Brown v Noosa Constructions Pty Ltd [2012] QCATA 194

CITATION: Brown and Anor v Noosa Constructions Pty Ltd [2012] QCATA 194 PARTIES: Deborah Brown Christopher Brown (Appellants) v Noosa Constructions Pty Ltd (Respondent) APPLICATION NUMBER: APL035–12 MATTER TYPE: Appeals HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Justice Alan Wilson, President Aaron Suthers, Member DELIVERED ON: 9 October 2012 DELIVERED AT: ORDERS MADE: Brisbane 1. The appeal is allowed, but only to the following extent: a. The Order of the Tribunal dated 3 February 2012 numbered 1 is amended by reducing the amount to be distributed to Noosa Constructions Pty Ltd by the sum of $957.00, and increasing the amount to be distributed to Deborah Brown and Christopher Brown by the sum of $957.00; b. In the event that the funds referred to in that Order have been distributed to the parties by the Queensland Master Builders Association, then Noosa Constructions shall pay to Deborah Brown and Christopher Brown the sum of $957.00 within 21 days of this Order. 2. The application by Deborah Brown and Christopher Brown for their costs of the Appeal is dismissed. -- 1 of 21 -- 2 CATCHWORDS: CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – PERFORMANCE OF WORK – where Appellant brought a claim for rectification and determination of variations – where Tribunal ordered rectification and determined the parties‟ rights to a retention in the Queensland Master Builders Association trust account – where Tribunal failed to expose a basis for the decision – where most matters determined on appeal – whether remaining alleged errors of fact substantial – whether rehearing warranted Domestic Building Contracts Act 2000, s 79, 84 Queensland Building Services Authority Act 1991, s 77 Queensland Civil and Administrative Tribunal Act 2009, ss, 4, 28, 91, 43, 121, 142 Queensland Civil and Administrative Tribunal Rules 2009, r 85 Adamson v Queensland Law Society Incorporated [1990] 1 Qd R 498, cited Akins v National Australia Bank (1994) 34 NSWLR 155, cited Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175, cited Attorney-General v Kehoe [2000] QCA 222, cited Black, G v Toowoomba Resort Pty Ltd [2007] QCCTB 122, cited Cachia v Grech [2009] NSWCA 232, cited Chapman & Ors V Allan & Draper [1999] SASC 460, cited Fox v Percy [2003] HCA 22 Glenwood Properties Pty Ltd v Delmoss Pty Ltd [1986] 2 Qd R 388, cited Hawkins v Pender Bros Pty Ltd [1990] 1 Qd R 135, cited Jimenez v Sternlight Investments t/a LJ Hooker Alexandra Hills [2010] QCATA 29, cited Jones v Dunkel [1959] 101 CLR 298, cited Latoudis v Casey (1990) 170 CLR 534, cited Lida Build Pty Ltd v Miller and Anor [2011] QCATA 219, cited Lyons v Dreamstarter Pty Ltd [2011] QCATA 142, cited McIver Bulk Liquid Haulage Pty Ltd v Fruehauf Australia Pty Ltd [1989] 2 Qd R 577, cited -- 2 of 21 -- 3 Shillingsworth v Murray (2005) 2 DDCR 450; [2004] NSWCA 465, cited Thomas v State of Western Australia [2012] WASCA 22, cited Tully v McIntyre [2001] 2 Qd R 338, cited Underwood v Queensland Department of Communities (Queensland) [2012] QCA 158 APPEARANCES and REPRESENTATION: This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 („QCAT Act‟). REASONS FOR DECISION Justice Alan Wilson, President [1] I have had the advantage of reading the reasons of Mr Suthers in draft. I agree with them, and with the conclusions he has reached and the orders he proposes Aaron Suthers, Member [2] Ms Brown and her brother Mr Brown contracted with Noosa Constructions on 1 August 2010 to have it erect a kit home, supplied by a third party, for them on Fraser Island. [3] Disputes arose between the parties in the course of completion of that contract. Eventually the Browns commenced proceedings in the Tribunal seeking rectification of various items they said were outstanding or defective and for determination by the Tribunal of the amount still owing to Noosa Constructions. [4] Noosa Constructions filed a Response and counter application seeking payment of the balance of monies it said was outstanding under the contract. [5] The matter was determined by the Tribunal on 3 February 2012. Mr Brown was unable to attend the hearing and Ms Brown represented his interests. It was Ms Brown who had been primarily responsible for negotiating with Noosa Constructions throughout the project. In short the learned Member ordered that Noosa Constructions rectify some of the defects complained of, being all of the defects accepted as such by a Queensland Building Services Authority inspector, and made orders requiring payment of an adjusted amount to Noosa Constructions. From that decision the Browns seek to appeal, and as part of that appeal seek their costs. Both parties have provided written submissions in support of their respective positions. [6] Some of the Browns‟ complaints relate to a lack of a full comprehension, perhaps understandable, of the role of the Tribunal when determining -- 3 of 21 -- 4 issues between them and Noosa Constructions. They point out in the appeal, as they did in their material for the original hearing, many cases where they say Noosa Constructions breached their obligations under the Domestic Building Contracts Act 2000 and, in effect, seek to have a penalty applied. It was not the role of the Tribunal at first instance, nor is it the role of this Appeal Tribunal to determine those issues in the current proceedings. These proceedings are to determine the contractual issues between them and Noosa Constructions. [7] Where the Browns allege that the Tribunal has made an error of fact or an error of mixed fact and law, they require the Tribunal‟s leave before their appeal can proceed. It is only on an error of law that the Browns can proceed with their appeal without leave.1 [8] They raise a significant number of issues where they say there was appellable error. Of the issues directly raised by them, only two could be said to fall within the ambit of being an error of law. [9] The first of those grounds is that the learned Member allowed a “support person”, for Noosa Constructions to argue in support of the builder and that contributed to and influenced his decision. The Browns rely on an alleged breach of s 91 of the QCAT Act. As the Browns correctly point out in their appeal, s 91 relates to allowing support persons to assist parties at a private hearing. The hearing on 3 February 2012 was, in accordance with the Tribunal's practice, an open hearing. Section 91 has no application. [10] The transcript of the hearing shows, however, that the “support person” did nothing more than assist the Member in finding documents already filed in the Tribunal and give some other evidence. This does not equate to representing Noosa Constructions in the hearing, for which leave would have been required.2 There is nothing to suggest the Browns suffered any disadvantage, or detriment. [11] The Browns also complain, correctly as it would appear from the transcript, that the support person was not identified at the outset of the hearing. The person is referred to by name in the transcript, however, which strongly suggests that she identified herself prior to the commencement of the recording. The hearing was conducted on an informal basis by the learned Member. That was within his purview.3 No objection was raised by Ms Brown at the hearing to indicate that she did not know who the person was. Relevantly, a person of the same first name had been involved in correspondence with the Browns on behalf of Noosa Constructions during the course of the dispute. In those circumstances I am satisfied that this part of the complaint was in the nature of a makeweight, rather than a substantial cause for the appeal by the Browns. 1 Queensland Civil and Administrative Tribunal Act 2009, s 142(3)(b). 2 Queensland Civil and Administrative Tribunal Act 2009, s 43. 3 Queensland Civil and Administrative Tribunal Act 2009, ss 4 and 28. -- 4 of 21 -- 5 [12] The second alleged error of law complained of by the Browns concerns the learned Member admitting into evidence and considering a „without prejudice‟ document. [13] The Member referred4 to a letter of the 15 April 2011 headed “without prejudice”, filed in the proceedings by Noosa Constructions, from the Browns‟ solicitor to their own. In particular the Member used a spread sheet attached to that letter, prepared by or on behalf of the Browns, as a starting point for calculating any adjustments required to the contract price. [14] The well reported prohibition, traditionally applied by courts, to the admission of without prejudice documents is one of the evidentiary rules of which this Tribunal is relieved from strict compliance.5 Notwithstanding this, the Tribunal would consider a relaxation of the traditional approach as an exceptional step, given the importance of allowing people to suggest compromise on a confidential basis when seeking to avoid the need for judicial determination of their disputes. [15] Admission of the document should therefore be considered in context in order to see whether it breaches of the rules of natural justice to either party.6 [16] Importantly it was not the without prejudice letter itself, which clearly contained an offer of compromise, but the spread sheet attached to it that was referred to by the Member. The spread sheet was not, properly construed, part of the proposed compromise. It simply set out the Browns‟ thorough reconciliation of amounts which, they contended, remained owing pursuant to the contract. [17] In addition, to the extent that privilege may have attached to the spread sheet, the letter was filed by Noosa Constructions, apparently, to clarify a later letter in response from their solicitors dated 9 May 2011 headed “without prejudice save as to costs” which the Browns had filed with their application. [18] As no objection to the filing of either letter had been made, the learned Member was entitled to conclude that the parties had mutually agreed to waive the privilege which had attached to that course of correspondence.7 [19] No error has been shown in the Member‟s consideration of the spread sheet. [20] To the extent that the appeal relates to those matters of law it has no merit and should, in my view, be dismissed. 4 Transcript page 9, line 14. 5 Queensland Civil and Administrative Tribunal Act 2009, s 28(3)(b). 6 Queensland Civil and Administrative Tribunal Act 2009, s 28(3)(a). 7 Chapman & Ors V Allan & Draper [1999] SASC 460. -- 5 of 21 -- 6 [21] There are then a number of allegations of appellable error which relate to determinations of fact, or of mixed law and fact, by the learned Member. [22] Unfortunately, and despite the fact that the issue is not specifically raised by the Browns in their appeal, there are a number of issues raised at the hearing by the Browns and which they seek to agitate on appeal where there are no, or insufficient reasons given by the learned Member for the decisions he made. This is in itself, in the circumstances of this matter, an error of law.8 [23] The Tribunal is under a positive duty to give reasons for its decisions.9 Here, performance of the duty was necessary to enable the matter to be properly considered on appeal.10 When, as here, a factual dispute arises, it is necessary for the decision maker to explain choices between conflicting evidence.11 [24] It is appropriate, rather than dealing with all of the issues in turn, to give an example in which this issue arises. In relation to a claim by the Browns that they were overcharged for accommodation by Noosa Constructions (which will be dealt with more thoroughly later in these reasons) an exchange occurred between the learned Member and the representative of Noosa Constructions during which the Member asked the representative from Noosa Constructions whether he would be prepared to "split the difference" in the amount claimed by Noosa Constructions, which was disputed by the Browns. Whilst Noosa Constructions‟ representative agreed to do so, no response was sought or obtained from Ms Brown, and yet this median figure was then carried forward in the Member‟s calculations without any further reasons being given. [25] It appears, with respect, that the learned Member in making a proper attempt to assist the parties to resolve the matter between themselves may have lost sight of the need for reasons when an agreement could not, in the end, be reached. [26] This Appeal Tribunal, pursuant to s 146 of the QCAT Act, has the power where an error of law is demonstrated to: (a) confirm or amend the decision; or (b) set aside the decision and substitute its own decision; or (c) set aside the decision and return the matter to the tribunal or other entity who made the decision for reconsideration— (i) with or without the hearing of additional evidence as directed by the appeal tribunal; and (ii) with the other directions the appeal tribunal considers appropriate; or 8 Jimenez v Sternlight Investments t/a LJ Hooker Alexandra Hills [2010] QCATA 29. 9 Queensland Civil and Administrative Tribunal Act 2009, s 121(4). 10 Adamson v Queensland Law Society Incorporated [1990] 1 Qd R 498. 11 Shillingsworth v Murray (2005) 2 DDCR 450; [2004] NSWCA 465 at [37]-[38]. -- 6 of 21 -- 7 (d) make any other order it considers appropriate, whether or not in combination with an order made under paragraph (a), (b) or (c). [27] In my view, it is appropriate for the Appeal Tribunal to consider those matters complained of in the appeal, where the facts are clear but insufficient reasons were given, and substitute its own decision and reasons with an appropriate amendment to the learned Member‟s orders as required. [28] Not all of the matters raised in the appeal are the subject of insufficient reasons. In the interests of simplicity and finality for the parties though, all of the remaining matters raised in the appeal will be specifically dealt with hereunder. Where sufficient reasons were given I will consider whether an appeal is available as of right, or whether a grant of leave to appeal on that issue is appropriate or necessary. Compliance with the BAL – 29 fire requirements [29] This issue was sought to be raised by the Browns late in the proceedings. They filed an application on 23 January 2012 seeking to include this issue in the matters to be determined by the Tribunal. They sought to have Noosa Constructions “verify” that the building work done by it was bush fire compliant and in particular raised issues about the deck joists and lack of nylon bushes to a roller door. In the face of evidence filed by the Browns indicating that the building had been certified compliant, by order dated 24 January 2012 Senior Member Stilgoe dismissed the application to include this issue. [30] That decision has not been appealed. These issues were not addressed or determined by the learned Member at the hearing and there was no error in his approach. This ground of the Appeal has no merit. The Member accepted only the defects approved as such by the QBSA inspector, not all of those alleged by the Browns [31] The Browns provided to the Tribunal a list of 156 alleged defects in the building. The Tribunal obtained, from a Queensland Building Services Authority inspector, a report regarding each of the alleged defects. In relation to those alleged defects the inspector provided evidence to the Tribunal which, in summary, indicated that they fell within three broad categories. The first category were items of complaint that were, in his view, defective. The second category encompassed items complained of by the Browns and identified by the inspector, which he found were not defective or, to put it more clearly, were within acceptable industry standards. The third group of items were assessed as being contractual, that is, not relating to work which was allegedly defective, but work which was not allegedly performed in accordance with the contract. [32] The learned Member decided that he would only order rectification of those matters found to be defective by the QBSA inspector. His reasons, as they were explained to Ms Brown, were: "… you may well be right, but -- 7 of 21 -- 8 the problem you've got is that you don't have someone who has got building qualifications ---"12; and “you know, the problem you've got is you've got to have some evidence that what you say – I mean, just because you as a layperson don't like something doesn't mean it's defective work"13. [33] The Browns did not present any expert evidence to the Tribunal that the items complained of by them, but found not to be defective by the QBSA inspector, in fact fell below acceptable industry standard. The only independent evidence available to the learned Member as to the quality of the work was that of the inspector. The Member clearly accepted this evidence, based upon the independence and expertise of the inspector, in preference to the Browns' assertion that the work was defective. In the face of the evidence before him, the learned Member cannot be criticised for exercising his discretion in this way, and no error is apparent. [34] The learned Member gave Ms Brown a full opportunity at the hearing to canvass the issues considered to be contractual issues by the QBSA inspector. Where those issues have been raised in the appeal by the Browns they are dealt with below. The lack of zinc corrugated lining to the “pop out” floors [35] The Browns allege that Noosa Constructions failed to apply zinc corrugated lining to the underside of various pop out (cantilevered) sections of the building. In this regard Noosa Constructions presented uncontroverted evidence that no such zinc corrugated lining was supplied by the kit home supplier. The learned Member made no order in this regard. [36] Ms Brown raised the issue at the hearing that when the lack of materials for this work to be performed was noticed, Noosa Constructions could have advised her, so that the material could be provided and the work completed. This contention had much to commend it. Unfortunately, however, at the date of hearing and even in the appeal there was no suggestion that the Browns had sourced the relevant materials for the work to be performed.14 Clearly, Noosa Constructions may have obtained some advantage in not having to expend labour completing the work, but no evidence was submitted in this regard. In those circumstances it was within the discretion of the Member not to order that the work be completed. I would confirm the decision of the learned Member on this issue. The “rinse bay” [37] The original plans for the house provided for what was described as a rinse bay: a built item encompassing a shower with rose and tap and 12 Transcript page 91, line 15. 13 Transcript page 91, line 30. 14 Transcript page 105, line 14. -- 8 of 21 -- 9 timber screening as a surround. From the outset of the contract the construction of the rinse bay was excluded. The contract stipulated that the exclusion would be "rinse bay structural works." The Member considered a reply to an email from Noosa Constructions whereby Ms Brown accepted that “… this is the supply of pipe to the location only by the plumber.…” Ms Brown argued that they should still have been supplied with a freestanding shower rose and tap, perhaps attached to a star picket.15 What was in fact supplied was plumbing terminating at ground level. [38] The learned Member heard uncontroverted evidence from Noosa Constructions that plumbing approval would not have been given if Ms Brown‟s proposal has been followed.16 As the Member said to Ms Brown "… If you're going to put a pipe in, you need something to suspend it on, and if there is no structure, you---"17. It was implicit in this comment by the Member that he accepted that, having removed the rinse bay structural works, there was no appropriate way for Noosa Constructions to install a shower with a tap and rose. That decision was reasonably open to him, and provides no legitimate appeal ground. [39] For clarity, it is noted that the Browns in their appeal sought to introduce fresh evidence in the form of an email apparently from Mr Ashley Stackman, plumbing inspector for the Fraser Coast Regional Council. The email reads as follows: "Water supplied to a single outlet is not classed as a fixture. The tap is to fixed (sic) to a post and protected from damage." This evidence, even if it were accepted by the Appeal Tribunal, is far from clear and indicates that further work to install a post and protect the tap from damage would have been required. Presumably this would then have become the subject of another variation. Given the above I would not allow this evidence on appeal.18 Nothing contained in the document persuades me that its admission would lead to a different result. Robe shelving [40] The Browns complain that there was insufficient shelving to meet the contract specification constructed in each of the wardrobes in the house. The learned Member heard evidence about this issue from both parties and had access to the contract specifications. The evidence was that each of the wardrobes had a single shelf. The Browns argued for a construction of the contract which theorised that the word “shelves” as used in the contract must mean more than one shelf in each wardrobe. The actual words used in the contract are under the heading “Carpentry”. It provides for – “skirting, robe/s and linen shelves.” The Member decided that the wardrobes as constructed were within the terms of the contract. It is implicit that he accepted that the use of the word “shelves” as it was used in the contract contemplated one shelf in each robe. That 15 Transcript page 26 line 20. 16 Transcript page 26 line 36. 17 Transcript page 26 line 17. 18 Underwood v Queensland Department of Communities (Queensland) [2012] QCA 158. -- 9 of 21 -- 10 construction was reasonably open to him, and cannot be said to be erroneous. Site toilet [41] As part of the contract negotiations, Noosa Constructions indicated that they would use a hired site toilet. Apparently, no one was prepared to deliver one to the Fraser Island worksite. On that basis the Browns sought a reduction in the amount to be paid by them, to allow for this item. It was, in their view, included in the cost but not provided. Noosa Constructions‟ position was that due to the lack of a site toilet they incurred downtime for their workers to utilise the toilet at the unit provided by the Browns, and that effectively the two should balance out. The Tribunal allowed no reduction but the reasoning was not, with respect, clear. [42] The issue arises from a document headed “Noosa Constructions Pty Ltd estimate prices” prepared for this job before the contract was entered into. Noosa Constructions led evidence, consistent with that document, that no specific price was allowed and that their anticipated need to hire the site toilet formed part of their agreed lump-sum price for the job.19 I would accept that evidence, which was unchallenged, and confirm this aspect of the learned Member‟s decision. [43] Again, for the sake of clarity, it should be noted that the Browns sought on appeal a specific reduction in the amount recoverable by Noosa Constructions in the amount of $864.25. They seek to rely on a one page, partly typed, partly handwritten document by an unknown author indicating that this is the cost of hire of a "flagship" portable toilet for 95 days. This evidence was not before the learned Member, and given the nature of it I would not allow it as fresh evidence in the appeal.20 No lock on store/study door [44] The Browns complain in their appeal that there is no lock on their store/study door. Noosa Constructions agreed to install a lock to the door. It is implicit, although not helpfully explained in the appeal documents, that this was not completed as at the date of the appeal. In their response to the appeal Noosa Constructions indicated that the lock had been installed. The Browns then say that a deadbolt has been added, and say that they now have two separate mechanisms, which is unacceptable.21 Quoting directly, they say: Brown want a door as contract documents with one lock. NC were advised at construction that lock should be installed in the same position as all handle so Brown are able to replace the lock with a handle at a later stage if need be(sic) 19 Transcript page 83, line 25. 20 Underwood v Queensland Department of Communities (Queensland) [2012] QCA 158. 21 Letter to the Tribunal dated 20 April 2012. -- 10 of 21 -- 11 [45] To the extent that I am able to discern the basis of the Browns‟ complaint I am satisfied that an appropriate remedy has been completed. This ground of appeal has no merit. Variations for increased PC item cost and alleged errors in the figures calculated by the Member at the Hearing Sanitary items and Taps [46] The Browns allege that the documents evidencing the cost of these items were unclear. They say that some of the taps used do not match and that the shower rose fitted in one bathroom was not the one specified. Correspondence about this issue passed back and forth between the parties by email on 6 and 7 November 2010. The evidence before the learned Member at the hearing from Ms Brown in relation to one of the items on this point was, at its highest: Member ―How did you specify these things? Where did you specify them?‖ Ms Brown ―Well, I know the shower rose I was – said and gave the thing to Ian on the phone, because I had a piece of paper in front of me saying this is what we want the shower rose – because we were going to have all these different sorts, and I said, no, we’ve decided on this one, gave him the style, the everything, and then for the other---― Member "Well, I mean, I simply don't know how you expect me to make any decision on that. I mean, they're less than the allowance that was made, so you haven't been prejudiced by them charging you more. I take your point that you didn't get what you thought you were going to get, what you say you specified you were going to get, but I don't know how sitting here now we do anything about it.‖22 [47] I am satisfied, having read the email exchanges between the parties and after considering the transcript, that the Browns were advised and consulted about each of the relevant items which were installed. None of these items were specified in the contract and the total cost was less than the prime cost allowance. An adjustment was made in the Browns' favour in this regard. [48] Given the state of the evidence the learned Member declined to make an order in the Browns‟ favour. There was insufficient evidence to make a finding that Noosa Constructions did not comply with the terms of the contract or any subsequent contractual agreement with the Browns. The decision was within the Member‟s reasonable discretion, and has not been shown to involve any error. Miscalculation of the amount varied for door furniture 22 Transcript page 75, lines 19-40. -- 11 of 21 -- 12 [49] In their submissions on appeal the Browns complain that the learned Member made a miscalculation when explaining his reasons regarding amounts to be allowed after changes were made to the door furniture. They set out their calculations, which are not clearly explained, and reach the conclusion that they should have received a further allowance of $150.31. The calculations were completed by the learned Member at the hearing with input from both parties. The explanation given for the calculation is clear and, whilst the evidence upon which it was based is not, the allowance made by the learned Member was fully explained. [50] Any error made by the learned Member in this regard would be an error of fact for which leave to appeal would be required.23 Given that the sum disputed by the Browns in relation to this item is $150.31, it is not, in my view a question of importance upon which further argument in a decision of the Tribunal would be of public advantage.24 The Browns in their submissions on appeal repeatedly request that the matter be determined, as opposed no doubt to referring it for re-hearing. It is well established that finality in litigation is highly desirable because any further action beyond the hearing can be costly, and unnecessarily burdensome on the parties.25 On balance I am not satisfied that any error in relation to this issue, even if proven on re-hearing, would lead to the Browns obtaining relief that could, in all the circumstances, be properly described as substantive.26 I would refuse leave to appeal on this issue. Wall Variation [51] The substance of this complaint is best set out in the appeal itself. It is described as: Brown provided a document asking specific walls in the house to be confirmed (sic) prior to construction. Brown wasn't notified, NC constructed the wall and charged Brown to take it down when she confirmed it wasn't wanted. [52] In response Noosa Constructions say that the wall was clearly marked on the plans and the pre-nailed frame was supplied to site by the kit home supplier and installed as per plans. It says that it was only after this occurred that the Browns sought to have the wall removed. [53] In an email dated 13 October 2010 Noosa Constructions advised Ms Brown as follows "…alternatively we will price to change these for you to sign off these changes and the variation in price, as we currently hold previous signed drawings as per our current construction". They requested that proof of an earlier alleged request to change the plans be supplied. In response, by email dated 24 October Ms Brown advised "sketch provided by post with locations in question bubbled. (sic) Will 23 Queensland Civil and Administrative Tribunal Act 2009, s 142(3)(b). 24 Glenwood Properties Pty Ltd v Delmoss Pty Ltd [1986] 2 Qd R 388 at 389; McIver Bulk Liquid Haulage Pty Ltd v Fruehauf Australia Pty Ltd [1989] 2 Qd R 577 at 578, 580. 25 Fox v Percy [2003] HCA 22 at 29 per Gleeson CJ, Gummow and Kirby JJ. 26 Cachia v Grech [2009] NSWCA 232 at [13]. -- 12 of 21 -- 13 provide copy of sketch. Had sketch with me on our last site visit however we ran out of time to review variations.” [54] Noosa Constructions asked for proof the sketch had been provided prior to construction of the wall. No such proof has been filed by the Browns. The email of 24 October 2010 is unhelpful in relation to whether the Browns requested a change prior to construction of the wall. The work in accordance with this variation was undoubtedly performed at the request of the Browns, and there is no complaint about the quality of workmanship in its performance. However, this is not the end of the matter. Despite the above it remains the case that Noosa Constructions did not comply with its obligations under s 79(1) of the Domestic Building Contracts Act 2000 to put the variation into the appropriate written form before doing the work. [55] To recover for the variation it was required to show that it would suffer unreasonable hardship in complying with the strict operation of the Domestic Building Contracts Act 2000 in relation to the variation and it would not be unfair to the Browns for it to recover the amount.27 [56] There are a number of matters that the Appeal Tribunal may consider in relation to the issues of unreasonable hardship and fairness. [57] Firstly there was a significant geographic distance between the offices of Noosa Constructions, the Browns' residence and the jobsite. To overcome this Noosa Constructions kept in regular contact with Ms Brown by email. Many discussions about variations, including this one, were conducted in this manner. Many other variations were accepted by email. [58] The Browns were given the opportunity to consider whether to have the wall changed. It was originally constructed as per signed plans. The work was performed for a relatively modest cost ($140.00). [59] In Black, G v Toowoomba Resort Pty Ltd28, Member Lohrisch of the Tribunal that formerly sat on disputes of this kind considered s 84(4)(b) of the Domestic Building Contracts Act 2000 and stated: Where, as in this instance, there has been a specific instruction by the proprietor to carry out works at variance to the contract works, the works have been carried out and the proprietor had received the benefit of the works, a builder would, in normal circumstances, in my view, suffer unreasonable hardship by not being able to recover an amount for the works subject of the variation. Further, in such circumstances, it would not be unfair to the owner were the builder to so recover. Indeed, one rationale for part 7 and section 84 is that, in my view, it is not intended that the builder be penalized unfairly, and the owner unjustly enriched, the balance to be achieved between these matters being in the Tribunal's discretion. 27 Domestic Building Contracts Act 2000, s 84(4). 28 [2007] QCCTB 122. -- 13 of 21 -- 14 [60] Having performed the work at the Browns' request, I am satisfied that the hardship to Noosa Constructions would be unreasonable in the circumstances if the variation were not allowed and that it is not unfair to the Browns that it be allowed. I would confirm the learned Member‟s decision on this issue. Tile delivery to site [61] Tiles were included in the contract as a prime cost item. Usually, a choice would be made by the owner and their provision arranged by the builder. It is clear, however, that at some point in her agreement with Noosa Constructions, Ms Brown made direct arrangements for some of the tiles to be obtained from the suppliers and paid a deposit on them.29 [62] At the relevant time when the tiles were required, arrangements were made for the Browns to collect the tiles from their chosen supplier and deliver them to the site. Ms Brown says that when she attended her chosen supplier the tiles were not ready. Noosa Constructions then arranged for the tiles to be delivered to site by one of their employees and charged a fee of $350.00, in accordance with a written variation, to do so. [63] By email dated 10 November 2010 Ms Brown advised Noosa Constructions as follows: Ian advised me on site yesterday 9/11/10 that the tiles are required on site by 20 – 21/11/10 this is the first definitive date requested of us to have the tiles delivered to site and we agreed to that, there is no reason for Noosa Constructions to leave site (sic). [64] It should be borne in mind that the relevant tiles chosen by the Browns were located in Strathpine and that they were, of course, delivered to Fraser Island. It could not be said in these circumstances that the amount claimed was excessive. Noosa Constructions filed in the Tribunal a letter from the tile supplier indicating that the tiles were in fact ready to be collected by the Browns at the relevant time, but that they failed to do so. [65] The Browns say the Tribunal should not rely upon that letter, because it was obtained approximately a year after the relevant event. The process of obtaining evidence after an event and during the course of litigation is hardly unusual. The letter independently verifies the version of Noosa Constructions on this issue. [66] The Browns say that they were not given enough notice to deliver the tiles and they have not approved a variation for their delivery. [67] In my view, considering that email, an agreement was reached that it was the Browns' obligation to deliver the tiles to site. Had the tiles not been made available it is highly likely that other expense would have been incurred, particularly where tilers had been booked to travel to an island location to lay them. Once allowance for the tile delivery was made, the 29 Email 19 September 2010. -- 14 of 21 -- 15 total cost for tiles was still below the prime cost allowance made in the contract. Even if one accepts that the Browns lost the ability to save the cost of delivery by doing it themselves, the Browns cannot have this issue both ways. Either they were to deliver the tiles (at some personal expense) and failed to do so at the appropriate time on ten days notice, or they were not responsible for delivery and the builder should be allowed a reasonable cost of getting the tiles chosen by the Browns to site, particularly where the total cost did not exceed the prime cost allowed. Accepting the rationale outlined in the quotation from Black, G v Toowoomba Resort Pty Ltd30 above, allowance of this claim was within the learned Member‟s reasonable discretion and I would confirm it on appeal. Extra accommodation for Noosa Constructions during construction [68] It was not in dispute that the Browns would provide accommodation for Noosa Constructions workers on site during the course of construction. Their intent was that this be done in a unit they provided. Two claims were made by Noosa Constructions for extra accommodation. The first was when tilers attended the island and the unit was full. During the course of the hearing Ms Brown accepted this amount.31 [69] Notwithstanding this acknowledgment, the Browns again seek to agitate this issue in the appeal. There is no persuasive reason for this Appeal Tribunal to allow them to do so. It cannot be said that where the parties consent to the basis for an order, or part of an order, that it is incumbent upon the Member to proceed to give detailed reasons about that issue.32 The learned Member allowed this item by consent, impliedly accepting it having considered s 84 of the Domestic Building Contracts Act 2000. I am not minded to allow the Browns to withdraw that consent in this appeal. [70] The second claim was for accommodation for Mr Ian Wayth, a Director of Noosa Constructions. It is in respect of this claim that a compromise figure was eventually used by the Tribunal following the exchange set out earlier. It should be noted that the amount in dispute is $207.00, that is, half of the $414.00 invoiced to the Browns. Initially, the evidence in this regard from Noosa Constructions in its filed statement of evidence, and at the hearing, was that Mr Wayth expended further monies on accommodation because availability of the unit to be supplied by the Browns had ceased.33 When Ms Brown advised the Member that the unit was in fact available at the relevant time, the evidence for Noosa Constructions appeared to change, alleging that the unit was full with other tradespeople. At its highest Noosa Constructions‟ evidence through Mr Idiens, another Director, was "why would Ian even go and get alternate accommodation if it was available?"34 Noosa Constructions‟ evidence in this regard was unsatisfactory. Had it wanted to prove that the unit was 30 Black, G v Toowoomba Resort Pty Ltd [2007] QCCTB 122. 31 Transcript page 38 line 13 and page 40, line 21. 32 Attorney-General v Kehoe [2000] QCA 222, 22; Tully v McIntyre [2001] 2 Qd R 338. 33 Document “Response to Brown Evidence” filed 6/1/12 at [17.2] and Transcript page 38, line 30. 34 Transcript page 39, line 7. -- 15 of 21 -- 16 full at the relevant time it could have called or presented direct evidence from Mr Wayth. That it elected not to do so attracts the inference that Mr Wayth, if called, would not have given evidence favourable to Noosa Constructions on this issue.35 [71] In any event this claim again relates to an unapproved variation. Noosa Constructions bears the onus to show that an allowance is necessary due to exceptional circumstances or that allowing the amount would prevent them suffering unreasonable hardship and that it would not be unfair to the Browns.36 [72] In contrast to other items that have been allowed Ms Brown had, prior to this variation, raised with Noosa Constructions concern about the unapproved use of other accommodation. She requested that her express consent be obtained in future.37 Allowance of the variation would be unfair to the Browns in these circumstances. I would reduce the amount recoverable by Noosa Constructions by $207.00. Bond return [73] As part of the supply of the unit for Noosa Constructions‟ workforce whilst on site, the Browns advised Noosa Constructions that a bond would be payable to the unit‟s owner. Noosa Constructions paid a bond of $250.00 to the owner. When Noosa Constructions sought return of the bond the Browns indicated that the owner would not release it because a handrail had been broken in the unit. Noosa Constructions‟ evidence was that the handrail had rusted through, and should not be its responsibility. [74] The learned Member‟s expressed view was "well that's a matter I'm not going to decide. It's not a building dispute matter. It's a bond matter”.38 [75] The Browns complain in their appeal that notwithstanding this decision, they were in fact ordered, by operation of the calculation of the amount to be paid to Noosa Constructions, to return the bond. This allegation is supported by an examination of the calculation undertaken by the learned Member.39 The bond amount was contained in the variation for accommodation, which the learned Member allowed with only the $207.00 reduction referred to in [63] above. In those circumstances I would amend the learned Member's decision to reduce the amount to be received by Noosa Constructions by a further $250.00. Accommodation for Noosa Constructions during the rectification ordered by the Tribunal [76] As stated, the Browns were to provide accommodation for Noosa Constructions‟ workers on Fraser Island during the course of the contract. 35 Jones v Dunkel [1959] 101 CLR 298. 36 Domestic Building Contracts Act 2000 s 84(4). 37 Email 29 September 2010. 38 Transcript page 79 line 40. 39 Transcript pages 100 and 101. -- 16 of 21 -- 17 This had been negotiated at the outset of the contract, and a variation agreed. At the hearing the learned Member ordered that similar accommodation be provided by them whilst the defects were rectified. The Browns say that there was no basis for the Tribunal to make such an order. [77] Certainly, the learned Member‟s reasoning in this regard is not apparent. With respect, it is difficult to ascertain the basis upon which he decided that the Browns were responsible for the cost of supplying a unit for the purpose of the rectification work. If all of the work had been completed appropriately during the course of the contract period, they would not have incurred this expense. Compliance with the Tribunal's order to remedy the defects was an obligation placed on Noosa Constructions as opposed to, say, paying as damages the cost of an independent builder doing the work. If an independent builder had been contracted they would have included the cost of accommodation in their quotation, and quite properly that expense would have been passed on to Noosa Constructions. I would not allow this claim. [78] The unchallenged evidence at the hearing was that the Browns obtained the benefit of the unit for $250.00 per week. Two weeks were allowed for the rectification work. I would reduce the amount recoverable by Noosa Constructions under the learned Members order by $500.00. No gutter to entry roof [79] The learned Member heard evidence about this issue. He accepted the Browns' claim and made a monetary allowance. He accepted the only evidence before him as to the cost of rectifying the defect in the sum of $128.00. That evidence as to the cost was submitted by Mr Idiens for Noosa Constructions at the hearing. The Browns had no evidence as to the cost to rectify this item. With respect to the learned Member, in circumstances where the Browns sought rectification and where the Member was ordering Noosa Constructions back on site to remedy other defects, it is not apparent why rectification was not ordered on this item, as opposed to a monetary adjustment. [80] The Browns say that the amount allowed was only sufficient to cover the cost of gutter guard and not for the installation of the gutter itself. Evidence given to the Tribunal for Noosa Constructions on this issue was as follows: Member ―Okay. So there's a credit. Is that what – what's the credit? What was the cost of the gutter?‖ Mr Idiens ―gutter guard, yes.‖ Member ―is it gutter or gutter guard?‖ ―Support person‖ ―gutter.‖ -- 17 of 21 -- 18 Mr Idiens ―sorry, gutter.‖40 [81] Even in the absence of independent evidence of the value of this work, doubt is raised by this exchange as to whether the amount proposed for rectification by Noosa Constructions bore any resemblance to the actual cost. [82] The issue relates to a finding of fact by the learned Member. The first question for the Appeal Tribunal is whether leave to appeal on this issue should be granted. The Browns were clearly aware, from the decision of the learned Member, that a monetary adjustment as opposed to rectification could be ordered. They have still provided no evidence of the cost of the work. Noosa Constructions has also failed to adduce any further evidence on this point. [83] The material reveals that the work in question relates to the installation of approximately 2.4m of gutter with gutter guard and connecting it to a pre- existing downpipe.41 I am not satisfied, given the paucity of evidence, that the benefit in granting leave and remitting the matter would be substantive.42 That paucity also prevents the Appeal Tribunal from resolving the matter by another order. I would not grant leave to appeal this aspect of the learned Member‟s decision. Costs [84] The Browns seek an order that they recover their costs of and incidental to the application and appeal. In particular they seek the hearing application fee in the sum of $270, legal costs in the sum of $3,523.50, the appeal application cost of $530 and costs of obtaining the transcript of the original hearing in an amount they said they would advise. Costs of the original application and the application fee [85] In relation to the initial application fee and legal costs these matters were dealt with by the learned Member at the original hearing. During the hearing he stated "lawyers in this jurisdiction appear in the jurisdiction after the Tribunal has given the parties leave to be represented, and once that happens, then you've got a basis of asking for legal costs."43 [86] In refusing to make an order that either party pay or contribute to the other‟s costs, when giving his decision the Member said, I'm going to make an order that there be no order as to costs. The reason for that is that while both parties incurred costs of lawyers in the lead up to the proceedings, no lawyers have been represented in the 40 Transcript page 33 lines 12-24. 41 Noosa Constructions‟ response to the appeal on the 7th page of annexure. 42 Cachia v Grech [2009] NSWCA 232. 43 Transcript page 98, line 27. -- 18 of 21 -- 19 Tribunal (sic), and this Tribunal is not aware of there ever having been an order made that legal representation was allowed in the Tribunal.44 Later, after having been interrupted by Ms Brown, the learned Member added "The Queensland Building Services Authority Act says that in this jurisdiction both parties meet their own costs, okay, and there are exceptions for it. The exceptions don't, to my mind, apply in these circumstances…”45 [87] This last statement does not, with respect, accurately reflect the law on this issue. [88] Section 77(2)(h) of the Queensland Building Services Authority Act 1991 authorises the Tribunal to “award costs”. It has been held that this modifies the general position under the QCAT Act that, ordinarily, each party would bear their own costs.46 The result of this is that in applications for costs in the Tribunal‟s building jurisdiction, the Tribunal exercises a “broad general discretion which must be exercised judicially"47. [89] There are two significant factors which militate against an order for costs, properly considered, in this matter. The first is that the Browns were unsuccessful in many aspects of their application, and many of those decisions are confirmed on appeal. In relation to a number of issues they have pressed their claims without leading any compelling evidence in that regard. [90] Secondly, the Browns provided no evidence of their legal costs at the hearing. In their appeal there is merely a bald assertion that they have incurred costs in the sum of $3,523.50 with no evidence the Tribunal could rely upon to substantiate this claim, or differentiate what it related to. [91] As has been stated by Member Howard48: The statutory regime under which the Queensland Civil and Administrative Tribunal operates places obligations upon parties themselves to take care in their dealings with Tribunal matters, and to act in their own best interests. QCAT’s resources for the resolution of disputes are in high demand and serve, as the High Court has recently observed in relation to court resources, „… the public as a whole, not merely the parties to the proceedings‟.” I would confirm the Member‟s decision at first instance not to award legal costs. 44 Transcript page 103, line 23. 45 Transcript page 104, line 3. 46 Lyons v Dreamstarter Pty Ltd [2011] QCATA 142. 47 Lyons v Dreamstarter Pty Ltd [2011] QCATA 142at [33]; Latoudis v Casey (1990) 170 CLR 534. 48 Lida Build Pty Ltd v Miller and Anor [2011] QCATA 219 at [10] quoting Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175, 217. -- 19 of 21 -- 20 [92] The Browns did not raise the issue of the filing fee with the member at the hearing. They could have sought payment of the filing fee pursuant to rule 85 of the Queensland Civil and Administrative Tribunal Rules 2009. Allowance of the claim is discretionary. The Browns have been unsuccessful in a large number of the issues they sought to dispute and in the overall resolution of the outstanding financial matters between the parties. In the exercise of my discretion I would confirm the Member‟s orders at first instance and make no order for recovery of the filing fee. Costs of the appeal [93] In relation to those costs which relate to the conduct of the appeal, the matter is more difficult. The Browns have been partially successful in the appeal largely because the learned Member at first instance did not give adequate reasons. [94] In the absence of countervailing considerations, the costs of having that omission remedied should not fall upon Noosa Constructions, nor should the cost of pursuing the appeal be seen to have partially robbed the Browns of its efficacy. [95] It is appropriate to consider the application for these costs in light of the overall result of the Appeal, and the conduct of the parties. [96] Whilst it was the Browns‟ right to receive a properly explained decision, that was not the primary thrust of their appeal. In fact, despite the amendments made to the learned Member‟s orders discussed above, they have been largely unsuccessful. A number of the grounds alleged in the appeal were unsupported by any evidence and were reflective of a lack of consideration. [97] Further, their appeal was conducted largely, and similarly to the original hearing, by making relatively concise written submissions in lieu of statements of evidence. These were supported by the production of a large volume of unreferenced, un-paginated and often duplicated documents. [98] In the circumstances, weighing all of the relative merits, I would make no order as to these costs. Orders [99] The appeal is allowed but only to the following extent: 1. The Order of the Tribunal dated 3 February 2012 numbered 1 is amended by reducing the amount to be distributed to Noosa Constructions Pty Ltd by the sum of $957.00 and increasing the amount to be distributed to Deborah Brown and Christopher Brown by the sum of $957.00. 2. In the event that the funds referred to in that Order have already been distributed to the parties by the Queensland Master Builders -- 20 of 21 -- 21 Association, then Noosa Constructions shall pay to Deborah Brown and Christopher Brown the sum of $957.00 within 21 days of this Order. 3. The application by Deborah Brown and Christopher Brown for their costs of the Appeal is dismissed. -- 21 of 21 --