud authorised Fred to arrange for a contract with the third and fourth defendants for the provision of construction works to the Owners, consistently with the drawings and plans which Nick had seen. Fred completed much of the administrative detail, including providing contact details for the Builders (email address) and bank account details. The former was TGI Homes’ email address. Although Nick did not expressly authorise Fred to use the TGI Homes address (or Fred’s mobile phone number), I do not accept that, by his doing so, this exceeded Fred’s authority.

154. Fred’s authority did not extend to binding Nick to the content of the contract even if he was authorised to insert much of the detail and undertook negotiations as to the terms. I find that Nick signed Exhibits A.1 and Exhibit A.2 (‘Reference Document 1’ only) but not Exhibit A.3. He initialled, but did not sign, Reference Document 2.

155. I find that, as Counsel for the plaintiff emphasised, the General Conditions set out the circumstances by which the parties agreed that assignment (cl 16), suspension of works (cl 21) or termination of the contract (cll 28-29) could occur.

156. From the time when construction works commenced, on or about 13 October 2016, until the middle of December 2017, both Nick and Fred Daoud were involved in the performance of the construction works. Their roles differed. Nick Daoud was more of a supervisor of the hired labour; even if he performed some labour himself. He was, nevertheless, fully immersed in what was going on. Fred also performed minor works requested by Nick himself; and was more involved in the administrative sense, of hiring the labour and liaising with the Owners about requirements; including, in particular, the administration of invoices and payments. Such payments were substantially directed for the benefit of the business of the third and fourth defendants, but Fred received his own cash payments in respect to his performance of the works set out in Reference Document 2.

214. The third and fourth defendants did not adduce expert liability evidence in response.

Consideration

217. The issue of breach is regulated by ss 5B (and 5C) of the CL Act.

218. I take the risk of harm to be a person, in Mr Zheng’s position, engaged in grouting tiles, falling through the void and injuring himself. I find this risk to be foreseeable and not insignificant.

219. I accept the evidence, principally from Mr Cauduro, that having regard to the high probability of risk and the grave nature of personal injury arising should the risk materialise, a reasonable person in the fifth defendant’s position would have erected scaffolding to prevent a worker in the plaintiff’s position from falling through the void and on to the ground. There may have been other precautions that could also have been taken, but for present purposes, the absence of scaffolding itself would have been sufficient.

220. Applying the criteria in s 5B, I accept the plaintiff’s submissions that:

1. the probability of harm occurring was high in the absence of scaffolding, but virtually non-existent if it was present;

2. the risk of harm, without the scaffolding was very high, verging on the catastrophic depending upon how the plaintiff fell;

3. the burden of adopting scaffolding was not such as to relieve the Builders of the responsibility of taking this precaution. Accepting Nick Daoud’s evidence, as I do, scaffolding had previously been in place. It had been removed by the date of the accident;

4. the question of any social utility of the activity is not applicable.

221. Fred Daoud was negligent. Since they did not ensure that his conduct was consistent with the exercise of reasonable care and/or would be vicariously liable for his negligence, the Builders are also liable for Fred’s negligence.

Causation

222. Issues of causation are governed by ss 5D and 5E of the Act.

Factual causation

223. I am satisfied that factual causation is established. I infer that Fred was responsible for the removal of the scaffolding that had been left in place, which would have prevented the plaintiff suffering the fall that he did. No other precautions were put in place to prevent the fall. This was something for which Fred was also responsible.

Scope of liability: whether any supervening events

224. The more contentious question is whether the scope of liability element is also satisfied. In this context, it is accepted that arguments about supervening causes or events, as developed under the general law, remains relevant in the normative inquiry which the Court engages in under this requirement (Monaghan Surveyors Pty Ltd v Stratford Glen-Avon Pty Ltd [2012] NSWCA 94 per Basten JA at [70]).

225. Underlying the notion of supervening cause analysis is that it is the voluntary intervention of a subsequent actor which is the true cause of a plaintiff’s loss, even though the defendant’s conduct was an antecedent condition of the loss occurring. The supervening conduct must be both deliberate and voluntary: March v Stramare (E & M H) Pty Ltd (1990) 171 CLR 506 per Mason CJ at 517.

226. Counsel for the Builders submitted that if, contrary to their primary submission, there had been any negligence by the Builders when their contract with the Owners was abandoned (or terminated) in December 2017, it was severed by supervening events. This was the involvement of Fred Daoud and other sub-contractors to complete the works left over from December 2017; which works were done without the Builders’ awareness or supervision.

227. In my view, to the extent that the third and fourth defendants cite conduct of the fifth defendant, this is one of those instances^[30] where the ‘scope of liability’ element is coextensive with the findings that I have made about the third and fourth defendant’s legal responsibility for Fred’s conduct. If, as I have found, they were legally responsible for his acts or omissions, after Fred ceased working in December 2017, it makes no sense to say that any causal connection between their breach of duty was severed by his conduct in the premises stipulated.

     30. Wallace v Kam (2013) 250 CLR 375 at [26]

228. This conclusion makes it unnecessary to address the fine distinction submitted by Counsel for the Builders, by reference to a decision she relied upon^[31] , between a party’s omission to act and a contractor’s grossly negligent conduct.

     31. Simpson Design Associates Pty Ltd v Inspector Ching [2011] NSWIRComm 7

229. Beyond the suggestion of a ‘side agreement’ with the fifth defendant, there was no articulation as to how anything done by the Owners severed a causal connection^[32] . However, once it is found, as I have determined, that the Builders remained responsible for Fred’s conduct after December 2017, it is immaterial whether Fred went beyond the scope of the authority conferred upon him to be dealing with the Owners for his benefit and not for the benefit of the Builders.

     32. March v E & MH Stramare (1991) 171 CLR 506

230. The scope of the liability element is also satisfied. Causation is made out.

NATURE & EXTENT OF INJURIES

Mr Zheng’s evidence

231. After his fall, Mr Zheng was conveyed by ambulance to hospital where he remained for a week, where he was treated for his fractured tailbone, back, ribs, damaged spleen and brain injury.

232. Among the hospital records was a final report of a CT of Mr Zheng’s brain indicated that although he had initially sustained a subarachnoid haemorrhage, that was no longer evident; and also a final report of a CT Trauma report; which noted small areas of splenic laceration with a small amount of haemoperitoneum in the upper abdomen, there was no evidence of actual bleeding; an undisplaced fracture in the left (10^th) rib, minimally displaced transverse process fractures of the lumber spine and spinous process fracture of the L5 and undisplaced right ilium and left inferior pubic ramus fractures. Upon his discharge from hospital, he had been prescribed paracetamol.

233. Upon his discharge, he was bedridden for about four weeks, during which period he received consultations from a GP and underwent physiotherapy.

234. After leaving hospital, Mr Zheng consulted a number of general practitioners in a practice at Auburn.

235. Under cross-examination, Mr Zheng accepted that he had not seen a general practitioner since 2019 and had not received physiotherapy since shortly after he was discharged from Royal Prince Alfred Hospital after the accident. He recalled having only two visits to a physiotherapist.

236. It was suggested to Mr Zheng that when he saw Dr Dalton, a consultant physician who had been engaged by the first and second defendants in July 2020, he had made certain statements contrary to what he informed the Court. These statements to Dr Dalton were proven in a redacted version of the report of that practitioner (Exhibit 22) which I admitted, subject to a limitation that it was to be used in only in relation to the plaintiff’s credibility. This included his stating to the Court that he was unconscious after the fall, after having earlier told Mr Dalton that he was not unconscious. According to Dr Dalton, Mr Zheng had told him about his inability to seek out and persuade his employer to lodge a claim on his behalf. Mr Zheng suggested that the employer was displeased by that idea. It was also suggested that Dr Dalton had recommended to Mr Zheng that he receive on-going physiotherapy treatment and that he receive exercise in physiology. Mr Zheng could not recall receiving such recommendations. He said he had not read Dr Dalton’s report, but had been notified of its contents.

237. In re-examination, Mr Zheng said he did not know what exercise in physiology was and he evinced a very rudimentary understanding of the services of a physiotherapist; essentially assimilating it to the services of a masseur. He said that since leaving hospital, he had not been able afford massages. He was not, however asked about his willingness to undertake physiotherapy or exercise in physiology on the assumption that he had the financial means to do so.

238. Mr Zheng said that he still suffers from lower back pain; particularly when doing any heavy lifting, bending over or “on rainy days”. He did not indicate any pronounced difficulty with reading in the sense of headaches or loss of concentration; although he did identify a difficulty with his neck, when tilting his neck to read.

Medico-legal evidence

Dr Giblin

239. Mr Zheng was examined by Dr Giblin, an orthopaedic surgeon on 15 April 2019. The plaintiff relied upon a report of that date (Exhibit I). At that time, Mr Zheng reported complaints about neck pain, headaches, pain in his lower back and groin and left buttock.

240. On examination, Dr Giblin noted restricted movement in Mr Zheng’s neck, which beyond a certain point, produced muscle spasm and pain. In his examination of Mr Zheng’s lower back, some muscle spasm and pain was produced on extension. Dr Giblin observed a full range of movement in Mr Zheng’s shoulders and hips.

241. Dr Giblin diagnosed a fracture to his left tenth rib, fracture of his L5 vertebra and of his pelvis.

242. Dr Giblin did not anticipate future surgical intervention; a prediction which has come to pass. He did, however, expect Mr Zheng to require physiotherapy in the course of the next two years and would also need to see his general practitioner twice a year in that same period. This period has passed.

243. No ‘refresher’ evidence of Dr Giblin was served.

244. None of the third and fourth (or fifth) defendants relied upon expert evidence about the extent of Mr Zheng’s injuries or his residual working capacity^[33] .

Parties’ submissions

33. The third and fourth defendants’ tender of an expert medical report prepared by the first and second defendants was rejected at trial: Zheng v Ianni & Ors [2021] NSWDC 492.

The Builders’ submissions

245. On the extent of the plaintiff’s injuries, in her closing written submissions, Counsel for the Builders submitted that the plaintiff’s injuries were not as serious as he alleged. There were inconsistencies between what the plaintiff told Dr Dalton, or the ambulance and what he told the Court about his injuries. For instance, he said in Court that he was unconscious after his fall, but records show that on his way to hospital he was anxious about his wallet. He said he needed a wheelchair to return home after hospital but hospital records did not verify that fact.

The plaintiff’s submissions

246. The plaintiff submitted that the Court should accept the unchallenged opinion of Dr Giblin and the plaintiff’s account of his injuries.

Findings

247. I did not regard the inconsistencies suggested by Counsel for the third and fourth defendant as materially detracting from Dr Giblin’s unchallenged diagnosis of the fractures that the plaintiff sustained from the accident. However, the evidence of current or continuing disabilities is meagre; essentially dependent entirely upon the plaintiff’s evidence. I accept plaintiff’s evidence that he continues to periodically experience pain in his neck, some stiffness in his shoulders and lower back and that those conditions were, and continue to be, attributable to the accident.

QUANTUM

248. In a schedule of damages supplied to the Court on the first day of the hearing (MFI 9), the plaintiff’s claims were articulated as follows:

Non-economic loss (40% of a MEC)	$275,000.00
Past economic loss	$158,000.00
Past superannuation (11%)	$17,380.00
Past out of pocket expenses (incl Medicare)	$10,000.00
Future economic loss (buffer including superannuation)	$150,000.00
Future out of pocket expenses (buffer)	$20,000.00
Future domestic assistance (buffer)	$20,000.00
Total	$650,380.00

249. The third and fourth defendants’ schedule of damages (MFI 10) ultimately supplied to the Court were articulated as follows:

Non-economic loss	Nil
Past economic loss	$40,625.00
Past superannuation	Nil
Past out of pocket expenses	$1,000.00
Future economic loss	$4,000.00
Future out of pocket expenses (buffer)	$5,000.00
Future domestic assistance	Nil
Total	$50,625.00

Background

250. Mr Zheng is now over 50 years of age. He was born in China. He attended secondary school until 1988.

Non-economic loss

251. Mr Zheng described issues with his sleep and trouble undertaking long distance walking. There were very little specifics to indicate pronounced loss of amenities of life. He did not, however, identify any other pastimes or sporting activity which were now impeded as a result of injuries sustained through the accident which he had been fully capable of enjoying prior to the accident. He did say, and I accept, that he has ongoing issues with prolonged use of the telephone and sitting down, at length, to watch television. I find that Mr Zheng does experience temporary pain in his lower back and neck which is causally attributable to his accident, but it is relatively minor.

252. I assess non-economic loss at 28% of a most extreme case. That yields an allowance of $96,180.

Working capacity

The claim

253. In his schedule of damages, the plaintiff made a claim of lost income up in the sum of $158,000. This was party calculated on the basis of:

1. a complete absence from work for 31 weeks (12 April 2018 to 15 November 2018) at the rate of $1,200 per week ($37,200);

2. his inability to work in his pre-accident capacity (a tiler); this sum being $900 per week for the 32 weeks up to 1 July 2019 ($28,800);

3. his inability to work in a full-time capacity from 2 July 2019 to the date of trial ($92,000).

254. Past superannuation (at 11%) on this sum was $17,380.

255. As indicated, although the Builders ultimately submitted a figure for past economic loss, no submissions were made as to how the figure was derived.

The evidence

256. From 1990, Mr Zheng worked in various construction jobs whilst in China up to 1999. He arrived in Australia in 2017, on a protection visa. He is married, but apparently separated from his wife, who lives in China with their children. Mr Zheng supports his wife and children by transferring money to them overseas.

257. In his evidence, the plaintiff said that prior to working at the site at Drummoyne, he had been working 6 days a week, for two weeks, getting paid cash $300 per day. As indicated, however, that evidence was limited, in its terms, to the two weeks before the accident.

258. Certain certificates of incapacity in 2018 were tendered (Exhibit M), but neither party referred to their contents.

259. In July 2018, a few months after the accident, the plaintiff took a job as a meat packer, but this only lasted for 3 or 4 days. He felt pain in his lower back, neck, inner thigh and pelvis, from standing and lifting heavy items.

260. Mr Zheng said that he worked as a cleaner (or perhaps more accurately gardener) over a non-consecutive period of 10 days, working 8 hours a day, receiving $200 a day. He stopped this work since after finishing his shift he felt pain.

261. Since July 2019, Mr Zheng has worked for a builder Mr Danny Hu, who, he says, has engaged him occasionally to do tiling work. He says he has been doing small jobs. Mr Zheng says that the number of days he worked each week depended not only upon the availability of work, but also how he feels; but on average, is about 2 or 3 days a week, for about 8 hours. He said that when he does this work, he receives assistance from another worker. He also said that Mr Hu has indicated to him that he will only allocate jobs for him on the basis of his perception of Mr Zheng’s physical capacity to do them.

262. It was put to Mr Zheng, but Mr Zheng denied, that he could, if he chose, perform other work on the occasions when he was not engaged by Mr Hu. He indicated that he had inquired into other sources of income. It was also put to Mr Zheng, but he denied, that his injuries were not restricting his working capacity.

263. He said that he has not been in receipt of Centrelink benefits.

264. Mr Zheng said that he initially was paid $300 per day from this work, but that rate of pay has increased. Since June this year, he has been paid $350 each day.

265. Tax returns adduced in evidence (Exhibit O) indicate the plaintiff’s taxable income being as follows:

FYE 30 June 2018   $61,471

FYE 30 June 2019   $20,968

FYE 30 June 2020   $14,107

FYE 30 June 2021   $23,685

266. An inherent difficulty with this evidence is that the starting (financial) year for the tax return was the year in which the accident occurred (and towards the end of that year). The plaintiff gave scant evidence of how often any labour hire firm that employed him for the subject job utilised his services in this country as a tiler and the Court has no other reliable evidence of the frequency of work, for any sustained period, that he enjoyed in that capacity prior to the accident. For all the Court knows, the plaintiff enjoyed a good financial year prior to the accident relative to the past. The Court’s impression is that prior to the accident, he had no fixed employment which could support an on-going incapacity premised upon continuous or permanent full time employment, getting $1200 a week.

267. The plaintiff said that he transferred monies from his account to support his family overseas. He did not adduce bank statements which might have indicated not only how much he had transferred overseas, but also how much he had received from earnings.

268. It is, however, clear from the tax returns, that there has been a diminution in his earnings and I accept that it has been proved, in combination with acceptance of the plaintiff’s evidence (it being to his credit that he has returned to work with his incapacity) that he has suffered a diminution.

269. In the closing submissions of Junior Counsel for the plaintiff, it was accepted that the plaintiff was partially fit for work and his claim for damages in relation to past and future earning capacity was conservative. His decline in income was established, amongst other things, by his tax returns.

270. Counsel for the Builders did not articulate how the Builders arrived at their suggested figures for past economic loss, or (for that matter) future loss of earning capacity.

271. There were no Income Statements or Group Certificates in evidence and in the last two financial years, there was no identification in the plaintiff’s tax returns (Exhibit O) of any employer (such as Mr Hu). I agree with the submission of the plaintiff’s counsel that it has not been demonstrated that any employer of the plaintiff has incurred an obligation to pay superannuation.

272. Doing the best I can, noting the difficulties I have alluded to, I make an allowance for this head in the sum of $100,000.

Future loss of capacity

273. His claim for future loss of capacity is also calculated on the basis of $900 per week until he reaches the age of 67; which was said to reflect a reduction in the plaintiff’s pre-accident weekly earnings.

274. In his report of 15 April 2019, Dr Giblin said he thought that Mr Zheng remained unfit for work involving repetitive bending or heavy lifting. But since July 2019, Mr Zheng has been regularly employed, albeit only on light duties. I accept that his earning capacity is likely to remain diminished in activities involving bending or heaving lifting.

275. But for the accident, I assume that he would have continued to trade as a labourer, taking jobs until the age of 67 and to do so generally unhindered. There was always a possibility, however of other matters affecting his health and therefore his physical capacity which might thwart that aspiration.

276. I consider it is appropriate to award a buffer.

277. For the purposes of s 13(2) of the CL Act, I find that the adjustment should be nil. I allow a buffer of $100,000.

Out of pocket expenses

278. Mr Zheng said in his evidence that he has spent $100-200 in painkillers. This is over a period of three and a half years. At the time of the hearing, there was no evidence of Medicare charges. I accept the Builders’ submission and make modest allowance of $1,000 for the past.

278. There is no evidence of any future preparedness to undertake physiotherapy treatment or any other form of treatment of the kind suggested in Dr Giblin’s report which, at the time of the hearing, was stale evidence. I am prepared to allow a modest buffer to provide some recompense for the pain relief which he is likely to continue to take. I also accept the Builders’ submission and allow the sum of $5,000.

Domestic assistance

280. Dr Giblin refrained from expressing any view about domestic assistance; suggesting that the view of an occupational therapist be obtained. In the event, the plaintiff did not obtain evidence of the latter kind.

281. Mr Zheng called two lay witnesses to testify to his incapacity to attend to domestic matters after he returned home after his stay in RP Hospital. Mr Busheng Zheng (a flatmate) and Mr Gongsheng Zhou (a neighbour and friend) helped the plaintiff with the preparation and delivery of meals to his bedroom, his laundry, shopping and toiletry needs. Their evidence, however, spoke of a relatively brief period for the past. Their evidence did not fulfil the requirements in s 15 of the CL Act. No claim is made for past assistance.

282. Mr Zheng said that he was capable of cooking, doing the laundry and cleaning. I find that there is some evidence, albeit slight, to indicate the likelihood that physical restrictions derived from the accident will possibly mean that he requires assistance. But I also factor in the real possibility that such need for future assistance will arise for reasons other than the accident, such as the natural onset of the ageing process and other vicissitudes.

283. Junior Counsel for the plaintiff submitted that the evidence of Mr Busheng Zheng and Mr Gongsheng Zhou, although it did not sustain a claim for past domestic assistance, supported a claim for future buffer award for domestic assistance on a commercial basis. Further the plaintiff’s evidence of his diminished capacity to earn (such as his employer selecting him for appropriate jobs or arranging assistance) itself indicated a real possibility that in the future, his inability to lift certain objects may mean that he seeks assistance from someone else to help him with domestic duties.

284. I would make an allowance for this head in the sum of $15,000.

Summary on quantum

285. Quantum is as follows:

Non-economic loss	$96,180.00
Past economic loss	$100,000.00
Future loss of earning capacity	$100,000.00
Past out of pocket expenses	$1,000.00
Future out of pocket expenses	$5,000.00
Future domestic assistance	$15,000.00
Total	$317,180.00

ORDERS

286. The Court makes the following orders.

1. As against the fifth defendant, I assess damages on the plaintiff’s judgment against him as being $317,180.

2. As against the third and fourth defendants, judgment for the plaintiff for the sum of $317,180, for which judgment sum they are jointly liable with the fifth defendant.

3. The third, fourth and fifth defendants are to pay the plaintiff’s costs, as agreed or assessed

4. Liberty to apply on 7 days’ notice in relation to costs.

5. Exhibits be returned within 28 days.

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Endnotes

Decision last updated: 30 September 2021