Campbell v Kerry M Ryan Pty Ltd [2012] QCAT 402

CITATION: Campbell v Kerry M Ryan Pty Ltd [2012] QCAT 402 PARTIES: Stephen John Campbell (Applicant) v Kerry M Ryan Pty Ltd (Respondent) APPLICATION NUMBER: BDL266-10 MATTER TYPE: Building matters HEARING DATE: 30 and 31 January 2012 HEARD AT: Brisbane DECISION OF: Michelle Howard, Member DELIVERED ON: 31 July 2012 DELIVERED AT: Brisbane ORDERS MADE: 1. The application is dismissed; 2. That any application for costs and supporting submissions be filed and served by 4pm on 17 August 2012; 3. That any submissions in response be filed and served by 4pm on 31 August 2012; 4. That unless otherwise ordered any application for costs be determined on the papers without an oral hearing. CATCHWORDS: DOMESTIC BUILDING DISPUTE – contract for the sale and delivery of a removal house – whether plans subsequently obtained by the purchaser form part of contract between the parties DOMESTIC BUILDING DISPUTE – construction of terms of written contract for sale and delivery of removal house Domestic Building Contracts Act 2000 Hume v Rendell (1824) 57 ER 311 York Airconditioning & Refrigeration -- 1 of 21 -- 2 (Australasia) Pty Ltd v Commonwealth (1949) 80 CLR 11 Hospital Products Limited v United States Surgical Corporation (1984) 156 CLR 41 APPEARANCES and REPRESENTATION (if any): APPLICANT: Mr Daniel Favell of Counsel, instructed by Colwell Wright Solicitors RESPONDENT: Mr Scott Neaves of Counsel, instructed by Jon Kent Lawyers REASONS FOR DECISION [1] This is a claim for damages arising out of a contract for the sale and delivery of a removal house. [2] On 2 August 2005, Mr Campbell, entered into a written contract1 with Kerry M Ryan Pty Ltd (referred to as KMR or the removalist), a house removalist business, to purchase a removal house held at their Minden yard. The purchase price was $66,000. Mr Campbell alleges various oral variations to the contract, some of which are acknowledged by Mr Kerry Ryan, director of KMR. The house was delivered to Mr Campbell’s 4,000 square metre rural property at Willis Road, Meringandan on 13 October 2006. However, due to issues arising on that day and subsequently, it was not positioned and stumped on the site until about 18 January 2007. [3] Mr Kerry Ryan holds a licence through the Building Services Authority (QBSA) as a house removalist. His evidence is that the QBSA licence entitles him to cut and rejoin removal houses, put up stairs, stump and related tasks, but not to do broader and more general building work. He explained that he can not be contracted to build an extension to someone’s house. As he described it, essentially, the license allows him to put back what was there once a house is moved, although moving of a house itself does not require a licence. [4] At the time the contract was entered into between Mr Campbell and KMR, Mr Campbell was an employee of the business, and had before this employment, worked in the house removal industry. However, he does not hold a QBSA building license or formal building qualifications. [5] Mr Campbell made an application seeking damages and interest in the amount of $178,649.83. At hearing, the quantum of damages sought, for breach of contract was amended to $71,592.55. Mr Campell’s claims and the amounts sought by way of damages to rectify the alleged defect/s are briefly set out as follows: 1 Exhibit 1 Attachment A. -- 2 of 21 -- 3 (a) the house was not located in accordance with the contract and is 215 millimetres out of position: $7,006.46 is claimed for reinforcement of the foundations as a consequence of the alleged breach; (b) the height of the building is not in accordance with the contract and must be raised at a cost of $22,500; (c) contrary to the contract the ground floor block walls, kitchen and bathroom and associated plumbing and electrical services and septic tank were demolished and the existing dwelling above which the removal dwelling was to be positioned must be rectified at costs claimed totalling $21,424.09; (d) the gable end walls constructed are hardiflex, not blue board as the contract required: $5,150 is claimed to have them constructed with blue board; (e) damage to the external cladding not rectified by KMR: $2,112 is claimed for rectification; (f) the roof sheeting is defective: $10,590 is claimed to rectify it; and (g) the roof void requires work because of a pigeon infestation caused by KMR failing to seal off the void and insulate the void as required: $2,810 is claimed for cleaning and installation of insulation. [6] Several other claims originally made for the costs of replacing damaged carpet and loss of opportunity to rent the premises were abandoned at hearing. [7] In essence, Kerry Ryan responds that the claim is based on alleged oral agreements outside of the written contract which it says the tribunal could not be satisfied exist as claimed or were not the company’s responsibility. [8] The proceeding was heard on 30 and 31 January 2012. Written submissions were subsequently provided by the parties as directed during February 2012. [9] Determining the proceeding requires consideration of events which occurred concerning the making and variation of the contract, and actions taken by the respective parties over the period from 2006 to 2010, as well as expert evidence regarding some issues. The primary issues for determination are what the contract required; whether it has been breached as alleged; and if so, whether damages have been occasioned to Mr Campbell. [10] For the reasons discussed in the following paragraphs, all aspects of the claim are unsuccessful. Legal Framework -- 3 of 21 -- 4 [11] It is common ground that the Domestic Building Contracts Act 2000 applied to the contractual arrangements between the parties. Sections 26 and 79 require a building contractor to ensure that contracts and any variations to contracts respectively for domestic building work are in writing. Under section 84, failure to obtain written variations may affect the rights of a building contractor to recover additional amounts claimed as owing as a result of the variation. However, failure to do so does not make the contract illegal, void or unenforceable: section 92. [12] The Domestic Building Contracts Act 2000 operates to imply warranties into domestic building contracts which it regulates: some warranties are implied into all such contracts, while others are implied for particular contracts. Under section 42, in all regulated contracts, all materials used will be good and suitable for their purpose, and unless otherwise specified, will be new. Under section 43, relevant laws and legal requirements must be met in performing the works in all contracts. Under section 44, all works are to be done in an appropriate and skilful manner and with reasonable care and skill. Section 45 provides that if plans and specifications form part of the contract, there is an implied warranty given by the builder that the work will be carried out in accordance with the plans and specifications. [13] The meaning or construction of a contract is a matter of fact and is approached with a view to construing the document as a whole.2 It requires giving effect to the intentions of the parties,3 as ascertained objectively.4 The evidence and issues of credit [14] The parties disagree on many factual issues. In support of the claim Mr Campbell relied on his own evidence, together with evidence of Mr Wilkes, an engineer whom he had engaged to prepare the foundation plan and during the construction, and Mr Adams, a builder, carpenter and joiner, whom he retained as a building inspector during the proceedings. [15] On behalf of KMR, Mr Kerry Ryan gave evidence, as well as Mr Sean Ryan and Ms Jenny White, both employees of KMR; Mr John White, Ms White’s husband, who assisted Mr Campbell to prepare the site; and Mr Richard Hails, a neighbour of Mr Campbell’s Meringandan property. Also, Mr Mark King, an engineer, engaged for the proceedings gave evidence. [16] Mr Campbell gave oral evidence that he has scotopic sensitivity syndrome, which he said is a form of dyslexia and intellectual disability. He said that he had told Mr Kerry Ryan about it, but this was denied by Mr Ryan. There is no evidence of diagnosis or the nature of any condition diagnosed. Mr Campbell did not exhibit any obvious signs of intellectual 2 Hume v Rendell (1824) 57 ER 311. 3 York Airconditioning & Refrigeration (Australasia) Pty Ltd v Commonwealth (1949) 80 CLR 11. 4 Hospital Products Limited v United States Surgical Corporation (1984) 156 CLR 41. -- 4 of 21 -- 5 disability. Accordingly, I have placed no weight on his evidence about the condition and its manifestations. [17] However, Mr Campbell did not impress as a reliable witness. His evidence was confused about some issues. One of the claims made is that the end walls were not finished by KMR in blue board as required by the plans. When cross-examined about this issue, Mr Campbell denied that ‘hardiflex’ was discussed at the time of the contract, saying words to the effect that ‘no, blue board was on the plans’. He then agreed that there were no plans at the time. When it was then suggested to him that he had not asked for blue board walls, he said words to the effect that ‘it was pretty hard to, considering there were no plans’. [18] Mr Campbell’s answers given in cross-examination were sometimes evasive and Mr Campbell’s statement evidence was successfully challenged in a variety of respects. For example, in answer to whether he had marked or pegged out where the house was to go were given equivocally, although ultimately his evidence seemed to be that he did not need to mark it out because the existing house did so. This appears contrary to his written statement which asserts that he told KMR’s representatives that he wanted the house located and built in accordance with the plans. His witness statement asserts that Mr Ryan contacted him to tell him he intended to use ‘the trailer instead of a crane to position the dwelling’. In cross-examination he admitted however, that he had not known KMR to use a crane to position a house on any occasion, and that a trailer was always used. [19] His written statement was to the effect that pigeons had entry to the home from October 2006 to June 2008, yet his recollection in oral evidence was that one of the first things he did was ‘get the pigeons out’. In the end he said that the statement must be correct about dates. Although it did not accord with his recollection, he suggested that his affidavit was more reliable, having been prepared several years ago. [20] Mr Campbell’s version of events is contradicted in many respects by Mr Kerry Ryan and KMR’s supporting non-expert witnesses, namely Mr Sean Ryan, Ms Jenny White, Mr John White and Mr Richard Hails. Those witnesses gave their evidence in an apparently forthright manner. Mr Kerry Ryan made concessions against KMR’s interests, regarding variations to the written contract which were not reduced to writing. Mr Hails has no personal connection to KMR or its employees. Further, it is not the case that they each say precisely the same thing about each event or issue. This is reassuring as memory varies from person to person and evidence which coincides precisely may lead to concerns about possible collusion. Critically however, their evidence is broadly consistent which led me to the view that it is reliable. [21] For these reasons, I accept the evidence of Mr Kerry Ryan and the non- expert witnesses who gave evidence in support of KMR about factual matters where their evidence differs from Mr Campbell’s. -- 5 of 21 -- 6 [22] Mr Wilkes, an engineer, who prepared the foundation plan for Mr Campbell and who inspected the site at various stages before and during construction also gave some limited evidence, some of it expert evidence and some of it not. He provided professional advice to Mr Campbell during the house project. It was Mr Wilkes who advised Mr Campbell, prior to one of them falling over during earthworks, that two block walls which were in contention in the proceedings were structurally sound. Therefore, his professional credibility in earlier confirming the structural integrity of the block walls was under scrutiny. [23] The non-expert evidence Mr Wilkes gave, which had the effect of giving some support to Mr Campbell’s assertion that the footings on which the removal house were eventually placed were not those dug by Mr Campbell himself, was given on the basis of his ‘perception.’ In effect, he said that as a matter of perception on Mr Campbell’s 4,000 square metre block, that the holes ultimately used for the footings may have been further over than the holes dug by Mr Campbell for this purpose. The allegation is that the house is some small distance of 215mm misplaced according to the plans. The inference from his evidence seems to be that although Mr Campbell had them in the right place, KMR re-dug them in the wrong place. [24] I consider that on a block of this size (although I acknowledge that Mr Wilkes’ interest was focused on the house site), as a matter of perception, it is most improbable that any person could discern a 215 mm difference. I formed the view that his non-expert evidence was unreliable. The clear inference from the non-expert evidence given as a matter of perception is that Mr Wilkes has adopted Mr Campbell’s cause in the proceeding. Therefore, his evidence about engineering matters is generally given little weight. That said, I have accepted some of the measurements he took as accurate in circumstances when no other evidence was presented about the measurements. [25] Expert evidence was also given by Mr Adams and Mr King. Mr Adams, a builder, carpenter and joiner, was retained by Mr Campbell to inspect the building. His evidence was generally helpful and I conclude reliable. However, in expressing some opinions, he relied upon the measurements of other persons. Further, in respect of some issues, namely the structural integrity of the external cladding, he ultimately deferred to engineering opinion. [26] Mr King, an engineer and builder, prepared a report relied upon by KMR. Mr King has received other work from KMR by way of providing plans for some of his customers. That said, his credibility was not seriously challenged. He had not been to the site himself however. He had sent a technician to take measurements, and relied upon those and photographs to make his comments. The contract, variations to the contract and the plans -- 6 of 21 -- 7 [27] The written contract is a brief document, entitled ‘Contract for the sale and delivery of Removal House’. It provides for a number of items to be provided by KMR, namely the removal house, soil test, plans, engineer’s report and energy efficiency report, transport to the nominated address, roof battens are to be replaced if required by council, road permits and escorts, and posts of 75 x 75 steel. Maximum height of posts is specified at 2.7 metres and maximum depth of posts at 1.2 metres. It also includes under the heading of ‘Other’ for ‘New roof and gutters, replace eave, re-do walls at each end’ and ‘steels in lieu of tanks and pumps to value of $2150’. It is not controversial that a corrugated iron roof was to be supplied. [28] It specifically provided that KMR would provide basic house plans for Council, and that any addition to the plans would incur an additional cost. The purchaser was responsible to provide ‘clear and trafficable access to the proposed house site and any assistance by way of trucks or tractors.’ If damage occurred during moving of the house, major structural components will be repaired by KMR: in the event of rain the house would be covered but if the tarp ‘is blown or reap by wind’ the removalist was not responsible for water damage. Internal and external plumbing including down pipes, sewerage, and electrical refitting or connection is specified as the responsibility of the purchaser. [29] The contract provided that the height of the building is defined ‘at the height of the tallest stump, from ground to bearer.’ Any additional height was at a specified cost per foot of stump. Similarly, maximum depth of holes is defined, and any extra depth was at an additional specified cost per hole. [30] The purchaser is responsible for ensuring boundaries are accurate and to mark or peg out where the building is to be relocated on the site and to ensure that there are no underground electric cables, phone cables, sewerage and water pipes. The contract provides that on delivery, the purchaser will become responsible for security of the building and all damage caused by ‘fire, vandalism, wind or water other than damage directly caused by the Contractor in the course of his building activities’. [31] Cross-bracing, adjustable stumps and any extra steel stumps and beams required are at additional cost to the Purchaser. If it is not possible to bore postholes to the depth required by the approved plans with a standard post hole borer, the removalist is to have the engineer review the design and arrange jackhammers to complete the job in accordance with the revised design, at additional cost to the Purchaser. [32] Section 44 of the DBCA Act operates to imply a warranty into the contract that all building work done by KMR will be done in an appropriate and skilful manner and with reasonable care and skill. [33] Section 42 has application also. This contract is for the sale and delivery of a removal house: therefore, other than the house itself only those items -- 7 of 21 -- 8 supplied in addition to the house itself are required to be new. The items specified as ‘Other’, including the roof and gutters must be new. Oral variations to the contract [34] Mr Kerry Ryan acknowledges that several variations which were agreed subsequent to the execution of the contract should have been reduced to writing, but that they were not. He acknowledges agreeing to Mr Campbell having the plans drawn; installation of a colour-bond roof instead of the corrugated iron roof (at an additional cost); and siting the removal house over two existing block walls. [35] If KMR obtains plans, it is for the purposes of obtaining council approval. The plans are basic. Mr Campbell wanted to do other work under the house, so he wanted to have them done. Mr Kerry Ryan agreed to this. [36] Mr Campbell had several discussions with Mr Ryan about his desire to place the removal house over an existing house, although he acknowledges that Mr Kerry Ryan pointed out that he could not drive through walls. Mr Kerry Ryan says he was aware that the plans to be obtained by Mr Campbell would incorporate two existing walls, and that the house would be set on those 2 walls and stumps to be installed by KMR. He was not concerned about the implications of this arrangement for the removal process because under the contract the purchaser must prepare the site so that the lift can be done. If an earth ramp was necessary because of existing walls, that was the purchaser’s responsibility. [37] Although the variations were required under the Domestic Building Contracts Act 2000 to be in writing, the failure to reduce them to writing does not make the agreement void or unenforceable. [38] Ms Jenny White saw Mr Campbell installing steel beams under the removal house while it remained at KMR’s Minden yard and he spoke to her about doing so. This was not disputed by Mr Campbell, although there is no suggestion by either party that the contract was varied to accommodate this installation. The Plans [39] In preparation for the drawing of the plans, Mr Campbell had a foundation plan prepared by Mr Wilkes incorporating the existing two block walls. Mr Wilkes opined that they were suitable for the foundation of the removal dwelling.5 The foundation plan is endorsed as drawn for Mr Campbell. Mr Wilkes says that when the plans were prepared, he considered the concrete masonry walls were in reasonable condition and structurally sound. 5 Exhibit 1 Attachments F and G. -- 8 of 21 -- 9 [40] The plans for the dwelling at Mr Campbell’s property are dated 2 April 2006, some 8 months after the contract was executed. They refer to KMR as the builder. They incorporate what is described as the existing ground floor and the first floor relocated dwelling.6 They bear endorsement of building approval from Rosalie Shire Council dated 15 June 2006.7 [41] The plans specify an under-ceiling height of 2,600 mm from floor level. Consistent with the oral evidence of Mr Wilkes, they denote a concrete slab to be laid on top of the existing slab after stumping. [42] Mr Kerry Ryan asserts that Mr Campbell had no right to nominate him as the builder. Mr Kerry Ryan says that he is a house removalist and not a builder. Mr Kerry Ryan understood that Mr Campbell intended to do work at the home after it was moved there, he understood, as an owner-builder. His understanding was that because KMR was nominated as builder, KMR was represented as responsible for all works done or to be done on site, which was not correct. No explanation was given by Mr Campbell for nominating KMR as builder. The development application was signed by Mr Campbell. Further, Mr Campbell acknowledged that the plans included work that he personally was to do. [43] The 11 pages of plans which Mr Campbell says he gave to KMR in July 2006 refer to concrete piers to engineer’s design and specification.’8 However, the foundation plan does not form part of those plans. Mr Campbell does not say that he gave the foundation plan to KMR.9 [44] Mr Kerry Ryan said that the usual practice was to have the purchaser provide or have available a copy of the plans at the time of delivery of a removal home. Mr King gave evidence to the effect that plans may not be sufficiently detailed or accurate as to fence line to allow a house to be positioned precisely and that is why the owner or builder for the overall project, as opposed to the removalist, usually determines that the position is correct. He indicated that in instances where the precise positioning of a structure was important, a survey may be obtained. [45] Mr Kerry Ryan explained that the house is positioned on the first day, laser levels are taken and then the removalist goes away and makes the stumps, which are then installed several days later. [46] Mr Sean Ryan says that he received a copy of the plans from Mr Campbell on 13 October 2006 when he first attempted to deliver and position the house at Mr Campbell’s property. Because of the conclusions I have reached, it is irrelevant when Mr Campbell provided plans to KMR. Location of the removal dwelling 6 Exhibit 1 Attachment D. 7 Exhibit 1 Attachment E. 8 Exhibit 1, Attachment D page 8. 9 Exhibit 1, clauses 7 and 8, plans in Attachment D drawn by LPJ are said to have been given to KMR: the foundation plan is referred to in paragraph 10, and contained in Attachment F. -- 9 of 21 -- 10 The contract [47] The written contract requires the removalist to obtain plans. However, it is uncontroversial that the written contract was varied in that it was agreed that Mr Campbell obtain the plans incorporating two existing walls and that the removal house was to be installed incorporating the 2 block walls. [48] However, the variation concerning the plans and incorporation of the two block walls, did not otherwise affect the responsibilities of the parties under the contract. Mr Kerry Ryan did not agree to vary the contract, and the evidence of Mr Campbell himself does not go so far as to suggest, that there was agreement that KMR was to be nominated as builder and perform works in accordance with the plans. Although it is not apparent on the evidence where Mr Campbell considered his responsibilities under the plans began and KMR’s ended, Mr Campbell acknowledges that he was to do some things required by the plans. [49] Therefore, I do not accept that the plans form part of the contract documents. I am satisfied on the balance of probabilities that apart from those matters which KMR and Mr Campbell had agreed in the written contract dated 2 August 2005 and the limited oral variations later agreed to which I have referred, Mr Campbell was acting as an owner-builder. [50] That said, the contract is for the sale and delivery of a removal house. Although its terms are limited to reflect the limited extent of KMR’s responsibilities for building works related to delivery of the house on site on stumps, it involves domestic building work. The implied warranty in section 43 of the Domestic Building Contracts Act 2000 operates to require that the delivered house must comply with proper building standards and legal requirements in so far as a stumped, although not necessarily completed, house must do so. [51] The contract does not specifically require that the house be positioned in accordance with plans obtained. Indeed, the purchaser is specifically responsible under the contract for positioning of the house through marking out or pegging out where it is to be placed. As a matter of practicality, this may often be attended to by an agent for a purchaser of a removal home, namely a builder engaged by a homeowner for building works to be done following delivery. As Mr King suggested a surveyor may be engaged by a builder to precisely position a house. [52] Having regard to Mr King’s evidence, plans are not usually sufficiently detailed to indicate exactly where a house is to be positioned on a block. This sits well with the clear term of the written contract requiring the purchaser to mark out where it is to be positioned. Mr Campbell was responsible to do so. The events [53] It is uncontroversial that Mr Campbell excavated the pier footings, and shortly after advised Mr Kerry Ryan that the footings were ready. -- 10 of 21 -- 11 However, he asserts that following the difficulties which led to the delays in the house being positioned and stumped, that on Mr Kerry Ryan’s request, he filled in the footings he had dug. [54] Mr Campbell denies that he was present when the house was moved into position, stumped and the height determined. He says he was driving trucks. His evidence is that he was telephoned and asked where the house went. He says he referred Mr Ryan to the plans, as he wanted the house to be located and built in accordance with the plans. [55] Mr Sean Ryan recalls using the footings previously dug by Mr Campbell, stating that they were just cleaned out with a shovel. He says that he did not dig new footings. He also recalls Mr Campbell being on site, at least from time to time, as the delivery and stumping process occurred over about three days. He recalls Mr Campbell putting steel reinforcing beside the stumps as the concrete was poured. He understood the reinforcing was intended to support a slab that Mr Campbell intended to pour. The plans and evidence of Mr Wilkes confirm that a slab was to be poured over the existing slab. [56] Mr Wilkes had visited the site on a number of occasions and had seen the holes dug by Mr Campbell. He visited the site again in January 2007 after a call from Mr Kerry Ryan requesting a pier inspection. He said that the piers had been cleaned out, just one or two needed a bit of loose soil removed. He said he did not know if the pier holes were those same holes he had seen earlier in October 2006. He did not take any measurements, saying it was a large site, but that his perception was that they seemed to be more to the outside of the existing slab. Conclusions [57] Under the contract, Mr Campbell was responsible to mark out the position of the house. [58] For the reasons discussed earlier, I consider Mr Wilkes’ evidence about his perceptions regarding the positioning of the holes unreliable. Also, for the reasons already discussed, I consider Mr Campbell’s evidence unreliable. I prefer the evidence of Mr Sean Ryan that the original holes dug by Mr Campbell were cleaned out and used and that Mr Campbell was present from time to time in January 2007 over the days that the house was positioned and stumped. Therefore, Mr Campbell marked out the position of the house through the digging of the foundations. Therefore, the position of the house was determined by Mr Campbell, as required by the contract. [59] It follows from the findings of fact that I have made that if the house is mis- positioned by 215 millimetres, Mr Campbell is responsible. [60] Accordingly, this aspect of the claim must fail. Height of the removal dwelling -- 11 of 21 -- 12 [61] In effect Mr Campbell says that the height of the building is not in accordance with the contract, because it does not comply with the plans. [62] The height to which the house was to be stumped was specified in the written contract signed by the parties as set out earlier. However, by arrangement stumps of additional height would be provided by the removalist at extra cost under the contract. There is no oral agreement alleged to vary the height of Mr Campbell’s house from the standard height under the contract. [63] Mr Sean Ryan recalls that at the time the house was in place and ready to be stumped, he and Mr Campbell together measured the height of the house. He says that it was measured at 2.7 metres from the concrete to the bottom of the timber beam at the highest point of the house (the back corner). He said it was measured according to the contract and that Mr Campbell expressed no concerns about the height. [64] The plans provide for 2,600mm from floor level to underside of the ceiling. The height required to achieve the height specified is not specified in the plans, since the thickness of the slab and the height at which the ceiling is to be placed vis-a-vis the underneath of the upstairs floor is not specified. Mr Wilkes says he measured the height as required by the plans. He clarified in oral evidence that he measured the distance from the old slab to the underside of the new steel channels. He determined that the height varied from 2,470 to 2,540 millimetres. Neither Mr Adams nor Mr King measured the height. Conclusions [65] For the reasons already discussed, I do not accept that the plans form part of the contract documents. The height to which KMR was required to stump the house was specified in the written contract, although clearly Mr Campbell could have requested a variation at the additional cost specified. There is no suggestion that any variation was sought by Mr Campbell. [66] I note that the plans do not specify the overall height that might be required to achieve what is planned. Any calculations to be done regarding any additional height required to achieve the height specified in the plans were to be done by the person responsible for carrying out the overall building works. In this case given the findings I have already made, that responsibility lay with the owner-builder, Mr Campbell. [67] Mr Wilkes’ measurements were taken to the underneath of the steel beams as opposed to the original wooden beams of the house which were the only beams at the time of the contract. The steel beams were installed after the contract was formed, and there was no variation sought for the height of the building to be varied such that the height would be measured to the underside of the steel beams. -- 12 of 21 -- 13 [68] Preferring the evidence of Mr Sean Ryan to Mr Campbell’s evidence for the reasons already discussed, I am satisfied that Mr Sean Ryan, with Mr Campbell, measured the height at 2.7 metres at the highest point measuring from the bottom of the timber beam to the concrete. [69] Therefore, I accept that the height at the highest point of the house measuring from the bottom of the timber beam to the concrete is 2.7 metres. The contract required that the maximum height of the posts was 2.7 metres. It was not varied. Accordingly, I am satisfied that the house was placed at the height required by the contract. [70] Therefore, this aspect of the claim must fail. Demolition of the existing dwelling [71] Mr Campbell claims that the ground floor block walls, kitchen and bathroom were demolished and must be rebuilt. He claims the costs of doing so from KMR. The Events [72] The contract specifies that the purchaser must provide clear and trafficable access to the site and assistance required by way of trucks or tractors. Mr Kerry Ryan agreed to the variation whereby two block walls would be incorporated because of the purchaser’s responsibilities to prepare the site. [73] Mr John White assisted Mr Campbell to prepare the site for delivery of the removal house. His evidence is that they dismantled an old structure on the block over a couple of weeks. He says they removed the kitchen from the old dwelling to enable the truck to gain access. As he recalls, it was removed in three pieces without too much damage. He understood that Mr Campbell then stored it. [74] Two block walls were left standing to be incorporated in the dwelling. Mr Kerry Ryan says he advised Mr Campbell about a month before delivery that an earth ramp was required for the truck to gain access to the house and that he needed to place fill on the slab so that the house would clear the walls. [75] Mr Campbell’s evidence was to the effect that he understood that the house would be positioned by crane, and that Mr Ryan only contacted him shortly before delivery to tell him that he intended to position by trailer. Under cross-examination he admitted that he knew KMR always used a trailer, and he had not known KMR to use a crane on any occasion. He also says that it was only when Mr Sean Ryan arrived with the house on 13 October 2006 that he determined that the trailer used by KMR was not capable of lifting the house sufficiently to locate the house over the existing structure. He says he was dumbfounded that an earth ramp was demanded at this stage. -- 13 of 21 -- 14 [76] It is uncontroversial that the house was temporarily unloaded adjacent to the site. [77] Mr Campbell says that during the placement of the soil fill over the concrete, soil was being compacted next to one of the besser block walls and the wall fell over. Mr Wilkes attended at the site on 20 October 2006. He observed that one block wall had fallen over. The remaining block wall was standing, but leaning. He did not believe it required demolition, just propping. Photographs10 tendered through Mr Wilkes were said to show the site as he saw it on 20 October. They show the wall which fell over, and parts of another wall standing. There is no visible concrete reinforcing, although Mr Wilkes said that the wall which remained standing had reinforcing. [78] Mr Sean Ryan attended the premises again after receiving notice that the ramp and soil works were done. However, he considered the site to be unsafe because of concerns about the stability of the two walls on the site, in light of the collapse of one of them. He telephoned Mr Kerry Ryan who then attended. [79] Mr Kerry Ryan inspected the walls. He says that they did not have steel reinforcing. He considered them liable to collapse. He arranged for an inspector from the Department of Industrial Relations to attend the site, who subsequently issued a Prohibition Notice to the person controlling the area to stop performing work duties in close proximity of the block wall, because of the risk of injury due to risk of collapse. [80] Subsequently, Mr Campbell arranged for the demolition of the walls and septic facility. He says that this was done on Mr Ryan’s request. He claims this was only necessary because Mr Ryan did not properly assess the site prior to delivering the dwelling. Mr Kerry Ryan says that he did not make these requests. [81] Mr Wilkes says that he had assumed when preparing the initial structural drawings that the concrete masonry walls would be left intact and the removal residence installed by crane or by jacking on site. He considered them to be structurally sound. However, he says that it became evident that the trailer would not raise high enough to lift the building above the existing walls, leading to the removal of several courses from the existing walls, although he says this was difficult due to steel-reinforcing in the wall. Ultimately, he considers this led to demolition of the walls. Mr King’s evidence is that the walls were not suitable for incorporation into a habitable dwelling. [82] Mr Adams considered it more appropriate for KMR to be responsible for an earth ramp: a purchaser would otherwise have to know what they are doing. Mr King said that providing an earth ramp was often an owner’s responsibility. 10 Exhibit 8. -- 14 of 21 -- 15 Conclusions [83] Under the contract, the purchaser is responsible for the preparation of the site for delivery of the removal house, because the purchaser must provide clear and trafficable access. This intent is clear. Was this altered by the agreed variation to the contract to set the house on two existing walls? Does providing clear and trafficable access include the provision of an earth ramp? [84] There is no evidence to suggest that this term of the contract was altered when the contract was varied for the house to be set on the two block walls. On the contrary, Mr Kerry Ryan says he had no concerns about accepting it because of the term. Hence, any additional costs associated with it would be met by the purchaser. Otherwise, it is reasonable to infer, that Mr Ryan would have required an additional price before agreeing to the variation. [85] Despite Mr Adams assertions that construction of an earth ramp was more appropriately done by KMR, Mr Campbell had responsibility to prepare the site whatever was required. He was not only a purchaser, but also an owner-builder. [86] Mr Campbell does not dispute that Mr White assisted him to prepare the site, including dismantling the old structure leaving the two block walls. [87] As earlier discussed, Mr Campbell’s evidence was inconsistent and I prefer the evidence of Mr Kerry Ryan and Mr Sean Ryan about the manner in which events transpired around the delivery of the removal house. I am satisfied that Mr Campbell had been advised that the house was to be delivered on a trailer, not lifted by a crane and that he failed to prepare the site to accommodate this and, later when he attempted to do so in accordance with his obligations as purchaser under the contract, one of the walls fell over. Mr Campbell himself had the block walls and the septic system demolished following the issue of the Prohibition Notice. Accepting Mr Ryan’s evidence in preference to Mr Campbell’s, I am not satisfied that Mr Kerry Ryan requested the demolition. [88] I accept Mr King’s evidence that the two walls demolished were not structurally sound and therefore unsuitable for incorporation into a habitable dwelling. Mr Wilkes had inspected them and considered otherwise. However, it is undisputed that one of them collapsed while Mr Campbell was compacting soil next to it . This is not consistent with a structurally sound wall. [89] KMR had limited responsibilities under the contract, and although there was an oral variation to incorporate the two block walls, KMR had no responsibility for their structural soundness. There is no basis that I can discern for any claim that because the house ultimately did not incorporate the two walls, KMR is responsible for the costs of rebuilding them, let alone that it should be responsible for compensating Mr Campbell for rebuilding other parts of the dwelling which previously stood -- 15 of 21 -- 16 on the block prior to the site being prepared for the removal house. It is not suggested that at any time KMR or its agents damaged the block walls and septic system, let alone the kitchen and bathroom in respect of which this claim is also made. [90] This aspect of the claim can not succeed. Gable end walls [91] The contract specified that the gable walls were to be redone at each end. The materials to be used were not specified. Mr Kerry Ryan says that the agreement was that the gable ends were to be constructed of hardiflex. [92] Mr Campbell contends that they were to be blue board. There is no evidence to suggest that there was an oral variation discussed between Mr Kerry Ryan and Mr Campbell regarding the materials to be used. Mr Campbell relies upon the plans as specifying blue board as the material to be used. [93] Mr Campbell acknowledges that the end gables were constructed in about June 2007 of hardiflex. Conclusions [94] I accept Mr Kerry Ryan’s evidence that the agreement reached at the time the written contract was signed was that the gable ends would be hardiflex. I find that this constituted an oral term of the contract. [95] The plans, when they were drawn some 8 months later, designated that the end walls (and some other walls of the downstairs floor) be constructed from blue board. It makes logical sense that blue board ends may then have fitted better with the concept that had been developed in the plans for the finished home. It is reasonable to infer that the concept of blue board for the wall ends emerged at the time that the plans were drawn. On the evidence, I am not satisfied that there was any agreement about blue board ends at any time. Further, as I have already found, the plans did not form part of the contract. [96] The gable ends were constructed with hardiflex as required by the contract. Accordingly, KMR fulfilled its contractual obligations. [97] Accordingly, this aspect of the claim must fail. Damage to external cladding [98] It is uncontroversial that the contract provides for KMR to fix any structural damage caused during transit and during KMR’s building works. The Cladding [99] It is common ground that the rear cladding to the house was damaged. -- 16 of 21 -- 17 [100] Mr Adams reports that, from photographs, he established that when the house was at Minden, the rear aluminium cladding had some dints and damage to about the bottom 4 rows of cladding, and that there were 4 rows of cladding over the window heads. However, later photographs of the house outside Mr Campbell’s property show only 2 rows of cladding over the windows and some of the remaining section was no longer in place. Correspondence from the Rosalie Shire Council also records that in December 2005, the external cladding appeared to be in good condition. [101] Photographs show considerable damage to the cladding. Mr Adams report suggests that a removal house is made up of structural components which are all structural in nature, and cladding plays an important part of keeping weather out and maintaining a sound structure. However, his oral evidence was to the effect that the outer layer was not structural, but that the damage to the internal layer may be structural. He conceded that it was for a structural engineer to determine if the damage was structural. [102] Mr King expressed the view in his report that it is well accepted in building and engineering industries that ‘structural’ refers to ‘load bearing framing members’, not cladding. In this instance, Mr King said the internal cladding which was fibro sheeting may have bracing capacity on the house, although no calculations had been done of its bracing capacity. He considered that the holes in the cladding did not compromise bracing capacity, whereas more or larger holes may do. He described the holes as serious superficial damage, but not structural damage. Conclusions [103] I am satisfied on the basis of Mr Adams evidence and the Rosalie Shire Council documentation about its state when inspected, that the rear cladding was damaged during transit of the removal house. [104] Mr King relied only on photographs to express his view that the damage was not structural. However, for the reasons earlier discussed, I accept his expert opinion. Therefore, I am not satisfied that the damage to the cladding during transit was structural. [105] This aspect of the claim must fail. Roof-sheeting and roof void The Contract [106] The contract required that a new roof be installed. It was initially agreed orally that a corrugated iron roof be installed, but later the agreement was varied, so that KMR was to install a colour-bond custom orb roof. [107] The contract makes no provision for closure of the roof void. On the contrary, under the contract, on delivery the purchaser becomes -- 17 of 21 -- 18 responsible for security of the building and responsible for damage except in respect of damage caused by KMR in the course of its building activities. The Events [108] Mr Kerry Ryan says that KMR provided new roof gutters and brackets and a colour-bond custom orb roof, in accordance with the contract as varied. He engaged a licensed plumber as a roofing contractor to install it. [109] Installation is not disputed by Mr Campbell. However, his evidence about the roof and related events is otherwise contradictory. Mr Campbell says he noticed feral pigeons in the roof after its construction. In his written statement he says that a section of the portico above the front door was not replaced and that the pigeons occupied the roof void from October 2006 to June 2008 when it was plugged. However, in oral evidence, he said that he thought one of the first things he did was get the pigeons out. [110] Ultimately, he asserted that his written statement must be correct as it was written earlier, indicating that his memory was now unclear. In his written statement he says that in June 2008, he personally removed 6 sheets of custom orb. He says that he noticed the skylight was loose; that the W41 ties were not installed according to the plans; that battens were missing and the insulation was full of pigeon droppings. However, under cross-examination he said that he had not removed roof sheeting. [111] A neighbour of Mr Campbell’s property, Mr Richard Hails, gave evidence about events observed by him, he thought, in about 2006. He saw Mr Campbell and what appeared to be 2 teenage boys remove the roofing iron from the house over several weekends, and then remove the ceiling insulation. Although he was unable to be precise about the dates, he was clear that these actions were taken in respect of the removal house, not the previous dwelling. [112] Mr Campbell made complaints to the QBSA. He initially complained in about September 2007, and says that from that time until October 2009 he was in dispute with the QBSA which he wanted to require KMR to rectify the premises. [113] Some correspondence about the complaints was available to the Tribunal. The 2007 complaint apparently referred to a large number of alleged defects, but only one related to the roof, namely that gutters were not installed on the eastern side of the building.11 The BSA required some limited rectification, namely installation of gutters on the eastern side of the building.12 [114] On 6 June 2008, a further QBSA direction issued to the effect that the roof sheeting was not fixed to the top roof batten for the full length of the ridge 11 Exhibit 1, Attachment 11. 12 Exhibit 1, Attachment L. -- 18 of 21 -- 19 and tie down had not been completed in accordance with W41 wind loading.13 Subsequently, in 2009, a direction was issued requiring installation of a continuous batten on the north-eastern corner of the roof; re-falling the gutters to avoid ponding; affixing the roof sheeting in accordance with manufacturer’s specifications; and installing binders and insulation to the gable ends.14 [115] Following the BSA complaints, Mr Kerry Ryan inspected the premises on several occasions. He says he observed that bracing had been placed on some stumps and over-tensioned to the extent that the stumps had bent, which he considered likely to cause the gutters to bow and water to pond. Further, he says he observed that roof sheeting had been removed and not replaced correctly and some roof screws not replaced correctly or at all. He says there were loose screws all over the roof. The skylight had been damaged post installation and a vent pipe incorrectly installed allowing water to run directly into the house. [116] He said that he performed rectification as required by the BSA, even though he did not consider the defects were KMR’s responsibility. It is not apparent from the evidence when the rectification was done following the 2009 direction. Documents before the tribunal confirm that an extension to complete the rectification was granted until the end of January 2010. However, the QBSA did not request to reinspect until May, 2012. [117] Mr Adams inspected the roof on 3 February 2010 and found numerous deficiencies with the construction of the roof, including ridge-capping not properly installed and damaged, battens incorrectly located, many loose screws, badly dinted roof sheeting which has holes and significant surface damage, the skylight is loose. He comments also that some insulation is missing and some is damaged, and that there are pigeon droppings throughout the roof void. He refers to earlier building inspection reports not identifying any pigeon droppings or infestation at the Minden yard. Mr King agrees that the roof is not in a satisfactory condition. Conclusions [118] It is apparent on the terms of the contract that sale of the removal house is ‘as is’, except as specified in the contract. A new colour-bond custom orb roof was required to be provided. There is no contractual requirement for KMR to provide new insulation in the roof void. [119] In my view, on a proper construction of the contract, the assumption of risk for the house and securing of the building, passed to the purchaser from the time of delivery. Therefore, Mr Campbell was the person responsible for closing of the roof void after delivery. He did not do so, he says, until June 2008. Whether or not, the pigeons moved in at Minden or after the house moved to Mr Campbell’s site is irrelevant in my view. 13 Exhibit 16. 14 Exhibit 17. -- 19 of 21 -- 20 There is no basis for KMR to be liable. There has been no breach of contract for failure to close the roof void. [120] A new colour-bond custom orb roof was required to be installed by KMR under the contract. [121] The house was not delivered until early 2007. Mr Campbell began to complain to the QBSA in 2007. In my view, it is telling, that the only initial complaint about the roof related to guttering not being installed on the eastern side of the dwelling. The QBSA required some limited rectification, for the installation of the missing guttering which was attended to by KMR. It is not apparent on the evidence what prompted the direction to rectify dated 6 June 2008. However, for the direction to issue in early June 2008, it is reasonable to infer that the QBSA inspected the roof earlier than June. Apparently the roof was not at that stage in the poor state it was at the time that the QBSA issued the 2009 direction requiring some broader rectification of the roof. It is also not apparent on the evidence when the work was done in compliance with the 2008 direction to rectify. [122] Mr Campbell says that it was in June 2008, that he cleaned out the pigeons and that this is when he saw the damage to the roof. Given Mr Campbell’s equivocal evidence about the date on which he did this, I am not satisfied that June 2008 is an accurate reflection of when he worked on the roof. [123] I accept the evidence of Mr Hails that Mr Campbell and two young persons removed the roof sheeting and then the insulation. When pushed Mr Hails thought it may have been in about 2006 but could not be precise about the year, although he knew the actions were taken in respect of the removal house. Mr Hails did not pretend that he could be precise about dates this long after the events he observed, which were after all was of no particular consequence to him personally. [124] Having regard to the sequence of complaint to and directions issued by the QBSA, as well as the evidence of Mr Hails, I am satisfied that it was sometime in 2008, that Mr Campbell, who has no qualifications in roofing, did clear the pigeons out and that was when Mr Hails observed him. It is reasonable to infer, and I draw the inference, when he did so, he and the two teenagers who assisted him removed the roof sheeting and insulation, and then reassembled the roof in an amateur manner, causing damage to the sheeting in the process. It was not reaffixed by them in a tradesman like manner or in accordance with manufacturer’s specifications. [125] Therefore, I find it more likely than not that when the QBSA inspected the roof and roof void and made directions in 2009 about rectification of the roof, that the work inspected was that of Mr Campbell and his assistants, not the work of KMR’s contractors. [126] Further, in respect of the 2009 direction to rectify, the works were to be completed by 25 January 2010 although the evidence does not indicate -- 20 of 21 -- 21 when it was actually done. Given that the QBSA request to reinspect was not made until May 2010, it is reasonable to infer that the rectification was not done until later than January 2010. [127] On the evidence, I am not satisfied that at the time Mr Adams inspected the roof on 3 February 2010 that the rectification works required by the 2009 direction had been done. Mr Adams considered the state of it generally unsatisfactory for a new roof. What he saw was consistent with what Mr Kerry Ryan describes as the state of the roof and photographs he took when he then went back to the site. I conclude that Mr Adams inspected the work done by Mr Campbell and his assistants. [128] On the evidence I am not satisfied on the balance of probabilities that KMR or its agents are responsible for the state of the roof at the time it was inspected by Mr Adams. Further, I am not satisfied that there has been a breach of contract by KMR resulting in the claims made in this proceedings about the condition of the roof. [129] Therefore, this aspect of the claim must fail. Orders [1] As all aspects of the claim fail, the application is dismissed. [2] Any application for costs and supporting submissions be filed in accordance with the directions made. -- 21 of 21 --