Despite three recent Supreme Court decisions – there is still much confusion about what licence(s), if any, are required under the Queensland Building and Construction Commission Act 1991 (Qld) (QBCC Act) to carry out civil, infrastructure and subdivision works. What is clear is that if you carry out “building work” (as defined in the QBCC Act), without an appropriate licence:
- it is an offence; and
- you are not entitled to any monetary or other consideration.
Three recent Supreme Court decisions offer some much-needed clarity on the scope of “building work” as that term is defined in the QBCC Act and the exemptions contained in Schedule 1 to the Queensland Building and Construction Commission Regulation 2018 (Qld) (QBCC Regulation). However, one Judge remarked that an urgent review of the definition of “building work” was required.
Galaxy Developments Pty Ltd v Civil Constructors (Aust) Pty Ltd t/a CCA Winslow
Most recently, the decision handed down in Galaxy Developments Pty Ltd v Civil Constructors (Aust) Pty Ltd t/a CCA Winslow & Ors [2020] QSC 51 rendered a $1.3 million civil works contract void where the Court found the contractor did not hold the requisite licence to carry out what the Court described as “very minor works” under the contract despite the contractor holding a licence in the class of “Builder – restricted to structural landscaping”.
The question before the Court was whether the landscaping licence held by the contractor was appropriate for the work performed or whether the work was exempt under the QBCC Regulation. If not, the claimed amount could not be recovered under the contract.
The minor works performed by the contractor included:
- the removal of a metal garden-style seat fixed to the concrete footpath;
- relocation of a prefabricated metal shelter with a metal bench seat attached to its back wall; and
- relocation of a tubular piece of metal being used as a bike rack.
Dalton J held that the removal and the replacement of the prefabricated metal shelter was within the scope of the licence class held by the contractor. However, her Honour determined that the removal and replacement of the bike rack and bus shelter seat was not work within the scope of the contractor’s licence and this work voided the whole of the $1.3 million contract.
In doing so, her Honour:
- rejected the exemption for “work on busways and tunnels”; and
- took a strict approach to the interpretation of Item 15 of Schedule 1 to the QBCC Regulation which exempts works on bikeways and footpaths (including the construction, maintenance or repair) from the definition of building work, determining that the exclusion did not extend to structures in, on or under footpaths such as the bus seat.
Her Honour described the situation to be “absurd in reality” and called for a review of the legislation to ensure contractors can fairly recover payment for works performed under contract. Until then, contractors must remain vigilant in ensuring that they hold the appropriate licence(s) for any “building works” to be performed under the contract, or risk non-payment entirely.
Waterford PPG Pty Ltd v Civil Constructors (Aust) Pty Ltd
On the other hand, and perhaps providing a glimmer of hope to contractors in Queensland, the decision earlier this year in Waterford PPG Pty Ltd v Civil Constructors (Aust) Pty Ltd [2020] QSC 8 narrowed the scope of what will constitute “building work” for the purposes of the QBCC Act, at least for work pertaining to water reticulation system, sewerage system or stormwater drains.
In this case, Waterford contended that the contractor’s installation of sewerage pump chambers and the supply of the branch connections to the trunk infrastructure constituted a fixed structure and therefore fell within the definition of “building work” under the QBCC Act.
In the Court’s decision, Justice Boddice rejected this argument and held that the tank did not, on its own, constitute a structure which would fall within “building work”, and further that “at the time of the contract between the parties, no proposed building was identified and accordingly it cannot be said that the respondent undertook to do works to connect a particular proposed building to a main”. Importantly, the Court found that although it is inferred that the lots will ultimately contain buildings, the work undertaken by the contractor did not involve works connecting a particular building or proposed building to the main of the system in which it was contracted to construct, noting that at the time of the works, there was not even in existence the proposed subdivided lots.
Hardev Property (Dev 10) v Palmgrove Holdings Pty Ltd
In The Trustee for Hardev Property (Dev 10) v Palmgrove Holdings Pty Ltd & Others [2019] QSC 208 (Hardev Property) the Court held that sewer connection and reticulation works were not “works connected to a proposed building” and therefore also fell within the exclusion contained in Item 11 of Schedule 1 to the QBCC Regulation so that a licence was not required.
In Hardev Property, the Court also clarified that it is not an offence under section 42(1) of the QBCC Act to enter a contract for “building work” provided that the “building work” will be carried out by a licenced subcontractor. Refer to our previous update for our summary of Hardev Property.
Other Cases
Other cases have found that the following is “building work” and a licence is required, or the contract is void (some were decided prior to the exemptions in schedule 1):
- private roads;
- installed agricultural pipe;
- footings; and
- piling.
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