Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Adam Eftimoski v Metricon Homes Pty Ltd [2014] NSWCATCD 254 Hearing dates: 13 June 2014 Date of orders: 28 October 2014 Decision date: 28 October 2014 Jurisdiction: Consumer and Commercial Division Before: D Goldstein, Senior Member Decision: The parties have 21 days after the date of the orders in these proceedings to submit an agreed work order that reflects the Reasons for Decision, or if such agreement cannot be reached, the work order that each of them submits ought to be made, having regard to the Reasons for Decision. Metricon Homes Pty Ltd must pay Adam Eftimoski the sum of $1,500.00 as liquidated damages within seven days of the date of this order. The applicant's claim for loss of rental income is dismissed. The applicant's claim for reimbursement for tiling is dismissed. Either party is at liberty to make a costs application in these proceedings. Any costs application pursuant to section 60 of the Civil and Administrative Tribunal Act 2013 or rule 38 of the Civil and Administrative Tribunal Rules 2014 must be lodged in the Tribunal and served on the costs respondent within 21 days of the date of this order either attaching or referring to the documents relied upon in support of the application The costs respondent will have 21 days after the date of receipt of the costs application referred to above, to lodge in the Tribunal and serve on the costs applicant the submissions, if any, in response to the costs application, such submissions either attaching or referring to the documents relied upon The cost applicant will have 14 days after the date of receipt of the cost respondent's submissions to lodge in the Tribunal and serve on the costs respondent the submissions, if any, in reply, such submissions either attaching or referring to the documents relied upon. The Tribunal will determine any costs application on the basis of the papers lodged in the Tribunal Catchwords: Defective brickwork, defects, liquidated damages Legislation Cited: Environmental Planning and Assessment Act 1979, Civil and Administrative Tribunal Act 2013; Home Building Act 1989 Cases Cited: Bellgrove v Eldridge (1954) 90 CLR 613, Makita (Australia) Pty Ltd v Sprowles (2001) 52 NSWLR 705, Pownall v Conlon Management Pty Ltd (1995) 12 WAR 370, Radford v De Froberville [1977] 1 WLR 1262 at 1270, Tabcorp Holdings Pty Limited v Bowen Investments Pty Limited [2009] HCA 8 (12 February 2009). Category: Principal judgment Parties: Adam Eftimoski (applicant) Respondent: Metricon Homes Pty Ltd (respondent) Representation: Solicitors: Mark Evans, solicitor for the applicant BCP Lawyers, solicitors for the respondent File Number(s): HB 14/09414 Publication restriction: Unrestricted reasons for decision 1. These proceedings were commenced in February 2014. The applicant originally sought the sum of $242,168.60 from the respondent. 2. The respondent is a home building company. 3. On 23 May 2012 the parties entered into a written contract (the 'contract') whereby the respondent was to build a 'Newhaven 33' style home (the residence') for the applicant on the applicant's land in consideration of the applicant paying the price of $419,115.00. 4. The amount claimed by the applicant is broken down into the following amounts: 1. rectification and repairs $204,550.00; 2. reimbursement for tiling $15,218.60; 3. loss of rental income $14,000.00; and 4. liquidated damages $8,400.00. 1. In these reasons for decision I will refer to the applicant as the owner and to the respondent as the builder. 2. There is no dispute that I have the jurisdiction to hear this building claim under the provisions of the Home Building Act 1989 (the 'Act'). 3. These proceedings were heard on 13 June 2014 before me. Both parties were legally represented. The parties filed and served lengthy written submissions in accordance with my orders. 4. The evidence filed in these proceedings for the owner was: 1. the statement of A. Eftimovski; 2. the builder's Sales Brochure; 3. the report of Mr P. Shepherd dated 29 January 2014; 4. the report of Mr P. Shepherd dated 12 May 2014; and 5. Austral Brick's letter dated 4 September 2013. 1. The evidence filed in these proceedings for the builder was: 1. the report of Mr A.C. Waights; 2. the report of Mr T Ransley; and 3. the builder's bundle of documents. 1. The parties' experts were not able to confer before the hearing to explore whether any agreements could be reached on technical issues despite the fact that I ordered that to occur on 3 June 2014. The failure of the parties to arrange for their experts to confer before the hearing increased the complexity of the hearing, since there was negligible common ground between the experts. The failure of the experts to confer is also a significant contributing factor to the time taken to prepare, and the length of these reasons. 2. The largest head of claim for the owner was his rectification and repair claim in the sum of $204,550.00. In his written submissions the owner stated that its case was based on breaches of the warranties implied by section 18B of the Act. 3. A Scott schedule was prepared consisting of 8 items. The owner by his expert claims a total of $204,550.00 and the respondent by its expert concedes a total of $6,830.00. 4. In order for the owner to succeed on his rectification and repair claim which I will call his defects claim, he must prove a breach of contract which in this case will be a breach of one or other of the warranties implied by section 18B of the Act. In doing so the owner must by evidence prove his claims on the balance of probabilities, the civil standard of proof. The relevant principles in relation to discharging the burden of proof in civil cases were recently summarised by McDougall J. in the New South Wales Court of Appeal in Nguyen v Cosmopolitan Homes [2008] NSWCA 246 at [55] as follows: 1. A finding that a fact exists (or existed) requires that the evidence induce, in the mind of the fact-finder, an actual persuasion that the fact does (or at the relevant time did) exist; 2. where on the whole of the evidence such a feeling of actual persuasion is induced, so that the fact-finder finds that the probabilities of the fact's existence are greater than the possibilities of its non-existence, the burden of proof on the balance of probabilities may be satisfied; 3. where circumstantial evidence is relied upon, it is not in general necessary that all reasonable hypotheses consistent with the non-existence of a fact, or inconsistent with its existence, be excluded before the fact can be found; and 4. a rational choice between competing hypotheses, informed by a sense of actual persuasion in favour of the choice made, will support a finding, on the balance of probabilities, as to the existence of the fact in issue. 1. The warranties implied by section 18B of the Act are replicated in clause 38.1 of the contract. 2. Given that these proceedings involve a contest between the parties' respective experts, it is relevant to state that experts are required to provide a reasoning process to support the conclusions reached in their reports. 3. The decision of the Court of Appeal in the case of Makita (Australia) Pty Ltd v Sprowles (2001) 52 NSWLR 705 makes it clear that a reasoning process is to be stated by an expert when giving opinion evidence. In particular, I have had regard to paragraph 85 of Heydon JA's (as he was then) judgement, where his Honour states: "85 In short, if evidence tendered as expert opinion evidence is to be admissible, it must be agreed or demonstrated that there is a field of "specialised knowledge"; there must be an identified aspect of that field in which the witness demonstrates that by reason of specified training, study or experience, the witness has become an expert; the opinion proffered must be "wholly or substantially based on the witness's expert knowledge"; so far as the opinion is based on facts "observed" by the expert, they must be identified and admissibly proved by the expert, and so far as the opinion is based on "assumed" or "accepted" facts, they must be identified and proved in some other way; it must be established that the facts on which the opinion is based form a proper foundation for it; and the opinion of an expert requires demonstration or examination of the scientific or other intellectual basis of the conclusions reached: that is, the expert's evidence must explain how the field of "specialised knowledge" in which the witness is expert by reason of "training, study or experience", and on which the opinion is "wholly or substantially based", applies to the facts assumed or observed so as to produce the opinion propounded. If all these matters are not made explicit, it is not possible to be sure whether the opinion is based wholly or substantially on the expert's specialised knowledge. If the court cannot be sure of that, the evidence is strictly speaking not admissible, and, so far as it is admissible, of diminished weight. And an attempt to make the basis of the opinion explicit may reveal that it is not based on specialised expert knowledge, but, to use Gleeson CJ's characterisation of the evidence in HG v R (1999) 197 CLR 414, on "a combination of speculation, inference, personal and second-hand views as to the credibility of the complainant, and a process of reasoning which went well beyond the field of expertise" (at [41])." [Emphasis added] 1. In the course of his judgement, commencing at paragraph 80, Heydon JA referred to a number of decisions of Anderson J. in the Supreme Court of Western Australia. In Pownall v Conlon Management Pty Ltd (1995) 12 WAR 370 at 389-90 his Honour Anderson J. stated: "Expert opinion is to be judged like any other evidence. It must be comprehensible and reach conclusions that are rationally based. The process of inference that leads to the conclusions must be stated or revealed in a way that enables the conclusions to be tested and a judgment made about the reliability of them." 1. In a case where the parties are seeking to establish or rebut a breach of one or other of the warranties referred to in clause 38.1 of the contract, the expert evidence should, in my view, indicate which warranty has been breached and the basis for stating that. It should not be for the Tribunal to have to infer from an expert's report which contractual warranty is in issue and that the expert's evidence is stating, for example, that the work has not been performed in a proper and workmanlike manner when the expert's evidence simply does not state that. 2. In these reasons for decision I have been critical of the evidence of both experts. I do not think that it is appropriate to prefer the evidence of one expert over the other on a global basis as that would not, in my view, address the evidence before the Tribunal in the most precise manner. Since the owner's case is one based on defective work, I will consider the evidence of the experts on an issue by issue basis. 3. It has been suggested by Mr Ransley, the expert for the builder in some instances that there is no evidence of water penetration, or of damage, and by the builder in its final submissions that there is no evidence of damage. In my view these observations are not to the point. If there has been a breach of one of the warranties contained in clause 38.1 of the contract it is not necessary for the owner to wait for physical damage to occur before a claim for damages is maintainable. The owner will have sustained damage by reason of the breach of the warranty and his damages will normally be the amount to be spent in remedial work to ensure that the work in question is rectified to produce conformity with the contractual drawings and specifications or to address other issues for which a warranty has been provided in the contract. 4. The builder has made a submission that if defects were conceded by Mr Ransley, then the defects liability period referred to in clause 29 of the contract applied and that the owner failed to notify the builder of the defects within the 13 week period referred to in clause 29. The builder's submissions do not state what the consequence of this failure is. Clause 29.2 is not mandatory. The owner had an option whether or not to give a defects list under clause 29.2. The fact that he did not give a defects list did not in my view prevent him from bringing an action in the Tribunal for damages for breach of implied warranties, or breach of clause 38.1 of the contract. 5. When opening the owner's case the solicitor for the owner stated that his client did not seek an order for damages, but in lieu of such an order sought a work order under section 48O of the Act. I will deal with the issue of whether it is appropriate in these proceedings to make a work order, before consideration of the defects raised by the owner. Work Order 1. Section 48O(1) of the Act sets out the powers of the Tribunal. That section provides: 'In determining a building claim, the Tribunal is empowered to make one or more of the following orders as it considers appropriate: (a) an order that one party to the proceedings pay money to another party or to a person specified in the order, whether by way of debt, damages or restitution, or refund any money paid by a specified person, (b) an order that a specified amount of money is not due or owing by a party to the proceedings to a specified person, or that a party to the proceedings is not entitled to a refund of any money paid to another party to the proceedings, (c) an order that a party to the proceedings: (i) do any specified work or perform any specified service or any obligation arising under this Act or the terms of any agreement, or (ii) do or perform, or refrain from doing or performing, any specified act, matter or thing.' 1. The parties have provided written submissions which I have had regard to in considering the owners' request that I make a work order. 2. In considering this issue I will proceed upon the basis that the Act provides me with the discretion to make an order of the type mentioned in section 48O(1)(c)(i) as I consider it appropriate. In other words I have considerable discretion. However, I accept that such discretion ought to be exercised judicially and with due consideration. 3. The owner's submissions referred to the decisions of Bellgrove v Eldridge (1954) 90 CLR 613 and Tabcorp Holdings Pty Limited v Bowen Investments Pty Limited [2009] HCA 8 (12 February 2009) in support of the position that he was entitled to the work in constructing residence being performed in accordance with the contractual requirements. It followed in his submission that damages that ordinarily flow from a failure to perform building work in accordance with the contractual requirements will be the costs of rectification, subject to the qualifications expressed in Bellgrove v Eldridge. 4. The builder's position may be stated to be that it is not reasonable for a work order to be made in connection with brickwork issues because that would require the builder to demolish and rebuild the brickwork in order to rectify those mortar bed joints which are conceded not to comply with the thickness tolerances in item (g) of Table 12.1 of AS 3700-2011. It is conceded by the builder that 10 -15% of mortar bed joints do not comply. Further it is submitted on behalf of the builder that the owner's main complaint relating to the brickwork is in relation to aesthetics. In that regard reference is made at paragraph 19 of the submissions to the way that the owner's solicitor opened his case. 5. In Tabcorp Holdings Pty Limited v Bowen Investments Pty Limited the High Court of Australia discussed reasonableness as referred to by the High Court in Bellgrove v Eldridge. The Court stated: "The example which the Court" (in Bellgrove v Eldridge) 'gave of unreasonableness was the following[26]: "No one would doubt that where pursuant to a building contract calling for the erection of a house with cement rendered external walls of second-hand bricks, the builder has constructed the walls of new bricks of first quality the owner would not be entitled to the cost of demolishing the walls and re-erecting them in second-hand bricks." That tends to indicate that the test of "unreasonableness" is only to be satisfied by fairly exceptional circumstances.' 1. There are two issues that I consider to be relevant to the question of whether an order should be made in the owner's favour for a work order. The first is whether, absent an application for a work order, damages to rectify the out of tolerance mortar bed joints would be unreasonable. The second issue is the question of whether or not a rectification methodology is reasonable should have a bearing on the making of a work order under section 48O(1)(c)(i) of the Act. 2. In my view the answer to the first issue is no, and the answer to the second issue is that whether or not a money order would be made under section 48O(1)(a) of the Act for rectification work would be a highly relevant, but not a determinative factor in considering whether a work order should be made. 3. My reasons for coming to the conclusion that it would not be unreasonable for the owner to recover rectification damages for a breach of contract relating to the thickness of mortar bed joints proceeds on the fact that there has been, as found later in these reasons, an admitted failure to comply with an Australian Standard. I am satisfied that such a failure consists of a breach of the contract. In my view there has been a breach of clause 38.1 of the contract. 4. Given that there has been a breach of contract the owner is entitled to the cost of making the work or building conform to the contract, subject to the qualification that the work must be necessary to produce conformity to the contract, and the undertaking of the work must be a reasonable course to adopt. 5. The demolition and rebuilding of the brick walls of the house in order to achieve conformity with AS 3700-2011 is not an exercise of a similar nature as the example provided in Bellgrove v Eldridge, namely demolition to replace new bricks with second hand bricks. 6. The High Court in Tabcorp Holdings Pty Limited v Bowen Investments Pty Limited stated that 'the test of "unreasonableness" is only to be satisfied by fairly exceptional circumstances.' An example of such exceptional circumstances was stated to be closely aligned with a party 'merely using a technical breach to secure an uncovenanted profit' as referred to by Oliver J. in Radford v De Froberville [1977] 1 WLR 1262 at 1270. There is no suggestion of the owner engaging in such conduct in this case. 7. In my view there is nothing exceptional in an owner of a new residence requiring a builder to construct the brickwork in compliance with contractual terms and in accordance with an Australian Standard which is admitted by the builder's expert to be relevant to the construction of brickwork. After all, the builder had every opportunity in the course of construction to exercise all necessary supervision of tradesmen to ensure compliance with Australian Standards and other regulatory requirements such as the Building Code of Australia. 8. The fact that the rectification of brickwork proposed by the owner and conceded to be required by the builder's expert would not, in my view, be unreasonable when considering the making of a money order under section 48O(1)(a) of the Act, is a compelling reason that it is appropriate to make a work order under section 48O(1)(c)(i) of the Act. 9. I will deal with each item of the owner's defects claim in turn. If I find that work has not been carried out in accordance with clause 38.1 of the contract, I will indicate that rectification work should form part of the work order to be made in the proceedings. 10. Before proceeding any further, I will say that I accept each expert in these proceedings as being suitably qualified to give opinion evidence. Brickwork 1. The first and largest item of the owner's defects claim is his claim relating to brickwork. An amount of $94,491.00 was claimed in connection with this item of claim. 2. The fact that the experts were not able to confer in relation to technical issues has not assisted the efficient resolution of this issue, among many others. 3. I will say at the outset of my consideration of this head of claim that I will not take into account any comment of an expert as to whether he considers it reasonable or not to carry out rectification work. I do not regard that issue as one that ought to be the subject of expert evidence. I will only have regard to the experts' evidence concerning the work that has been identified as defective and the basis upon which it is asserted or denied that work does not comply with the implied warranties set out in section 18B of the Act and in clause 38.1 of the contract in connection with brickwork. 4. There are a number of aspects of the brickwork defects claim. They are: 1. Articulation joints; 2. Mortar bed and perpend size and finish; 3. Weepholes; 4. Sagging lintels; 5. Brickwork alignment; 6. Brickwork appearance. Articulation joints 1. In connection with articulation joints the builder's expert Mr Ransley accepts that there has been a breach of the relevant Australian standard, which Mr Waights has identified as AS 3700, 2011 edition. Mr Ransley has identified the relevant areas of the premises where the breaches have occurred. In this regard I prefer Mr Ransley's evidence as it is more specific than the general nature of Mr Shepherd's evidence. However it should be noted that both experts say that there has been a breach of relevant standards in this area. 2. Mr Shepherd does not provide a specific cost of rectifying the issue of articulation joints. Mr Ransley estimates a cost of $415.00. However, as the owner seeks a work order, competing cost assessments become less relevant. 3. The result is that the owner has been successful in connection with the issue of articulation joints. The builder has breached clause 38.1(a) of the contract. The necessary rectification work for articulation joints on the basis of Mr Ransley's evidence will be included in the work order. Mortar beds, perpend size and finish 1. The next aspect of this claim is the owner's complaint regarding mortar beds and perpend size, and finish. 2. The owner's expert Mr Shepherd states that there has been a breach of the relevant Australian Standard AS 3700 and that the laying of the brickwork is defective. He refers to beaches in connection with the thickness of mortar bed joints and perpend joints. 3. Mr Ransley on behalf of the builder states that the 'overwhelming proportion of bed joints comply'. I take it that Mr Ransley concedes that there is some non-compliance in connection with bed joints. He states that prepend joints comply. 4. Mr Waights discusses the permitted tolerance for a deviation from the permitted mortar joint thickness and states 'The majority of the bed joints meet this tolerance requirement; however there are bed joints on each elevation that exceed this tolerance. I estimate that approximately 10 to 15% the bed joints are in the range of 14 to 17 mm and do not meet this tolerance requirement.' (emphasis added). 5. I have found the evidence of Mr Waights to be the most useful in connection with this aspect of the brickwork claim. In cross examination Mr Waights confirmed that the variation in mortar beds did not occur in one location, but were in all elevations. He stated that the only way to remedy the variation in mortar beds was by demolition. 6. In connection with perpend joints, Mr Waights states that perpend joints are within tolerance. I prefer Mr Waights evidence to Mr Shepherd's in connection with perpend joints. 7. As a result of the foregoing analysis, I find in the owner's favour on mortar bed joints. All experts agree that the builder has failed to comply with the relevant Australian Standard in connection with mortar bed joints. The builder has breached clause 38.1(a) and/or (c) of the contract. 8. The necessary rectification work for mortar bed joints will be included in the work order. Weep holes 1. The next aspect of this claim is the owner's complaint regarding weep holes. 2. The owner's expert, Mr Shepherd has stated that there is a lack of weepholes 'at all locations'. There is also a complaint that flashings have not been correctly detailed or extended to the face of the brickwork at any location throughout the dwelling. 3. Mr Ransley on behalf of the builder concedes that the flashing below the kitchen window does not comply with the Building Code of Australia ('BCA') and that two weepholes are required. Mr Waights' evidence is to the same effect. 4. The evidence of the experts establishes that there has been a breach by the builder of the requirements of the BCA in connection with weepholes. The difficulty is that there is no concurrence as to the extent of the breach. Having regard to the fact that Mr Shepherd's evidence is so general and that Mr Ransley's and Mr Waights' evidence is specific, I prefer the specificity of their evidence. I find that the extent of the breach is limited to the flashing below the kitchen window where two weepholes are required. The builder has breached clause 38.1(c) of the contract. 5. The necessary rectification work for flashings below the kitchen window and the creation of two weepholes will be included in the work order. Sagging lintels 1. The next aspect of the brickwork claim is the owner's complaint regarding sagging lintels. 2. There is a competition between Mr Shepherd's evidence on behalf of the owner and the documentary evidence of Mr J Rafeletos on behalf of the builder. Mr Rafeletos is an engineer and his report regarding this issue is contained in the builder's bundle of documents. The owner's expert attached a letter from Lewis Engineering dated 15 August 2013 to its report signed by Mr Lewis Martin, a Chartered Professional Engineer. 3. Mr Rafeletos's letter dated 22 August 2013 responds to Mr Lewis's letter and states that there are no structural issues arising out of the 230 x75 lintel above the rear sliding door of the family room. 4. The way that the parties have gone about dealing with this issue is in effect by relying on competing documents from structural engineers. Mr Shepherd's qualifications as a carpenter, a building foreman and clerk of works do not in my view qualify him to provide opinion evidence about engineering matters. 5. I find that the owner has not discharged its onus of proving that the builder is in breach of the contract in connection with the complaint regarding sagging lintels because I prefer the evidence of Mr Rafeletos. 6. This aspect of its claim is dismissed. The work order will not include work relating to sagging lintels. Brickwork alignment 1. The next aspect of this claim is the owner's complaint regarding brickwork alignment. 2. Mr Shepherd states no more than that the brick work, particularly to the rear elevation has not been laid straight and level. He states the rear upper balcony brickwork is out of level by 20mm when measured off a 2m straight edge. Mr Shepherd also refers to a table 3.04 to establish where masonry work fails to conform with the tolerances set out in that table, the work is defective. The relevant section of Mr Shepherd's report does not set out the table referred to, or state where the table is to be found. 3. Mr Waights states that he had no access to the relevant areas and therefore could not take measurements. He did state that he could see no defects in the brickwork referred to from a normal ground viewing position. 4. Mr Ransley states that no significant deviations could be seen in the rear elevation of the brickwork from normal viewing positions at ground level. 5. In his reply report Mr Shepherd does not take the matter forward in any material way. 6. In connection with this claimed defect, the information that Mr Shepherd provides in his report allows me to have an actual persuasion that the fact alleged, namely that the brick work to the rear upper balcony has not been laid straight and level, exists. I infer from Mr Shepherd's evidence that he carried actually carried out the measurement to which he refers. 7. However, even accepting that that the rear upper balcony brickwork is out of level by 20mm when measured off a 2m straight edge, there is no evidence to form the basis for a finding that such fact constitutes a breach of one or more of the warranties found in clause 38.1 of the contract. 8. The owner has not produced any evidence to establish that out of level brickwork of 20mm over 2 meters breaches any Code, standard or the principles of good and proper workmanship. The reference to table 3.04 is not adequate to make that link. 9. For the reasons set out above, I am not persuaded on the available evidence that the owner has established that the brick work to the rear upper balcony elevation being out of level by 20mm when measured off a 2m straight edge constitutes a breach of clause 38.1 of the contract. This aspect of the owner's claim is therefore dismissed. 10. The work order will not include work relating to brick work to the rear elevation has not been laid straight and level. Brickwork appearance 1. Mr Shepherd states that he observed a significant variation in the colour and texture of the face brickwork, which was Austral Bowral Blue. This observation led him to conclude that the external face brickwork should be demolished and rebuilt using new bricks correctly laid and finished. 2. The owner' solicitor referred to the letter from Austral Bricks dated 4 September 2013 which was tendered as exhibit E in the Owner's case. The letter states that a representative of Bricks inspected the site. The letter states that there is a sheen on the bricks as result of the manufacturing process. The letter goes in to state that that the removal of that sheen during the high pressure cleaning process does not affect the durability of the brick. The owner relies on this letter in support of its case that the builder is responsible for the removal of the natural sheen of the brickwork through improper high pressure cleaning. 3. The Austral Bricks dated 4 September 2013 letter is attached to Mr Shepherd's report and is annexure O to Mr Mavin's statement. Interestingly the two documents are not identical. The difference lies in the last sentence of the first paragraph of the second page of the letter. In the document annexed to Mr Shepherd's report, the sentence reads 'Any change to the face of the brick is due to the cleaning but will not affect the structural integrity of the brick'. 4. In the document annexed to Mr Mavin's statement, the sentence reads 'The change to the face of the brick is aesthetic damage but will not affect the structural integrity of the brick'. 5. There is no explanation for the difference, but ultimately I do not think that it is of any consequence. 6. If the owner's case is that the builder has breached clause 38.1 of the contract because of the way that it cleaned the brickwork, it must establish that allegation on the balance of probabilities. Mr Shepherd relies on the letter from Austral Bricks dated 4 September 2013 which was tendered as exhibit E in the Owner's case. This letter does not establish that there has been a breach of clause 38.1 of the contract. The letter goes no higher than to say that the removal of the sheen from some bricks was during the high pressure cleaning process. The owner has not produced any other evidence to suggest that brick cleaning properly carried out does not affect or remove brick sheen. 7. Mr Waights stated that in his opinion the appearance of the brickwork was 'generally typical of the Austral Blue product laid with a raked mortar joint.' 8. Mr Waights stated that the loss of brick sheen was quite common after brick cleaning and that Bowral Blue bricks have a wide variation in colour. He also stated that in his opinion the brick cleaning process has been normal and what one would expect. 9. I was impressed by Mr Waights' evidence about this item when he was being cross examined. Mr Waights is a ceramic engineer. He has had 25 years' experience as a plant manager of brick manufacturing facilities in Australia and in the USA. Mr Waights understood the manufacturing process in creating bricks, including how they were 'fired' in a kiln and the effect that process has on the appearance of bricks. Mr Waights explained that because of the manufacturing process it was not possible for all bricks to have an identical appearance. 10. Mr Waights does acknowledge that there is efflorescence on the front elevation of the brickwork and that there were instances of a limited number of mortar joints where a section of the mortar had been dislodged during the brick cleaning process. Mr Waights states that remedial work, such a stain removal, by an experienced contractor and re-pointing would rectify what I would describe as the defects that he has identified. 11. Mr Ransley's evidence is to the same effect as Mr Waights'. 12. I prefer the evidence of Mr Waights in connection with Brick work appearance. I find that he has the most expertise in the area of the manufacture of bricks and the appearance of bricks. I accept his evidence that the appearance of the brickwork was 'generally typical of the Austral Blue product laid with a raked mortar joint.' 13. I also accept his evidence that there is efflorescence on the front elevation of the brickwork and that there were instances of a limited number of mortar joints where a section of the mortar had been dislodged during the brick cleaning process. These are what I would describe as defects or instances of breach of the warranties implied by section 18B of the Act. 14. I accept Mr Waights' evidence that these defects may be rectified by stain removal by an experienced contractor and re-pointing where necessary. 15. Finally, the owner's solicitor's submissions are that if there is, what they characterize as 'damage'. It follows that there must have been a breach of clause 38.1 of the contract. I reject this submission. The first step is for the owner to prove that there has been a breach of contract. In this instance, the logical breach will be that the brick cleaning was carried out in a way that breached clause 38.1(a) of the contract or some other provision of the contract with the result that there was a loss of sheen. Mr Waights evidence which I accept, was that the loss of brick sheen is quite common after brick cleaning. 16. The necessary rectification work for the removal of efflorescence staining and re-pointing of mortar joints will be included in the work order. Exposed Roof framing and Beams – amount claimed $7,833.00 1. Mr Shepherd deals with this subject at paragraphs 2A – E of his 29 January 2014 report. 2. Mr Shepherd has identified a number of instances of what he describes as defects. They are : 1. Failure to seal hardwood with suitable sealer , with the result that wood and water staining bleeds through and stains the acrylic coating; 2. One rafter not mitred; 3. Front roof beams poorly scarfed when they should have been mitred; 4. Roof beams not bolted to the timber posts; and 5. Failure to seal timber beams in brickwork; and roof beams at the rear cracking through paint finish. 1. Mr Ransley deals with this subject at section 2.0 of his report. His opinion is that the provisions of AS 1684.2 have not been complied with and that rectification costs of $320.00 will be incurred in the necessary rectification work. This relates to sub-paragraph (d) above. 2. Mr Shepherd's evidence satisfies me that there are issues to consider in connection with this item and that the builder's response to his evidence is necessary if the builder is to avoid liability on this issue. 3. In connection with (a), Mr Ransley makes the point that Mr Shepherd does not make clear what investigations or tests have been conducted. In making this point, Mr Ransley is to my mind taking on the role of an advocate. The point made is best made by counsel in submissions. Otherwise, Mr Ransley states that the paint coatings appeared satisfactory at the time of inspection. 4. I prefer the evidence of Mr Shepherd on this aspect of the claim. 5. In connection with the rafter referred to in sub-paragraph (b) above, I prefer the evidence of Mr Shepherd as he bases his evidence on the builder's failure to complete this work with a good and workmanlike finish. Mr Ransley states no loss results. The issue is not whether a loss has resulted. The issue is whether the work in question complies with or breaches section 18B of the Act. Mr Shepherd's evidence is that in this instance it does not comply. I accept his evidence. 6. The next item referred to in sub-paragraph (c) above has produced contradicting evidence from the experts. However, in reply Mr Shepherd concedes that mitred joints are not necessarily required by AS 1684. He states that it is to be considered the preferable method of construction so far as appearance is concerned in a quality home. There is no basis provided for this opinion. I do not accept the opinion without an established basis. 7. Mr Shepherd also points out that Mr Ransley has not addressed his point that full support for beams has not been provided over the posts. I am not convinced that this point was ever raised by Mr Shepherd, at least not in the terms he uses in his reply report. This issue seems to be highly technical and would have been best dealt with the expert's in conclave. 8. However, I am satisfied on the balance of probabilities that the circumstances asserted by Mr Shepherd exist as a fact. 9. The item referred to in sub-paragraph (d) above is admitted by Mr Ransley. However, the experts have not agreed on the appropriate rectification cost. 10. The final item referred to in sub-paragraph (e) is dealt with in some detail by Mr Shepherd. 11. Mr Ransley's response is to query what investigations or tests were carried out by Mr Shepherd. In my view these type of comments are best made by counsel in submissions. Mr Ransley's role should not be to seek to undermine Mr Shepherd's evidence in this way. He should address the substance of the complaint. In that regard, Mr Ransley states that he could not see significant cracking. I infer from this that he did see some cracking. 12. In connection with this item of the claim, I prefer Mr Shepherd's evidence to Mr Ransley's. 13. Except in connection with front roof beams poorly scarfed when they should have been mitred, I find in the owner's favour in relation to this head of the claim. 14. The necessary rectification work relating to a failure to seal hardwood with suitable sealer, one rafter not mitred, roof beams not bolted to timber posts and the failure to seal timber beams in brickwork and cracking roof beams at the rear of the residence will be included in the work order. Front Balcony – amount claimed $10,980.00 1. Mr Shepherd has identified multiple defects in the construction of the front balcony. He has given detailed a detailed explanation of them in paragraphs 3A – 3E of his report. 2. Mr Ransley responds to this claim. In his opinion there is defective work and the cost to rectify will be $370.00. Mr Ransley has divided this issue into 11 sub items. Mr Ransley has stated that items 3.4, 3.5, 3.9 and 3.11 ought to be addressed. He does not agree the costs estimated by Mr Shepherd. It is more efficient to deal with this section using the sub items identified by Mr Ransley. 3. My findings on each sub item are set out below. 4. 3.1. Inadequate fall. It is alleged that the falls to this verandah are inadequate. Mr Shepherd has not taken any measurements to establish that the falls do not comply with regulatory requirements or good building practice. He does not state what those requirements or practices are. However, he has attached one photograph which shows a straight edge with a level reading. The owner's photographs annexed to his statement show the ponding of water on a balcony. Mr Ransley's evidence is that he has tested the falls with a short level and the test suggests that water will discharge to edges. 5. Both experts' evidence in connection with this item is brief, and lacking in detail. 6. Mr Shepherd's evidence together with the owner's photographs showing the ponding of water is not of adequate weight to persuade me to the civil standard that the falls are inadequate. The photographs referred to are in themselves, not sufficiently persuasive, particularly when there is evidence from Mr Ransley that he has tested the levels of the surfaces and no problem has been disclosed. The owner has not established that the work complained of has breached clause 37.1 of the contract. 7. 3.2. Skirting tiles obstruct weepholes. Mr Shepherd states that the skirting tiles extend over weepholes and prevents the exit of water from the cavity. How he has established that fact is not stated. Mr Ransley states that there are weepholes 3 courses above the skirting. Mr Shepherd has not stated if there are regulatory requirements or accepted building practices that would prohibit the skirting tiles being placed where they are. Further, Mr Shepherd's evidence does not persuade me that the tile skirting does in fact obstruct weepholes as he has not provided an explanation to support his conclusions, or to demonstrate what he asserts to be the case, is in fact the case. It follows that Mr Shepherd's evidence does not provide a basis for a finding that the builder has breached clause 37.1 of the contract in connection with this item of the owner's claim. 8. 3.3. No Weepholes below the aluminium sliding door. I prefer the evidence of Mr Ransley in connection with this item which is that the door frame is fitted with a subsill which allows discharge of water by weepholes. 9. 3.4. Floor tiles not parallel. The expert evidence in relation to this item is not particularly satisfactory. Mr Shepherd's evidence seems to point to a failure by the builder to perform work in a proper and workmanlike manner. Mr Ransley's evidence is to the effect that there is no evidence that water is penetrating or causing damage. I have made comments about this type of evidence above. Mr Ransley concedes that there are out of parallel tiles as stated by Mr Shepherd, although he says it is minimal. He also conceded that a joint ought to be sealed, although he states that is for aesthetic purposes. 10. I prefer Mr Shepherds's evidence. It is in part confirmed by Mr Ransley. 11. 3.5 Fascia Loose. Mr Ransley concedes this item. There is a difference between the experts about the remedial cost. 12. 3.6. Handrail posts. Mr Shepherd's opinion is based on an assumption that the fixing screws will have pierced the waterproof membrane. He has not demonstrated that has actually occurred. He has not pointed to evidence of water ingress which would substantiate his assumption. This evidence is not sufficient to discharge the owner's onus of proof. However in reply, Mr Shepherd sets out an extract from AS 4654.2 which shows that the fixing of handrail posts should be protected by membrane below the finished floor level. The photographic evidence discloses that handrail posts have not been fixed in contravention of AS 4654.2. Overall, I accept Mr Shepherd's evidence. 13. 3.7. Brick columns height. I accept Mr Shepherd's evidence which is not contradicted by Mr Ransley. 14. 3.8. Handrail wire spacing. I prefer Mr Shepherd's evidence to Mr Ransley's. Mr Ransley does not address the BCA requirement of a 125mm sphere not being able to pass through an opening in a balustrade raised by Mr Shepherd. 15. 3.9. Gaps between fascia & timber soffit. Conceded by Mr Ransley. There is a difference between the experts in connection with cost. 16. 3.10. Timber beams not sealed. I prefer Mr Shepherd's evidence. Mr Ransley does not deal with the issue raised by Mr Shepherd. He does no more than to raise doubts about the prospect of moisture damage. Mr Ransley is acting more like an advocate than an expert in connection with this item. 17. 3.11. Ends of timber trims not painted. Conceded by Mr Ransley. 18. The necessary rectification work relating to the floor tiles not being parallel, the fascia being loose, the screw fixing to handrail posts to be in accordance with AS 4654.2, the brick columns height, the handrail spacing, the gaps between fascia & timber soffit, the timber beams not being sealed and the ends of timber trims not being painted will be included in the work order. Rear balcony – amount claimed $14,679.00 1. Mr Shepherd has dealt with this item in paragraphs 4A to 4D of his report. There are a number of items of claim in this section. 2. Mr Ransley has responded in section 4 of his report. He has split the section into 9 sub items. He estimates rectification costs at $840.00. It is more efficient to deal with this section using the sub items identified by Mr Ransley. Mr Ransley has made a concession in connection with item 4.3. 3. 4.1. Skirting tiles obstruct weepholes. Mr Shepherd states no more than 'Skirting tiles have been attached to the rear wall and obstruct the weepholes.' He makes a further statement at page 54 of his report that 'skirting tiles have been fixed to the brickwork to obstruct these weepholes'. He has not connected these statements to any of the material in section 4 of his report, in particular the Guide to External Waterproofing: Balcony Decks extracted on page 56 of his report. It ought not be the function of the Tribunal to connect these statements to extracts from regulatory material in order to make the owner's case that there has been a breach of a warranty in section 38.1 of the contract. However, item 6 of this Guide appears to be relevant. Mr Ransley's evidence does not address this issue. He states that weepholes are visible above the skirting tiles and that the wall is protected by an overhang. He further states that there is no evidence of water penetration or non-compliance with BCA performance requirement P2.2.2 which is not extracted or explained. 4. Mr Shepherd's evidence, which I understand to be that this work was not carried out in a proper and workmanlike manner or in accordance with the Guide to External Waterproofing: Balcony Decks is accepted in preference to Mr Ransley's evidence which does not address the issue and tends towards advocacy on behalf of the builder. The fact that Mr Shepherd has extracted the Guide to External Waterproofing: Balcony Decks has caused me to accept his evidence in connection with this item. 5. 4.2. No weepholes below aluminium sliding doors sill. I prefer Mr Ransley's evidence which is that the door frame is fitted with a subsill which allows for weepholes concealed by a weatherstrip to discharge water. 6. 4.3. Sliding door sill not straight. Conceded by Mr Ransley. 7. 4.4. Perimeter and intermediate joints omitted. Mr Ransley has conceded that intermediate joints are omitted and that there is hairline cracking of tiles. How Mr Shepherd has come to the conclusion that there are no perimeter joints is not explained. A photograph is included which requires the viewer to form his own conclusions, namely that no joint is contained at the floor/skirting tile junction. There is sufficient evidence (barely) to persuade me that this item of claim is made out. 8. 4.5. Gaps between handrail cladding and brickwork. The experts are at issue as to whether the gaps referred to by Mr Shepherd have been sealed. Mr Ransley stated that when he inspected the gaps were sealed. This item is to be included in the work order in the event that gaps are still present. 9. 4.6. Sarking not fitted behind cladding. To succeed in relation to this item the owner must establish that sarking has not been fitted. Mr Shepherd originally did not explain how he arrives at this conclusion. Photo 4.1 of his report is not in my view conclusive or particularly demonstrative. It has a conclusion attached to it of No sarking behind the cladding. Mr Shepherd also states that the bottom outside edge of the cladding has not been blocked to provide a continuous support to the edge of the sheet. It seems that the combination of these two matters cause Mr Shepherd to conclude that the cladding needs to be removed. In reply Mr Shepherd stated that he identified that sarking had not been installed by lifting the flashings and taking the photograph which I assume is photo 4.1. He refers to the requirements of the cladding manufacturer, which are not produced or identified, that sarking be incorporated behind the cladding. Mr Ransley does not address whether or not sarking was omitted. 10. Mr Shepherd's evidence does not establish to my satisfaction that sarking has not been fitted. He does not persuade me that the cladding needs to be removed. 11. 4.7. Gaps between timber capping and trim below. The experts are at issue as to whether the gaps referred to by Mr Shepherd have been sealed. I accept the owner's solicitor's submission that Mr Ransley's assertion that the gaps have now been sealed is not disputed as stated in Mr Shepherd's reply report of 12 May 2014. 12. This item of claim is therefore dismissed. 13. 4.8. Bottom edge of f/c cladding not fully supported at lead flashing. Mr Shepherd states that this aspect of the timber framed handrail does not have full support, since blocking has not been provided between studs. Mr Ransley states that he applied force to the cladding and that it showed reasonable resistance against deflection. He concluded by stating that the cladding is adequately supported. Mr Shepherd's evidence does not establish that blocking between studs is required by, say the BCA or is necessary in order to carry out work in a proper and workmanlike manner. The owner has failed to make out this item of claim. 14. 4.9. Lead flashing poorly dressed. This aspect is disputed by the experts. It seems that Mr Shepherd states this work can be re-done when the cladding is removed and re-instated. This item will depend upon the owner being successful in obtaining an order for that work. Otherwise, Mr Shepherd's evidence does not establish that the lead flashing has been incorporated contrary to the BCA or otherwise than in a proper and workmanlike manner. His evidence is not sufficient to provide a sufficient basis for me to find that there has been a breach of clause 38.1 of the contract. 15. The necessary rectification work relating to skirting tiles obstructing weepholes, sliding doors not being straight, perimeter and intermediate joints omitted and gaps between handrails will be included in the work order. Windows and cladding – amount claimed $3,081.08 1. Mr Shepherd has dealt with this item in paragraphs 5A to 5E of his report. There are a number of items of claim in this section. 2. Mr Ransley has responded in section 5 of his report. He has split the section into 6 sub items. It is more efficient to deal with this section using the sub items identified by Mr Ransley. He has made a concession in connection with items 5.5 and 5.6. He estimates rectification costs at $1,700.00. 3. 5.1. Heads and sills of exposed windows not installed with a correctly installed flashing. Mr Shepherd refers to a non-compliance with the BCA, the relevant provisions of which he has identified and extracted. He has also reviewed the requirements of the weatherboard manufacturer, who he has identified, and extracted that supplier's details on flashing requirements. Mr Shepherd then states that the windows and weatherboards have not been fitted or flashed in accordance with the BCA or the manufacturer's requirements. 4. Mr Ransley states that the relevant windows are protected by eaves that provide sufficient overhang protection for windows without head flashings. That does not address the issue of the BCA requirements or the manufacturer's requirements. He concludes that the windows are installed adequately. 5. I prefer Mr Shepherd's evidence as it compares the actual installation with the BCA and the manufacturer's requirements. Mr Ransley's evidence in relation to this item is more in the nature of an advocate for the builder. He does not address the requirements referred to. He does however refer to a figure 3.3.4.4 which he extracts in his report. The source and relevance of figure 3.3.4.4 is not addressed or explained by Mr Ransley. 6. 5.2. Paint marks visible. Mr Shepherd states that he observed paint spots and drips to all windows. Mr Ransley concedes minimal paint marks are visible, but states that the repairs claimed are not warranted. The work order sought by the owner removes the need to decide issues regarding competing rectification costs. I will allow this item. 7. 5.3. Joints cracked in weatherboard cladding. Mr Shepherd states that the joint sealer to the joints of weatherboards is cracked allowing ingress of water and premature deterioration of cracking. Mr Ransly does not agree. He states that minor cracking is due to material or thermal movement which is rectified during maintenance. 8. Mr Shepherd does not state what in his opinion, the cause of the cracking is. Without evidence of this nature I am unable to make a finding regarding whether or not there has been a breach of one or other of the statutory warranties implied by section 18B of the Act or as contained in clause 38.1 of the contract. The owner has not produced any evidence which addresses the issue of the cause of the cracking. This item of the owner's claim is not accepted. 9. 5.4. Gaps between aluminium windows and brickwork. Mr Shepherd states that he observed gaps between a number of aluminium windows and adjacent brickwork, namely those windows and sliding doors identified by him on page 67 of his report. Mr Ransley does not agree that the defects exist. 10. Given that the existence of alleged gaps between the aluminium windows and adjacent brickwork referred to has not been agreed by Mr Ransley, and that there is no photographic evidence of the gaps, I am not persuaded that these gaps do in fact exist. The owner has not discharged the burden of proof in connection with this item. 11. 5.5. Folded flashing at top of brickwork not provided with a fall. Conceded by Mr Ransley. 12. 5.6. No gap between f/c cladding & folded flashing. Conceded by Mr Ransley. 13. The necessary rectification work relating to heads and sills of exposed windows without correctly installed flashing, paint spots and drips to windows, folded flashings at top of brickwork not having a fall and no gap between fibre cement cladding and folded flashing will be included in the work order. Roof Coverings and Gutters – amount $4,973.98 1. Mr Shepherd has dealt with this item in paragraphs 6A to 6E of his report. There are a number of items of claim in this section. 2. Mr Ransley has responded in section 6 of his report. He has split the section into 11 sub items. It is more efficient to deal with this section using the sub items identified by Mr Ransley. He has made a concession in connection with items 6.6, 6.9 and 6.10. He estimates rectification costs at $2,290.00. 3. 6.1 Paint spots. Mr Shepherd states that he observed paint spots and splatters on the surface of roof tiles. Mr Ransley concedes minimal paint marks are visible but states that the repairs claimed are not warranted. Items 2 and 3 of paragraph 6E of Mr Shepherd's report includes this item in the cost of removal and replacement of tiles together with a number of the items in this section. The evidence establishes that there are paint spots and splatters on the surface of roof tiles. 4. 6.2. Chipped roof tiles. Mr Shepherd states that he has observed a number of chipped tiles. He also states that he observed that in places the entire colour coat of the tile had been chipped through to the raw concrete base material. He also stated that the chipped sections are clearly evident. Mr Ranlsey states that the tiles appear satisfactory. I prefer the evidence of Mr Shepherd as it is more detailed and induces in me a belief that he has carefully dealt with this complaint. The owner has established that the tiles are chipped as asserted by Mr Shepherd. 5. Items 2 and 3 of paragraph 6E of Mr Shepherd's report include this item in the cost of removal and replacement of tiles. 6. 6.3. Builder's debris in gutters. Mr Shepherd states that he observed debris in gutter including screws and mortar. He refers to other material. With respect that description is not helpful if the complaint is under the heading of 'builder's debris'. Mr Ransley states that the debris has been removed. The photographs attached to the owner's statement show what appears to be builder's debris in gutters. Item 7 of paragraph 6E of Mr Shepherd's report estimates a cost of $78.00 to deal with this item, indicating that this is a minor ground of complaint that ought to have been resolved outside the Tribunal. I prefer Mr Shepherd's evidence on this item. It is confirmed by the owner's photographs. 7. 6.4. Screws securing downpipes obstruct outlet. Mr Ransley in my view concedes this item by stating that gutter screws should be cut if they are a concern. Item 7 of paragraph 6E of Mr Shepherd's report includes this work in the estimated cost of $78.00, again indicating that this is a minor ground of complaint that ought to have been resolved outside the Tribunal. I prefer Mr Shepherd's evidence on this item. 8. 6.5. Gutter outlets are zincalume not colourbond. Mr Shepherd states no more than 'Gutter outlets are Zincalume not Colourbond nor have they been painted.' in connection with this item. However, Mr Ransly concedes that spigot surfaces ought to be painted a matching colour if exposed by movement to the downpipe. The experts' evidence in connection with this item is not particularly helpful. The owner's evidence does not provide a basis that that allows me to find that there has been a breach of clause 38.1 of the contract. 9. 6.6. Upper roof spreader. Conceded by Mr Ransley 10. 6.7. Flashings over rear lower roof incorrect. Mr Shepherd states very little in connection with this item. He does however state that the requirements of the BCA have not been met. Mr Ransley does not address Mr Shepherd's evidence. He impliedly concedes the omission of 'apron flashing' but acts as an advocate in stating that there is no evidence of water penetration. I prefer Mr Shepherd's evidence in connection with this item. 11. 6.8. Downpipes serve >12m of Gutter. Mr Shepherd has provided an extract from part 3.5.2.5 of the BCA which states that downpipes must not serve more than 12m of gutter. He states that because downpipes serve more than 12m of gutter at the front corners of the residence, an additional two downpipes are required. Mr Ransley does not address part 3.5.2.5 of the BCA as referred to by Mr Shepherd. Instead he states that the gutters meet the BCA Performance Requirement P2.2.1 if they are installed in accordance with AS/NZS 3500.5. 12. The BCA is incorporated into New South Wales law by reason of the Environmental Planning and Assessment Act 1979 and the regulations to that legislation. AS/NZS 3500.5 does not form part of the law in New South Wales and it is not referred to in P2.2.1 of the BCA. I regard Mr Ransley's evidence in connection with this aspect of the owner's claim as descending into advocacy on behalf of the builder. Instead of addressing the issue raised by Mr Shepherd, Mr Ransley has created an argument to present an alternative case. 13. I prefer Mr Shepherd's evidence in connection with this item. He has provided a basis for a finding, which I make, that this aspect of the builder's work did not comply with the BCA. 14. 6.9 Rainwater head omitted at west wall. Conceded by Mr Ransley and said to be included in his costing for item 6.10. 15. 6.10. Leaf screen omitted at box gutter. Box gutter not straight and obstructed by roof tiles. Conceded by Mr Ransley. 16. 6.11 Downpipes not installed in a straight drop. Mr Shepherd states that the downpipes have not been installed as depicted by the contractual plans. Mr Ransley, does not address this issue except to say that variation in the design is a contractual issue. That comment misses the point and proceeds on the assumption that there was a variation. A failure to construct in accordance with the contractual plans is a breach of clause 38.1 of the contract. The builder does not raise a variation to the works in its written submission on this issue. I accept Mr Shepherd's evidence on this issue and find that the builder has breached clause 38.1 of the contract. 17. The necessary rectification work relating to paint spots and splatters on roof tiles, chipped roof tiles, builder's debris in gutters, screws obstructing downpipe outlet, upper roof spreader, flashings over rear lower roof, down pipes serving >12m of gutter, rainwater head omitted at west wall, leaf screen omitted at box gutter and downpipes not installed in a straight drop will be included in the work order. Soffit linings – amount claimed $5,400.12 1. Mr Shepherd has dealt with this item in paragraphs 7A to 7E of his report. There are a number of items of claim in this section. 2. Mr Ransley has responded in section 7 of his report. He has split the section into 3 sub items. It is more efficient to deal with this section using the sub items identified by Mr Ransley. He made a concession in connection with item 7.3. 3. 7.1. Soffit cladding below rear balcony no movement joint. Mr Shepherd has stated that in his opinion an expansion joint is required. While this might be his opinion, his evidence regarding the lack of an expansion joint will not form the basis for a finding that one or other of the warranties implied by section 18B of the Act or incorporated into clause 38.1 of the contract may have been breached. Mr Shepherd does not state whether there has been a breach of the BCA in connection with this item or specifically why an expansion joint was required. 4. 7.2 Soffit cladding over rear balcony. Mr Shepherd states that the soffit to the rear upper balcony level is 20mm out of level with the brickwork over a length which is not stated. While this fact may be correct, this evidence does not form the basis for a finding that one or other of the warranties implied by section 18B of the Act or incorporated into clause 38.1 of the contract may be breached. Mr Ransley states that the variation between the soffit and the brickwork is within tolerance. 5. 7.3 Gap between balcony brick column and fascia. Conceded by Mr Ransley. Given the minor rectification costs provided by the experts, Mr Ransley at $130.00 and Mr Shepherd at $111.25, this item of dispute ought to have been resolved outside the Tribunal. 6. The necessary rectification work relating to the gap between the balcony brick column and fascia will be included in the work order. Site and Drainage – amount claimed $1,601.46 1. Mr Shepherd has dealt with this item in paragraphs 8A to 8E of his report. There are a number of items of claim in this section. 2. Mr Ransley has responded in section 8 of his report. He has split the section into 2 sub items. It is more efficient to deal with this section using the sub items identified by Mr Ransley. He made no concessions in connection with section 8.3. 3. 8.1. Stormwater drains not excavated adequately. Mr Shepherd states that stormwater pipes sit above the ground to a limited degree and are prone to damage. He relies on BCA 3.1.2.5 and states that a minimum cover of 75mm is required. Mr Ransley states that BCA 3.1.2.5 makes no reference to soil cover. I note that 3.1.2.5 (c) of the BCA, not referred to by the parties, refers to 'cover to stormwater drains'. Mr Ransley refers to AS 3500.5 that indicates a cover of 50mm is required over pipes below paving. Mr Ransley has assumed that paving will be provided and that when that occurs a 50mm cover can be accommodated. 4. Once again, I regard Mr Ransley's evidence in connection with this aspect of the owner's claim as descending into advocacy on behalf of the builder. Instead of addressing the issue raised by Mr Shepherd, Mr Ransley has created an argument to present an alternative case. 5. I accept Mr Shepherd's evidence on this issue. I conclude that the builder is in breach of clause 38.1 of the contract as it has not complied with BCA requirements in connection with this item. 6. 8.2. Ground at rear not profiled to fall away. Mr Shepherd states that the ground around the perimeter of the premises does not fall away from the edge of the building as required by the BCA at part 3.1.2.3, which he has set out in his report. Mr Ransley makes the point that the BCA only applies to external finishes surfaces and that the surfaces around the site are unfinished. I accept this evidence. 7. The contract provides that no allowance was made to provide a concrete landing, tiling or decking to the rear of the premises. 8. The owner has not established that there has been a breach of clause 38.1 of the contract in relation to this item. 9. The necessary rectification work relating to stormwater drains not being excavated adequately will be included in the work order. Liquidated damages 1. The contract contains numerous provisions which are relevant to liquidated damages. I do not propose to set them out in these reasons for decision. They are set out in the builder's written submissions. 2. In his application the owner claims liquidated damages from 6 May 2013 to the resolution of his dispute with the builder at the rate of $30.00 per calendar day. There is also a claim for loss of rent at the rate of $350.00 per week from 6 May 2013 to the resolution of the dispute with the builder. 3. In his written submissions, the owner's solicitor calculates liquidated damages as $11,250.00 calculated from 3 June 2013 to 3 June 2014. The date for practical completion was said to be 3 June 2013. The date of practical completion was stated to be 3 June 2014. 4. The owner's case and position on liquidated damages is not highly persuasive. Even if the date for practical completion was 3 June 2013, there is not one piece of evidence referred to in the owner's written submissions to establish that the date of practical completion was 3 June 2014. The owner's statement does not address that issue. 5. The owner's case for liquidated is completely unsupported by evidence. The failure of the owner to establish by proper evidence a date of practical completion is fatal to a liquidated damages claim since there is no date when the calculation ends. 6. Perhaps more importantly, the date for practical completion is also crucial to a liquidated damages claim since that date is the date when the calculation commences. The owner has not taken adverse weather and the effect of special condition 47.1 into account in calculating the date for practical completion. 7. The builder has made detailed submissions on the issue of liquidated damages at paragraphs 85 to 92 of its written submission. These are not addressed in the owner's reply submissions. The builder's submissions rely on the evidence of Mr Andrew Mavin and the documents annexed to it which were included in exhibit 3. 8. The builder's submission is that construction commenced on 20 September 2012 and that the adjusted date for practical completion was 10 July 2013. The builder has put into evidence the Notice of Practical Completion which states that the construction works were practically complete as at 29 August 2014. 9. The builder concedes by way of its submissions that liquidated damages of $1,500.00 are payable to the owner. 10. I find that the owner has failed to make out a case for liquidated damages. He has failed to establish a date for practical completion and a date of practical completion. I prefer the builder's submissions and evidence as regards practical completion. However as a consequence of the builder's admission, I will make an order in the owner's favour that the builder must pay him the sum of $1,500.00. 11. As regards the owner's claim for loss of rent at the rate of $350.00 per week from 6 May 2013 to the resolution of the dispute with the builder, I note that the owner's solicitor makes no submission in support of the claim. There is also no evidence in support of the claim. 12. This aspect of the owner's claim has not been established. I dismiss it. Best Promotion Pack 1. In the application the owner claimed reimbursement of $15,218.60 in connection with a 'Best Promotion Pack' purchased by him as part of the contract. 2. The owner's solicitors failed to provide submissions in support of the claim in their written submissions. This lead the builder's solicitor to assume that the owner had abandoned his claim in connection with the 'Best Promotion Pack'. 3. In his reply submissions the owner's solicitor stated that the owner had not abandoned his claim in connection with the 'Best Promotion Pack'. 4. The respondent has been denied the opportunity to make submissions on this aspect of the owner's claim by reason of the assumption made about the abandonment of the claim. While that is understandable, I have formed the view that I must give consideration to the claim. 5. The respondent could have made submissions to state its position on the point in any event. Further, the owner's solicitor's submissions on the issue are very brief. He does however confirm that the owner seeks an adjustment in his favour for $6,880.00 from the amount still payable by him to the builder 'to finalise the contract'. The effect of this submission is that the amount claimed under this head of claim has reduced from $15,218.60 to $6,880.00. The owner's solicitor does not state what the sum of $6,880.00 relates to or, importantly, the basis of the owner's claim for an adjustment in his favour of $6,880.00. I note that the amount paid for the Best Promotion Pack package was $6,880.00. 6. A document bound into the contract titled New Home Contract listed at item 2 'Promotion' and then stated 'Provide the January 2012 Best Promotion package for Designer Double Storey Homes.' I find that this document is a contract document. The contract price of $419,115.00 included the sum of $6,880.00 in relation to the Best Promotion package for Designer Double Storey Homes. 7. The January 2012 Best Promotion Package for Designer Double Storey Homes (the 'package') was tendered as exhibit 3. The relevant page of exhibit 3 stated 'Pay $6,880.00 and receive over $57,000 of Luxury Upgrades!' 8. The owner's evidence includes an account of his dealings with the builder's tile supplier in connection with the package. 9. The gist of the owner's evidence it in connection with tiling is that the builder's tile supplier failed to make it clear to him and his partner which tiles were included in the builder's package. As a result the owner ordered porcelain tiles for the residence when the builder's package only related to ceramic tiles in relation to the entry, the kitchen, pantry, dining and family rooms. 10. I note that the relevant item of the package states after reference to the areas in the preceding paragraph, '(Select from our specially chosen promotional package)'. 11. The owner has stated in connection with the package that he was told that he had to pick tiles from Di Lorenzo Tiles and could not choose from another supplier. I accept that evidence. 12. The owner's evidence includes evidence of his partner's actions in going to Di Lorenzo Tiles to select tiles. He was in Western Australia working at the relevant time. 13. Upon his return from Western Australia the owner with his partner returned to Di Lorenzo Tiles to finalise their tile selection. His evidence was that it was his intention to choose tiles from the builder's range of tiles, its specially chosen promotional package. He and his partner saw a Di Lorenzo employee who was different to the person his partner had originally spoken to. None the less his evidence is that they were shown a range of tiles which were not in the builder's standard range, but he was not informed of that fact. He also states that at this meeting the Di Lorenzo employee had the contract to hand. The inference to be drawn from this, in my view, is that the Di Lorenzo employee was aware that the owner was in contract with the builder. 14. The owner's evidence is that he and his partner made their final tile selections which were chosen from 'the DC polished Porcelain range'. He also states that he was told by the Di Lorenzo employee that he would be charged for coloured grout and some tiles which were 'much larger'. I accept this evidence. 15. The evidence of Mr Mavin on behalf of the builder addresses this point briefly. He makes it clear that the costs the owner is seeking relates to the cost of what he describes as upgrading to porcelain tiles. 16. At this point in these Reasons for Decision, it is possible to ascertain the factual background to this head of dispute and to make any necessary findings of fact. However, the owner by his solicitor does not state the legal basis upon which his claim for a credit of $6,880.00 depends. 17. It is not for the Tribunal to formulate the owner's cause of action to form the basis of this item of his claim. In conformity with section 38(5)(c) of the Civil and Administrative Tribunal Act 2013, the Tribunal has, by allowing adequate time for the provision of written submissions, ensured that the owner has had a reasonable opportunity to have his submissions considered in these proceedings and to explain the basis of his claims and why they ought to be successful. 18. In the absence of knowing or being informed by the owner of the legal basis upon which this head of claim is advanced, I am unable to consider that matter having regard to the relevant facts and to make an order in the owner's favour for the amount claimed of $6,880.00. 19. This item of the owner's claim is therefore dismissed on that basis. COSTS 1. Either party is at liberty to make a costs application in these proceedings. 2. Any costs application pursuant to section 60 of the Civil and Administrative Tribunal Act 2013 or rule 38 of the Civil and Administrative Tribunal Rules 2014 must be lodged in the Tribunal and served on the costs respondent within 21 days of the date of this order either attaching or referring to the documents relied upon in support of the application. 3. The costs respondent will have 21 days after the date of receipt of the costs application referred to above, to lodge in the Tribunal and serve on the costs applicant the submissions, if any, in response to the costs application, such submissions either attaching or referring to the documents relied upon. 4. The cost applicant will have 14 days after the date of receipt of the cost respondent's submissions to lodge in the Tribunal and serve on the costs respondent the submissions, if any, in reply, such submissions either attaching or referring to the documents relied upon. 5. The Tribunal will determine any costs application on the basis of the papers lodged in the Tribunal D Goldstein Senior Member Civil and Administrative Tribunal of New South Wales 28 October 2014 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: 13 March 2015