Construction Law Review

Construction Law Review – March

Please refer below to our Construction Law Review, selected from AR Conolly’s Daily Bulletins covering Insurance, Banking, Construction & Government.

Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd [2018] HCA 4
High Court of Australia
Kiefel CJ; Bell, Gageler, Keane, Nettle, Gordon & Edelman JJ
Security of payments – appeal concerned sole question whether scheme which Building and Construction Industry Security of Payment Act 1999 (NSW) (Security of Payment Act) established in respect of progress payments, ousted Supreme Court of New South Wales’ jurisdiction to quash adjudicator’s determination for error of law on the face of the record – whether judicial review excluded for non-jurisdictional error – held: Security of Payment Act ousted Supreme Court of New South Wales’ jurisdiction to quash determination for error of law on the face of the record – appeal dismissed.
Probuild Constructions

Gordon v Lever [2018] NSWCA 43
Court of Appeal of New South Wales
McColl & White JJA; Sackville AJA
Real property – easements – applicants sought creation of easement of carriageway pursuant to s88K Conveyancing Act 1919 (NSW) over respondent’s land – primary judge concluded easement was ’reasonably necessary’ – applicants challenged primary judge’s declaration in respect of limitation it placed on use of right of carriageway to periods when alternative route impassable – applicants also challenged compensation to respondents – whether primary judge in position to declare whether easement ’reasonably necessary’ – held: declaration lacked specificity – there was absence of evidentiary foundation for conclusion as to difficulty drafting terms limiting carriageway’s use to circumstances where alternative route was “unsafe to pass” or was “impassable” – primary judge not in position make declaration resolving whether easement ’reasonably necessary’ – there was ’significant risk of injustice’ to applicants – appeal allowed – proceedings remitted.
View Decision

Built Environs WA Pty Ltd v Perth Airport Pty Ltd [No 2] [2018] WASC 17
Supreme Court of Western Australia
Tottle J
Contract – plaintiff was head contractor for construction of project – defendant was principal – parties entered construction contract – plaintiff claimed defendant wrongly had recourse to performance bonds provided under contract and breached contract by presenting them for payment – plaintiff contended that presenting performance bonds breached not the contract, but separate agreement by email – whether email constituted binding agreement – whether parties intended to create legal relations – if there was an agreement, whether defendant breached its terms – whether, if email not agreement, defendant was estopped from contending it had no legal effect and/or estopped from taking steps to recover liquidated damages from plaintiff under contract – held: email did not constitute binding agreement – even it was an agreement, defendant did not breach it – estoppel claim failed – Court upheld counter-claim – defendant entitled to declaration of entitlement call on performance bonds – defendant entitled to succeed against plaintiff in claim for unpaid money.
Built Environs

Ian Street Developer Pty Ltd v Arrow International Pty Ltd [2018] VSC 14
Supreme Court of Victoria
Riordan J
Building and construction – security of payments – plaintiff sought to quash adjudication determination – whether determination was made out of time – whether plaintiff was ‘in the business of building residences’ – validity of payment claim – whether ‘out of time determination’ was void – ss7(2)(b), 14 & 22(4) Building and Construction Industry Security of Payment Act 2002 (Vic) – held: adjudicator’s determination was made out of time provided in s22(4) – however determination was valid – plaintiff was ‘in the business of building residences’ – payment claim was not invalid – determination not quashed – proceeding dismissed.
Ian Street Developer

Tsoromokos v Australian Native Landscapes Pty Ltd [2018] NSWSC 321
Supreme Court of New South Wales
Latham J
Negligence – plaintiff was independent contractor – plaintiff injured while repairing tank of loader which defendant owned and operated – plaintiff contended accident was caused by defendant’s negligence – plaintiff and wife were sole directors of company – defendant cross-claimed against company for breach of contract, and for indemnity and/or contribution under Law Reform (Miscellaneous Provisions) Act 1946 (NSW) – company also cross-claimed against defendant seeking indemnity for payments under s151Z(1)(d) Workers Compensation Act 1987 (NSW) – held: defendant, by failing to rectify weld, breached duty of care to rectify ’any known defect’ that would expose plaintiff to ’risk of serious injury’ – causation established – contributory negligence assessed at 40% – judgment for plaintiff – judgment for cross defendant on first cross claim – judgment for cross claimant on second cross claim.
View Decision

Mann v Paterson Constructions Pty Ltd [2018] VSC 119
Supreme Court of Victoria
Cavanough J
Restitution – building contract – administrative law – applicants entered standard form written contract with respondent for construction of two units on land they owned – building contract subject to Domestic Building Contracts Act 1995 (Vic) – dispute arose concerning claimed money and other matters – applicants purported to terminate contract and exclude respondent from site – parties contended wrongful repudiation against each other – Senior Member of Victorian Civil and Administrative Tribunal found applicants wrongfully repudiated building contract and respondent entitled to payment on quantum meruit basis – applicants ordered to pay amount to respondent – applicants appealed – ‘two underlying issues’ – whether Senior Member ‘misunderstood or misapplied the test’ in valuation of quantum meruit claim – whether erroneous finding respondent entitled to recover amount on quantum meruit basis concerning items amounting to variation on work’s original scope – held: appeal dismissed except in relation to point concerning ‘alleged mathematical error’ in Tribunal’s final order, in respect of which parties invited to state their position.

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