Aalborg CSP A/S v Ottoway Engineering Pty Ltd

[2017] SASCFC 158

SUPREME COURT OF SOUTH AUSTRALIA

(Full Court)

AALBORG CSP A/S v OTTOWAY ENGINEERING PTY LTD

[2017] SASCFC 158

Judgment of The Full Court

(The Honourable Chief Justice Kourakis, The Honourable Justice Blue and The Honourable Justice Bampton)

1 December 2017

APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES

CONTRACTS - BUILDING, ENGINEERING AND RELATED CONTRACTS - REMUNERATION - STATUTORY REGULATION OF ENTITLEMENT TO AND RECOVERY OF PROGRESS PAYMENTS - PAYMENT CLAIMS

CORPORATIONS - LEGAL CAPACITY AND RELATIONS WITH OUTSIDERS - SERVICE OF DOCUMENT ON COMPANY

Appeal against summary judgment in favour of the plaintiff.

The parties entered into a construction contract within the meaning of the Building and Construction Industry Security of Payment Act 2009 (SA). The appellant is a Danish company. Clause 3 of the contract required all relevant documentation to be provided by the respondent to the appellant in one hard copy and one electronic copy.

The respondent sent to the appellant 22 invoices by email and in addition delivered some or all of them to the appellant in Denmark.  The invoices generally comprised payment claims under the Act.

In May 2016 the respondent sent to the appellant certain formal notices and proceedings in two Supreme Court actions by email and also apparently by delivery to Aalborg’s registered office, being the office of its accountants BDO in Adelaide.

In August 2016 the respondent issued a further invoice/payment claim to the appellant which it delivered only to the appellant’s registered office in Adelaide.

After the appellant did not respond within the requisite 15 days, the respondent instituted the action and sought summary judgment. The appellant relied on three grounds to oppose summary judgment. The Master granted summary judgment. The Master held that section 109X of the Corporations Act 2001 (Cth) empowered service of documents on the registered office and clause 3 of the contract did not affect the position. The Master held that reliance by the appellant on estoppel and misleading conduct was precluded by section 15(4)(b) of the Act and in any event any continuing representation by the respondent was negated by its conduct in May 2016 in serving documents upon the appellant’s registered office.

Held by the Court (allowing the appeal):

1. The Master erred in holding that the decision of the New South Wales Court of Appeal in Falgate Constructions Pty Ltd v Equity Australia Corporation Pty Ltd determined the issue of service under section 109X against the appellant. However, it is unnecessary and undesirable to decide on this appeal constructional issues relating to sections 109X and 601CX of the Corporations Act and clause 3 of the contract and their interaction (at [52]-[54]).

2.  The Master erred in holding that the appellant’s answers based on estoppel and misleading conducted were precluded by section 15(4)(b) of the Act (at [67]).

3.  The Master erred in finding that there was no arguable case for estoppel or misleading conduct to arise on the facts of the dispute (at [78] and [82]).

4.  Appeal allowed, summary judgment set aside…