Bace Investments Pty Ltd t/as Stroud Homes Brisbane North v Queensland Building Construction Commission [2022] QCAT 170

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL CITATION: Bace Investments Pty Ltd t/as Stroud Homes Brisbane North v Queensland Building Construction Commission [2022] QCAT 170 PARTIES: BACE INVESTMENTS PTY LTD TRADING AS STROUD HOMES BIRSBANE NORTH (applicant) V QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION (respondent) APPLICATION NO/S: GAR316-18 and GAR319-18 MATTER TYPE: General administrative review matters DELIVERED ON: 28 April 2022 HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Member Cranwell ORDERS: The direction to rectify in respect of the driveway is confirmed. The direction to rectify in respect of the onsite dispersion system is set aside, and a new decision is substituted not to issue a direction to rectify in respect of the onsite dispersion system. CATCHWORDS: PROFESSIONS AND TRADES – BUILDERS – STATUTORY POWER TO REQUIRE RECTIFICATION OF DEFECTIVE OR INCOMPLETE BUILDING WORK – where decision made to issue a direction to rectify to the builder – where the builder filed an application to review the decision – whether items of work are defective work – whether fair to give a direction to rectify Queensland Building and Construction Commission Act 1991 (Qld), s 72, s 86C Queensland Building and Construction Regulation 1998 (Qld), Schedule 1 Jarvis v Queensland Building and Construction Commission [2014] QCAT 693 Morley v Queensland Building and Construction Commission [2017] QDC 95 -- 1 of 8 -- 2 APPEARANCES & REPRESENTATION: Applicant: Self-represented Respondent: K Joyce 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] Bace Investments Pty Ltd trading as Stroud Homes Brisbane North (‘Bace’) entered into a contract for the construction of a new residential dwelling on property owned by David Simmonds, Julie Simmonds and Marie Jarick (‘owners’) on or about 30 March 2016. [2] Construction on the dwelling commenced on or about 15 November 2016, and was completed on 22 May 2017. [3] The owners lodged a complaint with the QBCC on 24 March 2018, which is the complaint to which these proceedings relate. The subsequent complaint made on 16 December 2018 is not the subject of these proceedings. [4] The decision under review is a decision made by the Queensland Building and Construction Commission (‘QBCC’) on 26 October 2018. This was a deemed decision under s 86C(3) of the Queensland Building and Construction Commission Act 1991 (Qld), which is taken to be the same as the original decision made on 18 July 2018. The original decision required Bace to rectify the what the QBCC considered to be defective building works as follows: (a) the concrete driveway has worn prematurely resulting in the exposure of aggregate and causing an unsatisfactory appearance; and (b) the onsite dispersion system is significantly undersized to accommodate the volume of stormwater conveyed by the roof drainage system, resulting in excessive stormwater overflowing from the gutter during normal showers and is not fit for purpose. [5] Bace seeks to have both directions to rectify set aside. I will deal with each direction separately. Legislative framework [6] The power to issue a direction to rectify is contained in s 72 of the QBCC Act. Relevantly, that decision provides: (1) This section applies if the commission is of the opinion that— (a) building work is defective or incomplete; … (2) The commission may direct the person who carried out the building work to do the following within the period stated in the direction— (a) for building work that is defective or incomplete—rectify the building work; … -- 2 of 8 -- 3 … (3) In deciding whether to give the direction, the commission 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). … (5) The commission is not required to give the direction if the commission is satisfied that, in the circumstances, it would be unfair to the person to give the direction. Example for subsection (5)— The commission might decide not to give a direction for the rectification of building work because an owner refuses to allow a building contractor to return to the owner’s home or because an owner’s failure to properly maintain a home has exacerbated the extent of defective building work carried out on the home. [7] The issues for determination which arise were set out in Jarvis v Queensland Building and Construction Commission [2014] QCAT 693 at [3] as follows: (a) is the work ‘building work’? (b) is the building work ‘defective’? (c) is the applicant responsible for the defective building work? (d) is it fair or reasonable in the circumstances to direct the applicant to rectify the defective building work? Driveway [8] In its submissions filed on 10 August 2020, Bace conceded that the driveway is ‘building work’ as defined in Schedule 2 of the Queensland Building and Construction Commission Act 1991 (Qld) (‘QBCC Act’). [9] Bace also conceded that driveway is defective in that dusting has occurred. [10] However, Bace disputes that it is responsible for the defective building work. It also submits that it would be unfair to direct it to rectify the driveway. An assessment of these issues requires a detailed examination of the factual circumstances relating to the driveway. [11] It is not in dispute that the concrete driveway was constructed in or about April 2017. [12] Aaron O’Neill, a building supervisor employed by Bace, gave evidence that there were communications exchanged between the owners and Bace between May 2017 and October 2017 in relation to the driveway. [13] Mr O’Neill went on to state that Holcim sent out a technical representative to inspect the driveway in or around October 2017. The representative noted cracks of approximately 0.5mm concentrated around the control joints, as well as areas of dusting. The dusting was worst around the areas where the cars had to turn or pivot as they used the driveway. -- 3 of 8 -- 4 [14] Mr O’Neill stated that in or around March 2018, Bace offered to coat the surface of the driveway with a chemical hardener. The owners refused that offer. [15] Bace has relied upon the following passage from a report of NJA Consulting Pty Ltd dated 18 April 2019: The concrete driveway is exhibiting signs of dusting on the surface and subsequently the appearance of the concrete is not uniform. There are many areas where the sand and cement has been worn from the surface leaving exposure of the larger aggregates. The initial problem with the driveway appears related to dusting of the surface. On-going usage of the driveway has led to a weathering of the surface and created a non-uniform appearance to the driveway. It appears likely that the driveway has been subjected to frequent usage since the dusting problem was first noticed. [16] The report noted the following from the CCCA Publication on ‘Dusting of Concrete Surfaces’: • It is indicated that dusting is caused by the wearing surface being weak and the matrix not properly bonding to the fine aggregates. • It is indicated that dusting is caused by inadequate concrete specification, the addition of water in excess of that required, premature finishing, use of excessive water during finishing , or rainfall during placement. [17] The report also stated: One recommended method of repair is the application of a surface hardener (applied to concrete at least 28 days old). This method, while possibly rectifying the problem, would not change the visual appearance of the concrete. [18] I make the following observations: (a) The defect with the driveway arose during construction. The NJA Consulting Pty Ltd report indicates that dusting is related to conditions and factors that occurred during construction. (b) Mr O’Neill’s evidence is that Bace and the owners communicated in relation to the driveway as early as May 2017. I note that the driveway was constructed in or about April 2017, and dwelling was completed on 22 May 2017. In other words, there does not appear any meaningful period of time where the owners were not in communication with Bace about the driveway. (c) Bace did not offer to apply a chemical hardener until March 2018, which was 10 months after first entering into communications with the owners about the driveway and six months after the dusting was reported by the technical representative from Holcim in October 2017. By this time, as noted by the NJA Consulting Pty Ltd report, applying a surface hardener would not have rectified the existing surface deterioration. (d) In these circumstances, I consider the owners’ refusal of Bace’s offer to apply a chemical hardener to be reasonable. (e) I consider the timing of the owners’ lodgement of a complaint with the QBCC on 24 March 2018 to be reasonable. This occurred in the same month as Bace’s offer to apply a chemical hardener was made. Up to that point, the owners may -- 4 of 8 -- 5 have entertained some hope that Bace would offer to remedy the existing deterioration on the surface of the driveway. (f) I also consider the owners’ continued use of the driveway to be reasonable. The evidence before me indicates that dwelling was built on a battle axe block, and the driveway runs for approximately 95 metres. It would be unreasonable to expect the owners and any visitors to park on the street and traverse that distance on foot over a period of months. [19] In these circumstances, I find that Bace is responsible for the concrete driveway, and that it is fair and reasonable to give Bace the direction to rectify the driveway. [20] For completeness, I note that the ‘Rectification of Building Work Policy’ took effect on 10 October 2014, and remains in force. (3) Notification of defects 1. It is a policy of the Board that if a consumer is seeking the assistance of the Queensland Building and Construction Commission (QBCC) to issue a direction to a building contractor to rectify defective building work, the consumer must lodge a formal complaint with the QBCC of defective building work as soon as possible but no later than within 12 months of becoming aware of the defects. 2. The QBCC will then consider the issuing of direction to rectify to a building contractor: a. for structural defective building work, within 6 years and 3 months of the building work being completed; or b. for non-structural defective building work, within 12 months of the building work being completed. [21] Bace submits that it was not open to the QBCC to issue a direction to rectify on 18 July 2018 as this was more than 12 months after the building work was completed. [22] In my view, this submission misconstrues the policy. The first paragraph excerpted requires the making of a complaint. The second paragraph provides that the QBCC will then consider the issuing of a direction to rectify within particular timeframes depending on the category of defective building work. It is tolerably clear that the QBCC’s consideration relates to complaints made within those timeframes. [23] Even if I am incorrect in my construction, the complaint in the present case was made within 12 months after the building work was completed. Had the QBCC made a decision to issue a direction to rectify within 58 days of the complaint being made, such a direction would have been made within 12 months after the building work was completed. In my view, the remedies available to a home owner should not be held hostage to length of the QBCC’s deliberations on a complaint. I do not consider that the policy precludes the issuing of a direction to rectify merely because it took the QBCC 116 days rather than 58 days or less to make its decision. Onsite dispersion system [24] The parties disagree with respect to whether the onsite dispersion system is ‘building work’. [25] Schedule 2 of the QBCC Act defines building work relevantly to mean: -- 5 of 8 -- 6 (a) the erection or construction of a building; or … (c) the provision of lighting, heating, ventilation, air conditioning, water supply, sewerage or drainage in connection with a building; or (e) any site work (including the construction of retaining structures) related to work of a kind referred to above; … but does not include work of a kind excluded by regulation from the ambit of this definition. [26] ‘Building’ is in turn defined to include ‘any fixed structure’. The definition provides the following examples of a fixed structure: Examples of a fixed structure – • a fence other than a temporary fence • a water tank connected to the stormwater system for a building • an in-ground swimming pool or an above-ground pool fixed to the ground [27] It appears to me, on its face, that the onsite dispersion system, as a fixed structure, is properly to be considered as a building. Even if the onsite dispersion system is not a building, it would otherwise fall within ‘the provision of … drainage in connection with a building’ for the purposes of paragraph (c) of the definition of building work. [28] Bace submits that the onsite dispersion system is excluded from the definition of building work by the Queensland Building and Construction Regulation 1998 (Qld). Item 11 of Schedule 1 provides that the following types of work is not building work: 11 Work for water reticulation systems, sewerage systems or stormwater drains (1) Construction, extension, repair or replacement of a water reticulation system, sewerage system or stormwater drain, other than works connecting a particular building to a main of the system or drain. (2) In this section – building includes a proposed building. [29] The submission put by Bace is that the online dispersion system is the last point of discharge for the stormwater before being dispersed onto the ground. As such, it does not connect the building in question to a main of the system or drain. [30] However, what this submission overlooks is that the online dispersion system is not a ‘main … drain’. As Judge Kent QC observed in Morley v Queensland Building and Construction Commission [2017] QDC 95 at [11]: Item 11 may be seen as exempting from this scheme the situation where a local authority is constructing the overall infrastructure or headworks; this is not such a case. [31] Accordingly, the online dispersion system is not excluded from the definition of building work. [32] The QBCC provided a report from BT Plumbing Service dated 12 July 2018. That report relevantly stated: -- 6 of 8 -- 7 The rubble pit was examined to determine it’s suitability. Moreton Bay regional council has a preferred method of installation which shows a sizing of 1m wide by .5m deep by 1m long for every 50m2 of roof area … The current installation is not as per the preferred method … It is my opinion that the likely cause of the overflowing of the yard gullies and the gutters is the design of the rubble pit not allowing enough flow through the pit and the pipes are backing up during heavy rain. [33] The QBCC also provided a report from Steven Noble, a senior technical internal review officer. In his report dated 11 September 2018, Mr Noble concluded: [E]ach pit of 0.5m3 is expected to service a 40m2-50m2 area of roof drainage system. Given the roof drainage system exceeds 300m2 to each put, it is clear that the onsite dispersion system is significantly undersized to accommodate the stormwater surcharge. … It is determined that the onsite dispersion system provided to the South Western elevation is significantly undersized to accommodate the volume of stormwater conveyed by the roof drainage system, resulting in excessive stormwater overflowing from the gutter during normal showers and is not fit for purpose. [34] In an addendum report dated 4 January 2019, Mr Noble stated: The reduced capacity of the outlets to the onsite drainage system prevents the roof drainage system from conveying stormwater effectively via the down pipes, causing the gutter to reach capacity and discharge via the overflow provision at the top of the gutter. The roof drainage system forms part of a system that relies upon the adequate dispersion of stormwater at the legal point of discharge. [35] Bace maintains that the overflowing gutters were caused by an insufficient number of downpipes, and that the issue of overflowing gutters was not resolved until after it installed additional downpipes. [36] In my view, Bace’s submission misses the point. The expert evidence provided by the QBCC all points to the onsite dispersion system as being undersized for the roof area. Bace provided no expert evidence to indicate that the onsite dispersion system was appropriately sized. In these circumstances, the only conclusion that I can reach is that the onsite dispersion system was defective. I note that the definition of ‘defective’ in Schedule 2 of the QBCC Act includes work that is ‘faulty or unsatisfactory’. The undersized onsite dispersion system was at the very least unsatisfactory. [37] Bace submits that it would not be fair and reasonable to order rectification, as the issue was resolved by the installation of additional downpipes. I accept Bace’s conclusion, but not its reasoning. [38] The complaint relating to the onsite dispersion system was resolved by BT Plumbing Service connecting the stormwater pipes to a previously unknown Council stormwater pit on the neighbouring property. In a statement dated 2 April 2019, Ben Theslow stated: During the site inspection for the beginning the rectification works it was noted that a council stormwater pit was close to the boundary of Mr David Simmons -- 7 of 8 -- 8 (near one of the rubble pits) and a neighbouring property. A stormwater pit is, to my understanding, Moreton Bay Regional Council’s preferred legal point of discharge, over a rubble pit. As connecting the stormwater to the adjoining property’s stormwater pit instead of new rubble pits would save costs, reduce maintenance for the home owner and provide a better outlet for the stormwater (the stormwater will flow freely out of the two stormwater lines installed into the stormwater pit as opposed to filling and overflowing out of a rubble pit) I spoke and sent email correspondence with Sedgwick Building Consultants who conferred with QBCC as to whether this was an acceptable alternative to the original scoped works. I received approval via email to alter the scope on 5 th November 2018 … Works were then carried out on Mr Simmons property with two new 150mm stormwater lines installed to the new pit and connected with the four existing stormwater lines to the roof and site drainage. [39] In other words, the complaint relating to the undersized onsite dispersion system was not resolved by increasing the size of the system. Instead, the complaint was resolved by connecting to a previously unknown Council stormwater pit. There is no evidence before me that the existence of the Council stormwater pit was known to Bace, and it is not the QBCC’s case that Bace should have known about the existence of the pit at the time the online dispersion system was installed. [40] In those circumstances, I do not consider that it is fair and reasonable to give Bace a direction to rectify the onsite dispersion system where rectification of the onsite dispersion system was not required. Disposition [41] The direction to rectify in respect of the driveway is confirmed. [42] The direction to rectify in respect of the onsite dispersion system is set aside, and a new decision is substituted not to issue a direction to rectify in respect of the onsite dispersion system. -- 8 of 8 --