Supreme Court
New South Wales
Medium Neutral Citation: Taylor Construction Group Pty Ltd v Adcon Structural Group Pty Ltd [2023] NSWSC 723 Hearing dates: 22 June 2023, last submissions 23 June 2023 Date of orders: 27 June 2023 Decision date: 27 June 2023 Jurisdiction: Equity - Technology and Construction List Before: Rees J Decision: Permanent injunction and declaratory relief.
Catchwords: SECURITY OF PAYMENT ACT– construction contract terminated – subcontractor serves payment claim – contractor serves payment schedule disputing validity of payment claim – subcontractor serves another payment claim without withdrawing the earlier claim – s13(1C), Building and Construction Industry Security of Payment Act 1999 – contractor now says earlier payment claim was valid – whether contractor can ‘approbate and reprobate’ – s13(1C) applies to preclude later payment claim.
CONTRACT – contractor purports to terminate contract – subcontractor elects to affirm – contractor reasserts that contract is terminated – subcontractor elects to terminate – whether termination effective – is later repudiation “distinguishable” from earlier breach – GEC Marconi v BHP – principles at [25]-[32] – later breach need not be breach of different obligation or breach of same obligation by different means – sufficient if later breach is temporally distinguishable, occurring on a separation occasion.
Legislation Cited: Building and Construction Industry Security of Payment Act 1999 (NSW) ss 13(1C), 13(2)
Cases Cited: Ailakis v Olivero (No 2) [2014] WASCA 127; (2014) 100 ACSR 524
AllianzAustraliaInsuranceLtdvDelorVueApartmentsCTS39788 (2022) 406 ALR 632; [2022] HCA 38
Autodesc Inc v Dyason (No 2) (1993) 176 CLR 300; [1993] HCA 6
BCFK Holdings Pty Ltd v Rork Projects Pty Ltd [2022] NSWSC 1706
Carr v J A Berriman Pty Ltd (1953) 89 CLR 327; [1953] HCA 31
GECMarconiSystemsPtyLtdvBHPInformationTechnologyPtyLtd (2003) 128 FCR 1; [2003] FCA 50
Kitchen Xchange v Formacon Building Services [2014] NSWSC 1602
Larking v Great Western (Nepean) Gravel Ltd (1940) 64 CLR 221; [1940] HCA 37
NC Refractories Pty Ltd v Consultant Bricklaying Pty Ltd [2013] NSWSC 842
Ogle v Comboyuro Investments Pty Ltd (1976) 136 CLR 444; [1976] HCA 21
Rojo Building Pty Ltd v Jillcris Pty Ltd [2006] NSWSC 309
The New South Wales Netball Association Ltd v Probuild Construction (Aust) Pty Ltd [2015] NSWSC 1339
Category: Principal judgment Parties: Taylor Construction Group Pty Ltd (Plaintiff)
Adcon Structural Group Pty Ltd (Defendant)Representation: Counsel:
Solicitors:
Mr D Byrne (Plaintiff)
Mr F Hicks SC / Ms D Levi (Defendant
HWL Ebsworth Lawyers (Plaintiff)
Roberts Legal (Defendant)
File Number(s): 2023/188806
Judgment
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HER HONOUR: The plaintiff contractor, Taylor Construction Group Pty Ltd, seeks to permanently injunct the defendant subcontractor, Adcon Structural Group Pty Ltd, from making adjudication applications under the Building and Construction Industry Security of Payment Act 1999 (NSW) (SOPA). Adcon served two payment claims in May 2023 in respect of construction work undertaken on projects in Banksmeadow and Ingleburn respectively.
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The injunction is sought on the…
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- Case
- [2023] NSWSC 723
- Decision Date
CaseChat Overview and Summary
The court found that Taylor's changing position on the validity of the payment claim was impermissible and that section 13(1C) of the Security of Payment Act precluded Adcon's later payment claim. The court held that Taylor could not approbate and reprobate, and that Adcon's later payment claim was invalid. Regarding the contract's termination, the court determined that Taylor's second repudiation was not distinguishable from the initial breach, following the principles outlined in GEC Marconi v BHP. The court concluded that Adcon's election to affirm the contract upon the first repudiation prevented it from terminating the contract after the second repudiation.
As a result, the court ruled in favour of Taylor on both issues. The later payment claim was deemed invalid, and the contract remained effective despite Taylor's repudiation. The final orders of the court were that Adcon's second payment claim was invalid and that the construction contract between the parties remained in force.
Orders
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Background
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