Acciona Industrial Australia Pty Ltd v Kwinana WTE Project Co Pty Ltd

In the matter of Acciona Industrial Australia Pty Ltd v Kwinana WTE Project Co Pty Ltd, the parties were embroiled in a dispute over whether COVID-19 could be considered a force majeure event under their contractual agreement, and if so, whether the court should provide a declaratory judgment on the matter. The case was heard in the Supreme Court of Western Australia, where the primary legal issue was whether the court should grant a declaratory judgment on the hypothetical question of whether COVID-19 constituted a force majeure event under the contract. The applicant, Acciona, sought a declaration that COVID-19 was a force majeure event, which would entitle it to an extension of time and relief from certain obligations. The respondent, Project Co, objected to the declaratory judgment on the grounds that the question was hypothetical and would not resolve the controversy between the parties.

The court considered the statutory provisions that allowed it to grant a declaratory judgment, specifically Order 18 r 16 of the Rules of the Supreme Court 1971 (WA) and Section 24(7) of the Supreme Court Act. The court acknowledged that it had the power to grant a declaratory judgment but needed to exercise its discretion in a manner that was just and responsible. The court examined the relevant case law, including Forster v Jododex, where Gibbs J outlined the broad discretion given to the court in making a declaration, and the principles that should guide the exercise of that discretion. The court noted that while the power to grant a declaration was wide, it should not be exercised lightly and only when there were circumstances that called for it.

In reaching its decision, the court considered the arguments presented by both parties and the potential impact of a declaratory judgment on the ongoing dispute. The court concluded that the question of whether COVID-19 was a force majeure event was hypothetical and would not resolve the controversy between the parties. The court found that the declaratory judgment would not quell the controversy and would leave substantial aspects of the dispute unresolved. The court therefore exercised its discretion not to grant the declaratory judgment sought by Acciona.

The court's decision was based on the principle that the power to grant a declaration should be exercised with a proper sense of responsibility and a full realisation that judicial pronouncements ought not to be issued unless there are circumstances that call for their making. The court found that the circumstances in this case did not warrant the exercise of its discretion to grant a declaratory judgment. The court's decision was a careful consideration of the statutory provisions, relevant case law, and the specific facts of the case. The court's decision not to grant the declaratory judgment sought by Acciona was based on its assessment that the question was hypothetical and would not resolve the controversy between the parties. The court's decision was a balanced and responsible exercise of its discretion in the context of a complex and evolving legal issue.