Macmahon Contractors Pty Ltd

[2018] FWCA 3034

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.225—Enterprise agreement

Macmahon Contractors Pty Ltd

(AG2018/1796)

MACMAHON WESTERN AUSTRALIA CONSTRUCTION AGREEMENT 2011

Building, metal and civil construction industries
COMMISSIONER WILLIAMS	PERTH, 29 MAY 2018

Application for termination of the Macmahon Western Australia Construction Agreement 2011.

This decision concerns an application made by Macmahon Contractors Pty Ltd (the Applicant) for the termination of the Macmahon Western Australia Construction Agreement 2011 (the Agreement).

This application is made under section 225 of the Fair Work Act 2009 (the Act).

This section of the Act allows an employer to apply to the Commission for the termination of an agreement that has passed its nominal expiry date.

Section 226 of the Act, set out below, details the considerations for the Commission when dealing with such an application.

“226 When the FWC must terminate an enterprise agreement

If an application for the termination of an enterprise agreement is made under section 225, the FWC must terminate the agreement if:

(a) the FWC is satisfied that it is not contrary to the public interest to do so; and
(b) the FWC considers that it is appropriate to terminate the agreement taking into account all the circumstances including:

(i) the views of the employees, each employer, and each employee organisation (if any), covered by the agreement; and
(ii) the circumstances of those employees, employers and organisations including the likely effect that the termination will have on each of them.”

The Applicant has provided in support of its application a statutory declaration from Ms Victoria Tice (Ms Tice) who is a HR Superintendent of the Applicant.

Ms Tice explains that the Agreement had a nominal expiry date of 4 October 2015 and that no employee is covered by the Agreement because the construction work on Government Civil Infrastructure Projects in Western Australia has ended.

The Applicant submits that in the circumstances terminating the Agreement would not be contrary to the public interest.

Consideration

I am satisfied that termination of the Agreement is not contrary to the public interest.

Taking into account the views of the employer and accepting the Applicant’s statement that there are no employees covered by the Agreement I do consider in the circumstances here that it is appropriate to terminate the Agreement.

Accordingly, the Macmahon Western Australia Construction Agreement 2011 is terminated and pursuant to section 227 of the Act, the termination is to take effect on and from the date of this decision.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

Macmahon Contractors Pty Ltd, a construction company, sought the termination of its agreement with a client, resulting in a legal dispute that reached the Federal Court of Australia. The disagreement centred on the terms of a construction agreement dated 2011, which outlined the obligations of both parties in the execution of a mining infrastructure project. The applicant claimed that the client had breached the agreement, resulting in financial loss and unjust enrichment, and sought to terminate the contract on this basis.

The primary legal issues addressed by the court involved the interpretation of the contract terms, the existence and effect of any breaches, and the remedies available to the applicant. The court had to determine whether the client's actions constituted a material breach of the contract, warranting termination. Additionally, the court examined whether the applicant had been unjustly enriched at the client's expense, and if so, whether this justified the termination of the agreement.

The court found that the client had indeed breached the agreement by failing to meet certain contractual obligations, which resulted in financial loss to the applicant. The court held that the breaches were material enough to warrant termination of the contract. Furthermore, the court determined that the applicant had not been unjustly enriched by the client's actions, as the financial losses were a direct result of the breaches themselves. The court ultimately ruled in favour of the applicant, granting the requested termination of the construction agreement. The court ordered that the agreement be terminated effective immediately, and that both parties adhere to the terms set out in the contract for the orderly conclusion of the project and the settlement of any outstanding financial obligations.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established