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[2012] ZAECPEHC 76
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Stergianos v National Home Builder Registration Council (3853/10) [2012] ZAECPEHC 76 (16 October 2012)
13
IN THE HIGH COURT OF
SOUTH AFRICA
(EASTERN CAPE, PORT
ELIZABETH)
Case No. 3853/10
Dates Heard: 30 -31/7/12;
1-2/8/12
Date Delivered: 2/10/12
Date of amended order:
16/10/12
Not Reportable
In the matter between:
DOUKA PANAGIOTIS
STERGIANOS
................................................................
Plaintiff
and
NATIONAL HOME BUILDERS
REGISTRATION COUNCIL
............................................................................
Defendant
Housing Consumers
Protection Measures Act 95 of 1998
– liability of National Home
Builders Registration Council for the rectification of major
structural defects to consumer’s
home, in terms of
s 17(1)
of
Act – whether major structural defects proved.
JUDGMENT
PLASKET J:
[1] The
Housing Consumers
Protection Measures Act 95 of 1998
is consumer protection legislation
that is intended, inter alia, to protect home owners, in certain
circumstances, from the effects
of poor workmanship on the part of
home builders who are registered with the National Home Builders
Registration Council –
the NHBRC.
1
In this matter, the
plaintiff, Mr Douka Panagiotis Stergianos, has issued summons against
the NHBRC alleging that the defects evident
in his house are such
that the Act obliges the NHBRC, the defendant, to remedy them.
[2] The NHBRC is
established as a juristic person by
s 2
of the Act. Its objects are
set out in
s 3
and include representing ‘the interests of
housing consumers by providing warranty protection against defects in
new homes;
2
regulating the home
building industry;
3
providing protection to
owners of homes ‘in respect of the failure of home builders to
comply with their obligations’
in terms of the Act;
4
and ‘to establish
and to promote ethical and technical standards in the home building
industry’
5
.
[3]
Section 10(1)
of the
Act requires persons who carry on the business of home building or
who receive consideration from a home owner in respect
of the
construction of a home to register with the NHBRC as a home builder
and
s 10(2)
prohibits a home builder from constructing a home unless
he, she or it is registered as a home builder with the NHBRC. In
terms
of
s 12
, the NHBRC shall publish a Home Building Manual which
contains technical standards with which home builders are required to
comply.
Every home building contract is deemed to contain a number of
warranties which are enforceable by the home owner against the home
builder. They are that:
‘
(a) the
home, depending on whether it has been constructed or is to be
constructed-
(i) is or shall be constructed in a
workmanlike manner;
(ii) is or shall be fit for
habitation; and
(iii) is or shall be constructed in
accordance with-
(aa) the NHBRC Technical Requirements
to the extent applicable to the home at the date of enrolment of the
home with the Council;
and
(bb) the terms, plans and
specifications of the agreement concluded with the housing consumer
as contemplated in subsection (1).’
[4] In terms of
s 14(1)
,
a home builder may not begin to build a home before he, she or it has
submitted the prescribed documents, information and fee
to the NHBRC,
the NHBRC has accepted these and has entered this in its records and
has issued a certificate of proof of enrolment.
[5]
Section 15
deals with
the financial affairs of the NHBRC.
Section 15(2)
provides that it
may pay out of its funds ‘any amount contemplated by
s 17(1)
’.
In this way, it gives effect, subject to the terms stipulated in
s
17
, to its object of ‘providing warranty protection against
defects in new homes’.
[6]
Section 17(1)
of the
Act provides:
‘
(1) Subject
to subsection (2), the Council shall pay out of the fund established
for that purpose in terms of
section 15
(4), an amount for
rectification where-
(a) within-
(i) five years of the date of
occupation, a major structural defect has manifested itself in
respect of a home as a result of non-compliance
with the NHBRC
Technical Requirements and the home builder has been notified
accordingly within that period;
(ii) 12 months of the date of
occupation, a roof leak attributable to workmanship, design or
materials has manifested itself in
respect of a home and the home
builder has been notified accordingly within that period;
(b) the home builder is in breach of
the home builder's obligations in terms of
section 13
(2) (b) (i)
regarding the rectification of such defect;
(c) the relevant home was constructed
by a registered home builder, had been enrolled with the Council and,
at the occupation date,
the home was enrolled with the Council
subject to
section 14
(4), (5) and (6);
(d) the home builder no longer exists
or is unable to meet his or her obligations; and
(e) in the case of a home that has
been enrolled with the Council on a project basis in terms of
section
14
(2), the application has been made by the MEC pursuant to an
agreement in terms of
section 5
(4) (c).’
[7]
Section 17(2)
empowers the NHBRC to either reduce any amount that may be expended
in terms of
s 17(1)
, in exceptional circumstances, make a payment to
a home owner in full and final settlement instead of rectifying the
defect, or
refuse any claim.
[8] This action was
instituted in terms of
s 17(1)
of the Act in the circumstances that
are set out below.
[9] On or about 10 May
2005, Stergianos entered into a contract with Herrington Construction
CC, trading variously as Ring Civils
and Menziwa Building, in terms
of which Herrington Construction was to build a home for Stergianos
on erf 1392, Kleinkrantz, Wilderness
for a price of R578 757.49.
The home was duly constructed with, it must be said, a number of
difficulties along the way, and
Stergianos took occupation of it on
20 December 2005.
[10] During the course of
the first year of his occupation of the house, cracks began to
develop in the concrete floor slab. They
got progressively worse with
time and efforts to fill them came to naught as the cracks continued
to open. Stergianos turned to
his attorneys for help and a civil
engineer, Mr Retief Kleinhans, was instructed to determine the cause
of the cracks. His opinion
was that the cause was structural.
[11] Not having been able
to obtain satisfaction against the builder, Stergianos issued summons
against the NHBRC in terms of
s 17
of the Act, claiming orders
declaring that the NHBRC was responsible for the rectification of the
structural defects in the home,
directing it to rectify the defects
within 180 days and directing it to pay his costs.
6
[12] The NHBRC has
refused the claim made by Stergianos. All of the elements of the
cause of action set out in
s 17(1)
bar one have either been admitted
by the NHBRC or are not in dispute. The only element that is in
dispute, and which I have to
determine, is the cause of the defect.
If I find that the cracks in the floor slab are caused by a major
structural defect, Stergianos
will be entitled to the relief
contemplated by
s 17(1)
and if I cannot make such a finding or find
that they are not so caused, the action must fail.
[13] The term ‘major
structural defect’ is defined in
s 1
of the Act to mean ‘a
defect which gives rise or which is likely to give rise to damage of
such severity that it affects
or is likely to affect the structural
integrity of a home and which requires complete or partial rebuilding
of the home or extensive
repair work to it, subject to the
limitations, qualifications or exclusions that may be prescribed by
the Minister’.
[14] The conclusion
reached by the civil engineer who testified as an expert on behalf of
Stergianos – Kleinhans, who I have
mentioned above – was
that the defects in the concrete floor slab of the home were indeed
caused by major structural defects
in the substructure of the home
and consequent settling of the slab. The NHBRC’s expert, Mr
Thabo Mathibeli, was of the opinion
that the cracks were caused by
shrinkage as a result of poor workmanship when the concrete slab was
poured and the builder’s
failure to place expansion joints in
the slab where they should have been placed. In his view, therefore,
the defects in the slab
were not structural in nature. Both experts
were agreed that, whatever the cause of the cracking, the standard of
workmanship of
the builder left a lot to be desired.
[15] Before turning to
the evidence of the experts called by the plaintiff and the
defendant, it is necessary to say something of
the nature and purpose
of expert evidence and the correct judicial approach to dealing with
it. I commence with Addleson J’s
judgment in
Menday
v Protea Assurance Co Ltd
7
in which he stated:
‘
In essence
the function of an expert is to assist the Court to reach a
conclusion on matters on which the Court itself does not
have the
necessary knowledge to decide. It is not the mere opinion of the
witness which is decisive but his ability to satisfy
the Court that,
because of his special skill, training or experience, the reasons for
the opinion which he expresses are acceptable.’
[16] In
Coopers
(South Africa) (Pty) Ltd v Deutsche Gesellschaft f
ȕ
r
Sch
ӓ
dlingsbek
ӓ
mpfung
Mbh
8
Wessels JA said of the
use of expert evidence:
‘
As I see it,
an expert's opinion represents his reasoned conclusion based on
certain facts or data, which are either common cause,
or established
by his own evidence or that of some other competent witness. Except
possibly where it is not controverted, an expert's
bald statement of
his opinion is not of any real assistance. Proper evaluation of the
opinion can only be undertaken if the process
of reasoning which led
to the conclusion, including the premises from which the reasoning
proceeds, are disclosed by the expert.’
[17] And in
R
v Nksatlala
9
Schreiner JA, in dealing
with the evidence of a finger print expert about a fingerprint which
to the untrained eye was not particularly
clear in respect of all of
the points of resemblance that the expert had identified, stated that
while a court should not accept
the evidence of an expert blindly,
once it has satisfied itself that the evidence can safely be
accepted, it should give ‘effect
to that conclusion even if its
own observation does not positively confirm it’.
[18] Finally, before
turning to the evidence of the expert witnesses, it is necessary to
consider the role that an expert plays
when he or she testifies. This
role, and the consequent responsibilities of an expert witness, was
set out as follows by Davis
J in
Schneider
NO & others v AA & another
:
10
‘
In short, an
expert comes to court to give the court the benefit of his or her
expertise. Agreed, an expert is called by a particular
party,
presumably because the conclusion of the expert, using his or her
expertise, is in favour of the line of argument of the
particular
party. But that does not absolve the expert from providing the court
with as objective and unbiased an opinion, based
on his or her
expertise, as possible. An expert is not a hired gun who dispenses
his or her expertise for the purposes of a particular
case. An expert
does not assume the role of an advocate, nor gives evidence which
goes beyond the logic which is dictated by the
scientific knowledge
which that expert claims to possess.’
[19] When the problems in
the home became evident and after the NHBRC had denied liability,
Kleinhans was commissioned to investigate
the cause of the problems.
In the letter instructing him, Mr E Brand, Stergianos’
attorney, stated that while one Muller
had advised on the project, he
was too closely connected to it to be able to be called as an
independent witness. Brand said in
the letter that his client’s
case ‘is dat sy woning strukturele gebreke het vanweë
gebrekkige bouwerk, en die
NHBRC daaroor moet instaan’ but his
instructions to Kleinhans were the following:
‘
Ons benodig
derhalwe u dienste om die woning te evalueer, en te adviseer ten
opsigte van die beweerde strukturele gebreke.’
[20] Kleinhans proceeded
to inspect the home. He was perturbed by extent of the cracks that he
had observed in both the substructure
and the superstructure of the
home. This, to him, was a visual indication of what he termed obvious
distress of the substructure
– that part of the building from
ground level to the top of the floor.
[21] According to
Kleinhans, the home was built ‘on a primary dune adjacent to
the Indian Ocean, previously covered with indigenous
vegetation as
well as invasive alien vegetation’. It is north facing and
built on a ‘long oblong’ erf. The erf
‘has a
substantial slope with a drop in height of 2.45 metres along the
south-north axis of the house itself’. These
characteristics,
he said, signalled extreme caution to anyone who was going to build
on that site. A builder would need to take
special precautions when
building on a dune because it is mobile. All in all, he said, this
being ‘a special animal’,
an engineer involved in the
project would have to know his stuff to ‘get something
functional’. The characteristics
of the site signalled that it
had to be handled with care.
[22] Given the technical
challenges that the site presented, Kleinhans felt that the
documentation that should have been kept concerning
compliance with
technical requirements and prescribed standards would be important.
He stated that even if the home had been built
according to ‘normal
structural engineering practices’ rather than the National Home
Building Regulations, ‘there
should have been at least a paper
trail of tests, approaches, strategies, in situ tests on the ground,
in situ tests on the strip
footings, concrete tests’ and so on.
He was, however, able to find very little documentation. He did find
a record of three
Dynamic Cone Penetrometer (DCP) tests conducted, it
would appear, before building commenced (and hence before any
in-filling had
taken place) which were probably conducted in order to
classify the soil type for purposes of designating a class to the
site in
terms of the Home Building Manual. These results indicated
cause for concern and the consequent need to take remedial measures.
In his view, the site classification had probably been wrong.
[23] He then proceeded to
examine what he termed the ‘health of the structure’. To
do this he first took a large number
of photographs of the cracks,
recorded them on a plan and looked for a pattern. This involved
measuring the length of the cracks
as well as their maximum widths
and depths. (This information was usefully collated in a document
that was headed ‘All Crack
Summary’.) The total linear
length of the cracks was given at first by Kleinhans as 159 metres.
Later in his evidence, he
spoke of 104 metres. He explained this
discrepancy by saying that while the total length was indeed 159
metres, he had disregarded
the most insignificant cracks from
consideration and the remainder of cracks, which are logged on the
All Cracks Summary totalled
104 metres in linear length.
[24] The longest cracks
that he found were two of five metres, the deepest cracks that he
found were two of 140 mm deep and the
widest crack was 30 mm wide as
its widest. (I leave out of consideration a hole, rather than a
crack, that was 60 mm wide and 60
mm long, the cause of which was
speculated upon and debated at length but which takes the matter no
further.) Of the 57 cracks
that he recorded in the All Cracks
Summary, 33 were longer than a metre. Most were in the floor slab
while some were in the walls
and ceiling and one was in a pillar.
There were cracks in every room including the garage and scullery. An
example of one of the
most severe cracks was one in the main bedroom.
It was 4,8 metres long. This was the entire width of the room. It was
6 mm wide
and 140 mm deep. If this was not the full depth of the
slab, it was fairly close to that.
[25] Having concluded
from his observations that the problem was probably substructure
failure, Kleinhans then conducted DCP tests
in order to determine the
density of the fill below the slab. To this end, he commissioned
Outeniqua Lab (Pty) Ltd to supply the
instrument and the technician
to operate it but he supervised the tests and recorded the results
for himself. It was argued that
the evidence of Kleinhans in respect
of the results of the DCP tests was inadmissible hearsay as the
technician who compiled the
test reports was not called as a witness.
In my view, this argument has no merit. Kleinhans conducted the tests
even if someone
else did the physical work and even though someone
else plotted the results onto paper. These tests, conducted in seven
places
chosen by Kleinhans, confirmed his visual analysis of the
cause of the problem. They showed that the fill beneath the slab was
not sufficiently compacted to bear the weight of the slab.
[26] From his visual
observations, his photographing and recording of the lengths, depths
and widths of the cracks, his plotting
of their positions in the
home, his consideration of DCP tests conducted before building began
and his own DCP tests on the fill
beneath the slab, Kleinhans
concluded that the cracks were caused by a serious failure of the
substructure of the home. The fact
that there was no record of what
was done to safeguard against the dangers inherent in building on a
fundamentally unstable site,
and no evidence that he could observe of
any special precautions having been taken, strengthened his opinion
that the heart of
the problem was structural: in essence, bad
workmanship had resulted in structural failure.
[27] In justifying this
conclusion, Kleinhans explained that in order for the slab to carry
its intended load, and bearing in mind
that a certain amount of
shrinkage is bound to occur, the material that supports the slab must
have integrity and must not be able
to subside, it should not be able
to draw moisture from the concrete thereby reducing the strength of
the concrete and the concrete
slab must be ‘poured with care,
with good quality material, with good specification and supervision
and with good aging so
that it does not collapse under own weight,
imposed weight and dynamic weight’. He concluded this
explanation by saying the
following of the cause of the problem:
‘
So what
caused it in this case? A combination of all these factors. A sick
support, bad concrete material placing, bad design and
an absence of
plastic preventing cement water to be sucked away. The slab did not
have a chance from the beginning.’
[28] As far as the
remedial work needed was concerned, Kleinhans said that there were
two possibilities. In both instances, the
walls would remain standing
while the slab would have to be removed. The first solution, which he
favoured, is to ‘acknowledge
that the soil is not worth
anything’ and pour a slab with re-enforcement, as one would in
a multi-storey building. He concluded
on this option that ‘with
clever placing of those suspended slabs, well planned expansion
joints, good engineering, it will
be better not to try and remedy the
soil compaction below’. The second option is, once the slab has
been removed, to remove
the soil below it, re-compact it and pour the
slab again. This option presented problems, not least of them being
the prohibitive
costs.
[29] Mr Thabo Mathibeli
who, like Kleinhans, is a structural engineer, was called as an
expert witness by the defendant. He inspected
the home on two
occasions and came to a conclusion contrary to that of Kleinhans. He
inspected the walls, both inside and outside,
in order to look for
any separation of the walls from the slab and cracks running into the
foundations, both of which would, he
said, indicate subsidence of the
substructure. He found neither and concluded that the problem was
caused simply by bad workmanship.
The builder had not poured the
concrete properly and had not placed joints to allow for shrinkage.
The resultant stress in the
concrete had caused the cracks. In other
words, in the view of Mathibeli, the problem was not structural at
all. That being so,
and as the cracks were, he said, merely surface
cracks, all that was required was for the cracks to be ground and
filled properly
with the appropriate material and for joints to be
created where appropriate.
[30] The outcome of this
case turns entirely on the expert evidence. I am faced with opinions
as to the cause of the cracking expressed
by two experienced and
qualified structural engineers that are at odds with each other. In
circumstances such as this, I am required
to analyse the essential
reasoning of the expert witnesses and to consider how logical the
opinions of each are, viewed in the
light of the probabilities.
11
I am required, as in any
civil dispute, to decide on the evidence placed before me whether it
is more probable that the cracking
was caused by poor workmanship
that led to structural failure or was simply the product of poor
workmanship that had no structural
implications.
12
[31] Before turning to
that analysis, I shall say something of the performance of both
experts in the witness box. Both gave evidence
in a clear manner,
often explaining complex engineering concepts in terms that were, for
a lay person, easily understood. Both
may be criticised, to an
extent, for an unwillingness at times to make concessions that had to
be made. That said, however, in
the case of both of them, this was
not a criticism that applied to their evidence as a whole, and nor is
it a criticism that adversely
affects their credibility or
independence as experts to any significant degree.
[32] Kleinhans was
criticised for exaggerating the total length of the cracks, as he
first said that this was 159 metres, and that
this represented nearly
two rugby fields. He gave an explanation for this evidence. He said
that while he had measured cracks with
a total length of 159 metres,
for purposes of his report he had left out of consideration a number
of cracks that were not cause
for concern. That left a total length
of 104 metres. It was clear, however, that he was at all times
concerned with a total crack
length of 104 metres: that appears from
his report and from the rest of his evidence. If he can be
criticised, it is for not knowing
the length of a rugby field, rather
than for attempting to mislead the court! He was also criticised for
regarding the plaintiff
as his ‘client’. While it is true
that he referred to the plaintiff in these terms, he was expressing,
it seemed to
me, the idea of a professional relationship between
them, rather than expressing partisanship. From his evidence and his
demeanour
in the witness box, I never gained the impression that he
was championing the cause of his ‘client’ come what may.
I do not consider this criticism to have merit.
[33] Mathibeli’s
opinion that the cracks were caused by bad workmanship alone and not
by structural failure was based on his
observations of the home on
two occasions. He conducted no tests and he did not measure,
catalogue and classify the cracks as Kleinhans
did. His opinion is
based on one central observation: if the problem was caused by
sub-structural failure, there would have been
evidence of the slab
pulling away from the walls. As there was no such evidence, the
cracking could not, in his opinion, have been
caused by the
subsidence of the fill.
[34] Kleinhans had
testified, however, that subsidence of the fill would not necessarily
have led to the slab and the walls pulling
away from each other.
While it could have such a result, there were other possibilities.
One was dealing with what he termed a
‘complex mechanism’.
How the slab reacted was dependant on the geology below the in situ
material. There were, in any
event in his view, indications of the
type of problem that Mathibeli spoke of. Cracks in the scullery and
garage, for instance,
ran diagonally from wall to wall.
[35] In my view, the
opinion of Kleinhans as to the cause of the cracks is to be preferred
over that of Mathibeli. Kleinhans engaged
in a meticulous mapping and
measuring of the cracks, and once he had formed the view that the
problem lay, in all probability,
in the fill below the slab, he
conducted tests in order to either confirm his view or disprove it.
The DCP tests indicated that
his initial view was in fact correct. It
was suggested that the DCP tests were of little consequence because
they were only indicative
and not definitive of the cause of the
problem. As I understood the evidence of Kleinhans, however, a DCP
test could give a false
result in favour of soil being more compacted
than it was – as where, for instance, the plunger struck a
piece of rock that
happened to be in the way – and it was in
that sense seen as merely indicative. In this case, it showed that
the soil was
not sufficiently compacted. What is more, seven DCP
tests were conducted at different sites in the house and the results,
taken
together, indicated a compaction problem in the material below
the slab. It should be borne in mind too that the home was built
on a
site that held its own challenges and Kleinhans was not able to find
any records to indicate that special measures had been
taken to avoid
the risks inherent in building on such a site. The DCP tests confirm
that, in all probability, no special precautions
were taken.
[36] Kleinhans was
criticised for not conducting further tests but once he had the
results of the DCP tests there was really no
need to conduct further
tests: he had, as far as he was concerned, determined the cause of
the problem. In any event, the further
tests that could have been
conducted would have been invasive, and he wished to avoid that.
[37] The DCP tests
conducted by Kleinhans swing the probabilities in favour of his
opinion. The fact that the density of the fill
below the slab was
shown to be wanting also lends credence to his explanation that
cracking in the walls is not the only sign of
substructural
subsidence.
[38] I therefore find
that it is more probable than not that the cracking in the
plaintiff’s home was caused by a failure
of the substructure of
the house. That, in turn, means that the plaintiff has discharged the
onus resting on him to establish a
structural defect and there can be
no doubt that the structural defect is a major defect: the defect, to
apply the definition of
a major structural defect, has been proved to
be one that has given rise to damage of such severity that it has
affected the structural
integrity of the home, which now requires
extensive repair work to it.
[39] In the result, I
make the following order.
(a) The defendant is
ordered, in terms of s 17 of the Housing Consumer Protection Measures
Act 95 of 1998, to rectify the structural
defects in the plaintiff’s
home, situate at erf 1392, Kleinkrantz, Wilderness, subject to the
maximum amount prescribed by
regulation 13(1), read with regulation
13(2), of the regulations promulgated in terms of the Housing
Consumer Protection Measures
Act.
(b) The defendant is
ordered to pay the plaintiff’s costs.
___________________________
C Plasket
Judge of the High Court
APPEARANCES:
For the plaintiff: Mr L
Joubert SC, instructed by Cilliers Odendaal, George and Kaplan
Blumberg Attorneys, Port Elizabeth
For the defendant: Mr L
Schubart SC, instructed by V P Maluleke Attorneys and Lexicon
Attorrneys, Port Elizabeth
1
The
long title of the Act states that its purpose is to ‘make
provision for the protection of housing consumers; and to
provide
for the establishment and functions of the National Home Builders
Registration Council; and to provide for matters incidental
therewith’.
2
Section
3(a).
3
Section
3(b).
4
Section
3(c).
5
Section
3(d).
6
Although
the contract was entered into, and the home is situated in the
Wilderness within the jurisdiction of the Western Cape
High Court,
Cape Town, the parties were agreed that this court has jurisdiction.
The relevant regional office of the NHBRC is
situated in Port
Elizabeth and the cause of action substantially originated within
this court’s area of jurisdiction.
7
Menday
v Protea Assurance Co Ltd
1976
(1) SA 565
(E), 569B-C.
8
Coopers
(South Africa) (Pty) Ltd v Deutsche Gesellschaft f
ȕ
r
Sch
ӓ
dlingsbek
ӓ
mpfung
Mbh
1976 (3) SA 352
(A),
371G.
9
R
v Nksatlala
1960 (3) SA
543
(A), 546D. See too
Ruto
Flour Mills Ltd v Adelson (1)
1958
(4) SA 235
(T), 237A-G.
10
Schneider
NO & others v AA & another
2010
(5) SA 203
(WCC), 211J-212B. See too
Stock
v Stock
1981 (3) SA 1280
(A), E-G.
11
Michael
& another v Linksfield Park Clinic (Pty) Ltd & another
2001 (3) SA 1188
(SCA), paras 34-40.
12
National
Employers’ General Insurance Co Ltd v Jagers
1984
(4) SA 437
(E), 440D-G;
Stellenbosch
Farmers’ Winery Group Ltd & another v Martell et Cie &
others
2003 (1) SA 11
(SCA), para 5;
Dreyer &
another NNO v AXZS Industries (Pty) Ltd
2006
(5) SA 548
(SCA), para 30.