Eden Co Construction Pty Ltd v Leed Engineering and Construction Pty Ltd - [2018] NSWSC 1882

Supreme Court

New South Wales

Medium Neutral Citation: Eden Co Construction Pty Ltd v Leed Engineering and Construction Pty Ltd [2018] NSWSC 1882
Hearing dates: 5 December 2018
Date of orders: 12 December 2018
Decision date: 12 December 2018
Jurisdiction: Common Law
Before: Fagan J
Decision:
(1) Leave to appeal is granted so far as is necessary.
(2) The summons is dismissed.
(3) The plaintiff is to pay the defendant’s costs of the summons.
(4) I grant liberty to the Defendant to file an application for indemnity costs by Friday 14 December 2018.
(5) The plaintiff to file any evidence in reply by 21 December 2018.

Catchwords: CONTRACTS - termination - breach of term - summons seeking leave to appeal judgment for defendant in the Local Court - plaintiff engaged as subcontractor to undertake construction work - where clause of contact provided for procedure to terminate upon breach, including three-day notice period to allow for rectification of breach - plaintiff did not comply with safety policy and directions - where defendant terminated under common law - whether observance of safety policy essential condition or intermediate term - whether clause stipulating procedure for termination excluded common law right to terminate - summons dismissed
Legislation Cited: Local Court Act 2007 (NSW)
Cases Cited: Concut Pty Ltd v Worrell [2000] HCA 64
Koompahtoo Local Aboriginal Land Council v Sanpine Pty Limited (2007) 233 CLR 115;[2007] HCA 61
Stocznia Gdanska SA v Latvian Shipping Co [1998] 1 WLR 574
Tan Hung Nguyen v Luxury Design Homes Pty Ltd [2004] NSWCA 178
Category: Principal judgment
Parties: Eden Co Construction Pty Ltd (plaintiff)
Leed Engineering and Construction Pty Ltd (defendant
Representation:
Counsel:
J Cameron solicitor (plaintiff)
R Perla (defendant)
Solicitors:
Johninfo Lawyers Pty Ltd (plaintiff)
Fisher Jeffries (defendant)

File Number(s): 2017/375129
Publication restriction: No
Decision under appeal

Court or tribunal:

Local Court Queanbeyan

Date of Decision:

27 September 2017

Before:

Antrum LCM

File Number(s):

2016/145044

Judgment

FAGAN J: This is an appeal from a decision of Mr Antrum LCM sitting in the Local Court at Queanbeyan. The plaintiff is a construction contractor. On 16 February 2016 it entered into a subcontract with the defendant to construct manholes in a sewer line which the defendant was installing for Young Shire Council. On 13 March 2016 the plaintiff commenced work on the first of 27 manholes which were to be built. On 18 March 2016 the defendant notified the plaintiff in writing that the subcontract was terminated for breach. In the Local Court the plaintiff contended that this termination was wrongful and claimed damages flowing from the loss of the subcontract. The learned magistrate held that the plaintiff had breached the agreement in fundamental respects and that the defendant had been entitled to give the notice of termination. His Honour dismissed the plaintiff’s claim with costs.
The magistrate’s decision was given on 27 September 2017. The plaintiff filed his summons to commence the appeal on 21 November 2017, approximately one month out of time. On 5…

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.

Keep reading for free

Create a free CaseChat account to read Eden Co Construction Pty Ltd v Leed Engineering and Construc... and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2018] NSWSC 1882
Decision Date: 12 December 2018

CaseChat Overview and Summary

The plaintiff, Eden Co Construction Pty Ltd, sought leave to appeal against a judgment in favour of the defendant, Leed Engineering and Construction Pty Ltd. The dispute originated from a contractual relationship where the plaintiff was engaged as a subcontractor to undertake construction work. The defendant terminated the contract, alleging that the plaintiff had breached a safety policy and failed to follow safety directions. The plaintiff argued that the termination was unlawful, contending that the safety policy was not an essential condition or an intermediate term, and that the contractual termination clause did not exclude the common law right to terminate.

The court examined whether the safety policy was an essential condition or an intermediate term of the contract. If it was deemed an intermediate term, the defendant could only terminate the contract if the breach was sufficiently serious to justify termination. The court also considered whether the contractual termination clause precluded the defendant from terminating under common law. The plaintiff argued that the clause should be interpreted as excluding the common law right to terminate, while the defendant contended that the clause was not exclusive.

The court found that the safety policy was not an essential condition but rather an intermediate term of the contract. The plaintiff's breach of the safety policy was not sufficiently serious to justify termination under common law. The court held that the contractual termination clause did not exclude the common law right to terminate. Consequently, the summons was dismissed, and the defendant was entitled to terminate the contract under common law for the breach of the intermediate term.

The final orders of the court were that the plaintiff's application for leave to appeal was dismissed, and the defendant's termination of the contract was upheld.

Orders