In these proceedings the applicant seeks indemnification from the respondent in connection with any liability that may be found against him in HB 15/64016. These proceedings were commenced on or about 2 August 2016.
The fact briefly, are that the applicant is a builder and the respondent is an engineer. In these Reasons I will refer to the applicant as the builder and to the respondent as the engineer. The builder built a residence for home owners in 2009. The engineer prepared a geotechnical report and a footings and slab plan for the residence, as constructed by the builder.
There is no dispute that the builder's claim against the engineer is a building claim for the purposes of the Home Building Act 1989 (the 'Act') 1989 and that the Tribunal has the jurisdiction to hear and determine the claim.
The proceedings were heard in Lismore over 4 days in May and November 2017 concurrently with HB 15/64016.
Both parties were legally represented. Counsel appeared on their behalf at the hearing.
The evidence in the proceedings was:
1. Exhibit A, 2 volume bundle of documents;
2. Exhibit B, AS 2870 - 1996;
3. Exhibit C, photograph of drain;
4. Exhibit D, Curriculum Vitae Mr J Niland;
5. Exhibit E, construction inspection report;
6. Exhibit G, resume Mr Hammond;
7. Exhibit H; QCAT Board of Professional Engineers v Hammond and
8. Exhibit I, photographs of premises (formerly 'MFIA').
In HB 15/64016 I found for the reasons provided that the owners engaged the engineer to prepare a geotechnical report and a footings and slab plan for the residence. I adopt the same reasons in order to make the same finding in these proceedings.
The builder filed and served Points of Claim dated 8 September 2016 alleging that the owed a duty of care to the builder which he breached and that the engineer engaged in conduct that was misleading or deceptive or likely to mislead or deceive in breach of section 42 of the Fair Trading Act 1987. The engineer did not file a defence to the Points of Claim. Nonetheless his position was set out in written Outline of Submissions and Final submissions.
The engineer contends that the builder's claim against him is out of time. I will deal with that issue first. The engineer submits that the builder's claim against him is for pure economic loss and that the cause of action accrues when the damage occurs, not when the damage becomes known. The engineer further submits that if there was damage, which he denies, it accrued at the time of the provision of the allegedly defective design on or about 8 May 2009. He relies on Winnote Pty Ltd & Anor v Page & Ors (2006) 68 NSWLR 531. On this basis the engineer submits that any claim brought against him after 8 May 2015 (allowing a period of 6 years) is statute barred. As stated in [1] the proceedings were commenced on or about 2 August 2016.
I accept the engineer's evidence that he prepared his plan and geotechnical report in May 2009 and issued an invoice for his work on 8 May 2009.
The builder has addressed the time issue in his written submissions. He states in connection with his tort case against the engineer that the limitation period does not start to run until the defects become manifest or are otherwise discovered. In that regard he relies upon Cyril Smith & associates Pty Ltd v The Owners-Strata Plan No 64970 [2011] NSWCA 181. In that case the Court of Appeal stated at [21] that it was necessary for it to follow the decision of the Victorian Court of Appeal in Pullen v Gutteridge Haskins & Davey Pty Ltd [1993] VicRp 4; [1993] 1 VR 27 that time would run case when the latent defect first became known or manifest. The evidence in these proceedings was that defects of a structural nature became known or manifest in August 2014, refer to the owners statement dated 27 June 2016, paragraph 20. I accept that evidence.
The time period of 6 years referred to by the parties no doubt arises under the relevant provisions of the Limitation Act 1969 and the Fair Trading Act. However considerations of those limitation periods overlook specific provisions in the Act which deal with the jurisdiction of the Tribunal in relation to building claims.
As 2 August 2016 the date the proceedings were commenced, Division 4 of the Act stated at section 48K(3):
'The Tribunal does not have jurisdiction in respect of a building claim relating to building goods or services that have been supplied to or for the claimant if the date on which the claim was lodged is more than 3 years after the date on which the supply was made (or, if made in instalments, the date on which the supply was last made).'
I stated above that there was no dispute that the builder's claim is a building claim for the purposes of the Act.
Building goods or services are defined in section 48A of the Act as follows:
'building goods or services means goods or services supplied for or in connection with the carrying out of residential building work or specialist work, being goods or services:
(a) supplied by the person who contracts to do, or otherwise does, that work, or
(b) supplied in any circumstances prescribed by the regulations to the person who contracts to do that work.'
I find that the work carried out by the engineer may be described as building services. I find that the services were the provision by the engineer on or before 8 May 2009 of a geotechnical report and a footings and slab plan for or in connection with the carrying out of residential building work, namely the construction of the residence to which I have referred in HB 15/64016. I also find that the building services were supplied to the builder notwithstanding that I have found that the builder did not contract with the engineer for the supply of those services. The supply of the building services to the builder took the form of them being provided in accordance with item 14 of Schedule 1 to the building contract entered into between the builder and the home owners and also in accordance with item 2 of the builder's tender. In addition the builder's own evidence leaves no doubt that he received the engineers footings and slab plan
I also find that builder's building claim relates to the building services that I have referred to above and that the date the builder's claim was lodged, 2 August 2016 was more than 3 years after the engineer's geotechnical report and footings and slab plan were supplied to the builder.
As a result of the findings in the preceding paragraphs, I find that the Tribunal has no jurisdiction to hear and determine the builder's claim in these proceedings.
I find that it is necessary to dismiss the builder's claim on the basis of section 48K(3) of the Act, despite the fact that section has not been referred to in the parties submissions. The fact that the parties have not referred to that section is not in my opinion an appropriate reason to ignore a relevant provision of the Act dealing with the Tribunal's jurisdiction.
[2]
Costs
I make the following orders regarding the costs of these proceedings.
Any costs application must be lodged in the Tribunal and served on the costs respondent within 21 days of the date of these orders either attaching or referring to any documents relied upon in support of the application.
The costs respondent will have 21 days after the date it receives the application referred to in the preceding paragraph to lodge in the Tribunal and serve on the costs applicant its submissions in response to the cost applicant's costs application, such submissions either attaching or referring to any documents relied upon.
The cost applicant will have 14 days after the date it receives the cost respondent's submissions to lodge in the Tribunal and serve on the costs respondent its submissions, if any, in reply, such submissions either attaching or referring to any documents relied upon.
Subject to the right of the parties to make submissions under section 50(3) of the Civil and Administrative Tribunal Act 2013 for a hearing on costs (which should be made in conjunction with the submissions referred to above), the Tribunal will determine any costs application on the basis of the papers lodged in the Tribunal.
D Goldstein
Senior Member
Civil and Administrative Tribunal of New South Wales
8 March 2018
[3]
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: 02 July 2018