Cristiano v Queensland Building and Construction Commission & Anor [2024] QCAT 451

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL CITATION: Cristiano v Queensland Building and Construction Commission & Anor [2024] QCAT 451 PARTIES: KRISTINE CRISTIANO, NICOLA CRISTIANO (applicants) v QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION (first respondent) AND CLARENDON HOMES PTY LTD (second respondent) APPLICATION NO: GAR103-22 MATTER TYPE: General administrative review matters DELIVERED ON: 4 October 2024 HEARING DATE: 19 and 20 June 2024 HEARD AT: Brisbane DECISION OF: Judicial Member JR McNamara ORDERS: The internal review decision of the Queensland Building and Construction Commission dated 21 February 2024 to not issue a direction to rectify is confirmed. CATCHWORDS: ADMINISTRATIVE LAW – ADMINISTRATIVE TRIBUNALS – QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL – general administrative review – where the applicant seeks to review a decision of the Queensland Building and Construction Commission (QBCC) – where the QBCC made an internal review decision to not give a direction to rectify to the builder – alleged defects in stormwater drainage system – whether there is defective building work – whether the builder is responsible for defective building work in relation to a stormwater drainage system – whether it is fair to give a direction to rectify to the builder Queensland Building and Construction Commission Act 1991 ss 71J, 72, 86 Queensland Civil and Administrative Tribunal Act 2009 ss 17, 19, 20 APPEARANCES & REPRESENTATION: -- 1 of 20 -- 2 Applicant: Self-represented, N Cristiano First Respondent: S Seefeld of Counsel instructed by Holding Redlich Lawyers Second Respondent: L Watt, Becker Watt Lawyers REASONS FOR DECISION [1] This matter concerns an application by Nicola and Kristine Cristiano (Cristianos) to review an internal review decision (Internal Review Decision) of the First Respondent, Queensland Building and Construction Commission (QBCC), not to give a direction to rectify to the Second Respondent, Clarendon Homes (Clarendon) pursuant to section 72 of the Queensland Building and Construction Commission Act 1991 (QBCC Act) for works undertaken by Clarendon at the Cristiano’s property. [2] The Internal Review Decision was an internal review of an original decision made on 15 November 2021 by the QBCC where the decision-maker decided to give a direction to rectify (Original Decision). The Internal Review Decision the subject of this application was made by Ms Padurean dated 21 February 2022. [3] The Cristianos seek a decision to direct Clarendon to rectify works at their property. Background [4] On 12 April 2017, the Cristianos and Clarendon entered into a written contract (Contract) for the construction of a lowset brick veneer dwelling at the Cristiano’s property at Oxenford in the amount of $460,745.00, and a corresponding building agreement (Building Agreement). The Building Agreement included, relevantly, that Clarendon would: “… 1.3 Provide Stormwater Drainage lines (100mm Dia) to street connection point … 1.9 Provide field gully traps 5No as positioned on site plan …” [5] The work was completed on 21 December 2017. The final payment on the contract was also made on 21 December 2017 and there is no amount outstanding. Statutory framework The role of this Tribunal [6] Section 17 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act) describes this Tribunal’s review jurisdiction: “(1) The tribunal’s review jurisdiction is the jurisdiction conferred on the tribunal by an enabling Act to review a decision made or taken to have been made by another entity under the Act. (2) For this Act, a decision mentioned in subsection (1) is a reviewable decision and the entity that made or is taken to have made the decision is the decision- maker for the reviewable decision.” -- 2 of 20 -- 3 [7] Section 86(1) of the QBCC Act confers jurisdiction on this Tribunal to review certain decisions it makes, including, relevantly, decisions to give a direction to rectify or remedy or to not give the direction. [8] The Tribunal must decide the review in accordance with the QCAT Act and the QBCC Act; it may perform the functions conferred on the Tribunal by the QCAT Act or the QBCC Act; and it has all the functions of the original decision-maker, being the QBCC, for the reviewable decision being reviewed.1 [9] The role of the Tribunal is to produce the correct and preferable decision by way of a fresh hearing on the merits of the case.2 It is not necessary for an error to be identified in the decision being reviewed.3 [10] In making its decision, the Tribunal must be satisfied on the balance of probabilities. [11] The Tribunal can make orders to: (a) confirm or amend the Internal Review Decision; (b) set aside the Internal Review Decision and substitute its own decision; or (c) set aside the Internal Review Decision and return the matter for reconsideration to the decision-maker for the decision, with the directions the Tribunal considers appropriate. The QBCC Act [12] The objects of the QBCC Act include, relevantly: (a) regulation of the building industry; (i) to ensure the maintenance of proper standards in the industry; and (ii) to achieve a reasonable balance between the interests of building contractors and consumers; (b) to provide remedies for defective building work; (c) to regulate domestic building contracts to achieve a reasonable balance between the interests of building contractors and building owners; and (d) to provide for the proper, efficient and effective management of the QBCC in the performance of its functions. [13] The QBCC’s power to issue a direction to rectify or remedy is set out in s 72 of the QBCC Act. Relevantly, the power will be enlivened if the QBCC is of the opinion that building work is defective or incomplete, or that consequential damage has been caused by, or as a consequence of, carrying out building work.4 1 QCAT Act s 19. 2 Ibid s 20. 3 Cowen & Anor v Queensland Building and Construction Commission & Anor [2017] QCAT 416, [18] citing Kehl v Board of Professional Engineers of Queensland [2010] QCATA 58, [9]. 4 QBCC Act, s 72(1). -- 3 of 20 -- 4 [14] Where building work is defective or incomplete, the QBCC has the power to direct the person who carried out the building work to rectify the building work within the period stated in the direction.5 [15] In deciding whether to give the direction, the QBCC may take into consideration all the circumstances it considers are reasonably relevant and, in particular, is not limited to a consideration of the terms of the contract for carrying out the building work (including the terms of any warranties included in the contract).6 [16] The QBCC is not required to give the direction if it is satisfied that, in the circumstances, it would be unfair to the person to give the direction.7 [17] The QBCC’s direction to rectify or remedy has some limitations. Relevantly, a direction cannot be given more than 6 years and 6 months after the building work to which the direction relates was completed or left in an incomplete state unless the tribunal is satisfied, on application by the QBCC, that there is in the circumstances of a particular case sufficient reason for extending the time for giving the direction and extends the time accordingly.8 The complaint [18] On 6 July 2021, the QBCC received a complaint from the Cristianos in relation to alleged defective work carried out by Clarendon at the property (Complaint). The QBCC and the Cristianos exchanged email correspondence requesting and providing further information in relation to the Complaint. [19] The below table summarises the items in the Complaint:9 Item Date Noticed Item Location Item Description (as quoted from the Complaint) 1 01/01/2018 External Stormwater has backfall; grass always damp; rising damp on brickwork; floods into pool; 100mm pipe down to 90mm pipe as per contract; incorrectly installed; enough fall over land to get fall. 2 01/12/2017 Laundry No floorwaste; Plumbing not in accordance with AS3500. 3 01/12/2017 Ensuite Tiles behind the mirror are not all the way to ceiling as per the contract. 4 01/12/2017 House Entire house brickwork terribly laid causing shadows day and night. 5 Ibid s 72)(2). 6 Ibid s 72(3). 7 Ibid s 72(5). 8 Ibid s 72A(3). 9 Ex 1, SOR-7, 267-269. -- 4 of 20 -- 5 Late lodgement of the complaint [20] Section 71J(4) of the QBCC Act allows consumers to request the QBCC to give a direction to rectify defective building work if the request is made within 12 months of the person becoming aware of the defect/s. [21] The QBCC ‘Rectification of Building Work Policy’ (Rectification Policy) was made on 16 May 2014 and took effect on 10 October 2014. The Rectification of Building Work Policy continues to be in force under section 76, Schedule 1 of the QBCC Act as the matters provided for under the policy have not yet been prescribed by regulation. The policy defines ‘defective building work’, ‘non-structural defective building work’ and ‘structural defective building work’.10 [22] Section 71J(4) is reflected in the Rectification Policy which states, at section 3, that a consumer seeking rectification must lodge a formal complaint with the QBCC as soon as possible but no later than 12 months of becoming aware of the alleged defects. [23] The work was completed on or about 21 December 2017 and the Cristianos said that they became aware of the defect in relation to the pipework shortly after completion on or about 1 January 2018. However, the Cristianos did not lodge a formal complaint for approximately another 3.5 years. [24] The QBCC does not require a complaint to be lodged to exercise its power to issue a direction to rectify. As noted already section 72 allows the Commission to issue a direction if it is ‘of the opinion that building work is defective or incomplete, or that consequential damage has been caused by, or as a consequence of, carrying out building work’. Therefore, despite the late lodgement of the Cristianos’ complaint, the QBCC and therefore, this Tribunal, is able to form an opinion on the basis of the material provided by the parties and exercise the powers conferred by section 72. Assessment of the complaint by QBCC [25] On 5 November 2021, QBCC building inspector Cornelius Koen, assisted by Specialist Technical Expert engaged by QBCC, Mr Theslow of BT Plumbing Services, carried out an inspection at the property to assess the complaint items. Mr Koen made an audio-recording of his inspection and subsequently completed an “Initial Inspection Report” dated 11 November 2021 (QBCC Building Inspection Report). [26] Mr Theslow completed an inspection report dated 10 November 2021 (1st Theslow Report). Mr Theslow’s inspection included a CCTV inspection down “both main (stormwater drainage) lines”. [27] On 15 November 2021, the QBCC issued a Decision to Rectify and/or Complete Work to Clarendon (Original Decision), in relation to Complaint Item 1, for the following: “ 1 The stormwater system on the left and right hand sides of the dwelling is not installed in accordance with AS3500:3:2018 sections 5.5 and 6.3.4, as the pipe size is reduced, the stormwater line is not installed and laid with even gradients and straight runs, and the lines are punctured (damaged) 10 Hearing Book, SOR2, 48-51. -- 5 of 20 -- 6 at multiple locations, posing a health and safety hazard to the dwelling’s occupants. Pertains to item number 1 of the QBCC complaint form.” [28] The QBCC advised the Cristianos that a Decision to Rectify and/or Complete Work was issued in relation to Complaint Item 1 but not Complaint Items 2, 3 and 4. [29] On 13 December 2021, the QBCC received an email from Clarendon’s representative requesting an internal review of the Rectification Direction (Internal Review). The email attached a building inspection report dated 4 December 2021 prepared for Clarendon by Datum Building Consultancy (Datum Report). [30] On 11 February 2022, QBCC Technical Officer Steven Noble completed a desktop assessment and report for Complaint Item 1 (only) (1 st Noble Report).11 The report concluded that the complaint item was determined not to fall within the definition of “defective building works” in accordance with the Queensland Building and Construction Commission Act 1991, the Queensland Building and Construction Commission Regulation 2018, and the QBCC Rectification of Building Work Policy, December 2014. [31] On 21 February 2022, QBCC Principal Review Officer Ms Padurean made the Internal Review Decision, being a decision not to give a direction to rectify to Clarendon.12 In the Internal Review Decision, in response to the rhetorical question: “Is the building work defective?” the decision notice states “The review officer accepts and relies on Mr Noble’s findings, whom (sic) determined that the complaint item did not fall within the definition of defective building work as explained below:”.13 The decision notice then sets out the findings of the QBCC Technical Officer Mr Noble from his report in full.14 As explained below, Mr Noble was unavailable to give evidence at the hearing. Ms Padurean’s Internal Review Decision also asked and answered the question: Is it fair and reasonable to give a direction to rectify to the applicant? Ms Padurean at paragraph [49] decided it would not be fair and reasonable to give a direction to rectify to Clarendon for the reasons she sets out at paragraphs [36] to [48] of her decision. The review application [32] On 21 March 2022, the Cristianos filed a review application in this Tribunal seeking to review the Internal Review Decision. [33] On 4 October 2022, Mr Theslow (BT Plumbing) was again engaged by QBCC to carry out an inspection of the Cristiano property to locate the approximate position of, and condition of, the stormwater drainage system installed for the swimming pool, the shed, the retaining walls (and the connection point for each) and prepare an inspection report about his findings. He attended the property 8 November 2022 and produced an inspection report (2nd Theslow Report) dated 15 November 2022.15 [34] A Statement of Steven John Noble dated 2 December 2022 is found in the hearing book.16 At page 539 paragraph [8] Mr Noble says that on 8 November 2022, he attended at the Cristiano property while BT Plumbing Services completed a 11 Hearing Book, SOR21. 12 Ibid, SOR24. 13 Internal Review Decision Notice, [34]. 14 Hearing Book, SOR21. 15 Hearing Book, 533. 16 Ibid 537. -- 6 of 20 -- 7 reinspection. Arising from that attendance he prepared an Internal Review Inspection Report dated 1 December 2022 (2nd Noble Report).17 [35] The 2nd reports of Mr Theslow and Mr Noble, which post-date the 21 February 2022 Internal Review Decision, address “additional areas connected to the stormwater service which was not part of the original stormwater service supplied by the house builder”18 and “… to document the extent of building works undertaken by the applicant and second respondent for consideration through the review proceeding …”.19 The hearing [36] The matter was heard in Brisbane on 19 and 20 June 2024. The hearing book comprised the QBCC’s Statement of Reasons together with attachments SOR1-26; the applicants’ evidence being the statement of Nicola and Kristine Cristiano together with sketches and photographs; the first respondent QBCC’s evidence including the statement of Mr Theslow (BT Plumbing Services) together with attachments including his first (10 November 2021) and second (15 November 2021) reports; and the statement of Mr Noble, Manager, Technical Services Unit of QBCC who produced the 1 st Noble Report dated 11 February 2022 (desktop review) and a 2 nd Noble Report dated 1 December 2022 (Internal Review Inspection Report). The hearing book also contained the evidence of 2nd respondent Clarendon Homes including the statement of Mr Farmer, retired building manager with Clarendon Homes; the statement of Mr O’Reilly, former Warranty Manager with Clarendon Homes; and the Hydraulic Assessment Report prepared by Mr O’Regan for Clarendon Homes on 26 July 2023. [37] At the hearing the following persons appeared and gave evidence: Mr Cristiano for the applicants; Mr Theslow for the QBCC; and Mr Farmer, Mr O’Reilly, and Mr O’Regan for Clarendon Homes. Mr Noble was unable to appear at the hearing due to a significant health issue. The parties were aware of Mr Noble’s inability to appear prior to the hearing. [38] There was no evidence from any member of the construction crew who built the house and installed the stormwater system. Issues to be decided [39] Although the initial complaint included other matters of concern to the Cristianos, it is the stormwater system (only) which was the subject of the Internal Review Decision, and accordingly the subject of this review. [40] In order to issue a direction to rectify under s 72 of the QBCC Act, the decision- maker (in this appeal, the Tribunal) must be satisfied that: (a) building work has been carried out; (b) the building work is defective; (c) the person responsible for the defective ‘building work’ is the second respondent; 17 Ibid 569. 18 Ibid 533. 19 Ibid 569. -- 7 of 20 -- 8 (d) it is fair, in all the circumstances, to issue a direction to rectify; and (e) a direction to rectify will be given within 6 years and 6 months after the building work was carried out unless the Tribunal is satisfied that there is, in the circumstances, sufficient reason for extending the time for giving the direction. Has building work been carried out? [41] Building work includes, as relevant in this case, the erection or construction of a ‘building’.20 ‘Building’ is in turn defined as ‘generally, includes any fixed structure’.21 [42] The stormwater system is building work.22 Is the building work defective? [43] The Rectification Policy relevantly provides that: (a) defective building work means building work that is faulty or unsatisfactory, and includes, for example, work that does not comply with … an applicable Australian Standard; (b) non-structural defective building work means defective building work (other than structural defective building work or residential construction work causing subsidence) that is faulty or unsatisfactory because: (i) it does not meet a reasonable standard of construction or finish expected of a competent holder of a contractor’s licence of the relevant class; or (ii) it has caused a settling in period defect in a new building. [44] The Australian Standard relevant to stormwater drainage is AS3500.3.2018, Section 5: Surface Drainage Systems – Design. Agreed Works [45] The 1st Noble Report (Internal Review Desktop Report 11 February 2022) referred to the Construction Final Consolidation 17 June 2017 and in relation to the scope of works: • provision of 100mm diameter drainage lines to the street (1.3), and • provision of 5 field gully traps as per the site plan (1.9), • the client is responsible for turf or vegetation … • the client is required to retain/stabilize cut and fill after practical completion (4.59) [46] Pursuant to the 12 April 2017 Home Building Agreement the parties agreed: • No allowance for onsite detention or hydraulic engineering of stormwater where required by local government (3) • Connections-stormwater up to 800m2 Lot. 20 QBCC Act sch 2. 21 QBCC Act sch 2. 22 T1-9, line 9. -- 8 of 20 -- 9 The Australian Standard [47] The original decision to give a direction to rectify referenced AS3500 and the application of the Nominal Method – which, according to the standard, may be used for single dwellings… with less than 1000m2 in area. Where the Nominal Method is used, pipe design shall be determined according to local practice and experience (without specific design calculations), and according to the minimum diameter, cover, gradient and other relevant criteria of the Standard. [48] The Cristiano’s property is a single dwelling on a 4460m2 parcel of land. [49] In an opening statement Mr Watt for Clarendon said: “In the original decision it stated that it was inappropriate to use the nominal method, however, Mr Noble determined that when considering the contractual relationship between the parties and the definition of “site” that’s contained within the contract, and that definition was applied, which it is being the whole or that part of the land required reasonably by the builder for the carrying out and completion of the works, the builder worked on less than 1000 square metres, and accordingly it was upon the applicant to turn their minds to the matter of the balance of the site and its stormwater requirements once that had been – the work by Clarendon had been completed.”23 [50] Mr Watt also noted that the Cristiano property is part of an overland flow channel and the concern expressed by Mr O’Regan (Hydraulic Assessment Report) who attended the property and conducted a visual inspection “from beyond the front and rear boundaries” noting the significant area outside the allowable area for the application of AS3500 nominal stormwater system, and his view that a hydraulic design would be appropriate to cope with overland flow issues.24 Clarendon say that the responsibility for commissioning hydraulic design is for the owner. [51] The scope of works and contract terms referred to at [45] and [46] above appear designed to avoid the application of AS3500 by agreeing that the land area is less than 1000m2, despite the parcel being 4460m2 and subject to significant overland flow. This does question the value of AS3500. [52] In this case Clarendon contracted to operate on an 800m2 site within the allotment which allowed the Nominal Method to be adopted in that area.25 For the remainder of the allotment, it would be for the landowner to undertake hydraulic design. [53] On this basis the finding of the 1st Noble Report that AS3500 would apply to the Cristianos property was accepted in the Internal Review Decision. In doing so, the Internal Review Decision reversed the finding of the Original Decision which was that AS3500 was not applicable to this property. [54] The fact that there are defects in the stormwater system installed by Clarendon is unchallenged. The defects described in the 1st Theslow Report (10 November 2021), are that there were punctures through the top of the pipe on the left side of the house; the pipe reduces in size from 100mm to 90mm near the kerb; the pipe is crushed on the left side outlet at the kerb; a joint in the pipe is split and is leaching groundwater into the pipe at the front of the house near the front right corner; the pipe is holding 23 T1-19, lines 7-15. 24 T1-22. 25 See paragraph [42]. -- 9 of 20 -- 10 water for a large percentage of the stormwater service; and staining or mould consistent with a leak on the branch line was observed. The 21 February 2022 Internal Review Decision concludes that the works undertaken by Clarendon were “not defective building works”, that is, the review officer was not satisfied that Clarendon was responsible for any damage to the stormwater system. Is Clarendon responsible for the defective ‘building work’? [55] The QBCC say this is a matter that needs to be resolved in this case. It is the case that the stormwater system installed by Clarendon is “building work”; and that Clarendon is responsible for the “building work”. Whether Clarendon is responsible for the defects in or to that building work is another question. [56] The house is a lowset brick house. The 4460 square-metre property is almost triangular shape, wide at the back, narrow at the front. The house that was built by Clarendon sits at the front of the property. The land falls in elevation from the rear of the property to the front. During construction an area of approximately 800 m2 was cordoned off with temporary fencing. The property has dual access, that is access from the bottom of the property closest to the house, and access from Tamborine- Oxenford Road at the top of the property. [57] There were about 4 years between the construction of the stormwater system and the initial QBCC inspection which confirmed defects in the system. [58] The Cristianos say they first noticed a problem with the stormwater system in January 2018 although a claim was not made until January 2021. [59] A significant amount of work was carried out on the allotment by or at the direction of the Cristianos during and after the construction of the house. However, the Cristianos did not access the 800 square-metre cordoned of building site for any of their landscaping activities until after Clarendon’s completion of the build. Clarendon had control of the building site for a period of 8 months. During that time there would have been a significant amount of movement of labour and building materials moved manually and mechanically by Clarendon within the 800 square-metre building site - and on and over the stormwater system trenches that had been backfilled early in the construction process. [60] The Cristianos say that the stormwater system was not properly installed and that the activities of Clarendon on site during construction caused the defects. [61] Clarendon suggest that the works carried out during and following construction by or on behalf of the Cristianos likely damaged the system, and aspects of the complaint are the result of additional stormwater loading connected by the Cristianos that exceeded the capacity of the agreed system. [62] In evidence Mr Cristiano described what he understood to be the usual building practice as follows. Prior to a slab being poured, trenches are dug for services, drainage and stormwater; aggregate is placed in the trenches to support and protect the pipework; the drains and pipes are then installed; and the trenches are backfilled. The pipe work sits at approximately 600 mm beneath the surface, and deeper in some places. [63] It is not asserted by the Cristianos that the stormwater pipes are broken or distorted (apart from those near the kerb). It is rather suggested that they were not laid correctly -- 10 of 20 -- 11 – “It’s either sunk or the trench hasn’t been dug correctly”.26 It was also suggested by the Cristianos that the pipe work was not protected from impacts by aggregate. As a result it was claimed that the (8 month) building process and the movement of heavy machinery around the building site by Clarendon would have affected the stormwater pipe levels resulting in backfall; and/or as a result of “over excavation” that was not managed by the proper use of compacted crusher dust to ensure a pipe doesn’t ‘drop’ when compacted if the soil beneath the pipe is soft.27 [64] In response to the suggestion that the displacement of stormwater lines was caused by the movement of heavy machinery on site “post handover” (by or on behalf of the Cristianos), Mr Cristiano said that the machines he owns and operates “are smaller than what was used on that property prior to … receiving the keys”.28 [65] In an email to then Clarendon Warranty Manager Mr O’Reilly, in response to the denial by Clarendon of the warranty claim, the Cristianos say that the primary issue is that the pipework has been installed as a charged service (that is, one which retains water where there is insufficient fall) when there is no issue with fall; there is 1450mm fall “from top of concrete to invert of kerb”; the pipes constantly hold water and do not flow”; and the pipework reduces in size from inside the property to the kerb. [66] In evidence, former Clarendon Building Manager Mr Farmer said that the system would not have been designed to be a charged line; because of the levels it becomes a charged line; he was surprised that it was a charged line; however a charged line would still operate to discharge water from the system.29 When question about the movement of vehicles and supplies on site by Clarendon Mr Farmer notes that he was not on site but that usually a truck would deliver supplies such as bricks and tiles near to the building and place them on the ground, a smaller lightweight bobcat is then used for the movement of those goods around the site.30 He said that concrete is delivered by pump – that is there would not be a vehicle close to the building site. The stormwater system [67] Former Clarendon Warranty Manager Anthony O’Reilly in his 1 June 2023 statement says that building construction finished in December 2017. A warranty claim by the Cristianos in August 2018 did not pertain to the stormwater system – but a claim in March 2021 did. Mr O’Reilly said that Clarendon provisioned for a “limited stormwater system” to provide drainage to the land immediately surrounding the home. The Cristianos indicate that they noticed their stormwater concerns in January 2018.31 [68] An “As constructed _Stormwater Drainage Schematic” is included in the material filed by Clarendon.32 The schematic was said to be part of the complaint form which was filed by the Cristianos with the QBCC. The sketch shows two stormwater pipes shaded/highlighted in yellow. One runs from the back of the property down the right to the curb onto the street, and the other one runs from the back of the house on the left and runs around the left-hand side, around the front of the house and down to the street. It also shows the five (5) yard gullies installed by Clarendon, as well as four (4) additional yard 26 T1-96, line 34. 27 T1-105, line 23. 28 Hearing Book, 222. 29 T2-19; T2-20. 30 T2-22; T2-23. 31 Hearing Book, 269, email from N Cristiano to the QBCC dated 26 July 2021. 32 Ibid, 269. -- 11 of 20 -- 12 gullies installed by the Cristiano’s subsequent to the completion of construction of the house, which feed into the “Clarendon” stormwater system. The defects [69] The 1st Theslow Report (BT Plumbing 10 November 2021) noted the following during the inspection on 10 November 2021: • Three punctures through the top of the pipe were noted on the left side of the house, in the garden bed near the entry to the house. • The main pipe reduces in size near the kerb from 100mm to 90mm pipe with a small amount of tree roots evident in the pipe. • The pipe is crushed on the left side outlet, at the kerb adaptor. • A joint in the pipe is split and is leaching ground water into the pipe at the front of the house near the front right corner. • The pipe is holding water for a large percentage of the stormwater service, to varying depths, up to full pipe depth in some locations, noticeably the front left corner of the house. • A junction for the downpipe on the rear right corner of the house, near the pool has a large amount of staining or mould in the junction, consistent with a leak on the branch line. Further investigation by removing this downpipe is required to determine the cause. The owner expressed concerns regarding the pipe sizing and backfall in the pipework. As noted above, the pipework has areas of full pipe depth backfall. In regard to pipe sizing, AS3500.3 2018 section 5.5 notes that the Nominal Method, which is when pipe design is determined according to local practise and experience (without design calculations) can only be used on urban allotments with less than 1000m2 in area. RP data shows this property is 4460m2 which would require design calculations on pipe sizing. A site plan including house measurements would be required to ascertain the exact pipe sizing requirements needed. However, the reductions in pipe sizing at the kerb and the sections of drain holding water would slow the flow of water out of the system and may contribute to the alleged temporary flooding around the outside of the house. [70] The direction arising from the original 15 November 2021 decision to give a direction to rectify stated: The stormwater system on the left and right sides of the dwelling is not installed in accordance with AS3500:3:2018 sections 5.5 and 6.3.4, as the pipe size is reduced , the stormwater line is not installed and laid with even gradients and straight runs, and the lines are punctured (damaged) at multiple locations, posing a health and safety hazard to the dwelling’s occupants. Pertain to item number 1 of the QBCC complaint form. [71] The observations of Mr Theslow described in his 1st report regarding the stormwater system installed by Clarendon are not challenged. Works carried out other than by Clarendon [72] There were some other works which were carried out at around the same time and subsequent to the house being built. In particular, the evidence shows these works included the construction of a large shed behind the house, the installation of an in- ground swimming pool adjacent to the house, the laying of a concrete pad and driveway above and adjacent to the house, the construction of some retaining walls behind the house and some contouring of the land. I accept that the evidence confirms that the pool and major concreting works were undertaken after practical completion of the house. -- 12 of 20 -- 13 [73] At the hearing after commenting that there had been much “finger pointing” at the “other works” carried out on the property (as responsible for the issues), Mr Cristiano says that “there was a lot of traffic” over and around the area of the house during construction, after the stormwater pipes had been laid. He said: “… you’ve got concrete pumps coming in, concrete trucks, frames being delivered, bricks being delivered, roof tiles being delivered. All those have been vehicular access to the property, which, at the time, the trenches would have been fresh, not completely compacted…”. After saying he was a plumber with 30 years experience he said he used a camera to inspect the pipes. He continued: “There’s no broken pipes in the sense that it’s been crushed and cracked. There’s a lot of backfall on majority of the pipework… if I was to guess a percentage, best part of 70 per cent of the pipework as backfall, which, as per the code states, must be laid with appropriate 35 gradient and also backfilled with appropriate material.”33 Other possible impacts on the stormwater system [74] Clarendon had engaged a number of experts to provide reports on a range of matters that might have an impact on the stormwater system. Thes include landscaping works which affect overland flow, stormwater loading added into the Clarendon system after installation, and increased imperviousness from the laying of concrete. [75] Mr O’Regan (MORA Consulting) was the co-author of a Hydraulic Assessment Report (Stormwater Drainage) 26 July 2023 commissioned by Clarendon. Included in the documents reviewed in preparing the report was a Post-Construction Survey Plan (by Kevin Holt Consulting) showing the completed construction of the residence by Clarendon as well as the additional construction completed by the owners, including, but not limited to: • A 200m2 shed with a concrete landing adjacent the entry. • A fenced inground swimming pool and tiled surround. • A 1.5m wide concrete footpath surrounding the residence. • Multiple retaining walls along the upslope end of the shed, swimming pool and corner of the residence. • A 5m wide concrete driveway from the front property boundary making its way along the southern boundary along the house to the rear shed landing. • 14 additional stormwater gully pits. • There is no evidence of additional inground stormwater drainage or upgrades to the existing stormwater drains due to the nature of the survey. [76] The report includes the following two tables, Roof Catchment Stormwater Loading, and under the heading “additional Impervious Areas” a Site Imperviousness table. 33 T1-15, lines 21 – 24. -- 13 of 20 -- 14 Table 5.1 – Roof Catchment Stormwater Loading Catchment Roofed Area (m2) 1in20 (mm/hr) Flow Rate (L/s) Works by Clarendon Homes Residence 511 242 34.35 Works By Owner Shed 207 242 13.92 Total 718 48.27 Table 5.3 – Site Imperviousness Area Impervious Area Imperviousness of total site (%) Works by Clarendon Homes Residence 511 11.46 Works by Owner Shed 207 4.64 Driveway 508 11.39 Footpath (house) 143 3.21 Swimming Pool 93 2.04 Total 1,462 32.78 Additional stormwater loading [77] The conclusion drawn in the report is that the “increased stormwater loading on the inground stormwater drainage created by the additional roofed area is approximately 40%”; and the additional 14 stormwater gully pits resulted in additional stormwater load on the drainage system installed by Clarendon. Mr O’Regan expressed the view that the pipework could not cater for additional pits as well as the roof and stormwater drainage.34 [78] Before Mr O’Regan gave evidence it had been established that these conclusions were based on incorrect information. The evidence is that the Cristianos installed four additional gully pits, three of which connect from behind the house to the pipe to the right-hand side of the house, and one to the left adjacent to the house. The evidence is that but for four additional gullies which fed into the Clarendon stormwater system, the other gullies installed by the Cristianos expelled water through another system to the left of the driveway – this included the roof water off the shed. [79] Mr O’Regan’s conclusion was based on the assumption that the “shed downpipes are connected to the Clarendon Homes installed stormwater”. The evidence at the hearing 34 T2-58, lines 27-28. -- 14 of 20 -- 15 demonstrated that that is not the case. Mr O’Regan was asked if this affected his conclusions regarding overland flow. He responded: “No. Nothing will affect our conclusions about overland flow.” It would however reduce the estimated volume of water entering the Clarendon stormwater system. Increased imperviousness [80] The Table 5.3 is headed Site Imperviousness and calculates the impervious area to be 21.32% greater than the site at practical completion.35 This, Mr O’Regan explained, means that water does not get stored in the ground or slowed.36 [81] Mr O’Regan in evidence accepted that if the water from the shed and the driveway “had its own separate (stormwater) system… it should not impact upon the house drainage”. Overland flow however is a different issue. In the context of the impact of a separate stormwater system installed by the Cristianos for the shed and the driveway, Mr O’Regan accepted that if the stormwater from the shed and driveway was redirected from the residence it would have a lesser impact than stated in his report. Overland flow [82] In evidence Mr O’Regan explained his conclusions that at the time of practical completion there existed an overland flow path (the measurement of the width of the of the overland flow path) on the northern and southern side of the residence,37 measuring a minimum of 5.8 metres and 7.9 metres, respectively.38 He states that currently, the overland flow paths are 1.5 metres and 5.8 metres respectively. He said it had been “minimised by either landscape construction, pool construction, path construction, driveways, etcetera” and that the driveways are not properly shaped “because it’s falling back to the residence”. [83] His report stated that the location of the shed and swimming pool retaining walls are such that they are effectively funnelling the majority of the upstream catchment and concentrating flows towards the residence. Reference was made to a MORA Consulting overland flow contour plan to demonstrate, by reference to the measurement “1494 minimum width of overland flow path” to say that “if the pool wasn’t there, the water would have the whole width to deal with …”.39 The width 1494 is rounded up to 1500 or 1.5 metres (down from 5.8 metres). That concerns the right-hand side of the property. On the left-hand side is the measurement “5849 minimum width of overland flow path” which indicates the available width down the left hand side of the property, down from 7.9 metres. [84] Mr O’Regan says the contours demonstrate that at the top of the property (towards Tamborine-Oxenford Road) the contours are quite evenly spaced such that water falls evenly across that area, but “as the water flows down – down and it heads to the back of the shed where there’s been a retaining wall constructed, it no longer falls evenly across the flow. It’s directed to areas either side of those retaining wall.”40 Conclusions – who is responsible for the defective building work? 35 T2-48, lines 10-11. 36 T2-48, line 18. 37 T2-47, lines 6 to 22. 38 Hearing Book, 801. 39 Hearing Book, 802. 40 T2-50, lines 41-46; T2-51, line 1. -- 15 of 20 -- 16 [85] I accept and agree with the findings in the 1st Theslow report of the following defects to the stormwater system: (a) Three punctures through the top of the pipe were noted on the left side of the house, in the garden bed near the entry to the house. (b) The main pipe reduces in size near the kerb from 100mm to 90mm pipe with a small amount of tree roots evident in the pipe. (c) The pipe is crushed on the left side outlet, at the kerb adaptor. (d) A joint in the pipe is split and is leaching ground water into the pipe at the front of the house near the front right corner. (e) The pipe is holding water for a large percentage of the stormwater service, to varying depths, up to full pipe depth in some locations, noticeably the front left corner of the house. (f) A junction for the downpipe on the rear right corner of the house, near the pool has a large amount of staining or mould in the junction, consistent with a leak on the branch line. Further investigation by removing this downpipe is required to determine the cause. [86] I accept that the stormwater system was built by Clarendon as a closed system; that it would not be usual practice to install a closed system where there is sufficient “fall”; that there is sufficient fall at the subject site; and, that it be a closed system was unintended. [87] Mr Noble in his 2nd report says that “… it is indisputable that the stormwater system holds water and does not have sufficient fall over the entire length of the drainage line to convey via gravity to the legal point of discharge”. However he goes on to say that “… this is not the overarching causation of the applicant’s complaint. It is reasonable to conclude that the applicant has unwittingly created surface drainage issues through other works completed to the property”. [88] The Cristianos are not denying that the additional works they undertook on the property had an impact on the stormwater system (additional gully traps) and that the land contouring had consequences for overland flow which directed (some) stormwater towards the residence. [89] Their issue was that the system holds water because it was not laid correctly, and it would hold water whether the additional works were undertaken by the Cristianos or not. The question is who is responsible for the water that is escaping the stormwater system from the compression breaks and punctures. The Cristiano’s argument is that the two things are connected, that is, because the pipework was improperly laid (as evidenced by the closed system) it was vulnerable to damage including compression fractures and punctures. If it was laid correctly the pipework would have been able to withstand all the forces applied during construction, including the traversing of the area by Clarendon during construction and by the Cristianos in the post-construction period. [90] I accept that the additional works (land contouring, hard structures etc) have added, perhaps significantly to the volume of water that is not draining from the site, particularly around the house. I accept that more water is being fed into the stormwater system from the additional gully traps. I also accept that some of the water which is -- 16 of 20 -- 17 not draining from the system is escaping or leaching into areas adjacent to the identified punctures and split joints causing some soakage. [91] It was not intended that the stormwater system be a closed system. It came as a surprise to Mr Farmer that that was the case when he gave his evidence. The reason it operates as a closed system would seem to be either due to: trenching prior to laying the pipes was not at a gradient that would ensure flow in the direction of the kerb; and/or the aggregate was not placed in the trench in a way so as to avoid “sinking”, or placed in a way to cause the pipes to rise as they progress in the direction towards the kerb; and/or that forces strong enough to displace the pipework (most likely heavy machinery) from its resting place on aggregate were applied causing sinking, puncturing and fracturing of the pipework. [92] A charged or closed system is not contrary to the Australian Standards. However, it was Mr Cristiano’s evidence that for a charged system to be effective it must be a closed system, that is a sealed system. But here the gully pits prevent it working as a closed system because the pressure required to push water out is defused by the gully pits which will result in backflow. This it would appear would be exacerbated by the fact that the pipes reduce in size from 100 mm to 90 mm near the kerb – which during heavy outflows would cause water to back up. Mr Cristiano is a plumber. Although his evidence was not given as expert evidence, I accept his observations on the basis that they were not challenged. [93] There was no evidence from any person who was on site during the trenching or laying of the pipework. There was no inspection of the trenches themselves. The Clarendon evidence is therefore based on the company’s practice and experience. [94] In evidence Mr Cristiano said that he obtained possession of the property and started his works on the building site area approximately nine months after the trenches had been backfilled.41 In his view settlement of these trenches would have already been achieved. He said that he had requested but had received no advice as to whether any backfill material had been used around the pipes, under the pipes, whether they were installed with a pipe laser, whether they were installed with a gradient level, or whether they were installed with just a bubble level. There was no evidence at the hearing regarding these matters. [95] In oral submissions Mr Watt for Clarendon said that based on the evidence of Mr Theslow, it was accepted that there is a counter-gradient on the pipes.42 He said: “How that contributes to the overall problem though is not necessarily known because it is tied into the overland flow issue. So the issue for your Honour is, is it backflow, is it overland flow, or is it both, that contribute to the problems that are being experienced. I would offer that it’s potentially both.” [96] Mr Watt continued: “He’s (Mr Cristiano) dug a – a pipe in close proximity to the pipe of Clarendon. Mr Noble identified that there were puncture marks around that particular area. I’m not suggesting that Mr Cristiano is responsible for that particular damage. But it cannot be ruled out, and that is the point.” [97] Again, in oral submissions concerning the activities on the site: “Clarendon had trucks moving bricks around, of course they did. Clarendon had bobcats. They potentially 41 T2-63, lines 37-42. 42 T2-68, lines 16-19. -- 17 of 20 -- 18 had other machines on site. Those machines may have caused damage to the site. They also may have to the stormwater. They also may now. That – that’s not known.”43 [98] I consider Mr Watt’s concession to be reasonable. Importantly, Mr Cristiano made an equivalent concession in the oral hearing: “Look, I think it’s a fifty-fifty call. Pipes were installed from day one. My work was done after the house was completed. How can you 100% say that I damaged it and I’ve caused any issues to it?” [99] It is accepted that the pipework reduces in diameter near the kerb. It reduces from 100 mm to 90 mm. In closing submissions QBCC say: “…there is no particular expert – expert who particularly says the fact that it goes from 100 to 90 is incorrect, is causing things to back up or – or whatever. It just happens to be there.” They continue: “The real issue, well, sorry a – an issue with where it goes from 100 to 90 is that it’s crushed with a certain point and that join seems to be poor.” Later it is said in reference to the Australian Standard: “Part of why I said that whether it was 90 mils or 100 mils doesn’t matter so much is that under that nominal method, you could have 90 or 100. You could have either.” [100] I think this ignores the funnelling effect that a reduction in pipe size would seemingly have. I can only assume that the Australian Standard (where it applies) is to be applied over the length of the pipe, not sectionally. It would seem absurd to have a pipe which reduces over its length; or for that matter reduces, expands, reduces…. The pipe is damaged near the kerb. It is difficult to think of a reasonable explanation for a change in pipe diameter at and near the kerb. An explanation proffered is that the original pipe was damaged and repaired by someone. I don’t consider it at all likely that the replacement of a 100 mm pipe with a 90 mm pipe was undertaken by the Cristianos. I consider it likely if anyone other than Clarendon had installed the 90 mm section, the Cristianos would have been made aware. Equally, why would Clarendon install a 90 mm section in an otherwise 100 mm pipe? Conclusions [101] I conclude that building work has been carried out and that the building work is defective as per the findings in the 1st Theslow report. [102] I accept that Clarendon is responsible for laying the pipes incorrectly insofar as they were laid as a charged system where they were not intended nor designed to be. As described at paragraph [92], for a charged system to operate effectively it must also be a closed system. The existence of gully traps does not allow the system to operate that way. This raises the potential for backflow through the gully traps, which is likely exacerbated by the reduction of the dimension of pipes from 100mm to 90mm near the kerb, and also exacerbated by the additional load added to the system by the Cristianos. [103] In my view however, even if the pipes were laid correctly, with fall to the kerb, the additional works undertaken by the Cristianos overloaded the system to the point that it is not fit for purpose. In particular, as explained at paragraph [90], the land contouring and hard structures added to the volume of water not draining from the site. The additional gully traps also feed more water into the stormwater system than the system was designed to handle. 43 T2-68. -- 18 of 20 -- 19 [104] I am unable to conclude on the balance of probabilities that Clarendon was responsible for the punctures through the pipes, the crushing of the pipes, the splitting of the pipes, or staining, mould or leaks in the pipes (see paragraph [85(a), (c)-(f)]. There were concessions by both the Cristianos and Clarendon relevant to this conclusion. [105] In my view there is insufficient evidence to conclude that Clarendon was responsible for the reduction in the size of the main pipe near the kerb from 100mm to 90mm. As much as I do not accept the proffered explanation that the Cristianos may have repaired the original pipe by using a 90mm pipe, I equally do not accept that Clarendon installed an incongruent 90mm section in a 100mm pipe. [106] In the circumstances, I cannot conclude that Clarendon is wholly responsible for the defects in the building work as characterised by the 1 st Theslow report. I find it likely that the actions of both Clarendon and the Cristianos contributed to the defects. The pipework was laid incorrectly, but the punctures, crushing, splitting and holding excess water were likely caused by both parties. Even if the pipework was laid correctly, the stormwater system is not fit for purpose. The Cristiano’s additional work on the property has ‘overloaded’ the system. [107] I do hold significant concerns about the approach taken by the parties to AS3500.3. The Nominal Method is not intended to apply to land with an area over 1000m2. The parties’ agreement to effectively ‘contract out’ of the application of AS3500 is discussed at paragraphs [47] – [53]. This clearly evaded the intent of the standard. While the arrangement between the parties might have achieved a saving in cost and time, the consequences are now apparent and the cost both financial and emotional is significant. [108] I consider that it would be unfair to issue a direction to rectify in circumstances where rectification would not solve the problems that are now evident. Re-laying the pipes with the same dimensions at the appropriate gradient will not, based on the evidence presented, fix the drainage problems that now exist on the property. A major hydrologic solution is needed. What was initially agreed between the parties would now be inadequate. [109] The Cristianos’ application falls within the Tribunal’s review jurisdiction as discussed at paragraphs [6]-[11]. In exercising the Tribunal’s review jurisdiction, my powers are limited to confirming the QBCC’s decision, setting aside the decision and substituting it with my own, or setting aside the decision and returning the matter to the QBCC for reconsideration. I must decide the review in accordance with the QBCC Act and the QCAT Act and I have all the functions of the QBCC for the reviewable decision. In this matter, the functions of the QBCC are set out in s 72 of the QBCC Act. [110] In short, if I accept the Cristianos’ application then I can issue a direction to rectify to Clarendon Homes. If I reject the Cristianos’ application then I can refuse to issue a direction to rectify. I cannot made other types of orders to deal with the resolution of this matter. Noting the numerous reports commissioned by Clarendon to respond to this application, the opportunity is there to draw from that work a system that would manage the stormwater demands of the property. Despite the order I make the parties can always pursue a negotiated outcome. [111] I accept the decision of the internal review officer. I do not order a direction to rectify. -- 19 of 20 -- 20 Order The internal review decision of the Queensland Building and Construction Commission dated 21 February 2024 to not issue a direction to rectify is confirmed. -- 20 of 20 --