Castro v Queensland Building and Construction Commission [2025] QCAT 147

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL CITATION: Castro v Queensland Building and Construction Commission [2025] QCAT 147 PARTIES: ADAM CASTRO (applicant) v QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION (respondent) APPLICATION NO/S: GAR661-23 MATTER TYPE: Building matters DELIVERED ON: 28 April 2025 HEARING DATE: 15 November 2024 HEARD AT: Brisbane DECISION OF: Member Bertelsen ORDERS: The decision of the Queensland Building and Construction Commission dated 26 July 2023 declining coverage in respect of structural defective building work is confirmed. CATCHWORDS: PROFESSIONS AND TRADES – BUILDERS – STATUTORY POWER TO PROVIDE INSURANCE COVER FOR DEFECTIVE OR INCOMPLETE BUILDING WORK – where the Queensland Building and Construction Commission declined to provide cover in respect of undisputed structurally defective building work – where an owner applied to the Tribunal to review the decision – where an owner considered such building work to be primary insurable work under the Queensland Building and Construction Commission Regulation Queensland Building and Construction Commission Act 1991 (Qld), s 67WA, s 67WB, s 67WC, s 67WE, s 67X Queensland Building and Construction Commission Regulation 2018 (Qld) s 26, s 28, s 29, schedule 6 s 16 APPEARANCES & REPRESENTATION: This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) Applicant: King & Wood Mallesons Respondent: Suliana Tabaiwalu Principal Lawyer -- 1 of 4 -- 2 REASONS FOR DECISION [1] By application filed 20 September 2023 the applicant Adam Castro (‘Mr Castro’) seeks review of the decision of the Queensland Building and Construction Commission (‘Commission’) declining to provide cover under the Queensland Home Warranty Scheme (‘Scheme’) in respect of what he asserted at the time to be structurally defective building work related to waterproofing of the basement undertaken at Mr Castro’s property situated 1/94 Monaco Street Broadbeach Waters (‘the site’) by Rockwell Group Constructions Pty Ltd (‘Rockwell’) in 2018. The Tribunal has since found Rockwell to be responsible for structurally defective building work at the site and that a direction to rectify ought to be issued to Rockwell. Background and Evidence [2] On 26 July 2023 the Commission made firstly a decision not to issue a direction to rectify in respect of four complaint items made by Mr Castro about basement waterproofing at the site address. Though it was not disputed that the four complaint items constituted structural defective building work, the Commission considered that in all the circumstances it would be unfair to issue any such direction. Secondly the Commission declined to provide cover for any of the four complaint items under the Queensland Home Warranty Scheme (‘Scheme’). On 20 March 2025 the Tribunal ordered that a direction to rectify be issued to Rockwell. In declining Scheme assistance, the Commission stated that none of the four complaint items fell within the definition of primary insurable work under the Scheme. [3] Mr Castro asserted that the basement waterproofing works amounted to primary insurable work within the meaning of section 67WC of the Queensland Building and Construction Commission Act 1991 (Qld) (‘QBCC Act’) because it involved “the erection or construction of a residence and/or building work within the building envelope of a residence”. The waterproofing work was building work because it involved the construction, alteration, improvement or repair of the basement of the property, a fixed structure, by Rockwell, a licensed contractor. The structure being affixed to land and used for residential purposes was a residence. Whether single detached or one of one or more attached dwellings it was a residence as defined in section 67WE of the QBCC Act. Mr Castro’s property could be construed as a single detached dwelling a description consistent with the QBCC’s own inspection report referring to “one of two detached dwellings on the property” and Gold Coast City Council’s description “two detached dwellings with partial third storeys”. Alternatively, the residence could be considered one of two attached dwellings separated by a common wall. [4] It was argued then the basement waterproofing works the subject of Mr Castro’s four complaints was building work performed for the construction (or within the building envelope of) a residence and on that basis was primary insurable work. Nor did the basement waterproofing works fall within the exclusions of primary insurable work in section 28 of the QBCC regulation. It was further argued that the Insurance Information Statement dated 22 March 2022 obtained by Mr Castro from the Commission confirming that policies were in place for coverage of Rockwell in relation to work performed at the property was at odds with the QBCC’s statement in its inspection report that such work was not primary insurable work. If Mr Castro was not to be afforded assistance through the Scheme, he would be left with no remedy having purchased a recently constructed property with structural building defects. -- 2 of 4 -- 3 [5] The Commission stated it undertook an insurance assessment of the four complaint items. Pursuant to section 67X(2) of the QBCC Act the Scheme was there to provide assistance to consumers of residential construction work for loss associated with work that was defective or incomplete. Mr Castro as subsequent purchaser was a consumer, and the work was residential construction work defined as primary insurable work pursuant to section 67WA of the QBCC Act. However, section 67WE of the QBCC Act included residence to also mean “a building of not more than 3 storeys, containing 2 or more separate residential units”. [6] A storey pursuant to section 67WE(6) meant a space within a building between one floor level and the next floor level. The Commission considered the question to be “was the construction of the property the construction of a residence as defined in section 67WE(1)(c) being a property of not more than three storeys”. It was put to the Tribunal that approved plans produced to the Tribunal showed four levels, a basement, ground floor, level one floor, and level two floor. Section 67WE(4) states that a regulation may prescribe how to calculate the number of storeys of a building. [7] Under section 29 of the Queensland Building and Construction Commission Regulation 2018 (Qld) (‘QBCC Regulation’), the number of storeys of a building is calculated by excluding one storey of the building if more than 50% of the floor area of at least one storey of the building is designed to accommodate motor vehicles. The Commission stated a calculation with respect to the basement was provided by Mr Castro. The basement consisting of a carpark, communications room and living area based on approved plans had a total area of 195.1m 2 . The carpark constituted 84.4m 2 (43.2% of the basement) and living areas 110.7m 2 (56.7% of the basement). The basement utilising only 43.2% as a carpark was therefore a storey rendering the dwelling a four-storey building and not a residence pursuant to section 67WE(1)(c). The Scheme could not be applied to this dwelling. [8] Alternatively, in further determining eligibility the Commission considered sections 67WE(1)(a) and 67WE(1)(b) providing for a residence to be accepted for Scheme insurance purposes if a single detached dwelling or one or more attached dwellings separated by a common wall assessing that the dwelling here was a single detached dwelling. The dwelling being a residence and the subject of primary insurable work assistance could be provided under the scheme. [9] However pursuant to section 16(1) of schedule 6 of the QBCC Regulation Mr Castro was only entitled to claim assistance under the scheme if he first became aware, or ought reasonably to have become aware of structural defect/s within 6 years and 6 months (statutory time frame) of the date of commencement of Scheme cover (which was 5 October 2017). Mr Castro having first become aware of structural defects on 15 December 2021 was therefore eligible to claim assistance under the Scheme. [10] Pursuant to section 16(3) of schedule 6 Mr Castro was then required to claim for structural defect/s within three months of 15 December 2021. He did not. Rather he lodged his complaint with the Commission on 8 August 2022 some 8 months later thereby disentitling himself to Scheme assistance. The Commission pointed out there was no provision in the Commissions governing act for extension of time frames. -- 3 of 4 -- 4 Conclusions [11] It is not disputed, albeit it appears latterly, that the residential construction work complained of is primary insurable work. The Commission in declining Mr Castro’s insurance claim considered what constituted a residence and the time frames applicable to such a claim. [12] The Tribunal accepts the evidence of the Commission regarding its assessment of the residence as a four-storey dwelling by reference to approved plans produced to the Tribunal and the minor percentage of the basement level applicable to carparking. For the purposes of section 67WE(1)(c) of the QBCC Act the dwelling is not a residence acceptable under the Scheme. [13] Pursuant to section 67WE(1)(a) of the QBCC Act the Tribunal agrees generally with the parties that the dwelling is a single detached dwelling and therefore an eligible residence. [14] Mr Castro became aware of structural defects on 15 December 2021 well within the 6-year 6-month statutory time frame (section 16(1) of schedule 6 of the QBCC Regulation) which commenced with Scheme insurance cover on 5 October 2017. At that point he was eligible for assistance under the Scheme. Pursuant to section 16(3) of that same schedule 6 he was required to claim for structural defects within three months of 15 December 2021. Unfortunately, he did not do so thereby disentitling himself to Scheme assistance. The QBCC legislation does not provide for an extension of time. [15] There does not appear to be any basis on which Mr Castro can be made eligible for Scheme assistance. Orders The decision of the Queensland Building and Construction Commission dated 26 July 2023 declining coverage in respect of structural defective building work is confirmed. -- 4 of 4 --