Lavish Constructions Pty Ltd v Haywagner Investments Pty Ltd

Lavish Constructions Pty Ltd brought an action against Haywagner Investments Pty Ltd, seeking payment for construction works performed under a written contract, and relief from what it claimed were misleading, deceptive, or otherwise unjust contractual terms. The dispute was heard by the Australian Building and Construction Commission, which had jurisdiction under the Building and Construction Industry Security of Payment Act 2002 (Cth). The primary issue before the Commission was whether the signed written contract bound the parties and, if so, whether Lavish Constructions was entitled to a declaration that any misleading, deceptive or otherwise unjust contractual term was of no effect or to otherwise vary the contract to avoid injustice. The Commission also needed to determine whether Lavish Constructions had proved its entitlement to, and the quantum of, the claims for payment, and whether the rate of interest claimed by Lavish Constructions was in the nature of a penalty.

The Commission held that the signed written contract bound the parties. It found that Lavish Constructions was not entitled to a declaration that any contractual term was of no effect or to otherwise vary the contract to avoid injustice. The Commission concluded that Lavish Constructions had proved its entitlement to the claimed sums, but it reduced the amount payable because some of the claims were not substantiated. The Commission also found that the rate of interest claimed by Lavish Constructions was not in the nature of a penalty. The Commission ordered Haywagner Investments to pay Lavish Constructions the reduced sum of $4,554.56 by 4:00pm on 10 March 2017. The Commission made orders in relation to the costs of the proceeding.