Architectural Designer and Client Clash at Disputes Tribunal

An architectural designer has faced off against a potential client in the Disputes Tribunal over an unpaid invoice amounting to $3,450. The case revolves around the designer’s claims for payment after providing preliminary work without a formal contract. Central to the dispute is whether a verbal agreement existed between the designer and a woman he met during an open house in Tauranga in September 2022.

Initially, the designer, who was also working as a real estate agent, engaged in discussions about shared interests in “passive home design” with the woman. After their conversation, he entered her details into his client management system, believing they had established a business relationship. Following some preliminary meetings, the designer sent an invoice for 30 hours of work conducted on the project. The woman, however, expressed surprise upon receiving the invoice, leading to the tribunal hearing.

Determining the Nature of the Relationship

The Disputes Tribunal, presided over by adjudicator Sarah Simmonds, needed to address whether a verbal contract had been formed between the two parties. The designer claimed that the woman had shown interest in moving forward with the project, but the woman countered this assertion, stating that she felt overwhelmed by his persistent communications.

The tribunal heard that in early 2023, the woman invited the designer to view the property where she intended to build her new home, sharing a site survey plan via email. Despite these interactions, Simmonds noted that the woman’s responses indicated a desire to keep the relationship informal.

During a meeting in March, which included the woman’s new partner and a builder friend, the designer described the gathering as a “handover meeting” for the project. He maintained that he interpreted the woman’s willingness to discuss working drawings as a commitment to engage his services. Yet, the tribunal found that she attempted to gently rebuff his suggestions, indicating a lack of intent to formalize their relationship.

Tribunal Ruling and Outcomes

The designer’s claim was ultimately dismissed, with Simmonds concluding that no formal contract or quasi-contract had been established. She emphasized that the woman had never intended to enter into a legally binding agreement with him. Furthermore, the designer’s interpretation of their interactions as indicative of a professional relationship was deemed overly optimistic.

While the woman counter-claimed for $1,999 under the Fair Trading Act, this claim was also unsuccessful. Simmonds concluded that although the designer’s behavior might have been persistent, it did not reach a level of unconscionable conduct.

“[The designer] was excited by the prospect of assisting [the woman] and actively looking for work,” Simmonds stated. “As soon as [the woman] directed him to stop, he did.”

This case highlights the complexities surrounding verbal agreements in the design industry and the importance of clear communication in establishing professional relationships. It serves as a reminder for both clients and service providers to ensure that expectations are clearly articulated and documented before embarking on any project.