Armstrong v Plumbing Industry Council [2013] QCAT 223

CITATION: Armstrong v Plumbing Industry Council [2013] QCAT 223 PARTIES: Gary Armstrong (Applicant) v Plumbing Industry Council (Respondent) APPLICATION NUMBER: OCR383-12 MATTER TYPE: Occupational regulation matters HEARING DATE: 26 March 2013 HEARD AT: Brisbane DECISION OF: R F King-Scott, Member DELIVERED ON: 10 May 2013 DELIVERED AT: Brisbane ORDERS MADE: 1. Conditions 1 (a) and (b) of the Stay Decision of 20 December 2012 be lifted and that the Applicant’s endorsement to install Heat Pump and Solar Hot Water Systems be reinstated. 2. The fine of $6,600.00 be set aside and in lieu thereof the Applicant is fined $3,300.00, such fine to be paid by 31 July 2013. 3. The Applicant rectify [subject to the owners’ consent] all non-compliant work relating to the properties listed in the Attachment to the Show Cause Notice dated 20 August 2012 and any outstanding work in the Gold Coast City Council, Ipswich City Council, and Redlands City Council jurisdiction to the satisfaction of the relevant local government and the Respondent by 31 October 2013. 4. The Applicant lodge with the Respondent a duplicate copy of every Plumbing and Drainage Act 2002 Form 4 he is required to lodge with a local government for a period of 12 months ending 30 April 2014. 5. Should the Applicant not pay the fine by 31 -- 1 of 11 -- 2 July 2013 or not complete the rectification work by 31 October 2013, then his licence will be suspended for a period of 12 months commencing upon the day following the day of default. CATCHWORDS: Occupational Regulation – Disciplinary Proceedings – requirements of Show Cause Notice - particulars of the offences charged – identification of the facts and circumstances relied upon. APPEARANCES and REPRESENTATION (if any): APPLICANT: In person. RESPONDENT: Chris Harris, Registrar, Plumbing Industry Council. REASONS FOR DECISION [1] Gary John Armstrong is a licensed Plumber. He carries on his trade under the business name PBV Pty Ltd. [2] He entered into a contractual arrangement with a company Modern Group Pty Ltd which traded under the name of Modern Solar as their solar hot water system installer. [3] In 2010/11, the Queensland Government had implemented a Solar Hot Water Rebate Program which Modern Solar took advantage of. [4] In 2010/11, the Respondent, Plumbing Industry Council, carried out an audit of all installations under the program. It found some 700 cases of non-compliance. Mr Armstrong was one of those cases. He was fined $3,000. In essence, Mr Armstrong’s offence was that as he did not at the time of the installations hold an endorsement on his licence for the installation of solar and heat pump hot water systems, he was required to obtain a permit from the local authority [Form 1] before undertaking the regulated plumbing work. A further requirement was that on completion of the work, Mr Armstrong was required to request the local authority to assess the work within 7 days of completion. He failed to lodge a Form 1 or to arrange an inspection. There were 13 installations located principally in the Moreton Bay Regional Council Authority [MBRC] and one in the Brisbane City Council Authority. He sought a review of the decision which was dismissed on 26 March 2012. An application for leave to appeal that decision has been filed. These matters are not subject to this review and are mentioned because Mr Armstrong alleges there has been -- 2 of 11 -- 3 some duplication relating to non-compliance matters in relation to some properties. [5] On 14 October 2011, a Mr Arnold Andrew of Middle Park lodged a complaint with the PIC in respect of Mr Armstrong’s installation of his solar hot water system. These proceedings arise from the PIC’s investigation of that complaint and subsequent investigation of Mr Armstrong’s other installations completed on behalf of Modern Solar. [6] The PIC found there were 128 installations that contravened the Plumbing and Drainage Act 2002 [PDA]. A Show Cause Notice and Disciplinary Order that followed does not particularise the offences in detail, although Mr Armstrong was afforded a hearing. Under the Disciplinary Order dated 20 November 2012 Mr Armstrong’s licence was suspended for 12 months and he was fined 60 penalty points or $6,600. This was the maximum penalty the PIC could impose under Section 65(1)(c) of the PDA. [7] Mr Armstrong seeks review of that decision and the penalty imposed. His suspension has been stayed, subject to conditions, pending the outcome of this review. The Show Cause Notice [8] The PDA provides the mechanism by which the PIC should proceed against one of its licensees, if it believes that grounds exist for taking disciplinary action. [9] Once it decides to embark upon a disciplinary action, the PIC must give a Notice [called a Show Cause Notice] to the licensee. That Notice must:  state the ground for proposing to act under s 55(1) of the PDA;  outline the facts and circumstances forming the basis for the ground; and  invite the licensee to show within a stated period why action should not be taken. [10] It is axiomatic that in outlining the facts and circumstances forming the basis of a ground, the PIC must provide sufficient detail for the licensee to understand the nature of the allegations made against him so that he/she is able to make a relevant and informed response to the allegations. [11] The Show Cause Notice dated 20 August 20121 served on Mr Armstrong stated, inter alia: The Plumbing Industry Council [PIC] recently considered a Disciplinary Report2 regarding a complaint received about defective 1 Exhibit 16 is in similar terms to an earlier Show Cause Notice dated 21 May 2012 which is Attachment A in the Statement of Reasons, Exhibit 7. There are references to other Show Cause Notices of different dates in the material provided to the Tribunal. 2 The Disciplinary Report is not in evidence unless it is meant to describe the material forming part of the Statement of Reasons, Exhibit 7. -- 3 of 11 -- 4 and non-compliant plumbing work performed at various locations across Sunshine Coast Regional Council [SCRS], Moreton Bay Regional Council [MBRC], Brisbane City Council [BCC], Gold Coast City Council [GCCC], Ipswich City Council [ICC] and Redlands City Council [RCC] areas. A list of addresses at which defective and non- compliant plumbing works were allegedly performed is attached. [12] A list of 120 residences in the various local authorities was attached. The list did not identify the nature of the defective work but included in addition to the installation and completion dates a reference as to whether the installation had been inspected by the Local Government and whether forms had been submitted. In each case, the answer was in the negative. [13] So far as the list is concerned, it could only be interpreted as a list of non- compliant work not defective work. [14] The Show Cause Notice went on to state: The PIC has now considered this matter and has identified the following concerns during the course of the PIC’s investigation.  Multiple allegations that you performed defective plumbing work during the installation of solar hot water heaters not in accordance with the Australian Standard.  The installation of solar water heaters were performed without permits and no inspections were called as mandated in the Plumbing & Drainage Act 2002 [PBA].  An allegation that the regulation plumbing work did not comply with the Standard Plumbing & Drainage Regulation 2003 [SPDR] was performed by you, Mr Gary Armstrong. [15] No further details were given in the Notice to particularise the “multiple allegations” or specific allegation that regulated plumbing work did not comply with the SPDR. [16] Mr Armstrong’s response to the Show Cause Notice was in essence:  he denied he had performed defective plumbing work and stated that all work had been carried out in a tradesman-like manner;  that the installations were performed by him under the assumption that Modern Solar had completed the relevant forms and had booked the final inspections;  in respect of the specific allegation which he believed related to the wrong specification of lagging, Mr Armstrong relied upon the oral advice he received from the Brisbane City Council Plumbing Service Department which advice turned out to be erroneous. Review Process -- 4 of 11 -- 5 [17] Section 20 of the Queensland Civil and Administrative Tribunal Act 2009 provides that a Tribunal must hear and decide a review of a reviewable decision by way of fresh hearing on the merits with the purpose of producing the correct and preferable decision. [18] The decision-maker is obligated to assist the Tribunal in making a decision. The PIC has provided a detailed Statement of Reasons comprising a bound book containing, inter alia, the evidence in support of the PIC’s decision. Evidence [19] Annexure C comprised an assortment of defective notices issued by various local government authorities in relation to installations carried out by Mr Armstrong. A common defect recorded in respect of all of the installations was that the incorrect lagging was used on the flow and return pipe, the lagging used was fire resistant and should have been UV resistant. Another common complaint was the temperature had not been correctly set at less than 50 degrees Centigrade. [20] In addition, the PIC took account of the following further defects:  water connections were not clipped in accordance with the appropriate Australian Standards;  insulation of hot water piping was not in accordance with the appropriate Australian Standards;  discharge points for the temperature, pressure valve and relief valves did not comply with the appropriate Australian Standards;  hot water heaters were not supported correctly and did not comply with appropriate Australian Standards;  no tempering valves were installed, resulting in temperatures above 50 degrees and therefore the installation failed to meet the requirements of the appropriate Australian Standards. [21] As recorded earlier, Mr Armstrong’s explanation for the use of incorrect lagging was based on what he had been told by someone in the Brisbane City Council Plumbing Department. As a licensed Plumber, the responsibility for the installation and the correct use of lagging was his. As such matters are the subject of an Australian Standard, AS/NZS 3500.4, section 8.2, it is a matter he should have been aware of. He cannot rely upon some erroneous advice given by a local government, plumbing department. [22] Of the 128 installations for which Mr Armstrong had not submitted a Form 1, 112 had been issued with Defect Notices by the local government. It is alleged that Mr Armstrong has failed to address these defects or call for reinspection. Some of the installations were described as dangerous or potentially dangerous. They (7) were all within the Moreton Bay Regional Council [MBRC] and have been rectified by Mr Armstrong and reinspected -- 5 of 11 -- 6 and are now considered compliant. I should interpolate here that Mr Armstrong asserted that the seriousness of the danger had been overstated and there is no evidence before the Tribunal that identifies these installations. Analysis of the Complaints [23] The most serious complaint made against Mr Armstrong appears to be the installation he carried out for a Mr Arnold Andrew at Middle Park (the Middle Park premises). [24] The deficiencies in the installation became apparent as a result of water penetration through the ceiling around the light fittings. Macrossan Plumbing and Gasfitting were called to investigate and repair same. They found that polythene piping had been melted by copper flow and return lines from the solar panels on the roof. It was alleged that the copper lines had not been lagged. Mr Macrossan, it is alleged, suffered burns to his forearm and legs when his limbs came into contact with the lines. [No further detail is provided as to the seriousness of these injuries]. Mr Macrossan, it is said, was very distressed and upset when the electrical safety switch was engaged, allegedly because uninsulated copper piping came into contact with electrical wires. There are photos of the damaged piping and the position of the electrical cabling. [25] Mr Armstrong concedes that the copper piping was not insulated as it should have been. However, he maintains that the pipework was clear of electrical cabling when he completed the work which he says was about three years earlier. In fact, the work appears to have been completed on 1 November 20093, and the damage occurred around 9 October 20114. [26] The photos in the Attachment clearly show that the copper pipes are in direct contact with electrical cabling. It is difficult to accept Mr Armstrong’s insinuation that they may have been moved by others. [27] The failure to properly insulate the copper flow and return lines was a serious oversight. Hot water flowing from a solar hot water system reaches very high temperatures, way above hot water generated by conventional electrical or gas systems. Temperatures for solar hot water systems can exceed 100 degrees Centigrade. The photographic evidence clearly shows that polythene water pipes were melted through by contact with the copper hot water pipe. AS/NZS 3500 requires water connections to be clipped and hot water pipes to be insulated. Interestingly, the Tribunal was informed that this was not because of the problem that arose here, that is of melting of insulation of other water pipes or cables, but for the purpose of conserving heat. [28] The incident manifests a serious case of defective and non-compliant workmanship by Mr Armstrong. 3 See Show Cause Notice and attached list of addresses. 4 See Attachment H Exhibit 7. -- 6 of 11 -- 7 [29] The Statement of Reasons, Exhibit 7, p.2, set out further complaints of defective workmanship by Mr Armstrong. They were:  water connections are not clipped in accordance with AS/NZS 3500.4.4.5  insulation of hot water piping is not in accordance with AS/NZS 3500.4 section 8.2  discharge points for the TPR and relief valve do not comply with AS/NZS 3500 4.4.12.3  hot water heater is not supported correctly and does not comply with AS/NZS 3500 4.5.5.3  no tempering valve installed resulting in temperatures above 50 degrees and therefore failing to meet the requirements of AS/NZS 3500.4 [30] The material the PIC presumably relied upon in considering these defects and non-compliance issues comprised the numerous [17] investigation reports from the Brisbane City Council and the 71 documents from the MBRC, all of which form part of Attachment H to the Statement of Reasons. Of the 17 Brisbane City Council investigation reports, 2 were related to properties where no inspection was carried out and one was a duplicated document. [31] The material from the MBRC comprised defect notifications, letters of non- compliance and emails. [32] There are no documents from Gold Coast City Council, Ipswich City Council, and Redlands City Council, although the PIC says defect notices (24) have been forwarded to the affected properties but no inspections have been carried out. [33] Some notices were accompanied by photographs evidencing the defects. Potentially the most dangerous defects were those where electric cabling came into contact with uninsulated copper piping. In the MBRC defect notifications, there were five instances of this occurring, but only one was supported by photographs. In respect of that particular matter5, Mr Armstrong pointed out during the hearing that the cabling in that photograph was not an electrical cable but what he described as a signal cable and one that would have created no particular danger. The Respondent appeared to agree with this assertion. [34] Attachment H contained photographs of allegedly defective workmanship including Mr Andrews’ property at Middle Park, however one of the properties described in the photographs is not the subject of a notification given by the local authority. I am unaware of why it has been included. 5 See Final Inspection Report Number A11806, Mary Street West, Mango Hill. -- 7 of 11 -- 8 [35] It is difficult to determine what material the PIC had before it when it was considering the charges against Mr Armstrong; it is not known what charges it considered or proved and therefore what charges were taken into account when it imposed the penalty it did. [36] In this respect, it is the Tribunal’s finding that:  the PIC has failed to provide Mr Armstrong with a clear and concise Statement of Grounds upon which it was intended to take disciplinary action against him;  the PIC has taken account of other matters that it did not include in the Show Cause Notice. It is not clear whether Mr Armstrong was given a proper opportunity of addressing these charges;  the evidence relied upon as a basis for taking disciplinary action is extensive and confusing;  it is not clear from the material what offences Mr Armstrong has been disciplined for. [37] Of the defects mentioned in the Statement of Reasons that I have referred to above, the most common non-compliance issue was the failure to insulate the hot water lines. As I noted above, the requirement to insulate them is for the conservation of energy rather than to protect persons or property from being damaged by the heat that is emitted from the hot water lines, however, as has been demonstrated the potential effect of extremely hot pipes coming into electrical cabling can be catastrophic. [38] The next most common complaint was that the temperature of the hot water in many instances exceeded 50 degrees Centigrade, which I understand is the mandated maximum temperature. There are good reasons for this, essentially to prevent scalding injuries to infants and the elderly. [39] The Tribunal heard evidence that the tempering valves are rarely preset by the manufacturers and it is the installer’s responsibility to check the temperature. Mr Armstrong maintained that some home owners remove or modify the tempering valves and that he was not responsible. He then made the surprising comment that he did not commission the hot water heaters after he had installed them. It was clear from his evidence that he did not check the temperature. [40] The PIC says that this is an important safety issue that concerns the Council and others in the community. Anecdotal evidence was provided of serious injuries and death caused through scalding incidents arising from excessively hot water. [41] The notification of defects documents also make reference to other incidents of defective workmanship, including the incorrect placement of heaters and drainage outlets. These are not as significant as the safety issues referred to above. -- 8 of 11 -- 9 [42] Mr Armstrong concedes that he is guilty of some instances of defective workmanship and guilty of non-compliance with the requirements to file the appropriate forms with the local authority. [43] Mr Armstrong maintains that the deficiencies in his workmanship have been blown out of all proportion and the safety issues have been exaggerated. There seems to be some truth to this in that, although there are several references to electrical cabling coming into contact with uninsulated hot water pipes, there is little photographic evidence of this and in respect of the one instance where there is a photograph, the electrical cabling turns out not be electrical but rather signal cabling. [44] In respect of the failure to lodge the correct forms with the local government and the failure to seek inspections on completion of the work, all of those failures arise from a common, if erroneous, misconception that Modern Solar was responsible for such paperwork. I accept that the failure can lead to serious consequences because essentially the work, which is regulated plumbing work, goes uninspected and unchecked. Nevertheless, although the multiplicity of non-compliance issues is a factor to be taken into account in imposing the penalty, the common error relating to all non-compliance should be borne in mind. This is particularly so as Mr Armstrong was dealt with by the PIC for similar offences in 2011 that were subject to a QCAT review on 26 March 2012. It appears that the PIC was not aware of the offences the subject of this review when he was dealt with for the earlier offences. Had it been so aware, Mr Armstrong could have had them all dealt with together. [45] In reviewing a reviewable decision, the Tribunal, under s 24 of the QCAT Act may: (a) confirm or amend a decision; or (b) set aside the decision and substitute its own decision; or (c) set aside the decision and return the matter for reconsideration to the decision-maker for a decision with the directions the Tribunal considers appropriate. [46] As Mr Armstrong has admitted some of the offences, the Tribunal does not see any advantage in referring the matter back to the PIC for reconsideration. [47] The Tribunal proposed to set aside the PIC’s decision and substitute its own decision. [48] Mr Armstrong has admitted his responsibility for the incident involving the Middle Park premises. The Tribunal accepts that property damage occurred to the Middle Park property and that Mr Macrossan suffered personal injury when he was called to make repairs. The nature and extent of his injuries is unknown. The Tribunal appreciates the potential serious consequences that could have flowed from Mr Armstrong’s poor workmanship and failure to comply with the appropriate standards. -- 9 of 11 -- 10 [49] The Tribunal further accepts that Mr Armstrong failed to obtain the requisite compliance [by lodgement of Form 1] with the local government for 128 installations. The Tribunal also finds that when inspected, many of those installations were non-compliant. It finds that the non-compliance in many instances involved common error; either the use of incorrect lagging, the failure to insulate outflow lines, the failure to check hot water temperature and in some cases, the incorrect placement of heaters and/or discharge points. [50] The PIC asserts that Mr Armstrong did not request, from the local governments concerned, plumbing inspections of the defective installations as required under the Form 1 compliance assessment process. Mr Armstrong disputes this and states that he made every attempt to have the inspections carried out, although some still remain outstanding. The Tribunal is unable to determine from all of the material whether this is so. [51] The PIC, and in this instance the Tribunal [standing in the shoes of the PIC], has authority under s.65(1) of the PBA to order the work to be rectified. To facilitate this, the Tribunal proposes to order that the PIC identify each and every installation that remains non-compliant and to provide that list to Mr Armstrong. Mr Armstrong is then to carry out the rectification work [where the owner consents] to the satisfaction of the local government responsible and the PIC. [52] In addition, the Tribunal imposes a fine of $3,300. Mr Armstrong has already been fined that amount for his earlier offence. As stated earlier the fine imposed by the PIC in respect of the matter under review with a 12 months suspension was in effect the maximum penalty that could be imposed by the PIC without referring the matter to QCAT. In imposing the fine, the Tribunal has taken into consideration that the non-compliant installations, the subject of this review, are an extension of the offences that Mr Armstrong was dealt with for in 2011 and reviewed by QCAT in 2012, for which he was fined $3,300. Had all the offences been dealt with at that time, he may have received a higher fine, particularly with the aggravating factor involving the Middle Park premises. Fortunately for Mr Armstrong, the facts relating to Mr Macrossan’s injuries are unclear, although the potential for serious injury and death was certainly present. [53] On 20 December 2012 Senior Member O’Callaghan stayed the decision made by the PIC pending further order of the Tribunal subject to conditions. Those conditions were:- (a) Mr Armitage not install hot water systems and any endorsements on his licence to permit him to do so was to be removed; (b) the only work Mr Armitage may carry out was work associated with installation and servicing of home sewerage treatment plants; (c) Mr Armitage to provide a list of all hot water systems that he had installed either as principal contractor or as a sub-contractor except those installed as a sub-contractor for the Modern Group. -- 10 of 11 -- 11 [54] I was informed at the hearing that the last condition has been complied with. [55] The Tribunal is of the view that the prohibition against Mr Armitage installing hot water systems can be lifted. He is well aware of the deficiencies of his previous installations, and is unlikely to reoffend further although all work conducted by him should be inspected by the relevant Local Government inspector. With a Heat Pump and Solar Hot Water Endorsement on his licence Mr Armstrong would only be required to lodge a Form 4 with the relevant Local Government but no inspection would be carried out. The Tribunal thinks it is essential that there be a probation period when Mr Armitage’s work is inspected. The Tribunal proposes a period of 12 months. To allow this to be administered the Tribunal proposes that Mr Armstrong serve the PIC with a duplicate copy of each PDA Form 4 he is required to lodge. The PIC can audit his work at its discretion. [56] The Tribunal orders that: 1. Conditions 1 (a) and (b) of the Stay Decision of 20 December 2012 be lifted and that the Applicant’s endorsement to install Heat Pump and Solar Hot Water Systems be reinstated. 2. The fine of $6,600.00 be set aside and in lieu thereof the Applicant is fined $3,300.00, such fine to be paid by 31 July 2013. 3. The Applicant rectify [subject to the owners’ consent] all non- compliant work relating to the properties listed in the Attachment to the Show Cause Notice dated 20 August 2012 and any outstanding work in the Gold Coast City Council, Ipswich City Council, and Redlands City Council jurisdiction to the satisfaction of the relevant local government and the Respondent by 31 October 2013. 4. The Applicant lodge with the Respondent a duplicate copy of every Plumbing and Drainage Act 2002 Form 4 he is required to lodge with a local government for a period of 12 months ending 30 April 2014. 5. Should the Applicant not pay the fine by 31 July 2013 or not complete the rectification work by 31 October 2013, then his licence will be suspended for a period of 12 months commencing upon the day following the day of default. -- 11 of 11 --