Sollazzo v Commissioner of Fair Trading

Legislative scheme

1. Clause 28(1) of the Home Building Regulation 2004 ("HB Regulation") provides: (1) Before a certificate is issued, the Director-General must be satisfied that the applicant: (a) has such qualifications or has passed such examinations or practical tests, or both, as the Director-General determined to be necessary to enable the applicant to do, or to supervise, the work for which the certificate is required, and (b) has had experience of such a kind and for such a period, as the Director-General considers would enable the applicant to do, or to supervise, the work for which the certificate is required, and (c) is capable of doing or supervising work for which the certificate is required.
2. Pursuant to s.25(2) of the HB Act and clause 28(1) of the HB Regulation, the Respondent has established standards for the issue of a qualified supervisor certificate for the category of building in an Instrument dated 3 July 2013 ('the Instrument'). The Instrument requires "at least two years' relevant industry experience in a wide range of building construction work".
3. The Instrument defines "experience" as: experience gained by the applicant as: (a) an employee of; or (b) a person otherwise lawfully engaged by, the holder of a contractor licence authorising the holder to do the class of residential building work in which experience was gained ("the Work"), where during the relevant period, the applicant was: (a) supervised and directed in the doing of the Work by the holder of an endorsed contractor licence or supervisor certificate authorising its holder to supervise the Work; and (b) financially remunerated for the Work.

CONSIDERATION

1. Mr Sollazzo lodged his application for a supervisor certificate on 16 October 2013. Although he satisfied the qualification requirements, his application was refused on the basis that he did not have the required industry experience in a wide range of building construction work for a period of 2 years.
2. The applicant said he had been a director of Pinpoint Constructions Pty Ltd ('Pinpoint') since 2001. He provided a number of references in respect of commercial work he had undertaken either personally or through Pinpoint.

Residential work for Messrs Luong and Pintos

1. In support of his application Mr Sollazzo provided a Referee Report from Alan Loung of Keystone Projects Group Pty Ltd ('Keystone') and from Carlos Pintos of Walter Construction Group ('Walter').
2. Mr Loung wrote of work undertaken by the applicant at Macarthur Anglican School Gymnasium ('Macarthur') between 20 January 2002 and 23 July 2002. However Mr Loung was not himself licensed until 29 November 2007. He also wrote of the applicant having worked for Keystone between July 2008 and December 2008 on the construction of new offices within an existing building at Pyrmont, but this was not residential work.
3. Mr Pintos wrote of the applicant having worked at an address in Glebe between May 2002 and June 2003, and at an address in Zetland between July 2003 and December 2004. As Mr Pintos was not himself licensed until 4 December 2003, only the period from that time may count towards the applicant's experience.
4. As the Instrument clearly requires that during the verified period, the Applicant "was supervised and directed in the doing of the Work by the holder of an endorsed contractor licence or supervisor certificate authorising its holder to supervise the Work", I agree with the Respondent's submissions that the Macarthur work for Mr Luong cannot be counted towards the applicant's experience.
5. Similarly, only the period from the date of Mr Pintos' licence can be taken into account - a period of about 12 months - because Mr Pintos was not, until that time, qualified to supervise him. Therefore only the applicant's work at the Zetland premises can be taken into account.

Residential work for Mr Barnard

1. The applicant also relied on his work for Dennis Barnard of Walter in respect of the same Glebe site about which Mr Pintos had written, in respect of the period May 2002 to June 2003, although the applicant, in his evidence, said that he may have been there only 9-10 months of the project.
2. The applicant explained in his evidence that Mr Barnard was the site manager and there were area foremen under Mr Barnard. Mr Pintos was, at that time, an area foreman. Mr Pintos supervised the contractors and Mr Barnard would go through the areas and have an overview of what the contractors were doing. The applicant said he would discuss the progress with Mr Pintos and Mr Barnard as there were overlapping areas of responsibility. The applicant said he was there daily, as was Mr Pintos. Mr Barnard was there 4-5 days a week. He would speak with Mr Barnard 2-4 times a day, including in relation to major issues such as design issues.
3. The applicant said that Pinpoint had been engaged by Walter and had issued invoices to Walter. At the time the applicant started on the project the building was only a shell, and he had taken it up from the cladding stage.
4. Mr Barnard said his role was overall control of all the subcontractors and there were weekly meetings. Mr Barnard said the applicant worked for Walter

Residential work for Mr Christie

1. The applicant also relied on his work for his brother-in-law, Timothy Christie of Baltac Constructions Pty Ltd ('Baltac') at a residential project in St Mary's.
2. A Referee Statement by Mr Christie dated 29 April 2014 was provided. It details the extent of the work which the applicant performed and the responsibilities he discharged under his supervision. The applicant was involved in: the demolition stage, site excavation, piering and drilling, foundation construction, bricklaying and termite treatment, carpentry and wall framing, plumbing installation, electrical installation, stormwater, and water retention, roof construction, installation, wall lining, waterproofing, and the interior fit out. A number of photographs were provided showing the nature and extent of the works.
3. In addition Mr Christie said in his evidence, he knew the applicant to have built his own home and had been 'meticulous' in its construction. He also knew of the applicant's previous work for Walter and at a number of commercial sites.
4. The reference is dated 29 April 2014, which gives a period of 13 months in total. At the hearing the applicant said that he had continued in this work up to the date of hearing, which provides him with an additional three months, making a total of 16 months.

Total supervised work experience

1. In total, the duration of the applicant's supervised experience is as follows:

• Mr Barnard - 9-10 months
• Mr Pintos - 7 months (December 2003 to June 2004)
• Mr Christie - 16 months (March 2013 to June 2014)

1. I therefore find that the applicant had "at least two years' relevant industry experience".

Was the experience in "a wide range of building construction work"?

1. The Respondent's position was that the applicant's work was not sufficiently broad in scope.
2. As regards the work with Mr Barnard the Respondent submitted, in particular, that the work was limited to internal partition wall framing, ceilings and wall/ceiling linings, external wall faming and cladding.
3. Mr Barnard wrote that the applicant's role included:

• Supervise external eaves framing and linings in accordance with Building Code, Australian Standards, architectural drawings and specifications
• Supervise external fibre cement/compressed fibre cement framing and cladding in accordance with Building Code, Australian Standards, architectural drawings and specifications
• Supervise internal and external wall framing, steel noggings, lining/cladding, wet area wall lining, acoustic insulation, mastic sealant in accordance with Building Code, Australian Standards, architectural drawings and specifications
• Supervise ceiling framing and linings in accordance with Building Code, Australian Standards, architectural drawings and specifications
• Supervise the construction of tenancy fire rated walls, fire rated ceilings, fire rated spandrels and smoke baffles are built in accordance with Building Code, Australian Standards, architectural drawings and specifications
• Supervise the construction of acoustic rated walls and ceilings are built in accordance with the site specific Acoustic Report, Building Code, Australian Standards, architectural drawings and specifications
• Supervise the construction of recessed linear air conditioning openings, plasterboard and fibre cement bulkheads, recessed margins, access panels, glue fixed plasterboard wall lining, acoustic wall lining, installation of timber noggings for fixtures and fittings all in accordance with Australian Standards, architectural drawings and specifications
• Manage the site specific Occupational Health and Safety policy for the project
• Prepare and maintain safe work method statements for the projects in consultation with workers on site
• Supervise workers ensuring safe work method statement are being adhered to
• Carry out periodic site tool box talks with workers
• Apply Building Codes of Australia where required
• Read and interpret architectural drawings, engineer structural plans, specifications, sue specific acoustic and fire report
• Attend site specific contractor meetings with builder and other contractors on site during the course of the project
• Carry out and document quality assurance, inspection/test plans, hold/witness points, identify defects, corrective action, and close out
• Consult with other trade contractors ensure other trades have completed their works at various stages prior to completing the works
• Organise employee payments in accordance with Enterprise Bargain agreements, site specific entitlements and statutory requirements

1. In his evidence Mr Barnard said that the applicant was responsible for all wall framing, linings (both internal and external) and eaves linings. Mr Barnard said that the applicant's work only commenced after the formwork was removed. The applicant had personally undertaken a wide variety of work and also saw other trades at work. He said the work undertaken by the applicant was of a very high standard in the critical stage of construction. He considered that, on the basis of his observation the applicant was equipped to supervise home building. He said because the work at Glebe was for prestige apartments for a very particular client, the applicant was exposed to more than if he had just undertaken individual jobs.
2. In his revised referee statement dated 12 May 2014 Mr Pintos wrote of the applicant's experience at the Zetland premises (a site of about 200 units), and noted an almost identical role to that recorded by Mr Barnard. The Respondent again submitted that, as the work was limited to internal partition wall framing, ceilings and wall/ceiling linings, external wall faming and cladding, it was not sufficiently broad.
3. Mr Degenhardt, Senior Licensing Officer, Licensing Branch, Home Building Service of the Department, said in his evidence that in order to obtain a licence an applicant must also have experience in structural aspects of construction such as formwork, brickwork and a full range of carpentry. While not every residence will require those skills, the licence permits the holder to undertake the full range of activities. In short, the experience must include a broad range of construction and finishing trades.
4. The Respondent referred me to Locking v Department of Finance and Services [2013] NSWADT 239 where the applicant there had only undertaken carpentry and joinery. Hennessey DP observed: 18. A building contractor has the overall responsibility for a site and must be able to supervise all of the trades required to complete any type of dwelling. Additionally a builder must be able to determine that all trades have complied with all standards and requirements. There are many gaps in Mr Locking's trade supervisory experience and therefore his understanding of certain trades. Those trades include flooring, bricklaying, stonemasonry, wet plastering, painting, decorating, general concreting, tiling, demolishing, fencing, glazing and waterproofing. 19.A building contractor is also able to contract with the public, and must therefore be able to negotiate a contract, quote for a project and co-ordinate the trades to be able to complete the project on time and within budget. He or she must also be able to negotiate and discuss the jobs with council and private certifiers to ensure that the work is passed fit when appropriate.
5. I agree that the range of work undertaken for Messrs Barnard and Pintos was somewhat limited.
6. However, as to the 16 months of work undertaken for Mr Christie at St Mary's (which need not be set out further here), Mr Degenhardt conceded in cross-examination that the scope of that work was sufficiently broad to be included in the calculation of the applicant's experience.

In what capacity was the applicant engaged by Messrs Barnard, Pintos and Christie: an employee or "otherwise lawfully engaged"?

1. In Messrs Barnard and Pintos' referee's reports the applicant was described as a 'sub-contractor'. The Respondent submitted that in those circumstances the applicant could not be said to be "otherwise lawfully engaged".
2. Recently in Hale v Commissioner of Fair Trading [2015] NCATOD 1, I discussed in detail whether a person who is supervised by a person who holds an endorsed contractor licence or supervisor certificate in accordance with s.13 of the HB Act, can be "otherwise lawfully engaged", notwithstanding the prohibitions contained in s.4 and s.12 of the HB Act.
3. After the hearing I sought the Respondent's view as to whether Messrs Barnard and Pintos, upon whose supervision the applicant relied, held "endorsed contractor licences" or "supervisor certificates", as defined, in accordance with s.13(1)(b).
4. The Respondent was invited, in the event they did not hold such licence/certificate, to explain how "endorsed contractor licence" referred to in s.13 differs from a "contractor licence", referred to in s.12 and the regime by which an "endorsed contractor licence" (or a "supervisor certificate") is obtained. In providing information that each holds an endorsed contractor licence, the Respondent did not consider it necessary to provide any further response. I therefore find that both held qualifications in accordance with s.13.
5. Mr Barnard said that he had overall control of the sub-contractors and Mr Pintos was a foreman at the Glebe site. Mr Barnard said he held weekly meetings with all the contractors at which any deficiencies would be discussed. The applicant would have observed the other trades and the interaction and co-operation required to get the site progressed. In addition he supervised the applicant's work "4-5 times a day". If contractors were not performing satisfactorily he would "get rid of them". He said that the applicant's company did not schedule its own work; the program was set by Walter and the contractors were expected to meet the timetable. There was scope for the contractor to manage its own staff so that the program would be met, but if they fell behind he would tell them to get more staff. He considered the wide-ranging work undertaken by the applicant that he supervised equipped the applicant to undertake home building. He only supervised the applicant, not the applicant's other employees.
6. I accept that objectively, there was adequate supervision of the applicant provided by Messrs Barnard and Pintos. I find that the applicant was 'otherwise lawfully engaged': per Hale.
7. Mr Christie, in his referee report, described the nature of the applicant's employment (sic) as 'employee'. The applicant said Pinpoint had bought the block of land at St Mary's and had entered into a contract with Baltac as builder, with Mr Christie as supervisor. The applicant said that he also had been a director of Baltac, but was not a shareholder. Because of a family disagreement the applicant and Mr Christie are no longer in a business relationship. Their relationship is now strained.
8. In his evidence Mr Christie said Baltac had employed the applicant and he had supervised him. The applicant was paid by Baltac for his work; Baltac, in turn was paid for the project by Pinpoint. There were no regular drawings either from Pinpoint or Baltac because they needed working capital. Mr Christie also did not take any drawings from Baltac. The premises were eventually completed and sold. As to the nature of the 'employment' Mr Christie said that there was an agreement that they would profit-share in the sale. Mr Christie said that ultimately only Pinpoint benefited. Baltac had received only the costs associated with the materials and labour and the normal builders markup.
9. At the time Mr Christie said he had been a fulltime employee for another construction company. It had been intended that he would work on the site fulltime, but it "didn't work out" so he remained in his fulltime job. He said though that, ultimately, he took responsibility for the project.
10. Mr Degenhardt described the applicant's role in the St Mary's job as an 'owner/builder' and noted that work in such a role cannot count towards the requisite experience. The HB Act does not have the level of sophistication that might reflect the variety of structures in which people contract. Suffice to say, that the structure outlined by the applicant and Mr Christie, did not, in my view, demonstrate that the applicant was the 'owner/builder' of St Mary's. While not free from doubt, it would appear, at least on Mr Christie's evidence, that Mr Sollazzo was employed by Baltac.
11. The Respondent submitted that there could not be an employer/employee relationship because the applicant was not paid a salary and that, from Mr Christie's point of view, the project was in the nature of a partnership as there was to be profit-sharing. Further, the applicant was more appropriately described, it was submitted by the respondent, as an investor. The Respondent could point to no authority for its submission that the applicant needed to draw a 'salary' and that a share in the profits at some later date could not amount to 'salary'.
12. I was referred to Zada v Director-General of Finance and Services, NSW Fair Trading [2014] NSWCATOD 16, wherein SM Frost observed that "the totality of the relationship between the parties must be considered" because the 'label' used by the parties to describe their relationship may be wrong: Stevens v Brodribb Sawmilling Co Pty Ltd [1986] HCA 1; (1986) 160 CLR 16 at 29, cited with approval in Hollis v Vabu Pty Ltd [2001] HCA 44; (2001) 207 CLR 21 at 41.
13. In Zada the Tribunal indicated that supervision and direction are often very relevant to the enquiry as to the relationship.
14. On 20 June 2014, Mr Degenhardt spoke with Mr Christie about Mr Sollazzo's involvement in the St Mary's project. Mr Christie reportedly answered "No" when asked whether he had provided constant supervision and direction to Mr Sollazzo in carrying out the construction work. Mr Christie stated that he was on site "occasionally" - "every couple of weeks". He further stated that "it seems that Mr Sollazzo would need to acquire more experience to get a licence". In his evidence though Mr Christie denied he had provided a negative assessment of the applicant's skills to Mr Degenhardt. He said he had no concerns about the applicant's capacity as a residential builder.
15. In his later statement (dated 10 July 2014) Mr Christie wrote of having complete confidence in the applicant's ability and did not consider there to be any aspect of construction of residential building that the applicant had not had exposure in the course of the building project or that he had at any stage displayed any inadequacy in the skills and knowledge necessary to properly complete such a construction. In his evidence the applicant said that, in addition he and Mr Christie spoke regularly about the site. Mr Christie also referred to ongoing linked emails where he was copied in on correspondence between the applicant and various trades and inspectors. Mr Christie said he was directing the applicant on a day-to-day basis to ensure the work was done properly. He attended as often as he needed to ensure the work was being done correctly. Because he had such a high regard for the applicant's skills he was confident that he needed only limited supervision. Ultimately, he said, he was responsible. He denied he had told Mr Degenhardt that he attended only "occasionally" or "once or twice a week".
16. Although the evidence is somewhat scant, I am prepared to accept that the applicant was an employee of Mr Christie's company, Baltac.
17. Even if I am wrong, and the applicant is not properly to be considered an employee of Baltac, I observe that Mr Christie holds a Qualified Supervisor Certificate. The Respondent submitted that the level of supervision was inadequate and that the HB Act, especially s.53 in respect of improper conduct by nominated supervisors, suggested the supervision should be constant, but could point me to no authority to that effect. I have discussed above the supervision undertaken by Mr Christie, which I find to be objectively adequate.
18. In those circumstances, the applicant was otherwise lawfully engaged, in the work undertaken for Mr Christie.
19. I therefore find that the applicant had at least two years' relevant industry experience in a wide range of building construction work, obtained while he was either an employee of was otherwise lawfully engaged by a person who qualified to supervise him.
20. The Tribunal therefore sets aside the decision under review. 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: 27 March 2015