Canweb Printing Pty Limited v Stodulka & Anor [2004] ACTSC 36 (31 May 2004)

Last Updated: 23 June 2004

CANWEB PRINTING PTY LIMITED v ANDREA STODULKA

and DECOIN PTY LIMITED [2004] ACTSC 36 (31 May 2004)

BUILDING AND CONSTRUCTION - flood damage to premises - whether caused by negligent design and construction.

Bryan v Maloney [1995] HCA 17; (1995) 182 CLR 609

Voli v Inglewood Shire Council [1963] HCA 15; (1963) 110 CLR 74

Lynch v Brzozowski [1997] ACTSC 44

No SC 520 of 1998

Judge: Connolly J

Supreme Court of the ACT

Date: 31 May 2004

IN THE SUPREME COURT OF THE )

) No SC 520 of 1998

AUSTRALIAN CAPITAL TERRITORY )

BETWEEN: CANWEB PRINTING PTY LIMITED

Plaintiff

AND: ANDREA STODULKA

First Defendant

AND: DECOIN PTY LIMITED

Second Defendant

ORDER

Judge: Connolly J

Date: 31 May 2004

Place: Canberra

THE COURT ORDERS THAT:

1. There be judgment for the defendants with costs.

1. This is a claim for damages for property damage that was said to have occurred over the night of 25/26 November 1994 when the premises occupied by the plaintiff became subject to flood damage. The premises were located in Mitchell in the Australian Capital Territory, and were designed and built by the defendants in 1988 and 1989. Although built and approved as a warehouse, the premises were used by the plaintiff as a printing factory.

2. It is the plaintiff's case that during the night of 25/26 November 1994 there was a heavy thunderstorm with extensive hail, and that the premises flooded due to a combination of poor design in relation to the guttering and stormwater pipes, a crushed stormwater pipe under the concrete floor of the premises and the installation by the defendants of inappropriate covers on the stormwater inspection sumps within the building which, it is common ground, were at the time of the incident made of unsecured plywood rather than steel and fixed by bolts. It is claimed that much of the damage occurred due to the unsecured plywood sump covers being pushed up and off by the flow of water, allowing the stormwater to flood over the factory floor area, causing damage to computer equipment and paper stocks.

3. The defendants deny liability on all grounds. They say that there is no evidence of exceptional rainfall or hail on that evening and that the design of the building was appropriate. They deny that they installed plywood covers on the inspection sumps. They maintain that they installed the appropriate steel covers, and that such covers were necessary for a warehouse area designed so that heavy vehicles could enter and drive over the concrete floors and inspection sumps. They state that the building would never have been approved if it had contained light plywood covers. They assert that, after the plaintiff went into occupation, someone has removed the steel covers, and replaced them with the plywood covers. There is evidence that the plaintiff's use of the warehouse had involved, without apparent approval, the construction of additional internal partitioning and installation of reticulated water piping to various items of machinery and plant within the area affected by the flood without any drainage facilities to remove the water. The defendants invite me to draw the inference that the metal sump lids might have been removed to enable surplus water to be removed by way of draining it into the stormwater drainage system.

4. The matter was listed to commence before Justice Gray on 27 June 2003, but was adjourned at the request of the defendants, with the defendants paying the costs thrown away by reason of that adjournment. The hearing commenced before me on 16 December 2003 and ran to 18 December 2003, when it was adjourned part heard, resuming on 27 April 2004, when it was concluded.

5. There was agreement between the parties that, should liability be established, damages were agreed in the sum of $73,525 reflecting the cost of damage to certain computer items, paper stores, and clean up costs. The real issue between the parties was liability. There was little dispute concerning the relevant legal principles to be applied in determining liability. It was common ground that the first defendant was the builder of the premises and held the relevant building permit, and the second defendant was the designer of the building. A builder and designer will be liable for damage suffered by the first lessee of premises caused by the negligent design or construction of the premises, where that damage is reasonably foreseeable: Bryan v Maloney [1995] HCA 17; (1995) 182 CLR 609 at 617, Voli v Inglewood Shire Council [1963] HCA 15; (1963) 110 CLR 74 at 85. The principles have been applied in this Court in respect of the non-delegable duty owed by the holder of a building permit to ensure that building work was carried out with reasonable care in Lynch v Brzozowski [1997] ACTSC 44 per Miles CJ.

6. The defendants acknowledge the presence of a duty of care, but deny that, on the facts, the duty of care was breached.

The mechanism of the damage

7. The evidence of witnesses for the plaintiff, which is not in dispute, is that the premises were locked up and left by its employees some time after 5 pm on the evening of Friday, 25 November 1994. When the first employee arrived at work the next morning, at around 7 am, he found that the premises had been inundated by water, causing damage to computer equipment and paper rolls. The premises are part of a complex of buildings, with the adjoining buildings being occupied at the time as warehouse facilities by the National Museum and a retail chain. There was no evidence of any flood damage being sustained by either of the identical units on either side of the subject premises.

8. The plaintiff opened its case on the basis that the combination of the heavy thunderstorm and hail and the inadequate design of the gutters and downpipes, together with the inappropriate use of unsecured wooden sump covers lead to flood damage due to the high volume and pressure of stormwater and hail forcing the plywood sump covers off, allowing the water to inundate the floor. The plaintiff also opened on the basis that some water overflowed the box gutters and flowed down the walls.

9. The defendants' case was that, if the cause of the water was found to be from a thunderstorm, the most likely explanation was that the water flowed from a sump cover that had either been removed by an employee of the plaintiff or was forced off due to someone in the plaintiff's organisation replacing the secured steel covers with the wooden covers, presumably to facilitate easy access to the stormwater system to remove waste water. The defendants lead evidence that moisture seen by an employee of the plaintiff on the walls on the Sunday morning was more likely due to condensation from the water on the floor, the building being of an unusual single skin construction which, in warm weather and over a day, would permit such condensation if there was a volume of water on the floor. Mr Stodulka said the building was designed and built as a warehouse, where a single skin construction was appropriate, and not as a factory, where such a method of construction would not be appropriate.

10. Mr PJ Kelly, then an employee of the plaintiff, was the first person on the premises on the Saturday morning, and he said that he observed two sumps without their plywood lids, the lids having moved some distance away from the sumps. He observed significant water damage and extensive puddling. He gave evidence that he was in the premises on another occasion some time after this incident and he observed during a heavy storm the plywood lid to a sump cover being pushed off by water pressure. Mr Kelly did not refer to water on the walls.

11. Mr RT Brown was the press and publishing manager for the plaintiff. He arrived at the premises on the Sunday, having been called in from a weekend away from Canberra. He said that the manhole covers were off, and water was still puddled over the floor. He observed that the rear wall of the building was still wet. In cross-examination he described this as being moisture in the concrete, the concrete being "just wet" with no water running. He agreed that it was a warm weekend. Meteorological data tendered in the defendants' case shows a maximum temperature on Saturday, 26 November 1994 of 33.5°C, which is consistent with Mr Stodulka's version of events.

12. There was another possible source of the water, put forward in the defendants' case. This was the suggestion that one of the taps in the factory area could have been left on overnight inadvertently by an employee. This was expressly denied by Mr Kelly and Mr Brown. The only evidence leading to this source of water was a schedule of water consumption for the building, which included the subject premises as well as the other tenants, which showed a significant spike in water consumption for the three month period including the date of the flood. Mr Brown was unable to offer any explanation as to why more water would have been consumed in this period, but of course it is the case that the water use would cover all three tenancies. It seems to me that there is insufficient evidence to enable me to draw an inference that the source of the flood was a tap left on in the factory premises.

13. On all the evidence I am satisfied that, on the balance of probabilities, the mechanism for the flooding was that water entered the building by flowing up from the inspection sumps in the stormwater system. This occurred, it seems to me, either because the sump covers, made of plywood, were left off the sump, or because the plywood sump covers lifted due to the water pressure, and that the water then pushed the covers up and away from the sump, allowing the water to flow across the floor areas of the building. It seems to me that this is the most likely explanation for the presence of water on the floor observed by Mr Kelly on the Saturday. I am satisfied that the moisture on the rear wall observed by Mr Brown on the Sunday was caused by condensation. I am not satisfied on the balance of probabilities that water flowed down the walls from the box gutters.

The extent of the storm.

14. There was no evidence from any person who may have witnessed the storm on the evening of 25 November 1994, so there was no direct evidence as to its intensity. An expert report dated 20 December 1994 tendered in the plaintiff's case from Mr JL Dossetor, a consulting engineer, states that -

The Bureau of Meteorology report for the 25 Nov 94 notes that hail blanketed many areas of Belconnen: the actual rainfall intensity was not recorded because of the isolated nature of the storm.

15. In cross-examination Mr Dosseter acknowledged that this was not based on any written report from the Bureau of Meteorology, but on a conversation he claims to have had with an employee of the Bureau. He was shown a report, tendered in the defendants' case, from the Bureau of Meteorology showing the rainfall data collected by the Bureau at their official recording sites at Ginninderra, Hall and Mitchell for the relevant dates. These showed 8.4 mm at Hall, and 9 mm for Mitchell on 26 November 1994, being the 24 hours to 9 am that date, which covers the evening of 25 November 1994. The Ginninderra station showed 40.2 mm over a 72 hour period to 9 am on 28 November 1994. The data also states for 26 November "small hail also reported in Belconnen".

16. These rainfall figures do not suggest particularly heavy or unusual storm activity. The defendants included in their tender official Bureau of Meteorology data showing other rainfall data for what was described as "significant thunderstorm events" in Canberra between 1989 and 1998. Of significance were recordings of significant rainfall at Mitchell of 65 mm on 4 January 1993, 53.4 mm on 5 March 1992, 36 mm on 14 November 1993 and 31.4 mm on 1 January 1992. There is no explanation as to why such heavy falls caused no flood damage to these premises, when the significant damage is said to have been caused by a storm which was only recorded as generating 9 mm of rain at the Mitchell station on this date. To the extent that the plaintiff's case is based on claimed deficiencies in the gutter design on the building, it is hard to see how such deficiencies, if established, would lead to significant flooding on an occasion of moderate rainfall, and no flooding on days when data from the Bureau's nearest recording station in that suburb shows far heavier rainfall. It also fails to explain why flooding would occur only in this unit.

17. I am not satisfied, on the balance of probabilities, that there was a significant thunderstorm on the evening of 25 November 1994. I am satisfied that there was rain on this evening, but of a significantly lower intensity than rain that had occurred on previous occasions, which caused no flood damage. This finding is consistent with my finding that the cause of the water damage was water escaping from a sump, due either to the cover being removed, or being lifted by water pressure, rather than coming down the walls as a consequence of an overflowing gutter. It seems to me that the plaintiff has failed to show that there was sufficient rainfall this evening to have caused any overflow from the gutters.

The plywood sump covers

18. It is common ground that plywood covers for a stormwater inspection sump within a building of this type would be an entirely negligent form of construction. This stands to reason. The building was constructed as a warehouse with large front doors to enable semi-trailers to enter fully laden. It was also anticipated that forklifts would operate within the building. Mr Stodulka said that for these reasons it was necessary for any opening in the floor by way of an inspection sump for stormwater to have a secure cover so that heavy vehicles could safely travel over the cover. He said that the covers he installed were heavy gauge steel, and they were bolted on. He said that this was the condition of the premises when they were inspected.

19. That a cover in the floor of a warehouse would need to withstand heavy traffic is abundantly clear. In cross-examination Mr Brown said that the plaintiff would cover the plywood covers with a steel plate on occasions when a forklift needed to operate within the premises (T 36). This evidence, it seems to me, shows a knowledge by the plaintiff that plywood covers were inappropriate. The real question here is who installed the plywood covers?

20. Mr Kelly said that there were wooden covers on all three sumps when he commenced working at the premises (T 28). He denied that metal covers were ever put on (T 28). This is in conflict with Mr Brown's evidence of the use of a metal cover over the wooden cover when a forklift was operated. Mr Brown said that when he first attended at the premises, which was in mid-1989, there were wooden covers over all four sumps (T 32). He said, "The lids weren't secure, you could lift them out" (T 32). This is consistent with Mr Kelly's evidence that "You could just lever them out" (T 18). Mr Kelly was asked in cross-examination (T 18) -

And you could pour things down it couldn't you? I mean...?- - - You could if you wanted to.

If you had a water problem you could just tip your water into it? - - - Yes, you could.

21. It seems from this evidence that both Mr Kelly and Mr Brown were familiar with lifting off the plywood lids. Clearly, the use of the stormwater system for disposal of waste water within a factory is inappropriate, a fact acknowledged by Mr Kelly (T 18), who said that industrial waste water went into a sewer line. The plans of the factory, and the photographs tendered in the case, did not show any sewer line within the rear area of the premises, or any temporary plumbing or lines to achieve this admirable goal. The evidence, it seems to me, goes to support the inference that the plaintiff's employees from time to time would lift the wooden covers and access the stormwater lines. Mr Brown knew that the wooden covers would not support the weight of a forklift, and a steel plate was used as a temporary cover over the wooden covers when heavy equipment was operating. This seems to suggest that there was some ongoing benefit to the plaintiff in having wooden sump covers that were easy to lift up for other purposes.

22. Mr Brown said that there had been other persons associated with the plaintiff in the premises when he first commenced work with the plaintiff, and was adamant that the sump covers were all made of plywood (T 192). There were four sumps within the building and there is a discrepancy between the evidence of Mr Kelly who said that three sump covers were plywood, and Mr Brown who said that all four were of wood. There is a photograph in evidence which indicates one sump cover was of steel. It was put to Mr Brown that the plaintiff had replaced the original steel plates with the plywood covers, and he replied, "Why would we do that?" (T 192). When it was put to him that this would make it easier to access the stormwater drains to get rid of waste, he said no, but when it was specifically put to him that the plaintiff's employees removed the steel covers he said, "To the best of my knowledge, no".

23. Mr Stodulka gave evidence that he was involved in the design and construction of the premises. The second defendant is an entity with which he was associated. He said that he has been involved in many projects over 35 years in the construction industry, and is clearly an experienced builder and engineer. He said that when internal inspection pits for stormwater are constructed (at 183) -

... you would be bound by common sense, current engineering practice, occupational health and safety regulations. You would be placing a steel cover over it or a steel plate over it which would be bolted down into the sides of the sump. Bolted or screwed down."

24. He said that he always followed this practice, and said that it would be "foolish and foolhardy to do anything else" (T 183).

25. He said that he saw the steel covers in this building (T 184). Asked whether he authorised the removal of the steel plates, he said (T 184) -

I certainly would never authorise removal of steel plates in an area that was trafficked by both fork lifts carrying paper rolls in this particular case of in excess of 600 kilograms each, trucks driving over it and it would just be foolhardy to change it for any particular reason at all.

26. He gave evidence that the other premises in the complex have steel plates.

27. Mr Stodulka said that he only became aware that the covers were not of steel when he entered the premises on an inspection visit after this litigation commenced in July 2000. He said that on that inspection he observed that, while there were still steel sump covers outside the building, and at one point within, others had been replaced with plywood.

28. Mr Stodulka was shown photographs of the internal fit-out installed by the plaintiff including piping, which he said he did not design or install (T 178-179). He observed tap inlets and connections to the rear of the building, and said (T 178) -

One of the unfortunate features of this building was that it was 54 metres from the front of the building to the back of the building, and it was just not practical even at the pre-design stage to introduce a drainage system that would take any waste water to the front.

29. I am satisfied that the plaintiff had, after going into occupation, installed water inlets to areas in the rear of the building, but that there was no apparent system in place to drain any waste water generated by the use of these inlets.

30. Mr Stodulka also gave evidence that, when he made his inspection, he was surprised to find that in the inspection sump near the area where machines were operating, someone had poured some concrete into the inspection pit to bring the floor of the pit level with the stormwater pipes. There was a photograph showing this sump which clearly shows the concrete. The normal design of the pits, and the design he adopted, has the sump, which is a box like construction with a floor lower than the entry and exit point of the stormwater to allow debris to settle and to facilitate inspection. He said that this was not how he constructed that pit, and the only reason for the modification would be to facilitate the use of the sump to pour waste water, and to avoid that water forming a pond in the base of the sump.

31. Mr GW Shoebridge was an engineer who gave expert evidence for the defendant, mainly in the context of the adequacy or otherwise of the guttering and downpipe design. He has served as the ACT Building Controller, and was asked about the normal form of cover for an inspection sump within a warehouse. He said (T 269) -

With a warehouse building I understand that the potential loadings are fairly intense and so I would expect that it would be either certainly a - a solid material such as a steel checker plate or a concrete slab, something that - that would be able to resist significant wheel loadings.

32. In cross-examination he confirmed that good building practice would require metal lids secured in place, and that plywood lids would be inappropriate (T 289). He accepted that unsecured plywood covers would allow water to escape from the stormwater system (T 289). He also said in cross-examination that he could not say what was in place at the time the certificate of occupancy was issued, but that from his observations on the site, the construction and finishing treatment on those sumps that did have secured steel lids in place was similar to those that had the plywood lids in place, and he concluded that (at T 288) -

what I saw was for a provision of those plates to have been in place. The recess was about the order of six to eight millimetres. It wasn't in the order of 20 millimetres, for example.

33. On all the evidence I am not satisfied that the defendants were negligent in designing and constructing these premises in such a manner that plywood sump covers were placed in certain locations within the plaintiff's premises only, whereas appropriate secured steel lids were in place throughout the other units, and in parts of the plaintiff's premises. I accept the evidence of Mr Stodulka on this point. I accept Mr Kelly's evidence that throughout his term at the premises the plates were of plywood, and I note that his evidence seems to acknowledge that the plaintiff's employees did lift the covers from time to time. The only reason to lift the cover, it seems to me, was to allow waste water to be introduced to the stormwater system. I note that alterations were made to the premises which involved the introduction of water by way of piping it to the rear of the premises with no provision for underground drainage to the sewer system. I am not satisfied, on the balance of probabilities, that the defendants designed and installed plywood lids for these sumps. I am satisfied that the defendants designed and installed steel lids, and indeed the obvious need for such a cover leads me to the view that these must have been in place when the premises were approved for occupation.

34. As I am satisfied that the cause of the flooding that caused the damage on the evening of 25 November 1994 was water escaping from the stormwater inspection sumps that had an unsecured plywood lid, due to the lid either lifting from water pressure or being left off, my finding that I am not satisfied that the presence of the plywood covers was the fault of the defendants means that there should be judgment for the defendants. The plaintiff has not made out its case that the flood damage, which I have found was due to stormwater from a moderate rainfall event entering the warehouse floor through the inspection sump, was due to any negligence on the part of the defendants.

The box gutter and downpipe design.

35. There was extensive evidence by way of report and examination-in-chief and cross-examination concerning the adequacy of the box gutter roof system, and associated downpipes. Mr Dossetor, an experienced engineer, was of the view that the design was inadequate in that it did not comply with certain design standards. Mr Shoebridge, also an experienced engineer, was of the view that the design was adequate to meet any foreseeable rainfall event in Canberra. Both were impressive witnesses. It seems to me that it is not necessary for me to resolve this dispute between the experts. I have found that the flooding occurred, not by way of ingress of water from the roof by way of an overflow from the box gutter and down the rear wall, but by way of the escape of water from the inspection sumps. I have found, in effect, that the box gutter was not the cause of the flood, and it follows that, even if it were designed in a manner not in accordance with an approved code, which was Mr Dossetor's view, it would not matter, because it was not causally linked to the flooding.

36. Mr Shoebridge gave evidence that, although the design did not accord with common practice, it was sound from an engineering perspective, and he provided extensive calculations to show that the novel design features (which involved a narrower than usual diameter of gutter with the associated use of rain heads) was sufficient to meet a one in 100 year rain event (T 287). It seems to me that, without any finding on which is the better view, it is sufficient for me to find that I am not satisfied that the plaintiff has established any deficiency in the design or construction of the box gutter and downpipe that has contributed to the flood event of 25 November 1994.

37. Mr Dossetor's view that the box gutter and downpipe design and construction was deficient does not, it seems to me, plausibly explain why it was that the flood event occurred on this evening, and not on other days when there was, on Bureau of Meteorology evidence, considerably greater rainfall. An inadequate box gutter could, on heavy rain, give rise to an overflow which would lead to the ingress of water by water flowing over the gutter and down the rear wall of the premises. It stands to reason that this process would be more likely to occur with heavy rain than moderate rain.

38. Moreover, the box gutter and rain head designs in place were approved by the ACT building authorities, and occupancy certificates issued, which, while not conclusive, go towards the view that the design, while differing in some ways from normal practice, was adequate to meet foreseeable rain events.

The damaged pipe

39. There was evidence that some years after this flooding a camera inspection found that part of the under floor PVC stormwater pipe was damaged, in that it was distorted. Although the plaintiff seeks to rely on this in support of its case, there are a number of difficulties. The evidence that the pipe was distorted in 1997 does not necessarily indicate that it was distorted in 1994. Moreover, there is no evidence as to the cause of distortion, beyond an inference that it occurred during the pipe laying process. Again, there is no evidence of the defendants' negligence beyond an inference. Moreover, I am not satisfied that, even if the pipe was damaged due to the defendants' negligence at the time of construction, such an event caused the subject flood. Mr Shoebridge gave impressive evidence that a distortion such as that found in this pipe would not affect the flow of water.

Order

40. I order that there be judgment for the defendants with costs.

I certify that the preceding forty (40) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, Justice Connolly.

Associate:

Date: 31 May 2004

Counsel for the plaintiff: Mr K Odgers

Solicitor for the plaintiff: Hunt & Hunt

Counsel for the defendants: Mr V Bizannes

Solicitor for the defendants: Ken Cush & Associates

Dates of hearing: 16, 17 and 18 December 2003 and 27 April 2004

Date of judgment: 31 May 2004