Chow v Sunstate Design & Construct Pty Ltd [2013] QCAT 616

CITATION: Chow v Sunstate Design & Construct Pty Ltd [2013] QCAT 616 PARTIES: Mr Jerald Chow (Applicant) v Sunstate Design & Construct Pty Ltd (Respondent) APPLICATION NUMBER: BDL084-13 MATTER TYPE: Building matters HEARING DATE: 11 November 2013 HEARD AT: Brisbane DECISION OF: Member Roney DELIVERED ON: 11 November 2013 DELIVERED AT: Brisbane ORDERS MADE: 1. I allow the Applicant’s claim as follows: (1) Reimbursement of monies paid under the contract $15,629.14 (2) Rectification costs $ 9,800.00 (3) Rental claim $ 6,000.00 (4) Filing fee $ 275.00 $31,704.14 2. I order the respondent to pay the applicant the sum of $31,704.14 within 3 months. CATCHWORDS: Building matters – Termination of contract – lawfulness thereof – damages APPEARANCES and REPRESENTATION (if any): APPLICANT: Mr Jerald Chow appeared in person RESPONDENT: Sunstate Design & Construct Pty Ltd represented by Ric Chan -- 1 of 4 -- 2 REASONS FOR DECISION [1] This is a dispute about the demolition of an existing deck and the construction of a new one to an unoccupied dwelling at Saunders Street, Indooroopilly. There is a contract in existence between the parties, the applicant and the respondent, dated 31 July 20131 for an agreed fixed price of $43,499.00. [2] The contract type is a home brand Sunstate Design & Construct contract with some 20 pages of conditions, nowhere is the term “design” and “construct” defined. It includes a payment schedule, it includes specification, sketch plan and some generic computer generated drawings. These drawings, on the evidence, which I accept, did not provide sufficient detail or specification for construction; they contemplated further drawings being prepared which met the applicant’s requirements. There appears on the evidence before me to be general consensus that this was the case, that at some future time the parties would be forced to come together again to agree on some greater detail. The further agreement which should have taken place, I find it was the builder’s obligation to obtain, but he did not so obtain on the evidence which I accept. [3] The question for the Tribunal’s determination today is whether the contract termination by the applicant was lawful. The applicant purported to do this by letter dated 30 November 2012. [4] Today has been a hearing, the time for mediation or further discussion is long past. This is a regretful situation however the Tribunal’s function today is to make a determination. In relation to the question of whether the termination by the applicant was correct, in summary I find that it was. I find that the builder, the respondent, by his conduct had repudiated the contract in the following respects: 1. Failing to provide plans or specifications which were capable of forming working documents for the purpose of construction, until after that construction had commenced. 2. Failing to provide working documents which were reasonably consistent with the drawings and specifications identified as part of the contract documents on 31 July 2012. 3. Failing to build in a manner reasonably consistent with those existing contract documents as at 31 July 2012. 4. Failing to install a lysaght metal flooring system as that was the system as represented by the contract that the builder would provide. 5. Failing to obtain Council approval for a plan to be constructed in accordance with the contract. 6. Obtaining Council approval for a plan, which the builder accepted in evidence, that he was not intending to build. 1 Exhibit 1 in the proceedings. -- 2 of 4 -- 3 7. Making demand for payment of the second stage payment, the statutory approval payment, when that stage had not been completed in that the plans submitted to Council for approval and in fact approved were not the plans the structure was to be built in accordance with. [5] I find that the applicant was entitled to accept that repudiation which I find he did by his letter of termination dated 30 November 2012. [6] I find that the applicant lawfully terminated the contract and that he is entitled to damages for breach of contract. [7] I accept the evidence of Mr Leonard for the applicant that what is in existence at the site has not been constructed in accordance with the working drawings, is defective, of no use and, should be demolished. [8] I find that the documents provided by Fast Track to obtain Council approval did not represent what the homeowner applicant had agreed upon and were generic documents produced by that firm that did not make adequate reference to the home owners requirements. The origin of the problem in this dispute has been the builder’s failure to provide proper engineering documents at the time of execution of the contract. [9] Specifically I reject the evidence or Mr Kosch and Mr Chan that: a) the applicant knew he was not going to get a structure built in accordance with the plan; b) that the applicant knew that he was not going to get a lysaght flooring system although mention of that product is referenced in the contract documents by 31 July 2013 and the further design documents of 8 August 2013; c) that the applicant authorised the construction of the structure that has been built on his property; and d) that the structure as erected is sound from an engineering point, as neither party is qualified to give that evidence. [10] I find the respondent is in breach of contract and has no entitlement to be paid at all but in any event, I find that the value of the work performed is nil. [11] By way of damages the applicant seeks reimbursement of monies paid less demolition fees. The applicant seeks an amount calculated as $17,129.41 less $1,500.00, a sub total of $15,629.14. -- 3 of 4 -- 4 [12] I allow that amount to the applicant. The applicant also seeks an amount of $9,800.00 being: $ 600.00 for gas repairs; $4,000.00 for replacement of stirrup post anchors; $3,200.00 for replacement of columns; and $2,000.00 for the restoration of gutters. [13] This brings a total of $9,800.00. I likewise allow that amount to the applicant. [14] The applicant further brings a claim for damages based upon his inability to occupy the premises for a period of 10 months from January this year at a rate of $2,000.00. [15] In relation to the claim for rental premises, it seems to my mind that there has been some delay in prosecuting this matter to get to this point today. While I do not say that it is the applicant’s fault, I do not know that the respondent should be entirely responsible for that. Some delay, I expect, is occasioned through the procedure of making application at QCAT and moving through the normal protocols of the Tribunal. It seems likely on balance that the additional cost occasioned to the applicants has been by reason of the delay in the construction being finalised and the advice that they were given about not proceeding with another contract. However, in fairness, what I am going to allow to the applicants is an amount commensurate with 3 months rental, an amount which I calculate at $6,000.00 in addition to the other claims I’ve allowed. I further allow to them the filing fee at the Tribunal which they seek of $275.00. [16] As I say I have taken the unusual step of ex tempore reasons in this matter because I think there is some urgency to it having regard to the state the house is in and as we move almost into a Christmas period where there will be very little opportunity for anything to be done. [17] In summary I allow the Applicant’s claim as follows: (1) Reimbursement of monies paid under the contract $15,629.14 (2) Rectification costs $ 9,800.00 (3) Rental claim $ 6,000.00 (4) Filing fee $ 275.00 $31,704.14 [18] I order the respondent to pay the applicant the sum of $31,704.14 within 3 months. -- 4 of 4 --