Zhang v Todd [2019] QCAT 208

[7] The relevant enabling Act in respect of the present dispute is the Queensland Building and Construction Commission Act 1991 (Qld) ('QBCC Act').

[8] The tribunal has jurisdiction to hear and decide building disputes.[4] A building dispute may be a domestic building dispute, a minor commercial building dispute or a major commercial building dispute.[5] A domestic building dispute includes a dispute between a building owner and building contractor relating to the performance of reviewable domestic work or a contract for the performance of reviewable domestic work.[6] Both 'building contractor' and 'building owner' are defined in the QBCC Act.[7] Reviewable domestic work means domestic building work under s 4 of Schedule 1B of the QBCC Act. The renovation, alteration, extension, improvement or repair of a home is domestic building work.[8] A home is a building or portion of a building that is designed, constructed or adapted for use as a residence.[9]

[9] A domestic building dispute also includes a claim or dispute in negligence, nuisance or trespass related to the performance of reviewable domestic work, other than a claim for personal injuries.[10]

[10] In deciding a building dispute the tribunal may award damages and may order the payment of an amount found to be owing by one party to another.[11]

The statutory framework - bringing Tribunal proceedings to an early end

[11] Proceedings in the tribunal may be brought to early end. Where the tribunal considers a respondent in a proceeding, without reasonable excuse, is acting in a way that unnecessarily disadvantages the applicant by not complying with a tribunal order or direction, the tribunal may make its final decision in the proceeding in the applicant's favour.[12]

[12] I find that:

• (a) the work Mr Todd agreed to undertake, and undertook, was domestic building work;[13]

• (b) Ms Zhang is a building owner and Mr Todd is a building contractor;

• (c) the dispute between the parties is a domestic building dispute;

• (d) the Tribunal has jurisdiction to hear and decide the dispute;

• (e) service of the application for domestic building dispute has been properly effected upon Mr Todd.[14]

[13] Mr Todd was directed on a number of occasions to file a response to Ms Zhang's application and has failed to do so. These directions included a direction to file a response to Ms Zhang's application by 6 July 2018, failing which Ms Zhang would be entitled to a final decision in the proceedings. I am satisfied that Mr Todd has failed to comply with a Tribunal direction without reasonable excuse and, in doing so, has acted in a way that unnecessarily disadvantages Ms Zhang. The disadvantage to Ms Zhang is that she is being prevented from having the matter decided. Mr Todd has offered no explanation for his failure to comply with Tribunal directions. Indeed, he has failed to engage in any way in the proceedings. I have considered the matters set out at s 48(3) of the QCAT Act. Mr Todd's familiarity with Tribunal practices and his capacity to understand directions are matters upon which I am unable to form any assessment given Mr Todd's failure to engage in the proceedings which it appears is a deliberate action by him. I am satisfied that it is appropriate to exercise my discretion and make a final decision in the proceeding in favour of Ms Zhang.

[14] I turn now to a consideration of Ms Zhang's claim.

[15] In Ms Zhang's statement of evidence she says that Mr Todd was unlicensed when he entered into the agreement to perform the building work and at the time he performed the building work.[15] By s 42(1) of the QBCC Act, a person must not carry out, or undertake to carry out, building work unless the person holds a contractor's licence of the appropriate class under the Act. By s 42(3) of the QBCC Act, a person who performs unlicensed building work is not entitled to any monetary or other consideration for doing so. Any monetary or other consideration paid to an unlicensed builder must be repaid.[16]

[16] In support of her assertion that Mr Todd was unlicensed, Ms Zhang relies on a letter from the Queensland Building and Construction Commission dated 31 January 2018 and a photograph of Mr Todd's building licence showing an expiry date of 18 August 2016. In the letter, the QBCC does not say that Mr Todd was unlicensed when he performed the building work. The photograph relied upon may be evidence that Mr Todd possessed, at a point in time, a building contractor license expiring on 18 August 2016. It is not evidence that he did not hold a license after that date.

[17] Ms Zhang has not filed a copy of Mr Todd's QBCC licence history. In conducting a proceeding the tribunal may inform itself in any way it considers appropriate.[17] A search of Mr Todd's license on the QBCC licensee database reveals that Mr Todd held a valid QBCC license up until 4 September 2017 at which time Mr Todd's licence was suspended.[18] Accordingly, I find that Mr Todd was licensed at the time he entered into the agreement with Ms Zhang.

[18] Attached to Ms Zhang's original application for a building dispute are copies of numerous text messages passing between Ms Zhang and Mr Todd. It is unclear from the text messages whether any building work was performed by Mr Todd after 4 September 2017. In the absence of any cogent evidence I am unable to conclude that Mr Todd performed building work when he did not hold a contractor's licence.

[19] A home owner who enters into an agreement with a building contractor for the performance of building work and who sustains loss arising from the performance of the work in a defective and/or incomplete manner may make a claim against the building contractor for breach of contract. Where the breach of contract is established the homeowner is, as far as money can do so, entitled to be placed in the same situation with respect to damages as if the contract had been performed.[19] The measure of damages recoverable by a building owner for breach of a building contract is the difference between the contract price for the work and the cost of making the work conform to the contract, subject to undertaking the work necessary to achieve conformity being a reasonable course to adopt.[20] In assessing damages, allowance must be made in favour of the building contractor for any unpaid balance of the contract price.

[20] A domestic building contract, where the contract price is more than $3,300 and less than $20,000 is a level 1 regulated contract.[21] By s 13(2) and s 13(5) of Schedule 1B of the QBCC Act, a level 1 regulated contract, in order to have effect, must be in writing, must be dated and must be signed by the parties.

[21] The agreement entered into between the parties does not comply with the requirements of s 13(2) of Schedule 1B of the QBCC Act. The quote supplied by Mr Todd is neither dated nor signed.

[22] By s 44 of Schedule 1B of the QBCC Act, unless a contrary intention appears in the Act, a failure by a building contractor to comply with a requirement under the Act in relation to a domestic building contract does not render the contract illegal, void or unenforceable. The minimum statutory requirements for a level 1 regulated contract are not onerous, requiring the contract to be in writing, dated and signed by the parties. The legislature has however made clear that unless those requirements are met, the contract is of no effect. Section 13(5) of Schedule 1B is the clear expression by the legislature of an intention that the failure to meet the requirements of s 13(2) has the result that a contract is of no effect and is thereby void.

[23] The agreement between Ms Zhang and Mr Todd does not satisfy the requirements of s 13(2) and thus has no effect.[22] As there is no regulated contract between the parties, the implied warranty provisions contained in the QBCC Act also do not apply.[23]

[24] Ms Zhang has no entitlement to claim against Mr Todd for breach of contract.[24]

[25] As I have observed a domestic building dispute may include a claim or dispute in negligence relating to the performance of reviewable domestic work.[25] An applicant must establish the following in order to succeed in a claim for negligence:

• (a) the respondent owed to the applicant a duty of care;

• (b) the respondent breached the duty; and

• (c) as a result of the breach of duty the applicant has suffered loss.

[26] I find that Ms Zhang relied upon Mr Todd to perform the building works with appropriate care and skill. Ms Zhang was in this regard 'vulnerable' in her dealings with Mr Todd.[26] I find that it was reasonably foreseeable that if Mr Todd failed to exercise appropriate care and skill in performing the building work that Ms Zhang may suffer loss and that Mr Todd owed to Ms Zhang a duty of care to perform the building work in an appropriately skilled and competent manner.

[27] Mr Todd agreed to, inter alia, cut and remove the front broken section of the driveway and supply and lay a new concrete driveway. In her statement of evidence, Ms Zhang says that Mr Todd removed the existing concrete driveway at the property leaving dirt and rubble. The photographs relied upon Ms Zhang support this contention. The driveway, such as it is, is unformed and incomplete. I find that Mr Todd has failed to perform the building work relating to the removal of the previous driveway and the construction of the new driveway in a proper and workmanlike manner in breach of the duty owed to Ms Zhang.

[28] Mr Todd agreed to supply and install a custom made colorbond sliding gate to match the colorbond fence. Ms Zhang says that Mr Todd has failed to install the driveway gate.[27] It is not alleged that Mr Todd has performed the work in a less than proper and workmanlike manner. Rather, Mr Todd did not perform the work at all. That is a contractual issue. Ms Zhang is not entitled to pursue any contractual remedies against Mr Todd. She is limited to what is recoverable in tort for breach of duty by Mr Todd, the measure of which is placing Ms Zhang in the same position as she would have been in had there been no breach of duty by Mr Todd. Mr Todd's failure to install the gate is not a breach of the duty he owed to Ms Zhang to perform the works in a proper and workmanlike manner.

[29] Mr Todd agreed to supply and install a new colorbond fence. Ms Zhang says that the "[f]ence panels were not sealed and the poles not capped". In support of her statement Ms Zhang provides photographs depicting fence posts without capping and with what appear to be misaligned fencing panels. The fencing constructed by Mr Todd, and as depicted in the photographs, appears to be incomplete in that the tops of the fence posts are not capped. What Ms Zhang means by the fence panels not being 'sealed' is unclear. There is no evidence before me to assist in understanding or clarifying this submission. I am prepared to find that the fence has not been constructed in a proper and workmanlike manner in relation to the failure to properly cap the fencing posts. I am not prepared to make any findings as to the manner in which the fence panels have been erected in the absence of cogent evidence to support such a finding.

[30] The learned authors of Brooking on Building Contracts 5th edition state:

In Kaze Constructions Pty Ltd v Housing Indemnity Australia Pty Ltd, von Doussa J confirmed that the 'object of an award of damages in tort is to restore the plaintiff to the position in which it would have been placed if the wrongful act had not been committed'. This extends to building cases. Damages may include the cost of rectification and the diminished value of a plaintiff's property after rectification.[28]

[31] In respect of the work to complete the construction of the driveway Ms Zhang attaches to her statement a copy of a contract with Frezno Enterprises.[29] The work performed under the contract includes the construction of a concrete driveway including a kerb cut and the installation of a gate runner. The contract price, paid in full by Ms Zhang, is $3,982.00. I allow this amount in full in respect of the rectification of the driveway.

[32] In respect of the work to complete the installation of the automatic gate, Ms Zhang relies upon a quote from Habitat Screens & Decor dated 25 June 2018[30] for $4,700. The quote is for the supply and installation of an aluminium automatic sliding gate. Ms Zhang provides receipts for payment of the full amount to Habitat. I have concluded that Mr Todd's failure to supply and install the gate is a contractual matter, and, not being defective work, does not constitute a breach by Mr Todd of the duty of care he owed to Ms Zhang. As Ms Zhang has not established a breach of duty in respect of this part of the claim, I do not allow any amount in respect of the installation of the automatic gate.

[33] In relation to the fencing panels and fencing posts, Ms Zhang says in her statement that there is a '(p)otential cost of more than $500 to fix the fencing panels and poles.' Ms Zhang offers no evidence to support her claim. I have found that Mr Todd failed to undertake the works in an appropriate and skilled manner by failing to install caps on the fence posts. I have found that the evidence in relation to the installation of the fencing panels is insufficient to make any findings that Mr Todd breached his duty of care to Ms Zhang. I am prepared to allow $100 in respect of this part of the claim.

[34] Ms Zhang claims in her statement that the poor state in which her driveway was left resulted in damage to one of the tyres on her car. She claims $353.00. In support of her claim she provides two receipts, both of which are dated 28 February 2018.[31] One receipt is for $160.00 and is from a Tyre supplier. The other is for an amount of $193.00 from the RACQ for "Roadside Standard + Join on road fee".

[35] In order for damages for negligence to be recoverable they must not be too remote from the negligent conduct. That is to say, the damage claimed by Ms Zhang must be of a kind or genus that a reasonable person should have foreseen.[32] This requires a two step process: firstly, categorise the loss by reference to the type or genus; secondly, determine whether a reasonable person in the position of the respondent ought to have foreseen loss of that particular kind.

[36] In respect of the first step, the damage to Ms Zhang's car might be categorised as damage to the applicant's property generally. This category of loss might include the applicant's motor vehicle and other items of personal property. Turning to the second step, in my view it is reasonably foreseeable that damage to the applicant's personal property, including her motor vehicle, might be occasioned by the respondent's breach of duty in demolishing the driveway and not reconstructing it. However the difficulty facing Ms Zhang is that there is no evidence linking the state of the driveway with the damage to Ms Zhang's vehicle other than Ms Zhang's assertion that the front left tyre on her car 'eventually went flat'. I am not satisfied that the evidence supports a finding that the state of the driveway caused or materially contributed to damage to the car tyre requiring Ms Zhang to replace the tyre. The claim for the replacement of the tyre is not allowed. The claim for the cost of 'roadside assist' is similarly disallowed.

[37] Ms Zhang claims the costs of filing the application in QCAT. The Tribunal may award costs in a building dispute.[33] The cost claimed by Ms Zhang is reasonable and necessarily incurred by Ms Zhang in pursuing her legal entitlements. I fix the total costs payable by Mr Todd in the amount of $326.80.

[38] There will be a final decision for Ms Zhang as follows:

[1] Statement of Katherine (Qiyun) Zhang filed 28 September 2018.

[5] Ibid, sch 2 (definition of 'building dispute').

[6] Ibid, (definition of 'domestic building dispute').

[7] Ibid, (definition of 'building contractor; definition of 'building owner')

[12] Queensland Civil and Administrative Tribunal Act 2009 (Qld) ('QCAT Act'), s 48.

[13] QBCC Act, sch 1B, s 4(3), 'associated work'.

[14] Affidavit of Service of the applicant filed 1 March 2018.

[15] Statement of Katherine (Qiyun) Zhang filed 28 September 2018.

[16] Cook's Construction P/L v SFS 007.298.633 P/L (formerly trading as Stork Food Systems Australasia P/L) [2009] QCA 75.

[19] Robinson v Harman [1848] EngR 135; (1848) 1 Ex 850; 154 ER 363.

[20] Bellgrove v Eldridge [1954] HCA 36; (1954) 90 CLR 613.

[21] QBCC Act, sch 1B, ss 1 (definition of 'regulated amount'), 6(1)(a), 7(2); Queensland Building and Construction Commission Regulation 2018 (Qld) s 45.

[24] See for example Basscorp Pty Ltd v Kosik [2007] CCT B411-05.

[25] Ibid, sch 2 (definition of 'domestic building dispute'); Chad Roberts Constructions Pty Ltd v Johnson Tiles Pty Ltd [1993] ABT BC9302692; Sablewell Pty Ltd V Kirstborough Pty Ltd and Ors QBT BC9505897.

[26] Perre v Apand [1999] HCA 36; (1999) 198 CLR 180; Woolcock Street Investments Pty Ltd v CDG Pty Ltd [2004] HCA 16; (2004) 216 CLR 515.

[27] Statement of Katherine (Qiyun) Zhang filed 28 September 2018.

[28] Damien J Cremean, Michael H Whitten and Michael F Sharkey, Booking on Building Contracts (LexisNexis, 5th ed, 2013) 349.

[29] Statement of Katherine (Qiyun) Zhang filed 28 September 2018.

[32] Overseas Tankship (UK) Ltd v Morts Dock & Engineering Co Ltd (The Wagon Mound) [1961] UKPC 1; [1961] AC 388.