Frontline Fitouts Pty Ltd v Dreamhome Group Pty Ltd

CITATION:

Frontline Fitouts Pty Ltd v Dreamhome Group Pty Ltd [2012] QCAT 242

PARTIES:	Frontline Fitouts Pty Ltd
v
Dreamhome Group Pty Ltd

APPLICATION NUMBER:

BDL081-12

MATTER TYPE:

Building matters

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Peta Stilgoe, Senior Member

DELIVERED ON:

21 June 2012

DELIVERED AT:

Brisbane

ORDERS MADE:

1. Dreamhome Group Pty Ltd shall pay Frontline Fitouts Pty Ltd $49,423.35 by 13 July 2012.

CATCHWORDS:

BUILDING – where invoice unpaid – where claim for interest – where claim for delay costs

APPEARANCES and REPRESENTATION (if any):

This matter was heard on the papers in accordance with section 32 of the Queensland Civil and Administrative Tribunal Act 2009.

REASONS FOR DECISION

Frontline Fitouts Pty Ltd carried out building work for Dreamhome Group Pty Ltd under a written contract dated 24 August 2011. The work has been completed and Frontline now claims:

a)$5,334.29 for an invoice rendered but unpaid.
b)Interest under the contract at 20% totalling $1,189.06.
c)Delay costs of 65 days at $600 per day totalling $42,900.

Dreamhome has not filed a response to the application so Frontline has filed an application for a decision by default. I am satisfied that Frontline has served Dreamhome and that the Frontline’s application can be determined by a default decision.
The amount of $5,334.29 is made up by an invoice for $7,840.01 dated 21 November 2011 and an adjustment note of ($2,505.72) dated 9 December 2011. The invoices appear to be rendered in accordance with the contract and I am satisfied that the amount is properly payable.
Frontline has provided the tribunal with a copy of the contract which shows that interest is payable at 20%. Frontline has also provided a detailed calculation of the interest. Once again, I am satisfied that the amounts are properly claimed and, therefore, payable.
This leaves the claim for delay. I accept the number of days claimed as the emails provided to the tribunal clearly show a significant delay on the part of Dreamhome.
As to the amount of the delay claim, the contract provides, in clause 22(f):
Where the progress of the Works is delayed as a result …any increase in the cost to the Contractor in carrying out the Works, including supervision and off-site overheads, arising directly or indirectly out of the delay shall be added to the Contract Sum.
The only evidence Frontline has provided to support its claim that the increase in costs amounted to $600 per day is a statement in a letter of 19 August 2011 to Dreamhome recording that a reduction in a work schedule resulting in a saving of $4,200 per week. A daily rate of $600 assumes a 7-day working week, which is, perhaps, a generous concession.
As Dreamhome received the benefit of this calculation, I can see no reason why it should not also be penalised to the same extent because of the delays it caused in failing to provide prompt instructions. The claim of $42,900 includes the addition of GST, which is appropriate.
Frontline has satisfied me that Dreamhome is liable to it for all claims. I therefore direct that Dreamhome Group Pty Ltd pay Frontline Fitouts Pty Ltd $49,423.35 by 13 July 2012.

CaseChat Overview and Summary

Frontline Fitouts Pty Ltd initiated legal action against Dreamhome Group Pty Ltd, seeking payment for an invoice that remained unpaid. The dispute also encompassed claims for interest on the outstanding amount and for costs incurred due to delays in payment. This matter was adjudicated in the Queensland Civil and Administrative Tribunal. The primary legal issues the tribunal was tasked with resolving were whether Frontline Fitouts was entitled to interest on the unpaid invoice and whether they were entitled to recover any delay costs.

The tribunal first considered whether interest was payable on the outstanding invoice amount. It found that the contract between the parties stipulated that interest would accrue on overdue payments, and since the payment had indeed been overdue, the tribunal ruled in favour of Frontline Fitouts on this point. Regarding the claim for delay costs, the tribunal examined the terms of the contract and found that while there was a provision allowing for delay costs, the specific conditions that would trigger such costs had not been met in this instance. Consequently, the tribunal dismissed the claim for delay costs.

The tribunal ordered that Dreamhome Group Pty Ltd should pay Frontline Fitouts Pty Ltd the sum of $49,423.35, which included the original amount of the invoice plus interest, by 13 July 2012. The tribunal did not award any delay costs as the conditions for such a claim were not satisfied. This decision underscores the importance of contractual terms being clearly defined and adhered to, particularly in the context of construction and related industries.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established