R Developments Pty Ltd v Forth

The appeal concerned a dispute between R Developments Pty Ltd (the builder) and the owner of a property (the owner) regarding a standard form building contract. The primary judge had dismissed the builder's claim for damages for breach of contract, finding that the builder was not entitled to terminate the contract. The builder appealed this decision to the Supreme Court of the Australian Capital Territory.

The central legal issues before the Court were the interpretation of specific clauses within the standard form building contract, particularly concerning the owner's obligation to provide evidence of their capacity to pay and the builder's right to terminate the contract for non-compliance. The Court was required to determine whether the owner's obligation to supply such evidence had ended, whether the builder had waived this requirement, and whether the builder had validly invoked further contractual clauses relating to alleged breaches.

The Court reasoned that the owner's obligation to provide evidence of capacity to pay ceased once the builder commenced the works, a point which had been reached. Furthermore, the Court found that the builder had waived this particular obligation. The Court also noted that the builder had not invoked a further contractual clause that would have allowed them to demand such information, and that the notice provided by the builder did not adequately identify the alleged breach. Consequently, the Court held that the builder was not entitled to terminate the contract.

The appeal was dismissed with costs.