Metro Edgley Pty. Limited & Anor. v M.K. & J.A. Roche Pty. Limited

Metro Edgley Pty. Limited and another party (the appellants) appealed decisions of the primary judge concerning a building contract and associated guarantees. The dispute involved whether practical completion of the building works had been achieved, the effect of a certificate issued by an independent certifier, and the consequences of an associated agreement being automatically rescinded. The appeals were heard by Giles JA, Hodgson JA, and Campbell JA in the Court of Appeal of New South Wales.

The central legal issues before the Court of Appeal included whether practical completion had been achieved under the building contract, the legal effect of the independent certifier's certificate in light of the rescission of an associated agreement, and whether the guarantors were liable under their guarantees when the principal building contract was automatically rescinded. The court also considered whether the doctrine of conventional estoppel could be invoked against the parties and whether it could extend to affect the liability of the guarantors. Finally, the court addressed issues relating to costs, including the reasonableness of separate representation for different guarantors and the recoverability of those costs.

The Court of Appeal reasoned that the primary judge had correctly determined that practical completion had not been achieved. The court found that the rescission of the associated agreement had the effect of vitiating the independent certifier's certificate, meaning it could not be relied upon to establish practical completion. Regarding the guarantees, the court held that the automatic rescission of the principal contract meant the guarantors were not liable. The court also found that the elements of conventional estoppel were not made out, as the party alleged to be estopped had not played a relevant part in the adoption of the assumption. Consequently, the appeals were dismissed in part and allowed in part, with specific orders made regarding costs.