Application for leave to review decision and review heard together - Whether claims under s 12A of the Builders' Registration Act 1939 (WA) limited to disputes between owner and builder - Applicant the owner of the adjacent property

Builders' Registration Act 1939 (WA), s 2, s 4A, s 12A, s 12A(1), s 12A(1)(a), s 12A(1)(b), s 12A(1a), s 41(2)

Home Building Contracts Act 1991 (WA), s 17(1)

State Administrative Tribunal Act 2004 (WA), s 63, s 63(2)

State Administrative Tribunal Rules 2004 (WA), r 18, r 29

Commodore Homes (WA) Pty Ltd and Austin & Anor [2005] WASAT 292

Craig, Williamson Pty Ltd v Barrowcliff [1915] VicLawRp 66; [1915] VLR 450

Tangent Nominees Pty Ltd and Edwards & Anor [2005] WASAT 119

1 The applicant applied for leave to review a decision of the Building Disputes Tribunal (made on 22 July 2005 dismissing the applicant's complaint on the basis that the Disputes Tribunal did not have jurisdiction under s 12A(1) of the Builders' Registration Act 1939 (WA). The Disputes Tribunal held that s 12A(1) of that Act did not permit a claim to be entertained by the applicant in respect of alleged faulty and/or unsatisfactory building work carried out on an adjoining property.

2 The complaint was that a soakwell had been constructed within 1.8 metres of a retaining wall which divided the two properties. It was alleged that this was in breach of the building licence and the by-laws.

3 While the respondent had been engaged by the adjoining owner to carry out the building works, the installation of the soakwell had been removed from the scope of works to be undertaken. The soakwell had been installed by the adjoining owner personally.

4 The Tribunal found that the Disputes Tribunal had erred in its interpretation of s 12A and that section was wide enough to permit the applicant to make a complaint. However, the applicant failed to demonstrate that a substantial injustice would result if the decision was not reversed, because on the facts, the Tribunal considered that the claim against the respondent was doomed to fail. The respondent had not carried out the alleged unsatisfactory building works and it was therefore not possible for the Disputes Tribunal to make an order against the respondent. The Tribunal accordingly dismissed the application for leave to review the Disputes Tribunal's decision.

5 This is an application for leave to review a decision of the Building Disputes Tribunal made on 22 July 2005. The Disputes Tribunal held that it was not open to the applicant, as an owner of an adjoining property, to bring a claim under s 12A of the Builders' Registration Act 1939 (WA) (the BR Act) in respect of alleged unsatisfactory building work carried on the neighbouring property.

6 Leave to review the decision is required pursuant to s 41(2) of the BR Act. The application for leave and the review itself were set down for hearing together on 24 January 2006.

7 The respondent failed to appear at the hearing. The Tribunal file shows that notice of the hearing was sent by ordinary prepaid post to both parties on 22 November 2005. A telephone call made by a Tribunal staff member to the representative of the respondent who had appeared at an earlier directions hearing was unsuccessful. The Tribunal was informed that the representative had left the office to attend a meeting and that his mobile telephone was turned off. Nevertheless, an attempt would be made to contact him and have him telephone the Tribunal.

8 As the Tribunal considered that proper notice had been given to the respondent pursuant to the requirements of s 63 of the State Administrative Tribunal Act 2004 (WA) (SAT Act) and in terms of r 18 and r 29 of the State Administrative Tribunal Rules 2004 (WA), the Tribunal proceeded to hear the matter in the absence of the respondent pursuant to s 63(2) of the SAT Act.

9 The applicant is the owner of a residential property known as 30 Fairlight Street, Mosman Park.

10 A building licence was issued to the respondent to carry out building work on an adjoining property known as 3 Thelma Street, Mosman Park. The applicant contends that the building licence and/or by-laws require that any soakwell not to be placed within 1.8 metres of a common retaining wall separating the two properties. On the documentation provided, the basis for this assertion is not clear.

11 The applicant asserts that a soakwell was placed within 1.8 metres of the retaining wall, which is a matter of concern because over time he fears that the discharge of water into the soakwell, and from the soakwell into the surrounding soil, will result in the undermining of the retaining wall.

12 The applicant confirmed to the Tribunal, that, as set out in a chronology provided by the applicant, both a supervisor engaged by the respondent and the then owner of the property (it having since been sold to the present owner) had stated that the then owner, a Mr Lindquist, had installed the soakwell. The applicant accepts that to be the case.

13 On 31 January 2005 the applicant lodged a complaint with the Disputes Tribunal.

14 A jurisdictional question was identified, namely, whether the applicant, as the owner of the adjoining property to that on which the building works had been carried out, was entitled to bring a claim under s 12A of the BR Act. The matter was set down for a determination of that matter on 10 May 2005. The respondent failed to appear at that hearing as a result of its representative being ill. The Disputes Tribunal proceeded with the hearing. After a clarification of the factual situation, the Disputes Tribunal concluded that the hearing should be adjourned in order to hear from the respondent. The transcript reflects that the Disputes Tribunal was then disposed to find that it had jurisdiction, subject to the right of the respondent to have its say.

15 The hearing of the jurisdictional issue was accordingly adjourned to 18 July 2005 before the Disputes Tribunal which was differently constituted, notwithstanding that the Deputy Chairperson hearing the matter indicated that a direction would be made for the matter to be brought back before her as it had been part heard. At the hearing on 18 July 2005, the Tribunal took a different view of the matter from the outset and shortly thereafter, on 22 July 2005, issued its reasons for decision dismissing the application for want of jurisdiction.

16 The Disputes Tribunal first examined the jurisdiction conferred on it pursuant to s 17(1) of the Home Building Contracts Act 1991 (WA) (the HBC Act). As it found that the complainant did not fall within the definition of owner, meaning in relation to a contract the person for whom or which home building work is to be performed, the HBC Act could not apply.

17 The Disputes Tribunal then turned to an examination of the jurisdiction conferred under s 12A(1) of the BR Act. It is convenient to set out the decision in full from this point.

"9. Jurisdiction is also conferred on the Tribunal by the Builders' Registration Act 1939. Section 12A(1) provides:

'Where on complaint being made to it by any person, including the Board, the Disputes Tribunal is satisfied that any building work has not been carried out in a proper and workmanlike manner by reason that the building work is faulty or unsatisfactory the Disputes Tribunal may by order in writing served on the person who carried out the building work order him to -

(a) remedy the faulty work [sic] unsatisfactory [building] work within such reasonable time as is specified in the order; or

(b) pay to the owner of the building such costs of remedying the building work as is faulty or unsatisfactory as the Disputes Tribunal considers reasonable in which case any costs so ordered by the Disputes Tribunal constitute a debt to the owner and are recoverable by him in a court of competent jurisdiction.'

10. A literal interpretation of this section may indicate that the remedy however could be sought by anyone, based on the words used '... by any person ... '. This interpretation would not, however, be consistent with the purpose of this Act disclosed by its provisions generally or indeed the section quoted above. It is clear that the remedies in this section are directed only to the owner of the property concerned [sic]

11. Section 18 of the Interpretation Act 1984 provides that:

In the interpretation of a provision of a written law, a construction that would promote the purpose or object underlying the written law (whether that purpose or object is expressly stated in the written law or not) shall be preferred to a construction that would not promote that purpose or object.

12. Further guidance is gained from the judgment of Dawson J in Mills v. Meeking [1990] HCA 6; (1990) 91 ALR 16 at 30 - 32. His Honour is of the view that the equivalent Commonwealth legislation encourages a purposive approach to interpretation (s.15AA Interpretation Act 1901 (Cwlth). This is so where there are competing interpretations.

13. The purpose of the Builders' Registration Act 1939 is stated in its long title to be:

An Act relating to the qualifications and registration of builders; to constitute a board in relation thereto; to establish a tribunal with jurisdiction in respect of certain building disputes, and for other purposes connected therewith.

14. It is clear that the purpose of the Act disclosed by its terms is to create a Tribunal to determine disputes between builders and those occupying their buildings, and not a general jurisdiction in regard to all building disputes.

15. Accordingly, the Tribunal is of the view that there is no jurisdiction to hear the complaint and ordered accordingly."

18 The applicant pointed to the wide language used in s 12A permitting a complaint "by any person" as opposed to the more restrictive language used in s 12A(1a) enabling a complaint to be made "by a person for whom building work has been carried out". It was contended that there was no reason to read the words down in s 12A(1).

19 Further, the applicant submitted, that it made no difference that the soakwell in question had been installed by the owner. The applicant submitted that the work was authorised only under the building licence and therefore the builder, namely the respondent, was responsible for it. The applicant conceded that it was disputed as to whether the soakwell had been installed before or after completion of the rest of the works.

20 As already stated above, the documentation provided to the Tribunal, does not establish all of the terms on which the building licence was issued, nor the application of any by-law, relevant to the positioning of the soakwell.

21 In the Tribunal's view, there is no force whatsoever in the applicant's contention that it does not matter that the soakwell was installed by the owner. Section 12A(1), as set out above, clearly empowers the Disputes Tribunal only to make an order on the person who carried out the building work. The circumstances in which the owner, Mr Lindquist, came to install the soakwell are not established, but one way or the other, the work, if it was within the original contract, which seems probable, was removed from the scope of works to be undertaken by the respondent. The respondent therefore cannot be held responsible under s 12A(1) of the BR Act. Whether the respondent has any obligation to notify the local authority of the removal of such work from the contract, so that the local authority, could pursue whether a separate building licence was necessary, is another matter.

22 In order to obtain leave to review the decision, it is necessary for the applicant to show that the decision under review was plainly wrong, or attended with sufficient doubt, such that a substantial injustice would result if the decision were to be left unreversed: Tangent Nominees Pty Ltd and Edwards & Anor [2005] WASAT 119. In the above circumstances, the applicant is unable to show that any substantial injustice would result because if leave were to be granted, the claim against the respondent is doomed to fail for the above reasons. The application for leave therefore falls to be dismissed.

23 The determination of the jurisdictional issue nevertheless remains of significance. Subject to the Disputes Tribunal having jurisdiction, on the above reasoning, it would be open to the applicant to lodge a fresh claim against the owner of the property who carried out the building work. It is therefore appropriate that the Tribunal express its view on the interpretation of s 12A(1), particularly, as its application is a matter of general importance.

24 In par 10 of the Disputes Tribunal's reasons for decision, the conclusion is stated that a literal interpretation would not be consistent with the purpose of the BR Act disclosed by its provisions generally or by s 12A(1) itself. No reference has been made to the other provisions which have been relied upon as the basis for this conclusion and it is not possible for this Tribunal to identify them.

25 The Disputes Tribunal continued, in par 10 to conclude that it was clear that the remedies in s 12A are directed only to the owner of the property concerned. In par 14, the Disputes Tribunal concluded that the purpose of the Act disclosed by its terms is to create a Tribunal to determine disputes between builders and "those occupying their buildings" and not a general jurisdiction in regard to all building disputes. Again, there is no specific reference to any provisions of the Act to support these conclusions.

26 It is no doubt correct that the BR Act regulates the registration of builders and establishes a Tribunal for the resolution of disputes with builders, whether they be registered as builders, or are unregistered persons who have conducted building work. "Builder" is defined by s 2 to mean a person who trades as a builder. Section 4A permits a building licence to be issued in certain circumstances to unregistered persons. It is therefore not surprising that s 12(1a) is expressed in terms which permit the Disputes Tribunal to make an order, not against the builder, but against the person who carried out the building work.

27 That expression includes therefore, a person who is not registered as a builder. The Disputes Tribunal's conclusion that the purpose of the BR Act is in part to determine disputes between "builders and those occupying their buildings" is at the very least inexact. While the reasons for decision do not adequately explain the basis for the conclusion that the remedies in s 12A are directed only to the owner of the property concerned, subsection 12A(1)(b) might be read as providing some support for this conclusion. However, in the Tribunal's view, any such conclusion would be erroneous. Section 12A(1) by its terms, makes it plain that a complaint may be made "by any person, including the Board". There is no prerequisite that the complaint must be made by the owner.

28 There is a public interest in the Builders' Registration Board of Western Australia (the Board), presumably through its inspectorate, being able to identify unsatisfactory building work, perhaps in circumstances in which it might constitute a risk to the public safety. In such circumstances, the Board could initiate the proceedings to ensure that the unsatisfactory work is remedied, if necessary, even against the will of the owner. The appropriate remedy in such circumstances, is an order to remedy the faulty or unsatisfactory building work in accordance with s 12A(1)(a).

29 While s 12A(1)(b) contemplates an order being made for payment to the owner of the building of the costs of remedying the building work that is faulty or unsatisfactory, relief of that nature would obviously be inappropriate in a case initiated by the Board.

30 By contrast, as submitted by the applicant, there is a distinction between s 12A(1)(a) under which a complaint can be made by any person and the complaint permitted under subsection 12A(1a), which must be made "by a person for whom building work has been carried out". Under s 12A(1a), there is also a choice of remedies between either an order to remedy the work which has not been carried out in a proper and workmanlike manner, or an order to pay to the person for whom the building work was carried out, the costs of remedying the building work or such sum of money as the Disputes Tribunal considers reasonable by way of compensation for the failure to carry out the building work in a proper workmanlike manner.

31 It is a principle of construction, as stated in Craig, Williamson Pty Ltd v Barrowcliff [1915] VicLawRp 66; [1915] VLR 450 at [452], that

"[A]ny document should be construed as far as possible so as to give the same meaning to the same words wherever those words occur in that document, and that that applies especially to an Act of Parliament, and with special force to words contained in the same section of an Act. There ought to be very strong reasons present before the Court holds that the words in one part of the section have a different meaning from the same words appearing in another part of the same section."

32 See further the authorities cited in DC Pearce and RS Geddes Statutory Interpretation in Australia 3rd ed Butterworths, Sydney, 1988.

33 The converse is that where legislation has used different words, particularly in the same section of an Act, it must be assumed to have intended that a different meaning apply.

34 It is readily apparent from a consideration of s 12A read as a whole, that the legislature has used language to distinguish who can make claims and to whom various remedies are available. Under s 12A(1)(b) an order may be made for payment to the owner of the building. By contrast, in subsection (1a) either an order to remedy, or an order for payment of compensation can be made but only in favour of the person for whom building work has been carried out. This subsection applies where the building work is not faulty or unsatisfactory, but has not been carried out in a proper and workmanlike manner. An example of such a claim might be where a builder constructs a room to smaller dimensions than those shown on the plan. Driving a vehicle with a very heavy load too close to the edge of a retaining wall was held to constitute a failure to carry out building work in a proper and workmanlike manner in breach of this subsection in Commodore Homes (WA) Pty Ltd and Austin & Anor [2005] WASAT 292.

35 Where building work is not faulty or unsatisfactory but has not been carried out in a proper and workmanlike manner, the legislature has chosen to limit the power to order a remedy so that relief can be given only to the person for whom the building work had been carried out. Under subsection (1) an order to remedy building work which is faulty or unsatisfactory is not, on its face, subject to the same limitation. The legislature must be taken to have intended this distinction.

36 If subsection (1) was intended to be construed in the manner determined by the Disputes Tribunal it would have been an easy matter for the legislature to have provided "Where upon complaint being made to it by the owner of the building, or the Board".

37 There appears to be good public policy reasons for the different language used. As already stated above, an inspector of the Board may in the execution of his duties observe defective building work which puts public safety at risk. Further, there may be occasions when an adjoining property owner is more adversely affected by faulty or unsatisfactory building work than the owner of the building or even the person for whom the building work was carried out. Where a property is developed with an intention of on-selling, the owner may well be prepared to accept building practices which would not be acceptable, if the owner intended to reside for any length of time in the property. To illustrate [on the parts] of this case, the previous owner will not be affected by any problem that may arise from the location of the soakwell.

38 The Disputes Tribunal recognised that a wider application of s 12A(1) was supported by a literal interpretation of the section. That wider interpretation remains entirely consistent with the purpose of the BR Act and is supported by the language of s 12A(1a) as discussed above. The Disputes Tribunal erred in construing s 12A(1), as it did, to restrict those who could make a claim to the owner of the building.

39 However, although the Disputes Tribunal's decision is wrong, for the reasons stated above, the claim is doomed to fail by reason that the work which is the subject of the claim was carried out by the owner not by the respondent builder. The Disputes Tribunal has power to make an order only against the person who carried out the building work. In these circumstances, it cannot be demonstrated that a substantial injustice would result if the decision were not to be reversed.

40 It is nevertheless open to the applicant to make a fresh claim in the Disputes Tribunal against the then owner of the property who carried out the building work in question.

41 For the above reasons, the Tribunal orders as follows:

1. The application for leave to review the decision of the Building Disputes Tribunal made on 22 July 2005 is dismissed.

I certify that this and the preceding [41] paragraphs comprise the reasons for decision of the State Administrative Tribunal.

___________________________________

MR C RAYMOND, SENIOR MEMBER