Yisheng Construction Pty Ltd v City Garden Australia Pty Ltd

Yisheng Construction Pty Ltd and Yisheng Air Con Pty Ltd (the appellants) appealed to the Court of Appeal of the Supreme Court of New South Wales against a decision of the Equity Division. The dispute concerned the calculation of amounts owing by City Garden Australia Pty Ltd (the respondent) to the appellants under payment schedules, where the respondent had promised to pay amounts owing by a builder to subcontractors. The appellants contended that the respondent had failed to pay the full amounts due under these payment schedules, after accounting for payments already made.

The central legal issues before the Court of Appeal were whether the term "previous payment" as used in the respondent's payment schedules referred to payments actually paid to the subcontractors, and whether the appellants' calculation of loss or damage in their final submissions was sufficiently pleaded or otherwise properly run at trial. The court also considered whether the payment schedules themselves, as business records, required further proof of their contents beyond their authenticity and sufficiency.

The Court of Appeal reasoned that the term "previous payment" in the context of the payment schedules clearly referred to payments that had been made. The court found that the appellants' case in their final submissions, which involved deducting amounts paid from the total amounts owing under the payment schedules, was not materially different from what had been pleaded or run at trial, and that the respondent had received sufficient notice of this approach. The court also held that as the authenticity and sufficiency of the payment schedules were not in issue, there was no need to prove extraneous matters disclosed within them.

Consequently, the Court of Appeal allowed the appeal, set aside the orders of the Equity Division, and entered judgment in favour of Yisheng Construction Pty Ltd for $667,140 and Yisheng Air Con Pty Ltd for $113,255. The respondent was ordered to pay the appellants' costs of the proceedings in the Equity Division and the costs of the appeal.