LEE and HOLMES [2020] WASAT 108 | Case summary

A person who carried out regulated building service - No evidence that the construction or any part was 'carried out' by the respondent - Applicants asserted that the respondent did not perform any regulated building service - Applicants sought an order that the respondent pay the remedial costs of the faulty and unsatisfactory regulated building service

LEE and HOLMES [2020] WASAT 108 | Case summary | Zoe

[70]

All four complaints were referred to the Tribunal by the Commissioner's delegate pursuant to s 11(1)(d) of the BSCRA Act (the relevant enabling Act for the purposes of s 15 of the State Administrative Tribunal Act 2004 (WA) (SAT Act)). Once referred to the Tribunal, the proceedings fall within the Tribunal's original jurisdiction as provided for by s 15 of the SAT Act.
The BSCRA Act empowers the Tribunal to make a building remedy order against 'a person who carried out a regulated building service' that is complained of (see s 36(1) and s 38(1) of the BSCRA Act).
A regulated building service relevantly means a building service 'carried out' by a registered building service provider or 'home building work' 'carried out by a person for another person pursuant to a home building work contract or other contract or arrangement for gain or reward' (s 3 of the BSCRA Act).
It is beyond argument that the construction of the two dwellings on 23A and 23B is each a 'building service' as defined and is also 'home building work' as defined in s 3 of the BSCRA Act and s 3 of the Home Building Contracts Act 1995 (WA) (HBC Act). The construction of the two dwellings was carried out, on the evidence, for gain or reward.
While Mr Holmes is a registered building service provider because he is a registered 'building service contractor' (registration number 11636), the Tribunal must be satisfied that the work was 'carried out' by him. If he is a person who carried out the regulated building service complained of, the Tribunal has the power to make an order that he pay the cost of remedying the same pursuant to s 36(1)(b) and s 38(1) of the BSCRA Act. If he is not a person who 'carried out' the regulated building service complained of, the Tribunal cannot make an order pursuant to s 36(1)(b) and s 38(1) of the BSCRA Act against him.
The Tribunal has recently had the opportunity to consider the cases relevant to a conclusion about who is a person who 'carried out' a regulated building service. That phrase does not apply to the person who merely undertakes the physical labour tasks in the construction of the dwelling. It refers to the person who carries the responsibility of the construction of the edifice (as described in Shaw v McLeod (unreported, WASC, Library No 4707, 8 November 1982)) as cited and applied in Shami and Teo [2017] WASAT 73 (Shami). Whilst it is a question of fact, who did create or construct the edifice, in Hawke and Ennis [2018] WASAT 118, the Tribunal concluded, unsurprisingly, that the entity that issued the invoices to the owner and deposited the payment for those invoices, was the entity that 'carried out' the regulated building service on the evidence in that proceeding. The responsibility for the construction of the edifice and the 'building project' calls for an examination of all aspects of the alleged involvement of the person alleged to be the one who carried out the regulated building service, from quoting for and contracting with the owner, obtaining authorisation to construct, purchasing or calling for the supply of the required goods and services for the construction, supervising the performance of the supply of the goods and services on the site, paying for the goods and services supplied, paying for the cost of the goods and services incurred the construction, rendering invoices to the owner for those cost and receipting the funds paid.
The applicants rely on two 'contracts' which on their face identify Mr Holmes as a 'builder' and two building permits issued to Mr Holmes for the construction of the two dwellings to establish that he is the person against whom an order may be made by the Tribunal pursuant to s 36(1)(b) and s 38(1) of the BSCRA Act.
As a matter of law a court (and tribunal) may disregard an instrument such as an agreement where the same does not fully disclose the legal relations, rights, entitlement and liabilities of the parties thereto (Raftland Pty Ltd v Federal Commissioner of Taxation [2008] HCA 21; (2008) 238 CLR 516). This might arise where the instrument or series of instruments were intended to deceive third parties as to the true intention (second example given by Mustill LJ in Hadjiloucas v Crean [1988] 1 WLR 1006 at [1019]) (Hadjiloucas). It may also arise where the facts and circumstances of the true position of the parties are so divergent from the contents of the instrument as to conclude that the parties did not intend for the parties to have the legal relations, rights, entitlements or obligations as disclosed on the face of the instrument (first example given in Hadjiloucas). In this proceeding the Tribunal finds that the contracts were not intended to be performed in their terms or at all and that the two building permits were obtained in the name of Mr Holmes, with full knowledge of Mr Holmes and the respective applications that Mr Holmes would not construct the two dwellings. There is direct, clear unchallenged evidence of that position.
The question in these proceedings is whether Eleven and/or Mr Holmes is that person, on the evidence. For the reasons referred to below, the Tribunal concludes Mr Holmes is not that person. There is no need for the Tribunal to consider the position with respect to Eleven, as consent orders were made that substantially disposed of the disputes in CC 1635/2019 and CC 1636/2019 on 10 March 2020.

[74]

The email contents immediately raised the issue whether Mr Leroy was the correct respondent to the proceedings or whether it should be the company he represented - Eleven - being the entity that issued invoices for the supply and installation of the windows and doors in issue in CC 1636/2019 (23A) and CC 1635/2019 (23B) or another unidentified person who was referred to by Ms Lee as 'our builder'. Further, Ms Lee supplied copies of invoices that she asserted were relevant to establishing the identity of the respondent, which at that stage was Mr Leroy in each complaint. Ms Lee enclosed an invoice from a Chinese company in Hong Kong referred to as 'Iris Eight Limited' addressed to Eleven noting 'Balance payment due for Windows and Doors' in the sum of HK$35,661.71. Ms Lee supplied another invoice from that same company addressed to herself noting 'Windows and Doors' in the sum of HK$69,173. Ms Lee supplied a further invoice from Eleven to 'P.J. Holmes' noting 'Window Labour for First Floor front house at 43 McLeod Road, Applecross' in the sum of $2,674. The Invoice is not fully addressed and only refers to the 'P.J. Holmes'.
These documents are the same on each of the files referred to the Tribunal and which became CC 1635/2019 and CC 1636/2019, save for the photos and drawings that pertain to the particular dwellings. It is not clear to which dwelling (the one constructed on 23A or 23B) the invoices relate and in particular which dwelling Eleven's invoice to 'P.J. Holmes' relates. The invoice from Eleven incorrectly notes the address as '43' instead of 23 MacLeod Road, but refers to the 'front house' which the Tribunal finds relates to the dwelling which is the subject of CC 1636/2019 constructed on 23A, closest to MacLeod Road, it being at the front of the block from MacLeod Road.
The attached invoices and in particular the invoice from Eleven to 'P.J. Holmes' raised a question about what was the latter's involvement. Ms Lee's emails raise the question of who was the 'builder' or the person who carried out the regulated building service in issue.
By email dated 18 July 2019 the Commissioner's senior complaints officer wrote to Ms Lee in both proceedings informing her that:

[78]

The basis of that statement is not known.
On 8 August 2019 the Commissioner's senior complaints officer received a series of documents from the City. One is building permit BA2017874 (23A building permit) which refers to a 'Two Storey Dwelling with Undercroft, Front Section Wall and Associated Retaining Walls' proposed to be constructed on 23A, with an estimated value of $495,000. There is no dispute between the parties that a two-storey residential dwelling with undercroft and front screen wall and associated retaining walls was to be and is constructed on 23A. There is no dispute between any of the parties that the doors and windows supplied and installed in the dwelling constructed on 23A were supplied by Eleven, and comprised part of the work that is the subject of the 23A building permit for 23A. Another document is building permit BA-2017-76 (23B building permit) which refers to a 'Three Storey Dwelling with Undercroft, Swimming Pool with Barrier and associated Retaining Walls to Lockup' proposed to be constructed on 23B with an estimated value of $795,000. There is no dispute between the parties that a three storey (four level) residential dwelling with undercroft and swimming pool with barrier and associated retaining walls was to be and is constructed on 23B. There is no dispute between any of the parties that the doors and windows supplied and installed in the dwelling constructed at 23B were supplied by Eleven and comprised part of the work that is the subject of the 23B building permit.
What is immediately notable from the 23A and 23B building permits is that both were issued in the name of Mr Holmes, as the builder, by the City on 25 January 2017. As is noted in these reasons, the email addresses for the 'builder' on each of the applications for the 23A and 23B building permits refers to email addresses for a Mr Sean O'Reilly and Mr Mario Andreou.
The Commissioner's documents provided to the Tribunal in CC 1635/2019 and CC 1636/2019, each contain the Commissioner's senior complaints officer's memorandum dated 16 August 2019 being a record of a telephone conversation he had with Ms Lee on behalf of all of the applicants wherein he stated:

[87]

It is to be noted that the 23B building permit is for a three storey dwelling and undercroft (four levels) and not as the contract states a two storey dwelling.
The discrepancies between the 23A and 23B building permits and the 'contracts' provided by Ms Lee are not explained in the Commissioner's documents and were not explained in the evidence during the hearing in the Tribunal.
The Tribunal notes that the 'owner' details in respect of the schedule of particulars of the 'contract' for the construction of a dwelling in CC 1636/2019 is described as Mr K Ling and not Ms Yong. The builder is described as Peter Holmes. Both the owner and the builder appeared to have signed the 'contract' and each of the owner's and builder's signature is witnessed by Mr Sean O'Reilly. Ms Yong is not a registered proprietor of the land at 23A, but the proceedings commenced in her name were permitted to proceed in the Building Commission because she is the wife of Ms K Ling and has a sufficient interest in the dwelling to be able to lodge and prosecute the complaint, according to the Commissioner's delegate. The Tribunal notes that a complaint made pursuant to s 5(1) of the BSCRA Act may be made by 'a person'. Ms Yong is effectively a representative complainant. In any event, Mr K Ling represented himself during the final hearing of the proceedings.
The Tribunal notes that the 'owner' details in respect of the schedule of particulars of the 'contract' for the construction of the dwelling in CC 1635/2019 is described as Mr Leong Ling and Ms Lee. The builder is described as Peter Holmes. Both the owners and the builder appeared to have signed the 'contract' and each of the owners' and builder's signatures are witnessed by Mr Sean O'Reilly. Ms Lee is a registered proprietor of the land and that was accepted by the Commissioner as a sufficient interest in 23B to make the complaint in CC 1635/2019.
Neither 'contract' identifies an estimated price for the dwelling and the progress claim payments provision of the schedule in each 'contract' simply provides for a minimum of 14 days between the issue of claims and demand for payments.
The Commissioner's documents provided to the Tribunal in CC 1635/2019 and CC 1636/2019 contain an email from the Commissioner's senior complaints officer to Ms Lee dated 21 August 2019 in which the Commissioner's delegate stated:

[93]

On 23 September 2019, Ms Lee wrote to the Commissioner's two senior complaint officers with whom she was corresponding on behalf of all of the applicants and made the following submissions:
1. The construction 'for both 23A and 23B' were arranged by Mr Sean O'Reilly and 'accompanied' by 'a Mr Mario Andreou'.
2. Both Mr O'Reilly and Mr Andreou are 'owners' and directors of Jetpoint Nominees Pty Ltd trading as Ace Construction.
3. 'They' [meaning Mr O'Reilly and Mr Andreou and/or Jetpoint Nominees Pty Ltd] were going to 'build our houses' but did not owing to 'inadequate insurance indemnity or so they claimed'.
4. 'Hence, Sean [O'Reilly] arranged to use Peter Holmes' building licence'.
5. Mr O'Reilly and Mr Andreou worked on site.
6. 'In return' Mr O'Reilly and Mr Andreou were paid $300,000 in full by the applicants by May 2019.
7. Upon full payment of costs and builder's fee by the applicants, Mr Andreou handed over the keys to the two properties built on 23A and 23B to the applicants.
8. Ms Lee stated 'we have never met Peter Holmes until 11th June 2019'.
9. At least Ms Lee met with Mr Holmes on site on 11 June 2019 at his request following Mr Holmes being contacted about remedial work that was required.
10. Ms Lee said that she informed Mr Holmes on site on 11 June 2019 that they had paid Mr O'Reilly and Mr Andreou all of the money for the construction of both dwellings on 23A and 23 B including the builder's fee of $300,000.
11. Ms Lee said that she informed Mr Holmes that Mr O'Reilly never mentioned the need to pay Mr Holmes during the course of construction of either of the dwellings and Mr O'Reilly was handling 'the agreed Building Fees ie:-paying Mario [Andreou] and himself and whoever else'.
12. Ms Lee said that Mr Holmes had never been on site.
13. Ms Lee asserted that Mr Holmes had never communicated with Ms Lee or any of the applicants prior to the complaint correspondence referred to above and subsequent meeting in June 2019. Mr Holmes had never dealt with any of 'our trades including our architect, Shayne Leroy'.
14. Mr O'Reilly and Mr Andreou had refused to attend to any of the defects in the construction of either home 'as they said they were not the Builder'.
15. Mr Holmes refused to attend to the defects 'claiming we did not pay him'.
16. Mr Holmes refused to sign the Completion Notice 'until we commenced Legal Action against him. He finally did on 16 June 2019'.
The copy of the Notices of Completion in respect of 23A and 23B both bear the date of 16 June 2019 and Mr Holmes' signature. There is no evidence of what legal action was commenced by the applicants, to which Ms Lee refers and the Tribunal notes that legal action must be unrelated to any of the proceedings in issue before it, as the earliest was commenced by a complaint to the Commissioner on 8 July 2019 two weeks after the Notices of Completion were signed by Mr Holmes.
On 3 October 2019 the Commissioner's senior complaints officer emailed Ms Lee in both CC 1635/2019 and CC 1636/2019 and informed her that both applications against both respondents was now in a suitable form and upon receipt of a completed complaint form identifying Mr Holmes as a respondent, he proposed referring the complaints to the Commissioner's delegate 'for consideration of acceptance'. He also noted that Ms Lee was in the process of investigating further complaint items. The complaints in CC 1635/2019 and CC 1636/2019 were subsequently recommended for acceptance and appear to have been accepted formerly by the Commissioner's delegate in early October 2019 pursuant to the BSCRA Act. The documentation of acceptance is not within the Commissioner's documents provided to the Tribunal in either CC 1635/2019 or CC 1636/2019.
By 17 October 2020, the Commissioner's delegate had investigated the complaints and made the decision to refer both complaints in CC 1635/2019 and CC 1636/2019 to the Tribunal pursuant to s 11(1)(d) of the BSCRA Act.
On 5 November 2019, CC 1635/2019 and CC 1636/2019 were listed for a directions hearing in the Tribunal. Both proceedings were adjourned to a further Tribunal directions hearing listed on 10 December 2019. On 6 November 2019 Ms Lee wrote to the Commissioner's senior complaints officer seeking information about a fresh complaint to be lodged in respect of the construction of the dwellings on 23A and 23B. In that email Ms Lee states:

[171]

During the course of her evidence, Ms Lee provided the Tribunal with three invoices from Mr Holmes and a photograph of a page in a book. The invoices are dated 12 March 2020 (in the sums of $22,000 including GST and $1,083.30 including GST) and 16 June 2020 (in the sum of $36,450 including GST) the photograph of the page in a book is a note of some payments made by the applicants but none is to Mr Holmes.
Ms Lee stated that she raised the defects with Mr Andreou and ultimately was contacted by Mr Holmes whom she met with her husband on site on 11 June 2020. She explained the above to Mr Holmes and he said he would return to her.
She did not hear further from Mr Holmes until he sent the further invoice in the sum of $36,450, noting the 'Builders Supervising Fee' including GST. This is in addition to the invoice for the sum of $22,000 he issued and gave to Mr Andreou who passed it on to Ms Lee in May 2019. The two invoices total $58,450 including GST. The Tribunal notes that at a rate of 5% as identified in the contracts, that fee would suggest the cost of construction before the builder's fee was $1,169,000. That is a figure that has no foundation in the evidence at all, as being the cost of the construction prior to a builder's fee.
As to the 23A and 23B building permits granted on 27 January 2017, Ms Lee said that Mr Andreou's company, Epic Holdings Pty Ltd, paid for the applications for the 23A and 23B building permits and the applicants reimbursed that cost by paying money to the joint account. She stated that both building permit applications were completed by Mr O'Reilly and Mr Andreou (having recognised their handwriting). Ms Lee acknowledged that Mr Holmes signed the applications but that the contact details for the 'builder' included Mr Andreou's email address and Mr O'Reilly's address at the Jetpoint email server address.
The Tribunal notes that none of the parties or witnesses adduced any further evidence about the establishment of the joint account or how it was that Mr Holmes was an apparent account holder but held no authority to draw upon it. Ms Lee again stated in her evidence it was all arranged by Mr O'Reilly (as did Mr Homes). No details were provided to the Tribunal about this account and no copies of the account or invoices issued by trades and suppliers to Jetpoint or invoices by Jetpoint for payment of the builder's fee of the construction costs was provided. By the same token no invoices by Mr Holmes (apart from those referred to above) were provided to the Tribunal and no invoices issued to Mr Holmes by trades or for supply of materials were provided to the Tribunal, save one. Mr Leroy issued an invoice to Mr Holmes on express instructions from Mr O'Reilly (ts 184, 18 February 2020).
The applicants' position following Ms Lee's evidence was (and always was) that Mr Holmes was not the builder of the dwellings and because of that fact, the applicants would not allow Mr Holmes to undertake any remedial work to the same. Curiously, the applicants however asserted repeatedly that they claimed that Mr Homes is the person who should be ordered to pay the costs of the remedial work. The respective applicants maintained that position, not withstanding that the Tribunal alerted the applicants during the course of the hearing (and at the directions hearing on 10 March 2020), that the Tribunal is empowered to order only the person who carried out the regulated building service to pay the cost of any remedial work to rectify faulty and unsatisfactory or non-proper and proficient regulated building services.
In closing, it was put to the Tribunal that Mr Holmes was an undisclosed agent for himself, Mr O'Reilly, Mr Andreau and/or Jetpoint and the applicants had elected to commence proceedings against Mr Holmes. For the reasons identified that assertion is not accepted on the evidence. The Tribunal finds that Mr Holmes was not an agent of anyone and more importantly he did not carry out any of the the regulated building service that is the subject of the proceedings. The detail of Ms Lee's oral evidence is included because the information is totally inconsistent with the applicants' position that Mr Holmes is the person who carried out the regulated building services complained of, for the purpose of the Tribunal's exercise of its power to make an order pursuant to s 36(1)(b) and s 38(1)of the BSCRA Act.
Further that evidence tends to persuade the Tribunal that:

[174]

The applicants were aware that the applications for the building permits did not contain true and accurate information and were made in the name of Mr Holmes so as to ensure his insurer would issue a home indemnity certificate as required by the HBC Act and s 16(j) of the Building Act 2011 (WA) for the issue of the 23A and 23B building permits.
When asked why the applicants agreed to execute contracts and building permit applications as owners that they knew were inconsistent with the agreements reached with Mr O'Reilly, Mr Andreou, Jetpoint and totally inconsistent with their intentions concerning Mr Holmes, Ms Lee's response was that the applicants assumed that 'this this how we thought things were done in Australia'. The Tribunal does not accept that statement as true. Ms Lee was asked if she held a profession and she denied that (ts 27, 17 February 2020). In fact under crossexamination Ms Lee admitted she held a Bachelor of Laws degree but because she was not working at the time of giving evidence and was a 'housewife' she denied she was a member of the Malaysian Bar (ts 112, 18 February 2020). The Tribunal finds that none of the applicants in all likelihood read the contracts for the construction of the two dwellings, but only because they considered them to not be binding in any way. The Tribunal is not able to find, and need not find, what the purpose of the contracts truly was but it is sufficient for the Tribunal to find that in law there was no contract between the parties identified in the HIA cost plus contracts for the construction of dwellings at 23A and 23B, because of a total lack of contractual intention by both parties to agree to perform the terms and promises identified and provided for in those contracts. In fact so little regard was had to those documents that the scant details of the dwellings to be constructed is obviously incorrect and inconsistent with the 23A and 23B building permits and what was constructed on each parcel of land. Further, the progress payments of the builder's fee were not complied with; the completion date for construction was not complied with (approximately one year and seven months or so or 19.5 months from the issue of the 23A and 23B building permits, as opposed to two and a half years or 30 months from the issue of the 23A and 23B building permits) all tend to establish that the terms and promises of the contracts for the construction of the two dwellings were never intended to be complied with. Most significantly of all is that the applicants did not receive any invoices from Mr Holmes for anything during the construction of the dwellings and did not pay him anything.

[176]

Mr Holmes' position was, curiously, that he is the person who carried out the regulated building service complained of and that he would attend to all of the defects by performing the remedial work, provided that he was paid the sum he invoiced the applicants ($58,450 including GST). For the reasons explained below the Tribunal concludes that there is no factual foundation for the assertion that Mr Holmes carried out the regulated building service complained of and that there was no basis for him rendering the two invoices totalling $58,450 including GST.
The evidence of Mr Holmes, considered in totality, confirms Ms Lee's evidence concerning the contract, the execution of the applications for the 23A and 23B building permits and the construction of the dwellings. Mr Holmes was called by the applicants to give evidence across all four proceedings. Although he asserted some knowledge of the construction, the Tribunal found his evidence in that respect vague and unreliable and rejects his evidence. Mr Holmes' evidence in summary is as follows:
1. Prior to June 2019, he had no direct engagement with any of the applicants and only dealt with Mr O'Reilly, whom he described initially as a friend but also as a business associate. He became involved in applying for the 23A and 23B building permits because Mr O'Reilly promised him some work on another development in the future.
2. He did not meet the engineers engaged in the construction of the dwellings and did not know the name of the engineers who constructed the piling structure for the undercroft, but knew someone was checking them. He did not layout the site for the concrete grano workers and did not check anything. He was unable to identify the number of piles constructed for the undercroft except to say there were over 100, which is extraordinary given the size and complexity involved in the construction and the substantial cost involved in excavations and construction of the piles.
3. Mr Holmes claimed the dwellings were at lock up notwithstanding the fact that a number of external doors and some windows did not lock and some had no striker plates or latches. He ultimately admitted he did not know if the dwellings were at lock up stage on any given date.
4. Mr Holmes eschewed contractual responsibility for the supply and installation of doors and windows on the basis that they were imported from China, but could not identify any variation to the 'contracts' where by the supply and installation of the same were to be removed from the scope of works. Eleven has consented to orders concerning the doors and windows in the construction of both dwellings and for the reasons already stated, does not accept that the 'contracts' were ever performed or intended by the respective parties to be performed. The Tribunal does not accept Mr Holmes' evidence that he declined to supply and install the doors and windows. The Tribunal finds he was not involved in the construction of the dwellings to any extent.
5. He afforded no explanation as to how it came to be that Eleven was engaged to supply and install the doors and windows, although he maintained that he had site meetings with Mr O'Reilly and Mr Leroy. It is common cause that Mr Holmes and Mr Leroy met for the first time ever on 5 November 2019 in the Tribunal directions hearing for CC 1635/2019 and CC 1636/2019. This is inconsistent with Mr Holmes' assertion in evidence that he had site meetings with Mr Leroy, although Mr Holmes contradicted himself and also indicated that he had not been at these site meetings. Mr Holmes' evidence was very confused on these basic issues.
6. He had no knowledge of the supply and labour costs in total for either dwelling and had not issued any invoices at all during the construction of the dwellings as one would expect a builder to do under a HIA cost plus contract. It does not appear Mr Holmes issued the invoice for $1,083.30 to the applicants on 12 March 2020 as is suggested by that document. Its provenance is entirely unknown as it is was not a document given to Ms Lee by Mr Andreau on May 2019. Further as to the invoices for what he asserted is his 'Builder's Supervision Fee' under the two contracts, he had not issued any invoices; had no idea what was the cost of the construction of each dwelling. Although Mr Holmes asserted that he was entitled to 'about' 5%' as a margin on the total costs which he estimated was $1,200,000. It was evident from his evidence he was not across any form of detail of the construction or cost thereof. The Tribunal finds that his lack of knowledge was caused by the fact that he had no part to play in the construction of the two dwellings as the builder or even as a tradesperson (ts 223, 18 February 2020). Mr Holmes' Builder's Supervision Fee, as stated above does not equate to 5% of 1,200,000 cost of construction.
7. Mr Holmes stated he did not ever receive any invoice addressed to himself in respect of the construction costs for either dwelling (ts 239, 18 February 2020) and he did not engage or direct any of the trades (ts 241, 18 February 2020). He stated that he had thought he might do so and intended to do some work under the contracts but didn't. It was put to Mr Holmes that the contracts purport to reflect his intention and promise to perform all the construction work by the engagement, payment, direction and supervision of relevant trades and the acquisition, payment, installation and supervision of installation of all materials in order to construct the two dwellings. Mr Holmes repeatedly asserted that he did intend to do some of the work but did not get a chance to do so. The Tribunal finds that Mr Holmes had no intention of performing the promises comprised in the terms of the contract and in any event did not ever perform any construction work on the dwellings.
8. When pressed he retreated to assertions that he was 'supervising' but could not say what or whom he was supervising, particularly as he asserted that both Mr O'Reilly and Mr Andreou were also 'supervising' something that was equally unspecific.
Mr Holmes was not a credible witness.

[178]

The Tribunal accepts the factual evidence of Ms Lee that consequently is not persuaded on the balance of probabilities that Mr Homes is a person who carried out any part of the regulated building services involved in the construction of the dwellings on 23A and 23B. Mr Holmes' evidence was unreliable on this issue and the Tribunal does not accept his mere assertions to the contrary. The motivation for his assertion is unclear but the Tribunal is not concerned with his motivations for advancing himself as the responsible party. What is clear from Mr Holmes is that he is prepared to undertake the relevant remedial work if he is paid $58,450 including GST. His position is as if he were a mere witness to the cost of the remedial work.
The Tribunal finds that neither the applicants nor Mr Holmes intended to be bound by the terms of the two HIA cost plus contracts for the construction of the dwellings, which were drawn up and prepared at Mr O'Reilly's instigation. Those contracts were intended to evidence the applicants' intention to reside at the dwellings, post construction.
The Tribunal finds that the applicants did not pay Mr Holmes any money to construct the dwellings, despite his name allegedly appearing on a bank account into which the labour, material and service costs were paid by the applicants and were drawn, but only by Mr Andreou.
The Tribunal finds that the applicant did not pay to Mr Holmes (and he did not receive) any builder's fee pursuant to the two HIA cost plus contracts or any other contracts or at all concerning the construction of the two dwellings. As he did not actually perform any services for the applicants he was not entitled to payment by them of any amount, on the evidence before the Tribunal.
The Tribunal finds that the applicants paid a 'builder's fee' of a total of $300,000 to some other entity which could have been Mr O'Reilly and/or Mr Andreou personally and/or Jetpoint. The Tribunal does not need to and should not make a finding of who it was that carried out the regulated building service in constructing the dwellings at 23A and 23B in the absence of a properly constituted complaint against an entity (other than Mr Holmes) made to the Commissioner and referred to the Tribunal.
The Tribunal finds that the applicants did not receive and Mr Holmes, did not send to the applicants, any invoices from trades or for the supply of materials (with or without a builder's margin) pursuant to the two HIA cost plus contracts, any contracts or at all.
It is common cause that Mr Holmes did not meet or have any direct or indirect negotiations or discussions with the applicants during the construction of the dwellings. The Tribunal finds that the applicants did not know Mr Holmes and did not meet him until June 2019.
The Tribunal finds that Mr Holmes' only contribution to the construction work for the two dwellings was to suggest an engineer and construction firm to perform excavation and the undercroft piling, which suggestion was not accepted by Mr O'Reilly, Mr Andreou or the applicants.
The Tribunal finds specifically that Mr Holmes played no part in supervising the construction of the two dwellings or the 'whole project' or indeed any part thereof. The Tribunal finds that he did not engage a trade or order the supply of materials for the construction of the dwellings and did not even obtain quotes therefor. The Tribunal does not accept Mr Holmes' evidence that he supervised the construction of the undercroft pilings or any other aspect of the construction of the two dwellings.
The Tribunal is satisfied and finds that the applications for building permits for 23A and 23B contained false details about the applicant and were known by all concerned (including the applicants and Mr Holmes) to be false. On the balance of the evidence and on the basis of the facts found the Tribunal concludes that it was never the intention of the applicant or Mr Holmes that the latter carry out the construction of the two dwellings in accordance with the permits or at all.

LEE and HOLMES [2020] WASAT 108 (7 September 2020)

At a glance

Court

Decision date

Source

Judgment (184 paragraphs)

LEE and HOLMES [2020] WASAT 108 (7 September 2020)

Legislation Cited (5)

Cases Cited (1)