Miguel Ocana and Johanna Ocana v Roche Constructions Pty Ltd

BACKGROUND FACTS 4The homeowners purchased the subject property around 2007. The existing premises comprised a single storey dwelling. The homeowners planned renovations and extensions to the dwelling and engaged Transpacific Group architects to prepare plans for it. 5The existing dwelling prior to the works the subject of this dispute had a two level slab on ground in the area where the extension was planned to be constructed. The two level slab comprised that part closest to the Southern boundary of the property which was higher than the slab on the Northern side. The higher part of the slab predated the purchase by the homeowners and had some type of garage structure erected on it originally. The lower part of the slab had been constructed by the homeowners in 2010 using subcontractors. 6Transpacific produced the relevant plans in about September 2011 which were submitted to Fairfield Council by the homeowners around that time. Transpacific had also engaged the engineers Zahoul Pty Ltd to prepare pad and footings and stormwater plans which were also provided to Council with the design plans. 7The plans received approval from Fairfield Council on 18 October 2011.

THE HOMEOWNERS' LAY EVIDENCE 8Miguel Ocana (MO) in his detailed statement dated 28 November 2013 says that the homeowners engaged the builder on 8 January 2012 to carry out works involving an extension to their existing house .He states that they received a scope of works via email from the builder on 28 May 2012 indicating a contract price of $104,500.00.He says that a 5% deposit was paid on 9 June 2012 and works commenced on 12 June 2012 even though they had not signed a contract and no home warranty insurance was in place. 9MO states further that a formal though incomplete contract was signed on 3 September 2012 and a HOW certificate was provided on 4 September 2102. 10MO claims that the work proceeded slowly and as at the date of his statement remains defective and incomplete even though "we have given all the money for this work as per the signed contract". Indeed he claims an additional amount of $6,963.00 has been paid on top of the contract price even though they were never informed of variations, nor were they made aware of any and no documents were signed in respect of them. 11MO further says that Mr Roche (RR) worked alone during the first 16 weeks of the job without any assistance from other labourers .He says that RR told him that if MO provided some labouring help himself it would reduce costs and the savings achieved would allow other things to be completed and the job could be finished sooner. MO has included an amount of $11,200.00 which he says relates to his labour contribution to the job. 12MO also gave oral evidence in which he confirmed the truth of his written statement. He was then cross examined by Ms Quinn. He said that their first contact with the builder was on 8 January 2012 when they met at the premises. He says that he showed all the plans to RR and had a quick discussion about it. At this time he claims RR said he thought it would cost "$70,000.00 to $80,000.00 roughly but I have to work on it". 13MO confirmed in answer to Ms Quinn that the $104,500.00 quote was the only written quote that he had received but that he did not receive it until 28 May 2012 even though it was dated 29 March 2012.He also denied having had any contact at all with RR during 2011 although he had obtained quotes from two other builders in 2011 but was not happy with them. 14Ms Quinn also questioned MO as to the progress of the works. MO indicated that he was concerned with the progress of the works almost immediately after its commencement. He says that the builder would turn up for a day or two and then disappear for a week or more. Sometimes he would be there in the morning and be finished by midday. He denied that funding or finance for the job was a reason for its delay and said that he was paying the builder when money was requested because of his inexperience even though the job was not progressing. The general tenor of his evidence conveyed the impression that he lacked experience in building having done anything like this project previously. 15MO explained that they signed the contract in September because RR said there would be no more delays once it was signed and he promised it would be finished in a couple of months . 16MO's statement or evidence in cross examination by Ms Quinn did not indicate voluntarily any information relating to contact with RR between January 2012 and receipt of the written quote on 28 May 2012 consistent with his claim that RR had said on 8 January "I'll have a look and I'll let you know". 17MO conceded in answer to my questioning that he had met RR on site again on 26 March 2012 with the engineer Mr Clemensen. However he denied that he had any discussions with RR about use of the existing slab as a means of saving cost. When asked why the engineer Zahoul was not contacted by RR, MO said that RR did not trust other engineers and would contact his own, namely Clemensen. 18Upon further questioning MO conceded that there were discussions about the slab to the extent that he asked RR in relation to where the piers in the Zahoul design were to be placed . To which RR had answered that: "they can go on top, but I will need to get in touch with my engineer". 19MO also denied that he had a fixed budget for the job and said that he just wanted done for a "reasonable amount" but said that he did not mention anything about budget to RR. He denied more than once in his oral evidence that RR had ever mentioned the figures $160,000.00 to $170,000.00. 20MO says that he had no previous contact with RR in 2011 although he conceded there was a telephone discussion within the few days or week before the 8 January 2012 meeting took place. 21The statement of Johanna Ocana (JO) was also in evidence and it is noted that her written statement largely mirrored that of her husband's. In cross examination she said that although she was fully involved with the engagement of the builder in as much as she was present at the meetings; she conceded that most of the talking was between RR and her husband because she was with the kids .JO indicated that the meeting on 8 January 2012 took about an hour. JO said she thought that because he was a family man RR could be trusted. When they signed contract similarly she said when RR said that signing the contract would fix the delay she trusted him. She became concerned in January 2013 when water started entering her home.

THE BUILDER'S LAY EVIDENCE 22The builder's lay evidence is contained in the statement dated 6 February 2014 of RR, together with his oral testimony at the hearing. 23In his statement RR indicated that in about October 2011 he had provided a verbal quote to the homeowners for an amount of $150,000.00 to $170,000.00 based on the drawings provided by the homeowners. He says around January 2012 the homeowners then requested the work to be done for under $100,000.00.Following Mr Clemensen providing his report of 26 March 2012 confirming that the works could be built off the existing slab, RR says that a written quote dated 29 March 2012 based on the reduced scope for an amount of $104,500.00 was then provided to the homeowners. 24RR confirmed that construction commenced at the premises on 12 June 2012 and on that day demolition of the rear part of the house and other work took place. He says further that the contract was not signed until 3 September 2014 because the homeowners delayed it while they were trying to organise further funding from their bank. He claimed that they had been unable to obtain finance at various stages of the works which caused the builder to leave the site on three occasions. 25Between about November 2012 and about March 2013 RR asserts that the homeowners requested a substantial number of variations some of which are listed in attachment E to his statement. On 8 March 2013 he says that he received a text message from MO advising him to come and collect his tools and to leave the site. 26RR was cross examined by Ms King firstly in relation to the claim that he had first met with the homeowners in about October 2011. He conceded that he did not have a written record of this meeting but he remembered that it was well before Xmas 2011. He was shown plans at this time, both design drawings and engineering plans, which were not endorsed with the DA consent at the time .He met with them again a number of times after Xmas, firstly he thought in about February when he said that the homeowners indicated that they had other quotes as well but they were all about the same around $150,000.00 and RR claimed that they said that they could not afford it and they asked if he could help them to get the cost reduced. It was at this time in response that he told them that $20,000.00 to $30,000.00 could be saved in not having to get rid of the concrete slabs .They then requested that this alternative be explored, because they had just spent money in having the concrete laid as it was going to be for a garage and they did not want that money to be wasted. RR said that MO then said that he would have to have an engineer look at the possibility of building off the existing slab. 27Ms King then sought to tender an alleged quote from the builder dated 8 January 2012 which indicated a price of $88,000.00 plus GST. There was no objection from Mr Smith to the tender even though it had not been served previously. This document was identified as "HO Exh 1". RR denied that this quote had ever been given by the builder implying that it could have constructed by someone else. He explained that he was positive it was not a document prepared by him because it had his email address at the bottom next to his signature which was something he never did. When asked how could someone else use the builder's letterhead he simply said his emails were often sent unprotected .He later explained on further questioning from me regarding "HO Exh 1" that the purported offer contained far too little detail to be an offer prepared by him . He said "it did not make any sense". 28In further questioning by Ms King regarding the appointment of Mr Clemensen RR asserted that it was MO that contacted Mr Clemensen after RR had provided contact details to him. RR explained further that it was necessary to explore different engineering options to the Zahoul plans because the homeowners did not have enough money to use the Zahoul method .Following obtaining the revised engineering option from Mr Clemensen RR says that it was MO that liased with the Council which provided a revised approval to allow the job to proceed building off the existing slabs 29When later questioned by me regarding the absence of any mention of the Zahoul plans in the contract , RR confirmed that it was clearly agreed before the work proceeded that the only way the job could proceed to save on cost and within the offer indicated , namely , the $104,500.00 was for job to be on the existing slab . He said that MO understood and agreed to it. 30Ms King further put to RR that it was not credible having regard to the manner in which Mr Clemensen's report of 26 March 2012 was addressed, given that it stated the builder's address and then said "Dear Robert" clearly directed to RR, that it was MO and not RR who retained Mr Clemensen. RR repeated that he had given the contact details to MO and he did not know why the letter was addressed in the manner indicated. 31Ms King also questioned RR in relation to the manner and date of delivery of the 29 March 2012 quotation letter to which he initially responded that he thought it was emailed around the time it was dated. It was then put to him that it was not emailed on MO's evidence until 28 May 2012. RR's response was that he did not understand why it would be dated 28 March if it was not provided to the homeowners around that time. He then suggested he may have given it to them personally. 32RR was also questioned at length about the written contract which he agreed had not been provided to the homeowners until a couple of months after work had commenced .He said that he had given the form of printed contract to them and that some of the details written on it were put there by the Ocanas . He says that completing it was delayed because they were unable to get their finance approved. RR claimed that MO had asked him to complete it in a certain manner to assist with getting the finance approved but he refused indicating that he would not do anything to mislead the bank even though Mr Ocana had requested it. 33Ms King questioned RR in detail about various aspects of the contract and had him identify those parts that were written by him and those parts written by the Ocanas. Arising from this, the issue as to the progress payments schedule was discussed. Another document prepared by the builder but not served was put to RR, namely a schedule of payments .RR explained that he had prepared it but MO had given him the figures to include in it for the purpose of the bank. 34The issue of delay in the progress of work was raised and RR indicated that this was because of funding problems after the bank finance was approved. The bank would have to approve payments and this sometimes took three to four weeks after the claim was made. The earlier payments were quicker in the period before September 2012 because the homeowners had told him that they got a personal loan for $50,000.00 first because the bank had recommended it be done that way .They were able to disburse that $50,000.00 as if it were their own money as this did not require the bank valuer to value the work before a payment could be made. The builder had unclear recollection as to the precise works that had been completed at various intervals but he stressed the bank would only release funds in accordance with what it determined to be the value of the work that had been completed .In the period between June and September a reconstruction of what work was carried out was described , which suggested a certain amount of demolition within the existing premises , the temporary laundry , all of the piers and foundation and the extension framing including the roof . RR also indicated that payments for forward orders of material were also included as part of the initial cost. 35Ms King asked RR about the claimed variations and whether there had been any written agreements pursuant to Clause 13 of the contract with respect to them to which he agreed that there had not been. Similarly he conceded that there had been no compliance with Clause 7 of the contract regarding Extensions of time. Even though he conceded the contract had not been followed he insisted that MO had requested and agreed to the work in respect to all the variations. When Ms King questioned RR about the subsequent agreement which arose out of the first CTTT proceeding he said that the reason he sought this agreement was that it was a means for him to get some payment for the variations.

THE HOMEOWNERS' EXPERT EVIDENCE 36The homeowner relies on the report of CW Henstock and Associates engineers dated 28 November 2013 together with the oral testimony of Mr Henstock , the report dated 22 July 2013 from Victor Ramirez , building inspector as well as his oral testimony and a memorandum dated 4 September 2013 from Stephen Poulter, coordinator -fire and building regulation with Fairfield Council . 37Mr Henstock in his report summarised the position indicating upon his visual inspection that all the piers / footings for the extension have been founded on an existing concrete ground slab on the South side or on a new concrete ground slab on the North side of the building .It was his expressed view that the slab on the South side had structurally failed in two areas and differential settlement had occurred across the failures. The depths of each slab and the extent of reinforcement within them was not known. It was not possible therefore to certify the structural adequacy of the slabs .He also indicated that the airspace between .the floor of the addition and the top of the concrete slab was less than 400 mm and therefore in breach of the BCA requirement which stipulates that a 400 mm gap is required. 38In his oral evidence Mr Henstock indicated that he would be unable to certify the structural integrity of the slabs without a geotech report and core samples of the slabs .He was asked how what existed presently differed from the Zahoul drawings to which he advised that the footings were on concrete and not in ground , were of lesser dimension and the piers ranged in height from 70mm to 270 mm well below the 400 mm stipulated requirement .He also indicated that the bearer sizes were less than stipulated by the code .He said in cross examination that that if there is structural failure of the concrete it cannot be fixed . He said that it could be sealed to prevent intrusion of water and the cracks could be sealed but such steps would not rectify it if it was structurally unsound. 39Mr Ramirez provided a detailed report in relation to the various items alleged as effects. He also gave oral evidence and was cross examined by Mr Smith. I do not propose to summarise his evidence in relation to each of the items in the schedule as I will deal with them all apart from item three in the decision below. However in relation to item 3 of the schedule of defects , a finding consistent with Mr Ramirez view would render the other items irrelevant .Item 3 relates to the clearance from the subfloor to the bearers supporting the floor of the extension . Mr Ramirez refers to the BCA Table in Section 3.4.1.2 of the Code which is headed "Subfloor Ventilation and Clearance". He states that it requires a minimum clearance of 400 mm which has not been achieved by the builder, providing photos illustrating the existing condition. On the basis of this alleged breach of the Code he expresses the view that the whole extension is incapable of rectification other than by being dismantled and done again. 40In cross examination by Mr Smith, Mr Ramirez conceded the following: (1)That 400 mm clearance is required for the purpose of inspection (2)That the subfloor is in its present state capable of being inspected electronically using appropriate equipment. (3)That he was not aware of the exception permitted to the clearance required as set out in BCA section 3.1.3B (ii)F relating to termite treated timber under which provision the minimum clearance is 150mm . 41The report of Mr Poulter from Fairfield Council is a document which does not comply with the code of conduct with respect to expert evidence. It is certainly admissible as a business record but its weight having regard to not being code compliant and to the fact that its author was unavailable for cross examination, must be significantly less than any of the other expert evidence. It is a useful document in as much as it illustrates by photographic evidence the non-compliances it purports to indicate. It clearly provides confirmation that unless these non-compliances can be rectified or otherwise certified as compliant that the premises in its stated condition as at the time of Mr Poulter's inspection would not pass council certification.

THE BUILDER'S EXPERT EVIDENCE The builder relies on only one expert namely Mr Clemensen. Mr Clemensen certified in his report of 26 March 2012 that the extension could be constructed on the existing slabs and he was aware of the levels involved because the homeowners wanted to retain the same floor height in the extension as the existing premises .Mr Clemensen was dogmatic in his opinion that the demolition of the extension was not necessary and that lots could be done to stiffen the floor. His view is that there is sufficient visibility for termite risks to be assessed even with a 50 mm gap given the availability of photographic equipment. He considered that the concrete was sound when he certified it and since it was sloping it would allow water to run off and therefore there would not be a problem with moisture. He is prepared to certify it as compliant on the basis of the "deemed to satisfy" provisions of the code .He considers that the matters raised by the council in the Poulter report are minor matters and can be addressed by the builder .

FACTUAL ANALYSIS 42As with all disputes of this nature the facts upon which the outcome is formulated are determined on the basis of the most credible evidence available which is filed and served in the proceedings together with that which can be elicited through the hearing process .Such formulation often has to boil down to preferring the testimony of one witness over that of another. 43At the time the builder alleges he was excluded from the site and before the first Tribunal proceedings and the subsequent agreement, the evidence clearly establishes that there were certain defects/ incomplete work and that position is not disputed .The builder says that the works were mainly incomplete and that he was prevented from completing them by either lack of money (for the variations) or by being excluded from the site. 44The homeowners assert that there were no variations as none were agreed to in accordance with the contract provisions but in any event all work claimed to be incomplete should have been carried out by the builder within the original scope of works . 45The competing factual scenarios are essentially as follows:

The Homeowners' Version 46The homeowners' submission as put by their legal representatives is that they first had contact with the builder in January 2012, firstly a phone call up to as much as a week before a meeting on the 8 January 2012 at the site. This meeting was followed by a quote from the builder in writing dated that day (HO EXH 1) but received by the homeowners via an alleged email dated 9 January 2010 at 6.21.24 PM for an amount of $88,000.00 plus GST 47The builder then arranged for his own engineer Mr Clemensen to look at the site on 26 March 2012. Mr Clemensen then provided a report to the builder dated 26 March 2012 certifying it was appropriate to build off the existing slabs .The builder then provided a second written quote to the homeowners dated 29 March 2012 which is alleged to have only been provided to them by email on 28 May 2012 .The second written quote was for a higher price than HO Exh 1 namely $104,500.00. The latter quote was accepted by the homeowners and work commenced on 12 June 2012 in accordance with that agreed price and the agreed scope as set out in detail in the offer letter dated 29 March 2012. The homeowners kept asking the builder to sign a contract but he kept delaying it until after many phone calls he eventually provided it for signature on 3 September 2012. 48It is also contended that the homeowners had $50,000.00 in savings and that this money was used to fund the works in the period initially until the bank loan to fund the balance was obtained. They assert that the builder did not progress the job in accordance with the terms of the contract to complete it within 12 weeks. They contend that the builder simply did not attend the site for long periods.

THE BUILDER'S VERSION 49The builder through RR was contacted by the homeowners sometime in or around October 2011, whereupon RR met with them at the site and was given a copy of the unstamped plans from the architects TransPacifica and Zahoul Engineering. RR discussed cost of their project indicating a figure in the region of $150,000.00 to $170,000.00 was likely. RR was contacted again in 2012, he thought around February and he met again with the homeowners at the site. RR alleges that at this meeting they advised him that they had received quotes for around $150,000.00 from other builders but they could not afford that much and they asked him if they could help to get the price down under $100,000.00. RR says that he indicated that $20,000.00 to $30,000.00 could be saved if he did not have to remove the concrete and he could build from it . 50RR asserts that the homeowners wished to explore this alternative and at his suggestion MO contacted MR Clemensen with contact details provided to him by RR. After Mr Clemensen's report of 26 March 2012 was received, MO liased with Fairfield Council to have the DA approval amended to allow the extension to build off the slabs in accordance with Mr Clemensen's report recommendation. 51Having received the revised engineering details in Mr Clemensen's report of 26 March 2012, RR says that he then prepared the detailed quote dated 29 March 2012 , which he thought that he had forwarded to the homeowners by email .He did not know and could not explain why he would not have provided this quote to them shortly after it was dated but accepted that if the homeowners email stated it was only sent on 28 May 2012 he could not dispute that because he could not remember something two years back . 52Once he had provided the later quote and the price was agreed, even though the homeowners did not have their bank finance approved to fund the full project MO wanted to get started on the preparatory stages as quickly as possible using the $50,000.00 he stated that they had already obtained by way of a personal loan . RR asserts that it was the homeowners that did not want to sign a formal contract until they had finalised approval with the bank to fund the balance of the contract amount. 53RR says that the delays after September 2012 were caused by the bank taking weeks to pay the claims after they were in fact made, the fact that the homeowners decided to remain residing in the house while the renovations were occurring and the many variations to the agreed scope which the homeowners had requested .He also claimed that there were weather delays which at least affected the completion of the agreed works after the further agreement was reached at the Tribunal. 54RR claims that he had a good relationship with the homeowners and that because of that he did not see any need to follow the formal requirements of the contract with regard to variations and extensions of time.

WHICH VERSION SHOULD BE PREFERRED 55Having outlined the foregoing competing scenarios the conclusion the Tribunal reaches as to which is the more credible is dependent upon assessing one or other of the parties to be more believable. The difficulty I have with the homeowners' version is that there is simply too much evidence missing in light of the evidence given to make it believable. 56 MO's evidence was that there was only ever one written quote from the builder, namely that dated 29 March 2012 and this is consistent with both his and JO written statements. MO repeated in his evidence also more than once the following: (RR said it would cost) "$70,000 to $80,000 but I'll have to work on it". 57MO also confirmed in cross examination that the only written quote he had received from the builder was for $104,500.00 by email on 28 May 2012. He repeated this statement on a number of occasions. None of this evidence is consistent with the alleged existence of a second written quote from the builder, namely HO Exh 1. There is no prior notice of such document in either of the statements of MO or JO. HO Exh 1 , indeed quotes a figure less than the one subsequently agreed upon. It quotes a figure less than the one subsequently agreed upon the basis of "the drawings supplied" which consistent with what had been supplied at that time included both the TransPacific design drawings and the Zahoul Engineering drawings. In other words it quoted a lower price for the full scope of work required originally without the need to build off the slabs. 58It is claimed in the homeowners' legal submissions received following the formal hearing that HO Exh 1 was received via email dated 9 January 2012 at 6.21.24 pm, an email that has never before been filed mentioned or produced in evidence. 59HO Exh 1 was tendered by Ms King in cross examination of RR. Its use or tender was not the subject of any objection by Mr Smith, presumably on the basis that it was assumed to be an authentic document and as a business record of the builder one could assume to be of great relevance even if not previously served .RR's denial of its authenticity one might have thought would have led to an application to recall the homeowners to explain it but this did not occur. It is also noted that one of the basis for the denial of its authenticity by RR was the fact that HO Exh 1 offered a greater scope of work than the 29 March 2012 quote subsequently agreed upon. 60It is just not credible that HO Exh 1 is authentic because it provides a quote for less than $100000 to do the job using the drawings as existed at the time not the revised engineering following the Clemensen inspection on 26 March 2012 .Why would the homeowners not have accepted the offer contained in HO Exh 1 if it had been made as alleged, given that they subsequently accepted a later offer for a higher amount with a lesser scope of work. This simply makes no sense and would make the whole purpose of Mr Clmensen's inspection and report redundant. 61As to the date on which the subsequent quote was received, it is noteworthy to mention that the claim that this quote was only sent with an email dated 28 May 2012 is not substantiated as there is no such email tendered in the homeowners' bundle of evidence or previously in the material filed with the Tribunal. 62MO claimed in his oral testimony that he had no real budget although he did mention $110,000.00, but then said he just wanted the job done for a reasonable amount. He said that he had $50,000.00 in savings yet it was RR's evidence that he had told him that he had got a personal loan for $50,000.00 and it was that money which was available to be used to enable the project to be commenced. 63It is also of relevance that an assertion was made in the homeowners written submissions as follows: "Mr Ocana received a quotation from Sam Construction Company Pty Ltd .... Dated 23 November 2011 in the amount of $107796 plus GSTwhich included 'excavate piers according to Structure Engineer details plans" 64The latter document to which Ms King refers is certainly not in evidence in the proceedings; it is not anywhere to be found in the homeowners' tender bundle and it was not separately tendered and it does not appear to have been filed in the documents with the Tribunal. MO in his oral evidence in answer to a question from me did refer to a previous quote for that amount, but there was no re-examination regarding this point. This is but another example of missing evidence which leaves a doubt as to whether this assertion is true. 65MO presented himself as a person with no previous experience with building work. He denied that he had conversations with RR about changes to the scope to allow building from the slab in order to get the price down. He claimed that he did not understand anything about the engineering aspect. MO did not volunteer the evidence that he had personally engaged subcontractors to lay the new concrete slab sometime in 2011, some relatively short time before this project commenced. He did concede that he did not want to see the money they had spent on that slab wasted by having to rip it up. This information was not in his evidence; it emerged as a consequence of the questions which I directed to him. It is certainly of relevance to his credibility that MO was able to organise to lay a concrete slab himself using subcontractors yet he claimed he was a complete novice. 66As regard the builder Ms King has submitted that RR was not a credible witness and should not be believed. Two aspects of RR's evidence highlight the attack on his credibility. Firstly, the fact that Mr Clemensen did not confirm that he had been instructed directly by the homeowners as claimed by RR and secondly the date of the 29 March 2012 quotation being provided by email only on 28 May 2012 when RR claimed initially that it was provided earlier. 67My overall assessment of which scenario outlined above at paragraphs 47 to 55, should be preferred is that offered by the builder. Contrary to Ms King's submission I found the builder to be a candid and straightforward witness who answered questions and volunteered information freely. He said he did not remember dates well and he did not keep good records such as a complete daily diary of all activities .He could not recall with certainty when the 29 March 2012 quotation was sent but considered it odd that he would have kept it for two months. 68His recollection of what occurred with Mr Clemensen is that he simply gave Mr Clemensen's contact details to the homeowners so that MO could explore an alternative engineering solution that may bring the price down. Mr Clemensen in his oral evidence has a different recollection as to who gave him instructions and the documents would clearly suggest that it was the builder /RR not MO. 69These two issues upon which Ms King relies in supporting her claim that RR was " not a credible witness in that his evidence was vague at best or untruthful at worst" are not consequential. 70The facts are plainly not in question that Mr Clemensen went to the site and inspected it in the presence of both the MO and RR on 26 March 2012 and whether this meeting was arranged by MO or RR does not detract from the purpose of that inspection, which I find was well known to both the homeowners and the builder. 71As to the question of the date upon which the 29 March 2012 quotation was sent and received, the relevance of its determination is not material to its substance. Such quotation was relied upon as the basis for the contract for the agreement between both parties, freely entered, for the works to be undertaken. 72Even if RR's claims are vague or inaccurate with respect to these two procedural aspects, the substance of the evidence they concern does not change and such vagueness or inaccuracy can at least be explained on the basis of lack of memory or poor record keeping. 73The aspects of the homeowners' evidence which are in conflict relate to the substance of the evidence rather than its process and are inexplicable on the basis of poor memory after two years or lack of record keeping. My assessment of MO was that he was vague about evidence and reluctant to volunteer information. There is no doubt that he claimed on many occasions that there was only one written quote , yet a second one , namely HO Exh 1 is now relied upon . Further the purported reliance on a number of documents , which are not in evidence which claim to corroborate MO's testimony , is just not good enough to satisfy me to the required standard of proof , that whether or not the building work undertaken by the builder pursuant to their agreement was competently and efficiently performed by it , this builder was nevertheless genuinely seeking to assist the homeowners to achieve the project they wished to complete by trying to find a way to perform it for a price which they could afford and that it was doing so because they had personally sought RR's assistance to help them . 74My conclusion is therefore that having fully considered all the evidence I find that RR's testimony is the more truthful as the various inconsistencies outlined with regard to the homeowners' evidence are incapable of being reconciled.

DECISION 75The Scott Schedule (SS) prepared by Mr Ramirez sets out the various items which are the subject of the dispute between the parties. Having regard to the expert evidence I make the following findings in relation to the various items (except for Item 3 which is addressed separately at the end) in the SS as follows: Item 1 - The roof. Irrespective of whether water is currently penetrating this is considered to be a defect which requires rectification. A specific cost for wider capping and additional fixings has not been submitted in evidence. Item 2 - The Laundry .This is clearly incomplete work and needs to be completed / rectified. A specific costing has not been submitted for this item. Item 4 - The rear sliding door needs to be installed and work associated needs to be completed. Once again the cost has not been specifically submitted. Item 5 - The external cladding .The architectural plans specify that the external cladding is to match the existing dwelling and refers to the use of "Hardiplank". There is no specific costing submitted to complete the external walls in accordance with the specified requirements. Item 6 - Old roof tiles still in situ .Mr Ramirez confirms that the original roof tiles which have been left in the roof cavity following placement of the new Colorbond roof constitutes a defect because it restricts access within the roof cavity .He has indicated that this defect can be rectified by creating two access holes to remove the tiles . The cost of doing so has not been estimated by him nor is the subject of a quote Item 7 - Rubbish removal is clearly the responsibility of the builder and constitutes incomplete work. A costing on the rubbish removal has not been specifically claimed or otherwise identified. Item 8 - The ensuite bathroom .The two holes in the tiles of the ensuite bathroom wall are clearly defects. Mr Ramirez says that anything penetrating the waterproof membrane is a major defect and requires significant repair work. The two methods of repair he suggests would have significantly different costs. The first method involves removing the shower screen and the damaged tiles and redoing the subsurface waterproof membrane then replacing the tiles and screen. The second method is a quick fix with the use of a Sikaflex sealant and doing some surface repair. Neither method has been the subject of a specific costing to enable a determination of which in the circumstances is reasonable. Item 9 - The main bathroom has not been completed. This was part of the builder's scope of works. Mr Ramirez specifies $12000 as the cost to complete it. However no details as to how this figure is arrived at are given. The figure seems high for such a renovation. A quotation detailing all costs involved in completing this bathroom is required before any determination could be made. Item 10 - The kitchen benchtop is damaged with a small chip from the edge . Although there is no evidence as to the cause of this chip I find it more probable than not that it is the responsibility of the builder .Mr Ramirez did concede that the chip may be capable of repair although it may be less than ideal. Without specific quotes as to repair of the chip or replacement of the benchtop, it is not possible to determine which course should be adopted as the most reasonable. Mr Ramirez estimated replacement of the benchtop would be $2,000.00 Item 11 - The step in the kitchen / family room tiled floor is a defect which the builder had agreed to repair in the settlement of the earlier Tribunal proceedings .Mr Ramirez was not aware as to who is responsible for this defect but he did concede it is capable of being rectified . Once again there is no specific evidence as to cost and method of repair so as to assess the reasonableness of same if appropriate.

ITEM 3 Item 3 - Subfloor Clearance. The matters identified in the Poulter report need to be rectified or completed so that council compliance can be obtained. The cost of addressing outstanding issues has not been specifically submitted as a separate cost .The reason is of course that the opinion of Mr Ramirez, (calling for demolition of the works and a total rebuild to follow in accordance with the Zahoul Engineering plans following removal of the concrete slabs) is relied upon. Consequently the homeowners make no claim in respect of the individual items as they are all rendered redundant if the relief sought in respect of Item 3 is granted. 76In relation to Item 3 it must be remembered that Mr Ramirez conceded in giving evidence that he was not aware of BCA section 3.1.3 B(ii)F which provides an exception to the clearance height allowances where termite inspection is not required and that this situation can be applied where termite treated timber is used .. None of the other experts, neither Mr Henstock nor Mr Poulter have expressed a view that such an outcome should occur. Mr Henstock at best says he is unable to certify the integrity of the slabs without some destructive testing being performed. So his opinion at best is inconclusive on this issue. 77Whilst Mr Poulter says that the foundations do not comply with the code he does not indicate that rectification works would be incapable of changing that position. His opinion is similarly inconclusive and indeed silent on the issue of demolition and rebuilding, thus it does not assist the homeowners in their claimed relief. . 78Mr Clemensen says categorically that he is prepared to certify the extension and that it certainly does not need to be demolished. Ms King's challenge to his oral testimony because it was permitted to be given over the telephone and hence involved some disadvantage to the cross examination even if accepted , I find does not alter the clear substance of the views expressed by Mr Clemensen which have been clearly articulated in the various letters from him in evidence ..Mr Clemensen has also provided a solution to each of the issues raised in Mr Poulter's report with regard to rectification. 79Having regard to the expert opinion overall I find that it falls well short of establishing to the required standard of proof the homeowners contention for demolition and rebuild of the extension. 80I further find that the homeowners in any event knew and instructed the builder to build off the slab for the good reason that they could not afford to build it otherwise. They also knew full well that the agreement entered with the builder never included reference to the Zahoul Engineering plans and its requirements for removal of the slabs and excavated piers. 81Whilst I find that there was a clear instruction and agreement with the builder to follow the method recommended by Mr Clemensen to build off the slabs it was still encumbent upon the builder to do so in a way that complied with the relevant codes .I am satisfied that the various failures which have been identified with regard to the piers /supports / slabs are capable of rectification at a cost .Such costs have not been particularised or indeed claimed in the alternative to the only relief sought namely monetary compensation for the demolition and rebuild of the whole extension. 82The homeowners' claim is as submitted by Ms King for an order that the builder pay an amount to cover the costs of demolition and a rebuild together with an order for legal costs of these proceedings. I do not propose to make such an order relating to demolition and rebuilding, as for the reasons outlined I am not satisfied such a case has been made out. Ms King does not propose any alternative relief or seek any alternate amount in the event that the claimed relief is not accepted and therefore application as framed must be dismissed. 83The order to dismiss the application is of course in part consistent with the submission by Mr Smith.He also argues that the builder has an entitlement to a claim under quantum merruit in respect of the variations which it has particularised because this work has been done and the homeowners will have the benefit and therefore will be unjustly enriched. No evidence is tendered by him consistent with the principle in Pavey and Matthews Pty Ltd v Paul [1987] HCA 5 which would enable the Tribunal to determine the reasonableness of any such claim and more importantly no formal cross claim has ever been made on behalf of the builder with respect to it and therefore such a claim is not one that is appropriate to consider in such circumstances. I therefore propose to make no finding or order with respect to this aspect of Mr Smith's submission. Norman Correy Senior Member Civil and Administrative Tribunal of New South Wales 10 June 2014 I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 21 August 2014