Jones v Rutch Constructions Pty Ltd No 2

[2022] QCAT 213

QUEENSLAND CIVIL AND
ADMINISTRATIVE TRIBUNAL

CITATION:

Jones and Anor v Rutch Constructions Pty Ltd  No 2 [2022] QCAT 213

PARTIES:

ERIC JONES AND LORRAINE ANN JOHNSTON

(applicant)

v

RUTCH CONSTRUCTIONS PTY LIMITED

(respondent)

APPLICATION NO/S:

BDL256-19

MATTER TYPE:

Building matters

DELIVERED ON:

8 June 2022

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Member King-Scott

ORDERS:

The Tribunal orders:

The Respondent pay the Applicants’ costs of and incidental to the application on the District Court scale on a standard basis and failing agreement;

(a)     The Applicants must file in the Tribunal and give to the Respondent a short form assessment of costs prepared by an approved Costs Assessor together with any submissions in support of the costs sought to be paid by 15 July 2022;

(b)     If within 14 days of the receipt of the assessment by the Respondent the parties have not agreed costs, the costs should be assessed by Hickey and Garrett, Legal Costs Assessors, level 15, 141 Queen Street Brisbane 4000;

(c)     The Respondent to pay the Cost Assessors costs of the assessment.

CATCHWORDS:

COSTS – Calderbank offer – where offer to settle not more favourable – where costs ordered on a standard basis

Queensland Building and Construction Commission Act 1991

Queensland Civil and Administrative Tribunal Act 2009

Lyons v Dreamstarter Pty Ltd [2012] QCATA 71

APPEARANCES & REPRESENTATION:

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld)

REASONS FOR DECISION

1. This matter was heard at Caloundra over 2 days in December 2021. On 3 March 2022 the following orders were made:

   The respondent pay the applicants the sum of $162,370.27 in respect of their claim by 4:00 pm 31 March 2022;

2. The parties were invited to make written submissions on costs.

3. The Tribunal has powers to award costs pursuant to s77(3) of the Queensland Building and Construction Commission Act 1991 displacing the usual no costs provision in Tribunal matters as provided by s100 of the Queensland Civil and Administrative Tribunal Act 2009 (“QCAT Act”).

4. Where there is a discretion to award costs the usual rule is that costs follow the event.

5. Under s102 of the QCAT Act relevantly provides:

   (1) The tribunal may make an order requiring a party to a proceeding to pay all or a stated part of the costs of another party to the proceeding if the tribunal considers the interests of justice require it to make the order.

   ...

   (3) In deciding whether to award costs under subsection (1) or (2) the tribunal may have regard to the following—

   (a) whether a party to a proceeding is acting in a way that unnecessarily disadvantages another party to the proceeding, including as mentioned in section 48(1)(a) to (g)[1];

   (b) the nature and complexity of the dispute the subject of the proceeding;

   (c) the relative strengths of the claims made by each of the parties to the proceeding;

   (d) ...

   (e) the financial circumstances of the parties to the proceeding.

   (f)`anything else the tribunal considers relevant.

   [1]None of these conditions apply in this case.

6. The Applicants have been totally successful in their claim.

7. Prior to the filing of the Application, the Applicants made an offer to settle the matter, which was reduced to writing, The offer was refused.

8. The proposed offer was contained in a letter dated 13 June 2019 and expired on 30 June 2019. In part it read as follows:

   … a financial statement in which Rutch would pay the costs of rectification in Schedule 2 annexed to this letter in discharge of its obligations under the statutory warranties in the building contract.

   The scope of works to rectify the defects is set out in Schedule 2.

   Each item has been separately costed accordingly to Cordell’s Cost Guide.

   The total calculated costs to rectify the defects, taking into account auxiliary costs is $161,616.23 (incl GST).

   However, that figure is subject to the suspended slab rebates and steel columns requiring concrete x-ray and cover metre testing to determine whether the required cover has been achieved and consequently whether the rectification work is required.

   The figure $161,616.23 includes costs of that testing but not the costs of any rectification work that may be required as a result of the testing.

9. The Applicants argue that the offer was made very early in the proceeding and, therefore, arguably was more favourable than the final decision. Further, it was submitted that the resistance offered by the Respondent at the hearing was superficial and warrants an order for costs on an indemnity basis.

10. However, the offer was conditional. The offer leaves open the cost of additional rectification work and that is unknown. In the circumstances, I agree with the Respondent’s submissions that it was not possible to quantify with any degree of precisions what was being offered by the Applicants. Although the monetary sum offered was very slightly more favourable to the Respondent than the ultimate result the uncertainty of the additional rectification work did not make the offer more favourable.

11. I do not accept that the Respondent’s defence to the claim was superficial. It was complex with competing expert opinions as to the builder’s liability.

12. Therefore, costs should be assessed on a standard basis and as the amount claimed and recovered falls beyond the monetary jurisdiction of the Magistrates Court it should be assessed on the District Court scale.

13. The Tribunal should endeavour, where possible, to fix costs.[2] However, in this case I am not confident that I could fix costs on the material available. The Tribunal can make an order requiring that the costs be assessed by reference to a scale under the rules applying to a court.[3]

    [2]See s.107 of the QCAT Act.

    [3]See s.107 (2) and (3) of the QCAT Act

14. The order of the Tribunal will be that the Respondent pay the Applicants’ costs of and incidental to the application on a standard basis to be agreed or assessed on the District Court scale.

15. I make the following orders should the parties not be able to agree on the amount of the costs.

    (a)The Respondent pay the Applicants’ costs of and incidental to the application on the District Court scale on a standard basis and failing agreement;

    (i)      The Applicants must file in the Tribunal and give to the Respondent a short form assessment of costs prepared by an approved Costs Assessor together with any submissions in support of the costs sought to be paid by 7 July 2022;

    (ii)      If within 14 days of the receipt of the assessment by the Respondent the parties have not agreed costs, the costs should be assessed by Hickey and Garrett, Legal Costs Assessors, level 15, 141 Queen Street Brisbane 4000;

    (iii)     The Respondent to pay the Cost Assessors costs of the assessment.

    (b)The Respondent shall pay to the Applicants the assessed costs within 14 days of receipt of the assessment.