Akhavan v Queensland Building and Construction Commission and Anor [2026] QCAT 361

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL CITATION: Akhavan v Queensland Building and Construction Commission and Anor [2026] QCAT 361 PARTIES: ARTIN AKHAVAN (applicant) v QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION (first respondent) ICONIC LINE CONSTRUCTIONS PTY LTD (second respondent) APPLICATION NO/S: GAR239-24 MATTER TYPE: General administrative review matters DELIVERED ON: 5 August 2026 HEARING DATE: 13 March 2026 HEARD AT: Brisbane DECISION OF: Member Lambie ORDERS: The first respondent’s decision of 4 March 2024 is set aside and substituted with a decision that its decision of 10 January 2024 is confirmed. CATCHWORDS: GENERAL ADMINISTRATIVE REVIEW – PROFESSIONS AND TRADES – BUILDERS – INTERNAL REVIEW OF DECISION A DOMESTIC BUILDING CONTRACT HAS BEEN VALIDLY TERMINATED – CONTRACTS – DISCHARGE, BREACH AND DEFENCES TO ACTION FOR BREACH – where initial decision that contract was terminated at the default of the builder – where internal review finds mutual termination or abandonment – where the applicant brings an application to review the decision Queensland Building and Construction Commission Act 1991 (Qld), ss 67WA, 85A, 86, 87, Schedule 6 Queensland Civil and Administrative Tribunal Act 2009 (Qld) ss 17, 20 Agropolou v Shkolyar (Domestic Building) [2011] VCAT 2213 Cedar Meats (Aust) Pty Ltd v Five Star Lamb Pty Ltd [2013] VSC 164 CGM Investments Pty Ltd v Chelliah [2003] FCA 79 -- 1 of 18 -- 2 Imam v Life (China) Company Limited [2023] QCA 19 Mareva Building Consultants v Zevon and Zevon [2013] ACTACA 28 Ryder v Frohlich [2004] NSWCA 472 Torua v Sariklis (Domestic Building) [2012] VCAT 144 Yan v Brown Bros Cabinet Work Pty Ltd (Domestic Building) [2013] VCAT 1623 APPEARANCES & REPRESENTATION: Applicant: Y Furgan, instructed by Gibbs Wright Litigation Lawyers First Respondent: Second Respondent: N Congram, instructed by K Steward, Queensland Building and Construction Commission Self-represented REASONS FOR DECISION [1] This is an application for review of a decision of the first respondent (‘the QBCC’ or ‘the Commission’) of 4 March 2024 (‘the Decision’), which set aside its decision of 10 January 2024 (‘the Original Decision’) that a contract between the applicant and the second respondent had been validly terminated at the default of the second respondent. The Decision was that the contract had been mutually terminated or abandoned and that, therefore, the applicant’s claim against the statutory insurance scheme was disallowed. [2] The applicant seeks an order that the decision be set aside and replaced with a decision that he validly terminated the contract. Background [3] The applicant, Mr Akhavan, is a joint owner of the property located at 16 Page Street, Everton Park. On 21 June 2022, he and the second respondent (‘the Builder’) entered into a contract for the construction of a new home at the property for a price of $951,966. [4] The deposit amount under the contract was $47,598, which was paid in four instalments between July and October 2022. [5] On 9 May 2023, the Builder obtained building approval for the works. [6] On 15 May 2023, the Builder issued a variation (referred to the evidence as Variation 4) to Mr Akhavan, purporting to increase the contract price by $253,265. [7] Mr Akhavan and the Builder met on 11 July 2023 to discuss the variation and corresponded on the issue until about 29 August 2023. [8] On 8 August 2023, Mr Akhavan submitted a complaint to the QBCC seeking assistance for the return of the deposit on the basis that work had not started at the property. This commenced a claim under the statutory insurance scheme under the Queensland Building and Construction Commission Act 1991 (Qld) (‘the QBCC Act’). -- 2 of 18 -- 3 [9] Mr Akhavan’s solicitors wrote to the Builder between 13 September 2023 and 1 November 2023. These letters were: (a) a demand of 13 September 2023 that the Builder commence the works within 20 business days, to which the builder did not respond; (b) a notice to remedy breach dated 13 October 2023, requiring the builder to rectify its substantial breach of the contract by commencing the works within 10 business days; and (c) a letter of 1 November 2023 terminating the contract with immediate effect. [10] On 10 January 2024, the QBCC made the Original Decision and the deposit amount was paid to Mr Akhavan. [11] On 4 March 2024, the QBCC made the Decision, which set aside the Original Decision. Issues for determination [12] The parties have agreed that the issues for determination are: (a) Is Mr Akhavan a ‘consumer’ as defined in s 67WA of the QBCC Act? (b) If so, is the contract between Mr Akhavan and the Builder a ‘fixed price residential contract’ as defined in ss 2 and 3 of the terms of cover in Schedule 6 of the Queensland Building and Construction Commission Regulation 2018 (Qld) (‘the QBCC Regulation’)? (c) If so, did Mr Akhavan and the Builder terminate the contract on or about 13 July 2023 by mutual agreement or abandonment? (d) If not, did Mr Akhavan validly terminate the contract on or about 1 November 2023 on the default of the Builder? (e) As a consequence of (a) to (d) above, should Mr Akhavan’s claim under the statutory insurance scheme in the QBCC Act and Regulation be allowed or disallowed? [13] At the hearing, the parties agreed that it was not in issue between them that Mr Akhavan was a ‘consumer’ and that the contract was a ‘fixed price residential contract’. The issue for determination, therefore, is when and how the contract ended. The Commission conceded that, if the contract was not mutually terminated or abandoned at some time between 11 July 2023 and the end of August 2023, the contract was validly terminated under the process described in paragraph [9] above and the Original Decision should stand. Evidence The factual basis for the Decision [14] The Builder’s letter to the commission seeking internal review, dated 7 February 2023, made the following claims: (a) it was confirmed that no work had commenced on the property prior to the mutual termination of the contract; -- 3 of 18 -- 4 (b) Mr Akhavan requested 27 variations to the original drawings and specifications which resulted in increased costs associated with the construction of the property; (c) the Builder issued the proposed variation document in accordance with the contract due to the changes made in the design process, which Mr Akhavan refused; (d) on or about 11 July 2023, Mr Akhavan met with the Builder and at the meeting the parties agreed to mutually terminate the contract; (e) Mr Akhavan requested the CAD files and the ‘Revit files’ to engage with another Builder or, alternatively, to sell the land to another person with the designs available to be used by a subsequent owner; (f) on or around 13 July 2023, in reliance on the claimed mutual termination agreement, the Builder released all the CAD files associated with the property to Mr Akhavan; (g) on 17 July 2023, Mr Akhavan requested the Revit files and confirmed that the copyright associated with the construction plans had been transferred to him; (h) on 26 July 2023, Mr Akhavan wrote to the Builder confirming the transfer of the copyright of the plans and specifications; (i) on or about 3 August 2023, the Builder attempted to confirm that the contract had been mutually terminated and that it was no longer completing the construction of the property; and (j) following this communication, Mr Akhavan issued the notice to remedy breach and termination notice. [15] The Commission cited the following summary of facts as material to the Decision: (a) Mr Akhavan had made the appropriate payments under the contract. (b) On 15 May 2023, the builder issued the variation proposal to Mr Akhavan citing increased costs to building supplies and materials due to increased demand as a result of market changes as the basis for the variation1. (c) On or around 11 July 2023, Mr Akhavan met with the Builder’s representative. At the meeting, the parties allegedly agreed to mutually terminate the contract. At the meeting, Mr Akhavan requested the CAD files and the Revit files be released for use by him to engage in new builder or, alternatively, for a subsequent purchaser of the property to undertake the works. (d) On or around 13 July 2023 “in accordance with the mutual termination agreement” the Builder released the CAD files to Mr Akhavan. (e) On 17 July 2023, Mr Akhavan requested the Revit files and confirmation that “copyright associated with construction plans had been transferred” to him, 1 Note that the QBCC did not accept the Builder’s claim that the proposed variation was occasioned by Mr Akhavan’s requests for variations to the drawings and specifications. See paragraphs 83 – 88 of the QBCC’s Decision Notice, HB 16 – 17. -- 4 of 18 -- 5 stating “as discussed, these drawings and associated files may be used by either [Mr Akhavan] or another owner to build at Page St.” (f) there was a disagreement between the parties with respect to the “costs associated with the project to date”. (g) On 3 August 2023, the Builder sent correspondence to Mr Akhavan stating that the contract had been mutually terminated and, further, that the Builder was no longer completing the construction of the dwelling at the property. (h) On 13 September 2023, Mr Akhavan, though his solicitors, advised the Builder that: (i) the variation proposal had been rejected; (ii) he was seeking a refund of the unused portion of the deposit; (iii) he was ready, willing and able to comply with his obligations under the contract; (iv) in circumstances where the Builder was “unable or unwilling to proceed with the contract for the contract price, then [Mr Akhavan] may consider a mutual termination of the contract, on the condition that [the Builder] agrees to grant a licence to [Mr Akhavan] to use the plans”; and (v) there was never a mutual termination or abandonment of the contract and that Mr Akhavan’s request was that the Builder “withdrew their price increase and commit to [their] contractual obligations within the specified timeframe.” The Decision [16] The Commission gave weight to the Builder’s submission that: (a) by the “mutual termination” agreement, it was agreed that the Builder would release the CAD and Revit files; and (b) in accordance with that agreement, the files were subsequently released to Mr Akhavan, which amounted to confirmation that the contract had been mutually abandoned prior to Mr Akhavan issuing the notice to remedy breach and, subsequently, the termination notice. [17] The Commission was satisfied that there were sufficient reasons on the evidence to find that the Builder’s and Mr Akhavan’s “external manifestations evince an intention to abandon” the contract. [18] The Commission found that the conduct of the parties was categorically inconsistent with each of the parties performing their outstanding requirements under the contract, because of: (a) the statements made by Mr Akhavan (on around 11 July 2023) when he requested the drawing plans from the Builder, which objectively raised the possibility that he would either be continuing the build with another contractor, or provide to a subsequent purchaser of the property; and (b) the statements made by the Builder (on around 3 August 2023) in relation to the proposed variation, namely that at that time any costings previously submitted -- 5 of 18 -- 6 had become irrelevant given that the Builder was no longer performing the works under the contract for Mr Akhavan. [19] The Commission also considered that, objectively, the parties intended for an entity other than the builder to undertake the works. [20] Accordingly, the Commission was satisfied that the notice to remedy breach and termination notice were invalidly issued because the contract had already been mutually abandoned through the parties’ conduct on or around 11 July 2023. [21] Section 4 of the QBCC Regulation provides that a valid termination for a fixed price residential contract does not include mutual abandonment of the contract by the parties to the contract. Therefore, the Commission determined that the contract was not validly terminated at the default of the Builder and that Mr Akhavan’s claim under the statutory insurance scheme be disallowed. Mutual termination or abandonment: Mr Akhavan’s evidence [22] Mr Akhavan’s statement of 11 October 2024, in relation to the events of 13 July 2024 and following, is: (a) He attended the meeting with the Builder on 11 July 2023, accompanied by Leila Aria. The representatives of the Builder in attendance were Mr Suyatno, Mr Joliffe and Ms O’Brien. (b) He demanded that the Builder withdraw Variation 4 and commence construction of the works as soon as possible. (c) Mr Suyatno said that the Builder would not withdraw the variation and could not proceed with construction for the contract price because it would cause the Builder to suffer a substantial loss on the project. (d) Mr Suyatno said that Mr Akhavan should attempt to sell the property with the approved plans so that a prospective purchaser could construct the works with the builder for the contract price plus Variation 4. (e) Mr Akhavan recalls that he was not interested in this proposal and wished to proceed with the works. He said that he would only consider a mutual termination of the contract if the Builder: (i) refunded the entire amount of the deposit to him; and (ii) provided express permission for him to use the plans so that he could either engage a new builder or sell the property with the approved plans included as part of the sale. (f) Mr Suyatno replied: (i) the Builder could not refund the entire deposit, and would only consider a partial refund; (ii) he would provide Mr Akhavan with an update in about five days as to the Builder’s costs to date and any partial refund that might be offered, and whether the builder would permit him to use the plans. (g) Mr Akhavan left the meeting after this exchange. He claims that, upon leaving the meeting: -- 6 of 18 -- 7 (i) the belief the contract was still on foot; (ii) he had not agreed to any final terms with the Builder to mutually terminate the contract; and (iii) the only item that was agreed at the meeting was that the Builder would provide him with their costs incurred to date. (h) On 13 July 2023, following the meeting, he received an email from the builder which contained a copy of the drawings for the works. (i) On 17 July 2023, he sent an email to the builder in which he requested confirmation from the builder as to whether he was permitted to use the plans in future. He received no response. (j) On 20 July 2023, he sent an email to the Builder requesting an update as to its costs to date for the works. (k) On 26 July 2023, having received no response he sent a further email to the builder in which he stated that he considered the actual costs of the works to date were approximately $13,205. (l) On 29 July 2023, he received an email from the Builder which included a list of additional expenses it claimed to have incurred for the works. (m) On 31 July 2023, he sent an email to the Builder in which he stated that he required: (i) a refund of at least $27,128; (ii) the Builder to pay any fees for the building approval for the works; (iii) the Builder to transfer the building approval to him; and (iv) a response by close of business on 2 August 2023. (n) On 3 August 2023, there was an exchange of emails, as previously described. (o) On 27 August 2023, he received an email from the Builder which enclosed a bundle of invoices the Builder claimed to have paid towards the works. (p) On 28 August 2023, he sent an email to the Builder which disputed his liability to pay for the invoices and reiterated his demand for refund of the deposit and release of the building approval to him. (q) On 29 August 2023 at 11:55 AM, he sent an email to the Builder stating that he would require a refund of the deposit and release of the building approval to him. (r) On 29 August 2023 at 12:37 PM he sent a further email to the Builder and requested a meeting to discuss a possible settlement of the dispute. There was no response to this email. [23] At the hearing, Mr Akhavan stated that no agreement was reached at the meeting of 11 July 2023 that the contract should be terminated. His evidence was that the purpose of the meeting was to have the builder withdraw Variation 4. He said that, when it became clear to him that the builder had no intention of withdrawing the variation, he was prepared to discuss termination on two conditions: a full refund of the deposit and -- 7 of 18 -- 8 release of the drawings. He said that those conditions were never met. It was put to him in cross-examination that he was given express verbal permission at the meeting to use the drawings. He said that that would never have been sufficient and that express permission would need to be in writing. It was suggested to him that the builder’s agreement to release the drawings to him is in accordance with his proposal. He said that the drawings were of no use to him without written permission. [24] Mr Akhavan accepted that he received the drawings on 13 July 2023 but that they came without any written permission to use them. [25] He was taken to his email of 17 July 20232 , in which he said: Thank you for releasing the drawings as it was agreed in our last week’s meeting. May you please release the Revit files as well, in case the buyer wants to make any change to the current plan. As discussed, these drawings and associated files, may be used by either by me or another owner to build at Page St. If you oppose this, please let me know by COB 19 th July 2023. Otherwise, it will be taken and understood that Iconic Line Construction acknowledge the transfer of the copyright to me and any third party to build at this address. [26] He said that the paragraph as to the use of the drawings was to prompt the Builder to provide the written permission he was seeking, or to confirm the Builder’s understanding use to which the drawing could be put. [27] He was taken to his email of 26 July 20233 , in which he wrote, “I confirm again that I received the drawings and BA for the dwelling and since I received no objection by the due date given about the release of the copyright, it is considered that the copyright has been transferred to us (the client).” He told the Tribunal that this was a further attempt to “put the words into [the Builder’s] mouth, but they never confirmed it.” It was put to him that the email confirmed that at least one of his conditions had been met. He said that he did not agree and that his attempts to secure agreement on the two conditions went nowhere. He said that it was not his understanding that the copyright in the drawings had been transferred. [28] Mr Akhavan was asked why, in that email, he had made no reference of any continuation of the works. He said that, at the meeting, the Builder had made it clear that it did not intend to start work within the terms of the contract as written. He said that he was not prepared to walk away from the contract without satisfaction of the two conditions he had proposed. [29] It was put to Mr Akhavan that, in his email of 31 July 20234, he had provided a breakdown of the amount of the deposit he was seeking to have returned but, having not mentioned the permitted use of the drawings, had accepted that his condition in that respect had been met. He did not agree and stated that he had already tried twice without receiving a response. [30] Mr Akhavan was taken to his email of 3 August 2023, and which he wrote: 2 HB 464. 3 HB 113. 4 HB 111. -- 8 of 18 -- 9 Since I have not received any objection to my below email and calculation of the actuals and refundable by the due date of yesterday 2nd August, it is considered that it is all accepted by Iconic. To show the goodwill again, I expect to receive the refunds of $27,178 in my account by COB 11th August. [31] Mr Akhavan told the Tribunal that, as with the copyright in the drawings, he was attempting to hasten the Builder’s response to his proposals and, he hoped, to secure an agreement. However, his proposals were never accepted by the Builder. [32] Mr Akhavan was taken back to his email of 17 July 2023 (see [25] above) and was asked about his reference to “the buyer”. He said that the reference was hypothetical because the property had not been put on the market. He said he was considering all options at that time, given that he could not afford the amount claimed in Variation 4. He was therefore casting around for a way to proceed. [33] Mr Akhavan was asked when he had decided to engage a different builder. He said it was after he had given the notice of termination. He said that he had not landed on an option before then because his principal concern was obtaining finance for the project. Before the notice of termination, he had only gone as far as making enquiries and could not go further because the position with his finance was not settled. Taken to the letter from his solicitors of 19 October 20235, which, in relation to the drawings, states: “You may wish to … provide them to your new builder to confirm you are able to use them,” he told the Tribunal that a builder had not been engaged at that point and that the advice referred to a future situation. Similarly, he said, his solicitor’s letter of 1 November 20236 which stated,” our clients intend to engage another builder to carry out the Works” reflected the fact that he had, at that time, received proposals from builders but his finance was still not settled and so any intention to engage another builder was a contingent one. Mutual termination or abandonment: the Builder’s evidence [34] Mr Roy Suyatno, the Builder’s project manager, gave evidence for the Builder. In his statement of 22 November 2024, he claimed: (a) Despite the contract being executed by the parties on 18 June 2022, final plans were not issued until 13 March 2023 because of the numerous design changes requested by Mr Akhavan. (b) The final certified construction plans and engineering were approved on 9 May 2023. (c) On 15 May 2023, the builder wrote to Mr Akhavan to advise of the cost increases. Mr Akhavan responded by email on 16 May 2023 requesting an urgent meeting to discuss the matter. (d) The meeting took place on 11 July 2023. Present were Mr Akhavan and, for the Builder, Mr Suyatno, Alan Joliffe (salesperson) and Ebony O’Brien (contract administrator). (e) Mr Suyatno’s account of the meeting was: 5 HB 278. 6 HB 282. -- 9 of 18 -- 10 (i) The Builder’s representatives explained that the reason for the price increase was due to building design changes made by Mr Akhavan, the requirements to enable approval, and the time it took for the approval to be provided. (ii) Mr Akhavan advised that he would potentially need to sell the property. (iii) Mr Akhavan said that he was not satisfied with the price increase. (iv) Mr Akhavan threatened to sue the Builder for loss of rent. (v) The Builder’s representatives explained that the contract was subject to Council approval to commence construction. (vi) Mr Suyatno explained to Mr Akhavan that it had been Mr Akhavan’s decision to demolish the existing dwelling, and that it had been Mr Akhavan’s decision to make continual amendments to the design which were responsible for significant delays, including additional requests for information from the Council, (vii) Mr Suyatno’s understanding was that Mr Akhavan left the meeting intending to engage a different builder, or possibly to sell the property with the approved plans. (viii) The only matter left to be arranged was for Mr Akhavan to request a breakdown of the costs that the Builder had incurred to date. (f) On or around 13 July 2023, in accordance with the builder’s understanding of the situation Alan Joliffe released the CAD files to Mr Akhavan. (g) Following receipt of the CAD files, Mr Akhavan emailed Mr Suyatno to request the Revit files, “in case the buyer wants to make any changes to the current plans.” (h) That email further stated: As discussed, these drawings and associated files, may be used by me or another owner to build at Page St. if you oppose this, please let me know by COB 19 th July 2023. Otherwise, it will be taken and understood that Iconic Line Construction acknowledge the transfer of the copyright to me and any third party to build at this address. (i) The Builder did not oppose the transfer of the copyright to Mr Akhavan because it is understood that it would no longer be completing the works. Mr Suyatno understood that Mr Akhavan intended to either complete the works with another builder or to sell the property with the approved plans. (j) On or around 26 July 2023, Mr Suyatno received an email from Mr Akhavan requesting the costs that the Builder had incurred to date. It also contained words to the effect that Mr Akhavan confirmed receipt of the drawings and building approval and that he considered the copyright of the plan is to have been transferred to him. (k) On 29 July 2023, Mr Suyatno sent an email to Mr Akhavan detailing a list of additional expenses incurred by the Builder for the work. -- 10 of 18 -- 11 (l) On 31 July 2023, Mr Suyatno received an email from Mr Akhavan proposing to except only part of the costs the builder had claimed to have incurred. (m) On 3 August 2023, there were a series of emails between Mr Suyatno and Mr Akhavan relating to these claims and other matters in dispute. At about 2:17 PM, Mr Suyatno sent an email to Mr Akhavan stating that some of Mr Akhavan’s cost calculations were not relevant because the Builder was no longer engaged by Mr Akhavan on the project. [35] At the hearing, Mr Suyatno was asked if the purpose of the meeting was to discuss Variation 4. He agreed that it was. He was asked if Mr Akhavan had asked for work on the dwelling to start. He said that work would not start until the price increase was agreed. He was asked again if Mr Akhavan had asked for work to start. Mr Suyatno said that that he knew that Mr Akhavan did not like the price increase but could not recall if he had asked for work to start because he was in and out of the meeting on several occasions. He agreed that Mr Akhavan asked that Variation 4 be withdrawn. [36] Mr Suyatno agreed that Mr Akhavan had asked for the drawings because he could not afford the Builder’s new price for the dwelling. Asked if Mr Akhavan had expressed an intention to sell the property, he said he could not remember. [37] It was put to Mr Suyatno that he did not give Mr Akhavan express permission to use the drawings. He said he had been happy to provide the drawings to him. It was further put to him that this was not the same as permission to use the drawings and that, on that issue, he had told Mr Akhavan that he would need to think about it. Mr Suyatno said he could not remember. It was suggested to him that he never provided permission. He said that he did provide written submission in November 2023. He agreed that this was after the notice of termination had been given. Asked if he agreed that no written permission was given before November 2023, he said he was not clear about that but had been happy, in principle, to provide the drawings. [38] Mr Suyatno agreed that Mr Akhavan had also asked for a full refund of his deposit. He said that he had explained to Mr Akhavan that a full refund could not be made because of the expenses incurred by the Builder. He agreed that he had told Mr Akhavan that he would get back to him on that. He further agreed that the meeting had not resulted in any agreement. [39] Mr Suyatno was taken to a series of emails between himself and Mr Akhavan of 3 August 20237. He agreed that he did not accept any of Mr Akhavan’s proposals and that the parties never agreed on an amount to be refunded. [40] Mr Suyatno was asked about his authority to contract on behalf of the Builder. He said that he had no express authority to enter or alter contracts. His responsibility in that regard was to provide input into costings. He agreed that contracts were executed by one or more of the directors. Principles [41] A decision of the QBCC that a building contract has, or has not, been validly terminated for the purposes of determining whether a claim for non-completion under the statutory insurance scheme should be allowed is a reviewable decision. A 7 HB 106 – 100. -- 11 of 18 -- 12 reviewable decision is defined in s 86 of the QBCC Act to include an internal review decision (itself defined in s 85A of that Act). [42] By s 87 of the QBCC Act, a person affected by a reviewable decision may apply to the Tribunal for a review of the decision. The Tribunal’s review jurisdiction is the jurisdiction conferred on the Tribunal by an enabling Act to review a decision made or taken to have been made by another entity under that Act.8 I am satisfied that the Tribunal has jurisdiction to review the Decision. [43] This matter turns on the question as to whether the meeting of 11 July 2023 evidenced, or can reasonably be interpreted to show, that the contract had been brought to an end by mutual termination or abandonment. [44] The Court of Appeal in Imam v Life (China) Company Limited9 held: Whether a contract has been abandoned is a question of fact to be inferred from an objective assessment of conduct of the parties…[O]ne must have regard to the conduct of the parties, and what might be inferred from that conduct. The authorities establish that the court looks at an objective assessment of the conduct of the parties, and as to whether that conduct result in an inference that neither party maintains an intention to perform the contract. The assessment does not call for an examination of whether a party actually has this objective intention of abandoning, but considers “whether there conduct, when objectively viewed, manifested that intention”. [45] In Cedar Meats (Aust) Pty Ltd v Five Star Lamb Pty Ltd10 (‘Cedar Meats’) the Supreme Court of Victoria held: The critical question is whether the parties conducted themselves mutually in such a way so as to convey to the other that they did not intend that the Agreement should be further performed or that such party did not regard the agreement as being in force. In other words did the parties by their external manifestations evince an intention to abandon or abrogate the Agreement. If they did the Agreement will be discharged. In Australia, several appellate decisions have concluded that whether there is abandonment or abrogation of a contract is a matter of fact to be inferred from an objective assessment of the conduct of each party as evinced to the other and acted upon. The court is not required to examine whether the party actually had the intention of abandoning the agreement. The inference of abandonment will be drawn more readily where “an inordinate length of time has been allowed to elapse, during which neither party has attempted to perform, or called upon the other to perform, a contract made between them…”. What is really inferred in such a case is that the contract has been discharged by agreement, each party being entitled to assume from a long continued ignoring of the contract on both sides that “the matter is off altogether”. As the New South Wales Court of Appeal stated in Ryder v Frohlich: The underlying premise of the abandonment cases is that a period of time lapses during which neither party to the contract manifests any intention 8 Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 17(1). 9 [2023] QCA 19, [107] (citations omitted). 10 [2013] VSC 164, [43] – [46]. -- 12 of 18 -- 13 to perform the contract, leading to the inference that the contract has been abandoned. It is clear that the question whether an “inordinate length of time has been allowed to elapse” is relative. In DTR Nominees Pty Limited v Mona Homes Pty Limited the High Court was prepared to infer abandonment after a period of less than five months had elapsed during which neither party took any steps to perform the contract. In Fitzgerald v Masters it was held that a contract for the sale of land had not been abandoned even though proceedings for its specific performance were not commenced until 26 years after its execution. [Citations omitted.] [46] This case has been cited with approval in the Appeal Tribunal.11 [47] In CGM Investments Pty Ltd v Chelliah12, Finkelstein J held: [A] contract “can be extracted from circumstances where no acceptance of an offer can be established or inferred and where the most that can be said is that a manifestation of mutual assent must be implied from circumstances”. So it must be with an implied agreement to abandon a contract. In my opinion to show that a contract has been abandoned by inactivity on both sides it is necessary to establish that the inactivity (which may sometimes amount to no more than silence on one side) produces the clear inference that one party does not wish to proceed with the contract and the other party consented to that situation. [48] The passage from Ryder v Frohlich13 quoted in Cedar Meats above is to the effect that what constitutes the lapse of an inordinate amount of time is relative. In that case, an abandonment of the contract was held to have taken place more less immediately when the parties’ conduct was considered. [49] An example where a significant lapse of time was not relevant was provided in Mareva Building Consultants v Zevon and Zevon14, in which a contract for a house in one location was agreed but put on hold by the owner just was work was to commence. The owners sought to build instead in a second location but the parties were subsequently unable to agree on a price. The builder had not pressed for payment for the work referable to the first location. The Court held: Considered together [the] facts are inconsistent with [the builder’s] claim that the contract to build the [first] house remained on foot despite [the builder] being offered the [second] project. … Objectively, the facts of the meetings between [the builder] and [the owner] confirm such a factual circumstances and the primary judge’s finding. [The builders]’s conduct is wholly consistent with the finding of the primary judge that the contract to build the [first] house had been mutually abandoned. [50] The Commission also brought to the Tribunal’s attention several VCAT decisions concerning abandonment of residential construction contracts: 11 See Stuart v Queensland Building and Construction Commission [2015] QCATA 81. 12 [2003] FCA 79, [21] – [22]. 13 [2004] NSWCA 472, [136]. 14 [2013] ACTACA 28, [29], [31]. -- 13 of 18 -- 14 (a) Torua v Sariklis (Domestic Building)15: “Had the builder intended to perform the contract, it would have taken some steps following its suspension of the works to bring matters to a head. However nothing occurred, with the result that the owner then took over the works herself. Again the builder did nothing in response to that action, apart from making a claim for the value of the work completed by it as at the date it ceased work. Viewed objectively, I find that the contract was abandoned by the parties …” (b) In Yan v Brown Bros Cabinet Work Pty Ltd (Domestic Building)16, the parties had several meetings about the scope and price of the works, and the parties disagreed as to whether a contract had been formalised or a price agreed, although the owner had made payments to the builder. A new contract was prepared by the builder but further variations were sought by the owner and no agreement was reached. The builder subsequently wrote to the owner offering the option of a cancellation of any contract with a refund of monies paid less expenses, or a new contract encompassing the further changes. The first option would be deemed accepted unless the owner advised otherwise. The owner sought specific performance of the original contract. The Tribunal held: “[W]hen the parties’ conduct is objectively viewed, it is clear that neither wanted to proceed with the contract in its original form. The fact that [the owner] originally sought specific performance of the contract does not detract from that conclusion because her insistence on specific performance relates to a scope of work which is different to what was originally contemplated by the contract. Accordingly, I find that the contract between the parties has been mutually abandoned. In my view, that occurred at the conclusion of the meetings… At which point it became clear that the parties could not agree on the changes to be made to the scope of joinery works under the contract or agree on the terms of a substituted contract.” (c) Agropolou v Shkolyar (Domestic Building)17, where the builder advised the owner that no more work would be undertaken until outstanding progress claims were made, to which the owner replied that he would not make any further payments. Following this conversation, the builder did not undertake any further work and the owner did not make any payments. The contract was held to be abandoned from the date of the conversation. Was the contract mutually terminated or abandoned? [51] The Commission submitted that the relevant events were: (a) Mr Akhavan had made the appropriate payments under the contract; (b) On 15 May 2023, the Builder issued Variation 4 citing increased costs in building supplies and materials; (c) at the meeting of 11 July 2023, the parties agreed to mutually terminate the contract. At the meeting, Mr Akhavan requested that the CAD files and the Revit files be released for his use to engage a new contractor or, alternatively, for a subsequent purchaser of the property to undertake the works; 15 [2012] VCAT 144, [158]. 16 [2013] VCAT 1623, [46] – [49]. 17 [2011] VCAT 2213 -- 14 of 18 -- 15 (d) on 13 July 2023, the Builder released the CAD files in accordance with the mutual termination of the contract; (e) on 17 July 2023, Mr Akhavan requested the Revit files and confirmation that any “associated with construction’s plans had been transferred” to him and stating quotes as discussed, these drawings and associated files may be used by either [him] or another owner to build at Page St.” (f) there was a disagreement between the parties with respect to “the costs associated with the project to date”; (g) on 3 August 2023, the builder sent correspondence to the applicant stating that the contract had been mutually terminated and, further, that the builder was no longer completing the construction of the dwelling; (h) on 13 September 2023, Mr Akhavan’s lawyers asserted that Mr Akhavan considered that the contract remained on foot and he required the withdrawal of Variation 4, but that he would consider a mutual termination of the contract on the condition that the Builder would grant a licence to him use the plans. [52] The Commission submitted that the conduct of the Builder and Mr Akhavan was categorically inconsistent with each of the parties performing their outstanding requirements under the contract because: (a) the statements made by Mr Akhavan at the time of requesting the drawings objectively raised the possibility that that he would either be continuing the build with another contractor or a subsequent purchaser of the property to build; and (b) the statements made by the Builder in light of the disagreement regarding costs, namely that at that time any costings previously submitted had become irrelevant given the builder was no longer performing the works under the contract. [53] The Commission submitted that, objectively, the parties intended for a different entity other than the builder to undertake the works and that this amounted to the threshold set out in Cedar Meats, allowing the inference of abandonment to be drawn. [54] The Commission had, therefore, determined that the notice to remedy breach and the termination notice were invalidly issued because the contract had been mutually abandoned through the parties’ conduct on or around 11 July 2023. [55] For Mr Akhavan, it was submitted that, objectively viewed, the parties did not mutually terminate or abandon the contract in circumstances where: (a) no such agreement or understanding was reached during the parties’ meeting in July 2023; (b) a mutual termination or abandonment is inconsistent with the party’s written communications over the two months immediately following the meeting; and (c) there was no inordinate length of time during which neither party attempted to perform or call for the performance of the contract. [56] It was submitted that the evidence of the meeting of 11 July 2023 showed: -- 15 of 18 -- 16 (a) Mr Akhavan demanded that the Builder withdraw Variation 4 and commence the works under the contract; (b) Mr Suyatno said that the Builder would not withdraw Variation 4 and would not commence works without Mr Akhavan’s acceptance of the variation because otherwise the Builder would suffer a loss; (c) Mr Akhavan said that he would only consider a mutual termination if he was refunded the entire deposit and given express permission to use the plans; (d) Mr Suyatno said the Builder could not refund the entire deposit consider a partial refund, and would provide an update in the next five days on the Builder’s costs to date and whether it would allow Mr Akhavan to use the plans. [57] On an objective assessment, it was submitted: (a) Mr Akhavan’s statements to the builder evinced an intention for the works to commence without the price increase in Variation 4, which was an invalid variation; (b) The Builder’s statements to Mr Akhavan evinced an intention to uphold Variation 4, despite it being invalid, for commercial reasons, and to refuse to commence the works unless Variation 4 was paid. [58] Accordingly, there was no mutual abandonment: only the Builder evinced an unwillingness to be bound by the contract. At this time, Mr Akhavan had paid the deposit in full and still needed to build a house on the property. His request for a refund was rejected and his request for express permission to use the plans was not accepted. [59] It was submitted that, if any agreement or understanding was reached during the meeting, it was that the builder would simply update Mr Akhavan on its position regarding its costs to date and whether it would permit him to use the plans. The subsequent discussions between the parties indicate that neither of the conditions sought by Mr Akhavan were agreed to by the Builder. [60] It was submitted that the Builder’s communication of 3 August 2023, that Mr Akhavan’s proposed refund was “not relevant anymore since we are not building for you,” was a unilateral communication by the Builder as to its unwillingness to comply with the contract rather than evidence of any mutual intention of the parties to abandon the contract. There was no corresponding evidence of such conduct on the part of Mr Akhavan. [61] Finally, it was submitted that there was no inordinate length of time that had been allowed to elapse, such that an inference of abandonment could be more readily drawn. Mr Akhavan took immediate steps to arrange a meeting to discuss Variation 4. A period of failed negotiations followed, after which he instructed his lawyers to require commencement of the works. This period encompassed a period of only two months. [62] I prefer Mr Akhavan’s account of the meeting of 11 July 2023 and the subsequent negotiations to that of Mr Suyatno. Mr Suyatno’s account suffered from his lack of recall of key elements of the meeting and was not assisted by his periodic absences from it. It is clear from the evidence that the purpose of the meeting was to discuss Variation 4, rather than to bring the contract to an end. However, if the course of the -- 16 of 18 -- 17 events at the meeting and subsequently was inconsistent with the parties performing their outstanding requirements under the contract, the inference of mutual termination or abandonment can be drawn. [63] I consider that the evidence presents a course of events materially different to the examples cited at paragraph [50] above: (a) Unlike the situation in Torua18, there was no inactivity on the part of Mr Akhavan to any conduct of the Builder inconsistent with the continued existence of contract (viz, its issuing the invalid variation and purporting to declare the contract to be at an end on its non-acceptance). Rather, Mr Akhavan nominated two conditions under which he would release the builder from the contract, to one of which it repeatedly declined to respond and the other to which it would not agree. Following this, Mr Akhavan sought to exercise his remedies under the contract. (b) Unlike the situation in Yan19, there was no lack of certainty about the terms of any contract into which the parties had entered. (c) Unlike the situation in Agropolou20, there was no simple mutual abandonment of the contract. The evidence is that Mr Akhavan was energetic in seeking either performance of the contract or satisfaction of the two conditions he had proposed for the Builder’s release from it. [64] I do not accept the submission that Mr Akhavan’s statements as to his purpose of seeking the drawings give rise to any inference that his conduct was “categorically inconsistent” with each of the parties performing their obligations under the contract. Rather, the request for the drawings was a rational demonstration that Mr Akhavan was prepared to terminate construction if the variation was not withdrawn: the only use to which the drawings could be put were with a new builder at the site or a new buyer of the property. I do not accept the Commission’s submission that conduct that “objectively raised the possibility” of other options is the correct or appropriate test for mutual termination. For abandonment or mutual termination, there must be an objective assessment of the parties’ conduct which results in an inference that neither party maintains an intention to perform the contract21. [65] I have two further observations in relation to Mr Akhavan’s request for the drawings: (a) I accept his evidence that his claimed assumptions that the assignment or licensing of the copyright in the drawings would be effected if the builder did not deny it was an attempt on his part to force the issue. Further, I consider the Builder’s continuing silence on the topic to constitute an attempt to escape the contract without giving anything further away. The drawings, of course, would be of limited value to a new builder or a purchaser of the site without a clear licence. (b) I reject the Commission’s assertions that the release of the drawings was “in accordance with the mutual termination agreement” as a characterisation that is not available on the evidence. The Builder never provided express written 18 Supra, n 15. 19 Supra, n 16. 20 Supra, n 17. 21 Imam v Life (China) Company Limited, supra, n 9 -- 17 of 18 -- 18 permission for the use of the plans (as required by clause 12 of the contract) before the notice of termination, despite repeated requests. On the issue of the request for express permission, I prefer Mr Akhavan’s evidence over that of Mr Suyatno, who could not recall the relevant discussion and was vague about the matter generally. I find that express permission was requested but not provided at the meeting or at any time prior to the notice of termination. [66] I accept that the Builder’s assertion that it was no longer Mr Akhavan’s builder does give rise to the relevant inference in respect of the Builder’s view of its contractual obligations. However, by itself it does not give rise to the essential element of mutuality. There is no evidence that Mr Akhavan was prepared to accept the assertion without satisfaction of the conditions he had offered. [67] On the evidence, I am satisfied that, objectively viewed, the meeting of 11 July 2023 and the subsequent negotiations were not inconsistent with both parties performing their outstanding requirements under the contract. To the contrary, I am satisfied that Mr Akhavan’s conduct was entirely consistent with his seeking to either have Variation 4 withdrawn and for work to proceed, or for the Builder to provide him with an appropriate remedy for its conduct in respect of the variation. It therefore follows that the contract was not abandoned or ended by mutual termination. [68] In these circumstances the Decision of 4 March 2024 should be set aside. The correct and preferable decision is the Original Decision of 10 January 2024. -- 18 of 18 --