Zheng v Ianni & Ors

Zheng v Ianni & Ors - [2021] NSWDC 521 - NSWDC 2021 case summary — Zoe

BACKGROUND

On 12 August 2018 the plaintiff (Mr Zheng) was working in the bathroom on the first floor in residential premises at Drummoyne, grouting the wall tiles, when he lost his balance on a step ladder, fell through a void (which was later to become a window and which had been covered with plastic) and suffered physical injuries after plunging about three metres to the ground below. These included injuries to his brain, a lacerated spleen, neck and lower back injuries and a fractured pubic bone. The accident occurred when the residential premises were partly a construction site.
On 11 June 2019, Mr Zheng sued the first and second defendants (Mr Frank Ianni and Ms Caroline Piraino-Ianni, who said she preferred to be called Ms Piraino), as the owners of the site at Drummoyne (the 'Owners'), and the third and fourth defendants (Mr and Ms Daoud), being the identified builders in the contract for construction works [1] (the 'Builders'), for damages for personal injuries. He also sued a fifth defendant (Fred Daoud, son of Mr and Ms Daoud). By his statement of particulars, he made claims for out of pocket expenses, domestic assistance, past economic loss and future loss of earning capacity.
His proceedings against the first and second defendants settled, through which the Owners obtained a consent judgment in their favour. Mr Zheng obtained a default judgment against Fred Daoud, with damages to be assessed. The plaintiff's proceedings against the Builders remain on foot. The particulars of his action in negligence against the Builders essentially amount to the assertion that, in various ways, they (too) failed to take reasonable steps which would have prevented the plaintiff falling through the void.
The Builders, whose Counsel emphasised are now both retired and are pensioners, dispute liability. They say that they had no dealings with Mr Zheng; and that they had no control over who entered or worked on the construction site. Indeed, they say that Nick Daoud had been ordered by Frank Ianni to leave the site in December 2017 after which he ceased performing any works. The Builders say that if they were negligent at all up until the time (in December 2017) that they ceased work, it was the conduct of the fifth defendant (Fred Daoud) and even the Owners themselves, which severed any causal connection between their negligence and the plaintiff's injuries. They say that Fred Daoud (with whom they apparently became estranged from around December 2017) was not their employee, and they provided no authority to him to perform labour work on behalf of their business.
In response, Mr Zheng says that because of the relationship between the third and fourth defendants and the fifth defendant, the third and fourth defendants were vicariously liable for any negligence of the fifth defendant. Accordingly, he says, the third and fourth defendants cannot rely upon any conduct by the fifth defendant as severing any causal connection between the plaintiff's losses and their responsibility.
The Builders did not bring any cross-claim for contribution or indemnity against the fifth defendant (or vice versa), on the basis that they were joint tortfeasors, under s 5(1)(c) of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW). This means that in the event that the Builders are found to be liable to the plaintiff, the Court is not required to consider any comparative culpability or causal contribution that the Builders and Fred Daoud, respectively, had in respect to the injuries and losses suffered by the plaintiff. Nor did they seek contribution against the first and second defendants before the plaintiff settled his claim against those defendants, which thereafter precludes the Builders from seeking contribution against the Owners [2] .
The ultimate liability issue, from this overview, is whether Nick and Leila Daoud are jointly liable, with Fred Daoud, for the losses and injuries Mr Zheng sustained. The issue requires consideration of whether Nick Daoud had any on-going responsibility for the condition of the construction site after he left it in December 2017.
There is no real controversy about what the plaintiff's injuries were immediately following his fall, or even how he fell; although there is dispute about his on-going incapacities. What is primarily in issue, however, is who was responsible for the plaintiff's fall.

[4]

Mr Zheng's evidence

Mr Zheng came to be at Drummoyne in April 2018 after responding to a job advertisement placed in a website tailored to Mandarin-speaking people.
He went to the site at Drummoyne on 12 April 2018. He had not attended this site prior to this day. When he went there to work, he was not licensed as a tiler. He arrived there at about 7:00am in the morning. He had been driven in a car, with two other men. He recalled seeing two other men of Middle Eastern appearance and a construction site which he estimated was 50% complete. He said he entered the property through the rear.
Prior to the accident, he said he received no safety meeting, or instructions as to how to go about work. He said he was told to do tiling. This was initially on the ground floor and that work took a couple of hours. Then he was told to do some grouting in the bathroom upstairs. This he was told by two co-workers. Neither of those co-workers said anything to him about safety on site. Nothing was said about any void in the bathroom covered by any plastic.
Mr Zheng said that when he went to the site, he did not take any helmet or any safety equipment with him.
When he went into the upstairs bathroom, he saw no warning signs or barriers. His co-workers did not give him any verbal warning of any danger. Mr Zheng said that he started grouting on the wall before working his way up until he confronted what he now knew was a window. He used a step ladder to help him ascend to the area where the void was. There was no barrier across it. He did not recall it at the time, but understood from speaking to someone after the accident, that there was plastic sheeting placed across a void. He reached the second or third step on the step ladder before he lost his balance. He fell towards the void, trying to grab something, but was unable to grab anything. The next thing he knew he had lost consciousness until he woke the next morning in Royal Prince Alfred Hospital.
Subject to a qualification, none of this evidence was seriously challenged; and I accept it. The qualification is that there is some doubt about whether he fell unconscious: he apparently told Dr Dalton in July 2020 that he was not left unconscious following the fall.
The first defendant, Frank Ianni, said that once he had returned home after learning about the accident, he did not observe any scaffolding outside the void. It was put to him, but he denied, that he made a payment to Nick Daoud for such scaffolding in early January 2018.
The second defendant, Ms Piraino, did not see the accident, although she indicated that:

the place where he fell was consistent with its being from the bathroom on the first floor;
there was no scaffolding outside the void at the time, although there had been scaffolding weeks and months before.

[5]

The pleadings

There were divergences between the parties' pleaded cases and their eventual arguments which posed difficulties for the Court. This occurred on both sides.
By his pleading, Mr Zheng plainly asserted that the Builders were negligent. In the way that he pleaded the case against them, Mr Zheng contended (paragraph 9) that they were personally responsible (ie directly negligent) for the failure to exercise certain precautions. However, on a strict reading of the pleading, there is no basis in construing Mr Zheng's pleaded case against the Builders as anything other than a case of breach of a general duty of care owed in general law (paragraph 5); as distinct from a non-delegable duty. Nevertheless, although it would have been desirable for the matter to have been pleaded, Counsel for the Builders did not take this pleading point and even, to some extent, addressed the Court on issues of principles relating to non-delegable duty.
Mr Zheng also pleaded (paragraphs 3A and 3B) that the fifth defendant was either an employee, or agent, of the Builders, or had been (independently) contracted by the Owners. This opened the possibility, which the plaintiff subsequently availed himself of, to argue that the Builders were vicariously liable for conduct by Fred Daoud causing injuries to Mr Zheng. But there were no particulars evident in the pleading how Fred Daoud's 'agency' for the Builders arose. Senior Counsel for the plaintiff later explained in his closing argument that the reason for the omission was that the plaintiff was never asked to supply them.
By their Defence to the Further Amended Statement of Claim (filed 19 June 2020), the Builders generally put the plaintiff to proof or otherwise denied the allegations. But beyond doing this, the Builders commonly pleaded the following facts: 1. they had no dealings with the plaintiff; 2. they had no control over who entered or worked on the building site; and 3. (although) they were contracted to do the works, they had ceased doing any works and had quit the site before the 'relevant time'; being when Mr Zheng had his accident.
The third defendant separately pleaded that the First Defendant, Mr Ianni, asked him to leave the site in December 2017 and that he then quit the site, as ordered. The fourth defendant separately pleaded that she was never involved in the building operation nor attended the site.
It is implicit in the pleaded facts that the Builders accept that they were bound by a contract with the Owners (even if the admission did not necessarily extend to accepting the Owners' account of the version of that contract).
In view of the way that the third and fourth defendants conducted their case at trial, it is pertinent to point out matters which were not pleaded in their Defence. Although there was a reference to the Builders actually ceasing their performance of works in December 2017, the Builders did not plead, in terms, that the contract was terminated in accordance with the terms of the contract, that it was assigned to the fifth defendant [3] , abandoned [4] or that it was novated [5] in December 2017.
During the course of Counsel for the Builders' closing oral submissions, after aspects of the Builders' pleading were commented upon by me, the Builders applied to amend to plead that the contract was abandoned, frustrated, or terminated by the Builders, but that application was refused [6] .

[11]

The Building Contract - the different versions contended for by the parties

The Owners entered into a MBA Head contract with the Builders on 27 September 2016. Mr Ianni asserted that this contract comprised different parts (Exhibit A.1 - A.3). In the main part (representing the standard version) although the builders were listed as the third and fourth defendants, Frank Ianni identified that the email and mobile phone details were supplied by Fred Daoud. Fred Daoud was not a party referred to in Exhibit A.1. However, he inserted many of the details in the contract.
Nick Daoud had difficulty accepting that the Owners would likely have interpreted what was recorded as indicating that if the Owners wished to communicate with the Builders by mobile phone they would be ringing Fred Daoud's mobile number and, further, that if they wanted to communicate by email, they would be sending email communications to an email address apparently associated with TGI Homes.
As to another part (Exhibit A.2), this part had been supplied to Frank Ianni by Fred Daoud. It had two distinct documents, titled 'Reference Document 1' and 'Reference Document 2'. Both of these documents were on the letterhead of the third and fourth defendants' business.
Underneath Reference Document 1, the following was written: "This document shall be attached to and be part of the contract for the above mentioned project (a reference to the Drummoyne site) and will take precedence over the plans and other documents attached and part of the contract of works"
Reference Document 1 specified, as subject matter, insulation, air conditioning, pool/plant room, water storage tanks and contractual exclusions. Mr Ianni accepted that Nick's signature was not on this part of the contract; but only Fred's. But he insisted that the contract was with Nick Daoud. He accepted, however, that he did not discuss the content of the contract with Nick. Nick Daoud said that he was the effective author of this document, but had Fred type the information into the document; Fred having the use of a computer which Nick did not have. Nick had seen the plans for the contract by this time. In the document that was in evidence (Exhibit A.2), the initials of Frank Ianni were placed on this document. Fred brought this document back to Nick. Nick applied his signature.
Nick Daoud was referred to part of Reference Document 2, which Frank Ianni had initialled and Nick identified Fred's signature. It was titled 'Reference Document 2' (dated 25 September 2019). Unlike Reference Document 1, there was no statement that it was "part of" the contract, but there was a statement that: "This price (ie $140,000 plus GST) shall be included as part of the HEAD CONTRACT (an expression not defined) with. (sic) the following works to be included."
It covered subject matter such as 'Stairs', 'Painting', 'Tiling', 'External blinds, 'Fencing and decking'. It stipulated a price of $140,000 (plus GST). Nick said he knew nothing about this document. He disputed that his signature or initials were placed on the page that referred to the price. Whilst he accepted that, to some degree, some of the work described had been performed whilst he was on site until December 2017, he said a great deal of it was not. But I consider that he did apply his signature, even if he did not recall doing so.
Exhibit A.3 concerned a table of allowances for Prime Cost Items. Nick Daoud was not asked to give evidence about this document.
Nick Daoud kept the original version of the contract, at least to the extent that it featured the MBA standard version (Exhibit 12) which he said had been sent to him by Fred Daoud. Nick gave evidence that, unlike the version of the contract propounded by Frank Ianni, his version did not contain the Special Conditions (appearing on p 14). As indicated, he did not accept that the part of the contract included Reference Document 2. The only special condition in Mr Ianni's version (Exhibit A.1), which stated: "THE BUILDER MUST OBTAIN FINAL OCCUPATION CERTIFICATE TO ACHIEVE PRACTICAL COMPLETION"
Nick's evidence about this omission from his version of the contract was unchallenged.
Frank Ianni identified both the printing of his name, and signature, and, on its face, Fred Daoud's name was handwritten underneath this condition. Frank did not identify the signature alongside the printing of Fred Daoud's name.

[13]

Comparing the involvement of Nick and Fred Daoud in performing the building works from October 2016 to December 2017

Mr Ianni could not recall whether Fred Daoud turned up on the first day after it was put to him that he did. Mr Ianni said he thought it was "possible" that he did so. It was suggested to Mr Ianni, but he did not recall, that Fred was instrumental in placing a padlock on the gate out the back of the house.
Nick Daoud said that he was on the site daily (Monday to Friday and Saturday mornings) from the mornings (generally 7:00am to 7:45am) to the afternoons (4:30 to 5:00pm) and the works progressed for a period of about 14 months. He said that it was he who unlocked the gate of the fence closing off the site at the rear of the property each morning and it was he who locked it later in the day. He later said in re-examination, that he kept the key to the padlock on the gate out the back; not giving copies of the key to Frank Ianni or Fred. But when he left the site in December 2017, the gate was open. He accepted that, for a time, when he was commencing the works at Drummoyne, he was also completing another project, at Petersham, although by October, this was at the 'finishing' stage; and to the extent that he attended the Petersham site, he said he did so for brief periods (not exceeding half an hour) to speak to the workers.
Frank Ianni said Fred Daoud introduced Nick on site. Mr Ianni accepted that he saw both Nick and Fred Daoud on the construction site. He said that he saw Fred on most days, but perhaps not immediately; Mr Ianni was under the impression that Fred (and Nick) were also working on at least one other site (at Petersham). In this sense, he was joined by Ms Piraino.
The second defendant, Ms Piraino, recalled meeting Nick Daoud before the contract was signed (in September 2016). She recalled observing Nick Daoud more often in the initial stages of the work, until he was joined by Fred Daoud; and then, from 2017, it was "more" Fred. Ms Piraino indicated that from the commencement of the construction works (13 October 2016), she was off work (looking after her baby), before she returned to work, part time in March 2017; before returning full-time in November 2017. She recalled that Nick attended the site until he was unwell; that he came back to the site (for a time) but then did not come back at all. She could not recall whether she saw him again after December 2017. She did not appear to substantially differentiate the amount of time that Fred was on the site before and after 2018.
Nick Daoud disputed that Fred was his "employee" up to the time he ceased performing works in December 2017 and said he reached no agreement with Fred as to the terms for which he would pay him any money. Nevertheless, he accepted that Fred did attend the site to perform casual labour and he said that for such work, he paid him. He said that there was no fixed pattern to when Fred would work: it might be once or twice a week; or perhaps once a fortnight. But Nick said that Fred was not on site every day. The 'payments' he made to Fred were ad hoc: sometimes he paid him in wads of cash: sometimes in the amounts of $500 or $1,000 (or perhaps less); sometimes he paid Fred's bills for living expenses; sometimes he even contributed to school fees for Fred's children.
Nick Daoud was challenged about his evidence of the frequency with which Fred worked on the site and his firm denial of the characterisation of Fred as an employee of his business. Nick accepted that he worked only on a casual basis. In 2016-17, other than the times that he was on site (at Drummoyne or Petersham), Nick said that he did not know what Fred was doing. Nick was referred to a tax return of his (Exhibit O) which did not refer to any payments to Fred; which was consistent with his saying that he only paid Fred in cash. He disputed paying Fred, distinctly, in relation to the latter's organising the contract or for any tender. It was suggested that the ad hoc payments that Nick said he made to Fred were mere 'pocket money' and that, rather, the payments Fred received, directly, from the Owners, represented the true method by which he got paid for his labour services for the benefit of the Builders.
At Nick's direction, following consultation with Frank Ianni, Nick said that Fred prepared tax invoices on his computer (Nick not having a computer himself). Nick said that he supplied information to enable Fred to prepare invoices on the basis of a notebook (which notebook had been left on site after late December 2017). This arrangement appeared to be satisfactory: Nick said that he did not recall any issues about payments of other contractors.
Frank Ianni's recollections about the extent of the two Daouds' involvement were very different. According to him, as the works were being performed from late 2016 and through to the end of 2017, Fred Daoud was more actively involved than Nick. Frank Ianni recalled that Nick was merely observing the works. Fred was observing as well, but also actively involved in joinery, carpentry and roofing. Frank Ianni acknowledged that subcontractors were engaged. To the extent that Frank Ianni observed them interact, he considered that Nick and Fred appeared to get along.
A large bundle of email communications sent to and from Frank Ianni and the email address nominated in the contract was in evidence (Exhibit E) although email was not the only means of communication between them: they both corresponded verbally and by text. These emails were sent to the email address as was contained on the standard version part of the contract (Exhibit A.1). In none of the emails sent by Mr Ianni were they ever addressed specifically to Nick. To the extent that they were expressly addressed to anyone at all, it was only to Fred. Mr Ianni justified limiting his email communications to the Builders in this way because this was the email address identified in the contract. He was not inquisitive about the fact that, notwithstanding that the third and fourth defendants' names were on the building contract (and associated insurances and other documentation), the email address was tgihomes@bigpond.com. Although he acknowledged that TGI Homes was not referred to in the contract, he understood that the email address indicated that it was to be a 'correspondent'. He was indifferent to whether Nick had oversight over the email communications sent to that email address: as far as he was concerned this was a matter between Nick and Fred Daoud. Similarly, he was not inquisitive when he received directions to change the account details into which he transferred payments.
Mr Ianni was referred to two invoices from contractors (Saba Aluminium and John M Excavation), dated 10 November 2017 and 16 November 2017, respectively, which misstated the names of the builders: reference was made to TGI & Co or TGI Homes.
As to his understanding of Fred's status, Mr Ianni said that he did not concern himself with the question whether Fred was an employee of the third and fourth defendants. In her evidence, Ms Piraino characterised Fred as the 'spokesperson' for the builders; who had arranged for the entry into the contract.

[15]

Circumstances in which Nick Daoud ceased performing work from mid-December 2017

Under cross-examination, Mr Ianni was asked about his dealings with Nick up to December 2017. He could not recall having any disagreement, or argument, with Nick. He said he was content with the latter's work. He did not recall Nick raising any issues with him. Mr Ianni did recall, however, expressing his opinion to Nick that he was old and queried why he was working (he did not recall the response). Mr Ianni said he did not know why Nick Daoud did not return to the site after December 2017; other than Fred telling him that Nick was "not well". Nick had never himself indicated to Mr Ianni that he was unwell and Mr Ianni did not directly inquire of Nick of his state of his health even though he had his telephone number. It was put to him, but he denied, that he made no inquiry since he only wanted Fred to do the work.
Ms Piraino similarly could not recall any argument, or disagreement, with Nick Daoud (or Fred Daoud); though did say that she was concerned about the delivery of the works; even within a month or two of their commencement.
Nick Daoud said that from the period in which he was engaged in the works, he was not ill. Further he said he did not tell Frank Ianni or Fred Daoud that he was ill. Up to December 2017, he considered that the works had progressed satisfactorily: Frank Ianni had not raised issues; or complained that the project was over budget or delayed. Nick Daoud said he believed that, up until this point, the Owners were happy with the state of the works.
Nick Daoud gave evidence that in or about the middle of December 2017, he was in his car parked outside the site. He recalled that Frank Ianni approached the car and after Nick wound down his window, Frank said to him (materially) "You go home. I don't want you to come on to the site any more. I don't want you to complete the works any more" and then walked away. Nick Daoud said he became very upset and drove himself home, and conveyed what had happened to his wife. He also said that the next day, he rang Fred and conveyed his account of the conversation with Frank. After doing so, Nick said, Fred did not say a word, and terminated the call.
Nick Daoud said he did not ask Fred to continue the work on the Drummoyne site and Fred did not ask him if he could continue. He said he did not authorise Fred to work since he did not have a contractor's licence. He said that he had not actually seen Fred since the middle of December 2017; although he accepted that he had spoken to him by phone a couple of times and exchanged texts. Nick did not, however, elaborate on the reasons for this falling off in contact with his son.
It was put squarely to Nick Daoud in cross-examination that this conversation with Fred Ianni did not occur. Nick maintained that it did. He elaborated, in cross-examination, that after he left the subject site, he had left chattels belonging to him on the site; which he recalled included his notebook, a step-ladder, jackhammer, and hand (held) hammer. He said he did not take any steps later to retrieve those items. It was put to Nick that the reason he stopped doing work at the subject site was because he was devoting his attention to performing work at the other Drummoyne site, in the circumstances touched upon below. Nick responded that the circumstances of his stopping work at the subject site in Drummoyne had nothing to do with anything he did at the other Drummoyne site.
Nick accepted that he did not take steps to 'terminate' the contract. He said that Frank Ianni never asked him to complete the work, nor wrote to him.
Frank Ianni disputed Nick Daoud's account of the circumstances in which they ended their relationship. Specifically, he denied telling Nick to go home; and that he did not want him to continue to complete the work. He referred to a conversation which he had with Fred Daoud in 2017, in which the latter said that Nick was unwell and was getting older (evidence which was admitted only for proof of the agency issues and not the truth of the content). He denied saying to Nick that he did not want him to come back since he had never asked him to leave in the first place.
Frank Ianni accepted that he had not served any notice of termination of the building contract on the third and fourth defendants and was not aware of them serving any such notice against him (and the second defendant). Nick Daoud's evidence was to the same effect (he did not notify the Owners of his intention to terminate in writing); and he also accepted that he had not sought to assign the contract to Fred.
Mr Ianni did not know whether part of the price for the works remained unpaid after Nick left. He considered that all requests for payment had been honoured. He considered that, at the time, about 60-70% of the works were complete.
Asked why he did not pursue the Owners for the remaining $122,000 which he estimated was owing to him under the building contract, Nick Daoud said that he thought that this amount would only fall due after he had completed the works; and that this did not happen. This, he explained, was why he brought no cross-claim for balance of the contract price in the Owners separate proceeding (in the NCAT) against him.
Nick Daoud said that at the time he left, there was scaffolding on the property. He was challenged on this evidence, but he adhered to it. It was suggested to him, and he agreed, that other alternatives might have been deployed, such as affixing ply board or displaying warning signs in the vicinity. He mentioned that harnesses were available for workers (if they did not themselves bring them on to the site), but he could not recall any 'anchor' points to anywhere in the upstairs bathroom from where Mr Zheng fell. He thought that the stage had not been reached (when he left) when they may have been required. He had no real recollection of any regular practice of safety meetings. He did not tender any written safety rules that he applied whilst he was on site.

[16]

The Builders' sign falls off

Nick Daoud identified a sign (Exhibit 8) which was affixed to the gate enclosing the site. He said he understood that the display of the sign was a Council requirement. As well as identifying the names of the builder, the contract licence number and ABN, the sign also contained mobile phone and landline phone numbers. Nick Daoud explained that this sign was knocked down by a truck driver 6 or 7 days before he finished performing works in mid- December 2017; that he was proposing to restore the sign but did not do so before he finished the works. He was unaware whether anyone else had put it back.
Mr Ianni was asked whether he was aware that a sign erected on the construction works which indicated the Builders' name and licence number was damaged in December 2017. He responded that he was unware of this. He also said he was unaware whether it had been altogether removed in May 2018; although he believed that it must have been removed after a completion certificate was obtained.
Mr Ianni denied taking over the construction works as 'owner builder' from mid-December 2017. He also denied the proposition (premised upon his telling Nick to leave the site and not return) that his decision to do so was based upon his being nervous about the costs of the works in late 2017.
On 18 December 2017, the fifth defendant (Fred Daoud) sent an email [8] to the first defendant (Frank Ianni) asking the latter to pay the former's invoice for delivery of what appeared (from the title to the email) to be a steel alfresco to the Drummoyne property.
On 19 December 2017, Fred Daoud sent another email to Frank Ianni [9] . The email confirmed that plasterers were onsite working, but the main purpose was to request payment of an invoice ahead of delivery to occur on 21 December 2017.
Mr Ianni accepted in cross-examination that other contractors came on to the site - but not Nick. He accepted that there was a need for concreting, work on the windows, bathrooms and plaster boarding.
Ms Piraino accepted that she had not seen Nick Daoud on the site in the months leading up to the plaintiff's accident. She recalled asking him whether he was ok at one point and Nick responding that he was tired.
On 28 December 2017, Fred Daoud sent a further email to Frank Ianni [10] . The subject of the email was a request to transfer payment to a 'new account'. The email attached a tax invoice dated 29 November 2017. It purportedly was on the letterhead of the third and fourth defendants. The Builders say that they did not authorise the invoice. Pertinently, the EFT details were for an account solely in Fred Daoud's name.
Frank Ianni accepted that Fred Daoud had directed him to pay money into a different account. He also accepted that he continued to make certain cash payments to Fred Daoud. Ms Piraino was unaware of Fred's request to make payment into a different account; and did not recall seeing the email of 28 December 2017.
It was put to Ms Piraino, but she disagreed, that from Christmas 2017, Nick Daoud had nothing more to do with the site.
On 29 December 2017, Fred Daoud sent a further email to Frank Ianni [11] , which attached what appeared to be a requested written variation relating to rock excavation for a (water) tank, alfresco and pool, with supporting documentation.

[17]

The Owner's concern about delay

Nick Daoud gave evidence that on or about 15 February 2018, he received a text message originally crafted by Frank Ianni, which he believed had been on-sent to him by Fred (Exhibit 15). The text was admitted over the objection of the plaintiff. The content of the text was consistent with other evidence, shortly to be referred to, regarding the Owner's concerns about delays in the completion of the works. The text message, by its terms, complained of delay and foreshadowed an approach to the NCAT. Reference was made in the text to "Najib" not having been on the job for at least 4 months and the author of the text's impression that Fred Daoud had seemingly been "doing the job on his own".
On 27 February 2018, Fred Daoud sent an email to Frank Ianni [12] , in which he requested a progress payment in order to permit him to perform works, relating to the "doors, jambs, then skirtings" and to pay for his labour. He indicated that he would get skylight framing and bathroom ceiling framing and the underside of boxes done. He resupplied EFT details which had appeared in the invoice that he sent to Frank Ianni on 28 December 2017.
In response, on the same day, and amongst other things, Mr Ianni asked Fred Daoud to provide him with an outline of how Practical Completion would be achieved, based on the outstanding items of work and the funds remaining and attached a spreadsheet [13] . He invited discussion the next morning. When it was suggested that Mr Ianni was corresponding (only) with Fred, Mr Ianni said that his communication was being sent to the third and fourth defendants. He accepted that he had received no direct communication from Nick Daoud himself.
Mr Ianni accepted that, from February 2018, he took no steps himself personally to keep the construction site safe. He indicated that he did not regard that as his responsibility; having also denied that he was a builder owner at that point. He maintained that the third and fourth defendants were the builders and that the fifth defendant was 'directing' traffic.
Ms Piraino gave some evidence of works performed by other contractors prior to the accident. She considered that she and Mr Ianni were responsible for works in relation to the kitchen and shower screen after the tiling that was to be performed. She recalled that the kitchen was completed about the middle of 2018 (after the accident occurred) and that this job was being performed by Mr Ianni's brother. She accepted that several workers were on the site, from February 2018 up to the date of the accident; although could not recall details of who they were.
On 27 March 2018, the Builders' annual insurance policy (with Mecon Insurance) expired. Nick Daoud says that he allowed it to lapse as he was no longer working as a builder and his contract with the Owners at the Drummoyne site had ended.

[21]

Circumstances post-dating the accident

Mr Zheng eventually lodged a claim for workers compensation personally (Exhibit 2). It was unsuccessful.
Nick Daoud tendered financial statements of his partnership with his wife which indicated, relevantly, a significant drop of in takings and gross profit, between the financial years ended 30 June 2017 and 30 June 2018 (Exhibit 17). Statements of Mr Daoud's bank account (into which the Owners deposited payments) showed that his Westpac account into which the Owners had deposited monies was in debit for most of the period after January 2018 (Exhibit Y). However, he did have other accounts, being accounts with the ANZ and NAB (Exhibits V and W, respectively). The balance of monies in the NAB account (in the short extract tendered) showed a significant balance from October 2017, but fairly modest activity on the account up to April 2018. The balance of monies in the ANZ account from October 2017 to May 2018 never rose beyond $4,000.
On 23 August 2018, Mr Ianni sent a text message to both Fred and Nick Daoud (Exhibit H). The text contained the assertion that the Owners had overpaid the contract price and complained about the Owners' loss of rent. He gave evidence that his purpose in sending this was to ascertain who the Owners would be reimbursed by for such overpayment. Asked why he sent the text to both, Mr Ianni expressed his opinion (which was treated as such and not as evidence of the truth of the underlying fact) that although Nick was the builder, it was Fred who he was dealing with him on a day to day basis. Under cross-examination, Mr Ianni accepted that, to the extent that the text message referred to a "discussion", that was only a reference to a discussion that he had had with Fred; and not Nick. He said that Nick did not respond to the text message. When he gave evidence, Nick Daoud denied having had any discussion of any text with Frank, as the text message asserted. Nor did he have any conversation about it. He said he did not respond to it because he considered that he was not involved in the job since December 2017.
Also, in August 2018, Mr Ianni rang Nick Daoud. This, he explained, was for the purpose of ascertaining whether Nick Daoud was insured for the plaintiff's accident. Mr Ianni said that Fred had indicated to him that he had not enjoyed success in finding out about the status of the insurance position from Nick.
Mr Ianni was referred, in cross-examination, to the content of an affidavit of Nick Daoud prepared in an NCAT proceeding which he had commenced against the third, fourth and fifth defendants. In particular, he was referred to Nick Daoud's sworn account of a conversation with Mr Ianni sometime in August, September or October 2018, in which Nick deposed to Mr Ianni referring to the plaintiff's fall and his (Mr Ianni's) need for a copy of Nick's insurance policy.
Mr Ianni accepts that it was likely that he asked Nick about the policy. Mr Ianni was then referred to Nick's response: that he did not have an insurance policy as he (Mr Ianni) had told him (Nick) to go home and had stopped the transfer of money to his account and got the workers to complete the job himself. Mr Ianni denied this part of the account. Mr Ianni said that Nick had told him he had no insurance as he had stopped doing building work anymore.
On 3 September 2018, Fred Daoud sent an email to Frank Ianni (Exhibit 10). Its subject was 'Agreement'. By its terms, Fred Daoud agreed to pay "my share" of monies owed to the third and fourth defendants from the total amount paid over on the contract sum for the building project at Drummoyne. He would pay $16,000 by the first of December. By this, Fred Daoud also agreed that he would "continue" to provide his labour and skills to complete certain enumerated works to the final occupation within the next two weeks.
Mr Ianni was cross-examined on this email. He accepted that, by this point, he was anxious about the completion of the works. He did not accept the characterisation of any 'continuation' as being a reference to works performed by Fred (alone) since the middle of December 2017. Mr Ianni said that Fred had been working from the beginning. He accepts, however, that he did not speak to Nick about the 'agreement' referred to.
Ms Piraino said that Mr Ianni spoke to her about the email. She understood from him that the third and fifth defendants had reached some agreement as to monies payable to her and Mr Ianni.
On 24 September 2018, a certificate of completion was issued (Exhibit G). This was on the letterhead of the third and fourth defendants and was purportedly signed by Nick Daoud, however he said that he did not affix the signature himself; nor authorised the insertion of his signature; nor the use of the letterhead. Nick Daoud said he was unaware that this certificate had been issued. He disputed that his signature was on it. He did not authorise the issue of the certificate. Indeed, he said that he only saw it during the course of his giving evidence at the trial. In cross-examination, after a large bundle of miscellaneous other documents shown to him apparently indicating his signature towards the end of his cross-examination, Nick identified his signature on the document as his, but he promptly corrected himself during re-examination to say that the signature on that document was not one that he had applied.
Mr Ianni said that Fred Daoud supplied him with this certificate, by email at about this time. Asked why he did not ask Nick to arrange for this certificate, Mr Ianni explained that he saw it as Fred's responsibility. Mr Ianni accepted (somewhat grudgingly I thought) that he had no basis for believing that Nick Daoud had such knowledge of the state of the works so as to permit Nick to certify completion.
When she was cross-examined about the certificate of completion, Ms Piraino indicated her understanding that Mr Ianni had spoken to both Nick and Fred Daoud how to progress the works after the contract sum (presumably price) had been exhausted. Even though she thought that Nick was spoken to, she accepted that she did not speak to him herself.
Mr Ianni confirmed that part of the settlement of the plaintiff's claim against him in this proceeding involved his (and his wife's) payment (on a without admissions basis) of the plaintiff's costs, being $80,000 (incl of GST).

[22]

Other works by Nick Daoud

Nick Daoud was referred in cross-examination to his contractor licence which recently expired in August 2021 (Exhibit P) and for which he said, he was awaiting renewal. He said he was also in receipt of Centrelink benefits ($712 per fortnight). Asked why, as a recipient of Centrelink benefits who had considered himself retired from working as a builder he would wish to pay the annual $500 licence fee, Mr Daoud said he kept it as a "hobby".
Nick Daoud said that he had retired after he left works at the subject site in December 2017. It was revealed, however, in cross-examination, that Nick Daoud had allowed an owner (Mohammed Aslam) of other premises in Drummoyne (what I will call the 'other Drummoyne site') to use his contractor licence to obtain home warranty insurance in the second half of 2017. Nick Daoud said he provided assistance, which he estimated was half an hour or an hour a week to help with works on the other premises. This involved a partial demolition of part of the property and the construction of certain additions. He estimated that his business derived the sum of approximately $50,000 from such 'assistance'.
It was pointed out to Nick Daoud, on the basis of his tax return and his evidence of receiving 'progress' payments for what he did at the other Drummoyne site, that he had performed work into the 2019 financial year. Mr Daoud did not recall doing so.
The plaintiff tendered extracts of other bank account statements in Nick Daoud's name, being accounts with the ANZ (Exhibit V) and NAB (Exhibit W) for the periods 29 September 2017 to May 2018 and April 2018 to October 2018. The ANZ statements indicated that Nick Daoud received certain monies and paid certain monies in connection with work at the other Drummoyne site, and also another construction site at Padstow from October 2017 to February 2018. Fairly read, however, the transactions identified in the bank statements were not very substantial in value; in the sense indicating a massive expenditure of time by Nick Daoud on either of these other sites. Further, the plaintiff made no submission as to what, if anything, could be inferred from the content of those bank statements from February 2018 through to the apparent completion of the works at the subject site in September 2018.

[26]

Nick Daoud

Like all of the other witnesses, Nick Daoud gave his evidence remotely, by audio visual link. Compared to the evidence of other witnesses, technical difficulties sometimes prevalent with this form of evidence were particularly pronounced in his case: there were multiple breaks in his giving evidence on account of those difficulties. A further difficulty was that although Nick considered himself to have sufficient understanding of English to give evidence without an interpreter [17] , I considered that his ability to speak and comprehend English was somewhat restricted. It was put to him, and was not vigorously disputed by the witness, that part of the reason for Fred's assistance with third parties like the Owners was that the he was more fluent or familiar with the speaking and reading of the English language. Often his answers did not correspond with the questions asked. I did not infer that this was necessarily the result of deliberate avoidance in answering the questions; but rather was the result of a diminished understanding of precisely what he was being asked.
I formed the impression that he was a practical man. He displayed a reasonably detailed grasp of what works were done (until he ceased performing them), and which remained to be done, when he finished performing works. This was consistent with an active oversight and involvement. But he evinced a rather inept capacity for administration, which helps explain why so much of the 'paperwork' was delegated to his son. I also regarded his apparent practice in allowing others to use his builder's licence as foolish, if not reckless. In doing so, he exposed himself to his son acting in a way which may not have coincided with the interests of his business. Nevertheless, I formed the impression that he tried to tell the truth.
However, I had significant reservations of the reliability of his evidence. This was partly because of a pronounced lack of proficiency and, I also consider, laxity in administration, which naturally impaired his reliability in his recollections of events. I also consider that he was by nature an emotive man and this sometimes led him to overstatement or exaggeration. Thus I found that he overstated his case to say that he was retired after December 2017 when, more accurately, he continued to engage in relatively minor projects which were consistent with partial retirement and reduced working capacity. I am cautious when assessing his evidence. It was difficult to credit him for the broad statement that he had no idea about the connection between TGI Homes and construction works he had undertaken when the evidence suggested prior practice of his son using that corporate vehicle. It is plainly the case that, for reasons that were not elaborated by Nick Daoud, he is estranged towards Fred Daoud, and this had occurred even before the accident which has given rise to the claims against him. It is not surprising if, through ill-will or bitterness, Nick minimized the contributions to his business made by Fred.
I am not able to accept Nick's evidence without reservation, unless it is corroborated or consistent with the objective facts.

[29]

The plaintiff's submissions

The plaintiff submitted that at the date of the accident, the third and fourth defendants were occupiers of the subject site. This was indicated by their contract with the Owners and their practical control of it. That being so, as occupier, the third and fourth defendants owed a non-delegable duty of care, arising because of hazardous activity occurring on the site, thereby engaging the principles referred to in Kondis v State Transport Authority (1984) 154 CLR 672 ("Kondis"); Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520 ("Burnie Port") at 552-4 and Northern Sandblasting Pty Ltd v Harris (1997) 188 CLR 313.
In his closing address, Senior Counsel for the plaintiff acknowledged that his argument about a non-delegable duty of care being owed by the Builders was premised upon the Court finding that the Builders continued to exert practical control over the work site even after Nick ceased performing work in December 2017. Mr Phillips SC also acknowledged that his argument that the Builders continued to enjoy practical control over the site depended upon the Court accepting that, from the end of December 2017, Fred Daoud continued to be, or act as, the representative or agent of the Builders, since he had been put in that position by the Builders before 2017 and nothing that the Builders did after December 2017, in terms of Nick's communications with Frank Ianni, altered that position. The representation made by Nick as to Fred's authority was broad, or at least not confined: he was the administrator for the contract; indeed he had filled in much of its content (and not just the requisite contact details). It was not overtly significant that Nick was the licensed builder since, by statutory provision, he could rely upon qualified builders [18] . It was not necessary for Nick to be on site all the time. Both Nick and Fred were engaging in works and when Nick was away, Fred stood in his place. I do not consider it likely that only Nick held a key to the padlock to the fence enclosing the construction site.
The holding out, that had occurred prior to December 2017, continued after that date. The plaintiff said that the Court should prefer Frank Ianni's evidence over Nick Daoud as to what occurred in December 2017. The former did not instruct the latter to leave. On the Builders' case this was an entirely unexpected development. There was no obvious reason for Frank Ianni to 'sack' Nick. It was submitted that the circumstance that Nick left and did not return to the site was more plausibly explained by his working on other sites (the other site at Drummoyne and Padstow). Fred Daoud was apparently continuing to do what he had done before.
I understood the plaintiff to submit that even if there were, in retrospect, certain matters which might appear suspicious - such as Fred's direction to Frank in early 2018 to channel further payments made for the Builders to continue to perform the works and Nick's apparent application of his signature to the certificate of completion in September 2018 - these were not matters which, at those times, would have put the Owners on inquiry as to any change in the level of Fred's prior authority. On the other hand, what Nick did not do was to take the tangible steps that would have betokened a real change. This was, first and most obviously, taking steps to terminate the contract entered into in September 2016. Secondly, Nick never directly disclosed to Frank any qualifications or withdrawal of Fred's antecedent authority.
That being so, whether or not Fred acted improperly towards Nick in some way, or whether he exceeded any actual authority which Nick had reposed in Fred, did not matter. In accordance with the principles identified in Colonial Mutual Assurance Society Ltd v Producers & Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41, through the continuing works of Fred, the Builders, remained in practical control over the site thereby generating, as occupiers of a site upon which dangerous activities were being performed, a non-delegable duty; or, alternatively, they became vicariously liable for any negligence by Fred from the time that Nick left in December 2017.
By their statement of particulars of negligence in their pleading (paragraph 9), the plaintiff did not distinguish the position of the five defendants. But ultimately, it was clear that the plaintiff submitted that the negligent conduct was that of Fred Daoud and that the Builders were responsible for the consequences of his conduct, whether by reason of a failure to ensure that care was exercised by him, or simply because they were vicariously liable for the negligence of their 'agent'. The plaintiff submitted that the uncontradicted evidence of expert witnesses (who had produced reports for the first and second defendants that the plaintiff relied upon) cited simple precautions that could have been, but were not, taken to prevent the risk of workers falling from the heights. The plaintiff identifies that the risk of harm to a worker falling from a height in the building site was foreseeable and not insignificant and the other considerations in s 5B of the Civil Liability Act 2002 (NSW) (the 'CL Act') inevitably pointed to the conclusion that a breach of duty was proven.
The third and fourth defendants' breach of a non-delegable duty, as occupiers, or vicarious liability for Fred's negligence, caused the plaintiff severe injuries; proven not only by the plaintiff's own account, but also the evidence of Dr Giblin and local doctors in Auburn.

[30]

The Builders' submissions

The Builders disputed the content of the building contract. They generally submitted that the contract was constituted by Exhibit 12 and nothing else. It did not include the 'Reference Document No.2". That particular document reflected a separate, or 'side' arrangement between the Owners and Fred Daoud, in respect to which Fred received a substantial number of cash payments and whose terms were inconsistent, in some respects, with Reference Document 1. The Builders submit that this 'side arrangement' subsisted from the commencement of the works in October 2016 until the works were completed and the nature of the arrangement was reflected in an email between the Owners and fifth defendant dated 3 September 2018 (Exhibit 10). The Builders submitted that Reference Document No. 2 indicated that it was Fred Daoud, not the Builders, with whom the Owners agreed would perform tiling work. The Builders submitted that the Building contract did not include Schedule 4 (the Special Condition clause) and did not include the document which was Exhibit A.3.
Although they say Fred attended, from time to time, on the site, the Builders submitted that Fred was only a 'casual labourer' doing small jobs which Nick asked him to do; for which Nick paid Fred, in an ad hoc fashion, cash or even the payment of some of Fred's bills for living expenses (or children's education). Fred also rendered some administrative assistance in creating documents, such as progress payments. The nature of this assistance was circumscribed. Fred was not their 'employee' or 'agent' in connection with the works themselves. He had no actual authority to do more and the Builders did not hold out to the Owners that he could do more: the Owners knew that Fred was not licensed as a builder and Nick had supplied Frank Ianni with his business card (substantially similar to the version in Exhibit 21) which contained contact details which were different to the details which appeared in the contract (being Fred's actual contact details). There was also a sign on the building site itself which identified the Builders, and Nick Daoud's details (not Fred's details).
The circumstance that Fred engaged in email correspondence (Exhibit E) with Frank Ianni did not assist the plaintiff's case. Most of the written emails in Exhibit E occurred after December 2017. To the extent that the correspondence preceded that period, it dealt almost entirely, in its subject matter with exclusions or variations to the building contract (the latter being those of which Nick was ignorant) or were otherwise consistent with the 'side' arrangement reflected in Reference Document 2. The Owners could not take Fred's use of the Builders' logo on email communications to form any reliance upon any representation that Fred was acting to advance the Builders' interests in those circumstances.
If there was any holding out to the Owners about Fred's authority to represent or advance the Builders' interests before, the representation was effectively withdrawn or revoked from soon after December 2017 and before the plaintiff suffered his accident. This was reflected in a payment made to the separate account of Fred on or about 28 December 2017 (Exhibit E, pp 1002-1003) and also not restoring the sign to the site bearing the Builders' names and contact details.
Counsel for the Builders submitted that the Court should accept Nick Daoud's account of Frank Ianni instructing him to leave, and not return to the site, given in December 2017. Pressed by me as to why Frank Ianni would have done this, Counsel attributed his conduct to Frank Ianni's concern about money and a desire to take over the job and proceed on his own terms.
Counsel for the Builders submitted in her closing address that the building contract was 'abandoned' if not, 'frustrated' even if there was no written termination. Alternatively, it was submitted that Nick himself had terminated the contract on the basis that the Owners had denied him access to the site after December 2017. As indicated earlier, these submissions presaged a late, and unsuccessful, application to amend the Defences in order to plead those facts.
But before the application to amend was brought, Counsel for the Builders also submitted that the contract was terminated by reason of the Owners engaging in a transaction inconsistent with the Building Contract, the Owners repudiated the Building Contract, and that this was repudiation was accepted by Nick Daoud when he left the site in December 2017. Termination on the basis of the Builders' acceptance of a repudiation by the Owners had not been pleaded either. As will become evident later, even if it was fair to the Owners to treat with this non-pleaded argument, I would not have accepted it on its merits as it was far from clear that there was any "inconsistent" engagement which the Owners engaged in.
At any rate, Counsel for the Builders submitted that the building works were directed by the Owners (presumably Frank Ianni) in respect to which Fred Daoud supplied his labour and skills. The employer and employee relationship was between them; and did not involve the third and fourth defendants. Fred supplied the Owners with a bank account in his name to receive his payments from 2018; not the Builders. Other workers came on the site, such as the plasterer, concreter and flooring contractors and, unfortunately for him, the plaintiff. As at the date of the plaintiff's accident, the Builders were not in possession of the site and they had nothing to do with his engagement. It was the Owners, and/or Fred, who were legally responsible for his injuries and losses.
The Builders deny any breach, in terms of any direct liability. The Builders say that when Nick left the site in December 2017, it was in a safe condition: scaffolding had been erected around the whole of the site. Had it been in place in April 2018, the plaintiff would not have suffered the injuries he did even if he did all out of the window void.
If there was, contrary to their submissions, negligence by the Builders, the causal connection between such negligence and the plaintiff's injuries was severed. This was said to be the result, individually or in combination, of several circumstances: the entry into a separate agreement between the Owners and Fred Daoud (September 2016, confirmed in February 2018); when Fred Daoud received his first payment from the Owners (October 2016); when variations were made to the Building Contract in respect to which Fred was paid (September 2017).

[31]

The contract

The Owners came to deal with the Builders through Fred Daoud; whom Frank knew. Fred persuaded Frank Ianni that although he (Fred) was capable of managing the building work, it would be useful for the Owners and himself (he not being licensed) for them to contract with the third and fourth defendants and not Fred.
In about 2016, Nick Daoud authorised Fred to arrange for a contract with the third and fourth defendants for the provision of construction works to the Owners, consistently with the drawings and plans which Nick had seen. Fred completed much of the administrative detail, including providing contact details for the Builders (email address) and bank account details. The former was TGI Homes' email address. Although Nick did not expressly authorise Fred to use the TGI Homes address (or Fred's mobile phone number), I do not accept that, by his doing so, this exceeded Fred's authority.
Fred's authority did not extend to binding Nick to the content of the contract even if he was authorised to insert much of the detail and undertook negotiations as to the terms. I find that Nick signed Exhibits A.1 and Exhibit A.2 ('Reference Document 1' only) but not Exhibit A.3. He initialled, but did not sign, Reference Document 2.
I find that, as Counsel for the plaintiff emphasised, the General Conditions set out the circumstances by which the parties agreed that assignment (cl 16), suspension of works (cl 21) or termination of the contract (cll 28-29) could occur.
From the time when construction works commenced, on or about 13 October 2016, until the middle of December 2017, both Nick and Fred Daoud were involved in the performance of the construction works. Their roles differed. Nick Daoud was more of a supervisor of the hired labour; even if he performed some labour himself. He was, nevertheless, fully immersed in what was going on. Fred also performed minor works requested by Nick himself; and was more involved in the administrative sense, of hiring the labour and liaising with the Owners about requirements; including, in particular, the administration of invoices and payments. Such payments were substantially directed for the benefit of the business of the third and fourth defendants, but Fred received his own cash payments in respect to his performance of the works set out in Reference Document 2.
As to the last matter, and contrary to the Builders' submission, I do not characterise the transaction recorded in Reference Document 2 as constituting any 'side' or separate arrangement between the Owners and Fred. There was a single building contract for a single building project. Reference Document 2 reflected a specific allocation of the works Fred would perform with the balance to be performed by Nick; with or without Fred. Counsel for the Builders submitted that there was partial inconsistency between the specific works which Fred was to complete and the works covered by the Contract, without identifying what that was. It is not apparent to me. I do not accept, therefore, that when undertaking the works in Reference Document 2, Fred was performing works 'outside' the scope of the contract. If there was any want of actual authority conferred upon Fred in relation to Reference Document 2, it was subsequently ratified by Nick.
To reflect Fred's specific contribution, the Owners agreed to pay Fred directly; rather than paying the Builders prior to them forwarding payment to Fred. I do not accept that in a contract valued at over $450,000, in respect to which Fred was agreeing to perform a not insubstantial amount of construction work, to say nothing of his administrative role, it was commonly intended that he would only receive what Senior Counsel for the plaintiff pithily described as 'pocket money' would be fair recompense for his labour; a matter recognised by Nick and Frank. In the events that occurred, and unsurprisingly given the nature of the Builders as being essentially a family business, Fred periodically helped Nick to perform the works allocated to him. I accept that when it came to matters of administration overall, at all times Fred was the point of (at least) written contact.
Thus, the fact that payments were made by the Owners into two separate accounts up to 2018, although curious to a disinterested observer, does not indicate two different contracts. There was no reference in the standard version (Exhibit A.1) to a single account for payment to the Builders. It was left to the parties to negotiate as to by what means the Builders would be paid. In the absence of any indication to the contrary, Nick signified to the Owners that he had left the task to Fred.
The circumstance that, in September 2017, Fred may have issued instructions about variations without Nick's knowledge and consent may arguably indicate an excess of Fred's authority, but is not compelling on the question of side arrangement.
More importantly, the General Conditions applied, alike, to the works that Fred and Nick were actually performing. The contract could not otherwise operate. This meant that if, say, there was any defective work on part of the works earmarked to Fred by Reference Document 2, it would be the Builders, not Fred, as the holder of the licence, who would be liable to the Owners for breach of the statutory warranties under the HB Act (s 18(b)).

[32]

Was Fred an agent of the Builders?

The plaintiff pleaded that Fred Daoud acted as the agent of the Builders; although there were no particulars. It is unnecessary to consider the extent to which, if at all, the Builders actually authorised Fred to work, and whether or not such actual authority was ever revoked. As indicated, the plaintiff's argument proceeded on the basis that the Builders held Fred Daoud out to the Owners as being their agent, and that the holding out continued after December 2017. It is not the case, as Counsel for the Builders submitted, that the plaintiff needed to establish that the Builders had actually authorised Fred to continue works on their behalf after December 2017.
In legal terms, the plaintiff's case is one of Fred Daoud having ostensible authority; being a species of estoppel that prevents the principal from asserting that he is not bound by its earlier conduct. Ostensible authority requires [19] proof of three matters: 1. a representation of authority; 2. reliance (by the third party) upon the said representation; and 3. reasonableness of reliance.
I find that, in various ways, by Nick's conduct, Fred was broadly held out by Nick to the Owners to be one of the builders performing works for the Builders' business, in accordance with the Builders' obligations under the contract. The circumstance that the Owners knew that only Nick was the licensed builder is not determinative; in a context where the HB Act contemplates other builders performing works under the supervision of the licensed contractor. Fred had played an intimate part in negotiating the terms of the building contract and regularly attended the site. Whether he saw Reference Document 2 or not, or appreciated its significance, Nick had at least initialled the document. Nick also permitted a situation whereby written communications for his building business were to be filtered through Fred, without taking safeguards against Fred's capacity, at any time, to misrepresent the situation. This is one of, but not the only means, of representing authority [20] . I find it difficult to disentangle the building works which Fred actually performed, as between those pursuant to Reference Document 2 and those which he was performing to assist Nick to discharge the latter's obligations. Further, it was not always the case that Nick was present on the site. I accept the evidence of Frank Ianni and Ms Piraino, supported by other evidence, that in late 2016, for example, Nick (and perhaps also Fred) were also involved in bringing to an end a building project at Petersham; and I also prefer Frank Ianni's and Ms Piraino's evidence that on occasions Nick did not attend the subject site, which according to Fred, was attributable to his being unwell. There was a representation by Nick to the Owners that Nick was running a family business as Builders and Fred was an integral part of that business.
It is not necessary to find, and I do not find, that a representation was made that Fred was the only builder working for the benefit of the business of the Builders. Because of Nick's own extensive involvement, his provision to the Owners of a business card and a sign that displayed his name, that could not be so. But these manifest indicia that Nick was the principal builder were not inconsistent with Fred also engaging in works to assist Nick to discharge his obligations. As I have noted, I consider that Nick minimized Fred's contribution to the works for which the Builders contracted to provide to the Owners. In this respect, I found the evidence of both of the Owners more persuasive. This tended to indicate a similar level of active involvement, in terms of actual building work, by Nick and Fred. Crucially however, in the ways that I have indicated, it was made apparent to the Owners that when Nick was not doing the building work, but Fred was doing the work, such work was being done in furtherance of the Builders' contractual obligations to the Owners. In short, I find that a representation was made that Fred was authorised by the Builders to act as a builder on their behalf.
I have no difficulty in finding that, prior to December 2017 at least, the Owners relied upon that representation and that it was reasonable for them to do so. The circumstance that the Owners made direct payment to Fred for the part of the works specifically allocated to him does not alter that conclusion.

[33]

Evaluating Nick's evidence that he was sacked as builder

I do not accept that Frank Ianni instructed Nick to leave the site in December 2017. It was common ground that nothing occurred in the lead up to December 2017 which suggested any hint of dissatisfaction by the Owners in Nick's work; such as any prior expression of concern by either or both of the Owners. If the instruction was made, it would have been a shocking event for Nick. But even accepting Nick's evidence at its highest, Frank's instruction was accompanied by no explanation as to why he was 'sacking' the (principal) builder. It was simply peremptory or arbitrary. That would ascribe a level of discourtesy, if not outright indecency, to Frank Ianni which I do not consider is warranted having regard to what was, by all accounts, amicable relations between the Builders and the Owners up to the point. Further, by Nick's own estimate, 80% of the works had been completed. If that was accurate, it is not apparent why the Owners would want to change the nominated builder 'midstream', as it were.
There is, on the other hand, evidence to indicate that Nick was interested in other sites. If Nick's estimate be accurate, there was not a great deal more to be done. There were other development sites that he had a connection with: another Drummoyne site and one at Padstow, from the last quarter of the calendar year 2017 into the first quarter of 2018.
I do not accept, therefore, that Nick was told to leave and told not to return the site as he said he was. If he had been, then I agree with the plaintiff's submission that it might have been expected that, for someone with Nick's long experience with building contracts (and particularly the MBA version, which he had personally selected as the version for this building contract), he would have moved to divest himself of further responsibilities under the contract. Nick must have known that unless and until he exercised the rights which the contract conferred upon him, he remained liable. Inexplicably (if his account is to be accepted), however, he remained inert. Secondly, knowing that works remained, he would have been expected to have said or done something, in conducting himself towards the Owners to confirm who would complete the works. Thirdly, it appears extraordinary that for someone in his position, who was apparently working on at least two other sites, that Nick would leave his chattels at the site without making arrangements for their collection.

[34]

Legal consequences of Nick ceasing to work

In my view, and contrary to the Builders' submission, it was not incumbent upon the plaintiff to establish that the Builders positively renewed, or reaffirmed, Fred Daoud's continued authority after Nick had left in December 2017. On the other hand, the law recognises that prior representations by a principal to a third party of an agent's authority may be withdrawn. A third party may be taken to have notice that conduct by an agent exceeds the agent's authority. A question may arise whether a third party may reasonably rely, or to continue to reasonably rely, upon an antecedent representation of authority, if facts come to the notice of a third party which casts a duty upon it to inquire of the principal. The position was alluded to in Bowstead & Reynolds on Agency [21] at [8.007] & [8.047]-[8.050], in which reference was made to a recent decision of the Privy Council, in East Asia Company v PT Satria Tirtatama Energindo [2019] UKPC 30; [2020] 2 All ER 294 at [75] and [92]-[93]. The learned authors of Bowstead & Reynolds on Agency propounded a test, consistent with the general Australian 'objective' approach to contract law [22] , whereby one looks objectively at all circumstances before asking whether the circumstances suggest that a third party knows that an agent's authority has been withdrawn by the principal.
I consider, in retrospect, that there was some cause for suspicion throughout 2018. If Frank's version was accepted, he did not care about the internal dealings as between Nick and Fred Daoud. Thus, it did not arouse his curiosity, as it might have piqued others' curiosity in his position, when, on or about 28 December 2017, Fred instructed the Owners to direct payments to an account which he controlled which was different to the account in which the Owners had channelled payments to the third and fourth defendants up to December 2017. The evidence indicated that Frank Ianni thought it important to directly liaise with Nick principally only when he became concerned about the availability of insurance after the plaintiff's accident. The Owners had heard nothing from Nick since December 2017, notwithstanding that he was the designated builder. There is nothing to suggest that they inquired about his health or welfare. Soon after, they acceded to a request by Fred to direct future payments, which according to them, they understood to be for the benefit of the Builders, into a different account number in Fred's sole name. The sign that had been affixed to the fence had apparently been removed. In September 2018, they received a certificate of completion bearing Nick's signature which, for someone with Frank Ianni's background, might have taken to have been surprising, given Nick's complete absence from the site since 9 months before.
However, on balance, I do not consider that the circumstances were such that, viewing all of the circumstances objectively, any omission by Frank Ianni to inquire of Nick Daoud into the currency of Fred's authority after December 2017 was such as to no longer render it reasonable for the Owners to rely upon the Builders' prior representation. First, prior to December 2017, there had been no outward signs of disharmony, as between Nick and Fred Daoud. They appeared to be acting cooperatively in a family business. In light of the work that Fred had done, in the absence of contrary indication from Nick, it was reasonable for the Owners to expect that after Nick left, Fred would complete the remaining (20%) works on the job. It was not shown that, in terms of building work itself, Fred was acting altogether differently in 2018 than he had through 2016-17.
No such contrary indication from Nick ever came. Nick did not take the unambiguous steps that would have made it abundantly clear that Fred's authority to assist Nick to discharge his obligations as builder under the contract with the Owner, was withdrawn; by exercising such rights as he had under the contract or even, less formally, by taking the simple step of conveying to Frank Ianni, after December 2017, that he should not interpret any building works thereafter performed by Fred as being work carried out on behalf of the Builders; or otherwise signifying to Frank, in response to Frank's instruction, that he, Nick, would henceforth tell Fred to also stop work and not return to the site. The Owners were entitled to expect that if the Builders had any valid cause for complaint about Frank's instruction to Nick to leave and not return, he would exercise his rights: the content of cl 29, amongst other things, was intended to give the Owners the opportunity to rectify certain enumerated defaults causing difficulty for the Builders; including, most obviously, refusing access to the Builders to the site. Since the question of whether a holding out of an agent's authority has been withdrawn is to be assessed objectively, it is immaterial what Nick understood about his rights; and whether he thought it was necessary to take these steps.
Further, contrary to the Builders' submission, I do not accept that after December 2017, Fred became subject to Frank Ianni's supervision or direction. That was contrary to the Builders' continued right of exclusive possession of the site and the messages I have referred to indicate that, although the Owners were concerned about the pace at which the works were being completed, they were looking to the builders (Nick and Fred) to complete the works. Frank Ianni's email to Fred on 27 February 2018 [23] did not prove directions to Fred as to how he would perform the works to be conducted; but rather were an itemisation of works and a suggested budget in relation to their performance.
I find that the Owners continued to rely upon the representation of Fred's authority after December 2017. That Frank Ianni continued to assume that Fred was working in conjunction with the Builders is illustrated, for example, by his text message to Fred and Nick Daoud on 15 February 2018 (Exhibit 15). Also, his text message of 23 August 2018 (Exhibit H) indicated that he continued to look to Nick as being ultimately responsible under the contract. I do not accept that either of these messages represented a self-conscious attempt by Frank Ianni to make it only appear that he held such beliefs even if it was curious that at no stage did Frank appear to pick up the phone to speak with Nick Daoud. That proposition was not put to Mr Ianni.
In summary, it is the combination of Fred continuing to build works much as he had before December 2017 and Nick's omission to take steps to correct any misunderstanding in the Owners' minds about Fred's authority which lead to the conclusion that, viewing the position objectively, Fred remained the subject of a holding out by Nick that he had authority to continue to perform the building works on the third and fourth defendants' behalf. Fred continued to be held out as performing or completing the works for the benefit of the third and fourth defendant, in discharge of their obligations, even after Nick had left.
In closing written submissions, Counsel for the Builders submitted that the plaintiff could not enforce the version of the building contract that he contends for. But that submission overlooks that in the issues that the Court now has to resolve, it is not necessary for them to do so. The plaintiff does not sue for specific performance. What is of relevance is the contention which the Builders advance that they had no continuing obligations to the Owners under the contract after December 2017. I reject that contention.
A consequence of this analysis of agency is that, in my view, the Builders, through the activities of Fred and the subsistence of the Building Contract, remained in occupation of the Drummoyne site and had practical control over the condition of that site.

[36]

Did the Builders owe a non-delegable general duty of care?

It is well-established that an occupier of property owes a duty of care to an entrant. In this case, the plaintiff was an entrant [24] . I find that the Builders, as occupiers of the Drummoyne site, owed him a duty of care. Is such duty non-delegable?
It is well-established that the notion of non-delegable duty is an exception to the general principle that the law will not impose direct liability upon a person for what another person does, or fails to do. The operation of the exception is such that a person's duty may, in circumstances, extend beyond the person's own careful performance of work, to procuring the careful performance of work which the person delegates to others; and that it is not enough to discharge the duty that work has been delegated to a competent contractor.
It is well-established that one sphere of operation of the doctrine is employment in dangerous activities. That is, the employer's duty to workers of providing a safe system of work is non-delegable. In Kondis Mason J identified that non-delegable duties arise where there is an element present in the relationship between the parties that makes it appropriate to impose on a defendant a duty to ensure that reasonable care and skill is taken for the safety of the persons to whom the duty is owed. In the employment context, Mason J emphasised: the employer's exclusive responsibility for the safety of the appliances, the premises and the system of work to which he subjects the employee; which means that the employee's safety is in the employer's hands. It is also reasonable that the employer should bear liability for the negligence of his or her independent contractors in devising a safe system of work, on the basis that he or she has required the employee (or contractor) to work according to an unsafe system.
The duty of an occupier is usually a duty to exercise ordinary care, capable of fulfilment by delegation to an independent contractor [25] . But in Burnie Port, a majority of the High Court indicated (at 550) that it was "arguable" that the relationship between occupier and invitee might fall into a category of case, or relationship, whereby the duty of care is non-delegable. The majority (at 551-552) generally identified as the rationale for affixing a non-delegable duty of care, in the context of its determination that the principle of Rylands v Fletcher [26] was properly subsumed within the tort of negligence, that the person (upon whom it is suggested the non-delegable duty is imposed): "..assume(d) a particular responsibility for his or its safety, in circumstances where the person affected might reasonably expect that due care will be exercised. …. One party to that relationship is a person who is in control of the premises and who has taken advantage of that control to … undertake thereon a dangerous activity or to allow another person to do one of those things. The other party to that relationship is a person, outside the premises and without control over what occurs therein, whose person or property is thereby exposed to a foreseeable risk of danger. In such a case, the person outside the premises is obviously in a position of special vulnerability and dependence. He or she is specifically vulnerable to danger if reasonable precautions are not taken in relation to what is done on the premises. He or she is specially dependent upon the person in control of the premises to ensure that such reasonable precautions are in fact taken. Commonly, he or she will have neither the right nor the opportunity to exercise control over, or even have foreknowledge of, what is done or allowed by the other party within the premises. Conversely, the person who .. undertakes (or allows another to undertake) the dangerous activity on premises which he or she controls is 'so placed in relation to [the other] person or his property as to assume a particular responsibility for his or its safety … …. ….. the central element of control .. generates, in other categories of case, a special 'personal' or 'non-delegable' duty of care under the ordinary law of negligence .. that common element gives rise to such a duty of care in the first-mentioned category of case. There are considerations of fairness which support that conclusion, namely, that it is the person in control who has authorized or allowed the situation of foreseeable potential danger to be imposed on the other person by authorizing or allowing the dangerous use of the premises and who is likely to be in a position to insist upon the exercise of reasonable care. It is also supported by considerations of utility: 'the practical advantage of being conveniently workable, of supplying a spur to effective care in the choice of contractors, and in pointing the victim to a defendant who is easily discoverable and probably financially responsible .."
The emphasised passage indicates that the duty imposed upon the occupier is based upon control, not ownership, as corollary of the power to admit or exclude. Building contractors may share occupation of the site with the owner [27] . In this case, however, the contract with the Owners made the Builders' occupation of the site exclusive.
Burnie Port was considered by the High Court in Northern Sandblasting Pty Ltd v Harris (1997) 188 CLR 313, where the Court considered the duty of a landlord to a tenant's child who was electrocuted after the landlord had engaged an electrical contractor. A bare majority determined that the landlord was liable for breach of its duty of care. What appeared to be of especial factual significance in the case was that the defect existed prior to the tenant taking possession, even if could only have been discovered by a contractor. As Brennan CJ said (at 340) the landlord's duty did not extend to defects in the premises discoverable only after the landlord had parted with possession. The same point was effectively found by Gaudron J (at 359). It was also implicit in the judgment of McHugh J that the tenants and their children entered into possession after the purported repair of the defect (at 369).
In Complete Scaffold Services Pty Ltd v Adelaide Brighton Cement Ltd [2001] SASC 199, Doyle CJ observed (at [42]) that the High Court had not identified a single criterion by which a court could determine when a non-delegable duty would be imposed, although suggested, in the light of authorities, that generally a task or undertaking was required to be performed that carried with it an inherent and high risk of harm to others; with those others being especially vulnerable.
More recently, in Woodland v Essex County Council [2014] AC 537, Lord Sumption, delivering the leading judgment (in which all the other Justices agreed), attempted to rationalise the considerations, identifying two broad categories of circumstance in which a non-delegable duty of care has arisen.
The first is where a defendant employs an independent contractor to perform some function which is either inherently hazardous or is liable to become so in the course of the work. His Lordship considered that the justification for imposition of the duty rested in a special public policy for operations involving exceptional danger to the public ([6]).
The second was the genus of cases concerning nuisance ([8]-[10]).
The third was the balance of cases is where a number of circumstances arise. His Lordship said (at [23]) that: 1. a claimant is especially vulnerable or dependent upon the protection of the defendant against the risk of injury; 2. there is an antecedent relationship between the claimant and the defendant which: (a) places the claimant in the defendant's custody, charge or care; and (b) makes it possible to impute to the defendant the assumption of a duty to protect the claimant from harm, and not just a duty to refrain from conduct which will foreseeably damage the claimant; 3. the claimant has no control whether the defendant performs obligations personally or through third parties; 4. the defendant has delegated to a third party some function which is an integral part of the positive duty which he or she has assumed towards the claimant; and the third party is exercising, for the purposes of the delegation, the defendant's custody or care of the claimant (and the element of control that goes with it); 5. the third party has been negligent, not in any collateral respect, but in the performance of the very function assumed by the defendant and delegated by the defendant to him or her.
Woodland has to some extent, been considered in Australian Courts. It was referred to in Pioneer Mortgage Services Pty Ltd v Columbus Capital Pty Ltd [2016] FCAFC 78 at [64]. It was also cited with approval by Ball J, albeit at an interlocutory level, in The Owners - Strata Plan No. 51077 v Meriton Apartments Pty Ltd [2014] NSWSC 129 at [15].
I do not read anything in what his Lordship said as being fundamentally inconsistent with Australian authority, binding on this Court, on the subject. Neither Counsel in this case suggested that the principles distilled by his Lordship should not be followed. That distillation of principles plainly took into account, even if they did not amount to an unqualified endorsement of the reasoning in, the Australian authorities (see [23]). I would have thought that the circumstances of this case would fall within at least the first category of circumstance identified by Lord Sumption in Woodland.
But even if they did not, I accept the plaintiff's submissions that the circumstances fall within the principles of Kondis and Burnie Port. There were both the aspects of (a) the Builders' practical control over the Drummoyne, through the continuing works performed by Fred Daoud who continued to be held out as working for the benefit of the Builders, over the condition of the site and there was (b) the special dependence or vulnerability of the plaintiff who entered upon the site for the limited purpose of tiling.
As to the former, because Fred continued to perform works in discharge of the Builders' obligations, the Builders continued to remain in practical control. This is not the position analogous to Northern Sandblasting, where the landlord's practical control over the site ceased after the tenant entered into possession. The Builders' practical control did not cease after Nick stopped work in December 2017.
As to the latter a construction site presents the classic case of physical danger to entrants. That was reflected here with a large void in the upstairs section of the building. As I said in my analysis of Fred's authority, Nick Daoud allowed the position to occur that Fred continued to perform works which were, of their nature, potentially dangerous without taking any steps himself to indicate to the Owners that, so far as he was concerned, he would have no further oversight of the works himself. In effect, he held out to the Owners, and contractors who like the plaintiff entered onto the site, that Fred was his delegate.
In relation to some of the policy considerations supporting the imposition of a non-delegable duty identified in Burnie Port, acceptance of a duty which was non-delegable would act as a spur to persons like Nick in the choice of their delegate. It is true, and unfortunate for the Builders, that the policy consideration that vulnerable persons could look to the Builders as being 'financially responsible' (as the majority emphasised in Burnie Port as a policy consideration) were not present here: Nick chose not to renew his insurance. That was financially irresponsible in circumstances where he had left the site when the works were not completed and must have known that unless he took steps to effectively notify the Owners that they could not look to Fred to complete the works, any accident that occurred on Fred's watch might result in the situation which has since materialised, that an injured worker would have recourse only against an uninsured builder. Putting the matter bluntly, Nick washed his hands of his responsibility without indicating to the Owners that this was his intention.
I find that the Builders' duty of care to the plaintiff was non-delegable.
If I am wrong, it may be useful to consider whether an alternative route to the same result may be reached through application of the doctrine of vicarious liability.

[37]

Vicarious liability

In Sweeney v Boylan Nominees Pty Ltd (2006) 226 CLR 161 ("Sweeney"), the High Court (Kirby J dissenting) noted the continuing doctrinal uncertainty underlying vicarious liability. But what was at least clear was that the distinction that had emerged in the authorities between employees (for whose tortious conduct an employer was generally vicariously liable) and independent contractors (for whose conduct persons engaging the contractor was generally not vicariously liable) was too entrenched to be uprooted.
Whether conduct falls within the scope of a person's employment (or agency) has been said to require evaluation of roles which are assigned by the employer and the nature of the person's responsibilities [28] .
Whether the third and fourth defendants are vicariously liable for injuries inflicted upon Mr Zheng by reason of conduct of a putative employee (or agent or representative) is to be answered as at the date of the accident [29] (April 2018); not the date when the third and fourth defendants entered into their contract with the Owners (September 2016).
As indicated earlier, the plaintiff ultimately did not submit that from December 2017, Fred Daoud could be said to be an employee of the third and fourth defendants. In this, I think, they were right to do so. There was nothing to suggest that Fred Daoud came under the latter's control. They based their claim to the Builders being vicariously liable for his conduct on account of his being an agent (or representative) of the Builders. He held this status before and after Nick Daoud left work in December 2017.
Conclusions about whether a person is vicarious liability for another's tortious conduct do not arise simply from ascribing a category, or label, to a person's legal relationship to another. Nor, as the joint judgment in Sweeney emphasised (at [13]), does it assist to proof of the vicarious liability for an agent's conduct to reason from the bare fact that the agent's conduct may be said to have intended to be benefit the person said to have been vicariously liable for the former. Nor does it assist analysis to say that the person for whom another is said to be vicariously liable "represents" the latter ([26]).
The joint judgment in Sweeney analysed conclusions about responsibility for an agent's conduct identified by Dixon J in Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co-Operative Assurance Co of Australia (1931) 46 CLR 41, before explaining that, in that case, the party who had appointed the agent (albeit as an independent contractor) was liable for the tortious conduct - slanders uttered - occurring during the course of the agency, in soliciting proposals, and stood within the bounds of the explanations provided by Pollock for the vicarious liability of a master for the tortious acts of the servant: "because of the closeness of the connection between the principal's business and the conduct of the independent contractor for which it sought to make the principal liable" [24].
Earlier, in Scott v Davis (2000) 204 CLR 333, in the leading judgment, Gummow J alluded (at [253]) to more modern theories, or policies, underlying vicarious liability as being that the person who engages others to advance that person's economic interests should be liable for losses incurred by third parties in the course of the enterprise, and a suitable means for passing on losses through liability insurance.
As indicated in my earlier analysis, I have accepted that Fred Daoud continued to build on the Drummoyne site after 2017 as agent for the Builders. To adopt the language of Pollock which was cited by the majority in Sweeney, for his own convenience, Nick maintained a state of affairs - the Builders' continuing obligations to the Owners under the contract - which was only capable of performance through the labour of Fred, and the nature of those obligations was such as to potentially work "mischief" to contractors like the plaintiff. That supplies the closeness of connection between the Builders' business and Fred's conduct which justifies the imposition of vicarious liability.
If I am wrong in finding a non-delegable duty of care was owed by the Builders to the plaintiff, I would have found the Builders vicariously liable for negligent conduct by Fred as at 12 April 2018.

[44]

Scope of liability: whether any supervening events

The more contentious question is whether the scope of liability element is also satisfied. In this context, it is accepted that arguments about supervening causes or events, as developed under the general law, remains relevant in the normative inquiry which the Court engages in under this requirement (Monaghan Surveyors Pty Ltd v Stratford Glen-Avon Pty Ltd [2012] NSWCA 94 per Basten JA at [70]).
Underlying the notion of supervening cause analysis is that it is the voluntary intervention of a subsequent actor which is the true cause of a plaintiff's loss, even though the defendant's conduct was an antecedent condition of the loss occurring. The supervening conduct must be both deliberate and voluntary: March v Stramare (E & M H) Pty Ltd (1990) 171 CLR 506 per Mason CJ at 517.
Counsel for the Builders submitted that if, contrary to their primary submission, there had been any negligence by the Builders when their contract with the Owners was abandoned (or terminated) in December 2017, it was severed by supervening events. This was the involvement of Fred Daoud and other sub-contractors to complete the works left over from December 2017; which works were done without the Builders' awareness or supervision.
In my view, to the extent that the third and fourth defendants cite conduct of the fifth defendant, this is one of those instances [30] where the 'scope of liability' element is coextensive with the findings that I have made about the third and fourth defendant's legal responsibility for Fred's conduct. If, as I have found, they were legally responsible for his acts or omissions, after Fred ceased working in December 2017, it makes no sense to say that any causal connection between their breach of duty was severed by his conduct in the premises stipulated.
This conclusion makes it unnecessary to address the fine distinction submitted by Counsel for the Builders, by reference to a decision she relied upon [31] , between a party's omission to act and a contractor's grossly negligent conduct.
Beyond the suggestion of a 'side agreement' with the fifth defendant, there was no articulation as to how anything done by the Owners severed a causal connection [32] . However, once it is found, as I have determined, that the Builders remained responsible for Fred's conduct after December 2017, it is immaterial whether Fred went beyond the scope of the authority conferred upon him to be dealing with the Owners for his benefit and not for the benefit of the Builders.
The scope of the liability element is also satisfied. Causation is made out.

[45]

Mr Zheng's evidence

After his fall, Mr Zheng was conveyed by ambulance to hospital where he remained for a week, where he was treated for his fractured tailbone, back, ribs, damaged spleen and brain injury.
Among the hospital records was a final report of a CT of Mr Zheng's brain indicated that although he had initially sustained a subarachnoid haemorrhage, that was no longer evident; and also a final report of a CT Trauma report; which noted small areas of splenic laceration with a small amount of haemoperitoneum in the upper abdomen, there was no evidence of actual bleeding; an undisplaced fracture in the left (10th) rib, minimally displaced transverse process fractures of the lumber spine and spinous process fracture of the L5 and undisplaced right ilium and left inferior pubic ramus fractures. Upon his discharge from hospital, he had been prescribed paracetamol.
Upon his discharge, he was bedridden for about four weeks, during which period he received consultations from a GP and underwent physiotherapy.
After leaving hospital, Mr Zheng consulted a number of general practitioners in a practice at Auburn.
Under cross-examination, Mr Zheng accepted that he had not seen a general practitioner since 2019 and had not received physiotherapy since shortly after he was discharged from Royal Prince Alfred Hospital after the accident. He recalled having only two visits to a physiotherapist.
It was suggested to Mr Zheng that when he saw Dr Dalton, a consultant physician who had been engaged by the first and second defendants in July 2020, he had made certain statements contrary to what he informed the Court. These statements to Dr Dalton were proven in a redacted version of the report of that practitioner (Exhibit 22) which I admitted, subject to a limitation that it was to be used in only in relation to the plaintiff's credibility. This included his stating to the Court that he was unconscious after the fall, after having earlier told Mr Dalton that he was not unconscious. According to Dr Dalton, Mr Zheng had told him about his inability to seek out and persuade his employer to lodge a claim on his behalf. Mr Zheng suggested that the employer was displeased by that idea. It was also suggested that Dr Dalton had recommended to Mr Zheng that he receive on-going physiotherapy treatment and that he receive exercise in physiology. Mr Zheng could not recall receiving such recommendations. He said he had not read Dr Dalton's report, but had been notified of its contents.
In re-examination, Mr Zheng said he did not know what exercise in physiology was and he evinced a very rudimentary understanding of the services of a physiotherapist; essentially assimilating it to the services of a masseur. He said that since leaving hospital, he had not been able afford massages. He was not, however asked about his willingness to undertake physiotherapy or exercise in physiology on the assumption that he had the financial means to do so.
Mr Zheng said that he still suffers from lower back pain; particularly when doing any heavy lifting, bending over or "on rainy days". He did not indicate any pronounced difficulty with reading in the sense of headaches or loss of concentration; although he did identify a difficulty with his neck, when tilting his neck to read.

[55]

The evidence

From 1990, Mr Zheng worked in various construction jobs whilst in China up to 1999. He arrived in Australia in 2017, on a protection visa. He is married, but apparently separated from his wife, who lives in China with their children. Mr Zheng supports his wife and children by transferring money to them overseas.
In his evidence, the plaintiff said that prior to working at the site at Drummoyne, he had been working 6 days a week, for two weeks, getting paid cash $300 per day. As indicated, however, that evidence was limited, in its terms, to the two weeks before the accident.
Certain certificates of incapacity in 2018 were tendered (Exhibit M), but neither party referred to their contents.
In July 2018, a few months after the accident, the plaintiff took a job as a meat packer, but this only lasted for 3 or 4 days. He felt pain in his lower back, neck, inner thigh and pelvis, from standing and lifting heavy items.
Mr Zheng said that he worked as a cleaner (or perhaps more accurately gardener) over a non-consecutive period of 10 days, working 8 hours a day, receiving $200 a day. He stopped this work since after finishing his shift he felt pain.
Since July 2019, Mr Zheng has worked for a builder Mr Danny Hu, who, he says, has engaged him occasionally to do tiling work. He says he has been doing small jobs. Mr Zheng says that the number of days he worked each week depended not only upon the availability of work, but also how he feels; but on average, is about 2 or 3 days a week, for about 8 hours. He said that when he does this work, he receives assistance from another worker. He also said that Mr Hu has indicated to him that he will only allocate jobs for him on the basis of his perception of Mr Zheng's physical capacity to do them.
It was put to Mr Zheng, but Mr Zheng denied, that he could, if he chose, perform other work on the occasions when he was not engaged by Mr Hu. He indicated that he had inquired into other sources of income. It was also put to Mr Zheng, but he denied, that his injuries were not restricting his working capacity.
He said that he has not been in receipt of Centrelink benefits.
Mr Zheng said that he initially was paid $300 per day from this work, but that rate of pay has increased. Since June this year, he has been paid $350 each day.
Tax returns adduced in evidence (Exhibit O) indicate the plaintiff's taxable income being as follows: FYE 30 June 2018 $61,471 FYE 30 June 2019 $20,968 FYE 30 June 2020 $14,107 FYE 30 June 2021 $23,685
An inherent difficulty with this evidence is that the starting (financial) year for the tax return was the year in which the accident occurred (and towards the end of that year). The plaintiff gave scant evidence of how often any labour hire firm that employed him for the subject job utilised his services in this country as a tiler and the Court has no other reliable evidence of the frequency of work, for any sustained period, that he enjoyed in that capacity prior to the accident. For all the Court knows, the plaintiff enjoyed a good financial year prior to the accident relative to the past. The Court's impression is that prior to the accident, he had no fixed employment which could support an on-going incapacity premised upon continuous or permanent full time employment, getting $1200 a week.
The plaintiff said that he transferred monies from his account to support his family overseas. He did not adduce bank statements which might have indicated not only how much he had transferred overseas, but also how much he had received from earnings.
It is, however, clear from the tax returns, that there has been a diminution in his earnings and I accept that it has been proved, in combination with acceptance of the plaintiff's evidence (it being to his credit that he has returned to work with his incapacity) that he has suffered a diminution.
In the closing submissions of Junior Counsel for the plaintiff, it was accepted that the plaintiff was partially fit for work and his claim for damages in relation to past and future earning capacity was conservative. His decline in income was established, amongst other things, by his tax returns.
Counsel for the Builders did not articulate how the Builders arrived at their suggested figures for past economic loss, or (for that matter) future loss of earning capacity.
There were no Income Statements or Group Certificates in evidence and in the last two financial years, there was no identification in the plaintiff's tax returns (Exhibit O) of any employer (such as Mr Hu). I agree with the submission of the plaintiff's counsel that it has not been demonstrated that any employer of the plaintiff has incurred an obligation to pay superannuation.
Doing the best I can, noting the difficulties I have alluded to, I make an allowance for this head in the sum of $100,000.

[61]

Endnotes

The fourth defendant was not actively involved in building work, but was joined on the basis of being one of the business owners through which the builder performed work. Henceforth, unless indicated otherwise, when reference is made to 'the Builders' in relation to conduct the reference is to the conduct of Nick Daoud
James Hardie & Co v Seltsam Pty Ltd (1998) 196 CLR 53
By clause 16 of the General Conditions to the contract an assignment could only occur with the written consent of all parties (not to be unreasonably withheld).
DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423 at 434; Ryder v Frohlich [2004] NSWCA 472 per McColl JA (Hodgson JA and Ipp JA agreeing) at [135] - [137]
In the sense of substitution of the fifth defendant for the third and fourth defendants whilst otherwise preserving the content of the obligations and rights: Olsson v Dyson (1969) 120 CLR 365 per Windeyer J at 388-391; J D Heydon, Heydon on Contract: The General Part (LexisNexis, 2019) ([13.480], [22.170]
Zheng v Ianni & Ors (No.2) [2021] NSWDC 511.
Exhibit Y, p 920 of volume 2 of Court Book
Exhibit E, p 999 of Vol 3 of the Court Book
Exhibit E, p 1000 of Vol 3 of the Court Book
Exhibit E, pp 1002-1003 of volume 3 of the Court Book
Exhibit E, p 1004 of vol 3 of the Court Book
Exhibit E, p 1017 of vol 3 of the Court Book
Exhibit E, pp 1102-1103 of vol 3 of the Court Book
Exhibit E, p 1027 of Vol 3 of the Court Book
Exhibit E, p 1028 of Vol 3 of the Court Book
As to the problematic nature of the weight to be accorded to answers to leading questions being raised by an advocate of a client, see Kirk v Industrial Relations Commission of NSW (2010) 239 CLR 531 per Heydon J at [117]
Nick Daoud said he was of Lebanese extraction
Reference was made to the Home Building Act 1989 (NSW) ('HB Act'), ss 12-13
Freeman & Lockyer v Buckhurst Park Properties (Magnal) Ltd [1964] 2 QB 480 per Diplock LJ at 502; applied in Crabtree-Vickers Pty Ltd v Australian Direct Mail Advertising & Addressing Co Pty Ltd (1975) 133 CLR 72; Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 ("Pacific Carriers") at [36]
Pacific Carriers at [38]
(22nd ed, electronic version, Sweet & Maxwell)
Price v Spoor [2021] HCA 20; (2021) 95 ALJR 607 at [27]; Taylor v Johnson (1983) 151 CLR 422 at 428-29 and also Sir Anthony Mason AC KBE, 'Themes and tensions underlying the law of contract' in G Lindell, The Mason Papers (The Federation Press, 2007) at 299-303
Exhibit E, pp 1102-1103
Australian Safeway Stores v Zaluzna (1987) 162 CLR 479
Fleming's The Law of Torts (10th ed, electronic version, Thomson Reuters (Professional) Australia Pty Ltd) [22.130] ("Fleming")
(1866) LR 1 Ex 265
Fleming [22.20]
Prince Alfred College Inc v ADC (2016) 258 CLR 134 per French CJ, Kiefel, Bell, Keane and Nettle JJ at [80], noting the observation was made in the context of assessing vicarious liability of an employer for intentional criminal conduct by an employee
Kondis v State Transport Authority (1984) 154 CLR 672 per Mason J at 677
Wallace v Kam (2013) 250 CLR 375 at [26]
Simpson Design Associates Pty Ltd v Inspector Ching [2011] NSWIRComm 7
March v E & MH Stramare (1991) 171 CLR 506
The third and fourth defendants' tender of an expert medical report prepared by the first and second defendants was rejected at trial: Zheng v Ianni & Ors [2021] NSWDC 492. 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: 30 September 2021

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