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Cenric Group v TWT Property Group

Cenric Group v TWT Property Group

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Case Copied 18 October 2018 72 min read

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Supreme Court

New South Wales

Medium Neutral Citation: Cenric Group v TWT Property Group [2018] NSWSC 1570
Hearing dates: 30/07/2018, 31/07/2018, 01/08/2018, 10/09/2018, 11/09/2018 and 12/09/2018
Date of orders: 18 October 2018
Decision date: 18 October 2018
Jurisdiction: Equity - Technology and Construction List
Before: McDougall J
Decision:
See at [266]. Parties to bring in draft orders.

Catchwords:
CONTRACT – where parties entered into various contractual arrangements to harvest sandstone – which party is entitled to share in royalties from that harvesting – on what terms must the royalties be paid – when must payment of royalties be made.

CONTRACT – whether an oral agreement or variation was made – enforceability and effect of that variation – whether contracts validly terminated – construction of the terms of contracts and subcontracts – importance of not using a hindsight view of commerciality to disregard the terms of the contract.
BUILDING AND CONSTRUCTION – where milestone dates were missed – liquidated damages – application of prevention principle prevents award of such damages.
Legislation Cited: Civil Procedure Act 2005 (NSW)
Conveyancing Act 1919 (NSW)
Environmental Planning and Assessment Act 1979 (NSW)
Cases Cited: Armory v Delamirie (1722) 1 Strange 505; 93 ER 664
Beatty v Guggenheim Exploration Co (1919) 225 NY 380
Commercial Union Assurance Company of Australia Ltd v Ferrcom Pty Ltd (1991) 22 NSWLR 389
Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226
Fortescue Metals Group Ltd v Commonwealth (2013) 250 CLR 548
GEC Marconi Systems Pty Ltd v BHP Information Technology Pty Ltd (2003) 128 FCR 1
Hawcroft General Trading Co Pty Ltd v Hawcroft [2017] NSWCA 91
Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41.
Houghton v Immer (No 155) Pty Ltd (1997) 44 NSWLR 46
John Alexander’s Clubs Pty Ltd v White City Tennis Club Ltd (2010) 241 CLR 1
Jones v Dunkel (1959) 101 CLR 298
LJP Investments Pty Ltd v Howard Chia Investments Pty Ltd (No 2) (1990) 24 NSWLR 499
McDonald v Dennys Lascelles Ltd (1933) 48 CLR 457.
MWB Business Exchange Centres Ltd v Rock Advertising Ltd [2018] 2 WLR 1603
Peter Turnbull & Co Pty Ltd v Mundus Trading Co Australasia Pty Ltd (1954) 90 CLR 235
Probuild Constructions (Aust) Pty Ltd v DDI Group Pty Ltd (2017) 95 NSWLR 82
Shepherd v Felt & Textiles of Australia Ltd (1931) 45 CLR 359
Spiers Earthworks Pty Ltd v Landtec Projects Corp Pty Ltd (No.2) (2012) 287 ALR 360
Watson v Foxman (1995) 49 NSWLR 315
Category: Principal judgment
Parties: Cenric Group Pty Ltd (First Plaintiff)
TWT Property Group Pty Ltd (First Defendant)
Bundanoon Sandstone Pty Ltd (Second Defendant)
Representation:
Counsel:
CRC Newlinds SC / D Hughes / R Thrift (Plaintiff)
B DeBuse (First Defendant)
M Ashhurst SC (on 30/07/2018 – 01/08/2018) / F Corsaro (on 10/09/2018 – 12/09/2018) SC / G Gee (Second Defendant)
Solicitors:

File Number(s): 2018/99816

Judgment

HIS HONOUR: Many public buildings, in particular those dating from the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2018] NSWSC 1570
Decision Date: 18 October 2018

CaseChat Overview and Summary

In the case of Cenric Group v TWT Property Group, the dispute arose from various contractual arrangements concerning the harvesting of sandstone. The primary issue was the entitlement of each party to royalties from the sandstone harvesting and the terms under which these royalties were to be paid, including the timing of such payments. The case was heard in the court, which was required to determine the enforceability of an oral agreement or variation of the original contracts, the validity of contract terminations, and the construction of specific contract terms and subcontracts. Additionally, the court had to address the application of the prevention principle in relation to missed milestone dates and liquidated damages.

The court focused on the enforceability and effect of any oral agreements or variations, considering the importance of adhering to the contractual terms rather than applying a hindsight view of commerciality. It also examined whether the contracts were validly terminated and the precise terms of the contracts and subcontracts, including the conditions for the payment of royalties. The court highlighted the importance of not disregarding contractual terms based on a retrospective assessment of commerciality.

In its reasoning, the court determined that the oral agreement or variation, if proven, would have specific enforceability and effect. It assessed whether the contracts were validly terminated and clarified the terms governing the payment of royalties, including the timing. The court also applied the prevention principle, which prevented the award of liquidated damages for missed milestone dates. The court's decision was based on a detailed analysis of the contractual terms and the commercial realities of the situation.

The final orders of the court were to clarify the entitlement of each party to royalties from the sandstone harvesting, the terms and timing of royalty payments, and the enforceability of any oral agreements or variations. The court also ruled on the validity of contract terminations and the application of the prevention principle to liquidated damages for missed milestone dates.

Orders