Zoja Pty Ltd v Frost Constructions Pty Ltd
[2014] QCAT 214
| CITATION: | Zoja Pty Ltd v Frost Constructions Pty Ltd [2014] QCAT 214 |
| PARTIES: | Zoja Pty Ltd (Applicant) |
| v | |
| Frost Constructions Pty Ltd (Respondent) |
| APPLICATION NUMBER: | BDL230-12 |
| MATTER TYPE: | Building matters |
| HEARING DATE: | 29 May 2013; 26 September 2013 |
| HEARD AT: | Brisbane |
| DECISION OF: | Member Favell, |
| DELIVERED ON: | 20 May 2014 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | 1. The Claims and Counter Claims are dismissed. |
| CATCHWORDS: | Building work – whether building contract – where no building contract in writing – whether claims made were a building dispute within the jurisdiction of the Tribunal – where quantum meruit counterclaim – Whether Tribunal had jurisdiction to determine a quantum meruit claim when the dispute was not a Domestic Building dispute and was not arising between a building owner and a building contractor relating to the performance of reviewable commercial work or a contract for the performance of reviewable commercial work |
APPEARANCES and REPRESENTATION (if any):
| APPLICANT: | Zoja Pty Ltd represented by Mr G Nelson |
| RESPONDENT: | Frost Constructions represented by Mr R Enzby of Hemming & Hart Lawyers and Mr Frost |
REASONS FOR DECISION
The respondent was approached by the applicant to complete construction at 117 Swan Street, Gordon Park, which was a four unit multi-storey dwelling.
The applicant contends that there was a contract for building works. The respondent denies there was a contract. No written contract has been produced.
Construction commended in October 2010 and was complete on or about September 2011.
The applicant filed an application with the Tribunal on 16 July 2012. An amended application was filed on 17 November 2012. The applicant has several remaining complaints concerning the construction:
a) Claim D: A claim of $3,399.44 (amended to $3,090.40) for additional costs because beam 7 was installed without being fireproofed according to BSA standards.
b) Claim E: A claim for $729 because external sheeting of a bi-fold door was too long causing it to become jammed.
c) Claim I: A claim for $570.50 because of excess yellow-tongue flooring used and metal ceiling batons belonging to the applicant were taken from site by the respondent without compensation.
d) Claim K: A claim for $1,169 because deliveries to site of building materials were excessive and ordering was inefficient.
e) Claim M: A claim for $2,159 the costs of engaging a cost estimator.
f) Claim N: A claim for $107.46 because the applicant was charged and paid for building materials that were not used at construction.
g) Claim R: Mr Nelson seeks to charge $4,600 (amended to $6,400 exhibit 10) for his time in preparing the applicants claim.
h) Claim S: A claim for $700 because the applicant was charged for labour on days when no work was carried out by the respondent.
i) Claim T: A claim for 11,251.81 because a 5% cost plus margin excluding wages was agreed upon whereas the respondent charged a 10% costs plus margin.
The applicant relied on written submissions and annexures and did not call any witnesses.
The respondent’s counterclaim is in respect of labour and materials claimed to be provided (for which the Applicant had not paid) in the sum of $20,399.26 as particularised in exhibit 5.
Claim D
In respect of Claim D, the respondent contends that the plans required steps be taken towards fireproofing beam 7. The Building Inspection Report from Coastline required the engineer to be contacted for the method of protecting the steel beam B7 to Units 3 and 4 to the Building Code of Australia requirements, and required the engineer, upon inspection of the beam to provide a Form 16. The engineer inspected the beam on 9 June 2012 and noted that the beam had not been fire-proofed. The certifier issued a direction as a result of that inspection and the engineer, from Structerre, completed an illustrated detail for fire-proofing dated 20 June 2011. The respondent was unable to complete the fireproofing in accordance with that detail because the beam was in situ.
The respondent claims that the beam was constructed in accord with Structerre Engineering plan drawing number S12 Section A S10. The construction fault was due to a faulty plan not faulty construction. The respondent says any cost of rectification is not its responsibility.
Drawing S11 has the notation ‘Bearer, B7 with fire proof lining in accordance with BCA standards’.
The notes to the drawings are ‘Ensure bearer B7 is provided with fire rated cladding’.
In my view the plans required the respondent to provide a fire proof lining in accord with BCA requirements.
Because no detail for the fireproofing was provided to the respondent and the respondent had placed the beam before any fire proofing was done the subsequent detail provided could not be complied with and an alternate system of fire proofing was used.
No evidence from the engineer was provided. Absent evidence from the engineer, the applicant was unable to prove that the steps taken by the respondent were inadequate or not in accordance with the plans except that fireproofing was not provided.
The applicant’s claim for quantum is based on an estimate from an entity called the Builders Office dated 28 February 2000. The applicant claims that the respondent incurred additional costs in undertaking the fireproofing in comparison to an estimate of the cost of fire proofing the beam in accordance with Structerre’s hand-written drawing. The only direct evidence of the work initially undertaken by the respondent in carrying out the initial fireproofing is contained in the statement of Mr Frost dated 1 March 2013. Mr Frost contended that there was no extra cost for work to allow the beam to be treated after it had been put in situ.
In exhibit 3 Mr Frost criticised the costing estimate by the Builders Office. In my view those criticisms have merit.
I am not satisfied that the rectification that was carried out to the beam was necessary because of the work of the respondent or that the respondent was responsible for the rectification. The respondent should have made the beam fireproof in accord with the BCA requirements but because that had not been done does not mean the work done by the respondent before the beam was fire proofed was defective. The fireproofing was still to be done. It had not been charged for. I am not satisfied that the cost claimed in claim D is made out and is the responsibility of the respondent.
Claim E
The applicant seeks to establish an alleged failure of the bi-fold door by relying on an email from John McHardy from Window and Door Installations, the original installers of the door, dated 30 May 2012.
Mr Frost was not contacted about the failure and the door was fixed by Window and Door Installations.
The email said
The bi-fold door head had a 10mm beau (sic) down in it. We took the cladding above the door head off which was sitting tight down on the head and also tight to the floor joist above. A 4mm camber up was put back into the door head and cut 10mm off the cladding and put back in. Service doors –all working correctly again. I believe the cause of the problem was the cladding was cut tight between the floor joice (sic) and the bi-fold head. When the floor sagged our head sagged with it. The pressure caused the screws to pop out of our angle, which was holding the bi-fold head up. There was a 5mm beau (sic) up in the sill, I did not rectify this as it could damage the water proofing. As well the doors were working correctly.
Mr Frost challenges the stated cause of the problem and denies that his work had caused the problem. Significantly he says the stated cause could not have been so because the cladding had not been put up before the doors were installed and the doors were serviced after the cladding was completed.
Dowel charged $792 for ‘service as listed on quote 165671’. That quote has not been provided to the Tribunal.
I do not accept that it has been shown that the respondents were the cause of the problem with the door.
Claim I
The Builder’s Office report indicated that the number of yellow tongue sheets required, and supplied, was 96 sheets plus a 10% wastage factor of 10 sheets supplied by Brendale Building Services. In the applicant’s original application, the applicant claims that Frost Constructions supplied a further twelve sheets. The applicant also asserted that 4 sheets were used for temporary use in units 3 and 4. The applicant contends that a total of 110 sheets should have been used when the number asserted as used was 118.
In his second statement of evidence, the respondent asserted that 90 lengths of ceiling batons were left at the end of the construction. The applicant was unsure of the amount left over. The respondent claims that he supplied twenty lengths of ceiling batons from his own stock. He took 30 lengths and left 60 lengths for the applicant in his garage. The applicant had no evidence to the contrary.
In exhibit 3 Mr Frost says that the estimate given by the Builders Office concerning metal battens used is mistaken because of the incorrect assumption that they were at 600mm centres. He says that Mr Nelson failed to take into account flooring used for the back two units on the top floor in the recessed area. That is backed by the evidence and statement of Adam Whiteway and the evidence of Neil Blackmore.
Mr Frost said he used yellow tonged flooring he had to cover two trussed areas. He says that there was an extension of 500mm to units 3 and 4 which increased the floor area. That was not taken into account by The Builders Office.
Much of the evidence on this point was based on where and how the flooring was laid. Further, after the hearing further evidence was provided concerning those matters. Mr Nelson provided an updated plan which he contended shows the number of sheets used was 102. The respondent contends 110 were used. On 20 October Mr Frost contested the further evidence from Mr Nelson partly on the basis that it assumes no wastage, it is based on incorrect measurements and a misreading of the plans. Further it did not take into account all of the matters contended by Mr Frost.
I am not satisfied that the basis of this claim has been made out. I accept the contention that the battens taken from the site were a trade off for the extra flooring supplied and not charged on the basis that the extra flooring was double the cost of the metal battens.
Claim L
In response to claim L, the respondent claims that because of a lack of available storage and scaffolding blocking extra garage space in units 3 and 4, the deliveries were not excessive and the ordering was done to take into account site problems. Other than the applicant’s personal summation, the applicant did not provide any evidence to the contrary.
I accept the contentions of the respondent.
Claim M
The respondent contends that it is not responsible for the claimed cost because it was not part of the construction cost. In my view the claim is for the cost of preparing a report to be used in the hearing. It is not a cost of rectifying negligent or defective work.
Claim N
In response to claim N, the respondent claims that extra materials appeared in the invoices but were not charged to the applicant. I am not satisfied that that is not correct.
Claim R
This claim is really a claim for Mr Nelson’s time in preparing the applicants case.
Mr Nelson is not a lawyer. He is a director of the applicant.
The High Court has held in Cachia v Hanes[1] that compensation for the loss of time a litigant in person cannot be said to be costs. The notion of costs to the common law is that costs are awarded by way of indemnity for professional legal costs incurred in the conduct of litigation. That is not the case here.
[1](1994) 179 CLR 403.
If costs were to be considered the starting point for consideration of the question of costs is s 100 of the QCAT Act which provides ‘that other than as provided for by the act or an enabling act, each party must bear their own costs’.
The exception is provided for in s 102 of the QCAT Act namely that the interests of justice require such an order.
Some guidance is provided for in that section as to the matters that the Tribunal can have regard to in determining this issue.[2]
[2]QCAT Act s 102(3)(a) – (f).
Further this is not a case where the applicant would in the circumstances be likely to have a costs order made even if leave was given for representation and it had incurred legal expenses.
A basis for this claim is not made out.
Claims R, S and T
The applicant asserts that there was a margin of 5% to be applied to materials only.
The respondent asserts that there was no agreement about how the work was to be charged. The respondent’s claim is based on a quantum merit entitling the respondent to costs plus a reasonable margin. The evidence relied upon in making out a reasonable margin is based on the respondent’s experience as a builder and on the Builders’ Office report which allowed a 10% profit margin with a 5% allowance for preliminaries. This, the respondent asserts, was consistent with billing protocol from the prior two jobs that had been completed for the applicant.
The applicant asserts that, to the contrary, there was a written contract for each of the jobs for which the respondent had been engaged. The fact that there is no copy of the contract, according to the applicant, is due to ‘stupidity’.
The respondent claims that all days charged were worked and supports the claim with diary notes. Mr Frost says that even though there was rain on some days work was still done. I am not satisfied that the respondent has claimed and been paid for work which was not done.
I am not satisfied that there was an agreement about the calculation of payment for the work to be done. It seems that claims were made and paid without a dispute about the basis for the claims made until the time of making an application to this Tribunal.
Jurisdiction
There is a question as to the jurisdiction of the Tribunal to make the orders sought by the applicant.
QCAT has jurisdiction to determine matters it is empowered to deal with under the Queensland Civil and Administrative Tribunal Act 2009 or an enabling Act.
The Queensland BuildingServices Authority Act 1991 (QBSA Act)[3] allows a person involved in a building dispute to apply to the Tribunal to have the Tribunal decide the dispute.[4]
[3]Now the Queensland Building and Construction Commission Act 1991.
[4]QBSA Act s 77.
Section 77 of the QBSA Act provides:
Tribunal may decide building dispute
(1)A person involved in a building dispute may apply, as provided under the QCAT Act, to the tribunal to have the tribunal decide the dispute.
(2)Without limiting the tribunal’s powers to resolve the dispute, the tribunal may exercise 1 or more of the following powers –
(a)Order the payment of an amount found to be owing by 1 party to another;
(b)Order relief from payment of an amount claimed by 1 party another;
(c)Award damages, and interest on the damages at the rate, and calculated in the way, prescribed under a regulation;
(d)Order restitution;
(e)Declare any misleading, deceptive or otherwise unjust contractual term to be of no effect, or otherwise vary a contract to avoid injustice;
(f)Avoid a policy of insurance under the statutory insurance scheme;
(g)Order rectification or completion of a defective or incomplete tribunal work;
(h)Award costs.
The term ‘building dispute’ is defined in Schedule 2 of the QBSA Act as meaning, relevantly,
a domestic building dispute… or a minor commercial building dispute or a major commercial building dispute if the parties to the dispute consent to the dispute being heard under section 79.
‘Domestic building dispute’ means –
(a)A claim or dispute arising between a building owner and building contractor relating to the performance of reviewable domestic work, or a contract for the performance of reviewable domestic work; or
(b)A claim or dispute arising between two or more building contractors relating to the performance of reviewable domestic work, or a contract for the performance of reviewable domestic work; or
(c)A claim or dispute in negligence, nuisance or trespass relating to the performance of reviewable domestic work other than a claim for personal injuries; or
(d)A claim or dispute arising between a building owner and building contractor in any one or more of the following, relating to the performance of reviewable domestic work, or a contract for the performance of reviewable domestic work –
(i)An architect;
(ii) An engineer;
(iii) A surveyor;
(iv)A quantity surveyor;
(v) An electrician or an electrical contractor;
(vi) A supplier or manufacturer of materials used in the Tribunal work.
(Underlining added).
‘Reviewable domestic work’ is defined in schedule 2 of the QBSA Act as,
domestic building work under the Domestic Building Contracts Act 2000, except that for, applying section 8(8) of that Act the definition excluded building work in that Act, is taken not to mean anything mentioned in paragraph (b), (c) or (d) or the definition.
‘Domestic building work’ as the term is used in the QBSA Act is defined in section 8 of the Domestic Building Contracts Act 2000.
8 Meaning of domestic building work
(1)Each of the following is domestic building work—
(a)the erection or construction of a detached dwelling;
(b) the renovation, alteration, extension, improvement or repair of a home;
(c) removal or resiting work for a detached dwelling.
(2) However—
(a) removal work for a detached dwelling is domestic building work only if the dwelling is intended to be resited at another place and used, at the place, as residential premises; and
(b) resiting work for a detached dwelling is domestic building work only if the dwelling is intended to be used at the place at which it is being resited as residential premises.
(3) Domestic building work includes—
(a) work (associated work) associated with the erection, construction, removal or resiting of a detached dwelling; and
(b) work (associated work) associated with the renovation, alteration, extension, improvement or repair of a home.
(4) Without limiting subsection (3), associated work includes—
(a) landscaping; and
(b) paving; and
(c) the erection or construction of a building or fixture associated with the detached dwelling or home.
(5) For the erection or construction of a detached dwelling, domestic building work includes the provision of services or facilities to the dwelling or the property on which the dwelling is, or is to be, situated.
(6) For the renovation, alteration, extension, improvement or repair of a home, domestic building work includes the provision of services or facilities to the home or the property on which the home is situated.
(7) Also, domestic building work includes—
(a) site work relating to work mentioned in subsection (1), (3), (5) or (6); and
(b) work declared under a regulation to be domestic building work if there are reasonable grounds for considering the work to be domestic building work.
(8) However, domestic building work does not include excluded building work.
(9) In this section—
(a)a reference to a detached dwelling includes a reference to any part of a detached dwelling; and
(b)a reference to a home includes a reference to any part of a home; and
(c) a reference to site work includes a reference to work required to be carried out to gain access, or to remove impediments to access, to a site.
(10) In this section—
removal work, for a detached dwelling, means work relating to the dwelling carried out at the place at which the dwelling is located for relocating the dwelling to another place.
resiting work, for a detached dwelling, means work relating to the dwelling carried out at a place for resiting the dwelling at the place following its removal from another place.
‘Building work’ is defined in Schedule 2 of the QBSA Act to mean –
(a)the erection or construction of a building; or
(b)the renovation, alteration, extension, improvement or repair of a building; or
(c) the provision of lighting, heating, ventilation, air-conditioning, water supply, sewerage or drainage in connection with a building; or
(e) any site work (including the construction of retaining structures) related to work of a kind referred to above; or
(f) the preparation of plans or specifications for the performance of building work; or
(fa)contract administration carried out by a person in relation to the construction of a building designed by the person; or
(g)fire protection work; or
(h)carrying out site testing and classification in preparation for the erection or construction of a building on the site; or
(i)carrying out a completed building inspection; or
(j)the inspection or investigation of a building, and the provision of advice or a report, for the following—
(i) termite management systems for the building;
(ii) termite infestation in the building;
but does not include work of a kind excluded by regulation from the ambit of this definition.
Detached Dwelling is defined in the Domestic Building Contracts Act as a single detached dwelling or a duplex.
For the Tribunal to have jurisdiction, there must be a building dispute.[5] The applicant must be a person involved in the building dispute. The building dispute must either be a domestic building dispute, or a minor commercial building dispute or a major commercial building dispute to which the parties have consented to the dispute being heard by the Tribunal under section 79 of the QBSA Act.
[5] QBSA Act s 77.
The dispute here is not a domestic building dispute because it not a dispute about a detached dwelling or a duplex.
‘Minor commercial building dispute’ means ‘a commercial building dispute where neither the claim nor the counterclaim exceeds $50,000’.
Here, the claim nor the counter claim exceeds $50,000.
Commercial building dispute means—
(a)a claim or dispute arising between a building owner and a building contractor relating to the performance of reviewable commercial work or a contract for the performance of reviewable commercial work; or
(b)a claim or dispute arising between 2 or more building contractors relating to the performance of reviewable commercial work or a contract for the performance of reviewable commercial work; or
(c) a claim or dispute in negligence, nuisance or trespass related to the performance of reviewable commercial work other than a claim for personal injuries; or
(d) a claim or dispute arising between a building owner or a building contractor and any 1 or more of the following relating to the performance of reviewable commercial work or a contract for the performance of reviewable commercial work—
(i) an architect;
(ii) an engineer;
(iii) a surveyor;
(iv) a quantity surveyor;
(v) an electrician or an electrical contractor;
(vi) a supplier or manufacturer of materials used in the tribunal work.
Reviewable commercial work means tribunal work other than reviewable domestic work.
Commercial building contract means a building contract that is not a construction management trade contract or a subcontract.
Many of the claims made by the applicant are based on allegations of dishonesty.
In my view those allegations have not been established but in any event they are not claims arising out of a claim or dispute relating to the performance of reviewable domestic work or a contract for the performance of reviewable domestic work.
Nor are they claims or disputes in negligence, nuisance or trespass relating to the performance of reviewable domestic work other than a claim for personal injuries.
This is in part a commercial building dispute. For the Tribunal to have jurisdiction, relevantly, it must a claim or dispute arising between a building owner and a building contractor relating to the performance of reviewable commercial work or a contract for the performance of reviewable commercial work.
In my view the applicant’s claims D and E may be claims or a dispute so arising but the remainder of the claims are not. Further they are not claims or disputes in negligence, nuisance or trespass related to the performance of reviewable commercial work.
I am not satisfied that there was agreement about the profit margin for the building.
The Domestic Building Contracts Act requires contracts to be in writing. Section 30 provides that a regulated contract has effect only if it is signed by the building contractor and building owner.
Section 55 prohibits cost plus contracts in certain circumstances and if a building contractor enters into a cost plus contract in contravention of the section the building contractor cannot enforce the contract against the building owner. The Tribunal may however award a building contractor the cost of providing the contracted services plus a reasonable profit if the Tribunal considers it would not be unfair to the building owner to make the award.
However, this dispute however it is characterised, is not a Domestic Building dispute and the Domestic Building Contracts Act does not apply.
There is no similar provision to section 55 of the Domestic Building Contracts Act in the QBSA Act or any other relevant enabling act. That means that unless the dispute is as I have described above the Tribunal does not have jurisdiction.
The respondent counter claims on the basis that it has rendered invoices for $501,750.92 but has only been paid $478,344.15. The applicant denies receiving all of the invoices relied on by the respondent. The applicant alleges that the respondent tampered with invoices and did not send him all the relevant invoices later submitted to the Tribunal. He asserts that the invoices submitted to the Tribunal differ in amount and layout.
The respondent’s counter claim is not particularised, but for his assertion that the invoices B1, B2 and B3 submitted to the Tribunal equal the costs of expenditure minus the labour margin. In any case, the invoices submitted by the respondent do not constitute the basis of the counter claim, it is based on the summary of invoices B1, B2 and B3.
A claim based on quantum meruit can be made by an applicant for reasonable remuneration for work already performed and voluntarily accepted by the respondent. (If the Tribunal has jurisdiction to determine such a claim.) It is insufficient to merely show the work has been done. A claim for quantum meruit may be available to allow recovery for services rendered and, can be made when the contract is at an end or is unenforceable or in circumstances where there is no contract.
In Pavey and Matthews Pty Ltd v Paul[6], Justice Deane commented
what the concept of monetary restitution involves is the payment of an amount which constitutes, in all the relevant circumstances, fair and just compensation for the benefit or enrichment actually or constructively accepted.
Ordinarily that would correspond to the fair value of the benefit provided (e.g. remuneration calculated at a reasonable rate for work actually done or the fair market value of materials supplied).
[6](1987) 162 CLR 221.
Dowsett J in Balfour Beatty Power Construction Australia Pty Ltd v Kidston Goldmines Ltd[7] held that in calculating a reasonable price, it is permissible to show what the actual cost is of the work in terms of hours spent and materials supplied.
[7][1989] 2 Qd R 105.
The counter claim could have been cast as a claim for work and labour done and materials supplied.
The High Court in Lumbers v W Cook Builders Pty Ltd (in liq),[8] held that a request for work and labour is an essential element of the claim and the concept of unjust enrichment as set out in Pavey’s case would not enable restitution without evidence of an express or implied request for the work and labour from the applicant.
[8](2008) 232 CLR 635.
Within the framework of a cause of action, such as an action for work and labour done, one may look to the elements of a claim in restitution if the contract is unenforceable. The elements are: (a) the respondent must receive a benefit; (b) the benefit must be at the applicant’s expense; and (c) the benefit must be unjustified.
As to the first point, a benefit may be demonstrated on the facts of a case if a party has requested work, labour and materials, the party has freely accepted the work, labour and materials or the party has obtained an incontrovertible benefit from the work, labour and materials.
As to the second point, in this case any contractual relationship is between the parties, work the subject of the claim was performed by the respondent at its cost.
The final element requires the existence of a factor that makes it unjust for the applicant to retain a benefit. It is not sufficient to merely allege that the retention of the benefit is unfair or unconscionable. The unjust factor alleged by the respondent must be a cause of the applicant’s receipt of the benefit.
Free acceptance is a specific ground or unjust factor identified by the Australian courts.
Justice Warren in Andrew Shelton & Co Pty Ltd v Alpha Healthcare Ltd[9] provides a detailed analysis of restitution and the necessary elements, including whether or not free acceptance may serve a dual function within a claim for restitution based on unjust enrichment.
[9](2002) 5 VR 577.
That is, both as the measure of the enrichment and as the ground of restitution. Her Honour quoted from Goff and Jones, The Law of Restitution (5th ed) (1998):
A defendant, who is not contractually bound, may have benefited from services rendered in circumstances in which the court holds him liable to pay for them. Such will be the case if he freely accepts the services. In our view, he will be held to have benefited from the services rendered if he, as a reasonable man, should have known that the plaintiff who rendered the services expected to be paid for them, and yet he did not take a reasonable opportunity open to him to reject the proffered services. Moreover, in such a case, he cannot deny that he has been unjustly enriched.
The last principle to be considered is how assessment of the quantum of the restitution sought, should be conducted. His Honour Justice Deane said in Pavey’s case:
What the concept of monetary restitution involves is the payment of an amount which constitutes, in all the relevant circumstances, fair and just compensation for the benefit or “enrichment” actually or constructively accepted. Ordinarily, that will correspond to the fair value of the benefit provided (e.g. remuneration calculated at a reasonable rate for work actually done or the fair market value of materials supplied).
In my view, had the Tribunal jurisdiction to determine this quantum meruit claim the basis of the claim would be made out. However, in my view the Tribunal here, in the circumstance where the dispute is not a domestic building dispute and is a minor commercial building dispute but not a claim or dispute arising between a building owner and a building contractor relating to the performance of reviewable commercial work or a contract for the performance of reviewable commercial work.
In my view a quantum meruit claim is not properly so characterised. It does not relate to the performance of reviewable commercial work or a contract for such work.
The respondent in part relied on Sopov v Kane Constructions Pty Ltd (No2) [2009] VSCA 141 (15 June 2009) on the basis that the entitlement to claim quantum meruit following the acceptance of repudiation is supported by high authority of long standing[10] and that an entitlement to a profit margin is entirely consistent with the restitutionary objective of measuring the value of the benefit conferred and the inclusion of a margin for profit and overhead means that the calculation approximates the replacement costs of the works.
[10]Iezzi Constructions Pty Ltd v Watkins Pacific (Qld) Pty Ltd [1995] 2 Qd R 350, 361.
Byrne J in Brenner v First Artists Management Pty Ltd[11] said:
The assessment then, must have regard to what the defendant would have had to pay had the benefits been conferred under a normal commercial arrangement. The enquiry is not primarily directed to the cost to the plaintiff of performing the work since the law is not compensating that party for loss suffered…But this is not to ignore these costs for the reasonable remuneration for work must have some regard to the cost of its performance…
[11](1992) 2 VR 221.
The respondent in support of his counter claim has tendered a series of invoices from suppliers of materials said to be used on the build. The list of suppliers and the totals of those invoices are contained in B1, B2 and B3 to exhibit 5. Included are 12 claims from the respondent. In the list of appendages to that exhibit it is claimed pages 1-60 in appendage FF are in respect of ‘wages paid to the builder and employees on the job at Swann street job’. In fact, the pages are invoices from Darren Layt Carpentry and Joinery, a record of hours for employees, invoices from the respondent and invoices from East Coast Apprenticeships. It is not possible from those documents to reconcile the claims made and contained in the appendages. The tribunal is not easily able to reach a conclusion about the fair value of any benefit provided to the applicant other than the amount paid by the applicant.
However, it is not necessary to reach such a conclusion because for the reasons given the Tribunal does not have jurisdiction to determine the quantum meruit claim.
The claims and the counter claims are dismissed.
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