Emirge Pty Ltd v De Coppi - [2025] WADC 23

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION:   PERTH
CITATION:   EMIRGE PTY LTD -v- DE COPPI [2025] WADC 23
CORAM:   CHRISTIAN DCJ
HEARD:   12-13 DECEMBER 2024
DELIVERED          :   10 APRIL 2025
FILE NO/S:   CIV 3822 of 2023
BETWEEN:   EMIRGE PTY LTD
Plaintiff

AND

TONY DE COPPI
Defendant

Catchwords:

Contract - Whether oral gentlemen's agreement or side deal varied written contract - Turns on own facts

Penalty - Whether clause providing for interest is a penalty - Turns on own facts

Legislation:

Nil

Result:

Judgment for the plaintiff

Representation:

Counsel:

Plaintiff	:	Mr A P Hershowitz
Defendant	:	In person

Solicitors:

Plaintiff	:	Paiker & Overmeire
Defendant	:	Not applicable

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

Coyne v GSC Contracting Pty Ltd [2022] WADC 115
Ringrow Pty Ltd v BP Australian Pty Ltd [2005] HCA 71; (2005) 224 CLR 656
Spiers Earthworks Pty Ltd v Landtec Projects Corporations Pty Ltd [No 2] [2012] WASCA 53

CHRISTIAN DCJ:

Introduction

This action concerns an amount of money which remains unpaid pursuant to a contract. On 20 June 2022 Emirge Pty Ltd (Emirge) and Mr De Coppi entered into a Residential Building Works Contract (the Written Contract) for the construction of a new house at 52 Saltriver Street, Ellenbrook. Mr De Coppi agreed to pay Emirge the sum of $450,000 to build the house. Pursuant to the Written Contract, tax invoices for five progress claims were submitted by Emirge to Mr De Coppi totalling $204,750. Emirge was paid $75,750 in respect of the progress claims by Mr De Coppi's lender, Pepper Money (Pepper), on 12 April 2023. The $129,000 difference between those two amounts is the subject of this action.

Issues for resolution

It is not disputed by Mr De Coppi that Emirge submitted five progress claims. Nor is there any dispute that the sum of $129,000 remains unpaid.
There are two issues for determination. The first is whether pursuant to some gentlemen's agreement or side deal Mr De Coppi was not required to pay the sum of $129,000.
The second only arises if I find in favour of Emirge in relation to the first issue. It is whether the interest charged pursuant to the contract constitutes a penalty.

Was there a gentlemen's agreement or side deal?

Relevant contractual terms of the Written Contract

There is no dispute that the Written Contract required Mr De Coppi to pay $450,000.
Clause 25 of the Written Contract sets out the terms of payment of the $450,000, which was to be by way of progressive payments upon the submission by Emirge to Mr De Coppi of claims in accordance with completion of works as detailed in a schedule which formed part of the Written Contract.
Item 7 of Appendix 1 of the Written Contract refers to the method of progress claims. Item 7 consists of a separate document, which was signed by both Mr Dye, a director of Emirge, and Mr De Coppi on 20 June 2022 (

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 Emirge Pty Ltd v De Coppi

Details

AGLC: Emirge Pty Ltd v De Coppi [2025] WADC 23
Case: [2025] WADC 23
Decision Date: 10 APRIL 2025

CaseChat Overview and Summary

Emirge Pty Ltd, the plaintiff, sued De Coppi, the defendant, in the Supreme Court of New South Wales over a breach of contract. The plaintiff sought compensation for the defendant's failure to make payments under a written agreement. The primary dispute was whether an oral agreement or side deal had varied the written contract, and whether a clause providing for interest was a penalty. The court had to decide if the written contract had been altered by an oral agreement and whether the interest clause was a penalty.

The court examined whether the written contract had been varied by an oral agreement or side deal. It was acknowledged that whether an oral agreement exists to vary a written contract depends on the specific facts of each case. However, the court found no evidence to support the existence of such an agreement in this case. Next, the court considered if the interest clause constituted a penalty. It was established that an interest rate would be a penalty if it was extravagant and unconscionable in comparison with the greatest loss that could conceivably have followed the breach of contract. However, the court found no evidence to support that the interest rate was a penalty in this case.

The court concluded that the plaintiff was entitled to judgment in the sum of $129,000 plus interest at the rate of 20%. The onus was on the defendant to prove that the interest clause was a penalty, but there was no evidence presented to support this claim. The court found that on its face, the interest rate was not a penalty. The court would hear the parties in relation to the formulation of the final orders and costs.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

The onus is on Mr De Coppi to prove the clause is a penalty.[5] An interest rate will be a penalty if it is extravagant and unconscionable in comparison with the greatest loss that could conceivably have followed the breach of contract.[6] [5] Spiers Earthworks Pty Ltd v Landtec Projects Corporations Pty Ltd [No 2] [2012] WASCA 53 [23], [86].[6] Ringrow Pty Ltd v BP Australian Pty Ltd [2005] HCA 71; (2005) 224 CLR 656 [32]. There was no evidence led in relation to this issue. On its face, I am not satisfied the interest rate was a penalty. Emirge is entitled to judgment in the sum of $129,000 plus interest at the rate of 20%. I will hear the parties in relation to the formulation of the final orders and costs.