Dixon v Timber Trend Kitchens Pty Ltd [2018] QCAT 133

CITATION: Dixon v Timber Trend Kitchens Pty Ltd [2018] QCAT 133 PARTIES: Neil Dixon (Applicant/Appellant) v Timber Trend Kitchens Pty Ltd (Respondent) APPLICATION NUMBER: BDL 109-17 MATTER TYPE: Building matters HEARING DATE: 12 March 2018 HEARD AT: Brisbane DECISION OF: Member King-Scott DELIVERED ON: 2 May 2018 DELIVERED AT: Brisbane ORDERS MADE: The Respondent Timber Trend Kitchens Pty Ltd pay Neil Dixon the sum of $21,154.90 by 4.00 pm 31 May 2018. CATCHWORDS: BUILDING CONTRACT – REQUIREMENT IN WRITING BUT NOT SIGNED – MISTAKE – where subcontractor underquotes – other party not aware of mistake – unilateral mistake – subcontractor alleges contract not signed therefore not binding – requirement of contract Queensland Building and Construction Commission Act 1991 (Qld), s 67G General Credits Ltd v Ebsworth (1986) 2 Qd R 162 Prudential Assurance Co Ltd v CM Breedon Pty Ltd [1994] 2 VR 452 River Late Properties Ltd v Paul (1975) Ch.133 APPEARANCES and REPRESENTATION: APPLICANT: Mr N Dixon self represented -- 1 of 7 -- 2 RESPONDENT: Mr Russell Piggott Director of the Respondent self represented REASONS FOR DECISION Introduction [1] The Applicant, Neal Dixon, is a building contractor who was engaged to convert an office space to 2 residential units at 514 Brunswick Street Fortitude Valley. [2] The owners were Mr Dixon and his wife Linda. There was a formal Master Builders Residential Building Contract entered into with Mr Dixon, as contractor and he and his wife as owners. [3] In August 2017, Mr Dixon sought a quote from the Respondent, Timber Trend Kitchens Pty Ltd (Trend Kitchens). He provided plans for that purpose. The initial email contact seems to have been addressed to the sole director of Trend Kitchens, Russell Piggott.1 [4] Mr Dixon had previously had contact with Mr Pigott when Mr Dixon was site manager for a construction company Devport. However, the contact on this occasion was in relation to his own project. In some documents he refers to his trading name, Dixonbuilt. Evidence [5] Mr Dixon and Mr Piggott were the only witnesses to give evidence. The bulk of the evidence was contained in written statements. Mr Piggott provided only a very sparse statement responding to Mr Dixon’s statement and an initial statement making certain admissions to the effect that the deposit should be refunded as should certain plumbing items which I will refer to below. [6] Subsequent dealings with Trend Kitchens were with its estimator Donna Hall. Ms Hall, at the time of the hearing, had worked for Trend Kitchens for at least eight years. [7] A quote dated 24 August 2016 was received for $9,215.35 to supply and install. It was as follows: We have the pleasure in submitting to you our quotation for the supply and installation of joinery items as drawings received and as detailed below. Plans to be client approved Kitchens x 2: 20mm Smart Stone Theron tops with shadow line, PVC edged doors Moss Grey Sheen with Rocco Lini to Servery Back and Island Gable Unit 7 only. Nover Lip pull Handles included, Finger pull Overheads 1 See email dated 22 August 2016. -- 2 of 7 -- 3 Bath x 2: 20mm Smart Stone Theron tops with shadow line, PVC edged doors Moss Grey Sheen. No Drawers included Ensuite x 2 20mm Smart Stone Theron tops with shadow line, PVC edged doors Moss Grey Sheen. Drawers included Laundry x 2 P/fromed Laminate Rocco Lini tops PVC edged doors Moss Grey Sheen. [8] Mr Dixon by email dated 6 September 2016 asked that his order be put into the production queue. He anticipated installation approximately mid to late October. [9] By email dated 23 September 2016, Trend Kitchens provided a credit application and a request for a 30% deposit. By email the following day Mr Dixon returned the signed credit application. There was also a request for some minor changes to the plans. [10] By email dated 29 September 2016 Trend Kitchens was advised the deposit of $2,764.60 was transferred to their account [11] In a revised quote forwarded by email dated 12 October 2016 Ms Hall advised that she had not included the stone price. The revised quote was for $16,286.60. It was not accepted by Mr Dixon who requested some adjustments to the original quote. [12] By email dated 13 October 2016, Ms Hall adjusted the original quote to include changes in both units. It is appropriate that I referred to the email in part: I can appreciate where the client is coming from, but everyone does make mistakes. I have adjusted the original quote to include the changes to both units-the price has increased by $1,619 plus GST this is mainly due to the changes in benchtop to u2. This is the best price I can do. Can you please advise of client will accept this. I have attached a revised quote and also current kitchen design with two more options to u2. [13] Mr Dixon responded by email dated 14 October 2016 to the effect that “My client is prepared to take up the offer below i.e. Total $10,993.40.…" That amount is reached by adding to the original quote the sum of $1,619.00 plus GST. [14] By way of response, Ms Hall requested that Mr Dixon arrange for one sink, one basin and one tub to be delivered to Trend Kitchens for the purposes of measurement. That was done. [15] Mr Dixon also posted a Master Builders Contract signed and dated by him. It is dated 14 October 2016. Mr Pigott in evidence admitted that he received the document. [16] By email dated 1 November 2016 Mr Dixon advised that the premises were ready for a measure up. [17] Mr Dixon referred to a diary note on 7 December 2016 relating to a phone call he had with Mr Piggott. He initiated the call which was not answered and he left a message. Mr Piggott returned his call. Mr Dixon diary notes -- 3 of 7 -- 4 that Mr Piggott advise the kitchen install will be on 14 December 2016 and he was ready to go. Telephone records reveal the call was a minute or less in duration. [18] On 12 December 2016 Mr Dixon received an email from Ms Hall to the following effect: As previously advised the original quote did not have the price for the stone added in, I have just been advised by management that unless the attached quote is accepted (which is the original quote before changes plus a stone needed in) we will not do the job. Can you please sign and send back as acceptance or if you choose not to accept this we will refund your deposit. [19] The new quote was for $15,790.50 an increase of $4,797.10. Understandably, Mr Dixon was unimpressed. He endorsed on the bottom quote which he returned the following: Proceed with the cabinet manufacture/install ASAP to mitigate my potential losses i.e. $1,000 pw liquidated damages, on the basis that I reserve my rights to challenge the amended variation at a later date. Russell advised on 7 December 2016, that delivery/install would take place on 14 December 2016, therefore can you confirm any changes to this date? Regards [20] As stated above, both Mr Piggott and Mr Dixon gave evidence. The only area of dispute was that Mr Piggott says the absence of the stone on the contract was discussed on the telephone conversation of 7 December 2016 and that Mr Dixon became threatening. This is denied by Mr Dixon, he says there was no mention of the missing stone on 7 December 2016 and the conversation was perfectly amiable. [21] Mr Piggott made references to threats in his cross application He said “Several threats were made to myself personally by Neil Dixon which today can be regarded as a form of harassment which I take offence to." Elsewhere, in the same document, he submits that he did not sign the QMBA contract and as a result damages cannot be claimed as no contract exists no breach has occurred. He agrees that he still has the deposit and by way of explanation says that it was not refunded because he did not have the bank account details. He still has in his possession the 3 plumbing items being the sink, basin and tub which have not been returned despite several requests. He accepts that the claim for $654 for those items is correct. [22] If it is necessary to make a finding of credit then I prefer the version of Mr Dixon to that of Mr Piggott. Mr Piggott appeared quite dismissive of the claim and oblivious to any inconvenience and potential damage Trend Kitchen’s conduct had caused Mr Dixon. On the other hand Mr Dixon did not impress me as a person who would make threats but one could well understand his annoyance at the way he had been treated. Was there a contract? [23] Trend Kitchens submits that there was no contract as it was not signed by them. Mr Dixon accepted the initial offer of $9,215.35 by email dated 6 September 2015. Trend Kitchens requested a 30% deposit and a signed -- 4 of 7 -- 5 credit application. The credit application was completed and forwarded on 27 September 2016. The deposit was paid on 29 September 2016. [24] At that stage there was a contract between the parties. The contract was not a domestic building contract as it was a contract between a building contractor and subcontractor.2 The contract was a building contract under Part 4A of the Queensland Building and Construction Act 1991 (the Act)3 and did not have to be in writing as it was less than $10,000.00.4 [25] On 12 October 2016 Ms Hall advised of her error in quoting and submitted a revised quote. Negotiations ensued and a variation was agreed. The offer made by Ms Hall on behalf of Trend Kitchens was to increase the original quote by $1,619.00 plus GST5. It attached the quote which was not included in the filed material. Trend Kitchens in its response do not submit that it was not for $10,993.00. That sum was accepted by email dated 14 October 2016. This email amounted to an implied acceptance of what was in essence a variation of the contract. [26] Ms Hall’s response was her email dated the same day requesting delivery of sinks, basins and tubs for fitting and dimensions of appliances. Trend Kitchens submit a staff member made the request, and, I presume by implication was not an agent of Trend Kitchens. I reject this, Ms Hall was involved in most, if not all negotiations and was held out as having authority to negotiate on behalf of Trend Kitchens. [27] At this point the contract had to be reduced to writing.6 [28] A contract in writing was posted to Trend Kitchens at or about the time it is dated, namely, 14 October 2016. Trend Kitchens admits it received the document. The written contract was forwarded following negotiations which included Mr Dixon advising that his client was prepared to take up the offer of $10,993.40. He then forwarded the written contract. [29] Discussions continued between the parties for an installation date in December 2016. [30] In my opinion, a contract came in to existence between the parties on 14 October 2016 and was formalised in the written document dated 14 October 2016, which complied with Part 4A of the Act. The sole basis that Trend Kitchens disputes any agreement seems to be on the basis that it did not sign the document. Mistake [31] At no time, prior to it realising it had made a further mistake in not including the price of the stone in its quote, did Trend Kitchens dispute the existence 2 See s 3 Schedule 3B Queensland Building and Construction Act 1991. 3 See s 67AAA. 4 See 67G (1)(b) Queensland Building and Construction Act 1991. 5 Email dated 13 October 2016 Hall to Dixon. 6 S67G (2)(c) Queensland Building and Construction Act 1991. -- 5 of 7 -- 6 of a contract. By email dated 12 December 2016 it advised Mr Dixon of its mistake. [32] Although, that may have been Ms Hall’s mistake I do not accept that Mr Dixon was aware of it. It might be argued that the significant difference in price between the initial quote and the first revised quote should have alerted him to that fact. In fact, it was not argued. Indeed, it has never been suggested that he was or should have been aware of it. It was not raised in any subsequent correspondence nor in the filed material nor was it raised in the course of the hearing. [33] The negotiations that preceded the last quote allowed for a number of adjustments as well as a request by Mr Dixon to substantially lower the quote. In the email dated 13 October 2016 Mr Dixon said: I have put your revised quote to my client and she has dismissed the variation. She further advises if need be she will accept the original plan layout to which she has already paid the deposit on. If minor variations can’t be done without increasing the price by 80% approx. it makes it difficult for me to reason with the client. Can you revisit your most recent quote and adjust where possible and advise ASAP of any amendments thanks [34] I am aware that, although the email is written as if “the client” is a third party, the client was, in fact, Mr Dixon and his wife. A fact that both parties were aware of. It was submitted by Trend Kitchens that the quote was done for an entity Devport and not Dixonbuilt. Mr Dixon, previously worked for Devport. However, from the time of the lodgement by Mr Dixon of the Credit Application that Trend Kitchens required, Trend Kitchens was aware with whom they were contracting. [35] Where a mistake is made by one party, neither in law nor in equity, can a party have the contract set aside on the basis of unilateral mistake.7 [36] It follows that Mr Dixon is entitled to damages for breach of contract. [37] Mr Dixon was advised by email dated 12 December 2016 that the original quote, again, did not include the price of stone and unless he accepted the revised quote, which now stood at $15,790.50, Trend Kitchens would not do the job. Mr Dixon responded, by endorsing the quote with the following: Proceed with the cabinet manufacture/install ASAP to mitigate my potential losses i.e. $1000 per week liquidated damages, on the basis that I reserve my rights to challenge the amended variation at a later date. Russell advised on 7 December 2016 that delivery/install would take place on 14 December 2016, therefore, can you confirm any changes to that date? [38] By email dated 14 December 2016, Ms Hall advised that management did not accept his notation on the signed quote and would be refunding the deposit. 7 River Late Properties Ltd v Paul (1975) Ch. 133, General Credits Ltd v Ebsworth (1986) 2 QdR 162 and Prudential Assurance Co Ltd v CM Breedon Pty Ltd [1994] 2 VR 452. -- 6 of 7 -- 7 [39] By email dated 14 December 2016 Mr Dixon stated, inter alia, the following: Had the option, management proposes in your most recent correspondence, been an option two months ago (when the quote/variation was accepted) I would have accepted management's decision, and we both could have parted our ways moved on. However, to put an unreasonable proposition i.e. unconditionally accept an approximate 50% increase 48 hours from delivery/installation or the contract will be terminated apart from being a breach of the accepted terms and conditions, your decision will cause financial hardship to myself and my client. [40] The parties did not resolve the differences and Mr Dixon had to obtain quotes and proceed with the installation at a much later date. Mr Dixon obtained quotes from three other cabinetmakers. He accepted the lowest quote of $19,300. He requested return of the deposit from Trend Kitchens as well as return of the sink, laundry tub and basin. Trend Kitchens have not returned any of those items nor has it refunded the deposit. [41] Included in Mr Dixon's claim is a claim for liquidated damages at a rate of $1,000 per day. I note in the contract with the cabinetmaker who, ultimately, undertook the work that there was an allowance for liquidated damages of $157 per day which actually exceeds $1,000 per week. The breach of contract by Trend Kitchens delayed completion of the construction of the 2 residences and their ultimate rental. Had a claim for loss of rental been claimed it would have exceeded the present claim. In my opinion, the rate for liquidated damages is reasonable. [42] Mr Dixon's claim is made up as follows: Reimburse the cost to purchase replacement sink, laundry tub and basin $654; Refund deposit $2,764.60 Difference between contract price $10,933.40 and subsequent cost $19,300.00 $8,306.60 Liquidated damages $1,000 per week for 8.3 weeks $9,114.00 Filing fee $315.70 Total $21,154.90 [43] I direct that Timber Trend Kitchens Pty Ltd pay Mr Neil Dixon the sum of $21,154.90 by 4.00 pm on 31 May 2018. -- 7 of 7 --