Cho v Singh [2024] QCAT 364

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL CITATION: Cho v Singh [2024] QCAT 364 PARTIES: HEE CHEOL CHO (applicant) v HARPREET SINGH (respondent) APPLICATION NO: BDL085-22 MATTER TYPE: Building matters DELIVERED ON: 3 September 2024 HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Member Chapple ORDERS: 1. Mr Singh must pay Mr Cho TEN THOUSAND DOLLARS ($10,000.00) by 4:00pm on 1 October 2024. 2. Mr Singh must pay Mr Cho THREE HUNDRED AND FIFTY-EIGHT DOLLARS ($358.00) by 4:00pm on 1 October 2024. CATCHWORDS: JURISDICTION – DOMESTIC BUILDING DISPUTE – REVIEWABLE DOMESTIC BUILDING WORK – where domestic building work includes associated work, being work associated with the renovation, alteration, extension, improvement or repair of a home – where associated work includes the construction of driveways and fencing PROCEDURE – CIVIL PROCEEDINGS IN STATE TRIBUNAL – ENDING PROCEEDINGS EARLY – where one party unnecessarily disadvantages another party – where respondent repeatedly failed to comply with tribunal directions without reasonable excuse – where discretion of tribunal exercised to make final decision in applicant’s favour CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – THE CONTRACT – LEGALITY – PERFORMANCE OF WORK – where domestic building contract does not comply with Schedule 1B of the Queensland Building and Construction Commission Act 1991 (Qld) – where work performed defective and incomplete – whether breach of contract can be established – whether breach of duty of care can be -- 1 of 9 -- 2 established – whether claim for damages in negligence available CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – DAMAGES – MEASURES OF – where contract entered into for the performance of building work and consideration paid – where builder is unlicensed – where builder performs unlicensed building work – where builder not entitled to consideration for performing building work – where builder must repay consideration paid by owner Queensland Building and Construction Commission Act 1991 (Qld), s 42(1), s 42(3), s 42(4), s 77; Sch 1B s 14(2), s 14(10); Sch 2 Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 48 Bellgrove v Eldridge [1954] HCA 36; (1954) 90 CLR 613 Cook's Construction P/L v SFS 007.298.633 P/L (formerly trading as Stork Food Systems Australasia P/L) [2009] QCA 75 Corporation of the City of Adelaide v Jennings Industries Ltd [1985] HCA 7; (1985) 156 CLR 274 Robinson v Harman [1848] EngR 135; (1848) 1 Ex 850; 154 ER 363 Ventura v Svirac (1961) WAR 63 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) REASONS FOR DECISION [1] Mr Singh contracted with Mr Cho to complete driveway, fencing, landscaping, and concreting work at Mr Cho’s home. Mr Cho made two payments in part payment of the contract amount before the work commenced and in the early stages of the work. Mr Singh failed to complete all the work under the contract. Mr Cho was not satisfied with the standard of the completed work. [2] Mr Cho filed in the Tribunal an application for a domestic building dispute. Mr Singh has not filed a response to the application or otherwise complied with any Tribunal directions. Background Mr Cho’s evidence [3] Mr Cho’s evidence1 is summarised as follows: 1 Statement of Evidence filed 30 June 2022 (and refiled 5 July 2023) and Statement of Evidence filed 23 December 2022. -- 2 of 9 -- 3 (a) On 14 November 2021, Mr Singh emailed to Mr Cho a typed quote2 number 318, dated 14 November 2022 and issued in the name of H&J Landscaping (which appears to be a trading name for Mr Singh). The quote set out in a table the following work to be carried out at Mr Cho’s home at 12 Perring Crescent, Rochedale, Queensland: 50m 2 concrete sides and front: $3,900; 75m 2 premium artificial grass: $4,900; 12m front block wall: $5,900; 12.5m garden bed block wall: $2,500; 12.5m treated timber butted fence: $1,500; totalling $20,570 including GST. On the same date, by reply email, Mr Cho accepted the quote with some additional questions. Subsequently, in the course of discussions and text messages3 between the parties, the quote amount increased to $25,320 to include driveway work Mr Cho requested. Mr Singh reduced the quote amount to $22,500 because of his stated preference that Mr Cho pay him in cash. Handwritten notes and figures and initialling were added to the typed quote as described in the next paragraph. (b) Mr Cho and Mr Singh agreed on the contract work on 4 December 2021. Mr Singh told Mr Cho he could start in the middle of December and the job would take 3 or 4 weeks. (c) At Mr Singh’s request, Mr Cho paid a $5,000 deposit on 11 December 2021. (d) Mr Singh commenced the driveway work on 22 December 2021. (e) After Mr Singh commenced the driveway work, he charged an extra amount to cut the existing concrete. Mr Cho objected but agreed to the extra charge because he wanted the job done as soon as possible. (f) Mr Singh did not complete the driveway work because he did not have the correct equipment to cut the existing concrete. (g) Mr Cho was not satisfied with the standard of the partially completed driveway work and has produced photographs.4 Despite Mr Cho’s requests, Mr Singh did not rectify the problems with the driveway. (h) At Mr Singh’s request, Mr Cho paid a second $5,000 deposit prior to the commencement of the garden and fence work. He was reluctant to do so because he believed that the first $5,000 payment was the deposit for all the quoted work, and he did not expect to make a further payment until all the work was completed. (i) Mr Singh completed the garden and fence work. However, Mr Cho was not satisfied with the standard of the work and has produced photographs.5 (j) Mr Singh delayed commencing the concreting work. Mr Cho questioned whether Mr Singh wanted to do the work and when the work would commence. Mr Singh did not commence the concreting work and after a period told Mr Cho he did not want to complete the rest of the work. (k) At 11 February 2022, Mr Singh had not completed half the contracted work. 2 Statement of Evidence filed 30 June 2022, quote exhibited. 3 Ibid, text messages exhibited. 4 Ibid, photographs exhibited. 5 Ibid, photographs exhibited. -- 3 of 9 -- 4 (l) Mr Cho requested that Mr Singh return the money he had overpaid, stating in a text message that he thought he should get back at least $2,000.6 (m) Mr Singh did not respond to Mr Cho’s request. (n) At some stage, Mr Cho became aware that Mr Singh did not hold a contractor’s licence. [4] On the face of the typed quote, in the white spaces beside and below the typed text, are the following handwritten notes and figures some of which appear to have been initialled. However, it is not apparent who has written on or initialled the document. Excluded are handwritten notes and numbers that have no apparent relevance to the dispute. (a) The numbers 1, 2, 3, 4 and 5 beside (respectively) timber butted fence, garden bed block wall, concrete sides and front, front block wall, and artificial grass. (b) The figures 5900, 2500 and 1500 circled. (c) Immediately below the table: paid deposit from which two lines are drawn to circled numbers 2 and 3. (d) Below the typed total 20570.00: driveway: 4750 extra $600 (e) Further below: Total: $22,500 Paid cash $5000 11 Dec $17500 + 600 Paid cash $5000 on 22/12 $13100 left Mr Cho’s application [5] On 18 March 2022, Mr Cho filed an application for a domestic building dispute. He applied for orders that Mr Singh pay him ‘restitution’ in the amount of $2,500 and ‘rectification or completion of defective and incomplete work’ in the amount of $7,000. [6] Mr Cho attached to his application evidence of compliance with Queensland Building and Construction Commission (‘QBCC’) pre-proceeding dispute resolution processes enlivening the Tribunal’s jurisdiction.7 [7] On 25 March 2022, Mr Cho served a copy of the application on Mr Singh.8 [8] Mr Cho was directed to file a detailed statement of evidence addressing, inter alia, details of the following: the agreement entered into with Mr Singh; the building work carried out; the alleged defective and incomplete building work and cost of rectification and completion; any breach of duty of care by Mr Singh in carrying out 6 Ibid, text message exhibited. 7 Letter from QBCC to Mr Cho dated 8 March 2022. 8 Affidavit of Service dated 25 March 2022 and filed in the Tribunal on 29 March 2022. -- 4 of 9 -- 5 the building work and the cost of rectification; and whether Mr Singh was licensed to carry out the work. 9 [9] On 20 June 2022, Mr Cho filed a statement of evidence (‘SOE1’). [10] Mr Cho was directed again to file a detailed statement of evidence addressing, inter alia, details of the following: the agreement entered into with Mr Singh; the building work carried out; the alleged defective and incomplete building work and cost of rectification and completion; any breach of duty of care by Mr Singh in carrying out the building work and the cost of rectification; and whether Mr Singh was licensed to carry out the work.10 [11] On 23 December 2022, Mr Cho filed a statement of evidence (‘SOE2’). [12] Mr Cho was directed to file a complete copy of text messages attached to SOE2, the evidence relied on to support his assertion that the building work carried out by Mr Singh was defective, and the evidence relied on to support the assertion that the defective work has been rectified, and evidence of the cost incurred, and the defective work still to be rectified and evidence of the cost to be incurred.11 [13] On 5 July 2023, Mr Cho re-filed SOE1. [14] Mr Singh did not file any material in response to various directions made by the Tribunal. [15] The Tribunal directed that the matter be determined on the papers without an oral hearing and on the basis of the documents forming the Tribunal record. 12 Consideration and findings Tribunal’s jurisdiction [16] The relevant enabling Act is the Queensland Building and Construction Commission Act 1991 (Qld) (‘QBCC Act’). [17] The Tribunal has jurisdiction to hear and decide building disputes.13 A building dispute includes a domestic building dispute.14 A domestic building dispute includes a dispute between a building owner and building contractor relating to the performance of reviewable domestic work.15 Both ‘building contractor’ and ‘building owner’ are defined in the QBCC Act.16 Reviewable domestic work means domestic building work under s 4 of Schedule 1B of the QBCC Act. Domestic building work includes associated work, being work associated with the renovation, alteration, extension, improvement or repair of a home,17 and associated work includes landscaping, paving, and the erection or construction of a building or fixture 9 Directions dated 11 April 2022 and 27 June 2022. 10 Direction dated 9 December 2022. 11 Directions dated 16 May 2023 and 23 June 2023. 12 Direction dated 23 June 2023. 13 QBCC Act, s 77. 14 Ibid, Schedule 2 (definition of ‘domestic building dispute’). 15 Ibid, (definition of ‘reviewable domestic work’). 16 Ibid, (definition of ‘building contractor’; definition of ‘building owner’). 17 Ibid, Schedule 1B, s 4(3). -- 5 of 9 -- 6 associated with the detached dwelling or home.18 Associated work includes the construction of driveways and fencing.19 [18] A person involved in a building dispute may apply to the Tribunal to decide the dispute provided the person has complied with a process established by the QBCC to attempt to resolve the dispute.20 [19] I am satisfied and find that: (a) Mr Cho is a building owner and Mr Singh is a building contractor. (b) The work Mr Singh contracted to carry out, and in part carried out, was domestic building work. (c) The dispute between the parties is a domestic building dispute. (d) Mr Cho complied with the QBCC pre-proceeding dispute resolution processes. (e) The Tribunal has jurisdiction to hear and decide the dispute. Bringing proceeding to an early end [20] A proceeding in the Tribunal may be brought to an early end in circumstances where the Tribunal considers a respondent in the proceeding is acting in a way that unnecessarily disadvantages an applicant by not complying with a Tribunal order or direction without reasonable excuse. In such circumstances, the Tribunal may make its final decision in the proceeding in the applicant’s favour.21 [21] I am satisfied and find that: (a) Service of the application for a domestic building dispute has been properly effected upon Mr Singh.22 (b) Mr Singh has failed to comply with directions23 to file a response to the application. (c) Mr Singh has failed to comply with the direction24 to file any statements of evidence. (d) Mr Singh has failed to engage in this proceeding in any manner. (e) Mr Singh has paid no monies to Mr Cho in respect of the amounts claimed.25 (f) In failing to comply with any Tribunal directions or to engage in this proceeding in any manner without reasonable excuse, Mr Singh has unnecessarily disadvantaged, and continues to unnecessarily disadvantage, Mr Cho. The disadvantage to Mr Cho is that he has been unable to progress his claim to final resolution. 18 Ibid, Schedule 1B, s 4(4). 19 Ibid, Schedule 1B, see examples at s 4(4). 20 Ibid, s 77(2). 21 Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 48. 22 Affidavit of Service filed 29 March 2022. 23 Directions dated 11 April 2022 and 27 June 2022. 24 Direction dated 27 June 2022. 25 Applicant’s statement of evidence filed 30 June 2022 and 5 July 2023. -- 6 of 9 -- 7 [22] I have considered the matters at s 48(3) of the Queensland Civil and Administrative Tribunal Act 2009 (Qld). Whether and to what extent Mr Singh is familiar with the Tribunal’s practices and procedures, and Mr Singh’s capacity to comply with Tribunal directions are matters I am unable to form a view about given Mr Singh’s lack of engagement in the proceeding. Mr Singh’s failure to comply with directions appears, in the absence of an explanation to the contrary, to be a deliberate act. [23] I am satisfied that it is appropriate to exercise my discretion and make a final decision in the proceeding in favour of Mr Cho. [24] In deciding a building dispute, the Tribunal may order the payment of an amount found to be owing by one party to another.26 Contract and breach [25] Mr Cho says that Mr Singh partially completed the contracted work, and the standard of the completed work was unsatisfactory and defective. Mr Cho broadly claims ‘restitution’ in the amount of $2,500 and ‘rectification or completion of defective and incomplete work’ in the amount of $7,000. [26] Ordinarily the failure by a building contractor to complete works without reasonable excuse and/or the performance of defective work by a building contractor is a substantial breach of contract, constituting repudiatory conduct, and giving rise to an entitlement by the building owner to terminate the contract. In such event, the building owner is entitled to claim damages for the builder’s breach. Where a building owner sustains a loss by reason of a breach of contract by a builder, the building owner is, as far as money can do it, entitled to be placed in the same situation, with respect to damages, as if the contract had been performed.27 The measure of damages recoverable by a building owner for breach of a building contract is the difference between the contract price for the work and the cost of making the work conform to the contract, subject to undertaking the work necessary to achieve conformity being a reasonable course to adopt.28 In assessing the building owner’s damages, the builder must be given credit for any unpaid part of the contract sum.29 [27] The QBCC Act provides that a domestic building contract for an amount equal to or more than $20,000 is a level 2 regulated contract.30 A level 2 regulated contract, inter alia, must be in writing, dated and signed by or on behalf of each of the parties, and only has effect if these requirements are complied with.31 [28] Mr Singh provided to Mr Cho a typed quote amended by handwritten notes and figures, marked by unidentifiable initialling, and accompanied by associated email and text messages. 26 Ibid, s 77(3). 27 Robinson v Harman (1848) 1 Ex 850; 154 ER 363. 28 Bellgrove v Eldridge (1954) 90 CLR 613. 29 Ventura v Svirac (1961) WAR 63 cited with approval in Corporation of the City of Adelaide v Jennings Industries Ltd (1985) 156 CLR 613. 30 QBCC Act, Schedule 1B, ss 1 (definition of ‘regulated amount’), 7(1)(a), 7(2); Queensland Building and Construction Commission Regulation 2018 (Qld), s 45. 31 QBCC Act, Schedule 1B, s 14(2) and s 14(10). -- 7 of 9 -- 8 [29] I am not satisfied the quote as described complies with the requirements for a level 2 regulated contract. A contract that has no effect is void and cannot be enforced. Mr Cho cannot rely on the quote as described to make a claim against Mr Singh. Negligence and breach of duty [30] A domestic building dispute may include a claim or dispute in negligence relating to the performance of reviewable domestic work.32 A building owner, in order to establish negligence by a builder, must prove that: the builder owed to the owner a duty of care; the builder breached the duty; and as a result of the breach of duty, the owner has suffered loss. [31] Generally speaking, a builder owes to an owner a duty to perform building works with reasonable care and skill, and therefore a builder may be liable to an owner for any negligence arising from defective work.33 [32] Mr Cho’s SOE1 and SOE2 do not address the matters he was directed by the Tribunal to particularise and provide supporting evidence for. Mr Cho refers only generally in his material to ‘problems’ with the completed work and a ‘very bad quality job’, and no explanations accompany the photographs provided. [33] I find that Mr Cho has failed in his material to adequately particularise or provide evidence of the following: the building work carried out; the alleged defective and incomplete building work; the cost of rectification and completion, incurred or to be incurred; any breach of duty of care by Mr Singh in carrying out the building work and the cost of rectification. [34] I am not satisfied that Mr Cho has established a breach of duty by Mr Singh. Unlicensed building work [35] A person must not carry out, or undertake to carry out, building work unless the person holds a contractor’s licence of the appropriate class.34 A person who carries out unlicensed building work is not entitled to any monetary or other consideration for doing so.35 Any monetary or other consideration paid to an unlicensed builder must be repaid.36 [36] An unlicensed builder may claim reasonable remuneration for carrying out building work. However, it is limited to an amount that complies with the statutory requirements.37 [37] It is clear from the provisions of the QBCC Act that the prohibition on unlicensed building work is in respect of an unlicensed contractor agreeing to carry out building works, carrying out building works, receiving payment for carrying out building works, and retaining any payment for carrying out building works. 32 Ibid, Schedule 2 (definition of ‘domestic building dispute’). 33 See Bryan v Maloney (1995) 182 CLR 609, 11. 34 QBCC Act, s 42(1). 35 Ibid, s 42(3). 36 Cook’s Construction P/L v SFS 007.298.633 P/L (formerly trading as Stork Food Systems Australasia P/L) [2009] QCA 75 (3 April 2009). 37 QBCC Act, s 42(4)(a)-(d). -- 8 of 9 -- 9 [38] I am satisfied and find that: (a) Mr Cho paid Mr Singh two (2) cash amounts of $5,000 on 11 and 22 December 2021 respectively. (b) At the time Mr Cho entered into the contract with Mr Singh, at the time Mr Singh carried out the building work, and at the time Mr Cho paid Mr Singh, Mr Singh was not a licensed contractor.38 (c) Mr Singh was in breach of s 42(1) of the QBCC Act when he carried out building work for Mr Cho and received payments from Mr Cho totalling $10,000. (d) Mr Singh was not permitted to carry out the building work nor was he entitled to any monetary consideration for so doing. (e) Pursuant to s 42(3) of the QBCC Act, Mr Singh was not entitled to the payments totalling $10,000 that he received from Mr Cho, and he has no entitlement to retain that money. [39] There is no application before the Tribunal by Mr Singh pursuant to s 42(4) of the QBCC Act claiming reasonable remuneration. [40] I find that Mr Singh must repay to Mr Cho the amount of $10,000. Costs [41] Mr Cho has not sought costs in his application. [42] The Tribunal has the power to award costs in building disputes.39 The discretion to award costs is a broad one which must be exercised judicially, not upon irrelevant or extraneous considerations but upon facts connected with or leading up to the proceeding.40 [43] The Tribunal may on its own initiative make an order against the party causing the disadvantage to compensate the other party for any reasonable costs incurred unnecessarily.41 [44] Mr Cho outlaid $358.00 for the QCAT application filing fee. [45] I find Mr Cho is entitled to recover the filing fee on the application. This cost was reasonable and necessary to enable Mr Cho to pursue his legal entitlements. I fix the total costs payable by Mr Singh in the amount of $358.00. 38 QBCC licence search conducted by the Tribunal on 27 August 2024. The search also recorded the issue of an infringement notice for unlicensed contracting in respect of an offence dated 14 November 2021. 39 QBCC Act, s 77(3)(h). 40 Lyons v Dreamstarter Pty Ltd [2012] QCATA 497 Justice Alan Wilson. 41 Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 48(2)(c). -- 9 of 9 --