Probuild Constructions (Aust) Pty Ltd v DDI Group Pty Ltd

The dispute in *Probuild Constructions (Aust) Pty Ltd v DDI Group Pty Ltd* concerned a payment claim made by DDI Group Pty Ltd (the respondent) under the *Building and Construction Industry Security of Payment Act 1999* (NSW) for renovation works carried out for Probuild Constructions (Aust) Pty Ltd (the appellant). The appellant sought to reduce the payment claim to nil by claiming set-off for liquidated damages due to the respondent's alleged delay in completing the works. The matter came before the Court of Appeal of New South Wales.

The primary legal issues before the Court of Appeal were whether the adjudicator, in rejecting the appellant's claim for liquidated damages, had wrongly applied the prevention principle, and if so, whether this constituted a denial of procedural fairness to the appellant. The court also considered the impact of variations directed by the principal after the date for practical completion and the fact that practical completion was ultimately achieved 114 days late.

The Court of Appeal held that the adjudicator had correctly applied the prevention principle. This principle dictates that a party cannot rely on a breach of contract by the other party to found a claim for damages if the first party's own conduct prevented the other party from performing their obligations. In this instance, the appellant's direction of variations after the date for practical completion was found to have prevented the respondent from achieving practical completion by the stipulated date. Consequently, the appellant was not entitled to claim liquidated damages for the delay. The court found no denial of procedural fairness, as the appellant had been given an opportunity to present its case regarding the liquidated damages claim.

The appeal was dismissed, and the appellant was ordered to pay the costs of the appeal.