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HIPPYDAYZE PTY LTD and MENER GROUP PTY LTD [2019] WASAT 92 (27 November 2019)

Last Updated: 28 November 2019

JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL

ACT :  BUILDING SERVICES (COMPLAINT RESOLUTION AND ADMINISTRATION) ACT 2011  (WA)

CITATION : HIPPYDAYZE PTY LTD and MENER GROUP PTY LTD [2019] WASAT 92

MEMBER : MS C WALLACE, SENIOR MEMBER

MR D MOROLLA, SESSIONAL MEMBER

HEARD : 10 & 11 SEPTEMBER 2019

DELIVERED : 15 OCTOBER 2019

FILE NO/S : CC 1436 of 2017

CC 1438 of 2017

CC 1439 of 2017

CC 754 of 2019

CC 755 of 2019

CC 756 of 2019

BETWEEN : HIPPYDAYZE PTY LTD

Applicant

AND

MENER GROUP PTY LTD

Respondent

 Building Services (Complaint Resolution and Administration) Act 2011  (WA) - Home Building Contracts Act 1991 (WA) - Misleading or deceptive conduct - Delay in achieving practical completion - Damages for breach of contract - Principle of mitigation of loss - Building service complaints - Exercise of discretion in making a building remedy order - Claim for compensation in building service complaints - Whether applicants are required to mitigation loss in non­contractual complaints - Failure to mitigate loss due to impecuniosity

Legislation:

 Building Services (Complaint Resolution and Administration) Act 2011  (WA),  s 5(1) ,  s 5(2) ,  s 11(1)(d) ,  s 36(1) ,  s 36(1)(b) ,  s 36(1)(c) ,  s 38(1) ,  s 38(1)(a) , s 41(2),  s 41(2)(d)(i) ,  s 43(1)(a) ,  s 49(1) ,  s 58(2) 
Home Building Contracts Act 1991 (WA), s 15A, s 17, s 17(1)(a)(ii), Pt 2
State Administrative Tribunal Act 2004 (WA), s 46(3), s 49

Result:

Partly successful

Category: B

Representation:

Counsel:

Solicitors:

Case(s) referred to in decision(s):

Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336

Burns v MAN Automotive (Aust) Pty Ltd [1986] HCA 81; (1986) 161 CLR 653

Butcher v Lachlan Elder Realty Pty Ltd [2004] HCA 60; (2004) 218 CLR 592

Clark v Macourt (2013) 253 CLR 1; [2013] HCA 56

Commonwealth v Amann Aviation Pty Ltd [1991] HCA 54; (1991) 174 CLR 64

Gemmill Homes Pty Ltd and Sanders [2018] WASC 179

Google Inc v ACCC (2013) 249 CLR 435

Hadley v Baxendale [1854] EngR 296; (1854) 9 Exch 341

Mener Group Pty Ltd and Hippydayze Pty Ltd [2019] WASAT 37

Mener Group Pty Ltd and Hippydayze Pty Ltd [2019] WASAT 58

Mener Group Pty Ltd and Hippydayze Pty Ltd [2019] WASAT 91

Nelson v Mardesic (1998) 22 SR (WA) 42

Robinson v Harman [1848] EngR 135; (1848) 1 Exch 850

Trengove and Celebration Nominees Pty Ltd [2012] WASAT 65

Vouzas v Bleake House Ptd Ltd [2013] VSC 534

REASONS FOR DECISION OF THE TRIBUNAL:

Introduction

1. The Tribunal had before it six related applications brought by Hippydayze Pty Ltd (the applicant) against Mener Group Pty Ltd (the respondent) which were lodged with the Building Commissioner and then referred to the Tribunal pursuant to  s 11(1)(d)  of the  Building Services (Complaint Resolution and Administration) Act 2011  (WA) (the BSCRA Act).
2. The complaints were in respect of three home building work contracts (HBWCs) entered into between the applicant and respondent to construct three units on a parcel of land in the suburb of Gosnells in the State of Western Australia. The complaints alleged, pursuant to s 5(1) of the BSCRA Act, that the respondent had performed a regulated building service which had not been carried out in a proper and proficient manner or which was faulty or unsatisfactory. The applicant also raised complaints pursuant to s 5(2) of the BSCRA Act and s 17 of the Home Building Contracts Act 1991 (WA) (HBC Act) alleging various breaches of the HBWCs entitling the applicant to compensation, as well as an allegation that the respondent had engaged in conduct that was misleading or deceptive pursuant to s 15A of the HBC Act.
3. The most substantive complaint raised in the proceedings was a claim alleging breach of the HBWCs by the respondent failing to bring the works to practical completion within the contractual time period specified. Whilst the respondent admitted breach and conceded significant delay in reaching practical completion, it disputed the compensation claimed by the applicant, a claim being in excess of $100,000.
4. The respondent also lodged its own applications with the Building Commissioner alleging breach of the HBWCs due to the applicant's failure to pay the final progress payments issued by the respondent. Those applications were initially determined by the Tribunal differently constituted on 28 May 2019 (the Original Tribunal); Mener Group Pty Ltd and Hippydayze Pty Ltd [2019] WASAT 37. Subsequently the respondent filed an application pursuant to s 58(2) of the BSCRA Act seeking leave to review that decision (proceeding CC 943 of 2019). Leave to review was granted; Mener Group Pty Ltd and Hippydayze Pty Ltd [2019] WASAT 58. The hearing de novo was heard concurrently with these proceedings and reasons published; Mener Group Pty Ltd and Hippydayze Pty Ltd [2019] WASAT 91.
5. The history of the various related proceedings has some level of complexity and it is useful to refer to that history in passing, before considering the parties' respective positions in relation to the complaints to be determined by this Tribunal.

Procedural history

6. In December 2016 the applicant lodged its initial three complaints with the Building Commissioner. The three complaints were referred by the Building Commissioner to the Tribunal in July 2017 and became proceedings CC 1436 (in respect of unit B), CC1438 (in respect of unit C) and CC1439 of 2017 (in respect of unit A).
7. As already mentioned earlier, the complaints in each proceeding comprised a mixture of building service complaints and contractual complaints.
8. Proceeding CC 1436 of 2017 comprised 11 complaint items; proceeding CC 1438 of 2017 comprised 9 complaint items and proceeding CC 1439 of 2017 comprised 16 complaint items. It is not necessary for the purpose of this decision to list each individual complaint item.
9. The proceedings were mediated unsuccessfully a number of times by the Original Tribunal.
10. As mentioned, each proceeding included a contractual complaint alleging delay in which practical completion had been achieved by the respondent and seeking an order for compensation. Each proceeding also raised an allegation of misleading or deceptive conduct engaged in by the respondent by seeking an advancement of monies from the applicant prior to the relevant HBWCs being executed.
11. In February 2018 the applicant lodged three further complaints with the Building Commissioner in respect of the three units. The three new lodgements comprised a total of 95 complaint items, most of which were building service complaints made pursuant to s 5(1) of the BSCRA Act together with a small number of claims made pursuant to s 5(2) of the BSCRA Act and s 17 of the HBC Act alleging various breaches of the HBWCs.
12. In March 2018 the Building Commissioner referred the three new complaints to the Tribunal pursuant to s 11(1)(d) of the BSCRA Act and they became proceedings CC 708 (in respect of unit C), CC 709 (in respect of unit A) and CC 710 of 2018 (in respect of unit B).
13. The majority of the complaint items in proceedings CC 708, CC 709 and CC 710 of 2018 were settled by the parties following mediation by the Original Tribunal with final orders made on 22 August 2018. However, three building service complaints in proceeding CC 708 of 2018 and one building service complaint in proceeding CC 710 of 2018 were inadvertently omitted by the parties through the mediation process and were ultimately withdrawn by the applicant on 1 July 2019.
14. Whilst it is not strictly relevant to the current determination, it ought to be noted in the context of the procedural history of these proceedings that there was some level of confusion whilst the proceedings were being case managed by the Original Tribunal in respect of two matters: the relevant proceeding in which particular complaint items had been made; and as complaints were compromised by the parties, which complaint items remained outstanding.
15. This confusion, which appeared to be shared by the parties and the Original Tribunal, had the greatest impact in respect of proceedings CC 1436, CC 1438 and CC 1439 of 2017. In this regard the Original Tribunal made the following order on 24 October 2018 in proceedings CC 708, CC 709 and CC 710 of 2018:
    1. It is noted that the only relevant aspects of matters CC 708-18, 709-18, and 710-18 that remain to be determined relate to the claims for damages/compensation by the owner.
16. The complaint referred to in order 1 above was in fact the claim made by the applicant in each of CC 1436, CC 1438 and CC 1439 of 2017 alleging breach of the HBWCs by the respondent in respect of the delay in reaching practical completion.
17. The ultimate impact of the confusion was that, other than one building service complaint in each of the proceedings which was listed for hearing and finally determined on 26 March 2019, all other complaints comprising proceedings CC 1436, CC 1438 and CC 1439 of 2017 were overlooked for some period of time and the files were administratively closed.
18. The contractual delay claim brought by the applicant against the respondent in relation to each of the three units was ultimately dismissed by the Original Tribunal on 21 January 2019. Whilst not expressly referring to the relevant provision, it appears clear from the terms of the order that the applicant's complaint in each proceeding was dismissed pursuant to s 46(3) of the State Administrative Tribunal Act 2004 (WA) (SAT Act) for want of prosecution.
19. The applicant then proceeded to lodge three new complaints in respect of the three units with the Building Commissioner on 16 May 2019. Each application contained 24 complaint items which again comprised a mixture of building service complaints and contractual complaints. Those complaints were referred by the Building Commissioner to the Tribunal on 21 May 2019 pursuant to s 11(1)(d) of the BSCRA Act and became proceedings CC 754 (in respect of unit C), CC 755 (in respect of unit B) and CC 756 (in respect of unit A) of 2019.
20. The Tribunal held a directions hearing in respect of the new referrals on 4 June 2019 at which time it became apparent that they contained a repetition of complaints previously lodged by the applicant with the Building Commissioner and which had been referred to the Tribunal. The Tribunal also raised with the parties on that occasion that complaint item 1 in each of the new referrals was a re-agitation of the previous complaint dismissed by the Original Tribunal on 21 January 2019. Pursuant to s 49 of the SAT Act the applicant required leave of a judicial member to bring those complaints again.
21. Following the conclusion of the 4 June 2019 directions hearing the Tribunal compiled a list of outstanding complaint items in respect of which no final order had been made in the previous six proceedings to enable the applicant to consider whether the complaints should be withdrawn or whether they remained on foot.
22. On 17 June 2019 the Tribunal, constituted by Deputy President Sharp and Senior Member Wallace, heard the applicant's application for leave pursuant to s 49 of the SAT Act. At the conclusion of the hearing, oral reasons were delivered and an order made granting leave, thereby enabling the applicant's complaints seeking compensation due to the delay by the respondent in reaching practical completion to be programmed to final hearing.
23. A further directions hearing was then held by the Tribunal on 1 July 2019 in order to identify all outstanding complaint items and to program them to final hearing. On this occasion the applicant informed the Tribunal that it wished to withdraw all outstanding complaints in proceedings CC 1436, CC 1438 and CC 1439 of 2017 (some of which had been lodged afresh) other than in respect of the complaint alleging that the respondent had engaged in misleading and deceptive conduct. The applicant also sought leave, and was granted leave, to withdraw a number of complaint items in each of CC 754, CC 755 and CC 756 of 2019.
24. The Tribunal made an order that each of CC 1436, CC 1438, CC 1439 of 2017, CC 754, CC 755 and CC 756 of 2019 and CC 943 of 2019 were to remain as separate proceedings but were to be heard concurrently with evidence filed in each proceeding to be evidence in each other proceeding. The applicant was ordered to file any further evidence on which it intended to rely by 29 July 2019. The respondent was required to provide all further evidence that it wished to rely upon by 26 August 2019.
25. Upon the applicant filing its evidence it notified the Tribunal that it sought leave to withdraw a further complaint item and leave was granted.
26. On 7 August 2019 the Tribunal made an order requiring the respondent by 26 August 2019 to inform the applicant and the Tribunal in writing which lay and expert witnesses it required to attend the final hearing in order to question their evidence. Subsequently the respondent informed the Tribunal that it did not wish to question any of the applicant's witnesses.
27. Ultimately the final hearing commenced on 10 September 2019 for a duration of two days. The decision was reserved at the conclusion of the second day of hearing.
28. The complaint items at the time of the final hearing which were before the Tribunal for determination were:
    1. In each of CC 1436, CC 1438 and CC 1439 of 2017 a complaint pursuant to s 5(2) of the BSCRA Act and s 17 and s 15A of the HBC Act alleging that the respondent engaged in conduct that was misleading or deceptive in respect of the circumstances in which the HBWCs were entered into and seeking compensation for loss or damage suffered pursuant to s 41(2)(d)(i) of the BSCRA Act.
    2. The following complaints in each of matters CC 754, CC 755 and CC 756 of 2019:

(a) a claim pursuant to s 5(2) of the BSCRA Act and s 17 of the HBC Act alleging breach of the HBWCs by the respondent due to a failure to achieve practical completion within the contractual time period specified and seeking compensation for loss and damage suffered as a result pursuant to s 41(2)(d)(i) of the BSCRA Act (complaint items 1 and 18 in each proceeding);

(b) a claim pursuant to s 5(1) of the BSCRA Act alleging that the respondent performed a regulated building service which was not carried out in a proper and proficient manner or which was faulty or unsatisfactory by causing damage to a boundary fence, located at the boundary of the applicant's property and a neighbouring property, whilst undertaking preliminary site works and seeking a building remedy order pursuant to s 36(1)(b) of the BSCRA Act (complaint item 10 in each proceeding);

(c) a claim pursuant to s 5(1) of the BSCRA Act alleging that the respondent performed a regulated building service which was not carried out in a proper and proficient manner or which was faulty or unsatisfactory in respect of demolition and associated works to an existing property at the site and seeking building remedy orders pursuant to s 36(1)(b) and s 36(1)(c) of the BSCRA Act (complaint items 2 and 11 in each proceeding);

(d) a claim pursuant to s 5(2) of the BSCRA Act and s 17 of the HBC Act that due to the respondent's repudiation of each HBWC the applicant incurred loss and damage by incurring costs in changing the keys and locks in each unit and therefore is entitled to compensation pursuant to s 41(2)(d)(i) of the BSCRA Act (complaint item 15 in each proceeding);

(e) a claim pursuant to s 5(2) of the BSCRA Act and s 17 of the HBC Act alleging breach of the HBWCs due to the failure of the respondent to supply and install clothes lines and seeking compensation pursuant to s 41(2)(d)(i) of the BSCRA Act (complaint item 20 in each proceeding);

(f) a claim pursuant to s 5(2) of the BSCRA Act and s 17 of the HBC Act alleging breach of the HBWCs due to the failure of the respondent to supply and install a termite barrier replacement system and seeking compensation pursuant to s 41(2)(d)(i) of the BSCRA Act (complaint item 21 in each proceeding);

(g) a claim pursuant to s 5(1) of the BSCRA Act and s 17 of the HBC Act alleging breach of the HBWCs given that the respondent installed single bowl sinks in each of the kitchens of the three units rather than double bowl sinks and seeking compensation pursuant to s 41(2)(d)(i) of the BSCRA Act (complaint item 22 in each proceeding);

(h) a claim pursuant to s 5(2) of the BSCRA Act and s 17 of the HBC Act alleging breach of contract by the respondent due to the failure to supply and install mailboxes, bricked and rendered for each of the three units and seeking compensation pursuant to s 41(2)(d)(i) of the BSCRA Act (complaint item 23 in each proceeding); and

(i) a claim pursuant to s 5(2) of the BSCRA Act and s 17 of the HBC Act seeking compensation for stress and anxiety as a result of the alleged breaches of contract pursuant to s 41(2)(d)(i) of the BSCRA Act (compensation claimed as part of complaint item 1 in each proceeding).

Evidence before the Tribunal

29. All of the evidence filed by the parties in respect of the applicant's complaints was compiled by the Tribunal into a hearing book comprising two volumes. Volume 1 was received into evidence as Exhibit 1 and volume 2 was received into evidence as Exhibit 2. A separate hearing book was prepared by the Tribunal in respect of the respondent's proceeding, which was accepted into evidence as Exhibit 3. Annexures to the witness statement of Mr Glen Wilkins dated 20 July 2018 (pages 25-50 of Exhibit 2) were accepted into evidence as Exhibit 4.
30. As is ordinarily the case, the hearing books which were before the Original Tribunal when the respondent's contractual claim was initially heard, were before this Tribunal at the rehearing. The hearing books in this regard were accepted into evidence by the Tribunal as Exhibits 5-8.
31. In addition, during the course of the hearing the respondent tendered a document entitled 'Addenda ­ Elemental Complete ­ Slate' dated 13 November 2015 which was accepted into evidence as Exhibit 9.
32. The Tribunal was also assisted by the receipt of oral evidence from the following witnesses:

(a) Mr Glen Anthony Wilkins, director of the applicant;

(b) Mr Rodney Martin, a lay witness relied upon by the applicant;

(c) Mr Richard Field, principal structural engineer, GF Consulting Structural Engineers, an expert witness relied upon by the applicant; and

(d) Mr Todd Buckley, director of the respondent.

Relevant factual background

33. The applicant purchased the relevant property in the suburb of Gosnells in late 2010. At the time of purchase it had an existing single storey brick and tile three bedroom residential property on the site. The applicant rented out the rooms in the existing property as a source of income.
34. In mid-2014 Mr Wilkins, the sole director of the applicant, began making enquiries with various building companies seeking to obtain quotes to develop the land located at the rear of the existing property as an investment.
35. Following those early discussions, Mr Wilkins decided to build three investment units on the site. He discussed his proposal with Mr Martin in or about August 2014. At that time Mr Martin was employed as a sales representative of Residential Building WA Pty Ltd, trading as In Vogue. Mr Martin gave Mr Wilkins a rough estimate at that early stage of approximately $600,000 to $650,000 to build the three units.
36. On 22 August 2014 the applicant paid the sum of $3,500 to Mr Martin to prepare the relevant drawings.
37. In October 2014 the drawings had been completed but at that stage the price to construct was outside of what the applicant could afford. Mr Wilkins and Mr Martin had another discussion at this time regarding the applicant's plans to rent the units out to enable Mr Wilkins to retire and live off the profit. Mr Martin told Mr Wilkins that he had a family friend who may be able to undertake the project within the applicant's budget. The family friend was Mr Buckley, director of the respondent.
38. Mr Martin and Mr Buckley met to look over the drawings and to discuss the project in early November 2014. Mr Martin's recollection of the discussion at that time was that he informed Mr Buckley that the intention of the applicant was to develop the property and build three units for the purpose of renting them out long-term; page 65 of Exhibit 2. On 3 November 2014 Mr Buckley confirmed with Mr Martin that he could construct the three units for an indicative price of under $630,000; page 66A of Exhibit 2. Mr Buckley denied that he was told by Mr Martin that it was the applicant's intention to rent out the three units following construction; ts 104, 10 September 2019.
39. Mr Wilkins and Mr Buckley met on site in or around mid-November 2014 at which time Mr Buckley confirmed with Mr Wilkins that the three units could be constructed at a total price of around $620,000.
40. It was important to Mr Wilkins at this stage that he ensure that the project was financially viable. He therefore contacted Ray White Real Estate in Canning Vale to ascertain the likely rent that he would achieve once the three units were constructed. He received a rental appraisal on 13 November 2014 informing him that the properties should receive a rent of approximately $360-$380 per week; page 111 of Exhibit 2. Mr Wilkins decided at that stage to proceed with the respondent.
41. A further meeting then took place on site between Mr Wilkins and Mr Buckley in January 2015. It seems that primarily the discussion was in respect to site works that needed to be undertaken. There was also a discussion in regard to the requirement for preliminary works to be performed to ensure access to the rear property and available underground power. In respect of access, a carport attached to the existing property needed to be demolished in order to create an access track. Western Power works were also required in order to remove an aerial service for the existing property and to establish underground power sufficient to service the existing property and the three additional proposed units.
42. The parties' positions are consistent that this conversation took place at this time and they also agree that Mr Buckley estimated that the demolition and Western Power works would cost approximately $20,000 to perform. The divergence in positions is in respect to whether the performance of the works was a stand-alone contract or whether it constituted site works that formed part of provisional sum allowances in the three HBWCs which were soon to be entered into by the parties.
43. The applicant's position is that the agreement was to pay $20,000 upfront to enable the project to proceed without delay but which would then be refunded once the HBWCs were executed and works had started to commence. The respondent's position is that the works were additional and entirely separate to the anticipated HBWCs.
44. On 19 May 2015 the respondent issued an invoice to the applicant in the amount of $20,342 in respect of the demolition and Western Power works; page 85 of Exhibit 2. The invoice identified that the following works would be performed by Western Power and others:

(a) removal of existing aerial service from pole S84195;

(b) installation of new 25LV cable off existing 240LV cable at the base of the pole S84195. T-Joint 25LV cable to 240LV cable; and

(c) installation of new mini pillar ­ LSH(DCSH U8) of proposed driveway. Approximately 3 metres from common boundary of #128.

45. The Western Power works totalled $10,542. The second part of the invoice was in respect of demolition of the existing carport in the amount of $9,800.
46. On 22 May 2015 the parties entered into three HBWCs in respect of the three units each valued in the amount of $202,613.33.
47. On 9 June 2015 the applicant paid $20,000 towards the 19 May 2015 invoice with the remaining $342 paid on 10 June 2015.
48. In July 2015 the works commenced in relation to the demolition of the existing carport. Then in October 2015 other site works commenced.
49. On 13 November 2015 the building permit in respect of the three units was issued by the City of Gosnells.
50. In early December 2015 Mr Wilkins noticed that there was a significant lean in the boundary fence toward the neighbour's property that appeared to have been caused by piles of sand being deposited against the fence during the course of the respondent undertaking the site works. This was communicated to the respondent on 7 and 8 December 2015 by way of email; pages 132 and 134 of Exhibit 2.
51. On the basis that the HBWCs allowed 180 working days for completion, the applicant had been anticipating that the construction would be concluded in or around March 2016. This did not occur.
52. On 20 June 2016 Mr Wilkins requested, for the first time, a breakdown of expenditures in respect of the provisional sums contained in each of the HBWCs; document 18, volume 2 of Exhibit 4.
53. On 21 June 2016 the respondent requested payment for lock-up in respect of unit C and in July 2016 requested lock-up payment in respect of units A and B. The lock-up payments were paid by the applicant.
54. On 28 June 2016 Mr David Hillman leased the front master bedroom in the existing property for $190 per week.
55. On 4 July 2016 the respondent provided costings in respect to each of the three units which had been incurred in respect of electrical and plumbing, site hire and earthworks and site clean as at 22 June 2016. On 4 July 2016 the applicant responded by seeking a detailed breakdown of the provisional sums. The respondent informed Mr Wilkins that because the works were continuing to be carried out, the final breakdown would not be able to be provided together with supporting invoices until practical completion had been reached; document 20, volume 1 of Exhibit 4.
56. Also around this time, in early July 2016, Mr Wilkins first noticed ceiling damage in two of the bedrooms in the existing property. Photographs were taken of the cracked ceiling gyprock plasterboard; document 19, volume 2 of Exhibit 4. The respondent was informed of this issue by email on 11 July 2016; page 128 of Exhibit 2.
57. Having received no response, Mr Wilkins emailed the respondent again on 30 July 2016 noting the following:

This weekend, the sagging of the roof became so bad, the gyprock inside the bedroom closest to the wall, has cracked, and is now at risk of falling. Could you please advise if Todd has made arrangements for this repair soon or not, as we will have to start repairs asap. We have started to call around looking for trades people due to the urgency, but needed to ensure we were not interfering with Todd's works, however given this has been an ongoing issue, we feel we are being left no option but to repair ourselves, to ensure no further damage to the house occurs.

Awaiting your reply.

(page 129 of Exhibit 2)

58. On 5 August 2016 the applicant provided the respondent with a notice of proposed complaint to be filed with the Building Commissioner. The proposed complaint included a complaint in respect of the damage to the roof of the existing property. The applicant then proceeded to obtain independent expert reports in respect to the existing property and in respect to what defects existed in each of the three units.
59. Around late August 2016 Mr Hillman, the applicant's tenant of the master bedroom in the existing property, attempted to secure the ceiling with some screws to try and prevent it from collapsing; page 37 of Exhibit 2 and ts 83, 10 September 2019. However, on 14 September 2016 Mr Hillman vacated the property because of his concern that the ceiling was leaking water and would collapse; pages 38 and 67 of Exhibit 2.
60. Eventually the ceiling in the front master bedroom of the existing property collapsed in December 2017. When it collapsed it brought down the ceiling fan which damaged the bedroom furniture, a television and the timber flooring.
61. On 22 January 2018 the respondent declared that practical completion had been achieved and issued the final progress payments in respect to each of the three units. The final progress payments were not paid by the applicant on the basis that it contended that practical completion had not been achieved.
62. On 23 February 2018 the applicant discovered that the air conditioning systems had been decommissioned due to non-payment of the contractor.
63. On 7 March 2018 Mr Wilkins observed that the hot water systems to units A and B had been removed.
64. Then on 17 March 2018 the air conditioning contractor, Mr Adam Kable, attended the property and informed Mr Wilkins that he was there to remove the air conditioning systems due to non-payment by the respondent. The air conditioning units were removed on that date.
65. On 20 March 2018 the respondent undertook rectification works requested by the applicant which included the installation of puddle flanges and rectification work to the stairs.
66. On 22 March 2018 Mr Buckley attended the site and removed the hot water unit at unit C; page 44 of Exhibit 2.
67. On 27 March 2018 the applicant terminated each of the HBWCs and took possession. The termination notice asserted repudiatory conduct by the respondent in two material aspects:

(a) an overrun of the date for practical completion of nearly two years; and

(b) the removal of the air conditioning systems and hot water units, after the date that the respondent claimed practical completion had been achieved.

68. The termination notice accepted the respondent's repudiation and gave formal notice of termination; document 46, volume 1 of Exhibit 4.

CC 1436, CC 1437 and CC 1439 of 2017

Complaint of misleading or deceptive conduct

Relevant legal principles

69. Section 5(2) of the BSCRA Act entitles an applicant to make a complaint in respect of a HBWC about a matter referred to in s 17 of the HBC Act. Section 17(1)(a)(ii) refers to provisions in Pt 2 of the HBC Act. Section 15A is contained within Pt 2 of the HBC Act and provides as follows:

A person who is a builder or an owner must not, in connection with -

(a) the formation or execution of a contract; or

(b) negotiations to vary a contract after execution; or

(c) the circumstances in which a contract or variation of contract is entered into,

engage in conduct that is misleading or deceptive.

70. One of the most useful and often cited statement of the relevant principles applied when determining whether conduct is misleading or deceptive is that of McHugh J in Butcher v Lachlan Elder Realty Pty Ltd [2004] HCA 60; (2004) 218 CLR 592 at [109] as summarised by Macaulay J in Vouzas v Bleake House Ptd Ltd [2013] VSC 534 at [107]:
    • whether the conduct is misleading or deceptive is a question of fact;
    • in determining whether a contravention of the particular statutory provision has occurred the task is to examine the relevant course of conduct as a whole in light of the relevant surrounding facts and circumstances;
    • it is an objective question that the court or tribunal must determine for itself; and
    • the effect of any relevant statements or actions or any silence or inaction occurring in the context of a single course of conduct must be deduced from the whole course of conduct.
71. The standard of proof is on a balance of probabilities. However, given the seriousness of the allegations in complaints of misleading or deceptive conduct, it is necessary for the Tribunal to feel an 'actual persuasion' of the occurrence of the oral representation; Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336 at 361.
72. It is not necessary for the Tribunal to find that the respondent intended to mislead or deceive the applicant. Contraventions of the legislation can occur even in circumstances where a respondent has acted reasonably and honestly; French CJ, Crennan and Kiefel JJ in Google Inc v ACCC (2013) 249 CLR 435 at [6]-[9].
73. In claims of misleading and deceptive conduct there are therefore three questions that need to be answered:
    1. Was the alleged representation made?
    2. If established that the representation was made, was it misleading or deceptive?
    3. Did the applicant rely on the representation such as to cause loss or damage? If so, what is the quantification of that loss or damage?

Evidence relied upon by the parties

74. The applicant relies solely on the evidence of Mr Wilkins in relation to this complaint. In respect of whether the representation was made by the respondent, the applicant's contention is that an oral representation was made through the respondent's director, Mr Buckley, to Mr Wilkins in or about January 2015. Mr Wilkins' evidence is set out at pages 27 and 28 of Exhibit 2, being his 2019 witness statement filed in these proceedings.
75. Mr Wilkins gave evidence in his witness statement that Mr Buckley told him in January 2015 that the demolition of the carport of the existing property would be included in the HBWCs as site works and included:
    • demolition of the back room and the carport on the existing property; and
    • the removal of trees, two sheds, the basketball court and sand levelling of the lot.
76. In or about this time, in early January 2015, Mr Wilkins states (page 28 of Exhibit 2) that Mr Buckley also told him that a power supply installation by Western Power was required and that this was also included in the site works as provided for in the HBWCs.
77. Mr Wilkins dealt with the matter in more specificity during his oral evidence at the hearing. He gave the following evidence to the Tribunal:

WILKINS, MR: ... Todd was like, you know, 'If we remove the side of the house now and drop the power line, we can get in there quick and get it ready for the trucks'. So, to come in and, you know, level out, so it's all ready to go bang, bang, bang, before the finance had come through. So I said, 'Okay, no worries. We'll send the' ­ I said ­ that's right, 'Is that' - you know, 'Is that included in the site works?' 'Yes, it is'. 'Cool. No worries'. 'How will I get that money back?' 'Oh, at the end it will come off'. And so I'm, 'Okay. No worries'. So I said to him, I said, 'Well, if you're going to send me an invoice through for what you're doing'. ...

(ts 55, 10 September 2019)

78. The Tribunal questioned Mr Wilkins in relation to his perusal of the HBWCs which were executed on 22 May 2015 as follows:

TRIBUNAL: So when you looked through the contract, did you see anything in there that provided for a payback or deduction for the amount that you've paid? Was there any ­ did you check for any provision?

WILKINS, MR: No. ... I was just going off what he said: that it was part of site works.

(ts 56, 10 September 2019)

79. The Tribunal also questioned Mr Wilkins in relation to the addenda to the HBWCs and asked the following questions:

TRIBUNAL: Do you see that it says: Demolition not included?

WILKINS, MR: Yes. I can see that there. Yes.

TRIBUNAL: Do you recall looking at that which might have indicated that perhaps the 20,000 was not part of the site works because your contract didn't include demolition?

WILKINS, MR: Yes. I'm just trying to think back. I - I wasn't really that thorough back then.

(ts 57, 10 September 2019)

80. Mr Buckley in oral evidence before the Tribunal strongly refuted the evidence of Mr Wilkins in regard to any oral representation being made. Mr Buckley gave evidence that the conversation that took place was as follows:

BUCKLEY, MR: I said, 'You've got a garage on the right ­ or a carport on the right-hand side'. I said, 'So, first of all, you can't get access delivery of the property, so that needs to be demolished. You need to create an access track. Second point is you have a power line that sits outside the house that will create obstruction to trucks in terms of height'. ... I said 'Okay. You're happy you can get all that done?' 'I ­ I'm not ­ I'm not confident. I wouldn't know where to start with Western Power or demolition or anything like that.' I said, 'Not a problem.' I said, 'My company is happy to do it and we can do it but we're going to charge you for it', you know, 'And this is what ­ this is roughly sort of what we're looking at'[.]

(ts 111, 10 September 2019)

81. Mr Buckley also gave evidence to the Tribunal in respect to the works involved:

... and this quote is here in terms of Western Power, item 1, is purely for Western Power's works. To clarify that, works are sent off to Western Power, they come back with a quote. They say, 'Yes. This is what it's going to cost us to remove this, put in underground power, upgrade the power dome so it can service four one (indistinct) house and three existing units.' They sent back the quote and you pay for those works and then they go and do it. It's not on an account whatsoever, so you pay for it and then they go do the works or book it when they're free. Their subcontractors go and do it. It's not technically Western Power and I have no control over that whatsoever. This was explained to Mr Wilkins. I said, 'Listen, I've got to go away to Western Power, I've got to get quotes to get these power lines removed from overhead to underground.' That was all done. At no stage did I say, 'This is part of the building contract' ... If this invoice or works were part of the contract, it would state in the contract that those works are part of that in this particular contract, so it's clearly a separate agreement and it always has been a separate agreement.

(ts 111, 10 September 2019)

82. The invoice each witness mentions in their evidence appears at page 85 of Exhibit 2 and is dated 19 May 2015 in the amount of $20,342; see [44]-[45] above.

Determination

83. The applicant submitted to the Tribunal that but for the misleading and/or deceptive representation made by the respondent, it would not have made the payment of $20,342 and would have, alternatively, priced those works with other registered builders.
84. In the Tribunal's view, the alleged oral representation, in the terms identified by Mr Wilkins in his oral evidence, was not made by Mr Buckley. Whilst the Tribunal accepts Mr Wilkins' evidence that there was a discussion which took place in January 2015 and an agreement reached by the parties that the respondent would undertake the works as described in the 19 May 2015 invoice and that those works were generically referred to as 'site works', the Tribunal does not accept that Mr Buckley said words to Mr Wilkins to the effect that the cost of those works would be refunded to the applicant.
85. In the Tribunal's view, it is more probable that the discussions which took place between the parties led to some confusion on Mr Wilkins part because it appears that the discussion in January 2015 encompassed both the additional Western Power and demolition works, as well as the site works which were to be performed under the HBWCs. It appears clear to the Tribunal that Mr Wilkins believed that all site works would be covered by the HBWCs. The Tribunal, however, does not accept that Mr Wilkins was of this view because of an oral representation made in the alleged terms by Mr Buckley.
86. In this regard the Tribunal found Mr Buckley to be a credible witness in his oral evidence which has been referred to above. In addition, Mr Buckley's evidence is corroborated by the contemporaneous documents that were created at the time including:

(a) The 19 May 2015 tax invoice was clearly a stand-alone document and did not refer to any set off or anticipated deduction or pay back of the $20,342.

(b) The HBWCs which were entered into by the parties on 22 May 2015 clearly do not include the relevant works identified in the 19 May 2015 invoice.

(c) In particular, the addenda to each of the HBWCs which were executed by the applicant on 24 May 2015 specifically under the heading 'site works' identified that demolition was not included; page 407 of Exhibit 1.

(d) None of the HBWCs executed by the parties contained any provision providing for a refund to the applicant in respect of site works paid upfront.

87. Lastly, if we are incorrect in our finding that the alleged representation was not made, the Tribunal in any event would be unable to find that the applicant has suffered any loss or damage. Although the applicant has submitted to the Tribunal that, but for the representation being made, it would not have made payment and would have obtained quotes from other builders to perform the works, the applicant failed to provide any evidence to the Tribunal that it could have secured another builder to perform the works at a lesser price. It may in fact have been the case that the applicant could not have secured a builder to perform the works at a lesser price. But in any event, given that there was no evidence of any loss suffered, the claim could not succeed.
88. For those reasons the claim for misleading or deceptive conduct which has been made in each of proceedings CC 1436, CC 1438 and CC 1439 of 2017 will be dismissed.

CC 754, CC 755, CC 756 of 2019

Claim for delay in reaching practical completion

89. It was not in dispute in the proceedings that there had been significant delay in the respondent reaching practical completion of each of the three units and the respondent conceded that it had breached clause 9 of each of the HBWCs in respect of time for performance.
90. What is in dispute between the parties is whether the applicant has suffered loss and damage in the nature that it asserts and if so whether that loss or damage is recoverable as against the respondent. In this regard the claim made by the applicant is set out in the expert report of Mr Michael Watson of Advali dated 7 February 2019 which appears at pages 289-293 of Exhibit 1 as follows:

(a) loss of rent in respect of unit A during the period 8 August 2016 to 27 March 2018, being 85 weeks at $300 per week totalling $25,500.

(b) loss of rent in respect to unit B during the period 8 August 2016 to 27 March 2018, being 85 weeks at $300 per week totalling $25,500.

(c) loss of rent in respect to unit C during the period 8 August 2016 to 27 March 2018, being 85 weeks, at $325 per week totalling $27,625.

(d) the applicant also claims interest charged on its mortgage up to 31 January 2018 in the amount of $28,142 plus interest charged on an ANZ credit card held in the name of Mr Wilkins which was used to purchase replacement air conditioning units and on which interest was charged in the amount of $974.

Relevant legal principles

91. The general rule in respect of damages for breach of contract is as stated by Parke B in Robinson v Harman [1848] EngR 135; (1848) 1 Exch 850 at 855:

The rule of the common law is, that where a party sustains a loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed.

92. An applicant cannot, however, achieve betterment or a superior position through an award of damages for breach of contract, than the position they would have been in if the contract had been performed; Commonwealth v Amann Aviation Pty Ltd [1991] HCA 54; (1991) 174 CLR 64at 82.
93. As to the measure of damages, or what type of loss an applicant can claim, it is necessary to apply the rules as set out in the well-known case of Hadley v Baxendale [1854] EngR 296; (1854) 9 Exch 341 where the court found as follows:

Where two parties have made a contract which one of them has broken, the damages which the other party ought to receive in respect of such breach of contract should be such as may fairly and reasonably be considered either arising naturally, i.e., according to the usual course of things, from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it. Now, if the special circumstances under which the contract was actually made where communicated by the plaintiffs to the defendants, and thus known to both parties, the damages resulting from the breach of such a contract, which they would reasonably contemplate, would be the amount of injury which would ordinarily follow from a breach of contract under these special circumstances so known and communicated. But, on the other hand, if these special circumstances were wholly unknown to the party breaking the contract, he, at the most, could only be supposed to have had in his contemplation the amount of injury which would arise generally, and in the great multitude of cases not affected by any special circumstances, from such a breach of contract. For such loss would neither have flowed naturally from the breach of this contract in the great multitude of such cases occurring under ordinary circumstances, nor were the special circumstances, which, perhaps, would have made it a reasonable and natural consequence of such breach of contract, communicated to or known by the defendants.

94. Thus there are two limbs in respect of loss suffered as a result of breach of contract:

(a) a direct and naturally arising loss which would be within the reasonable contemplation of both parties; and

(b) an indirect or consequential loss which only arises if the party in breach was put on notice prior to or at the time of execution of the contract that this would be a loss suffered if breach occurred.

Evidence relied upon by the parties

95. The Tribunal had before it a witness statement of Mr Rodney Martin (pages 63-66A of Exhibit 2) in which Mr Martin gave evidence that he met with Mr Buckley at a Dome Café in Leederville in early November 2014. Mr Martin states that during the discussion which took place he specifically recalled informing Mr Buckley that the applicant wished to construct the three units for the purpose of renting them out long-term and that the applicant had no intention of selling the units. Mr Martin also gave oral evidence to the Tribunal in this regard as follows:

MARTIN, MR: ... I specifically made topic of that conversation with Todd on the day that I found Mr Wilkins a bit of a hippy and that I had discussed with him the option of doing this development and that from my first appearance from Todd ­ sorry, from Glen being a bit of a hippy, he surprised me with his lack of understanding and his plan to develop as a retirement plan for the future. I made comment of it to Todd, to make him aware that although Glen looks like a bit of a hippy, he's pretty aware and he has got a very clear understanding, and his intention is to use these as part of a retirement plan. And that was a clear conversation we had. There was no intent anyway to sell them. So the fact that Glen had clarified to me that he would be living in the front property and renting the three out, and that was discussed with Todd for the purpose of ...

TRIBUNAL: So your evidence is that you said to Mr Buckley, 'Mr Wilkins intends to live in the existing original property'? - - - Yes. And the three other properties were investment for the purpose of rent? - - - Correct. ... And that is your specific recollection of the conversation? - - - Yes. And did Mr Wilkins at any stage say to you that there was a possibility that he would sell - - - No. - - - the properties? - - - No, and that was not in his plan.

(ts 47-48, 10 September 2019)

96. Mr Wilkins also gave oral evidence to the Tribunal as to his pre­contractual conversations with Mr Buckley on site as follows:

WILKINS, MR: ... So basically, Todd comes round, meets us. He goes, 'What are you going to do?' And I'm just like, 'Hey. This is what I'm going to do. I'm going to build these units and I'm going to rent them out and then live off the difference from the interest only.' And you know, then I won't ­ I won't have to work anymore.

...

TRIBUNAL: And did you talk about the existing property? - - - Yes. ... I've got a share-house at the front. Yes. And it's basically, you know, I get rent from each one of those rooms and then, you know, I get rent from the units. And the difference in my mortgage will be the income for me. I was quite proud of working it out and all that sort of stuff.

TRIBUNAL: So you told him you were renting out rooms - - - Yes. in the front property? So why did that sort of come up in the conversation? - - - What do you mean?

TRIBUNAL: How did that arise, because - - -? - - I don't know. Like, it just ­ we just ­ I ­ because I was quite proud of what I was doing and I just wanted to tell everyone. ... This is my plan. This is what I'm doing. ... this is how I'm going to do things different from everyone else, you know, instead of working 30 years and like, you know, relying on your super or whatever. So this will be my super. This would be how I retire. This would be a forever thing that I've always got that I can live off that difference. ... So I was quite proud to tell people that that was my plan because in that manner, I've got all this smarter in my head than a lot of other people that don't necessarily think the same way. ... So I just told everyone. I told him multiple times of what I was doing. There's no ­ there has never been any doubt.

(ts 66-67, 10 September 2019)

97. The applicant also relied on a letter sent by the respondent to the applicant's lawyers on 12 September 2016 (para 99, pages 37-38 of Exhibit 2 and document 26, volume 1 of Exhibit 4) which at para 11 responded to the applicant's claim in respect of lost rental income due to delay as follows:

We acknowledge and disagree with point 11 of your letter. Yes your client has made Mener Group aware of his intentions to construct these properties as investment properties. However, we dispute the value of weekly rent of each property. Current listings of properties in the area of a similar workmanship and standard are currently being advertised for $251 p/week.

In addition to this, your client has on two separate telephone conversations to both directors of Mener Group, expressed his concern with the falling rental prices of the Gosnells area due to economic times since he commenced the decision to develop his property. Your client quoted numbers of $250 p/week as the average rent that he would be likely to receive due to the market conditions. This contradicts the numbers indicated in point 11 of your letter.

98. Mr Buckley gave evidence to the Tribunal denying that Mr Martin and Mr Wilkins told him that the three units were being constructed for the purpose of a rental investment. Mr Buckley gave the following oral evidence to the Tribunal:

MR BUCKLEY: ... we had a brief conversation of probably 15 minutes, I would say, at a Dome Café in Leederville. I confirm that. That's true and correct. With regards to him stating that, you know, this is a retirement plan and this is his philosophy on what he wants to achieve in regards to this project. I was never told that. ... Subsequently, I caught up with Mr Wilkins. We had a bit of a chat. He told me, 'Hey, I want to build three units'. He never highlighted to me retirement plans and how he thought this is a wonderful thing and outside of the box. Like, I was never told any of this. I was just told, 'I want to build three units. I've got a tight budget of 600,000. Can you do it?' I said, 'Not a problem. Give me the plans, give me what you want to build, roughly, so I can get an idea of what you're thinking'. ... So this whole premise of, you know, it's my retirement plan and this whole wonderful idea, supposedly, is - I don't - is - is not correct. ... The only conversations that were had were I'm potentially going to look to sell these to - to get some money and I've made that statement previously when Mr Wilkins was in the witness box[.]

(ts 104-105, 10 September 2019)

Determination

99. The Tribunal found both Mr Martin and Mr Wilkins to be credible witnesses in respect to this evidence. Their evidence was entirely consistent with one another and unwavering. In particular, it was evident to the Tribunal during the course of Mr Wilkins' oral evidence that he was immensely proud of his retirement plan in regards to both renting out the three units and renting out the rooms in the existing property. The Tribunal accepted his evidence entirely that he communicated this information to Mr Buckley on many occasions, as he did so to other people including Mr Martin.
100. The evidence of Mr Wilkins was also supported by the contemporaneous steps that he took to ascertain the likely rental income which would be derived from the three units prior to entering into the HBWCs with the respondent; page 111 of Exhibit 2.
101. In all the circumstances, therefore, we do not find Mr Buckley to be a credible witness in respect to this part of his evidence. This is particularly so given the respondent's own letter dated 12 September 2016 referred to at [97] above.
102. We are therefore persuaded on a balance of probabilities that the respondent was well aware that the units would be used as rental investments and thus was aware that if there was delay in performing the HBWCs that a consequential loss which would be suffered by the applicant would be a loss of rental income.
103. In respect of the calculation of the period of delay, each of the HBWCs contains an identical provision in respect of time for performance, being clause 9; pages 333, 383 and 433 of Exhibit 1. Clause 9(a) provides as follows:

Subject to this Contract the Builders shall commence the Works within the number of working days specified in Item 9(a) of the Schedule or as soon thereafter as may be reasonably practicable calculated from the latest of the following dates:

(i) on which the Owner shall have complied with the conditions referred to in Clause 2;

(ii) on which the Owner satisfied all requirements under Clause 3(c), if applicable, and Clause 3(d);

(iii) on which the Builder is satisfied that the boundaries of the Site have been adequately delineated;

(iv) on which the Builder is satisfied that both an adequate water supply and an adequate water supply for the carrying out of the Works are available to the Site;

(v) on which the Builder has received approval from all relevant authorities.

104. The schedule of particulars in each HBWC provides that the time to commence works in clause 9(a) is 14 working days.
105. The Tribunal finds that the building permit, which was issued on 13 November 2015, constitutes the latest of the dates provided in clause 9(a) of the HBWCs and thus time to commence began 14 working days following that date; pages 271-273 of Exhibit 2.
106. The obligation of the respondent to commence works was therefore 3 December 2015.
107. Clause 9(b) of each of the HBWCs required the respondent to complete the works to 'practical completion'; pages 333, 383 and 433 of Exhibit 1. The schedule of particulars in each HBWC specified that practical completion needed to be achieved within 180 working days; pages 375, 325 and 425 of Exhibit 1.
108. The respondent did not seek any extension of time for completion of the works due to any delay and thus was required to strictly complete the works within the 180 working days specified. Thus each of the three units were required to be completed by 24 August 2016.
109. As to the date that the respondent reached practical completion, the applicant contended that practical completion had never been achieved. However, the Tribunal raised with the applicant during the hearing that by terminating each of the HBWCs on 27 March 2018 the applicant brought the period of delay to a conclusion. In this respect, terminating the HBWCs was a mitigatory step taken by the applicant and at that point the applicant took on the responsibility to ensure that each unit reached practical completion, if it had not done so by that date. The Tribunal therefore finds that the termination date is the end date on which delay ought to be calculated.
110. On the Tribunal's calculations, the period of delay between 24 August 2016 and 27 March is 398 working days or 79 weeks.
111. At this point we ought to address the reason for the discrepancy in the Tribunal's findings, and the calculations as set out in the applicant's expert report of Advali. As previously noted at [90] Advali calculated the period of delay as totalling 85 weeks. In the Tribunal's view there are errors in Advali's calculations. Firstly, the latest date from which to calculate the date of commencement of the works pursuant to clause 9(a) of the HBWCs is clearly the date of the building permit. Thus the commencement date used by Advali of 8 August 2016 is incorrect. In addition it appears that Advali in its calculations of the delay period has used days, rather than working days (as required by each HBWC). This results in inflating the delay period slightly. Once these errors are corrected, the delay period reduces to 79 weeks.
112. The applicant, having terminated the HBWCs on 27 March 2018 proceeded to take steps to secure tenants for each unit. The properties were advertised on Gumtree at no cost and the applicant intended to self­manage the units.
113. Unit B was the first property in respect of which a residential tenancy agreement was executed on 9 May 2018; document 41, volume 2 of Exhibit 4. The agreed weekly rental was $250. Mr Wilkins informed the Tribunal that a reduced weekly rent was agreed because at the time of tenancy the unit did not have a gas hot water system installed and the tenant agreed to install it himself; ts 153, 11 September 2019.
114. A residential tenancy agreement was then executed in respect of unit A on 31 May 2018 for a weekly rent of $299; document 46, volume 2 of Exhibit 4.
115. Finally, a residential tenancy agreement was executed in respect of unit C on 17 June 2018 for a weekly rent of $325; document 55, volume 2 of Exhibit 4.
116. In the Tribunal's view the residential tenancy agreements reasonably reflect the amount of rent that the applicant would have received if the properties had not been delayed in reaching practical completion, other than in respect of unit B, where the Tribunal accepts the applicant's submission that a reduced rent was agreed for the reasons articulated. In the Tribunal's view unit B would otherwise have received the same rental income as unit A, those properties being comparable in all respects.
117. The rental loss suffered by the applicant is therefore as follows:

(a) Unit A, 79 weeks at $299 per week totalling $23,621.

(b) Unit B, 79 weeks at $299 per week totalling $23,621.

(c) Unit C, 79 weeks at $325 per week totalling $25,675.

118. In relation to the applicant's claim in the amount of $28,142 reflecting the interest charged to the mortgage in respect of the three units, the Tribunal finds that that loss is not one suffered as a result of the breach of contract by the respondent. The applicant would have in any event paid interest on its mortgage. It is therefore not a recoverable claim.
119. In relation to the ANZ credit card interest claimed by the applicant, the Tribunal notes that it is a credit card obtained in the personal name of Mr Wilkins and is not a credit card in the name of the applicant. Further, this claim does not appear to relate to the breach of contract claim for the delay in reaching practical completion. It is also a claim that would not in any event be in the contemplation of the respondent as at the time of execution of the HBWCs as an anticipated consequential loss which would be suffered by the applicant if there were delay in reaching practical completion. For each of those reasons the Tribunal finds that this is also not a loss that the applicant is able to claim.
120. The Tribunal will therefore be making orders in favour of the applicant in respect of complaint item 1 pursuant to s 41(2)(d)(i) of the BSCRA Act as follows: in CC 754/2019 in the amount of $25,675, in CC 755/2019 in the amount of $23,621 and in CC 756/2019 in the amount of $23,621. Complaint item 18 in each proceeding, however, will be dismissed.

Building service complaint ­ damage to boundary fence

121. The applicant alleges that the respondent, in performing the works the subject of the HBWCs, performed a regulated building service which was not carried out in a proper and proficient manner or which was faulty or unsatisfactory pursuant to s 5(1) of the BSCRA Act due to damaging a boundary fence. If the Tribunal is satisfied that the complaint has been substantiated it can make a building remedy order; s 38(1)(a) and s 36(1) of the BSCRA Act. The applicant seeks a monetary order rather than an order requiring remedial works to be performed.
122. Whilst the complaint has been made in respect of each of CC 754, CC 755 and CC 756 of 2019, it is the Tribunal's view that the complaint can simply be raised in one of the proceedings and does not need to be duplicated given that it is not a contractual complaint. This is on the basis that it is a building service complaint and the applicant has standing as an aggrieved party.
123. It was not in dispute between the parties that the boundary fence in question has a significant lean in it and that there is also a crack along the length of it in certain parts. What is in dispute is whether the damage to the fence was sustained as a result of the regulated building service carried out by the respondent.

Relevant legal principles

124. Section 38(1) of the BSCRA Act confers a discretion on the Tribunal as to whether to make a building remedy order in favour of an applicant, and if so, s 36(1) of the BSCRA Act confers a discretion on the Tribunal as to the nature of the building remedy order - whether in monetary terms or by specifying work to be performed.
125. The exercise of the discretion cannot be fettered by the Tribunal simply adopting the applicant's election as to the nature of building remedy order it seeks; per Smith AJ as Her Honour then was in Gemmill Homes Pty Ltd and Sanders [2018] WASC 179 (Gemmill Homes) at [131] and [135]-[140].
126. However, the preference that an owner has as to the nature of the remedy is an appropriate matter to take into account when the Tribunal exercises its discretion pursuant to s 36(1) of the BSCRA Act; Gemmill Homes at [139]. Other relevant matters which can be taken into account when the Tribunal exercises its discretion, particularly when exercising its discretion to make a building remedy order in monetary terms, include whether there has been an irretrievable breakdown in the relationship between the parties (Trengove and Celebration Nominees Pty Ltd [2012] WASAT 65 at [36]); whether an owner has justifiably lost confidence in the workmanship and skill of the respondent (Nelson v Mardesic (1998) 22 SR (WA) 42); whether the respondent has attempted to remedy the regulated building service previously unsuccessfully and whether the respondent has refused to perform remedial work when invited to do so. This list of considerations is of course not exhaustive.

The parties' evidence

127. Mr Wilkins' oral evidence at the hearing was that the fence did have a slight lean in it prior to the respondent commencing site works, but that he observed the lean worsening significantly and a crack developing in it after the respondent's contractors piled large volumes of sand against the fence; ts 71 and 73, 10 September 2019. Mr Wilkins sent the respondent emails raising his concern about the tilting of the fence due to the storage of the sand on 7 and 8 December 2015; pages 132 and 134 of Exhibit 2.
128. The respondent submitted that the boundary fence was in significant disrepair prior to the commencement of the site works and makes reference to the 8 December 2015 email sent from Mr Wilkins which noted 'the whole fence isn't in best of conditions so makes it hard'; page 132 of Exhibit 2. Mr Buckley also gave oral evidence as follows:

I clearly saw that this fence was not in the best condition. There was obviously a passionfruit vine there overhanging ... There was a number of chips or, you know, small holes. It's a Super Six fence. It's probably the original fence that was done back in 1960. So there was always going to be, you know, minor damage to it. And I agree with Mr Wilkins' statement that the back right-hand corner of the fence as you look at the property had a lean on it. Like, there was a lean, you could see that.

(ts 114, 10 September 2019)

129. In response to questioning from the Tribunal as to whether the respondent had undertaken a pre-site inspection of the property, the following evidence was provided by Mr Buckley:

TRIBUNAL: Did you do a pre-site inspection of the site? - - - Yes. Yes.

TRIBUNAL: Is that in any of the documents? So did you an assessment of the site. Photos, report? ---There were photos taken, but not a particular report produced or given to Mr Wilkins. I don't - no. Only for myself.

(ts 116-117, 10 September 2019)

130. The Tribunal also had before it the benefit of a number of photographs taken of the fence prior to the commencement of the works by the respondent and during the works; document 7, volume 2 of Exhibit 4; page 588 of Exhibit 1 and pages 123-125, 172-174, 242 and 296-298 of Exhibit 2.
131. On the balance of probabilities, in the Tribunal's view this complaint is substantiated. The photographic evidence illustrates that whilst there was a slight lean in the boundary fence prior to works commencing, the tilt of the lean deteriorated significantly following the site works undertaken by the respondent. There also emerged following the site works commencing, a significant crack in the boundary fence which did not appear to exist prior.
132. The Tribunal found Mr Wilkins' evidence to be credible in respect of his observations of the fence at the time that the site works commenced, particularly following the storage of large piles of sand directly to the boundary fence by the respondent's contractors. Mr Wilkins' evidence is corroborated by the emails he sent at the time raising his concerns regarding the state of the fence with the respondent.
133. The Tribunal does not accept the submission made by the respondent that the lean in the boundary fence was as a result of foliage over-hanging the fence and was therefore pre-existing. In the Tribunal's view the most likely and probable cause of the damage to the fence is the site works undertaken by the respondent prior to commencement of the construction of the three units. In this regard the Tribunal finds that the coincidence of the two events, that is, the damage to the fence and the commencement of the site works (which incorporated piling large volumes of sand against the fence) are not merely mutually exclusive events. In the Tribunal's view, one led directly to an impact on the other.
134. In the Tribunal's view, by damaging the boundary fence in the manner described, the respondent has failed to take due care and diligence in the performance of the regulated building service and therefore has not carried it out in a proper and proficient manner.
135. Therefore the Tribunal is satisfied pursuant to s 38(1)(a) of the BSCRA Act that it ought to make a building remedy order pursuant to s 36(1) of the BSCRA Act.
136. As to whether the Tribunal should make a building remedy order in monetary terms or whether it should require specified work to be performed, the Tribunal's view is that a monetary order is appropriate taking into account the following relevant factors:

(a) Despite the respondent being aware of the complaint as early as December 2015, it has never offered to perform any remedial works to the boundary fence. Rather, it has always denied responsibility;

(b) The applicant has submitted to the Tribunal its strong preference for a building remedy order to be made in monetary terms;

(c) The relationship between the parties has irretrievably broken down. They have indeed been involved in highly contested litigation with each other in respect of the construction of the three units since December 2016, a period of almost three years; and

(d) The respondent did not submit to the Tribunal at any stage of the proceedings that it wished to be given an opportunity to perform remedial works to the fence.

137. The applicant has claimed an amount of $7,200 which is the quantum quoted by First Class Fencing on 11 February 2018 to remove the damaged fence and replace it with 36 metres of new HardieFlex or Bluescope Colorbond Fencing; page 237 of Exhibit 2. The Tribunal accepts the submissions of the applicant that the fence, given the extent of damage, cannot be repaired.
138. The Tribunal notes that the respondent did not file with the Tribunal any alternative quotation in respect of this complaint item.
139. The Tribunal has considered the quantification and considers it to be reasonable. The Tribunal will therefore make a building remedy order pursuant to s 36(1)(b) of the BSCRA Act in respect of complaint item 10 in the applicant's favour in that amount. The Tribunal intends to make the order in proceeding CC 754/2019 only. The complaint item will therefore be dismissed in the other two proceedings.

Building service complaint ­ rectification costs and consequential loss suffered to the existing property

140. The applicant has brought a building service complaint pursuant to s 5(1) of the BSCRA Act alleging that in respect of the existing property, the respondent performed a regulated building service which was not carried out in a proper and proficient manner or which was faulty or unsatisfactory on the basis that the demolition works were performed without properly sealing the property and making good thus allowing water ingress into the roof cavity of the property and thereby causing damage. The applicant seeks building remedy orders pursuant to s 36(1)(b) and (c) of the BSCRA Act as follows:

(a) the cost to rectify the damage sustained to the existing property in the amount of $17,550 plus GST which includes in the master bedroom and second bedroom removing and replacing the ceiling and cornices, sealing and painting the walls, door, doorframe and skirting, in the master bedroom replacing the blind and ceiling fan light, and in respect of both bedrooms, the passage, lounge and kitchen, sanding and sealing the jarrah floorboards; page 235 of Exhibit 2; and

(b) compensation due to the loss suffered by the applicant due to the inability to rent the master bedroom in the existing property from 14 September 2016 onwards at a rate of $190 per week; page 67 of Exhibit 2.

141. The respondent's position, in summation form, is as follows:

(1) The respondent disputes that it carried out the regulated building service in a manner which was not proper and proficient or which was faulty or unsatisfactory. Rather, the respondent contends that the water damage sustained was unrelated to the performance by it of the regulated building service.

(2) If the respondent is unsuccessful in respect of its position in (1) above, the respondent contends that the estimated rectification costs are excessive and not reasonable.

(3) If the respondent is unsuccessful in its contention in (1) above, it also contends that the rental claim is not a recoverable loss because the respondent was not made aware that the master bedroom of the existing property was intended to be rented; and further that the applicant has failed to mitigate its loss by not undertaking the requisite remedial works so as to enable the room to be rented at an earlier time.

The parties' evidence

142. The respondent accepted that the works in respect to the demolition of the carport were left incomplete for a significant period of time ­ nearly 10 months; ts 119, 10 September 2019. Mr Buckley in his oral evidence before the Tribunal also conceded that in leaving the works incomplete for that period of time, there was an opportunity for weather and water ingress to enter into the property given that it was effectively exposed to the elements; ts 119, 10 September 2019.
143. Mr Buckley, however, submitted that although water ingress could have entered the home due to the precarious state that the respondent had left it in, it could also have entered through other avenues including due to the condition of the external eaves; ts 120, 10 September 2019.
144. The applicant relied on the independent expert report of Mr Field who inspected the property on 6 August 2016 and concluded as follows:

It is obvious that the poorly secured tarpaulins have allowed water ingress into the roof space. The water has found its way onto the ceiling below where the tarpaulins are located near the gable end that was sheeted with HardiFlex. This has saturated the installation on the plasterboard ceiling and caused the ceiling to drop and crack.

...

It is our opinion the damage to the ceiling was caused by water penetration due to the long exposure to the weather after the car port was removed and the inadequate protection by the tarpaulins while the roof was re-roofed.

(pages 265-267 of Exhibit 1)

145. Mr Field was tested on his evidence during the course of the hearing and stated as follows:

FIELD, MR: ... So it seemed to me it was pretty obvious that, you know, the water damage was caused from water getting in through - in a lack of sealing or whatever of the - the roof that had been exposed, you know. So that seemed pretty obvious. I know.

... Well, there was nothing else that I could think of that would possibly have caused it. You know. So unless, you know, someone had gone up there and physically caused it.

... All I could judge on - well, I could see the damage, I could see the works and the state of what it was and that's how I assessed it.

(ts 99, 10 September 2019)

Determination

146. The Tribunal is satisfied on a balance of probabilities, that the respondent performed a regulated building service, being the demolition of the carport to the existing property, that was not carried out in a proper and proficient manner or which was faulty or unsatisfactory given that the works were left incomplete and exposed to the elements for a significant period of time. The Tribunal is also satisfied that in doing so water was able to ingress into the roof space and cause damage to the plasterboard ceiling in both the master bedroom and bedroom 2 which ultimately led to the collapse of the ceiling in the master bedroom causing damage and loss to furniture and to the underlying floorboards and walls.
147. The Tribunal does not accept the respondent's submission that the water ingress was caused by some other way. In this regard the Tribunal notes that the respondent did not obtain an independent expert report to support such a position; did not succeed in obtaining a concession in this regard from Mr Field during the course of his oral evidence; and indeed is not a position which could be supported by oral evidence from Mr Buckley himself given that at no stage once he became aware of the damage did he undertake an inspection; ts 122, 10 September 2019.
148. The Tribunal is therefore satisfied pursuant to s 38(1)(a) of the BSCRA Act that it should exercise its discretion to make a building remedy order pursuant to s 36(1) of the BSCRA Act. In relation to the type of remedy which ought to be made, the Tribunal is of the view that a monetary order ought to be made reflecting the reasonable costs the applicant will incur in engaging a third party to perform the works. The reasons why an order in such terms is appropriate are set out at [136] above. In addition, the Tribunal finds the conduct of the respondent in respect of this particular complaint, entirely unacceptable. It was frantically notified in writing a number of times and telephoned repeatedly, by a client who had found itself in a most urgent situation of risk to personal safety, and yet the respondent did not take even the most cursory steps to inform itself and to render the area safe; ts 119-124, 10 September 2019. In such circumstances, in the Tribunal's view, it has foregone its opportunity to return and now perform remedial works.
149. As to the cost to rectify the damage sustained to the property, the Tribunal has considered the quotation provided by Mr Bob Copley dated 1 June 2018; page 235 of Exhibit 2. Mr Copley is a registered builder and provided a quote in the amount of $17,550 plus GST for the works identified at [140(a)] above, totalling $19,305. Although the respondent contended to the Tribunal that the quote was excessive for the works to the undertaken, the respondent did not provide evidence to the Tribunal to support the contention by way of a quotation in a lesser amount. The Tribunal has considered the quotation and is of the view that it is reasonable and not excessive.
150. The Tribunal will therefore make a building remedy order pursuant to s 36(1)(b) of the BSCRA Act in respect of complaint item 11 in the applicant's favour in that amount. The Tribunal intends to make the order in proceeding CC 754/2019 only. The complaint item will therefore be dismissed in the other two proceedings.
151. In relation to the compensation claimed by the applicant pursuant to s 36(1)(c) of the BSCRA Act, in relation to the loss of rental in respect of the master bedroom, the Tribunal also finds that this claim is substantiated. Although the respondent submitted that it was unaware that rooms in the existing property were being rented out, the Tribunal accepts the contrary evidence of Mr Wilkins and has found him to be a credible witness in this regard (see [99] above). On that basis the rental loss is a loss that was foreseeable to the respondent as a natural consequence of its failure to carry out the regulated building service in a proper and proficient manner.
152. The Tribunal accepts the evidence that the master bedroom was being rented to Mr Hillman at an amount of $190 per week and that he ceased renting on 14 September 2016 due to his fear that the ceiling would collapse; page 67 of Exhibit 2. Mr Wilkins informed that Tribunal that no rectification works have yet been undertaken in respect to the master bedroom of the existing property and therefore the rental loss is continuing to be incurred.
153. In respect of mitigatory conduct, Mr Wilkins gave evidence that following the collapse of the ceiling of the master bedroom on 17 December 2017, some basic repairs were undertaken in June 2018 by using some old pieces of plasterboard and affixing them to the exposed rafters to provide a makeshift ceiling. This was done to prevent dust from entering the room as a temporary fix; pages 40 and 49 of Exhibit 2.
154. Mr Wilkins was questioned during the course of his oral evidence before the Tribunal as to why he did not take more substantive mitigatory steps to rectify the damage sustained to the front property and he gave the following evidence:

TRIBUNAL: And you waited that period of time. Why was that? - - -No money.

What was happening during that 12 months? - - - I've been keeping my head above water through this whole contract. I've had no money to get building insurance. To get, like, the gas hot water systems installed, I had to get credit cards and all that sort of stuff. The banks weren't helping with any more money. I was having problems with tenants not paying as well as lawyer fees as - it just - there was - and I'm trying to do it all on a - - - on a small wage and - - -

TRIBUNAL: So financially you were restricted from doing any substantive works? - - - Financially crippled. Yes. Yes. I was - there was no way. Yes.

(ts 83-84, 10 September 2019)

155. In addition Mr Wilkins gave evidence that he borrowed $30,000 from his father to assist in paying the expenses required in order to bring the three units to practical completion; para 158, page 45 of Exhibit 2.
156. The dire financial position of the applicant is further supported in the Advali report which noted a cash flow deficit for the applicant in the 2018 financial year of $72,463; page 291 of Exhibit 1.
157. It has long been the position that compensation or damages cannot be recovered for any loss that could have been prevented or reduced by the applicant undertaking reasonable mitigating action; Clark v Macourt (2013) 253 CLR 1; [2013] HCA 56 at [17]. In such circumstances the loss, or a proportion of the loss, is not caused by the breach, but rather is caused by the failure of the applicant to mitigate.
158. Whilst the principle of mitigation arises primarily in the context of the law of contract, it is of useful application in the Tribunal's determination as to what is an appropriate amount to compensate an applicant who alleges that they have suffered loss as a result of a respondent's failure to carry out a building service in a proper and proficient manner or which is faulty or unsatisfactory building work. This is because the same principle applies, in that, an applicant is only entitled to be compensated for loss that can be attributable to the performance of the building service. This is clear when one considers the wording of s 36(1)(c) of the BSCRA Act as follows:

An order that a person who carried out a regulated building service pay to an aggrieved person a sum of money specified in the order to compensate the aggrieved person for the failure to carry out the building service in a proper and proficient manner or for faulty or unsatisfactory building work.

(Emphasis added)

159. Therefore in this proceeding, the compensation must be for loss incurred due to the failure of the respondent to carry out the building service in a proper and proficient manner or which is faulty or unsatisfactory, and cannot be compensation for loss suffered by the applicant due to a failure by it to take reasonable steps available to it to reduce or mitigate the extent of the loss being suffered.
160. In the current context the applicant submitted that the lack of additional mitigatory steps undertaken was due to its impecuniosity. The Tribunal accepts this position. Again, gleaning assistance from the precedents arising in the context of breach of contract, the Tribunal notes that a failure to mitigate that is due to impecuniosity generally does not affect the recovery of damages, at least where the breach or offending conduct contributed to the applicant's lack of financial means; Burns v MAN Automotive (Aust) Pty Ltd [1986] HCA 81; (1986) 161 CLR 653 at 659.
161. The Tribunal is therefore satisfied that there was no failure to mitigate on behalf of the applicant in all of the circumstances. Indeed, it was due to the respondent's own conduct that the applicant found itself in a dire financial situation. The respondent cannot then seek to benefit from that fact.
162. In relation to the calculation of the rental loss suffered for the purposes of making an order pursuant to s 36(1)(c) of the BSCRA Act, the Tribunal notes that the Advali report only calculated the loss until 27 March 2018. It appears that it did so on the erroneous assumption that the building service undertaken at the existing property was part of the works contained in the relevant HBWCs. This Tribunal has found that this is not the case; see [85]-[86] above. On that basis the loss was not concluded as at the time that the relevant HBWCs were terminated by the applicant, but has been continuing up until the date of this decision.
163. Thus the applicant is potentially entitled to claim compensation for loss of rent from the date of 14 September 2016 until 14 October 2019. However, in the Tribunal's view the period ought to be discounted on the basis that there would likely have been periods of time when the room was not rented. It is unreasonable, in the Tribunal's view, to assume 100% occupancy over a three year period. On balance, in our view, an occupancy rate of 75% is reasonable to adopt. On this basis the applicant is to be compensated for a period of 118 weeks at a rental income of $190 per week which amounts to $22,420.
164. The Tribunal is therefore satisfied, for the reasons given, pursuant to s 38(1)(a) of the BSCRA Act that a building remedy order should be made pursuant to s 36(1)(c) of the BSCRA Act in favour of the applicant in the amount of $22,420. As mentioned previously, it was unnecessary to duplicate this complaint across each proceeding and therefore an order will be made in respect of complaint item 2 in proceeding CC 754/2019 only whilst dismissing the complaint which has been duplicated in the other two proceedings.

HBWC complaints ­ various breaches of the home building works contracts

165. The applicant also brought a number of HBWC complaints against the respondent alleging that it had breached each of the relevant HBWCs and seeking an order for compensation.
166. In respect to each complaint item the Tribunal therefore needs to identify whether the HBWC has been breached in the manner contended, and if so, what amount of damages ought to be awarded to the applicant which would be reasonably incurred in order to place the applicant in the same situation as if the contract had been performed by the respondent; see [91] above.
167. The Tribunal can, if satisfied that a HBWC remedy order is justified (s 43(1)(a) of the BSCRA Act) make one or more of the orders as set out in s 41(2) of the BSCRA Act. In circumstances such as the present case, where each HBWC has been terminated and contractual obligations are therefore no longer on foot, it is appropriate if the Tribunal finds a breach of contract, to make an order pursuant to s 41(2)(d)(i) of the BSCRA Act requiring the respondent to pay specified compensation for the loss or damage caused by the relevant breach of contract. Such loss or damage is usually calculated by reference to the costs which will be incurred by the applicant in remedying the breach of contract.
168. The Tribunal will proceed to address each individual breach of contract complaint below.

Costs for supply and installation of new locks and keys

169. Following termination of the HBWCs on 27 March 2018, the applicant proceeded to incur costs in respect of the supply and installation of new locks and keys to all three units in the amount of $477; page 213 of Exhibit 2 and page 364 of Exhibit 8.
170. The respondent submitted to the Tribunal that the applicant ought not to be awarded those costs on the basis that they do not flow from any alleged breach by the respondent and were unnecessarily incurred by the applicant. The respondent submitted to the Tribunal that if the applicant had requested the keys from the respondent that they would have been produced following the termination of the HBWCs on 27 March 2018. The applicant never requested provision of the keys and simply changed the locks two days following termination of the HBWCs.
171. The Tribunal accepts the respondent's contention that this cost was incurred by the applicant due to its own actions and not as a result of any breach by the respondent. Even assuming that the applicant's termination of the HBWCs was lawful, the Tribunal does not accept that this is a loss that necessarily and naturally flows from taking that course of action such that it is a cost that ought to be borne by the respondent. The Tribunal also accepts the respondent's submission that the applicant did not take reasonable steps to mitigate this loss through requesting the provision of the keys from the respondent. Therefore complaint item 15 in each proceeding is unsuccessful and will be dismissed.

Costs for supply and installation of clothes lines

172. The respondent admitted breach of the HBWCs in respect of the failure to supply and install clothes lines to each of the three units. The respondent submitted to the Tribunal that due to the high frequency of theft of items in the Gosnells area, the respondent was not willing to install such items until the final progress payments had been made by the applicant and possession taken.
173. However, the Tribunal notes that the HBWCs did not reflect this position and that once the final progress payment had been claimed by the respondent it was on the basis that each contract had been performed. The respondent was therefore clearly in breach by its failure to supply and install the clothes lines; pages 370, 418 and 470 of Exhibit 2.
174. The applicant claims the amount of $388 per unit comprising the cost of the clothes line, in the amount of $159 plus the cost of installation of $229; pages 243 and 244 of Exhibit 2. The respondent submitted to the Tribunal that the clothes lines contemplated by the HBWCs was the Daytek single fold down clothes line from Bunnings Warehouse at a price of $120; page 283 of Exhibit 2. Mr Buckley estimated that the cost to install the clothes line would be $60. Thus in the respondent's contention the amount of compensation required in order to place the applicant in the position it would have been in but for the breach is $180 per unit rather than $388.
175. The Tribunal is satisfied that the costings provided by the applicant accurately and reasonably reflect the costs that it will incur in remedying the breach. Whilst the cost of the clothes line relied upon by the applicant and the respondent differ, the difference in price in the Tribunal's view is minimal. The larger cost difference is the installation costs. However, the Tribunal notes that the respondent failed to provide evidence to the Tribunal of the third party costs that the applicant would incur in the installation and simply provided its own estimation. The Tribunal therefore only has the costings evidence for installation by a third party as presented by the applicant. The Tribunal finds that estimated cost to be reasonable.
176. The Tribunal therefore finds that the applicant will incur the amount of $388 in respect of the supply and installation of a clothes line in each of the three units and therefore is satisfied that it is justified that a HBWC remedy order be made pursuant to s 41(2)(d)(i) of the BSCRA Act in respect of complaint item 20 in each of CC 754, CC 755 and CC 756 of 2019 requiring the respondent to pay the applicant that specified amount.

Costs for supply and installation of termite barrier replacement system

177. The applicant alleges that the respondent breached each of the HBWCs by failing to install TermX Replenishment System as required; pages 360, 408 and 460 of Exhibit 1. In addition the respondent's building permit issued by the City of Gosnells on 13 November 2015 required the building work to be carried out in accordance with a number of conditions which included:

Termite treatment I.D.: Durable sticker to be installed to the inside of the meter box door specifying the method of protection provided against Termite infestation including, a) date of installation, b) the life expectancy of the chemical barrier as listed on the National Registration Authority label, c) the need to maintain and inspect the building on a regular basis, d) any other maintenance requirements.

(page 272 of Exhibit 2)

178. In respect of the absence of the termite replacement barrier the applicant relied on the oral evidence of Mr Wilkins and also on the inspection report prepared by Rite Build Group dated 8 June 2018 which noted the following:

There are no signs of termite treatment as required (no sticker in the meter box and an inlet for a replenishment irrigation system could not be found).

(page 66 of Exhibit 1)

179. Mr Wilkins reiterated the position with the Tribunal by confirming that there was a complete absence of visual evidence that the termite replenishment barrier had been installed, including the absence of any sticker in the meter box as required by the building permit; ts 12-14, 10 September 2019.
180. The respondent's position was that there had been no breach of contract. The respondent in particular relied upon a certificate of termite treatment issued on 26 July 2017 by Allpest in respect of the relevant property; page 281 of Exhibit 2. The respondent also contended that the sticker in the meter box could have been removed or simply come away.
181. The Tribunal is satisfied that the respondent has breached the contracts in the manner contended by the applicant. Each of the relevant HBWCs required a very specific termite treatment, being TermX Replenishment. The certificate relied upon by the respondent does not reflect the contractual requirement in this regard.
182. The Tribunal accepts the position of the applicant that if such a system was installed it would be self-evident on the basis that it is a replenishment system that is filled up from time to time and therefore piping or some other feature would be visibly evident. However, at the time of the inspection by Rite Build Group in 2018 there was simply no evidence of the replenishment system having been installed. Therefore on a balance of probabilities the Tribunal accepts that there has been a breach of the HBWCs.
183. The applicant provided to the Tribunal a quote to install the Term-X termite reticulation at a cost of $2,040 plus GST therefore totalling $2,244 in respect to all three units. The quote was provided by Perth Pest Control on 15 May 2019; page 225 of Exhibit 2. The Tribunal accepts the quantification provided by the applicant reflects the reasonable costs which it will now incur in order to place itself in the position it would have been in if the HBWCs had not been breached by the respondent.
184. The Tribunal therefore finds that the applicant will incur the amount of $2,244 and therefore is satisfied that it is justified that a HBWC remedy order be made pursuant to s 41(2)(d)(i) of the BSCRA Act in respect of complaint item 21 in each of CC 754, CC 755 and CC 756 of 2019 requiring the respondent to pay the applicant an equal third proportion of that amount, being $748.

Costs for removal of single bowls and replacement by double bowls

185. Each of the respective HBWCs required the kitchen to have a 'Clark Monaco Double Bowl Overmount' sink installed; pages 365, 413 and 465 of Exhibit 1. The respondent did not dispute that it had not installed a double bowl but instead had installed two single bowls; ts 15, 10 September 2019. Therefore in the Tribunal's view this constitutes a clear breach of the HBWCs. The applicant is therefore clearly entitled to what the HBWCs provided.
186. The applicant provided evidence to the Tribunal as to the cost of the 'Clark Monaco Double Bowl Overmount' sink in the amount of $832; page 232 of Exhibit 2. The applicant also obtained a quote from A2Z Plumbing Gas and Hot Water who estimated that to remove and replace the kitchen sinks would cost between $350 to $550; page 231 of Exhibit 2. Accepting the lower end of the cost of installation, in the amount of $350, together with the cost of the 'Clark Monaco Double Bowl Overmount' sink, the cost in respect of each unit to rectify this breach is $1,182. The respondent did not file any alternative costings evidence.
187. The Tribunal is satisfied that such a cost reasonably reflects what the applicant will incur to ensure that it receives what it is contractually required to be provided by the respondent.
188. The Tribunal therefore finds that the applicant will incur the amount of $1,182 in respect of the supply and installation of a 'Clark Monaco Double Bowl Overmount' sink in each of the three units and therefore is satisfied that it is justified that a HBWC remedy order be made pursuant to s 41(2)(d)(i) of the BSCRA Act in respect of complaint item 22 in each of CC 754, CC 755 and CC 756 of 2019 requiring the respondent to pay the applicant that specified amount.

Costs for supply and installation of mailboxes, bricked and rendered

189. It is not in dispute between the parties that the respondent breached the HBWCs by failing to provide mailboxes. What is in dispute between the parties is the type of mailboxes which the respondent was contractually required to provide.
190. The applicant contends that each of the HBWCs required the respondent to install a rendered brick mailbox; pages 360, 408 and 460 of Exhibit 1. During the course of the hearing Mr Buckley handed up a document entitled 'Addenda ­ Elemental Complete ­ Slate' dated 13 November 2015 which the Tribunal accepted as Exhibit 9. In respect of the mailbox that document provides 'builders standard'. Mr Buckley informed the Tribunal that the ‘builders standard' was the 'Northcote Pottery Charcoal Plymouth Pillar Letterbox' sold at Bunnings Warehouse for $148; page 289 of Exhibit 2.
191. The Tribunal does not accept the position submitted by the respondent. Firstly, if the respondent intended to vary the HBWCs by altering the requirement to provide brick and rendered mailboxes and to substitute them with a Bunnings Warehouse pottery mailbox, in the Tribunal's view such a substantive change required a written variation pursuant to clause 12 of each HBWC. No such variation was executed by the parties.
192. In the Tribunal's view, for the respondent to simply provide an updated addenda to the applicant on the premise that it reflected the current colour selections, and to purportedly insert a variation in ambiguous terms, is inappropriate and not in accordance with the provisions of the HBWCs and is therefore unenforceable.
193. The only costing before the Tribunal in respect of the construction of three bricked and rendered mailboxes was produced by the applicant in the form of a quote dated 15 May 2019 from Revell Landscaping in the amount of between $5,000 and $10,000; page 233 of Exhibit 2. Whilst the respondent disputed the reasonableness of the quote, it did not provide any alternative costing. The Tribunal accepts the lower end of the quote in the amount of $5,000 as a reasonable cost to construct the three mailboxes.
194. The Tribunal therefore finds that the applicant will incur the amount of $1, 666.67 in respect of the construction of a brick rendered mail box at each of the three units and therefore is satisfied that it is justified that a HBWC remedy order be made pursuant to s 41(2)(d)(i) of the BSCRA Act in respect of complaint item 23 in each of CC 754, CC 755 and CC 756 of 2019 requiring the respondent to pay the applicant that specified amount.

Compensation for stress and anxiety

195. The applicant had originally claimed compensation in the amount of $500,000 for stress and anxiety, due to the breach of contract by the respondent in failing to reach practical completion within the time specified within each of the HBWCs (complaint item 1 in each proceeding).
196. In summary, the applicant contended that stress and anxiety had been suffered by its Director, Mr Wilkins, through a relationship breakdown, loss of employment, and mental health issues allegedly arising as a result of the breach of contract by the respondent.
197. It was pointed out to Mr Wilkins during the course of the hearing by the Tribunal that claims for compensation for stress and anxiety are personal in nature and that it was Mr Wilkins himself who suffered a relationship breakdown and mental health issues, rather than the applicant. The applicant accepted this position and chose not to pursue or lead this evidence at the hearing; ts 206, 11 September 2019.

Remaining complaint items

198. The remaining complaint items not yet addressed by the Tribunal are numbered 4-9, 12, 17 and 19 in each of CC 754/2019, CC 755/2019 and CC 756/2019. They each seek to recover costs incurred by the applicant in the proceedings by way of expert costs and legal fees.
199. Parties have liberty to make an application for costs following a final determination by the Tribunal pursuant to s 49(1) of the BSCRA Act. It is therefore unnecessary and not appropriate for a claim for costs to be included as a complaint item or items at the time that an application is lodged with the Building Commissioner. These complaint items will therefore be dismissed in each proceeding and any costs application will be programmed separately by the Tribunal.

Orders

Proceedings CC 1436, CC 1438 and CC 1439 of 2017

The Tribunal makes the following order:

1. The Tribunal hereby dismisses the applicant's complaints made pursuant to  s 5(2)  of the  Building Services (Complaint Resolution and Administration) Act 2011  (WA) and  s 17  and s 15A of the Home Building Contracts Act 1991 (WA) alleging that the respondent engaged in misleading or deceptive conduct.

Proceeding CC 754 of 2019

The Tribunal makes the following orders:

1. Pursuant to  s 41(2)(d)(i)  of the  Building Services (Complaint Resolution and Administration) Act 2011  (WA) in respect of complaint items 1, 20, 21, 22 and 23, the respondent shall pay to the applicant the sum of $29, 659.67 within 21 days of the date of this order.
2. Pursuant to  s 36(1)(c)  of the  Building Services (Complaint Resolution and Administration) Act 2011  (WA) in respect of complaint item 2, the respondent shall pay to the applicant the sum of $22, 420 within 21 days of the date of this order.
3. Pursuant to s 36(1)(b) of the  Building Services (Complaint Resolution and Administration) Act 2011  (WA) in respect of complaint items 10 and 11, the respondent shall pay to the applicant the sum of $26, 505.00 within 21 days of the date of this order.
4. The following complaint items are hereby dismissed: 4­9, 12, 15, 17, 18 and 19.
5. The matter of costs applications is listed to a directions hearing at 11.00 am on 5 November 2019.

Proceeding CC 755 of 2019

The Tribunal makes the following orders:

1. Pursuant to  s 41(2)(d)(i)  of the  Building Services (Complaint Resolution and Administration) Act 2011  (WA) in respect of complaint items 1, 20, 21, 22 and 23, the respondent shall pay to the applicant the sum of $27, 605.67 within 21 days of the date of this order.
2. The following complaint items are hereby dismissed: 2, 4-11, 12, 15, 17, 18 and 19.
3. The matter of costs applications is listed to a directions hearing at 11.00 am on 5 November 2019.

Proceeding CC 756 of 2019

The Tribunal makes the following orders:

1. Pursuant to  s 41(2)(d)(i)  of the  Building Services (Complaint Resolution and Administration) Act 2011  (WA) in respect of complaint items 1, 20, 21, 22 and 23, the respondent shall pay to the applicant the sum of $27,605.67 within 21 days of the date of this order.
2. The following complaint items are hereby dismissed: 2, 4-11, 12, 15, 17, 18 and 19.
3. The matter of costs applications is listed to a directions hearing at 11.00 am on 5 November 2019.

I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.

MS C WALLACE, SENIOR MEMBER

15 OCTOBER 2019

JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL

ACT :  BUILDING SERVICES (COMPLAINT RESOLUTION AND ADMINISTRATION) ACT 2011  (WA)

CITATION : HIPPYDAYZE PTY LTD and MENER GROUP PTY LTD [2019] WASAT 92 (S)

MEMBER : MS C WALLACE, SENIOR MEMBER

HEARD : DETERMINED ON THE DOCUMENTS

DELIVERED : 27 NOVEMBER 2019

FILE NO/S : CC 754 of 2019

CC 755 of 2019

CC 756 of 2019

BETWEEN : HIPPYDAYZE PTY LTD

Applicant

AND

MENER GROUP PTY LTD

Respondent

Costs - Building dispute - Exercise of discretion - Parties to act in accordance with Tribunal's statutory objectives - Respondent failed to act in a way so as to minimise costs to parties

Legislation:

 Building Services (Complaint Resolution and Administration) Act 2011  (WA),  s 11(1)(d) ,  s 49(1) 
State Administrative Tribunal Act 2004 (WA), s 9, s 87, s 87(1)

Result:

Partly successful

Category: B

Representation:

Counsel:

Solicitors:

Case(s) referred to in decision(s):

Chew and Director General of the Department of Education and Training [2006] WASAT 248

Gileno and Rivera Homes (WA) Pty Ltd [2018] WASAT 48 (S)

Hippydayze Pty Ltd and Mener Group Pty Ltd [2019] WASAT 92

Marvelle Investments Pty Ltd and Argyle Holdings Pty Ltd [2010] WASAT 125 (S)

Mener Group Pty Ltd and Hippydayze Pty Ltd [2019] WASAT 37

Perth Central Holdings Pty Ltd and Doric Constructions Pty Ltd [No 2] [2008] WASAT 302

Western Australian Planning Commission v Questdale Holdings Pty Ltd [2016] WASCA 32

REASONS FOR DECISION OF THE TRIBUNAL:

The proceeding and application for costs

200. The applicant, Hippydayze Pty Ltd, brought a number of complaints against the respondent, Mener Group Pty Ltd, which were lodged with the Building Commissioner and then referred to the Tribunal pursuant to  s 11(1)(d)  of the  Building Services (Complaint Resolution and Administration) Act 2011  (WA) (the BSCRA Act). The complaints related to three home building work contracts entered into between the applicant and respondent to construct three units in the suburb of Gosnells in the State of Western Australia.
201. The complaints were heard by the Tribunal during 10 and 11 September 2019, together with related proceedings, and the Tribunal published its reasons on 15 October 2019; Hippydayze Pty Ltd and Mener Group Pty Ltd [2019] WASAT 92 (Hippydayze). The applicant was substantively successful in the majority of its claims which resulted in orders being made in its favour totalling $133,796. The only noteworthy claim which was unsuccessful was the applicant's claim for compensation for anxiety and stress suffered, which was ultimately not pressed by the applicant at the final hearing; Hippydayze at [197].
202. The applicant made an oral application seeking costs on 12 November 2019 pursuant to s 49(1) of the BSCRA Act. The applicant sought the following costs (page 292 of Exhibit 1):
     • $65,000 by way of legal fees incurred;
     • expert fees in the amount of $13,638; and
     • costs incurred in respect of filing fees in the amount of $636.

Legal principles

203. Costs applications made under the State Administrative Tribunal Act 2004 (WA) (SAT Act) pursuant to s 87(1) start from the position that parties bear their own costs in a proceeding. However, that provision does not apply where the enabling Act provides otherwise.
204. Section 49(1) of the BSCRA Act confers a broad discretion on the Tribunal to award costs of a proceeding and relevantly provides as follows:

Subject to this section, the Building Commissioner or the State Administrative Tribunal may make such orders for costs as they think fit in relation to proceedings arising from a building service complaint or a HBWC complaint.

205. The interrelationship between the costs provisions in the SAT Act and in the BSCRA Act was considered by the Tribunal in Gileno and Rivera Homes (WA) Pty Ltd [2018] WASAT 48 (S) at [13]- [16]:
     13. Section 87(1) of the SAT Act provides that each party bear their own costs unless the Tribunal orders otherwise. However, relevant to these proceedings, the principle in s 87(1) of the SAT Act commences with the proviso, unless specified in the enabling Act. The enabling Act in these proceedings is the BS(CRA) Act which has a specific provision allowing for a costs application.
     14. Relevant to these proceedings, s 49(1) of the BS(CRA) Act provides that the Tribunal may make such orders for costs as the Tribunal thinks fit arising from a building service complaint. This is a broad discretion to award costs conferred on the Tribunal. Section 49(7) of the BS(CRA) Act provides that s 49 does not limit the powers of the Tribunal under Pt 4 Div 5 of the SAT Act, the part of the SAT Act which provides for costs applications.
     15. The legal principles applicable to costs applications in the Tribunal in matters determined under the BS(CRA) Act and the SAT Act have been considered in a number of published decisions of the Tribunal. In particular we refer, and respectfully follow with one exception to be identified shortly, the principles enunciated in the decisions of the Tribunal in the following decisions: Wright and 3B Build Pty Ltd [2016] WASAT 68 at [7]­[10]; WA Country Builders Pty Ltd and Hathersage Nominees Pty Ltd [2016] WASAT 70 at [10]- [15]; Sanders and Gemmill Homes [2017] WASAT 41 (S) at [8]- [9].
     16. The one exception where we respectfully do not follow those Tribunal costs decisions identified above, is in relation to the use of the phrase 'neutral in effect' as to the operation of s 49 of the BS(CRA) Act. That phrase was coined by the Tribunal in Hoskins and Daniel Vinci t/as D'Vinci Contracting [2011] WASAT 188 at [19]. In our view, s 49(1) is not 'neutral in effect'. To conclude that a provision is 'neutral in effect', in our view, does not accord with ordinary principles of statutory interpretation. In our view, s 49 of the BS(CRA) Act operates so as to create a broad discretion as to costs in these type of proceedings, that is, the discretion is not limited to the starting position that each party bear their own costs as stated in s 87(1) of the SAT Act (and this principle is stated in those Tribunal decisions). Section 49 of the BS(CRA) Act operates so as not to limit the application of s 87 of the SAT Act, however the converse cannot be said in that s 87(1) of the SAT Act cannot operate so as to limit the operation of the broad discretion found in s 49(1) of the BS(CRA) Act. This interpretation is consistent with the proviso in s 87(1) as well as s 5 of the SAT Act which provides that the enabling Act prevails. However, having made that observation, we otherwise agree with, and respectfully follow, the principles identified in those Tribunal decisions as a guide in the exercise of the Tribunal's discretion to award costs under s 49 of the BS(CRA) Act and s 87 of the SAT Act.
206. I agree with the comments of the Tribunal set out above and the conclusion reached and respectfully adopt it.
207. In substance, s 49(1) of the BSCRA Act, by conferring a broad unrestricted discretion on the Tribunal to award costs, appears to constitute a departure from s 87(1) of the SAT Act. Thus in considering a claim for costs made pursuant to s 49(1) of the BSCRA Act, the Tribunal is not required to start from the position that each party is to bear its own costs.
208. However, as is well understood, costs do not 'follow the event' at the Tribunal and the broad discretion conferred on the Tribunal is be properly exercised by taking into account relevant considerations.
209. Some of the factors relevant in exercising the discretion to award costs pursuant to s 87 of the SAT Act are equally relevant in the exercise of the discretion pursuant to s 49(1) of the BSCRA Act and were usefully identified in Chew and Director General of the Department of Education and Training [2006] WASAT 248 at [85]:

We take the view that in proceedings under the Act, the Tribunal should not generally make an award for costs unless a party has conducted itself in such a way as to unnecessarily prolong the hearing; has acted unreasonably or inappropriately in its conduct of the proceedings, has been capricious; or the proceedings in some other way constitute an abuse of process. The Tribunal might also make an order as to costs where a matter has been brought vexatiously or for improper purposes.

210. Further guidance was given to the Tribunal in relation to the exercise of its discretion to award costs by the Court of Appeal in Western Australian Planning Commission v Questdale Holdings Pty Ltd [2016] WASCA 32 (Questdale) in which the following principles were found to apply:

(1) The discretionary power is to be exercised judicially; that is not arbitrarily, capriciously or so as to frustrate the legislative intent; Questdale per Murphy JA (with whom Martin CJ and Corboy J agreed) at [48];

(2) The power to award costs is to be exercised if it is fair and reasonable in all the circumstances of the case to do so; Questdale per Murphy JA (with whom Martin CJ and Corboy J agreed) at [49];

(3) The onus is on the party seeking an order in its favour to establish that a favourable order ought to be made; Questdale per Murphy JA (with whom Martin CJ and Corboy J agreed) at [51];

(4) Every party to proceedings before the Tribunal is taken to be cognisant of the objectives of the Tribunal as expressly provided for in s 9 of the SAT Act. It is therefore necessary for the applicant to establish that the respondent's conduct has impaired the attainment of the Tribunal's objectives to have the proceedings determined fairly and in accordance with the substantial merits, with as little formality and technicality as possible and in a way which minimises the costs to the parties; Questdale per Murphy JA (with whom Martin CJ and Corboy J agreed) at [54]; and

(5) The mere fact that a party ultimately fails on a contention advanced during the course of the hearing does not, in itself, signify that the party has acted inconsistently with the objectives set out in s 9 of the SAT Act; Questdale per Murphy JA (with whom Martin CJ and Corboy J agreed) at [55].

211. If the Tribunal exercises its discretion to award costs in favour of the applicant, it is to approach the task of fixing costs in a broad and relatively robust fashion; Perth Central Holdings Pty Ltd and Doric Constructions Pty Ltd [No 2] [2008] WASAT 302 at [67] and Marvelle Investments Pty Ltd and Argyle Holdings Pty Ltd [2010] WASAT 125 (S) at [49]. The Tribunal does not necessarily tax or assess costs in the way that courts ordinarily do. However, although fixing costs involves a relatively broad brush approach, the Tribunal must nevertheless be satisfied that the costs claimed are reasonable and not excessive in nature.

The applicant's submissions

212. In summary, the applicant submits that it is entitled to costs on the following basis:

(a) The parties have been involved in multiple proceedings which have taken a number of years to reach final determination;

(b) The respondent took no steps to reduce the costs incurred or the length of the proceedings, for example, by failing to concede complaints where there was no proper defence available. Rather, the respondent put the applicant to proof in respect of every complaint;

(c) The applicant brought a multitude of complaints against the respondent and was largely successful;

(d) The respondent's sole director was dishonest in his evidence before the Tribunal and attempted to mislead the Tribunal; and

(e) If the respondent had acted reasonably and in good faith, it would not have been necessary to incur the large quantum of costs incurred in the proceedings.

The respondent's submissions

213. In summary, the respondent made the following submissions to the Tribunal in opposition to the applicant's application for costs:

(a) The respondent met all of its obligations in the proceedings and did not delay by filing late or not complying with the Tribunal's orders;

(b) The respondent attempted to resolve the proceedings with the applicant and it was the applicant's choice to proceed by refusing the respondent's offers to resolve the dispute on a 'walk away' basis;

(c) Some of the delay in the related proceedings was due to the conduct of the applicant in failing to file documents in accordance with the Tribunal's orders and a failure to attend a mediation which resulted in the parties incurring increased costs; and

(d) The respondent was entitled to defend itself and refute the allegations made by the applicant in the proceedings.

Consideration

214. It should be noted that the applicant is seeking to recover costs, some of which were incurred in proceedings CC 708, 709 and 710 of 2018, and proceedings CC 1436, 1438 and 1439 of 2017, through its application for costs in these proceedings. That is, the applicant has sought recovery of costs incurred by it in all of its related proceedings before the Tribunal.
215. The Tribunal is unable to allow such a broad application to be made. This is because those related proceedings (with the exception of one complaint which was dismissed by this Tribunal) were presided on by the Tribunal differently constituted and no costs application was made by the applicant in those proceedings except in relation to one complaint item (which resulted in a costs order being made in favour of the applicant in the amount of $493.57 on 26 March 2019).
216. The Tribunal understands that from the parties' perspective litigation which may comprise of different allegations or complaints filed at different points in time, nevertheless constitutes one entire dispute arising between them. However, from a jurisdictional perspective, the relevant proceedings were separate and have been mediated and/or determined with final orders being made by the Tribunal differently constituted. If the applicant wished to make an application for costs in those separate proceedings, then it was required to make it to the Tribunal as relevantly constituted. This Tribunal simply has no jurisdiction to consider an application for costs made outside of proceedings CC 754 - 756 of 2019.
217. In addition, and as a separate matter, the Tribunal notes that a costs order in respect of legal costs has already been made in favour of the applicant in the amount of $21,000; Mener Group Pty Ltd and Hippydayze Pty Ltd [2019] WASAT 37. That costs order has not been reflected in the report prepared by Mr Watson of Advali Accountants (pages 289­293 of Exhibit 1) but ought to have been so as to avoid making an inflated costs claim. Once that order has been taken into consideration, it necessarily reduces the legal costs claimed by the applicant in this proceeding, to the amount of $44,000.
218. In the Tribunal's view it is persuaded that it is appropriate for the respondent to be ordered to pay a proportion of the applicant's costs incurred in the proceeding for the following reasons:

(a) There was legal complexity in a number of the complaints raised by the applicant which required it to seek legal advice and representation;

(b) The applicant was almost entirely successful as against the respondent and many of the complaints were clearly meritorious and ought to have been conceded by the respondent but were not;

(c) The respondent did not act in a manner which was cognisant of the s 9 SAT Act objectives given that it did not conduct itself in a way which minimised the costs to the parties. By strongly refuting every complaint item, in a number of instances without a proper foundation and in the absence of corroborating lay or expert evidence, the respondent forced the applicant to incur both legal and expert costs in pursuing those complaints;

(d) Any offers to settle made by the respondent were not reasonable given the ultimate orders made by the Tribunal in the applicant's favour; and

(e) The respondent's director gave evidence to the Tribunal which was found to lack credibility; Hippydayze at [107].

219. In relation to the legal costs incurred by the applicant, as already noted above, a large portion of those costs would have been incurred in proceedings CC 708 - 710 of 2018 and are not capable of being claimed in this proceeding. In addition, some of the costs must have also been incurred in proceedings CC 1436, 1438 and 1439 of 2017, part of which was dismissed by this Tribunal; Hippydayze at [88].
220. Therefore, whilst the Tribunal has considered the costs incurred and found them to be reasonable and not excessive (as set out in Exhibit 8) the Tribunal is unable to make a costs order allowing substantive recovery of those costs. However, the Tribunal considers that, in undertaking a broad brush robust approach, an order requiring the respondent to pay the applicant the amount of $15,000 by way of legal fees is appropriate in exercising its discretion.
221. In relation to the expert fees sought by the applicant, the Tribunal is of the view that the following expert reports assisted the Tribunal in reaching its determination and ought to be recoverable by the applicant:

(a) GF Consulting Engineers report, $550;

(b) Ritebuild Group invoices, $242; and

(c) Advali Accountants invoices, $1,279.

222. The Tribunal will not award the remaining expert costs claimed by the applicant on the basis that the Tribunal did not rely on that expert evidence and it was primarily incurred in the related proceedings by the applicant. The Tribunal will also not award the cost of filing fees to the applicant on the basis that they are an ordinary and necessary cost incurred by applicants in litigation and are generally not recoverable.

Order

1. Pursuant to  s 49  (1) of the  Building Services (Complaint Resolution and Administration) Act 2011  (WA) the respondent shall pay to the applicant, within 7 days of the date of this order, the amount of $17,071.

I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.

MS C WALLACE, SENIOR MEMBER

27 NOVEMBER 2019