Fazlollahi v Iconic Line Constructions Pty Ltd [2026] QCAT 299

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL CITATION: Fazlollahi v Iconic Line Constructions Pty Ltd [2026] QCAT 299 PARTIES: SAMIRA FAZLOLLAHI (applicant) v ICONIC LINE CONSTRUCTIONS PTY LTD (respondent) APPLICATION NO/S: BDL198-23 MATTER TYPE: Building matters DELIVERED ON: 12 June 2026 HEARING DATE: 4 June 2026 HEARD AT: Brisbane DECISION OF: Member Alex Nelson ORDERS: 1. Iconic Line Constructions Pty Ltd is to pay Samira Fazlollahi the sum of $345,512.53 including damages in the amount of $296,700 and interest in the amount of $48,812.53. 2. It is declared that the Applicant had no liability to pay the Respondent’s invoice issued on 19 April 2023 in the amount of $50,911. 3. It is declared that the Applicant is entitled to the return of the $50,911 deposited by her to the trust account of Romans and Romans Lawyers on or about 2 May 2024. 4. The Respondent’s counter-application filed 18 December 2023 is dismissed. CATCHWORDS: CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – EXTRAS AND ALTERATIONS – where building owner and building contractor signed a contract for the construction of a new home - where the building contractor made a further claim for payment for site work claimed as a provisional sum as well as amount in addition to the provisional sum for unforeseen rock excavation – where the building contractor did not have the foundations data at the time of entering the contract where no variation was agreed - whether the building owner is obliged to pay that invoice – whether the -- 1 of 9 -- 2 contract was validly terminated by the building owner – whether the building owner is entitled to damages - whether the building owner is entitled to costs Queensland Building and Construction Commission Act 1991 (Qld), s 77, Schedule 1B s 3, Schedule 1B s 5, Schedule 1B s 31, Schedule 1B s 40 Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 57, s 92, s 93 APPEARANCES & REPRESENTATION: Applicant: Respondent: Self-represented No appearance REASONS FOR DECISION [1] This is a residential building dispute. [2] The Applicant purchased vacant land in Milton and set about organising the construction of a new house which I am satisfied was intended to be used by her as an investment property, in the sense that it was to be rented out through an agent once it had been constructed. Armed with plans and engineering drawings that had been prepared for the lot by a well-known residential construction company and firm of engineers, the Applicant sought and obtained tenders for the construction. She accepted a tender from the Respondent and they entered into a Home Industry Association (‘HIA’) standard form contract on 20 June 2022. [3] It was not a great start to that relationship when the Respondent recorded in the contract that the price excluding GST was $816,328, then added $90,703 (11.111%) for the GST component. [4] The relationship soured completely on about 19 April 2023 when the Respondent issued an invoice for ‘site works variation’ for the amount of $50,911. When the Applicant disputed that invoice, the Respondent purported to suspend its work under the contract and that suspension persisted for about one year until the parties reached a further agreement that: (a) the Applicant would pay the disputed amount to the trust account of the Respondent’s solicitors; and (b) the Respondent would complete the construction of the house. [5] Although the Applicant deposited those funds, the Respondent reneged on doing the further work, leading to the construction contract being terminated by the Applicant. [6] The Applicant retained a new builder to complete the construction of the house and she now seeks: (a) relief from payment of the invoice from the builder for disputed charges amounting to $50,911.11 and, by extension, the release of that amount from the funds held on trust by the Respondent’s former solicitors; (b) damages for delay in completing the construction at the contract rate of $50 per day; -- 2 of 9 -- 3 (c) damages for breach of contract where it became necessary to appoint a new builder to finish the construction work at an additional cost, less the amount of $200,000 which the Applicant had received from the Queensland Building and Construction Commission (‘QBCC’) under the Queensland Home Warranty Scheme; (d) damages for loss of rental income at the rate of $2,500 per week; (e) interest on the damages so awarded; (f) costs. Respondent Failing to Comply with Directions [7] The Respondent was directed to file a Response by 27 October 2023, but it did not do that until 19 December 2023 at which time it also filed a counter-application seeking payment of its disputed invoice. [8] On 26 August 2024 directions were made for the filing and delivery of statements of evidence. The Applicant complied but the Respondent did not do so. [9] On 25 November 2024 the date for the Respondent’s statements of evidence was extended, but still, it did not comply. [10] On 22 May 2025 the parties were directed to file and deliver an amended application and amended counter-application. The Respondent was given yet another opportunity to file and deliver its witness statements. Those directions provided that the parties would not be permitted to adduce evidence at the hearing that was not contained in the statements without justifying the need for such additional evidence to the Tribunal. Still the Respondent did not comply. [11] On 16 July 2025 the Tribunal again extended the date for the Respondent to file its statements of evidence. Again, it did not comply. [12] The time for the Respondent to comply was extended again on 22 September 2025 with a direction that a failure to comply may entitle the Applicant to a ‘final decision in the proceeding’. Still the Respondent did not comply. [13] On 7 November 2025 the Applicant applied for a decision by default but that was refused on 12 November 2025. It was, however, directed that the Respondent was not permitted to file an amended counter-application and was not permitted to file or rely upon any statements of evidence at the hearing which was then scheduled for 4 and 5 June 2026. [14] On 2 June 2026 it was directed that if the Respondent failed to attend at the hearing on 4 and 5 June 2026, the counter-application filed on 18 December 2026 would be dismissed. [15] Given the history of non-compliance by the Respondent, it came as no surprise that the Respondent failed to appear when the trial started on 4 June 2026. The Hearing Support Officer searched for the Respondent outside the hearing room but to no avail. Accordingly, I dismissed the counter-application. [16] The Tribunal may ‘act in the absence of a party who has had reasonable notice of a proceeding’ under the general powers in s 57 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (‘QCAT Act’). Further, under s 93 of the QCAT Act, the Tribunal may hear and decide a matter in a person’s absence, -- 3 of 9 -- 4 including where the person is a party, if the person has not attended a hearing and the Tribunal is satisfied the person has been given notice of the hearing under s 92. I was satisfied that a compliant notice had been sent to the Respondent and I proceeded with the hearing in its absence. [17] The Applicant gave her evidence and called her witnesses to give their evidence which plainly went unchallenged. Background [18] The contract included a progress payment schedule as follows: (a) deposit, $45,351; (b) site Cut, $63,492; (c) pool shell installed, $72,562; (d) slab pour, $136,055; (e) frame, $226,758; (f) enclose, $181,406; (g) fixing, $136,055; and (h) practical completion, $45,352. [19] Schedule 3 of the contract identified that the contract price included a Provisional Sum allowance of $60,000 for ‘Provide Site Works Allowance above standard Inclusions’. It also acknowledged that in order for that item to be included in the contract as a Provisional Sum, the amount that was included was a reasonable estimate of the price for the supply of the item and/or the work to be performed. [20] Following payment of the deposit and payment of an invoice for the construction of the swimming pool shell, on 12 October 2022 the Respondent issued an invoice for the ‘site cut’ for an amount which was identical to the progress payment amount at paragraph 18(b) above. On or about 6 October 2022 the Applicant had visited the site and was told by the Construction Manager that ‘there were no unusual conditions on site such as rocks or any other issues’. The Applicant paid the ‘site cut’ invoice and the construction continued. [21] The slab was constructed and the Slab Pour invoice was issued on 27 February 2023. That was paid in full, as was the Frame stage invoice issued on 5 April 2023. Site Cost Variation [22] On 19 April 2023 the Respondent issued an invoice for ‘site cost variation’, claiming the sum of $50,911 including GST. That invoice was not sent to the Applicant until a week later, at which point the Respondent immediately queried her liability to pay it. She received an email response in the following terms: total site and foundation cost $140,065.93 invoice on link below (please note some invoices sent after the works as we have varies account payment period up to 60 days account) [link] -- 4 of 9 -- 5 Our calculations for standard site and foundation cost $37,640 Slab area 282m2 Site prep,Concreting prep and pour, (no piers/special strip footing): $9,000 + $2,000 pump = $11,000 Concrete supply M type slab 57m3 @ $220/m3 = $12,540 Pods,reo,Steel bar : 282 units x $50 = $14,100 Provisional allowance for site cost over standard $60,000 I will fix the invoice dates [23] It should be noted, the contract does not contain any provision about the ‘standard site and foundation cost’ being $37,640. [24] The Applicant immediately challenged this invoice and asked to be provided with supporting documents. The Respondent then wrote, ‘As you reject paying the agreed completed extra works, we are putting the job on hold for 10 business days or more’. [25] The Respondent provided documents which it alleged supported the additional charges that were being levied, but: (a) two of the documents provided were quotes only, and there was no evidence they were ever accepted, let alone paid; indeed one of them had area for the respondent’s signature as a form of acceptance, but that was still blank; (b) a number of the invoices were plainly for works that were part of the ‘Slab Pour’ stage. [26] The Respondent gave a further explanation that during the site cut the Respondent had unexpectedly encountered rock, but of course that was at odds with the statement that had been made by the site supervisor on 6 October 2022. In addition, none of the supporting ‘invoices’ evidenced significant rock breaking or dumping activities. [27] Had it been the case that significant rock was rock was discovered and a variation to the contract was required because the price was to increase, the Respondent had an obligation under s 40 of Schedule 1B to the Queensland Building and Construction Commission Act 1991 (Qld) (‘QBCC Act’) to reach an agreement about the additional and unexpected work that was required and to put that into a written variation before the first of the following happened: (a) within 5 business days of that agreement being reached; and in any event (b) before any domestic building work the subject of the variation had started. [28] There was no agreement about the variation, nor was there ever a written version of the variation before the work was (allegedly) undertaken. [29] Another of the Applicant’s complaints about the invoice for ‘site cost variation’ was that clause 21.10 of the HIA contract provides: Where the provisional sum relates to excavation, footings or the slab, the builder is only entitled to claim an amount in excess of the allowance where the builder had the foundations data when the builder entered into this contract, the need for the additional amount cannot be established from that data. [30] The Applicant says that she cannot recall the Respondent seeking access to the property for site enquiries at any time before the contract was signed. She provided a -- 5 of 9 -- 6 chain of email correspondence with the Respondent on 1 August 2022 which made it clear that the Respondent was not in possession of the foundations data at that time, which was about 6 weeks after the contract had been signed. Even as late as 25 August 2022 the Respondent sent an email to the Applicant to the effect that it had been unable to get the soil test results. [31] I find that the Respondent had signed the contract with the Applicant at a time when the Respondent did not have the foundations data. I am fortified in that conclusion by the fact that the QBCC investigated the Respondent and then issued it with an infringement notice for breaching s 31(2) of Schedule 1B of the QBCC Act by failing to obtain the foundations data before entering into the contract with the Applicant. [32] I am not at all satisfied that the Respondent actually incurred the additional costs that it tried to claim from the Applicant, but even if those costs had been incurred, I am not satisfied that the Respondent had any entitlement to pass them on to the Applicant as a ‘site cost variation’ because it was not ‘site work’ and because the Respondent did not comply with s 40 of Schedule 1B of the QBCC Act. [33] On 6 June 2023 the Applicant referred the dispute to the QBCC. When the Respondent refused to engage, the QBCC issued a letter confirming that it was unable to assist further, thereby enlivening the jurisdiction of this Tribunal.1 [34] The Applicant filed an application for domestic building disputes in the Tribunal on 4 July 2023. Despite that, the Respondent’s ‘suspension’ of work continued through to the following year. [35] On 11 March 2024 the Applicant issued the Respondent with a notice to remedy breach. Clause 28.5 of the contract gave the Respondent five (5) working days to file an application in the QBCC or QCAT if it wished to prevent termination of the contract, but it did not take that step. [36] On 19 April 2024 the Applicant generously and sensibly offered to pay the amount of the disputed ‘site cost variation’ invoice to the trust account of the Respondent’s solicitors on the basis that the Respondent recommence work within 10 days and continue through to Practical Completion. On 1 May 2024 the Respondent accepted that offer and on the following day the Applicant duly deposited $50,911 to the trust account of Romans and Romans Lawyers. [37] On 20 May 2024, and then again on 29 May 2024, the Applicant sought confirmation that the Respondent had recommenced work on her property and sought a copy of the design and inspection certificates for the work that had been undertaken to that point. The Respondent gave no reply and the requested information and certificates were not provided. [38] Despite the agreement that had been made, the Respondent did not ever recommence work on the Applicant’s property. [39] On 5 June 2024 the Applicant terminated the contract and I find that termination was valid because: (a) the Respondent had suspended its works when it was not entitled to do so and that amounted to a substantial breach under clause 28.1 of the contract; 1 QBCC Act, s 77(2). -- 6 of 9 -- 7 (b) the Applicant had given the Respondent a notice to remedy breach; (c) the Respondent did not comply with that notice to remedy breach within 10 working days; and (d) the Respondent did not apply to set aside the notice to remedy breach. [40] On 7 June 2024 the Applicant made a claim for assistance under the Queensland Home Warranty Scheme and on 25 March 2026 the QBCC paid the Applicant $200,000 in respect of that claim. [41] The Tribunal has jurisdiction to hear and decide this building dispute, and to order various remedies under s 77 of the QBCC Act. Pursuant to s 77(3) of the QBCC Act the Tribunal can: (a) order the payment of an amount found to be owing by one party to another; (b) order relief from payment of an amount claimed by one party from 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 defective or incomplete tribunal work; (h) award costs. [42] I find that the Applicant had no liability to pay the invoice for ‘site work variation’ in the amount of $50,911 (or any amount). Accordingly, the funds held on trust by Romans and Romans Lawyers, together with any interest earned by the investment of those funds, should be released to the Applicant forthwith. Delay Damages [43] Clause 3 of the contract required the Respondent to reach Practical Completion within 340 calendar days from ‘Commencement’. [44] On 22 February 2023 the Respondent sent a notice of commencement of construction to the Applicant. Understandably, the Applicant objected to that notice and required the Respondent to issue a new notice of commencement of construction. The Respondent did so, claiming to have commenced work on 22 December 2022. The Applicant continued to object until eventually the Respondent gave a notice of commencement of construction with effect from 15 September 2022. Even that I do not accept as being an accurate record of when work actually commenced [45] The date of ‘Commencement’ was defined in clause 2.1 of the contract to mean the Anticipated Start Date stated in Item 14 of Schedule 1 of the contract. As that item was left blank by the parties, the contract’s default position was that ‘Commencement’ was 60 days from the contract date. As the contract date was 20 June 2022, I find that Commencement was 22 August 2022 and it follows that the date for Practical Completion was therefore 25 July 2023. That period was able to be extended pursuant -- 7 of 9 -- 8 to clause 17 of the contract if there were ‘claimable delays’, but I find that there were none. [46] Clause 32 of the standard form contract provided that late completion damages were payable at $50 per day from the due date for Practical Completion until the contract was brought to end, including by termination. [47] I find that the Applicant was entitled to late completion damages from 26 July 2023 until 5 June 2024, being a total of 316 days which equates to $15,800. Damages for Additional Costs to Complete the House [48] Having terminated her contract with the Respondent, the Applicant obtained three quotes from builders to complete the work and then selected the cheapest of the three, however that quote was for $896,346. There was a necessary variation to that contract attracting an additional amount payable of $5,207 in order to correct the misalignment of framing work that had been completed by the Respondent, making the total to be paid to the new contractor $901,553. That work has since been completed and those additional costs incurred. [49] GST on the Respondent’s contract price would ordinarily have been $81,632. There were agreed variations which totalled $66,911 inclusive of GST. The total price that was to be paid by the Applicant was therefore $964,871. [50] Disregarding the amount deposited to the Respondent’s solicitors’ trust account, the Applicant had paid the Respondent a total of $544,218. At the time of termination, there remained an amount of $420,653 that would have been payable to the Respondent, had it completed the construction work [51] I find that the Respondent is liable to pay the Applicant damages for breach of contract being the additional costs that the Applicant incurred in having the house construction completed by another builder ($901,553) less: (a) the $200,000 received from the QBCC under the Queensland Home Warranty Scheme; and (b) the amount that was remaining to be paid under the contract with the Respondent ($420,653). [52] I find that the Respondent is liable to pay the Applicant damages for breach of contract in the amount of $280,900. Damages for Lost Rental Income [53] The Applicant’s claim for loss of rental income for the period between expected Practical Completion and the date when the house construction was in fact finished by another builder was supported by a letter from a real estate agent giving the Applicant a rental appraisal of $2,500 per week, but the agent did not give a statement, nor were they called to give evidence at the hearing. Even putting those matters aside, I had no evidence about the agent’s expertise. [54] There was also no evidence to establish what the likely outgoings would have been had the property been available and been rented for that weekly amount. [55] At the hearing the Applicant abandoned that aspect of her claim. Accordingly, I dismiss the claim for damages for loss of rental income. -- 8 of 9 -- 9 Interest [56] Section 77(3)(c) of the QBCC Act provides that the Tribunal may award ‘interest on the damages at the rate, and calculated in the way, prescribed under a regulation’. Regulation 54 of the Queensland Building and Construction Commission Regulation 2018 (Qld) (‘QBCC Reg’) provides: (1) For section 77(3)(c) of the Act, interest is payable on the amount of damages awarded— (a) if the parties have entered into a contract—at the rate provided under the contract; or (b) at the rate agreed between the parties; or (c) otherwise—at the rate of 10%. (2) The interest is payable on and from the day after the day the amount became payable until and including the day the amount is paid. [57] The Applicant should have interest at the rate of 10% per annum upon the late completion damages from 5 June 2024 until 12 June 2026 being 738 days and equating to $3,192.15. [58] The Applicant should have interest at the rate of 10% per annum upon the damages payable for the additional costs that the Applicant incurred in having the house completed. That interest should run from the date that the Applicant contracted with the alternate builder, being 17 March 2025. That is 453 days and equates to $34,862.38. [59] The Applicant should have interest upon the monies that she was required to deposit to the trust account of the Respondent’s solicitors. There is no evidence that the sum deposited to the Respondent’s solicitors’ trust account was invested. In circumstances where there was clearly no proper basis for the ‘site work variation’ invoice to have been issued, and where those funds had been deposited in good faith after reaching a further agreement with the Respondent for the completion of the construction, I find that the Respondent should pay interest on that sum at the rate of 10% per annum from the date of its deposit, 2 May 2024 until 12 June 2026 being 772 days, amounting to $10,758. Costs [60] The parties may make written submissions about costs, including: (a) who, if anyone, should pay costs; (b) whether those costs should be assessed on a standard or indemnity basis; and (c) identifying the relevant court scale that should apply. [61] The Applicant has until 26 June 2026 to file and serve her submissions. [62] The Respondent has until 10 July 2026 to file and serve its submissions. [63] I will determine the issue of costs on the papers after that time. -- 9 of 9 --