Total Construction Pty Ltd v Kennedy Civil Contracting Pty Ltd (subject to a Deed of Company Arrangement) (No 2)

Total Construction Pty Ltd appealed to the Court of Appeal of New South Wales against orders made by the District Court in proceedings brought by Kennedy Civil Contracting Pty Ltd. The dispute concerned the repayment of a sum of money held by Kennedy Civil Contracting Pty Ltd under a Deed of Company Arrangement.

The Court of Appeal was required to determine whether the District Court had erred in its previous orders, particularly concerning the entitlement to the sum of $591,308.52 and the consequential orders for repayment and interest. The central legal issue revolved around the proper application of the terms of the Deed of Company Arrangement in relation to the funds held by Kennedy Civil Contracting Pty Ltd.

The Court of Appeal found that the District Court had made errors in its previous orders. It reasoned that the sum of $591,308.52 was held by Kennedy Civil Contracting Pty Ltd upon trust pursuant to the Deed of Company Arrangement, and that Total Construction Pty Ltd was entitled to its repayment. Consequently, the Court of Appeal set aside the earlier District Court orders and entered judgment for the defendant, Total Construction Pty Ltd. The Court ordered Kennedy Civil Contracting Pty Ltd to repay the principal sum, along with specified interest, and remitted the question of costs at first instance back to the District Court for determination.