No. 1403 – 26 September 2014
The principal sometimes delays a construction project and in doing so breaches the building contract. If the contract terms allow the principal to then deduct liquidated damages from the contractor’s final payment because the project runs late, is this legal? The answer may depend on whether the contractor asked for an extension of time and on where the work is being done. Read our Update on the prevention principle and time bar clauses.
No. 1404 – 5 September 2014
The NT Supreme Court has very recently clarified how the Construction Contract (Security of Payments) Act operates when a payment claim is ignored. In the similar legislation applicable in SA and the Eastern States, contractors have to promptly respond to a payment claim with a payment schedule to avoid liability for the full amount of the claim. The NT and WA adopted a less stringent regime and it has not been clear what liability arises when a payment claim is ignored. That situation has now changed.
No. 1402 – 22 August 2014
Commercial construction contracts often include time bar clauses, requiring the contractor to give prompt notice of any possible delay to practical completion.
Failure to give notice within the time allowed is sometimes relied on to deny the contractor an extension of time. In this Update we discuss recent developments that may cast doubt on the validity of some time bar clauses.
No. 1401 – 15 August 2014
In this Update we look at the liability of subcontractors for poor workmanship and whether the head contractor is required to closely monitor their workmanship to avoid liability for negligent work.
14 August 2014
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13 August 2014
To better service our growing Northern Territory practice, we have opened an office in Darwin. Our Darwin Office contact details are: Paspalis Centrepoint Building Level 1, 48-50 Smith Street, Darwin NT 0800 Telephone: 08 8943 0698, Fax: 08 8941 0848
No. 1305 – 17 September 2013
Update 1305 reports on Romaldi Constructions’ ongoing battle with its subcontractor over an adjudication.
Romaldi applied to the District Court after its subcontractor obtained a determination from an adjudicator that it should pay money to the subcontractor. The District Court made orders that Romaldi did not have to pay the money to the subcontractor and instead could pay it into Court. The Court was then going to decide who should get the money. The subcontractor appealed to the Supreme Court and Justice Anderson has recently handed down the decision we report on.
Justice Anderson’s decision has wide implications for subcontractors and head contractors as to the power of the new adjudication regime and in effect restores faith in the new regime. We have recently learned that Romaldi has appealed the decision of Justice Blue to the Full Court of the Supreme Court of South Australia.
No. 1306 – 29 August 2013
Construction Law Update 1306 is the first in a series of Updates on recent Court decisions likely to impact on the operation of South Australia’s new adjudication legislation. Fenwick Elliott Grace acted for Built Environs in the first Supreme Court challenge to an adjudicator’s determination on the basis of a breach of natural justice, bias and other grounds. Justice Blue has carefully examined the Protectavale case and found that cumulative progress claims are permissible where the contract allows for them. The Court’s decision shows that consultants with links to nominating authorities must look for potential conflicts of interest when they advise clients.
No. 1304 – 14 August 2013
Construction Law Update 1304 reports on how expert evidence is to be presented at trial. Generally, evidence at trial must be given by persons who saw or heard what happened and their opinions are not accepted by the Court. An exception to this rule is made when the Court allows an expert witness to give evidence. However, in order to fall within the exception, the expert’s report and evidence must comply with the rules of Court. Update 1304 looks at some recent cases where expert evidence has been disallowed due to failures to comply with the rules.
No. 1303 – 28 June 2013
In our current Update No. 1303, we report on a recent Federal Court decision dealing with the limited bases upon which a Court will prevent a principal from calling on a bank guarantee in the context of a construction contract.
No. 1302 – 20 May 2013
This Update reports on a further aspect of the recent Alstom decision dealing with the refurbishment of Playford B power station in South Australia. We have previously reported on the nature of the subcontract and on the obligation of a head contractor to provide a detailed works program to the subcontractor. In this Update, we discuss a new approach to the classification of compensation for breaches of contract.
No. 1301 – 10 April 2013
This Update reports on a further aspect of the recent Alstom decision dealing with the refurbishment of Playford B power station in South Australia. We previously reported in Update 1201 on the nature of the subcontract. This Update deals with the extent of the obligation of a head contractor to provide a detailed works program to the subcontractor.
No. 1202 – 2 October 2012
This Update reports on a recent NSW Court of Appeal decision dealing with payment for construction work performed without a contract.
Courts have often adopted the view that work performed by a builder for an owner in the absence of a contract enriches the owner. It is often said that it would be unfair or unjust for the owner to retain the benefit without paying the builder. Principles of fairness and equity can then be applied by the Court to require the owner to pay the builder a fair amount for the benefit they have received.
However, the position is not clear cut. For example, if the owner did not request the work to be done, or reasonably thought that the work was being performed at no charge, the builder will be unlikely to succeed in making a claim. Update 1202 discusses the construction of a roundabout and the refusal of one of the parties to pay for the cost, even though the roundabout was essential to both parties as it was a condition of development approvals for their respective neighbouring properties. The case raises an interesting issue as to whether reliance by the builder on receiving payment for the work is an essential element to ensure recovery.
22 June 2012
Parts 4 and 5 of our new video series on the practicalities of the Building and Construction Industry Security of Payment Act 2009 (SA) are now online.
No. 1201 – 21 June 2012
Alstom v Yokogawa involved a dispute over a $33 million subcontract to refurbish the electrical control system of the Playford B power station in South Australia. Many legal issues that frequently arise in construction disputes are canvassed in the decision. In this Update we look only at the issue of whether incorporating all of the terms of the head contract into the subcontract and then making specific amendments to selected terms and definitions was enough to make the subcontract “back to back”. “Back to back” contracts attempt to pass the head contractor’s risk down the line to the subcontractor.
5 June 2012
There are some seminal decisions in the area of construction law that are remarkably pithy, but the decision of Justice Bleby in Alstom Ltd v Yokogawa Australia Pty Ltd (No 7)  SASC 49, in which judgment was delivered on 2 April 2012, is not one of them. The judgment runs to 461 pages, and […]
22 May 2012
The Society of Construction Law Australia is bringing together a panel on the evening of 12 June 1012 to discuss early warning signs in projects, including real examples of where management strategies have been Good, Bad or Ugly, which will be followed by a networked event with participants from around the world. In the UK, […]
16 April 2012
The Australian Legislation Reform Subcommittee of SoCLA, now under the chairmanship of Robert Fenwick Elliott, is seeking to gather as much data as possible on how the various models for construction adjudication around Australia are working. If anyone has been involved in an adjudication – in any State or Territory, either as claimant or respondent, […]
13 March 2012
There are still a few last minute entries coming in for the joint Law Society/SA Bar Association Adjudicator Training Course, designed for those who would like to be on the new JANA Panel of Adjudicators. The course runs from lunchtime this Thursday, 15th March, to Saturday lunchtime. The course presenters are Professor Rashda Rana from […]