Monsour v C & R Darvill Pty Ltd [2026] QCA 3

Michael Creedon  |  Charlotte Gordon  |  RJ Serrano

Key takeouts

This case considered the operation of s 84 of the now repealed Domestic Building Contracts Act 2000 (Qld) (DBC Act) (replaced by Schedule 1B of the Queensland Building and Construction Commission Act 1991 (Qld) (QBCC Act)).  Section 84 operated as a safety net for building contractors who verbally agreed to undertake variations in residential construction, without the paperwork the legislation required.  The safety net operated in exceptional circumstances only and was to prevent owners refusing to pay for variation work on the basis that formal documentation had not been issued.

The QBCC Act does not contain a provision in the same terms as s 84 of the DBC Act.  Although, s 40 of Schedule 1B of the QBCC Act provides that it is a defence for a building contractor to not document a variation in accordance with the QBCC Act if the variation was required to be carried out urgently and it was not reasonably practicable to produce a copy of the variation in writing before carrying out the work.

In practice, builders should document variations carefully and in accordance with the requirements of the QBCC Act and contract.  Builders should not look to rely on historical or existing legislative provisions governing domestic building works as a substitute for proper contract administration.

Facts

Background

In December 2014, Marie and Bruce Monsour (owners) contracted with C&R Darvill Pty Ltd (builder) to undertake substantial renovations to a Brisbane property (contract).  The contract price was $1,407,268 (excluding variations).  Works commenced in January 2015, and practical completion was due in February 2016.

During the project, the builder claimed numerous variations. The owners paid the first 11 progress claims issued by the builder but refused to pay Progress Claim 12. By late June 2016, both parties issued termination notices.  In March 2018, the owners commenced proceedings in the Civil and Administrative Tribunal (QCAT) to recover overpayments to the builder.  The builder counterclaimed for unpaid monies in respect of the building works.  Four days before the hearing, the builder amended its counterclaim to include reference to s 84 of the DBC Act.  Section 84 allowed a building contractor to recover the cost of variations in circumstances where it had not complied with the DBC Act, but exceptional circumstances existed conferring an entitlement on the building contractor to recover those costs.

On 27 July 2022, QCAT published its primary decision, by which it rejected the owners’ claims for overpayment.  The Tribunal ordered the owners to pay the builder $134,407 comprising the balance of outstanding progress payments and $99,163 for unpaid variations, which were allowed under s 84 of the DBC Act on the basis that exceptional circumstances were established.

QCAT found that the progress of the works was significantly affected by the owners’ failure to provide owner‑supplied goods and services and by ongoing interference with the works.  QCAT also found that the owners excluded the builder from the site in April 2016, amounting to repudiation and entitling the builder to terminate the contract.

QCAT appeal

The owners appealed to the QCAT Appeal Tribunal on several grounds, including challenges to:

• the late amendment permitting the builder to rely on s 84 of the DBC Act;
• the adequacy of reasons for allowing that amendment;
• the finding of exceptional circumstances; and
• various procedural fairness issues.

The QCAT Appeal Tribunal rejected or refused leave in respect of the interlocutory and procedural grounds, found no error in the exceptional circumstances finding, and dismissed the appeal.

The owners then sought leave to appeal to the Court of Appeal.

Decision

The Court of Appeal refused leave to appeal.

Section 150(3) of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) requires that any appeal from the QCAT Appeal Tribunal to the Court of Appeal may only be made on a question of law and only with the leave of the Court. The Court of Appeal will not revisit or evaluate factual findings, including whether exceptional circumstances existed, where QCAT and the QCAT Appeal Tribunal have found that recovery is justified on the evidence.

The Court noted that the QCAT Appeal Tribunal had made two errors of law regarding certain interlocutory issues, however, those errors were treated as immaterial because the QCAT Appeal Tribunal also rejected the underlying grounds of appeal on their merits, finding no error in the discretion to permit the s 84 amendment and no prejudice to the Owners.

On the exceptional circumstances ground, the Court observed that the Appeal Tribunal had reviewed the evidence and concluded that it was open on the facts to find that exceptional circumstances were established.  The owners’ attempts to recast that conclusion as a question of mixed fact and law were insufficient to engage the Court’s leave jurisdiction.

The Court rejected the remaining proposed grounds largely because they were poorly formulated and would have required the Court to engage with questions of fact rather than law, which fell outside the constrained appeal pathway from the QCAT Appeal Tribunal.

In reaching these conclusions, the Court reinforced an important practical reality for domestic building disputes.  Section 84 of the DBC Act may have provided a pathway for the recovery of non‑compliant variations where the overall project context, including persistent owner‑driven changes, interference and the practical difficulty of documenting variations, supports a finding of exceptional circumstances. The statute, however, did not excuse poor contract administration, but it recognised that rigid insistence on formal compliance would not always reflect how complex residential building projects are actually delivered.

The QBCC Act does not contain a provision in the same terms as s 84 of the DBC Act.  However, s 40 of Schedule 1B of the QBCC Act provides that it is a defence for a building contractor to not document a variation in accordance with the QBCC Act if the variation was required to be carried out urgently and it was not reasonably practicable to produce a copy of the variation in writing before carrying out the work.