Walter Construction Group Ltd v Walker Corporation Ltd

Walter Construction Group Ltd brought an action against Walker Corporation Ltd in the Supreme Court of New South Wales, alleging breaches of a construction contract and seeking various remedies. The dispute arose from a contract for the construction of a residential building, where the parties entered into a construction deed that included provisions for liquidated damages in the event of delays. The deed was later varied orally to waive the liquidated damages clause, which was subsequently repudiated by Walker Corporation. Walter Construction claimed that the repudiation allowed them to terminate the contract and seek damages.

The court was required to determine whether the oral variation of the construction deed was valid and enforceable, and whether Walker Corporation's repudiation constituted a breach of contract that entitled Walter Construction to terminate the contract and claim damages. Additionally, the court had to consider the proper measure of damages and the incidence of GST on the judgment amount. The central issue was whether the parties had effectively waived their rights to rely on common law and contractual limitations on the oral variation of the deed, and whether Walker Corporation's actions amounted to a repudiation of the contract.

The court held that the oral variation of the construction deed was valid and enforceable, as the parties had waived their rights to enforce the common law and contractual restrictions on such variations. The court found that Walker Corporation's insistence on an impossible standard of practical completion and their refusal to certify work as complete did not reflect a bona fide belief in that standard, amounting to a repudiation of the contract. Consequently, Walter Construction was entitled to terminate the contract and claim damages on a quantum meruit basis. The court determined that the GST was not payable on the judgment amount as it did not represent a supply of goods or services under the GST legislation.

The court ordered Walker Corporation to pay Walter Construction the sum of $1,200,000, plus interest, as damages on a quantum meruit basis. The court further ordered that no GST was payable on the judgment amount. The judgment was made enforceable as a judgment debt of the defendant.