Ryan v Cornwall [2010] QCAT 212

David John Ryan and Rene Marea Ryan represented by Brendan Cuddihy of Jeffery Cuddihy & Joyce, Solicitors.

1. This is an Application by the applicants, Mr. and Mrs. Ryan that the time for bringing their Application be extended.
2. The respondent, Mr. Cornwall, has also sought orders detailed later in this Decision.
3. For convenience I will refer to the parties as Mr. and Mrs. Ryan and Mr. Cornwall.

1. Mr. Cornwall was the builder and at the time of sale to Mr. and Mrs. Ryan was part owner of a house at 59 Forest Ridge Circuit, Peregian Springs.
2. Mr. and Mrs. Ryan purchased the property from Mr. Cornwall and Trina Mary Cornwall by way of a contract dated 4 February, 2002. Prior to sale, the house had been used as a display home, but never occupied. They occupied the property from March, 2002.
3. Mr. Cornwall states that construction of the house was completed on November, 2001.
4. Mr. and Mrs. Ryan allege that in January, 2009 they became concerned that a large number of tiles appeared to be drummy and that on 3 February, 2009 a pest inspection revealed a suspected failure of the waterproofing throughout wet areas of the house.
5. In February and March, 2009 Mr. and Mrs Ryan removed tiles and found a number of issues which have given rise to their allegations against Mr. Cornwall, that he, or his servants, agents or subcontractors were negligent. The particulars of negligence are set out in the original application filed on 8 January, 2010. The particulars are:
   • (a) failure to perform tiling works throughout the building in a good and workmanlike manner;
   • (b) failure to appropriately waterproof and seal wet areas;
   • (c) failure to use any or any sufficient amount of glue as may be necessary to adhere the tiles to the substate in an adequate manner;
   • (d) failure to use any or any sufficient expansion joints throughout the tiling;
   • (e) failure to properly seal the shower recesses with silicone or any other suitable sealant;
   • (f) failure generally to use proper and appropriate materials, processes and techniques such as would have been used by a tradesman completing the premises and the works in a good and workmanlike manner and in a manner as required by the relevant building standards.

6. Mr. and Mrs. Ryan claim the following damage:
   • (a) cost of repairs to bathroom, ensuite, laundry and toilet $8,285.20
   • (b) cost of repairs to entrance, hallways, living and dining room, kitchen and study $6,715.50
   • (c) cost of supply of 2 shower screens $2,148.79
   • (d) cost of supply of tiles $8,309.42
   • (e) cost of alternative accommodation $1,350.00.

7. Mr. Cornwall denies any negligence and denies any liability for the rectification work. He filed a defence on 3 February, 2010.
8. In the original application filed 8 January, 2010, Mr. and Mrs. Ryan sought an extension of time to make their claim pursuant to section 31 of the Limitation of Actions Act 1974 (LA Act).
9. Mr. Cornwall applied by Application filed on 25 March, 2010 for Orders that:
   • (a) section 31 of the LA Act does not apply;
   • (b) in the alternative the Tribunal find that it has no power to extend the limitation date under the LA Act;
   • (c) the Tribunal find that the time limit for bringing an action under section 51 of the Domestic Building Contracts Act has expired;
   • (d) the Tribunal dismiss the applicants Application numbered BDl010-10.
   • (e) the applicants pay the respondent's costs of these proceedings.

10. By a Response and/or Counter-Application filed 13 April, 2010, Mr. and Mrs. Ryan assert negligence and /or breach of statutory warranties pursuant to the Domestic Building Contracts Act 2000 against Mr. Cornwall as their causes of action. They submit that the Application so far as it relates to a claim for negligence has been started within the limitation period prescribed by section 10(1)(a) of the LA Act. That is within 6 years from the date on which the cause of action based on negligence arose.
11. Mr. and Mrs. Ryan submit that the claim in negligence arose when they first became aware of the lifting tiles in or about September, 2008. The Defence of Mr. Cornwall puts a number of factual matters relating to the allegations at issue which can only properly be dealt with in a hearing. Mr. Cornwall has made no submissions on the question of whether Mr. and Mrs. Ryan's claim against him based in negligence is brought within time.
12. The Response and/or Counter-Application filed on 13 April, 2010 raises for the first time a claim based on breach of statutory warranties pursuant to the Domestic Building Contracts Act 2000. The Response document seeks an extension of time to bring a breach of statutory warranty claim. Mr. and Mrs. Ryan assert that the Tribunal may by the application of section 61 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act), extend the time limited by section 51 of the Domestic Building Contracts Act 2000 for bringing such a claim. Mr. and Mrs. Ryan abandon the original application for extension of time to bring their claim pursuant to section 31 of the LA Act.
13. This Decision will deal with Mr. Cornwall's Application to dismiss the applicants' Application BDL010-10 and his Application seeking an order that the time for bringing an action under section 51 of the Domestic Building Contracts Act has expired. I will also deal with Mr. and Mrs. Ryan's most recent Application for an order that pursuant to section 61 of the QCAT Act the starting of the proceeding in relation to this matter be extended to 1 February, 2010. I will deal with that issue only in respect of the claim against Mr. Cornwall based on breach of statutory warranty.

1. Part 4, division 2, of the Domestic Building Contracts Act 2000 incorporates certain warranties as to suitability of materials, compliance with legal requirements and standard of work and exercise of care and skill, into every regulated contract. A regulated contract includes a domestic building contract for which the contract price is more than the regulated amount.
2. There are no submissions before the Tribunal, nor any facts from which the Tribunal can determine whether there was in this case a "domestic building contract" in the terms of the Domestic Building Contracts Act 2000 into which those warranties could be incorporated. Particular reference needs to be given to sections 7, 8, 13, 30 and 49 of that Act.
3. If the Tribunal were to determine that there is no time based impediment to Mr. and Mrs. Ryan proceeding with their Application based on a breach of statutory warranty, the Tribunal would require further submissions from the parties on this point.
4. Section 51 of the Domestic Building Contracts Act 2000 gives an associated person for a regulated contract the same rights for a breach of a warranty as if the person were the building owner.
5. An "associated person" for a regulated contract, means a person other than the building owner, who is the owner for the time being of the building in relation to which, or land on which, the subject work was carried out.
6. Section 51 of the Domestic Building Contracts Act 2000 provides that a proceeding for breach of a warranty under the Act must be started within 6 years and 6 months after the subject work was finished. Pursuant to the Queensland Building Services Authority Act 1991, this Tribunal has jurisdiction to deal with a domestic building dispute involving a breach of statutory warranties.
7. This Tribunal is vested with its powers by the QCAT Act. Section 61 of the QCAT Act provides:

(a) extend a time limit fixed for the start of a proceeding by this Act or an enabling Act;...

(2) An extension or waiver may be given under subsection (1) even if the time for complying with the relevant requirement has passed.

(3) The tribunal can not extend or shorten a time limit or waive compliance with another procedural requirement if to do so would cause prejudice or detriment, not able to be remedied by an appropriate order for costs or damages, to a party or potential party to a proceeding..."

1. The question at issue here is whether this Tribunal may use the power at section 61 to extend the time which Mr. and Mrs Ryan have to claim damages for alleged breach of statutory warranties by Mr. Cornwall.
2. Relevant to these questions is section 7 of the LA Act which provides that, subject to section 43A, the LA Act does not apply to an action or arbitration for which a limitation period is fixed by or under an enactment other than the LA Act.
3. Section 43A of the LA Act provides:

limitation law means a law (including, but not limited to, this Act) that provides for the limitation or exclusion of any liability or the barring of a right of action for a claim by reference to the time when a proceeding on, or the arbitration of, the claim is started.

(2) A limitation law of the State is to be regarded as part of the substantive law of the State.

(3) This section applies to a cause of action that arose before the commencement of this section but does not apply to a proceeding started before the commencement."

1. The effect of section 43A of the LA Act declaring a limitation law of the State to be part of the substantive law of the State is to automatically extinguish the right on which a claim is based, once the limitation period for bringing proceedings to enforce the right has expired.
2. This is to be compared with a limitation period which is a procedural limitation period. Usually, procedural limitation provisions provide that an action "shall not be brought" after the limitation period has expired. The effect of a procedural provision is to bar resort to the courts for a remedy, but does not extinguish the right on which the claim is based. The right is still recognised by the law. A person who has other legal remedies, not subject to the limitation period, is able to exercise the right.
3. If section 51 of the Domestic Building Contracts Act 2000 was a procedural provision there would be little difficulty in extending the period of limitation expressed in that section, given that the underlying right survives the expiry of the period of limitation. However section 43A of the LA Act makes the provision a substantive provision. The underlying right is extinguished on the expiry of the period of limitation. Express statutory authority is required to revive that right.
4. I do not consider section 61 of the QCAT Act is expressed in sufficiently clear terms to override section 43A of the LA Act. An example of a statutory provision overriding section 43A of the LA Act is section 81 of the Supreme Court Act 1991, which provides, inter alia, that a court may order an amendment to be made even though a relevant period of limitation, current when the proceeding was started, has ended. That section expressly says that it applies despite the Limitation of Actions Act 1974. Other statutory provisions state that where a court makes an order extending a limitation period, the prior expiration of the limitation period has no effect for the purposes of that Act.
5. Section 61 is expressed in its heading to be "Relief from procedural requirements". I do not think that it is directed to reviving expired rights of action. It is rather directed to matters set out in the QCAT Act and its enabling Acts, where time frames are set for machinery provisions of the legislation. The sorts of provisions covered are for example, applications to review a "reviewable decision" which must be made within 28 days. The note to section 33(3) of the QCAT Act indicates this time may be extended by section 61. Similarly it is anticipated by the note to section 143(4) of the QCAT Act that section 61 may be used to extend the 28 day time frame for starting an appeal against a decision of the Tribunal.

1. I find that the period of limitation expressed in the Domestic Building Contracts Act 2000 for commencing a proceeding for breach of statutory warranty expired in approximately September, 2007, but in any event well before the current proceedings were commenced. I am unable to find without further submissions that the matter involves a domestic building contract through which Mr. and Mrs. Ryan have acquired the benefit of any statutory warranties. It is in any event irrelevant given my finding in relation to the period of limitation.
2. I further find that the period of limitation in section 51 of the Domestic Building Contracts Act 2000 is incapable of extension pursuant to section 61 of the QCAT Act.
3. I intend to allow Mr. and Mrs. Ryan to amend their Application to assert a claim in negligence against Mr. Cornwall. Mr. Cornwall may raise such issues in defence as he considers appropriate. Allowing this pleading should not be construed as a finding that such a claim is made within time. That may or may not be a matter to be raised on the defence and determined by a hearing of the evidence.

1. I order that those parts of Application numbered BDL010-10 with respect to an alleged breach of statutory warranty by Mr. Cornwall be struck out, as being out of time.
2. I order that the parties attend a Directions Hearing for the timetabling of steps in this proceeding, including a date for a compulsory conference to be held between the parties.
3. I decline to make any order as to costs.