Commissioner of State Revenue v Taske [2023] QCATA 121

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL CITATION: Commissioner of State Revenue v Taske [2023] QCATA 121 PARTIES: COMMISSIONER OF STATE REVENUE (Applicant) v NICOLA JOY TASKE (Respondent) APPLICATION NO/S: APL019-23 MATTER TYPE: Appeals DELIVERED ON: 29 September 2023 HEARING DATE: 21 July 2023 HEARD AT: Brisbane DECISION OF: Judicial Member Forrest SC ORDERS: 1. The appeal is allowed. 2. The decision of the Tribunal of 21 December 2022 is set aside. 3. The decision of the Commissioner of State Revenue of 29 November 2021 is confirmed. 4. Each party shall bear their own costs of and incidental to this appeal. CATCHWORDS: ADMINISTRATIVE LAW – ADMINISTRATIVE TRIBUNALS – QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL – HOMEBUILDER GRANT – where the Respondent applied for the HomeBuilder grant – where the Respondent entered into a building contract as well as a separate contract with a tiler – where the building contract excluded the tiling work – where the Applicant determined the Respondent was not eligible for the grant – where the Tribunal at first instance set aside the decision – where the Applicant appeals on questions of law – whether the two contracts formed a comprehensive home building contract as required by the grant scheme – whether the scheme and relevant statutes made the builder “responsible” for the tiling work Building Act 1975 (Qld), s 10, s 98, s 99 Building Regulation 2006 (Qld), s 24, s 26 First Home Owner Grant and Other Home Owner Grants Act 2000 (Qld), s 25Q, Sch Dictionary -- 1 of 8 -- 2 Queensland Building and Construction Commission Act 1991 (Qld), Sch 1B, s 1, s 17, s 20(1), s 21, s 22, s 23(2), s 24 Queensland Building and Construction Commission Regulation 2003 (Qld) APPEARANCES & REPRESENTATION: Applicant: G Hartridge, counsel instructed by the Commissioner of State Revenue Respondent: Self-represented (by telephone) REASONS FOR DECISION [1] The Respondent and her husband applied to receive the $25,000 “HomeBuilder” grant. The HomeBuilder grant scheme was introduced by the Commonwealth Government during the COVID epidemic as a measure to save the housing construction sector during that difficult time. Pursuant to agreement between the Commonwealth Government and the State and Territory Governments, the State and Territory Governments administer the grant scheme on behalf of the Commonwealth. In Queensland, that grant scheme is administered by the Applicant, a Queensland statutory body. It is administered under the First Home Owner Grant and Other Home Owner Grants Act 2000 (Qld) (the FHOG Act) and the statutory instrument known as the Administrative direction — Australian Government HomeBuilder grant — Queensland (the Direction). [2] Unfortunately for the Respondent and her husband, the Applicant determined that the Respondent and her husband were not eligible for the grant and refused their application. This determination was based on interpretation of the FHOG Act and the Direction with which compliance is required under section 25Q of that Act. [3] The Respondent objected to that decision. The Applicant’s internal review process upheld the original refusal decision. The Respondent applied to the Queensland Civil and Administrative Tribunal for review of the refusal. [4] The Tribunal, at first instance, set aside the decision being reviewed and determined the Respondent eligible for the grant. The Applicant appeals against that decision to this Appeals Tribunal. The issue to be determined in this appeal is whether the Tribunal below correctly interpreted the FHOG Act and the Direction. The Applicant contends that it did not. [5] As this involves determining questions of law, leave to appeal is not required and the appeal is as of right pursuant to s 142 of the Queensland Civil and Administrative Tribunal Act 2009 (the QCAT Act). [6] With respect to the Tribunal Member at first instance, for the reasons I now set out herein, I accept the Applicant’s submissions and find the Respondent and her husband ineligible for the grant on a correct interpretation of the legislation and applicable legislative instrument. -- 2 of 8 -- 3 FACTUAL BACKGROUND [7] On 12 November 2020, the Respondent and her husband entered into a building contract with a builder for the construction of a new home in a Townsville suburb. The contract price was $227,900 inclusive of GST. However, in addition to the contract with the builder, the Respondent and her husband entered into a separate and distinct contract with a tiler to undertake waterproofing and tiling of the wet areas in the house. The contract price for this work was $9,528.40 inclusive of GST and was, of course, additional to and not included in the contract price of the build. Furthermore, the Respondent and her husband provided, at their own cost, various plumbing items to be installed, presumably by the tiler. Though the waterproofing and tiling was, of course, carried out during the build of the house, the work was specifically excluded from the contract with the builder through Schedule 3 of the building contract and the tiler was not sub-contracted to the builder. [8] There was a very simple reason for the separate tiling contract with a different trade service provider. The Respondent and her husband wanted particular tiles for the wet areas in their new house, but the builder could not supply those particular ones. The builder was clearly happy enough for a separate contract to be entered into with the tiler for the waterproofing of the wet areas and the supply and fixing of the tiles. [9] The building contract was entered into between 4 June 2020 and 31 March 2021. As such, it was within the period for which the Commonwealth’s HomeBuilder grant applied to eligible transactions. [10] Relevantly, section 25Q of the FHOG Act says the following:- (1) A person who is eligible to apply for a home builder grant under the home builder direction may apply for the grant. (2) An application for a home builder grant must comply with the home builder direction. (3) An applicant for a home builder grant is entitled to be paid the grant if— (a) the applicant or, for a joint application, each of the applicants, complies with the eligibility criteria for the grant under the home builder direction; and (b) the transaction for which the grant is sought is an eligible home builder transaction; and (c) the relevant requirement in relation to the eligible home builder transaction has been met. … (5) In this section— relevant requirement, in relation to an eligible home builder transaction, means— (a) if the transaction is a contract for the purchase of a new home within the meaning of the home builder direction—the contract has been completed within the meaning of the home builder direction; or (b) if the transaction is a comprehensive home building contract within the meaning of the home builder direction—the -- 3 of 8 -- 4 foundations have been laid and the first progress payment has been paid to the builder under the contract; or (c) if the transaction is a contract for a substantial renovation within the meaning of the home builder direction—construction under the contract has commenced and at least $150,000 of the contract price has been paid to the builder under the contract. (my bold added) [11] The Direction for the scheme issued jointly by the State Government and the Australian Government was approved in Queensland in July 2020 by the Queensland Treasurer. Relevantly, that Direction made a comprehensive home building contract made by the freehold owner of land in Queensland, to have a new home built on the land, an eligible transaction in certain date determined circumstances. In this case, as I have already observed, there is no dispute about eligibility relating to the dates. [12] Also, relevantly, that Direction made a comprehensive home building contract not an eligible transaction if the total of (a) the consideration for the transaction (i.e. the contract for the build) and (b) the unencumbered value of the land on which the new home is built, is more than $750,000. There is no dispute about eligibility on this ground in this case either. (my emphasis added) [13] Eligibility in this case all turns on the correct interpretation of the words “a comprehensive home building contract.” That phrase is defined in both the FHOG Act (in the Dictionary contained in the Schedule) and in the Direction (clause 14) in the same way. It is:- A comprehensive home building contract means a contract under which a builder undertakes to build a home from the start of building work to the point where the home is ready for occupation and, if for any reason, the work to be carried out under the contract is not completed, includes any further contract under which the work is to be completed. (my emphasis added) [14] The Respondent and her husband conceded that they entered into two contracts to build their new home to completion, but they submitted that these two contracts formed a comprehensive home building contract as that term is defined for the scheme. [15] The Applicant submitted that there was not a comprehensive home building contract because for a dwelling to be ready for occupation, water proofing and tiling to the wet areas must be completed and that in this case the builder has not taken contractual responsibility for the completion of all of these works under the building contract. Accordingly, it was submitted, the builder had not undertaken to “build a home from the start of building work to the point where the home is ready for occupation” as is required for a comprehensive home building contract. It was submitted as the owners had contracted with a third party to do some of the work, the owners did not have “a comprehensive home building contract” for the build of their house, such as is required to be eligible for the grant. The Decision Below [16] The learned Tribunal Member rejected the Respondent’s argument that the two contracts should be considered together as one to satisfy the definition. He pointed out, correctly in my view, that the definition specifies that it is the “builder”, in the singular, who must undertake to build the house from start to finish under a contract. The words -- 4 of 8 -- 5 of the definition, he said, contemplate a single contract to build from start to finish, by a single builder. Respectfully, I consider that to be plainly correct. [17] Furthermore, the learned Tribunal Member also dealt with the fact that the definition of a comprehensive home building contract refers to further contracts for non- completed work. However, that reference to further work is, he said, referring to work under the primary contract that could not be completed for “any reason” such as the builder’s bankruptcy, liquidation, loss of licence or some other default. It quite simply catches, I am satisfied, the circumstance where another builder is then required to complete the build and is not intended to catch a situation where there is an agreed exclusion of part of the works between the owner and the builder in the building contract with such other work to be undertaken by another builder or even other builders or contractors. [18] Having found that way though, the learned Tribunal Member went on to find that the contract the owners had with the builder nevertheless still satisfied the definition of “a comprehensive home building contract.” He appears to have done this by finding that despite the fact that another contractor was engaged to do some of the work, the builder was ultimately “responsible” for handing over a home that could be occupied by the Respondent and her husband at the end of the day. He reasoned that the definition of “a comprehensive home building contract” does not say “that the builder must undertake every critical part of the building work” so that what the builder produces meets the definition of “home” set out in the Direction.1 [19] The learned Tribunal Member found that the:- builder has oversight and responsibility for the work to ensure the external contractor complies with all necessary regulatory processes. He also found that:- insofar as the regulatory requirements are concerned, the builder took responsibility. Although the builder may not be contractually responsible it is responsible under the Queensland Building and Construction Commission Act 1991 (Qld). Having found that:- the builder had ensured the home was ready for occupation By issuing the final certificate, he went on to find that:- contractually, it is the builder who hands the house over at the point it is ready for occupation. [20] The learned Tribunal Member found that in these circumstances, the Applicant’s interpretation of the definition of “a comprehensive home building contract” in the Direction is “too restrictive and defeats the purpose of the Direction as a legislative instrument.” This led to his determination that the contract with the builder in this case satisfied the definition. 1 The Direction’s definition of “home” is “a building, fixed to land, that (a) may lawfully be used as a place of residence; and (b) is a suitable building for use as a place of residence.” -- 5 of 8 -- 6 My Determination [21] As the Applicant submits, I accept that it is the terms of the FHOG Act and the Direction which are the sole source of the eligibility requirements which were to be applied by the Applicant and nothing else. Indeed, curiously given his ultimate finding, the learned Tribunal Member said in his reasons that “there is no ambiguity in the terminology of the definition”:-2 Importantly, in my respectful view, there is nothing ambiguous about the meaning of the words “from the start of building work to the point where the home is ready for occupation.” I accept the Applicant’s submission that these words in this context mean that all of the works necessary to result in a home being ready for occupation must be undertaken by the builder under the contract. (my emphasis added) [22] As is also submitted by the Applicant, this meaning is consistent with the use of the word “comprehensive” being the descriptor for the type of contract that meets eligibility. [23] As the Applicant points out in written submissions, in other grant schemes such as the first home owner grant scheme, the definition of “owner builder” is defined to mean “an owner of land who builds a home, or has a home built on the land without entering into a comprehensive home building contract.” I am satisfied that definition would have clearly caught and included the Respondent and her husband in this case if it had been included in s 25Q of the FOHG Act. The fact that it was not included in eligibility for the HomeBuilder grant is, in my view, plainly demonstrative of the intent surrounding eligibility for this grant. This was not considered by the learned Tribunal Member below on the face of his reasons. [24] Another fact, similarly demonstrative of this point surrounding intention, is the limitation of eligibility to transactions that are comprehensive home building contracts to those where the consideration for the transaction plus the unencumbered value of the land is not more than $750,000. As the Applicant submits, and I accept, this requirement is consistent with a reading of the definition of comprehensive home building contract that requires all of the works for the building of the home to completion to be under that one contract. If it was otherwise, the $750,000 cap that is prescribed in the Direction would easily be rendered ineffective by owners simply having various works performed outside of the contract and thereby not considered to be subject to the monetary limit. That clearly is not what was intended. [25] The learned Tribunal Member has erred, in my respectful view, when he found that the builder being “responsible” for the work of the other contractor, under the Queensland Building and Construction Commission Act 1991 (Qld) (the QBCC Act), was enough to bring the construction of the home within the one contract it had with the owner such as to satisfy the meaning of “a comprehensive home building contract.” The definition uses the words “a contract under which a builder undertakes to build a home from the start of the building work to the point where the home is ready for occupation.” The words are not “undertakes or otherwise has responsibility for the construction of a home.” (my emphasis added) [26] Further, as was correctly submitted for the Applicant, the learned Tribunal Member did not expressly cite or clarify the specific source of the “responsibility” that he found 2 Paragraph [29]. -- 6 of 8 -- 7 existed under the QBCC Act. The Applicant’s written submissions carefully detailed and considered relevant provisions of the QBCC Act and Regulations, the Building Act 1975 and the Building Regulation 2006. Do the QBCC Act and the Building Act 1975 and the Building Regulation 2006 make a builder “responsible” for works excluded from a building contract? [27] Domestic building contracts are regulated under schedule 1B of the QBCC Act.3 As is pointed out by the Applicant, schedule 1B classifies contracts into levels and provides that the contracts must contain specified provisions.4 There is no reference to particular work that is excluded from a contract and there is no provision that makes a builder “responsible” for work excluded from the contract. Certain warranties are statutorily implied under Part 3 of Schedule 1B but they only cover the “subject work”5 and that is defined by reference to work being carried out or managed “under the contract”,6 so it does not include works excluded under the contract. [28] Paragraph 24 of Schedule 1B of the QBCC Act does provide for another statutory warranty “if the subject work” consists of the construction of a detached dwelling “to a stage suitable for occupation”. The builder, in such circumstances, warrants the home will be suitable for occupation when the work is finished. As the Applicant submits, and I respectfully accept, that is limited only to the work to be carried out under the contract, and only applies “if” the subject work consists of all construction to a stage suitable for occupation. As there are works excluded from this contract that must be performed before occupation of the home is lawful, this particular statutory warranty would not apply or could only be relied upon by the owners to the extent that works were to be carried out by the builder under the contract. [29] Similarly, as the Applicant pointed out, the terms and conditions of the policy established in Queensland under the housing construction industry insurance scheme approved through the Queensland Building and Construction Commission Regulation 2003 also limit cover to the work included in the scope of the contract. The builder is therefore not going to be responsible for any problem with the work undertaken by the tiling contractor. [30] As for the issue of certification forms, under sections of the Building Act 1975 and the Building Regulation 2006,7 the obligations and responsibility for issuing these are on the building certifier, not the builder. Accordingly, there is no additional responsibility placed on the builder in this respect. Though paragraph 17 of Schedule 1B of the QBCC Act imposes an obligation on a builder where the contract makes them responsible for engaging a building certifier for “the subject work” under a regulated contract to give the building owner a copy of the certificate, it still does not impose an obligation or responsibility on the builder to obtain certificates from external contractors for work done that was excluded from the scope of the “subject work”. The actual obligation to provide a copy of the certificate of final inspection and copies of 3 Section 67AZN of the QBCC Act. 4 Paragraphs 13 and 14 of Schedule 1B. 5 Paragraphs 20(1), 21, 22, 23(2) of Schedule 1B. 6 Paragraph 1 of Schedule 1B. 7 Sections 10, 98 and 99 of the Building Act 1975 and sections 24 and 26 of the Building Regulation 2006. -- 7 of 8 -- 8 any other inspection documentation (such as for work done by an external contractor) to the owner is on the certifier.8 Conclusion [31] Being so satisfied, I respectfully find that the learned Tribunal Member erred in law by finding that “responsibility”, assumed or falling upon the builder, made the builder’s contract with the owners “a comprehensive home building contract” within the definition of the Direction. [32] I am satisfied that the pre-requisites for “a comprehensive home building contract” were not met in the contract between the Respondent and her husband and the builder or otherwise. There is no eligible transaction and the grant is not payable to the Respondent and her husband. [33] As was clearly and respectfully acknowledged by the Applicant, neither the Respondent nor her husband have done anything wrong or inappropriate in applying for the grant. In the circumstances outlined by them, their doing so can be understood. The decision about their ineligibility is one simply based on interpretation of the legislation and legislative instruments that applied in discerning the intent behind those provisions. If that intent as to eligibility has not been conveyed appropriately to the public then that is perhaps attributable to a failure in communication on the part of Government that might need to be considered in respect of any such future schemes. [34] Pursuant to section 146 of the QCAT Act, this Appeal Tribunal can set aside the decision of the Tribunal below and substitute its own decision. It is plainly the appropriate course so as to avoid further delay and costs for the parties. [35] Accordingly, I make the Orders set out at the commencement of these written reasons. 8 Section 99 of the Building Act 1975. -- 8 of 8 --