Geraldton Building Co Pty Ltd v May

Geraldton Building Co Pty Ltd (the appellant) appealed to the High Court of Australia from a decision of the Supreme Court of Western Australia. The dispute concerned the interpretation of a building contract and the appellant's liability for alleged defects in the construction of a hotel. The appellant contended that the respondent, the owner of the hotel, had waived its right to claim for certain defects and had accepted the work as substantially completed.

The High Court was required to determine whether the respondent had, by its conduct, waived its right to rely on the contractual provisions relating to defects. Specifically, the court had to consider whether the respondent's acceptance of the building and its subsequent use of the hotel constituted a waiver of its right to claim for defects that were apparent or discoverable at the time of acceptance. The court also had to consider the meaning and effect of the contractual term "substantial completion" and whether the building had achieved this status.

The High Court, in a joint judgment, held that the respondent had not waived its right to claim for defects. The court reasoned that the acceptance of the building and its use did not necessarily imply an acceptance of the work as free from defects, particularly where the contract provided for a defects liability period. The court emphasised that a waiver requires a clear and unequivocal intention to abandon a known right, which was not demonstrated by the respondent's actions. Furthermore, the court found that the building was not substantially completed at the time of purported acceptance, as significant defects remained which prevented the hotel from being used for its intended purpose without further work.

The appeal was dismissed.