BPH Brancatella Plant Hire Pty Ltd t/as Brancatella Plant Hire v JAXL Holdings Pty Ltd [2021] QCAT 356

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL CITATION: BPH Brancatella Plant Hire Pty Ltd t/as Brancatella Plant Hire v JAXL Holdings Pty Ltd [2021] QCAT 356 PARTIES: BPH BRANCATELLA PLANT HIRE PTY LTD T/AS BRANCATELLA PLANT HIRE (applicant) v JAXL HOLDINGS PTY LTD (respondent) APPLICATION NO/S: BDL212-20 MATTER TYPE: Building matters DELIVERED ON: 20 October 2021 HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Senior Member Brown ORDERS: The parties must file in the Tribunal two (2) copies and exchange one (1) copy of submissions addressing the orders and directions to be made giving effect to these reasons within fourteen (14) days. CATCHWORDS: COURTS AND JUDGES – COURTS – JURISDICTION AND POWERS – TRANSFER OF PROCEEDINGS TO OR FROM HIGHER COURT AND BETWEEN COURTS – OTHER MATTERS – where parties entered into a building contract – where the amount in dispute in the claim and the counter claim exceeds $50,000 – where the proceedings were commenced in the Magistrates Court – where the respondent applied to have the matter transferred to the Tribunal – where the applicant opposed the application to transfer the proceedings – where the Magistrates Court ordered the transfer of the proceedings to the Tribunal – where the applicant subsequently consented to the transfer – whether the Tribunal has jurisdiction to hear the matter – consideration of s 94 of the Queensland Building and Construction Commission Act 1991 (Qld) Queensland Building and Construction Commission Act 1991 (Qld), s 77, s 78, s 79, s 94 Eyres v Butt [1986] 2 Qd R 243 -- 1 of 10 -- 2 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 This is the determination of a preliminary issue that raises two interesting points regarding the jurisdiction of the tribunal to hear and decide a building dispute. BPH commenced proceedings in the Magistrates Court claiming $55,261.10 for money due and owing from JAXL in respect of building work undertaken by BPH. The following matters are not contentious:1 (a) The parties entered into a written sub-contract for the performance by BPH of earthwork and stormwater siteworks at Birkdale; (b) The contract price was $199,825.00; (c) BPH performed the sub-contract works. BPH alleges that the contract price was varied to an amount of $213,873.72 (excluding GST), that JAXL paid to BPH $163,636.36 and that the amount owing by JAXL (inclusive of GST) is $55,261.10. BPH also alleges that JAXL wrongfully terminated the contract. JAXL denies that the contract price was varied and says that the works performed by BPH were not in accordance with the contract, that it did not terminate the contract, and that BPH has no entitlement to the amount claimed. JAXL filed a counterclaim in the Magistrates Court proceedings claiming damages for breach of contract in the amount of $43,950.00 and liquidated damages of $51,500.00.2 In reply to the counterclaim, BPH asserts that it is entitled to damages in the amount of $10,047.47 (excluding GST) for loss of profit as a consequence of JAXL’s wrongful termination of the contract. As can be seen from the foregoing summary both the amount claimed by BPH and the amount counter-claimed by JAXL exceed $50,000.00. The relevance of the amount of $50,000.00 will be made clear later in these reasons. On 19 June 2020 a magistrate ordered the transfer of the Magistrates Court proceedings to the tribunal. I am unable to discern whether the learned magistrate gave reasons for the decision. If reasons were given they have not been provided to the tribunal by either of the parties. After the transfer of the proceedings to the tribunal directions were made for the parties to file submissions addressing the following preliminary issue: (a) Are the proceedings liable to be dismissed on the basis that the parties have not complied with s 79(1) of the Queensland Building and Construction Commission Act 1991 (Qld); (b) Are the proceedings liable to be dismissed on the basis that both parties to the dispute did not apply to the Magistrates Court to transfer the proceeding to the 1 Based upon the pleadings filed in the Magistrates Court proceedings. 2 Calculated to the date of the filing of the counterclaim. -- 2 of 10 -- 3 Tribunal as required by s 94 of the Queensland Building and Construction Commission Act 1991 (Qld); and (c) If the proceedings are liable to be dismissed, should BPH Brancatella Plant Hire Pty Ltd t/as Brancatella Plant Hire have liberty to commence a further proceeding for a major commercial building dispute subject to compliance with s 77(2) and s 79 of the Queensland Building and Construction Commission Act 1991 (Qld).. Building disputes – the statutory framework The tribunal is creature of statute and has only the powers conferred upon it by the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act) and any relevant enabling Act which in this case is the QBCC Act. The tribunal has jurisdiction to decide building disputes.3 A building dispute may be a domestic building dispute, a minor commercial building dispute or a major commercial building dispute.4 A major commercial building dispute is one where either the amount of the claim or the counterclaim exceeds $50,000.00.5 There are a number of gateway provisions relevant to pursuing proceedings for a major commercial building in the tribunal. Section 77(2) of the QBCC Act provides that a person may not apply to the tribunal to have a building dispute decided unless the person has complied with a process established by the commission to attempt to resolve the dispute. Section 78 of the QBCC Act provides that a major commercial building dispute may be decided by the tribunal only if the tribunal is satisfied all parties to the dispute consent to it doing so. An application to start a proceeding for a major commercial building dispute must be accompanied by the written consent of all parties to the dispute. Section 94 of the QBCC Act provides that if proceedings for a major commercial building dispute are brought in a court, the court may order that the proceeding be transferred to the tribunal only if all parties to the dispute apply for the order. What do the parties say? In its submissions addressing the preliminary issue BPH says: (a) The works, predominantly earthworks, were carried out at a townhouse development which involved the construction of multiple co-joined townhouses; (b) Neither party is the holder of a Queensland building licence as BPH is a civil works contractor and JAXL is a property developer based in Victoria; (c) When BPH sought to refer the dispute to the QBCC, the QBCC advised that it would not undertake conciliation as it did not have jurisdiction in respect of the dispute. This was because neither party held a Queensland building licence; 3 QBCC Act, s 77(1). 4 QBCC Act, schedule 2. 5 Ibid. -- 3 of 10 -- 4 (d) The Magistrates Court proceedings were subsequently commenced; (e) JAXL applied to transfer the proceedings to the tribunal; (f) BPH opposed the application to transfer the proceedings; (g) The application was heard on 19 June 2020 and the magistrate ordered the transfer of the proceedings to the tribunal; (h) Subsequently, BPH ‘pragmatically’ agreed with JAXL to submit to the jurisdiction of the tribunal and the parties subsequently communicated their consent to the tribunal in a joint letter dated 22 January 2021; (i) Section 77(2) of the QBCC Act does not apply in the present dispute as the QBCC has no jurisdiction over either party to attempt to resolve the dispute; (j) There was no process established by the QBCC to attempt to resolve the dispute; (k) Both parties consent to the tribunal having jurisdiction in respect of the dispute thus satisfying the requirements of s 79 of the QBCC Act; (l) Neither the parties nor the Tribunal have review powers over the Magistrates Court in respect of the effect of s 94 on the Magistrates Court decision. Therefore the tribunal cannot determine that the Magistrates Court was wrong in making its order; (m) The proceeding may be heard by the tribunal by virtue of the consent of the parties to the jurisdiction of the tribunal; (n) For either or both of the following reasons, s 94 does not affect the jurisdiction of the Tribunal to hear the matter: (i) the Magistrates Court order must for efficacy, by s 53(2)(b) of the QBCC Act, be implied to have ordered that the parties be taken to have complied with any other requirements of the QBCC Act or enabling Act, which implied order then takes precedence over s 94 of the QBCC Act by s 53(3) of the QBCC Act but if not, then; (ii) the parties have consented to the proceeding being heard as a major building dispute in the tribunal, therefore by this subsequent consent, the proceeding could be transferred to tribunal and heard by section 53(1) of the QBCC Act. JAXL agrees with BPH’s submissions and in addition says that s 94 of the QBCC Act does not affect the jurisdiction of the tribunal to hear the matter because the parties have consented to the transfer of the matter to QCAT and as such the matter can be heard in accordance with s 53(1) of the QBCC Act. It should be noted that the reference by both of the parties to s 53 of the QBCC Act should be a reference to the QCAT Act. It is clear both parties wish the proceedings to remain in the tribunal. Consideration The jurisdiction of the tribunal to hear and decide building disputes is strictly circumscribed. The QBCC Act places building disputes into three categories: domestic building disputes, minor commercial building disputes and major -- 4 of 10 -- 5 commercial building disputes. The pathway to the tribunal in respect of each of these types of disputes has one important similarity and one important difference. The similarity is the requirement for a person to a building dispute to satisfy the requirements of s 77(2) of the QBCC Act before filing an application. Section 77(2) provides that a person involved in a building dispute who wishes to apply to the tribunal to have the tribunal decide the dispute must first comply with a process established by the QBCC to attempt to resolve the dispute. Section 77(2) is a mandatory provision and a failure to comply with the section is a bar to proceedings being commenced in the tribunal. The requirement in s 77(2) is to comply with a process established by the QBCC. If there is no such process then a person’s path to the tribunal in respect of a building dispute is unimpeded by s 77(2). The important difference between the types of building disputes to which I have referred is the requirement that parties to a major commercial building dispute must consent to the tribunal having jurisdiction to decide the dispute. Consent is not required in respect of other building disputes. Section 78 of the QBCC Act provides: 78 When major commercial building dispute may be heard by tribunal A major commercial building dispute may be decided by the tribunal only if the tribunal is satisfied all parties to the dispute consent to it doing so. There are two ways in which a major commercial building dispute may come before the tribunal. The first is by way of an application filed in the tribunal’s original jurisdiction. The second is by way of transfer of an existing proceeding from a court. Common to both pathways is the critical requirement for the consent of the parties. The QBCC Act addresses the requirement for consent in respect of each of these pathways in different ways. Where proceedings are commenced in the tribunal, the written consent of the parties to the jurisdiction of the tribunal must be filed with the originating application. Section 79 of the QBCC Act provides: 79 Procedure to decide whether all parties consent (1) An application to start a proceeding for a major commercial building dispute must be accompanied by the written consent of all parties to the dispute. (2) The written consent must include an acknowledgement by the consenting party that the consent can not be withdrawn. (3) The tribunal may, before another step is taken in the proceeding, conduct a pre-hearing conference to decide whether there is another person who should be joined as a party to the dispute. (4) If the tribunal decides that there is another person who should be joined as a party to the dispute, the tribunal— (a) must give the consenting parties an opportunity to obtain the written consent of the other person; and (b) may hear the dispute only if the other person consents. (5) If the consenting parties obtain the consent of the other person, the tribunal must join the other person as a party to the dispute. -- 5 of 10 -- 6 (6) The consent of all parties to the dispute must be obtained before another step is taken in the proceeding. Section 81 of the QBCC Act provides: 81 Consent may not be withdrawn A party that gives written consent to have a major commercial building dispute heard and decided by the tribunal can not withdraw the consent. Section 94 of the QBCC Act deals with the transfer of proceedings from a court to the tribunal: 94 Transfer of proceedings between tribunal and the courts If proceedings relating to a major commercial building dispute are brought in a court, the court may order that the proceeding be transferred to the tribunal only if all parties to the dispute apply for the order. (emphasis added) Where a party applies to transfer proceedings from a court to the tribunal, s 94 makes clear that the court must be satisfied that the parties to the dispute consent to the jurisdiction of the tribunal. This is evident from the words ‘only if all parties to the dispute apply for the order.’ The corollary of this is that if an application to transfer proceedings from a court to the tribunal is opposed, then clearly all parties to the dispute have not applied for the order. Relevant to the jurisdiction of the tribunal to decide a major commercial building dispute is whether the absence of the consent of the parties is a procedural irregularity that may be waived. For reasons that will be made clear, this consideration is relevant in respect of major commercial building disputes both where a proceeding is commenced in the tribunal or where a proceeding is transferred from a court. Section 61(1)(c) empowers the tribunal to waive compliance with a procedural requirement under the QCAT Act, an enabling Act or the Rules. In Eyres v Butt6 the Queensland Court of Appeal referred to two categories of cases, the first being where procedural irregularities may be waived by the parties, and the second being where procedural irregularities are destructive of jurisdiction. Eyres involved a proceeding commenced and decided in the District Court where the parties, despite having consented to the court having jurisdiction, failed to comply with the formal requirements of the District Courts Act 1967-1982 in respect of such consent. Section 73 of the Act provided: 73. Consent jurisdiction. If both parties agree, by a memorandum signed by them or their solicitors, that any specified District Court shall have jurisdiction to try any action which might be brought or any counter-claim which might be made in the Supreme Court, that District Court shall have jurisdiction to try the action or counter-claim, or both. The memorandum shall state that the parties signing it know that the action or as the occasion shall require, the counter-claim, is not within the jurisdiction of the District Court without such consent, and shall be filed with the Registrar in the case of an action at the time when the plaint is entered and in the case of a counter-claim, at the time the defence and counter-claim is filed or at such later 6 [1986] 2 Qd R 243 -- 6 of 10 -- 7 time as a Judge, on application made in that behalf, may allow. (emphasis added) Connolly J referred to the following passages from Spencer Bower and Turner, Estoppel by Representation (3rd ed.): Not even the plainest and most express contract or consent of a party to litigation can confer jurisdiction on any person not already vested with it by the law of the land, or add to the jurisdiction lawfully exercised by any judicial tribunal; it is equally plain that the same results cannot be achieved by conduct or acquiescence by the parties. Any such attempt to create or enlarge jurisdiction is in fact the appointment of a judicial officer by a subject, and as such constitutes a manifest usurpation of the Royal prerogative. … Accordingly, in all cases of the first class, that is, where it is sought by estoppel to enlarge the jurisdiction of any tribunal of limited jurisdiction, or to confer jurisdiction on any tribunal or person to whom it is not given by law, it has been held that it is impossible by contract to achieve these ends contrary to the provisions of a statute; and similarly no estoppel can be invoked to produce a result.7 Connolly J found that the failure by the parties to file the required memorandum of consent was a mere irregularity of procedure. Thomas J found that the preparation and filing of the memorandum was not an imperative requirement destructive of jurisdiction in the absence of strict compliance. His Honour held that the substantial requirement was the agreement of the parties, and that its reduction to writing and the filing were procedural requirements capable of being waived. The important distinction between s 73 of the District Courts Act and the relevant provisions of the QBCC Act is that the tribunal has no power to extend the time for the filing of the consent to jurisdiction. In Eyres Connolly J stated: Two further features of s. 73 should be noted. If the memorandum is filed when the plaint is entered the enlargement of jurisdiction is entirely a matter for the parties. However, if it is sought to enlarge the jurisdiction at a latter time the leave of the judge is required. In the circumstances of this case, there can be doubt that the leave of the learned judge would have been forthcoming. His Honour, in fact, raised one procedural matter when informed of the enlargement of jurisdiction, assuming that an amendment of the plaint by consent was envisaged. His readiness to grant leave is implicit in his judgment.8 In Atcheson, P. & N. v Scacheri, G.R. and Skehan, G. and Geoff Skehan Constructions Pty Ltd 9 the former Queensland Commercial and Consumer Tribunal considered the requirement for the consent of the parties to the tribunal’s jurisdiction before commencing a proceeding for a major commercial building dispute. In Atcheson a proceeding in respect of a major commercial building dispute had been commenced in the absence of compliance with s 78 and s 79 of the QBCC Act. The tribunal considered the decision in Eyres and found the difference between s 73 of the District Courts Act and the provisions of the QBCC Act to be of central importance: 7 Ibid, 247. 8 Ibid. 9 [2006] QCCTB 152. -- 7 of 10 -- 8 The written "consent" must be filed with the application (as with the first requirement or limb of section 73 in the Eyres’ decision). However, in this instance (unlike section 73 in Eyres), there is no other alternative form of consent permitted in sections 78, 79 and 81, whether with the approval/leave/satisfaction of the Tribunal or otherwise. Even if, in this instance, consent can be implied from the conduct of these parties subsequent to the filing of the process, such that may, in ordinary circumstances, give rise to an estoppel of the type referred to in Eyres, that does not have the effect of providing a resultant enlarged jurisdiction in the Tribunal, as the consent required for that enlarged jurisdiction was consent prior to the commencement of the proceedings. Additionally, it was a consent as to which, after a set procedure, the Tribunal had to be satisfied.10 I respectfully agree with the reasoning of, and conclusion reached by, the tribunal in Atcheson. The tribunal is a creature of statute and notwithstanding that it is a court of record its jurisdiction is confined to that conferred upon it by the QCAT Act and the relevant enabling Acts. The filing of the written consent of the parties as required by s 78 and s 79 of the QBCC Act is a mandatory pre-condition to the jurisdiction of the tribunal to hear and decide a major commercial building dispute. The parties to a dispute may not, by agreement or conduct, confer upon the tribunal a jurisdiction it does not have. As such, the requirements mandated by s 78 and s 79 are not procedural requirements that may be waived. This leads to a consideration of the second pathway by which a major commercial building dispute may reach the tribunal, that is, the transfer of a proceeding from a court. As I have observed, s 94 of the QBCC Act provides that before a proceeding for a major commercial building dispute can be transferred from a court to the tribunal the court must be satisfied that the parties to the dispute consent to the transfer. The first thing to observe is that the intent of s 94, insofar as it relates to the parties to a dispute consenting to the jurisdiction of the tribunal, is consistent with s 78, s 79, s 80 and s 81. Firstly, there must be consent of both parties to the tribunal having jurisdiction. Secondly, that consent must be forthcoming before the tribunal has jurisdiction in respect of the matter. Thirdly, the consent once given cannot be withdrawn. As to the first matter, all parties to the dispute must apply for the order to transfer the proceedings. As to the second matter, the agreement of the parties is required before the court orders the transfer of the proceedings. As to the third matter, a consent to an order of a court cannot be withdrawn by a party once the order is made. The party must apply to have the order set aside. This cannot be done once the proceeding has been transferred to the tribunal. Having concluded that the requirement for consent to jurisdiction is a mandatory pre- condition to the commencement of proceedings in the tribunal in respect of a major commercial building dispute it would clearly be incongruous to construe s 94 in a manner inconsistent with the clear intention of the Act that the consent of the parties must be forthcoming at the time proceedings are commenced in, or transferred to, the tribunal. Support for this conclusion can be found in a brief examination of the history of s 94. 10 Ibid, [38] -- 8 of 10 -- 9 Section 94 of the QBCC Act was inserted by the Commercial and Consumer Tribunal Act 2003. The first (slightly different) iteration of the provision was found in s 117(2) of the now repealed Queensland Building Tribunal Act 2000 (Qld) which provided: (2) To remove doubt, it is declared that if proceedings relating to a major commercial building dispute are brought in a court, the court may order that the proceeding be removed to the tribunal only if all parties to the dispute apply for the order. The Explanatory Notes to the original bill state: Clause 117 deals with jurisdictional overlaps between the Tribunal and courts. Where the Tribunal has jurisdiction, any party to a proceeding before a court can apply for the proceeding to be removed to the Tribunal and the court must so order. For major commercial building disputes, that is where the consent jurisdiction applies, all parties must consent to any application for removal before a court can make such an order. The Tribunal may also order that all or part of a proceeding be removed to a court where it is of the view that it does not have jurisdiction. If a proceeding is removed to a court from the Tribunal, the court must deal with the matter and not remove it back to the Tribunal. This distinction applies because of the Tribunal’s lower costs and specialist understanding of building disputes. (emphasis added) It is clear from the foregoing that the consent of the parties is a mandatory pre- condition to an order being made transferring proceedings in respect of a major commercial building dispute from a court to the tribunal. Both parties submit that it is not open to this tribunal to review the Magistrates Court order transferring the proceedings. I agree. However the issue presently before the tribunal for determination is not a review of the Magistrates Court order but the jurisdiction of the tribunal to hear and decide the present dispute. The tribunal must be satisfied that the parties consented to the jurisdiction of the tribunal before the transfer of the proceedings from the Magistrates Court to the tribunal. Absent such consent, and for the reasons I have set out, the tribunal does not have jurisdiction to hear and decide the dispute. To construe s 94 of the QBCC Act in the way submitted by the parties would be entirely inconsistent with the clear meaning and intent of s 78, s 79, s 80 and s 81. It cannot in my view have been the intention of the legislature that parties to a major commercial building dispute may, after proceedings have been transferred to the tribunal from a court, consent to the jurisdiction of the tribunal. This would be to treat a dispute, the subject of the court proceedings, in a manner entirely different to a dispute where the parties commence proceedings in the tribunal. There is nothing in the legislative provisions to which I have referred that would support the construction favoured by the parties. Both parties did not apply to have the proceedings transferred from the Magistrates Court. Accordingly, there was not the required consent of the parties to the jurisdiction of the tribunal before the proceedings were transferred. Consent to the jurisdiction of the tribunal in respect of a major commercial building dispute cannot be forthcoming after proceedings have been commenced in, or transferred to, the tribunal. Absent such consent as is required by the QBCC Act, the tribunal does not have jurisdiction in respect of the present dispute. It seems to me that, in the circumstances, the tribunal may either transfer the proceedings back to the court in accordance with s 52(2) of the QCAT Act or dismiss -- 9 of 10 -- 10 the proceedings pursuant to s 47(1) of the QCAT Act and for the proceedings to be recommenced in the tribunal subject to leave be granted by the President or the Deputy President in accordance with s 49(2) of the QCAT Act. Alternatively, the applicant and the respondent may withdraw, respectively, the application and the counter application pursuant to s 46(1) of the QCAT Act in which event further proceedings may be commenced with the leave of the tribunal in accordance with s 46(3). I will make directions for the parties to file and exchange submissions on further orders and directions to give effect to these reasons. -- 10 of 10 --