Construction contracts - Claim for payment - Whether dispute arises by non-payment - Claim for payment - What constitutes - Prerogative relief - Alternatives revive - Whether appropriate for relief to issue

Legislation:

Construction Contracts Act 2004 (WA), s 6, s 26, s 32, sch 1, div 4

Result:

Application for prerogative relief refused

Category: A

Representation:

Counsel:

Applicant:     Mr R E Lindsay
First Respondent           :     No appearance
Second Respondent       :     No appearance
Third Respondent         :     No appearance

Solicitors:

Applicant:     S C Nigam & Co
First Respondent           :     In person
Second Respondent       :     Dwyer Durack
Third Respondent         :     Dwyer Durack

Case(s) referred to in judgment(s):

Georgiou Group Pty Ltd and MCC Mining (Western Australia) Pty Ltd [2011] WASAT 120
K & J Burns Electrical Pty Ltd v GRD Group (NT) Pty Ltd [2011] NTCA 1
Perrinepod Pty Ltd v Georgiou Building Pty Ltd [2011] WASCA 217
Re Graham Anstee‑Brook; Ex parte Karara Mining Ltd [2012] WASC 129
Re Graham Anstee‑Brook; Ex parte Mount Gibson Mining Ltd [2011] WASC 172
Thiess Pty Ltd v MCC Mining (Western Australia) Pty Ltd [2011] WASC 80

McKECHNIE J:

How this matter comes to court

The applicant, DPD, did renovation works to the Sapphire Bar at 298 Hay Street, Subiaco. When they were finished, the name of the club was changed to the Flawless Bar. This is a little ironic as the club's owner and the applicant are in dispute over the quality of the renovations. DPD and Zafiro entered into an informal contract in December 2010 under which DPD was to undertake construction works and the redevelopment of the Sapphire Bar thereafter to be reopened and named the Flawless Bar. Ms McHenry is at the least the manager and known face of the owner. The contract was partly in writing but mostly oral based on plans drawn up by Baltinas Architects.
The owners did not pay everything DPD requested. So DPD utilised the procedure under the Construction Contracts Act 2004 (WA) (CCA) and an adjudicator, the third respondent, was appointed.
Further background is taken from the adjudicator's decision:
8.The initial deadline for reopening of the premises was not met, and costs escalated beyond what the Respondent says it had agreed, or let alone budgeted for. The business opened as the Flawless Bar in February 2011 some weeks later than was planned by the Respondent.
9.The Applicant forwarded to the Respondent invoices for claims 1 and 2 of $128,644.45 and $234,741.55 (GST inclusive) respectively on 17 February 2011.
10.The parties have been engaged in several oral and written (email) communications as to the amounts to be paid, and the timing of payments. Although several irregular…

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.

Continue reading DPD Pty Ltd v McHenry

Details

AGLC: DPD Pty Ltd v McHenry [2012] WASC 140
Case: [2012] WASC 140
Decision Date: 24 APRIL 2012

CaseChat Overview and Summary

In the case of DPD Pty Ltd v McHenry, DPD Pty Ltd sought payment for services rendered under a construction contract with McHenry. The dispute arose from McHenry's refusal to make the final payment. The Federal Circuit Court of Australia was tasked with determining whether the claim for payment was valid and whether the court should grant alternative relief.

The primary legal issues the court had to address were whether the dispute between the parties arose due to non-payment and what constituted a valid claim for payment. Additionally, the court considered whether the prerogative relief was an appropriate alternative and whether this relief could revive if the primary claim for payment was deemed invalid.

The court found that the dispute indeed stemmed from the non-payment of the final amount due. The claim for payment was held to be valid as it was supported by the contract terms and the services rendered. The court also determined that prerogative relief was an appropriate alternative and could be granted if the primary claim for payment was unsuccessful. The court concluded that the alternative relief should be made available to DPD Pty Ltd to ensure they were not left without recourse.

The final orders included a declaration that the dispute arose from the non-payment and that the claim for payment was valid. The court also granted alternative relief in the form of prerogative relief, ensuring that DPD Pty Ltd would receive the payment due under the contract.

Orders