Ganghui Pty Ltd v YTO Construction Pty Ltd (No 2)

[2023] NSWSC 944

Supreme Court

New South Wales

Medium Neutral Citation:	Ganghui Pty Ltd v YTO Construction Pty Ltd (No 2) [2023] NSWSC 944
Hearing dates:	11 August 2023
Date of orders:	11 August 2023
Decision date:	11 August 2023
Jurisdiction:	Equity - Technology and Construction List
Before:	Stevenson J
Decision:	Judgment for plaintiff against defendant for $2,748,842.60; orders for interest and costs
Catchwords:	JUDGMENTS AND ORDERS – reasons – orders necessary to give effect to principal judgment
Legislation Cited:	Building and Construction Industry Security of Payment Act 1999
Cases Cited:	Ganghui Pty Ltd v YTO Construction Pty Ltd [2023] NSWSC 729
Category:	Consequential orders
Parties:	Ganghui Pty Ltd (Plaintiff/First Cross-Defendant) Fu Ming Guo (Second Cross-Defendant) YTO Construction Pty Ltd (Defendant/Cross-Claimant)
Representation:	Counsel: M Christie SC (Plaintiff/Cross-Defendants) F Corsaro SC (Defendant/Cross-Claimant) Solicitors: Tom Howard Legal (Plaintiff/Cross-Defendants) Armstrong Legal (Defendant/Cross-Claimant)
File Number(s):	2020/220429

JUDGMENT

1. I published my principal judgment in this matter on 28 June 2023. ^[1] I shall use the same abbreviations here.

   1. Ganghui Pty Ltd v YTO Construction Pty Ltd [2023] NSWSC 729.

2. I concluded the judgment by saying:

“Because of the multiplicity of issues that arose in these proceedings, it is not yet clear to me what the final implications are of the findings that I have made for the ultimate outcome of these proceedings.

I will give the parties an opportunity to consider these reasons and then invite submissions as to what orders are necessary to give effect to the reasons and what, if any, further issues require resolution.” ^[2]

2. At [333]-[334].

3. The parties agreed on a timetable to make such submissions.

4. Subject to what I say below, it was common ground that it followed from my reasons that:

1. there should be judgment for the Developer against the Builder in the sum of $2,748,842.60;

2. the Builder should pay the Developer’s costs of proceedings; and

3. the Developer’s claim, and the Builder’s Cross-Claim should otherwise be dismissed.

5. The Developer also claims interest on the judgment at [4(a)] above. That judgment is based on the Developer’s entitlements under the Handwritten Agreement of 22 March 2019. The Developer claims interest from that date. I return to this below.

6. The Builder raises three matters which it contends must be resolved before final orders can be made.

7. The first relates to an aspect of the Builder’s claim for a quantum meruit.

8. At [281] of the judgment I said, in relation to the Builder’s claim under the Further Arrangement:

“A difficulty for the Builder is that, in its Technology and Construction List Cross-Claim Statement, it only pleaded a quantum meruit in relation to the Arrangement. The Builder did not plead a quantum meruit in relation to the Further Arrangement which, as set out in the Technology and Construction List Cross-Claim Statement, is said to provide the basis for the Builder’s claim for variations.”

9. The Builder now submits that it did plead a quantum meruit in relation to the Further Arrangement and pointed to par [12] of its Amended List Response. In that paragraph, the Builder referred to the Handwritten Agreement and asserted that the agreement referred to in that document “was contingent and conditional upon a proper assessment of claims made by the [Builder] on the merits of those claims on a ‘quantum meruit basis’”, and that the Developer had “failed to assess and determine the [Builder’s] claims on the merits of those claims and on a ‘quantum meruit’ basis’”.

10. But those contentions do not relate to the Builder’s alleged entitlement under the Further Agreement. The fact remains, as I have found, that in its Cross-Claim, and in relation to the Further Arrangement, the Builder did not make a claim for a quantum meruit but only made a claim for the variations. The matters in [12] of the Builder’s Response related to a different matter: the Handwritten Agreement.

11. The Builder also referred to [318] of the judgment in which I said, in relation to the Builder’s claim for a variation arising out of the changes in the scope and additional depth of the shoring piles:

“In any event, again, Mr Corsaro did not seek to engage with the Developer’s submission that this work was within the scope of works under the Contract.”

12. The Builder submitted that the “following paragraphs” of my reasons established that the Builder had provided evidence that the work was not within scope. I can see nothing in those “following paragraphs” that has that effect. The following paragraphs dealt with a different variation, relating to a different aspect of the shoring piles.

13. Finally, the Builder referred to [328] of my judgment in which I said that my attention had not been directed to any evidence to establish any of the matters the subject of the reservations of Mr Seeto that I set out at [327] of the judgment. The Builder drew attention to identified paragraphs in the Builder’s quantum submissions. I have again looked at those paragraphs but do not consider that they take the matter any further. They do not relate to the matter the subject of Mr Seeto’s reservations.

14. In apparent response to the Developer’s claim for interest on the amount it is entitled to recover under the Handwritten Agreement, the Builder contended in its reply submissions that because:

1. I found that the Final Payment Certificate purportedly issued under cl 37.4(b) of the Contract was not, as a matter of contract, effective; and

2. the parties had agreed that the Builder’s Final Payment Claim and the Developer’s purported Final Payment Certificate were also a “payment claim” and “payment schedule” for the purposes of the Building andConstruction Industry Security of Payment Act 1999 (NSW) (“the Act”),

it followed, pursuant to s 14 of the Act that the Developer “became liable to pay the claimed amount to [the Builder] on the due date for the progress payment to which the payment claim relates”.

15. The Builder made no such contention in its List Response or Cross-Claim List Statement, nor during the course of the hearing.

16. In any event, as the Developer submitted:

1. it does not follow from the fact that the Final Payment Certificate was not effective as a matter of contract, that it was ineffective as a payment schedule under the Act;

2. no statutory debt under the Act can now arise as I have fully determined the question of the variations that the Builder claimed in its payment claim; and

3. no such statutory debt could now “revive” in circumstances where I have, as a matter of finality, determined what the amount is due to the Builder for variations.

17. The Builder offered no other submission in response to the Developer’s claim for interest.

18. Accordingly, earlier today, I made the following orders to dispose of these proceedings:

1. Judgment for the plaintiff against the defendant in the sum of $2,748,842.66;

2. Order that there be interest on that judgment amount calculated from 22 March 2019 to 11 August 2023 in the sum of $596,446.23;

3. The defendant pay the plaintiff’s costs of the proceedings;

4. Otherwise dismiss the Summons and amended Cross-Summons.

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Endnotes

Decision last updated: 11 August 2023