Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Long v Stair Lock Pty Ltd [2021] NSWCATCD 24 Hearing dates: 11 June 2021 Date of orders: 22 June 2021 Decision date: 22 June 2021 Jurisdiction: Consumer and Commercial Division Before: S McDonald, Senior Member Decision: The Tribunal orders that: (1) Pursuant to s.48MA of the Home Building Act 1989 (NSW), the Respondent is to supply and install a replacement American Oak post to the staircase delivered and installed at the Applicant's residence within 28 days of today's date, such post to be Oak Square and of no less than 1979mm length; (2) In the event that the Respondent fails to comply with Order 1 on or before 20 July 2021, the Applicant has leave to renew the application before the Tribunal; and, otherwise (3) The application is dismissed. Catchwords: BUILDING AND CONSTRUCTION — Home Building Act 1989 (NSW) — Statutory warranty — Supply and install — Breach of specification — Contractual remedies — Work order Legislation Cited: Home Building Act 1989 (NSW) Category: Principal judgment Parties: Margaret Long (Applicant) Stair Lock Pty Ltd (Respondent) File Number(s): HB 21/03827 Publication restriction: Nil Reasons for decision Introduction 1. This is a home building application brought by Margaret Long (Applicant) of a property in East Lindfield (Residence) in respect of a contract to supply and install a staircase to her attic at the Residence (Contract). The Contract was with Stair Lock Pty Limited ACN 611 507 254 (Respondent), a company which has its principal place of business at Elizabeth South, South Australia, 5112. 2. The Applicant alleges that the supply and installation of the staircase was undertaken by the Respondent in breach of s.18B of the Home Building Act 1989 (NSW) (HBA) in that: 1. The work was not undertaken with due care and skill; 2. The work was not in accordance with the plans and specifications set out in the Contract; 3. That the materials used in doing the work were not fit for the specified purpose and/or were not as specified by the Applicant in the contract. Background 1. The background and issues are relatively straightforward. In about June 2020 the Applicant invited several contractors to quote for the provision of a staircase to her attic. 2. At the Applicant's request, the Respondent provided three quotations. They are quotation QTE034283-1 dated 3/6/2020 (first quote), quotation QTE034283-2 dated 4/6/2020 (second quote) and quotation 3 QTE034283-3 dated 5/6/2020 (third quote). 3. The first quote was in the sum of $4,939.00 including GST and contained the following elements: 1. The description of the staircase that the Respondent was to provide was "A/Oak Stair (MDF Stringers) Only & Pine Balustrade"; 2. The specification provided for: 1. Balustrade allowed to inside of stair flight only; 2. 90mm x 90mm square pine posts, 65 x42mm rectangular pine handrail & 32 x 32 mm MDF stringers; 3. 28 mm American Oak Overlay Treads, 18 mm Oak Veneered Risers & 32 mm MDF Stringers; 4. American Oak Overlay Treads have a MDF core then is fully encased with a 4 mm Oak overlay; 5. No allowance for any painting, staining, polishing, carpeting, non-slip nosings, linings to underside of stair or walls; 6. Wall rails allowed to outside of stairs flights only; and 7. No allowance for any balustrade or wall rail, by others". 1. The second quote was in the sum of $4,378.00 including GST and contained the following elements: 1. The description of the staircase that the Respondent was to provide was "A/Oak Stair (MDF Stringers) Only & Pine Balustrade"; 2. The specification provided for: 1. Requoted to change to oval handrails 2. Balustrade allowed to inside of stair flight only 3. 90mm x 90mm square pine posts, 65 x42mm rectangular pine handrail & 32 x 32 mm pine square balusters; 4. 28 mm American Oak Overlay Treads, 18 mm Oak Veneered Risers & 32 mm MDF Stringers; 5. American Oak overlay Treads have a MDF core then is fully encased with a 4 mm Oak overlay; 6. No allowance for any painting, staining, polishing, carpeting, non-slip nosings, linings to underside of stair or walls; and 7. Wall rails allowed to outside of stairs flights only. 1. The third quote was in the sum of $$3,553.00 including GST and contained the following elements: 1. The description of the staircase that the Respondent was to provide was "A/Oak Stair (MDF Stringers) Only"; 2. The specification provided: 1. 28 mm American Oak Overlay Treads, 18 mm Oak Veneered Risers & 32 mm MDF Stringers; 2. American Oak Overlay Treads have a MDF core then is fully encased with a 4 mm Oak overlay; 3. No allowance for any painting, staining, polishing, carpeting, non-slip nosings, linings to underside of stair or walls; and 4. No allowance for any balustrade or wall rail, by others". 1. MDF is an acronym for medium-density fibreboard. MDF is an engineered wood product made by breaking down hardwood or softwood residuals into wood fibres, combining it with wax and a resin binder, and forming it into sheets or panels by applying high temperature and pressure. It is a cheap alternative to natural timber and can be covered with timber veneer to give a similar appearance as natural timber at a lesser cost. 2. The three quotes show a diminishing cost to the Applicant on each occasion, arrived at first by removing the inside balustrade and quoting oval handrails, and then removing the pine balustrade and wall rails and by not including the elements in 6(2)(c) and (d) above. 3. The Respondent included the three quotes in its bundle of documents. The Applicant only included the third quote in her bundle of documents. The third quote was accepted and executed by the Applicant on 9 June 2020 at her residence and in the presence of Robyn Malzard, the Respondent's Area Sales NSW officer. 4. As a result, the Tribunal finds that the Respondent's offer was accepted in NSW and that the proper law of the contract is NSW law. It follows therefore that the Tribunal has jurisdiction to hear the Applicant's claim in the Tribunal and under the HBA. 5. The Applicant's copy of the third quote has added to it the following words "capping in pine" and "Michael to measure". 6. The following words were also added to the Applicant's copy of the third quote in handwriting namely the words "to be capped in pine" after the words in 7(2)(a) above and the words "no, not painting" after the words in 7(2)(c) above. The Applicant apparently intended to have the staircase stained (but not by the Respondent) to obtain a look not dissimilar to that in the top right photograph of A28. 7. For reasons which the Tribunal will come to, the absence of these words in the Respondent's copy of the third quote is not a material factor. Applicant's Claims 1. The Applicant's claims, as gleaned from the bundle of documents filed in the Tribunal and from the hearing on Friday, 11 June 2021, are as follows: 1. The staircase was delivered with the stringers uncapped and with sheets of pine for the Respondent's subcontractor to cap after it was fitted. The Applicant claims that the capping was meant to be undertaken by the manufacturer in the factory; 2. A square post at the bottom of the stairs was, pursuant to the CAD drawing dated 15 June 2020 (A27), meant to be 1.979 metres tall (A30) and in American Oak to allow a dwarf wall to be built underneath the staircase. There is now an issue as to whether and to what degree the staircase can be moved to insert the taller post as the dwarf wall has been built around the staircase; 3. The staircase squeaks, is defective in appearance and quality and represents unacceptable value; 4. The staircase does not meet the job description and is not of acceptable supply or installation; 5. The Applicant states that she sought 'a complete American Oak staircase, stringers, treads, risers and a tall extended post in American Oak to be all stained or lacquered by us, no painting on staircase only on walls'. The Applicant said that she 'had already been provided for the same job description quote for $3,800 and for the same materials to be used for this staircase'. No quote for $3,800.00 of this specification was in the Applicant's bundle of documents. 6. The Applicant seeks to have the whole of the staircase removed and replaced with the product of another manufacturer as she has 'lost faith' in the Respondent. 7. The Applicant claims the sum of $12,490 inclusive of GST against the Respondent. 1. The Applicant paid an approximate 50% deposit in the sum of $1,776.00 to the Respondent at or about the time the site was measured. She has not paid the balance of the third quote. This amounts to a further $1,777.00. 2. In addition, the Applicant has included in her documents an estimate from Sydney Stairs No. 005 dated 20 December 2020 for $6,952.00 to remove and install a solid American Oak staircase, stringers, treads and risers to be on in solid American Oak and to remove the wall and reinstall the walls correctly as per original plans in the sum of $6,952.00 (as A7-10) and a quote for $5,000.00 to remove the half wall under the stairs and repaint the wall in the sum of $5,000.00. 3. Although the Tribunal cannot precisely reconcile the sum of the Applicant's claim, it appears that she seeks $11,952.00 and to waive the outstanding balance of the contract sum of $1,770.00. Hearing 1. At the hearing the Applicant represented herself and Mr Edward Lloyd, CEO of the Respondent represented the Respondent in a telephone hearing. Three hours were allocated for the hearing but it is fair to say that a good amount of that time was not utilised constructively. 2. The Applicant continuously talked over the Respondent's CEO accusing him of being a liar and of being deceitful, despite the Tribunal's request to the Applicant to refrain from statements of this type. It was difficult in this environment for the Tribunal to address the relevant facts and issues and to deal with them. 3. The Applicant is apparently undertaking some refurbishments to the Residence as owner/builder and retains contractors directly to undertake the work that she requires. The Applicant is of mature age and, as she informed the Tribunal during the hearing, has a disability. The Applicant also has other applications before the Tribunal as a result of disputes with other contractors in connection with work undertaken to the Residence. Respondent's Evidence and Submissions 1. The Respondent made several pertinent points in its evidence and submissions. They included: 1. The Respondent had provided the staircase which the Applicant had requested and signed off on in the third quote; 2. The cost of a solid American Oak staircase would have been about $6,500.00, and not the $3,553.00 including GST which was the Respondent's third quote; 3. The Respondent was aware of this from her contemporaneous quote from Sydney Stairs dated 2 June 2020 (A5) and that she would not receive solid American Oak for this lesser price range; 4. None of the Respondent's three quotes had been for solid American Oak which, as Mr Lloyd said, would have cost significantly more. This is confirmed by the two quotes of Sydney Stairs dated 2 June 2020 (A5) and 20 December 2020 (A7) which are for solid American Oak and which are for priced well above the third quote. 5. Solid American Oak is not what the Applicant ordered from the Respondent, as the Applicant well knew from the content of the third quote; and 6. The quote by Sydney Stairs dated 2 June 2020 (A5) in the sum of $6,512.00 including GST is for a 'Solid American Oak staircase' which was to be 'stained by client'. This predates the Respondent's three quotes, so the Applicant was independently aware of the price differential for solid American Oak. 7. The Respondent makes about 40 staircases per day on a 'supply and install' basis which it wraps and transports to customers all over Australia. It then has its subcontractors in each state install them. It has never previously had a customer take it or its products to a consumer tribunal such as the Tribunal. It has been building stairs for nearly 40 years. Applicant's Evidence and Submissions 1. The quote from Sydney Stairs dated 20 December 2020 (A7) to replace the Respondent's staircase states that for a price of $6,952.00 Sydney Stairs will provide a 'Solid American Oak staircase, stringers, treads and risers to be in solid American Oak. Remove wall and re install walls correctly'. 2. Further, in the commentary to the estimate are the following statements: 1. 'Staircase to be removed as the design and materials used do not match client's wishes'. 2. 'Overall quality of original staircase is subpar and should never have been installed. It squeaks and has patches of timber putty used to hide the winders being cut short (you cannot stain putty) see attached photos for reference'. 3. 'Two main posts made from different species of timber and veneered MDF tread and risers. see photos for reference'. 4. 'MDF stringers which have only been veneered on the tops and not on the face. See attached photos'. 5. 'Supporting winder riser not meeting main post. See photos and main post has been cut down to stringer and cannot be extended to support necessary dwarf racking wall'. 6. 'Sydney Stairs deems the staircase irreparable as it does not meet current design plans or quality finish. This quote is to remove the stair completely and reinstall a proper solid American Oak staircase with extended main post as required by Margaret Long. 1. There was only a single photo of the two main posts attached to A7. There were no photos attached to A7 of: 1. the timber putty, 2. the veneered MDF tread and risers, 3. the MDF stringers which have only been veneered on the tops and not on the face, 4. the supporting winder riser not meeting main post, and 5. the main post cut down to stringer level. 1. The Applicant claimed that these comments supported her claims of poor quality and of a product inconsistent with what she had ordered. 2. The Tribunal however has concerns about the weight that it should attribute to these statements in A7. First, they do not form part of an expert report submitted by the Applicant. Rather they are informal comments from a competitor of the Respondent which arise incidental to a quotation or estimate for a replacement staircase. 3. Secondly, they were not obtained or commissioned from an independent expert pursuant to the Expert's Code of Conduct or NCAT Procedural Direction 3, although the Tribunal notes that such Procedural Direction only applies to proceedings in the Consumer and Commercial Division involving HBA claims where the amount claimed or in dispute is more than $30,000.00. 4. Thirdly, Sydney Stairs Pty Ltd appears to be a corporation with an ACN 622 656 624 however its address is a residential address at 54 Brampton Drive, Beaumont Hills, NSW, 2155 and the contact quoted on the quotation has a g.mail address. Also, it appears to have no internet site or online presence. 5. For all these reasons it is difficult to assess what weight (if any) the Tribunal should attribute to the incidental comments in A7, especially in connection with any comments that it makes about the quality of the Respondent's staircase. 6. The Tribunal will deal with each of the quality issues alleged by the Applicant separately. Consideration Post 1. It is clear on the evidence that the Applicant sought a long single post at the bottom of the staircase against which she could build a dwarf wall. This may not be clear in the terms of the third quote but is clear from the CAD drawing dated 15 June 2020 (A27). 2. The post was apparently cut by the Respondent or its subcontractors. Further, there was evidence that another long post was then delivered to the Applicant by the Respondent (A30). It also appears to have been cut short by the Respondent's subcontractor. The reason for this is unclear. 3. The Applicant maintained at all times she had wanted a long post against which a dwarf wall would be built under the stairs. 4. The Respondent alleged that the subcontractor had cut the second post at the direction of the Applicant – and that the Respondent therefore had no liability - but this makes no sense to the Tribunal, and the Applicant denies it. It is incomprehensible that the Applicant having demanded a replacement long post in accordance with the CAD drawing would then direct the Respondent's subcontractor to cut it short. 5. In all the circumstances, the Tribunal finds in respect of this issue that the Respondent's failure to deliver and install a long post at the foot of the stairs is a breach of the contract and of the CAD drawing (A27) which clearly shows a long post in the three dimensional CAD drawing. 6. The Respondent needs to make good this aspect of the contract with the Respondent and the Tribunal makes an appropriate work order pursuant to s.48MA of the HBA to give effect to this. Other issues – Uncapped Stringers 1. At 15(1) above the Applicant complains that the staircase was delivered with the stringers uncapped and with sheets of pine for the Respondent's subcontractor to cap after it was fitted. 2. The Applicant claims that the capping was meant to be undertaken by the manufacturer in the factory but there does not be any basis either in the Contract or otherwise to assert this. 3. The Respondent intended to cap the stringers on site and after the staircase was installed in the Residence. 4. The Tribunal finds that the Respondent was entitled to take this course and that there is nothing in the Contract which prohibits or prevents this. 5. There is also an issue about whether capping was provided to the side of the stringers or only to the top of the stringers. There was also a string feed provided to take up the variance of any gaps between the staircase and the wall. It appears from the photographs (A31) that these matters remain outstanding but can still be attended to by the Respondent. 6. The Applicant also complained about gaps between the staircase and the wall which she said suggested poor workmanship. The Respondent denied this and claimed that any divergence between the stringer and the wall was more likely to be as a result of the existing wall not being plumb. The Tribunal accepts this. 7. The capping of the stringers on site rather than in the factory does not give rise to any right on behalf of the Applicant to terminate or abandon the Contract. Squeaks and Defective 1. At 15(3) above the Applicant complains that staircase squeaks, is defective in appearance and quality and represents unacceptable value 2. In paragraph 9 of her Points of Claim document (A1), the Applicant refers to 'the defective staircase that (the Respondent has) supplied as defective manufacturing and defective supply and defective installations made'. 3. Although the word 'defective' is used six times in 13 paragraphs, the Tribunal is none the wiser for the precise manner in which the defects arise or manifest themselves. 4. It is not unusual for wooden stairs to squeak at any time during their lifetime. This is not so much a defect but a characteristic of wooden staircases. It can be readily resolved. 5. As such, it does not give rise to any right on behalf of the Applicant to terminate or abandon the Contract. Does not meet job description and is of unacceptable supply and installation 1. At 15(5), the Applicant says that the staircase does not meet the job description and is not of acceptable supply or installation. 2. For the reasons outlined above, the Tribunal finds that the Applicant received what she ordered and signed up for in the third quote. 3. All three of the Respondent's quotes to the Applicant provided for MDF stringers with an American Oak overlay. Alternatively, none were for a solid American Oak staircase. 4. The Tribunal finds that this is what the Applicant accepted when she signed the third quote on 9 June 2020. And the signed third quote is what the Respondent then relied upon to manufacture the staircase. 5. In these circumstances, the Tribunal rejects the Applicant's evidence to the contrary. It is not supported on the contemporaneous documents. The Sydney Stairs replacement quotation is for a solid American Oak staircase – which was not the specification ordered of the Respondent by the Applicant. Removed and Replaced 1. At 15(6), the Applicant says that she seeks to have the whole of the staircase removed and replaced with the product of another manufacturer as she has 'lost faith' in the Respondent. 2. The Applicant has not made out her case in a manner satisfactory to sustain such an outcome and the Tribunal rejects this submission. Generally 1. The Tribunal finds that, with the exception of the Post, the Respondent's staircase was built to the price and specification signed off on by the Applicant in the third quote. 2. A sales representative of the Respondent, Robyn Malzard, did not give evidence but her version of events was contained in the letter dated 14 December 2020 which was sent by NSW Fair Trading to the Applicant and is attached to Tribunal File No. HB 21/01494. This letter is in the Applicant's bundle (A14-16) but gives the Respondent's account of the contracting process in terms similar to that outlined at the hearing by the Respondent's CEO. 3. In respect of the Applicant's complaints about the general, poor quality of the staircase no expert opinion was provided in support of her claim. Again, she relied upon the comments in the Sydney Stairs' estimate dated 20 December 2020 (A7), referred to above, which the Tribunal finds are inconclusive, do not satisfy the Tribunal's requirements for an expert report under the Expert Code of Conduct and are not objective. Also, Sydney Stairs had an interest in criticising the Respondent's product as it stood to gain from the remedial work that this may create. 4. As a result of this, the Tribunal finds that the Respondent has erred only in respect of the cutting and installation of the Post at the foot of the staircase and is willing to make a work order in that respect for the Applicant. 5. However in respect of the balance of matters alleged against the manufacture or installation of the staircase by the Applicant, the Tribunal does not consider that the Applicant has provided sufficient objective evidence (other than the evidence addressed above) to prove her case on the balance of probabilities; or to satisfy her allegation that the staircase is otherwise of unmerchantable quality or is not fit for purpose. 6. In addition, seeking costs of the demolition of the staircase as a result of a wall that the Applicant has apparently had built after the staircase was installed is not an appropriate measure of consequential loss which the Respondent should be required to pay. If the Applicant knew that she was to reject the staircase and commence proceedings about it, it would have been advisable not to permanently affix it in place with a dwarf wall before so doing, and then seek the demolition of the dwarf wall as an additional head of damages. Conclusion 1. For these reasons the Tribunal proposes to make a work order in respect of the Post only and will dismiss the balance of the application. As the contract remains on foot, the parties can and should complete the contract. 2. For this to occur: 1. The Applicant shall allow the Respondent or its subcontractor access to the Residence so that the work can be completed; 2. The Respondent or its subcontractor shall complete the installation of the staircase, including but not limited to: 1. Capping the stringers in pine; and 2. Affixing the string feed over any gaps. 1. The Applicant shall then pay the Respondent the balance of the purchase price under the contract. ********** I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 05 August 2021