Dainford (Constructions) Pty Ltd & Dainford Ltd v Builders' Registration Board of Queensland [1990] QSCFC 99

IN THE SUPREME COURT OF QUEENSLAND Y FULL COURT No. 1827 of 1990 BEFORE : _______ REVISED COPIES ISSUED" j Court Pcp'nlr.s bureau I Date: /^/ / jo*, j BRISBANE, 14 DECEMBER 1990 10 Mr. Justice Williams Mr. Justice Ryan Mr. Justice Dowsett (Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Chief Court Reporter , Court Reporting Bureau.) 10 20 30 40 50 60 BETWEEN: DAINFORD (CONSTRUCTIONS) PTY . LTD. (First Plaintiff) Respondent - and- DAINFORD LIMITED - and (Second Plaintiff) Respondent THE BUILDERS' REGISTRATION BOARD OF QUEENSLAND (Defendant) JUDGMENT Appel1 ant MR. JUSTICE WILLIAMS: This Full Court was constituted by Mr. Justice Ryan, Mr. Justice Dowsett and myself. I will ask my brother Ryan to deliver the first judgment. MR. JUSTICE RYAN: I would allow the appeal, discharge the injunction and order the respondents pay the costs of the motion and this appeal to be taxed. I publish my reasons. MR. JUSTICE WILLIAMS: I agree with the reasons published by my brother Ryan and with the orders he proposes. I am authorised by my brother Dowsett to say that he also 30 40 50 60 Printer, Q!^ 1 [1990] QSCFC 99 -- 1 of 14 -- agrees with those reasons and with the orders proposed. 1 The orders will be as indicated by my brother Ryan. MR. FRASER: Your Honour, there were some reserved costs of the appeal. I donot know if it is necessary to include the words "including reserved costs". That was from the motion to expedite the hearing of the appeal. I have discussed it with my learned opponent and he has indicated that it is appropriate that that be dealt with notwithstanding the absence of your brother Dowsett. In those circumstances could I ask for that order? MR. JUSTICE WILLLIAMS: The order for costs will include the reserved costs. 20 2 (f 30 30 40 40 50 50 60 60 — Govt. Printer, Qld. 2 -- 2 of 14 -- IN THE SUPREME COURT OF QUEENSLAND FULL COURT WRIT No. 1827 of 1990 s\ y BETWEEN : DAINFORD (CONSTRUCTIONS) PTY . LTD. (First Plaintiff) Respondent AND: DAINFORD LIMITED (Second Plaintiff) Respondent AND: THE BUILDERS 1 REGISTRATION BOARD OF QUEENSLAND (Defendant) Appellant WILLIAMS J RYAN J DOWSETT J Reasons for judgment delivered by Ryan J on 14th December 1990. Williams J and Dowsett J agreeing with the reasons and order. "APPEAL ALLOWED AND INJUNCTION DISCHARGED. ORDER THE RESPONDENTS PAY THE COSTS OF THE MOTION AND OF THIS APPEAL INCLUDING RESERVED COSTS TO BE TAXED." -- 3 of 14 -- IN THE SUPREME COURT OF QUEENSLAND FULL COURT No. 1827 of 1990 Before the Full Court Mr. Justice Williams Mr. Justice Ryan Mr. Justice Dowsett BETWEEN : DAINFORD (CONSTRUCTIONS) PTY , LTD. (First Plaintiff) Respondent - and - DAINFORD LIMITED (Second Plaintiff) Respondent - and - THE BUILDERS' REGISTRATION BOARD OF QUEENSLAND (Defendant) Appellant JUDGMENT - RYAN J. Delivered the Fourteenth day of December, 1990. CATCHWORDS: Interlocutory Injunction - Appeal - Review by Appellate Court - Setting aside exercise of discretion - Board required in circumstances to conduct an inquiry - Whether grounds for restraining Board from conducting inquiry. Counsel: D.B. Frazer for Appellant R.N. Wensley for Respondent Solicitors: Lyons for Appellant T.F. Wardrobe T/A for McLaughlin Gordon & Lennon for Respondent Hearing dates: 6 December, 1990 -- 4 of 14 -- IN THE SUPREME COURT OF QUEENSLAND FULL COURT No. 1827 of 1990 BETWEEN: DAINFORD (CONSTRUCTIONS) PTY . LTD, (First Plaintiff) Respondent - and - DAINFORD LIMITED (Second Plaintiff) Respondent - and - THE BUILDERS' REGISTRATION BOARD OF QUEENSLAND (Defendant) Appellant JUDGMENT - RYAN J. Delivered the Fourteenth day of December, 1990. This is an appeal from an order made by the Chamber Judge on 16 November 1990, by which it was ordered that the defendant, the Builders' Registration Board of Queensland (the Board), be restrained from embarking upon or continuing an inquiry pursuant to the provisions of the Builders' Registration and Home Owners Protection Act 1979 as amended (the Act), into the matter of complaint specified in a Notice to Show Cause, dated 5 November 1 990, made by the defendant and addressed to the first plaintiff. The injunction was to continue until midnight on 31 January 1991 . In 1982, the second plaintiff was the developer of a 40 storey home unit building called "Imperial Surf" at Surfers Paradise. The first plaintiff, which is a wholly-owned subsidiary of the second plaintiff, constructed the building for -- 5 of 14 -- 2 the second plaintiff. It is a registered general builder under the Act. The building was completed in December, 1982. In July 1987 the Board issued an order pursuant to s. 59 of the Act directing the first plaintiff to cause to be done certain building work alleged to be faulty or unsatisfactory. It appealed against that order. The appeal was dismissed by consent, and the appellant did not pursue the order. In December 1988 the Body Corporate commenced proceedings against the respondents claiming damages for breach of contract and negligence. On 25 October 1989 the appellant issued an order pursuant to s. 59 of the Act. It is in these terms: "Whereas you have performed certain building work at Imperial Surf Units, 3259 Gold Coast Highway, Surfers Paradise, Queensland or alternatively have caused the performance of the said work, and Whereas the Builders' Registration Board of Queensland is of the opinion that the building work listed in the Schedule hereto is faulty or unsatisfactory. Now Take Notice that you are hereby Ordered to Remedy the said building work within 30 days of the date of this order. The Schedule sets out as faulty or unsatisfactory work : 1. Brackets, rivets etc., used to fix balcony handrails to the external walls of the building are inadequate or ineffective and have failed in some instances. 2. Joint details to the handrails at straight sections and change-of-direction are inadequate or ineffective and failures have occurred in some cases . 3. Bolt fixings to bases of handrail staunchions have been missed in some cases throughout the building. 4. Balustrade construction generally (original and as "rectified") is not structurally adequate with -- 6 of 14 -- 3 particular regard to (a) the corrosion protection and (b) the vertical upright. This order was served upon the first plaintiff on 28 November 1989. The first plaintiff did not appeal against this order, but entered into negotiations with the appellant. On 24 July 1990, a letter was sent to the first plaintiff by the appellant. It is in these terms: "I confirm that a meeting took place at Imperial Surf Units on Thursday 19 July 1990 between all interested parties as far as the Board's rectification Order dated 25th October 1989 is concerned. The discussions seemed to resolve the extent of rectification required by Item No. 1, 2 and 3 of the Order Schedule. However, we have been asked to clarify Item No. 4 for the benefit of all parties .... The reference to the balustrades being not structurally adequate is, I think self-explanatory, and the rectification required by item nos. 1, 2 and 3 would obviously support that view. Regarding the corrosion protection, I confirm that the matter of any corrosion to the base plates of the vertical members has been decided quite some time ago and is therefore not included in the current Order. The corrosion in other parts of the installation include items such as the small fixing brackets, the actual fixing mechanisms etc., which our inspections have shown to be corroded in some instances. The vertical uprights were included in the Order following discussions on the site prior to the Order date when we felt there was to be some combined rectification of the base plates, staunchions etc. The vertical uprights may, in conjunction with the other rectification in items nos. 1 , 2 and 3 be able to be certified by the builders' Engineer and if that eventuates then the terms of item no. 4 will be satisfied." On 16 October 1990, the first plaintiff's solicitors wrote to the appellant. They stated that it was prepared to comply with items 1 , 2 and 3 of the Schedule to the Order, but said that the Board did not have the power to make the order in respect of item 4. They claimed that the issue raised by item 4 was one of "design", and that the appellant had no power to -- 7 of 14 -- 4 impose an obligation on the builder to implement a different design. On 19 October 1990, the Registrar of the Board made a complaint to the Board against the first plaintiff that it had failed to comply with an order of the Board dated 25 October 1989 issued under s. 59 of the Act, which Order required them to remedy within 30 days certain faulty or unsatisfactory building work at Imperial Surf Units. The complainant gave particulars of the alleged failure as are set out in the Board Order. On 5 November 1989, the appellant issued a notice to show cause. This recited the complaint, that the Board had found that some action should be taken in relation to the matter of the complaint, and that the Board proposed to conduct an inquiry. It therefore called upon the first plaintiff to show cause why its registration under the Act should not be cancelled or suspended at an inquiry to be held on 19 November 1990. This action was taken by the Board pursuant to s. 45(1} of the Act. This provides: "Upon receipt by the Board of a complaint (which complaint subject to subsection (2) may be made orally or in writing) against a registered building the Board, if it finds that some action should be- taken in relation to the matter of complaint, shall - (a) send to the registered builder a notice in writing of the complaint against him and particulars thereof; and (b) conduct its inquiry into the matter of the complaint, giving to the registered builder an opportunity to show cause why his registration under this Act should not be cancelled or suspended." It is clear that the Board is required to conduct an inquiry into the matter of the complaint, provided it receives -- 8 of 14 -- 5 a complaint against a registered builder and it finds that some action should be taken in relation to the matter of complaint. It is not a precondition to the exercise of its jurisdiction that it should be satisfied that the complaint is made out in all its particulars. Section 45(3) provides that after the inquiry referred to in sub-s. (1), the Board may - (a) determine to take no further action in relation to the complaint ; (b) reprimand or caution the registered builder; (c) by its order, subject the registration of the registered builder to such conditions and restrictions as it thinks f it ; (d) by its order, suspend for a period determined by it the registration of the registered builder upon a ground specified in section 44(1) and proved in the inquiry; (da) by its order - (i) suspend for a period determined by the Board the registration of the registered builder, upon a ground specified in s. 44(1) and proved in the inquiry, with respect to building construction other than the building construction directed to be rectified pursuant to provision (ii); and (ii) direct the registered builder to rectify to the satisfaction of the Board, within a period determined by the Board and specified in its order, any building construction in relation to which a ground specified in s . 44(1) has been proved in the inquiry; or -- 9 of 14 -- 6 (e) by its order, cancel the registration of the registered building upon a ground specified in s. 44(1) and proved in the inquiry. Among the grounds specified in s. 44(1) is:- (k) has failed to comply with an order of the Board issued under s. 59. A request by the solicitors for the first defendant for an adjournment of the hearing on the basis of its work commitments was refused by the appellant. Thereupon a writ of summons was issued on 12 November 1990, by which the plaintiffs claim: (a) a declaration that an order made by the defendant bn 25 October 1989 is, insofar as it relates to item 4 of the schedule hereto, void and of no effect and does not bind the plaintiff; (b) in the alternative, a declaration that the plaintiff is not obliged to comply with the said order, insofar as it relates to the said item 4; (c) an injunction restraining the defendant from conducting any inquiry pursuant to the provisions of s . 45 of the Act, including any inquiry as is referred to s . 45(1) thereof, wherein the first plaintiff's failure to comply with the said order of the Board, insofar as it relates to the said item 4, is sought to be raised as a ground for the cancellation or suspension of the registration of the first plaintiff as a registered builder in Queensland, or for any other disciplinary action against the first plaintiff pursuant to the provisions of the Act. -- 10 of 14 -- 7 At the hearing on the application for the injunction there was read an affidavit filed on behalf of the defendant stating that there were reasons of public safety which required that the matter be resolved with a great deal of expedition. Those matters included the lack of security of the balustrading presently around the balconies of "Imperial Surf" and the very great risk that a person leaning against any such balustrade may be injured or killed if it gave way. There was however material filed on behalf of the plaintiffs which contested these allegations. The learned Chamber Judge observed that the notice of motion by which the plaintiffs sought the injunction was limited to item 4, but that counsel for the applicants had made it clear that they were really seeking injunctive relief in respect of the whole of the ambit of the inquiry . He then stated - "The defendant is entitled to have such an inquiry and that entitlement is found under s. 45 of the Act." With respect, this is not accurate. The defendant was not only entitled to have an inquiry; it was obliged to conduct one once it was found that some action should be taken in relation to the matter of complaint. The issue was not, therefore, whether the Board should be restrained from conducting an investigation which it was authorised to carry out, but rather one which it was obliged to carry out. The matters which the learned Chamber Judge emphasised in the course of concluding that an interlocutory injunction should be granted were these: (a) It appeared from an affidavit filed on behalf of the plaintiffs that the work required by the 1989 show cause -- 11 of 14 -- 8 notice had been set in train and work had gone on for some six to eight weeks. (b) Rectification of items 1, 2 and 3 might have the effect that the terms of item 4 would be satisfied. (c) The Board, with knowledge that the plaintiffs had commenced work to rectify items 1, 2 and 3, had put the plaintiffs in a position where they would incur considerable cost and expense in preparing to attend the meeting it had called. (d) The action of the Board was oppressive in the circumstances. In addition, it was denying the right of the plaintiffs to have tried a serious question, namely the effect on the applicant of the last sentence in the Board's letter of 24 July 1990. Upon an appeal from a judge's grant of an interlocutory injunction, it was said in Hadmor Productions v. Hamilton (1983) A .C . 191 at p. 220 that: "The function of the appellate court is originally one of review only. It may set aside the judge's exercise of his discretion on the ground that it was based upon a misunderstanding of the law or of the evidence before him, or upon an inference that particular facts existed or did not exist, which, although it was one that might legitimately have been drawn upon the evidence that was before the judge, can be demonstrated to be wrong by further evidence that has become available by the time of the appeal; or upon the ground that there has been a change of circumstances after the judge made his order that would have justified his acceding to an application to vary it. Since reasons given by judges for granting or refusing interlocutory applications may sometimes be sketchy, there may also be occasional cases where even though no erroneous assumption of law or fact can be identified, the judge's decision to grant or refuse the injunction is so aberrant that it must be set aside upon the ground that no reasonable judge regardful of his duty to act judicially could have reached it. It is only if and after the appellate court has reached the conclusion that the judge's exercise of his discretion must be set aside for one -- 12 of 14 -- 9 or other of these reasons, that it becomes entitled to exercise an original discretion of its own." In my judgment, there was in this case a failure to identify the critical point that the Board was required in the circumstances to conduct an inquiry, and that warrants this court setting aside the exercise of discretion by the Judge and exercising its own discretion. Accordingly, it is first necessary to ascertain whether the plaintiff has established that there is a serious question to be tried. That question is identified in the writ as being one as to the effect of the order so far as it relates to item 4. There appear to be two grounds assigned for challenging the order. One is that it relates to a matter of design, and that pursuant to s . 59 of the Act the Board has no power to impose an obligation on a builder to implement a different design. The other is that the order is so uncertain that the plaintiffs do not know what they are required to do. The order made pursuant to s. 59 of the Act on 25 October 1989 required the builder to remedy building work that was faulty or unsatisfactory, and it listed the work which was faulty or unsatisfactory. It did not attempt to specify the methods to be used in rectifying the faulty work. No appeal was made against this order. If an appeal had been instituted, the court hearing the appeal under s. 60 may have set aside the order of the Board or varied it in such a way as the court thought just, upon a hearing de novo. The order made does not in terms require the builder to implement a different design or require him to remedy a design fault. In R, v. McGuire and Hanlon Homes, ex parte Builders -- 13 of 14 -- 10 Registration Board (1986) 1 Qd.R. 61 it was said that s. 49(1) of the Act authorised the Board to make an order expressed in the broad terms envisaged by that provision; it is not required, as in the case of a mandatory injunction or order, to inform the defendant of precisely what is required to be done under the order. But even assuming in the respondents' favour that they have made out a serious case to be tried, I consider that the balance of convenience does not favour the grant of an injunction restraining the conduct of the inquiry. The situation is one where the Board is required by law to conduct an inquiry, where there is at least some ground for concern'that the safety of members of the public may be in jeopardy, and where the respondents had delayed for several months in complying with an order of the Board against which they had not appealed. There is no reason to assume that the Board will not conduct its inquiry properly, including granting adjournments if that is justified. I would allow the appeal, discharge the injunction, and order the respondents to pay the costs of the motion and of this appeal to be taxed . -- 14 of 14 --