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CITE

Unreported Judgment

Nortask Pty Ltd v Clarke Energy (Australia) Pty Ltd[2017] QDC 268McGill DCJ
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Nortask Pty Ltd v Clarke Energy (Australia) Pty Ltd[2017] QDC 268

DISTRICT COURT OF QUEENSLAND

CITATION:	Nortask Pty Ltd v Clarke Energy (Australia) Pty Ltd [2017] QDC 268
PARTIES:	NORTASK PTY LTD (plaintiff) v CLARKE ENERGY AUSTRALIA PTY LTD (defendant)
FILE NO/S:	D 179/2013
DIVISION:
PROCEEDING:	Civil Trial
ORIGINATING COURT:	District Court at Brisbane
DELIVERED ON:	3 November 2017
DELIVERED AT:	Brisbane
HEARING DATE:	4-6, 10, 11 October, 1, 2 November 2016
JUDGE:	McGill SC DCJ
ORDER:	Judgment that the defendant pay the plaintiff $500,666.06, including $148,093.35 by way of interest.
CATCHWORDS:	BUILDING AND ENGINEERING CONTRACTS – Offer and acceptance – whether contract made when quotation accepted – whether superseded by formal contract. BUILDING AND ENGINEERING CONTRACTS – Terms of contract – whether plaintiff told to quote on a particular basis – whether quote on that basis – whether basis of quote part of contract. BUILDING AND ENGINEERING CONTRACTS – Variations – whether latent condition – whether work done not covered by contract – amounts payable for variations. AAI Ltd v Marinkovic [2017] QCA 54 – applied. Australian Broadcasting Commission v Australasian Performing Right Association Pty Ltd (1973) 129 CLR 99 – applied. Commercial Bank of Australia Ltd v GH Dean & Co Pty Ltd [1983] 2 Qd R 204 – cited. Daysea Pty Ltd v Watpac Australia Pty Ltd [2001] QCA 49 – cited. Dillingham Constructions Pty Ltd v Downs [1972] 2 NSWLR 49 – applied. Equuscorp Pty Ltd v Glengallan Investments Pty Ltd [2002] QCA 380 – cited. Ermogenaus v Greek Orthodox Community of SA Inc (2002) 209 CLR 95 – distinguished. King Tide Co Pty Ltd v Arawak Holdings Pty Ltd [2017] QCA 251 – cited. MJ Arthurs Pty Ltd v Isenbert [2017] QDC 85 – applied. Martinek Holdings Pty Ltd v Reed Construction Qld Pty Ltd [2009] QCA 329 – cited. Masters v Cameron (1954) 91 CLR 353 – applied. Mermaids Café and Bar Pty Ltd v Elsafty Enterprises Pty Ltd [2010] QCA 271 – cited. Morrison-Knudsen International Co Inc v The Commonwealth (1972) 46 ALJR 265 – cited. Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 – applied. Pavlovic v Universal Music Australia Pty Ltd (2015) 90 NSWLR 605 – distinguished. South Coast Oils (Qld and NSW) Pty Ltd v Look Enterprises Pty Ltd [1988] 1 Qd R 680 – cited. Thiess Services Pty Ltd v Mirvac Qld Pty Ltd [2006] QCA 50 – cited. Wharf St Pty Ltd v Amstar Learning Pty Ltd [2004] QCA 256 – cited.
COUNSEL:	S J Armitage for the plaintiff N H Ferrett for the defendant
SOLICITORS:	Clifford Gouldson Lawyers for the plaintiff Hopgood Ganim for the defendant

[1]
In early 2007 the parties entered into a contract under which the plaintiff agreed to carry out for the defendant certain civil construction work at a site near Mt Isa for a particular contract price. The work required under the contract was subsequently undertaken, but the plaintiff made a number of variation claims, and not all were accepted by the defendant. In this proceeding the plaintiff claims payment or additional payment in respect of six particular variation claims made by it on the defendant. The entitlement to each claim is in issue between the parties, both as to liability and quantum, although the focus of the defence was on the former.

Background

[2]
The defendant was the head contractor for the construction of an electricity generating facility at a mine site near Mt Isa. In late 2006, following a phone call to the plaintiff, the defendant sent an email dated 16 December to the plaintiff enclosing a request for quotation, a scope of work specification and some drawings, some of which were hand drawn preliminary sketches for the foundations, inviting the plaintiff to start work on a quotation for “civil work”.^[1]

[3]
The site in question was one which had previously been filled, and was the subject of a geotechnical report prepared after a number of test pits were dug on the site: Exhibit 1. It is common ground that the full report was not provided to the plaintiff at any relevant time. There is a dispute between the parties as to whether the plaintiff ever requested the report: the plaintiff’s witnesses said they asked for a copy of the geotechnical report and were told either that the information provided on a diagram in relation to the test pits which had been dug for the purpose of that report was adequate for their purposes, or that the defendant did not have a copy of the report.^[2]That there was a geotechnical report in existence was communicated to the plaintiff by an email, Exhibit 6, which mentioned the report.^[3]The defendant’s witness said that no request for a copy of the report was ever made by the plaintiff.^[4]

[4]
Because the site had previously been filled, a civil engineer, when preparing the design for the foundations of some concrete slabs on which generating machinery was to be placed, decided that they would sit on a series of trench piers which were to be dug through the fill, to a depth which penetrated the natural ground level by 300 mm.^[5]That was reflected in the hand drawn preliminary sketch prepared by the engineer and provided with Exhibit 5 to the plaintiff. That sketch indicated that the depth of fill to be penetrated in order to reach natural ground level varied but that the plaintiff was to assume an average depth of two metres. After the trench piers had been put in position, concrete slabs which incorporated reinforced concrete beams, which came in two sizes, were to be constructed sitting on top of the piers and supported by them, so that the generating machinery could sit securely on the slabs. The design for the power station provided for 11 such generator units to be constructed, with space for three additional units to be installed in the future.

[5]
On 20 December 2006 the defendant requested a price for one such slab, giving a breakdown of the cost separately for what was described as “trenched piers (type B footings – you need to refer to geotechnical report to clarify depth)” and “top slab including (type A footings included)” (sic): Exhibit 6. The email indicated that the total was to be the total for each engine enclosure slab. This involved some misreading of the drawings, since the trench piers were separate from the type B footings; the type A footings and type B footings were areas of the concrete slab where it thickened out into the equivalent of beams under the slab, with type A footings running along the long section of the slab, and type B footings running across the slab, two of which extended out under a side projection, and were connected by another slab footing.^[6]

[6]
The difference was that the type B footings were slightly deeper and slightly wider than the type A footings,^[7]and the layout was set up so that it was only type B footings that rested on the trench piers. The type A and type B footings would be cast with the slab,^[8]but the trench piers were cast separately, before the footings and slab. Accordingly, describing the trench piers as type B footings does not make sense, and indicates a misunderstanding of the drawing by Mr Evans.^[9]The reference to the geotechnical report in the email was also curious: it was common ground that the principal had obtained a geotechnical report into the site, and also that a copy of this had not been provided to the plaintiff by this time, nor indeed was one provided at any time during the contract works. For the purposes of this quote however it was not necessary to refer to the geotechnical report because attached to the email was another copy of the same drawing which again directed the plaintiff to “allow two metre average” for the depth of the fill.^[10]

[7]
At one point the managing director of the plaintiff suggested that he interpreted the email, Exhibit 6, as requesting a price only for the slab and type A and type B footings: p 61, 62. That does not strike me as a natural reading of the defendant’s email. The plaintiff in fact prepared a breakdown price for one enclosure slab in the format requested and sent it later that day by email to the defendant: Exhibit 7. I note that this email described the two parts as the trench piers and the top slab, indicating an understanding that the latter included type A and type B footings. Further, the figures are very close to the calculations per slab in an internal document of the plaintiff prepared later which gave a figure separately for the trench piers, and for the slab including the type A and type B footings: Exhibit 51. The defendant’s response was that the figures “appear higher than we expected”: Exhibit 8. The defendant pointed out that the quote for top surface coating for one slab was more than the total amount paid for coating 11 such slabs at another similar project recently completed, and foreshadowed issuing a full request “for a fixed price quotation,” adding that they wanted “first time around… your best price.”

[8]
The following day the defendant sent to the plaintiff two further emails (Exhibits 9 and 10) enclosing some documentation which was to be used “to provide a fixed price quotation for all the civil works associated with X41 power station...by 15 January 2007”. The email told the plaintiff to “disregard all prior documentation…” Attached to the email Exhibit 9 apparently were two copies of the specification revised as at that date, a “request for quotation” and two site maps.^[11]Attached to the Exhibit 10 email were 8 drawings.

[9]
The request for quotation document identified that “the following documents that form part of this inquiry are enclosed,” though only the first, the specification, was enclosed; drawings as listed in the specification were enclosed with the email in Exhibit 10. The request went on to list as requirements: “please ensure that your offer includes all the details listed in the attached specification” and “your offer should cover compliance in every respect of the specification and all non-conformances shall be clearly identified”. The specification said that it specified the general requirements for the Scope of Civil Works for the X41 power station project, and under heading 2.0, that “the civil subcontractor is responsible for compliance of all work required to meet the requirements of this specification…[and statutory and xstrata standards]…It is the intent of this scope of work to cover all civil works which include but not necessarily limited to the following:”^[12]There were then listed 14 specific matters, including “(c) supply and compaction of suitable fill, achieving specified levels” and “(n) installation and testing of earth grid…”. It was then said that a list of 8 specific diagrams “cover the detailed specifications and requirements”.^[13]Clause 11 required certain documentation to be supplied by the vendor as a minimum, including at 11.2, a price schedule. Paragraph 11.2 set out a blank price schedule with 11 specific items, though one of them “8 - fencing” was marked “N/A” [not applicable], with a twelfth line “Total (excluding GST)”.

[10]
On 15 January 2007 the defendant sent the plaintiff an email, Exhibit 12, with a number of photographs showing the site, which were said to show that it was close to being level, and added:

“Please base your quotation on shaping the site only and do not allow for bringing in or taking any fill away for the base under the crushed rock. We will set the levels on site to suit existing levels”.

[11]
I assume that this was sent before the first tender was submitted. Mr Evans said that this was consistent with the design intention throughout, which was that the design levels would be adjusted to whatever surface level was achieved by the cut and fill process of reshaping the site: p 4-55. That is inconsistent with para 2.0(c) of the specification in Exhibit 9.

[12]
On 15 January 2007 the plaintiff provided a tender submission comprising three pages: a letter stating the contract total price and GST, a copy of the price schedule which was based on the form of price schedule in paragraph 11.2 of the specification enclosed with Exhibit 9, and a page setting out a schedule of rates for variations to the contract, following the form of the schedules in clause 11.3 of the specification: Exhibit 11. The price schedule followed paragraph 11.2 except that “detailed drawings” was inserted as item one,^[14]there was a separate amount quoted for “footing” which was included in the “formwork reinforcement and concrete” item, the item “fencing”, marked as “NA” in the schedule in paragraph 11.2 was omitted, and the items for supply and spreading of gravel and chip sealing the site were marked “(sub-contract)”. Each item had a figure next to it as “lump sum price” and there was a total shown which was the sum of the 11 lump sum prices.

[13]
The letter stating the total price included three dot points. The first was:

“As per our telephone conversation on 15 January 2006 (Kamali, Evans) no allowances have been made for imported fill materials. The final level is to be achieved by shaping the existing ground surface.”

[14]
The second dot point indicted that the figure for detailed design drawings was an estimate only and the plaintiff was proposing to do this work on a cost plus basis, another departure from the specification. The third dot point stated:

“Due to constructability problems the contractor has allowed to backfill trench footings using lean mix concrete.”

The significance of this is that the drawings included in Exhibit 10 provided for N20 concrete to be used for the trench piers, and N32 concrete which was stronger for the rest of the slabs. In the final drawings lean mix concrete, N15, was adopted for the trench piers: Exhibit 14 drawing CO241-CF-006 Revision C, para C9. This occurred after Mr Evans discussed this proposal with the design engineer.^[15]

[15]
There was a conflict of evidence between the parties as to what happened after the first tender was submitted. Mr Kamali, for the plaintiff, said that he was telephoned by Mr Evans who told him the tender was too high, and there was some discussion about items in the quote: p 55. This extended to taking some items out of this contract, and in addition there was some discussion about the amount allowed in the tender for “footings”, that is to say, for the trench piers. Mr Kamali said that he had allowed for piers to a depth of about 3.5 metres in accordance with the drawing, and said that MrEvans told him to allow only two metres average depth of the piers: p 55, 56. MrKamali said that he told the managing director, Mr Speziali, who then also telephoned Mr Evans and was told the same thing: p 56. Mr Speziali gave evidence to the same effect,^[16]and added that at this point he asked for a copy of the geotechnical report (p 3-8), and was told by Mr Evans that all the information that the plaintiff needed from that report was on the drawings.

[16]
Mr Speziali said that he subsequently telephoned Mr Leong, the defendant’s engineering manager, who was the person identified on the front page of the scope of work specification for technical enquiries, who told him he did not have a copy of a geotechnical report for the site. Mr Leong denied that he had ever had any conversation with Mr Speziali about anything: p 4-60. Mr Evans also denied that he made the statements attributed to him;^[17]his evidence was that he had no clear recollection of any particular conversations with the plaintiff between the first and the second tender:^[18]. At one point he said he would have sent an email if there was a discussion (p 5-41), so the absence of any email suggested the absence of any discussion. He agreed however that there had been some items of work deleted from the specification between the first and second tender, and conceded it was likely that there was some conversation about that.^[19]There is an email suggesting a phone call between Mr Evans and Mr Kamali on 16 January 2007: Exhibit 74. I deal elsewhere with the question of credibility, but bearing that in mind, and two other matters, I prefer the evidence of the plaintiff’s witnesses about the conversation with Mr Evans, and find that the plaintiff was told, on behalf of the defendant, to base its price on an average pier depth of two metres.

[17]
The two other matters are, first, that Mr Evans in the witness box did say that it was his view that the plaintiff had, in the information about the results of the test pits contained on one of the drawings, all the information from the geotechnical report that it needed for the purposes of preparing its quote: p 5-10. Drawing C0241-CF-001 in Exhibit 10 shows nine test pits and records for each of them the depth of the natural ground and the depth of dense colluvium soils, both measured below the existing ground surface.^[20]The nine figures for depth to natural ground in fact have an average of 2.12 metres, so a superficial view of the information provided would be that the average depth of the trench piers would be two metres.

[18]
This would be a very superficial view, for three reasons: first, because three of the nine test pits were dug away from the area where the trench piers were to be constructed. The average of the relevant six is 2.48 m. Second, the trench piers were to penetrate at least 300 mm into the natural ground surface, as shown on the drawings,^[21]and “natural ground” was defined there as ground sufficient to sustain a bearing pressure of 150 kilopascals^[22]whereas there is nothing in the geotechnical report Exhibit 1 that I can find which confirms that what was identified as natural ground in the test pits supported a bearing pressure of 150 kilopascals.^[23]Also, the requirement that the resistance at the base of the trench be certified by an appropriately qualified person suggests that the designer was not proceeding on the assumption that penetration of 300 mm into the natural ground level would necessarily produce a base with sufficient bearing resistance.

[19]
The third consideration is that 2.17 metres was the depth below the existing surface,^[24]but what mattered in the construction of the trench piers was the surface level achieved after the site preparation earthworks were completed.^[25]That would have altered the existing levels from which the test pit measurements were taken. According to the drawings, the top of the trench piers was 675 mm below the top of the concrete slab, that is 675 mm below RL 47.15, except under the end of the extension to the side of each slab, where it was below RL 47.05.^[26]Drawing CO241-CF-001-D showed a design finished surface level as I understand it for the ground surrounding the slabs of RL 46.90 to RL 47.05,^[27]but the existing ground levels in that area, shown on drawing CO241-CEW-001, ranged from 47.4 to 46.0.

[20]
The matter is complicated by the fact that there was evidence from Mr Speziali that the level achieved on the site for the surface level was below the design level, because the amount of material available from cutting the higher part of the site was not sufficient to raise the lower parts of the site to that design level. His evidence was that the surface level achieved was about 200 mm below the design surface level^[28]but Mr Kamali gave a figure of 100 mm,^[29]and that was the basis of the plaintiff’s claim. The only other evidence about this was evidence from Mr Evans that some parts of the site were lower that the design level because of the shortage of fill, but that this did not extend to the area where the engine slabs were constructed: p 5-66. Bearing in mind my findings on credibility, and the analysis later, I reject this evidence and find that the levels of the whole site were lower, as contemplated in Exhibit 12. For the purpose of this exercise, I accept the evidence of MrSpeziali that the level was 200 mm lower. This meant that the finished surface levels for the engine slab area were RL 46.70 to RL 46.85.^[30]

[21]
The matter is further complicated by the fact that the plaintiff maintains that it was instructed to keep to the RL levels shown in the drawings for the tops of the slabs,^[31]and that, as a result of the lowering of the site, the slabs had to be made thicker, for which a variation was claimed.^[32]Broadly speaking the adjustment to preserve the level of the tops of the slabs was made by thickening the slab, rather than by raising all the elements of the design including the top of the trench piers, which would have made the trench piers longer. Hence the top of the trench piers was not 675 mm below the ultimate top of the slab, but below where the top of the slab would have been if it had not been adjusted to preserve the RL of the design, essentially 200 mm lower.

[22]
If the RL of the existing surface at the site of the test pit were known, it would be possible to derive the RL for the natural ground level detected by the test pit, but the individual test pit reports in Exhibit 1 do not state a surface RL: that part of the form was left blank. All that can be said is that the test pits lie between certain RL contour lines for the original surface marked on drawing CO241-CEW-001,^[33]an exercise which is complicated by the fact that the test pit locations are not marked on that drawing, but on C0241-CF-001. The contour lines are .2 of a metre apart vertically, and are I suspect only approximate, although there was no evidence as to the level of accuracy to be expected from such dimensions.^[34]

[23]
Accordingly at the site of a test pit the RL of the natural ground level will be the RL of the existing surface (RLX- to be estimated from the survey contours) minus the depth to the natural ground found on excavation (DNG), both of which will vary from pit to pit. The depth of the trench pier however will run from the base of the type B footing,^[35].675 below the RL of the top of the slab if the top of the slab had been adjusted to accommodate the change in the surface level, that is RL 46.95,^[36]so that the top of each trench pier will be at RL 46.275.^[37]The depth of the excavation would therefore be at RL 46.275 minus the RL of the natural ground plus the depth to natural ground, plus 300 mm for the minimum penetration into the natural ground level. Hence the excavation depth can be found from the formula: 46.575 + DNG - RLX.

[24]
To pick an example for this, test pit three was dug essentially on the site of one end of one of the trench piers under the slab for engine 5, and on the basis of the contour lines, the original surface at that point was close to RL 46.80. The natural ground was found at a depth of 2.1 metres, so the RL of the natural ground at that point was RL 44.7. Assuming that it had an adequate bearing capacity, that meant the trench pier would be 1.575 metres deep to that point, but because it needed to extend 300 mm further into the ground, it would be 1.875 metres deep.^[38]

[25]
Several things need to be said about this figure however. In the first place, test pit three found natural ground level at a relatively shallow depth within the relevant six test pits, so this is an atypical result. The second is that it is only possible to work this out with such degree of precision because test pit three happened to lie on the site of one of the trench piers, but it and test pit two are the only test pits in such a position, or even close to such a position,^[39]so far as I can tell from the drawing. Given the very limited number of relevant test pits and their distribution, the estimation of the depth of the natural ground level under this site was largely a matter of guesswork for someone in the position of the plaintiff.

[26]
Apart from that, the formula I have derived is one that can only be applied with hindsight. My calculation of the level of the top of the trench piers is derived from the RL of the surface of the site after the initial earthworks to level it had been carried out. As noted earlier, those initial earthworks were to be based on levelling the site with such fill as was available from the site, without importing or exporting fill, and the plaintiff was told that the RL of the finished surface would be adjusted accordingly to accommodate this: Exhibit 12. One of the figures I have used in that calculation was based on the RL of the top of the slab after construction,^[40]but that would not have been known at the time when the plaintiff was being asked to produce its quote. So on the information available to the plaintiff it was necessarily impossible to determine with precision the depths of the trench piers that the plaintiff was being asked to quote to construct.

[27]
In these circumstances, there are really only two sensible ways in which a quote can be provided by someone in the position of the plaintiff: the contractor can make a generous allowance to cover the contingencies likely to be faced as a result of the uncertainty, or the contractor can quote on an assumed depth, on the basis that any variation from this will be accommodated by a variation under the contract.^[41]The plaintiff was asked to proceed on the latter basis when the initial quote, Exhibit 7, was given, and did so.^[42]There was then a quote invited which was not expressly on that basis, and a higher quote, Exhibit 11, was put in which was said to be calculated on the basis of an assumed average depth for the piers,^[43]evidently reflecting the former approach. There was then some conversation between the parties’ representatives, and changes to the specification, as a result of which a revised quote was put in where the amount quoted was much lower in respect of the trench piers.^[44]That reduction in the quote would be consistent with the plaintiff’s having been asked to quote on an basis of an average depth of two metres, and having done so.

[28]
In those circumstances, the changes to the plaintiff’s quote seem to me to support the evidence that there was a conversation in which it was told to provide a quote on the basis of an assumed average depth of two metres, which led to the lower revised quote. That this occurred was asserted by the plaintiff at an early stage.^[45]In all the circumstances, I find that Mr Evans did tell Mr Kamali and MrSpeziali that, and that, as a result of his having done so, they did tender on that basis.^[46]

[29]
On 19 January 2007 the defendant emailed the plaintiff an updated request for quote, specification and drawings for the project: Exhibit 13. The request for quote was very similar to the one in Exhibit 9, except that the date on which it was required was 22 January, and it referred to revision “a” of the standard form contract schedules, and version 2 of the specification. The revised specification was dated 17 January. In paragraph 2.0, the lettered items said to be included in the scope of civil works had paragraph (j), supply and installation of water reticulation piping, deleted and paragraph (k) was modified so that only that part of the site shown sealed on the drawings was to be sealed;^[47]paragraph (m), installation and testing of earth grid, was deleted; paragraph (a) was modified with “client will remove all existing services”; paragraph (h) referred to a sewerage collection tank and pump and connection in place of a package treatment plant; paragraph (i) included excavation as well as formwork reinforcing and concrete; and the detailed information about concrete slabs surface coating previously contained in paragraph (l) had shrunk to one line which was included in paragraph (k). This suggests some sloppy preparation, consistent with the fact that paragraph (c) was not omitted even though the policy previously expressed in Exhibit 12, of not importing fill to the site and adjusting the levels as required, had not been altered.^[48]

[30]
There was one extra drawing for the workshop amenities building. Paragraph 4.0 made it clear that the subcontractor was not to provide drawings as such, but just to mark-up drawings to reflect “as built” conditions. The requirement in clause 4.7 to produce soil and water management erosion and sedimentation plan was deleted. A reference to rain water tanks and an unintelligible sentence about overflow were removed from clause 7.0. Clauses 8.9, safety showers and eyewash installations, and 8.10, fencing, were both deleted. The price schedule in clause 11.2 was quite different, with more information about earthworks which now incorporated the former Item 7, more detail about the workshop amenities building in Item 5 in place of the former Item 10, the change about the sewerage requirements in Item 6, more detail about the surface coating of the engine plinths, the fencing item being deleted, and excavation formwork reinforcement and concrete in Item 3 seeking the following details: “3.1 - 11 number engine bases; 3.2 - lube oil bund; 3.3 - auxiliary transformer; 3.4 - gas filter slab (if required)”.

[31]
The schedule of rates in clause 11.3.1 was modified by including a reference to lean mix concrete, and the rates for labour in clause 11.3.2 now sought rates separately for an hourly rate, Sunday or public holiday rate and travelling rate or standby rate for equipment. A work schedule was still required for a start date no earlier than 29 January and no later than 2 February 2007. With the emails were Parts A and B annexures to the Australian Standard Sub-contract Conditions referred to earlier, which had been filled in, and some other pages. On one it was stated that “the bitumen pavement will not be required until all major pant [sic] has been erected and hence is not included in penalty clauses within this contract. The expected date for sealing the bitumen pavement is around end of August 2007”. One of the details completed was the times for payment claims with reference to clause 42.1: “30 days from end of month of month of invoice [sic]. Invoices to be submitted by 25^thof each month”.

[32]
There were two drawings attached to the first email on 19 January, Exhibit 13. A further six were attached to an email later that day, Exhibit 14, and the extra drawing, for the workshop building, was forwarded in a separate email soon after, Exhibit 15.

The contract

[33]
On 23 January 2007 the plaintiff sent the defendant a revised tender: Exhibit 16. This document was similar to Exhibit 11, but different. The contract price was lower, and the second dot point was omitted from the covering letter. The price schedule was different from the earlier tender, but close to the version in Exhibit 13. Item 1 from Exhibit 11 was omitted, consistent with the omission of the second dot point in the earlier letter. The former Item 2 became Item 1, and its price actually went up a little. The former Item 3 became “earthworks including achieving base levels, crushed rock placement, shaping and compaction ready for chip seal” for a lump sum which was the total of the amounts previously listed separately in Items 3 and 8; the latter was for “supply and spreading of gravel” i.e. the placement of roadbase under the chip seal surface. Item 3 corresponded with the former Item 4 but was described as “excavation, place formwork, reinforcement and supply and finishing concrete” for a price which was about $80,000 less than the previous price for Item 4, and contained a break down as follows:

“3.1 11 number engine bases $269,500

3.2 Lube oil bund $17,689

3.3 Auxiliary transformer $14,860

3.4 Gas filter slab (if required) $5,638 each^[49]

3.5 Under slab foundation $167,548”

[34]
The difference between the figure quoted for “footing” in Exhibit 11 and the figure quoted for “under slab foundation” in Exhibit 16 was $74,302, most of the difference between the total for Item 3 and the former total for Item 4. Item 4 in Exhibit 16 corresponded to the former Item 5 but the price was reduced by $7,000, Item 5 corresponded to former Item 10 at the same price, Item 6 covered supply and installation of sewerage pipework, collection tank and connection to rising main, and corresponded to the former Item 7 (supply and installation of sewerage treatment plant), for the same price, Item 7 corresponded to the former Item 9 (chip sealing the site) for the same price, Item 8 covered surface coating of the engine plinths and corresponded to the former Item 11 for the same price. Item 6 in Exhibit 11, “trenching for earthing, electrical and telephone backfill and compaction” was deleted. As a result the total before GST was $1,075,882, about $160,000 lower than in Exhibit 11.

[35]
On 25 January 2007 Mr Kamali sent a further email (Exhibit 17) to Mr Evans attaching a program of work for review and approval, and adding that the annexures A and B, lists of services and facilities in separable portions, and a form of unconditional undertaking had been reviewed by the plaintiff, all of these being things included in the attachments to the email, Exhibit 13. The plaintiff advised that it was “making commitments to fulfil all requirements of the contract subject to the following modifications of the above contract conditions” and then listing five changes to the part A annexure of the Australian Standard Sub-contract Conditions. In addition the plaintiff required a telephone service to be provided, those parts of clause 52.3.2 of annexure part B to the standard conditions which referred to documents prepared by the subcontractor to be deleted as not applicable, and declined to sign the form of unconditional undertaking forwarded as part of Exhibit 13. The effect of this email was to qualify the offer of 22 January 2007 so that thereafter it was the offer as qualified which was open for acceptance.^[50]The same day Mr Evans replied (Exhibit 37) querying aspects of the price, and commenting on some of the matters included in the attachments to Exhibit 17. There was no evidence of a response from the plaintiff modifying Exhibit 17 or its offer otherwise. One point made was that “all variations … will be either covered by a quotation or will be priced under clause 40.5…”

[36]
On 29 January, the defendant sent the plaintiff an email enclosing a letter accepting that tender: Exhibit 19. That letter stated expressly that a formal contract in relation to the work to be done would be prepared in due course, but that the plaintiff was to treat the letter of acceptance as authority to commence work. That is what in fact occurred. In those circumstances I characterise this is an example of a case in the first category in Masters v Cameron,^[51]where the parties enter into a contract immediately, but with the intention that a more formal and fuller expression of the terms of their contract will be prepared and executed in due course. This produces an immediate binding contract, subject to its being superseded by the later formal contract.^[52]This was not just a request to start work in the hope that a contract would come into existence, but an instruction to proceed on the basis that the tender was accepted.^[53]

[37]
Most of the documents that I have been through apart from the first quote were included in the list, in paragraph (a) of Exhibit 19, of documents to be included, which also referred to the plaintiff’s quality information received on 25 January, and a tender clarification of the same date, neither of which are in evidence.^[54]The date of commencement was said to be 2 February 2007.^[55]The note recorded that the plaintiff had declined the defendant’s invitation to attend a site inspection “prior to award of this contract”. The only aspect which could be identified as some attempt to modify the plaintiff’s offer was a further proposed amendment to schedule part A to the standard form contract, substituting in relation to the provisions for payment “terms of payment 30 days from end of the month of progress claim invoice. Quantity of claim to be agreed with CEA Site Manage prior to submittal”. This appears to modify what had been included in the document in Exhibit 13 by deleting the requirement that the progress claim be submitted by the 25^thof each month, and inserting a requirement that the “quantity” be agreed with the defendant’s site manager.

[38]
It is not clear that this was a deviation from the offer given the terms of clause 42.1, as it could be construed as evidence supporting the progress claim reasonably required by the defendant’s representative, identified in part A as Mr Evans, but if it did technically amount to a counter-offer I consider that it was accepted by the plaintiff’s embarking on the work in response to this letter, which amounted to acceptance by conduct. Apart from that, it does not seem to me that anything in Exhibit 19 contradicted the content and the basis of the quotation of 22 January 2007, or the content of the plaintiff’s email of 25 January 2007, both of which were said to form part of the contract. To the extent that they were inconsistent with the specifications or drawings, I consider that they prevail as being more specific.^[56]

[39]
It was submitted for the defendant that the categories in Masters v Cameronshould not be treated as a rigid classification, in reliance on what was said in Ermogenaus v Greek Orthodox Community of SA Inc(2002) 209 CLR 95 at 105 and Pavlovic v Universal Music Australia Pty Ltd (2015) 90 NSWLR 605 at 617. My view is that the discussion in Ermogenauswas more about the question of intention to enter into legal relations than whether entry into legal relations was to be conditional upon a formal contract being executed between the parties. Masters v Cameron was cited at [25], and nothing was said to suggest that its operation was in any way to be modified by that decision.

[40]
In the present case, there can be no doubt that the intention of the parties was that there be a contract between them, and there is no reason to characterise the revised tender provided by the plaintiff as other than an offer. In those circumstances, the issues are whether the “letter of acceptance” amounted to an acceptance of that offer, and whether any acceptance was subject to the condition of the parties entering into a formal contract, so that there was to be no contract until the formal contract had been executed. In my opinion, the correct objective characterisation of the letter of acceptance is that it was an acceptance of the offer which created an immediate contract, though it contemplated that there would be a formal contract executed, something which, on my analysis, never came about even though both parties in fact signed Exhibit 52. My analysis therefore is that this case falls squarely within the first category in Masters v Cameron, and it is unnecessary to consider to what extent those categories are to be applied strictly.

[41]
It was submitted for the defendant that the documents did not support the inclusion in the contract of what was described as the trench depth instruction, relying on the fact that the drawings referred to the trench depth varying, and contained no statement as to the average depth. That was true, but the drawings also contained statements as to the levels (RL figures) of the finished works on the site, and the specifications included the supply of fill in order to enable these levels to be achieved, but the plaintiff was instructed to tender on the basis that fill would not be imported into the site and the levels would be adjusted on the basis of the re-use of material that was already there. This instruction as to the basis on which the plaintiff was to quote was not included in the documents listed in the letter of acceptance as documents to be included in the formal contract, but that it was given was uncontroversial because it was confirmed in writing, and there can be no doubt that the plaintiff’s offer to do the work was on that basis, because the offer said so expressly. It follows that acceptance of that offer produced a contract which was in this respect inconsistent with things stated in the drawings and something stated in the specification.

[42]
On the findings I have made, the position was the same in relation to the “trench depth instruction”, the only difference being the legally irrelevant but practically important difference that the absence of any confirmatory document has given the defendant the opportunity to dispute that it was ever given. But the only offer which was open for the defendant to accept was the offer the plaintiff in fact made, and if that offer was one to do the work on (relevantly) the basis of the trench depth instruction, and that offer was accepted, that is the contract the parties entered into. The submissions to the contrary on behalf of the defendant are rejected.

The formal contract

[43]
The defendant subsequently prepared a document which was to be the formal contract between the parties, and sent it to the plaintiff for execution. The contract initially arrived at the plaintiff’s Dalby office, and was passed on to the managing director who by then was in Mount Isa.^[57]Mr Speziali made some changes to a number of provisions in the contract, signed it, and gave it back to the defendant: p 2-90.

[44]
The defendant’s reaction was to accept some of the changes which were made by the plaintiff, but to reject most of them, as was made clear by a letter: Exhibit 54. This was sent by the defendant to the plaintiff together with a signed copy of the contract, as it states. On the view that I take of the evidence^[58]nothing happened after Exhibit 54 in relation to a formal contract between the parties. In these circumstances, the parties never agreed on the terms of the formal contract. The version prepared by the defendant was altered by the plaintiff, signed and returned, but that was technically a counter-offer, and the defendant, although signing the document, returned it as a further counter-offer, which was never accepted.^[59]At that point the parties seem to have lost interest in the formal contract. So the contract initially formed by the acceptance of the tender was never superseded by a formal contract. This is covered by Clause 6.1 of Exhibit 53.

[45]
I considered the significance of changes to a contract in writing after it had been signed in MJ Arthurs Pty Ltd v Isenbert [2017] QDC 85, where among other things I said at [91]:

“If after one party signs a contract in writing and sends it to the other party, the other party makes an alteration to the contract in writing and signs it, that is not an acceptance of the offer constituted by signing and sending the contract in writing; it is a counter-offer, to enter into a contract in those different terms. “In order to create a contract an acceptance must be unqualified and it must accord with the terms of the offer: cf Davies v Smith (1938) 12 ALJ 260. That and other decisions show that the requirement of correspondence between offer and acceptance is one that is insisted upon with considerable strictness.”^[60] There are many cases where that principle has been applied, sometimes without being expressly stated.^[61]”

Terms of the Contract

[46]
The question arises as to what the terms of the contract between the parties comprise. What occurred was that the plaintiff’s offer was accepted by the defendant. There was, with one exception, nothing in Exhibit 19 which would lead to that document being construed as a counter-offer. There are statements about what it was anticipated the formal contract between the parties would then include, but I do not consider that that amounted to an attempt by the defendant to impose conditions on its acceptance of the plaintiff’s offer, so as to amount to a counter-offer.

[47]
The offer which was accepted was that made on 22 January 2007 in Exhibit 16, which was a tender submission for the X41 power station which the plaintiff had been originally invited to tender for by the emails sent on 21 December 2006, Exhibits 9 and 10, and for which updated specification and drawings were sent on 19 January 2007, Exhibit 13. What was being offered however was set out in the price schedule attached to the offer, which had become significantly different from the price schedule in clause 11.2 of the specification in Exhibit 9, largely because of changes in the blank schedule in the revised specification in Exhibit 13. This involved deleting some work initially covered by the specification, and provided much more specificity about what was covered by the offer in terms of “excavation, placing formwork, reinforcement, and supply and finishing of concrete” than was nominated in Item 3 of the former version. It clearly did not include the matters identified in paragraphs (c) and (n) of clause 2.0, scope of supply, of the specification, and it did not include the preparation of detailed design drawings which had been included (as an open book item) in the first tender, Exhibit 11. It was, it seems to me, clear that it was an offer to do the work identified in the price schedule for the total at Item 9, because the specific prices for each of the other eight items add to the total amount.

[48]
It was also responsive to the telephone conversation on 15 January 2006, confirmed by a letter, Exhibit 12, that the levels in the design were to be amended to avoid the importation of fill, rather than the contract extended to the supply and placing of fill if required in order to achieve the design levels, as was made express in the letter. On the finding I have made, that after the first tender the plaintiff was asked to put in a revised tender based on an assumed depth for the trench piers of two metres, I consider it was also responsive to that request, even though that was not stated expressly in the letter, so that what was being offered relevantly was to build under slab foundations, that is, trench piers, having an average depth of two metres.^[62]This was because the plaintiff had been asked by the defendant to tender on that basis, and I accept that the second tender, Exhibit 16, was submitted on that basis. That was what the plaintiff was offering to build for the price stated, and that was the offer the defendant accepted. Subject to the modifications which resulted from what had passed between the parties after 21 December 2006, the tender was on the basis for request for tender in Exhibit 13, as was apparent from the terms of the price schedule in Exhibit 16. I am prepared to accept that it incorporated the balance of the revised specification, the plans included in Exhibits 13, 14 and 15, and the terms of the Australian Standard Sub-contract Conditions AS2545-1993, with part A and B as in Exhibit 13 as qualified by the email, Exhibit 17.

[49]
The plaintiff did work under the contract, starting on 9 February 2007.^[63]It is not clear exactly when the plaintiff’s work came to an end, but it was not contentious that the plaintiff in fact did the work, and that there were no complaints on the part of the defendant about the plaintiff’s work.^[64]A final payment claim was sent by the plaintiff to the defendant on 21 November 2008.^[65]Under clause 42.8 of the contract, the defendant was to respond to that claim within 28 days. A certificate in response to that payment claim was not issued by the defendant until 11 June 2013: Exhibit 59.

[50]
Clause 42.1 of the general conditions of the standard form contract provided, among other things, “within 35 days after receipt by the main contractor’s representative of a claim for payment or within 14 days of issue by the main contractor’s representative of the main contractor’s representative’s payment certificate, whichever is the earlier, the main contractor shall pay to the sub-contractor…. an amount not less than the amount shown in the certificate as due to the sub-contractor… or if no payment certificate has been issued, the main contractor shall pay the amount of the sub-contractor’s claim.” The plaintiff submitted that 35 days after the payment claim was made, the main contractor’s certificate not having issued, it was entitled to be paid the full amount of the claim.^[66]

[51]
In response to this submission, the defendant pointed out that a claim for payment on this basis had not been pleaded, and that the amount claimed was greater than the amount pleaded as money due and owing under the sub-contract, and significantly greater than the total which was otherwise claimed in submissions on behalf of the plaintiff.^[67]There is some force in these propositions, but a more fundamental reason why a claim on this basis cannot be advanced now is that, although referred to as a final payment claim, the terms of clause 42 deal with payment claims generally, and such claims and payments pursuant to them have always been regarded as payments on account, subject to the final entitlement of the parties being resolved, if necessary, in the event of a disagreement, by a court.^[68]It is the true entitlement of the plaintiff under the contract, in respect of the amounts claimed in the pleadings, which has been in issue in this proceeding, and has been litigated, and that is what I am to determine, not whether the plaintiff might have been entitled to some greater amount on account if it had acted promptly in 2008. The matters in issue in this proceeding cannot be resolved on that basis.

Credibility

[52]
I was not impressed by Mr Evans as a witness. At times his recollection of events seemed to be very sketchy.^[69]For example at p 4-69 he had no clear recollection of what happened in relation to the formal contract, and he was very vague about whether there was any communication between him and anyone from the plaintiff between the first and second tenders. When dealing with the signing of the contract he initially said that after Exhibit 54 was sent to the plaintiff he did not receive any comments in reply “other than getting the contract back signed after that process went through.”^[70]He said on the same page that Exhibit 54 was sent before the contract was signed, and when his attention was drawn to the first line of Exhibit 54, he said it went with the contract to be signed: p 4-70. Plainly that was not true; the letter referred to “a signed copy of the contract”. He did eventually concede that that terms meant that the letter must have been sent with the contract after it had been signed: p 4-70. This was during evidence-in-chief and it was in response to some questions from me, because what he was telling me was obviously inconsistent with the terms of Exhibit 54. Indeed, I was rather abrupt in my questioning of him. Despite that, when counsel for the plaintiff raised this issue during cross-examination, MrEvans again asserted that the contract had been signed after Exhibit 54 had been sent.^[71]I was surprised by this response, after what had happened during evidence-in-chief.

[53]
Mr Evans was the person who put together the formal contract document, but in spite of the fact that there are a list of things which in Exhibit 19 he said would be included in it,^[72]not all those things were in fact included in Exhibit 52: significantly, the plaintiff’s quotation was missing, as Mr Evans conceded, just after he had claimed that all of the items in the list were included in the contract.^[73]In addition, Exhibit 52 included his letter of 29 January (Exhibit 19) which was not on the list in Exhibit 19. Also omitted was the email dated 25 January (Exhibit 17) with the project schedules which qualified the tenders (p 5-28), although a different email of that date, which in my view had no place in the contract, was included. Exhibit 52 included a letter from the plaintiff of 29 January, sent after the acceptance letter, Exhibit 19. Overall preparation of the formal contract by MrEvans did not display any careful attention to cover the relevant documents. This was consistent with a number of examples I have noted of sloppy documentation, apparently from him. It does not encourage reliance on contemporaneous documents he prepared, let alone any independent recollection about a decade later.

[54]
There are some other problems with his evidence. At times he tended to give answers which were quite unresponsive, apparently just on the basis that it was something he wanted to talk about.^[74]When Mr Evans was shown Exhibit 5, the email dated 16December 2006 that he sent to the plaintiff, he was confused about the date of the request for a quotation made in it, both in evidence-in-chief (p 4–51, 52) and in cross-examination: p 4–92. There is in fact nothing confusing about the date, the email simply nominating 15 January 2007 as the date by which the quotation was to be supplied, as he ultimately acknowledged: p 4–93. The document was quite clear, and that it would confuse Mr Evans, who had written the letter, is surprising.

[55]
There were some other features of Mr Evans’ evidence which struck me as unsatisfactory, and suggested that he had limited recollection of this project. At one point he claimed there were no changes to the scope of works in the lead up to the contract (p 5-20) but he later conceded that there had been changes.^[75]At one point Mr Evans claimed that laying the bitumen seal was added very late to the work required of the plaintiff (p 5-31) but the earliest specification sent to the plaintiff included reference to bitumen and so far as I can see that was always part of the work to be covered by the plaintiff’s contract, though it was always intended that a specialist sub-contractor would perform the work. At one point, when he was asked a question about Exhibit 16, his response was “no comment”: p 5-40.^[76]

[56]
He claimed that when the defendant made a claim under its contract because of the failure to remove the services it used the information from the plaintiff’s claim in its claim, and in effect passed on the plaintiff’s claim: p 5-70. In fact the defendant claimed in Exhibit 80 an amount almost double the amount of the then current version of the plaintiff’s claim, in Exhibit 40.^[77]He did not say whether the defendant’s claim was paid in full, but the plaintiff was not paid until the defendant had received its money: P 5-72, said to be the normal practice, but not what was provided in the Subcontract Conditions Exhibit 53.

[57]
With regard to Mr Speziali, I had some concerns about his evidence as well. I have already referred to one point where I consider his evidence was mistaken, though he did ultimately correct himself on the morning of the second day he gave evidence: p 3-3. At one point he suggested that in Exhibit 11, the first quote, the total figure given for the quote did not include the amount quoted for the trench piers: p 2-78.^[78]That seems to me not to be correct, and he corrected this at p 3-4.

[58]
When he was being cross-examined about the sequence of events in relation to the different tenders put in, he referred to “the note of Clarke Energy that says allow two metres” (p 3-48) as something that happened after the first tender, whereas on his other evidence there was no written instruction to allow two metres at that stage, but an oral instruction. It may be that at this point he simply became confused. He did give me the impression that he was personally strongly committed to his claim, and he was at times somewhat voluble, but this may have been due to his being nervous in the witness box.

[59]
There were a couple of aspects of his cross-examination that were somewhat unsatisfactory. He said that the site ended up about 200mm lower than originally designed after the initial earthworks were done (p 3-18), but when cross-examined (at p 4-15) it was suggested that he had said the site dropped by 100mm, which he disagreed with, but his evidence then became more vague about whether the reduction in height was around 200mm: p 4-15. More concerning, my analysis of the lean mix concrete claim shows that the agreed figure for the volume of concrete used is inconsistent with his evidence about the extent of trench collapsing.

[60]
He was also cross-examined at p 4-10 about why he did not appreciate that the service support tree slabs were part of the project. His answers here were all quite sensible, indeed more sensible than the questions, given that any ambiguity in this regard arose because of the defective paperwork prepared by the defendant.

[61]
There was one matter which emerged from cross-examination where I found his answer somewhat surprisingly frank. He said that in 1969 he had been doing work on a building constructed adjacent to this site, and when he was there for that purpose he saw rock and muck from a particular shaft being put on the land which became the site for this project: p 4-14. That struck me as a relatively frank answer, though it does seem to me that he could hardly have been expected to retain memory of details about just how large the rocks were many years later when he came to quote for this project. On the whole, my assessment of Mr Speziali was that he was essentially an honest witness, though some parts of his evidence had to be treated with a degree of caution.

[62]
The credit of Mr Kamali was not challenged in cross-examination, and with one exception there is no particular reason why I should not accept his evidence. That exception is a letter he sent, Exhibit 31, concerning the engine slab concrete thickening claim, discussed below, which (as pointed out there) is a curious document, not consistent with the logic of that claim. I am also conscious of the fact that he was not on site and cannot give original evidence of what occurred there, and that in some respects his evidence was contradicted by others. In general however I accept him as an honest and reliable witness.

[63]
Mr Stevens was at times frank but at other times simply repeating the defendant’s line. He accepted that he had little independent recollection of this job, and as discussed below some of his contemporaneous documents were inconsistent, and he accepted that there were errors in them. On the whole, I am very wary of his reliability. I do not need to say anything here about any other witness.

Lean mix concrete claim

[64]
The plaintiff claims that it is entitled to extra payment in respect of additional lean mix concrete used in the construction of the trench piers. The plaintiff’s tender based the amount of lean mix concrete required for the trench piers on their design width and length, and the assumed depth of two metres, at 178.2m³.^[79]In fact the volume of lean mix concrete poured on the site was 355m³, a figure derived by the plaintiff from records it kept of deliveries of lean mix concrete to the site, which were said to have been confirmed by Mr Stevens, the site manager for the defendant.^[80]There was no specific submissions for the defendant about this figure; I treat it as uncontentious.

[65]
The additional volume of concrete was due, it was submitted, to three factors: the trench piers in fact were dug to a greater depth than an average of 2m, and the sides of the trench piers were not precisely in accordance with the dimensions in the diagram, to some extent because of the presence of underground or aboveground services which had to be removed by the plaintiff and which ought to have been removed by the owner, and to some extent because of the nature of the fill which had previously been placed there, which was full of rocks, including large rocks. There was evidence from Mr Speziali that all of these problems were encountered on the site, and that there was some collapsing of the sides of all of the 66 trenches that were dug, apart from any issues about greater depth.^[81]There was some evidence from Mr Stevens about this as well, though it appeared that ultimately his position was that there was some collapsing of the trench sides or ends associated with the removal of underground services, but that otherwise the trenches were neatly dug, and he denied that there was any collapsing of the sides because of the rocky nature of the fill through which they were being dug.^[82]

[66]
I do not regard this evidence of Mr Stevens as reliable. There are three reasons for this. The first is that it is apparent from the photographs which were in evidence,^[83]photographs taken by MrStevens, that the sides of the trenches were not neat and vertical, even in those trenches where there was no sign of the removal of underground services. Second, there was evidence also in the photographs that the trenches were being dug through rocky material, with at times quite large rocks, the presence of which would obviously lead to some collapsing, or at least over break on the sides of the trenches. Third, because 355m³ of lean mix concrete was poured in the trench piers, there must have been collapsing or over break, since this volume could not be explained just on the basis of the additional depth.

[67]
The defendant paid a claim for extra work caused by the presence of services not removed which included 53 m³ of additional lean mix concrete: Exhibit 41.^[84]There was apparently no record kept of exactly how deep all trench piers ultimately came to be excavated, so it is not possible to calculate with precision the additional concrete required specifically by the fact that the trench piers proved to be deeper than an average of 2m, but if they had been an average of 3.3m deep as asserted by the plaintiff and there had been no over break there would have been 294m³ of concrete required. Adding the 53m³ of additional concrete related to the presence of services accounts for 347m³ of concrete, and leaves only 8m³ unaccounted for. In those circumstances, Mr Stevens’ assertion that there was no collapsing or over break other than associated with the presence of unremoved services strikes me as implausible, as does the evidence of Mr Speziali, that over break and collapsing were actually very common, indeed normal in these trenches. There was some other over break, but not a great deal.

[68]
The matter is complicated by the fact that the conceptual basis for payment for additional concrete differs depending on whether it was attributable to the extra depth of the trenches, the presence of services which ought to have been removed, or collapsing due to the rocky nature of the fill. In relation to the extra depth, the position is simply that, on my analysis of the contract between the parties, the plaintiff had contracted to build trench piers only to an average depth of 2m, so that if and to the extent that it was in fact required to build trench piers deeper than that, this was something not covered by the contract. In those circumstances it is either something the defendant has to pay for as a variation of the contract, or something to be paid for as additional work done not covered by the contract.

[69]
The question of the underground services is different in that it was an express term of the contract that the underground services would be removed by Xstrata, and that did not occur. Hence the defendant was liable for the additional costs associated with the failure to remove the underground services, either on the basis of a variation under the contract or on the basis of damages for breach of contract. In respect of the difficulties caused by the nature of the fill, this was an aspect of what is usually described as a latent condition of the site. For this the position is more complicated. Prima facie, difficulties caused by the latent condition of the site are at the risk of the contractor, in the present context, the plaintiff. The plaintiff was bound to do the contract works for the contract price even if unforeseen conditions made it more difficult and expensive,^[85]and for the plaintiff to be able to transfer that additional cost on to the defendant it is necessary for the plaintiff to rely on a contractual provision which has that effect.

[70]
To some extent the plaintiff’s complaint was that the defendant did not make available the geotechnical report Exhibit 1, which would have assisted the plaintiff to make a more realistic assessment of the fill on this land. I accept that the defendant was asked for a copy of the report, and the defendant failed to provide a copy, but there is authority that there is no obligation on a party in the position of the defendant to disclose material of this nature.^[86]This is not a case where the issue is whether the plaintiff was entitled to rely on information which was not provided.^[87]

[71]
The issue in relation to the trenches collapsing simply because of the nature of the material being excavated depends on whether the plaintiff can bring itself within the terms of Clause 12 of the Australian Standard Subcontract Conditions, which are in Exhibit 53. This clause defines latent conditions, relevantly, as:

“Physical conditions on the site… which differ materially from the physical conditions which should reasonably have been anticipated by the subcontractor at the time of the subcontractor’s tender if the subcontractor had –

(i)
examined all information made available in writing by the main contractor to the subcontractor for the purpose of tendering; and

(ii)
examined all information relevant to the risks, contingencies and other circumstances having an effect on the tender and obtainable by the making of reasonable enquiries; and

(iii)
inspected the site and its surroundings….”

[72]
The only information made available as to what lay under the surface of the ground by the defendant to the plaintiff was the information on the diagrams forming part of the request for tender, that the test pits dug on the site had revealed some distance between the surface of the ground and the natural surface, and some further distance to dense colluvium soil. That indicated that the site had been filled, to varying depths, and that below the natural ground surface there was a level of material which did not qualify as dense colluvium soil. Other information on the site was that contained in drawing CO241-CF-006, which stated:

“Important note:

Soil testing on this site revealed uncontrolled filling to depths between 1.0m and 3.6m. Generator footings have footing piers specified to transfer load to natural ground, however remaining footings being lightly loaded are founded in filling and as such some settlement may occur. This may require occasional re-levelling of supporting structures. If this is not acceptable continuous trenching to natural ground, the use of footing piers or re-compacting filling will be required.”

[73]
The significance of the reference to uncontrolled filling was, as Mr Speziali knew, that the material deposited on the land had not been systematically compacted as it was deposited there, so that it was relatively loose material: p 3-50. This would indicate, in my view, some propensity for collapse of trenching through such material, but it is not obvious to me, and no expert evidence was called, that this reference in itself ought to have conveyed to a reasonably competent and experienced contractor that the presence of large rocks in the fill should reasonably be anticipated. It was not suggested that there was any other relevant information in fact made available to the defendant, nor was any evidence led of any relevant information which was in fact attainable by the making of reasonable enquiries. If this fill had in fact been deposited on the site in around 1969, it may be that even making enquiries of the mining company would not have been a fruitful source of relevant information. There was certainly no evidence that it would have. The defendant’s submission that the report Exhibit 1 was relevant information available to the plaintiff is rejected, as inconsistent with findings I have made.

[74]
It was submitted for the defendant that there was no reason why the defendant’s employees would have denied the existence of a geotechnical report, or refused to hand it over. But it seems to me that there are two fairly obvious explanations for this failure. The first is simply that Mr Evans did not consider that the plaintiff needed to see a copy of the report, having the view that everything the plaintiff needed to know was on the drawings (p 5-10), and in that situation he could not be bothered arranging for a copy to be made and provided to the plaintiff.^[88]The second reason is that, had this information been provided to the plaintiff, it is quite possible that the plaintiff would have increased its price for doing the work, and it is clear that the defendant was keen to get as cheap a price as possible to have this work done. Accordingly, I do not see anything implausible in the unwillingness of the defendant to provide a copy of the report, and find the plaintiff’s evidence about this matter quite plausible.

[75]
As for inspecting the site, it is true that no one from the plaintiff actually inspected the site and its surroundings prior to the tender being lodged, but there was no evidence that the presence of large rocks in the fill would have been apparent on any inspection of the site and its surroundings. The position therefore in relation to the definition of latent conditions is that the fact that the fill on the site had not been systematically compacted and would be therefore relatively loose ought to have been reasonably anticipated, and was therefore not a latent condition, but the presence of large rocks within the fill was not, in my opinion, something which should reasonably been anticipated, and therefore was a latent condition.

[76]
It was submitted for the defendant that the plaintiff did not comply with Clause 12.2, which required written notice of the latent condition to be given to the main contractor’s representative, and further information to be provided to that representative. Notice in writing under Clause 12.2 was given by a facsimile sent by Mr Kamali to Mr Stevens on 6 March 2007: Exhibit 30. The pouring of the extra concrete required by the trench piers occurred during their construction in the period 21 to 28 February 2007 (Exhibit 60) so that this was well within the 21 day period referred to in Clause 12.4. Mr Stevens said that he had received previous verbal complaints from Mr Speziali, but did not refer to any previous written communications: p 6-8. Technically the main contractor’s representative was Mr Evans rather than Mr Stevens, but Mr Stevens said he would have forwarded the emails to Mr Evans (p 6-8) so that Exhibit 30 was written notice which was in this way given to Mr Evans, and Clause 12.2 was satisfied.

[77]
Mr Stevens, who was the person working for the defendant on site during the relevant period, gave evidence largely in relation to the extent to which there was collapsing in the trenches being dug for the trench piers, and in relation to what work was being done during the period when the road base was being laid by the plaintiff. As for the former, his comment about the way the ground behaved was that there was trouble with underground services which caused collapsing when they were pulled out, then he continued “in general, the trenches were – they were reasonably uniform in general, particularly for the type of soil it was. It was like those rocks and…”: p 6-7. When he was asked to repeat the qualification, he said “particularly for the type of fill that was there. They were quite good.” This is, to some extent, qualified comment about the absence of collapsing; rather, that the trenches were quite good bearing in mind the rocky soil they were being dug through, which suggests that there were some problems with the trenches. However under cross-examination Mr Stevens took the view that he did not recall most of the trenches suffering from over break: p 6-53.

[78]
There were some contemporaneous notes made by Mr Speziali in his work diary, extracts from which became Exhibit 60. These show trench depths which are consistently greater than 3m, but in terms of width he records various widths described as “average widths”, and presumably estimates, for the trench piers (12 on 21 February and 8 on 22 February) ranging between 600mm and 900mm; trench piers were supposed to be 450mm wide. On 21 February, the diary recorded that two steel water pipes affected the trenches for four piers which blew out, but it seems there were trenches for 12 piers dug that day. There were seven or eight trenches dug the following day, and reference to a pipe and a cable having been found, but the number of trenches affected was not recorded. On 23 February the total number of trenches dug was not recorded, but there was a concrete slab found which affected two of them, and a concrete pipe which affected three. On 24 February, there were seven pier trenches dug, five of which were affected by underground cables.

[79]
It does appear from these notes that underground services were a significant problem, but it also appears that the trenches generally ended up wider than the design. To some extent, this would have been simply due to the fact that they were being dug through uncontrolled fill, but to some extent it would have been because of the rocky nature of the material. Exhibit 60 does not appear to have been contrived in any way, it was not shown that the notes so far as they went were not generally accurate, and I accept that they were. There may be some issue about how the depth of the trenches was measured, and whether the figures are the depth of the concrete or the depth of the trench, bearing in mind that the top of the piers was some distance below the top of the slab, as discussed earlier. On the whole I regard Mr Speziali’s contemporaneous diary notes as providing support for the existence of over-break in the trenches, something which is also supported by the photographs taken by Mr Stevens,^[89]and perhaps to some extent by Mr Steven’s concession that the trenches were being dug through rocky material.

[80]
In these circumstances, the effect of the latent condition I have found was that it caused the plaintiff to carry out additional work, in the form of additional excavation work and the supply and placement of additional concrete. In these circumstances, under Clause 12.3, variation shall be made under Clause 40.5. That clause provides for the valuation of the variation, as an amount derived, if the subcontract prescribes specific rates or prices to be applied in determining the value, by the use of those rates or prices: Clause 40.5(a). In the present case, the plaintiff’s quote included rates and prices to be applied in determining value, and accordingly those rates are to be used in respect of the additional concrete poured because of the latent condition.^[90]

[81]
Then comes a matter of determining what allowance should be made for this. There was no dispute that the total amount of lean mix concrete supplied and poured in the trench piers was 355m³. Had the trench piers had an average depth of 2m and no over break, the amount of concrete required would have been 178.2m³.^[91]Hence the overall additional amount of lean mix concrete required and used was 176.8m³. Part of this has already been paid for, in respect of the additional concrete allowed for trench collapses due to the presence of underground services, an amount of 53m³ as mentioned earlier. The balance is 123.8m³. The increase in the average depth of the trenches from 2m to 3.3m would explain 115.83m³ of concrete, leaving about 8m³ unaccounted for. This is not, on the whole, a very large allowance for over break: if each face of every trench was 50 mm deeper than it would have been had it been dug precisely to the designed dimensions, the amount of additional concrete required would have been over 22m³, so on this basis the plaintiff’s claim does assume that the trenches not affected by services were reasonably good. Some of this would have been attributable to the uncontrolled fill, but some of it would have been due to the particularly rocky nature of that fill. In the absence of better guidance from the evidence, I will apportion the amounts equally. Hence, the amounts properly allowed are 115.83m³ for the extra depth of the excavation, and 4m³ for the rocky fill, a total of 119.83m³. The variation rate in Schedule 11.3 in Exhibit 19 for lean mix concrete was $875 per m³, so the total for this claim is $104,851.25.

Alternative claims

[82]
The plaintiff claimed in the alternative that the defendant was liable on the basis that there had been a breach by Mr Evans of clause 23 of the general conditions of contract, which obliged the defendant to ensure that there was a main contractor representative, who in this case was Mr Evans, and that the representative acted honestly and fairly and arrived at a reasonable measure or value of work quantities or time. It was submitted that the defendant was liable on the basis that Mr Evans had acted contrary to these obligations in rejecting the claim for a variation. Given that in my view the plaintiff is, with one exception, entitled to recover the amounts claimed by way of variation, there is no need for me to consider this alternative in respect of these claims. In relation to the matter on which the plaintiff has failed, I am not persuaded that there was any failure on the part of Mr Evans in rejecting that part of the plaintiff’s claim.

[83]
The plaintiff also relied on a claim for damages under the Trade Practices Act, which however was advanced only if I found that the instruction to tender on the basis of an average depth of trench piers of 2 metres was not given, or I found that the instruction was given, but that it did not form part of the contract. I have found that it did, in the sense that it amounted to a direction to tender on a particular basis which the plaintiff acted on, and the tender on that basis was accepted by the defendant, with the result that the contract between the parties covered the construction of trench piers only to an average depth of 2 metres. It is not strictly necessary for me to deal with this matter, but I will say a few things about it on a precautionary basis.

[84]
The representation was pleaded as a representation as to a future matter, characterising it as a representation as to what the outcome would be found to be on excavation. It is therefore a question of whether the defendant had a reasonable basis for making the representation.^[92]As to this, the only material which could be relied on as constituting a reasonable basis for making the representation was the content of the geotechnical report, Exhibit 1. I have already explained why, in my opinion, the view that the report indicates an average depth of the trench piers in the order of 2 metres is a very superficial view, and I do not need to repeat what I said. In my opinion it did not amount to a reasonable basis for making such a representation, and the defendant did not discharge the onus of showing that the representation was not misleading or deceptive. I accept that the tender was reduced significantly because the allowance for the cost of constructing the trench piers, which had been calculated on the basis of an average depth of 3.3 metres, was recalculated on the basis of an average depth of 2 metres. That shows reliance on the representation. The relevant damages are the extent to which the tender was reduced specifically because of reliance on the representation, rather than the whole of the reduction in the price between the first and second tender, as there were other changes made.

-Proof of loss

[85]
It was submitted for the defendant that a claim under the Trade Practices Actcould not succeed, on the basis that there was no evidence of any loss as a result of the misleading and deceptive conduct relied on. The proposition was put that, if the representation as to the average trench pier depth had not been made, with the result that a tender at a higher figure had been put in by the plaintiff, there was no basis to assume that that tender would have been accepted by the defendant. I am not persuaded by this argument. The defendant had extended invitations to tender only to a small number of contractors, one of whom did not provide a tender: p 4–48. It appears the defendant was ultimately in a position to choose between two competing tenderers, and the plaintiff’s price was $159,118 less than the other: Exhibit 71.^[93]Hence if the plaintiff’s tender had not been reduced as a result of this representation, the other tender would still have been higher, so would probably not have been accepted.^[94]If it comes to that, for all I know the defendant made the same representation to the other competing tenderers.

[86]
The defendant’s argument depends on whether it would otherwise have let the contract to one of the other tenderers. In circumstances where the defendant had entered into a contract to build the power station,^[95]it was in a position where it had to accept one of the tenders for the civil works, so the only issue is whether there was another tenderer whose tender would have been accepted had the plaintiff’s tender not been decreased as a result of reliance on the misrepresentation. That is something only the defendant can prove, and did not. There is no substance to this point.

[87]
In those circumstances in my opinion the appropriate approach is that, in the absence of evidence from the defendant that the plaintiff would not have obtained the contract at all if a higher tender had been put in, I am prepared to assume that, if there had been no such misrepresentation and a higher tender had been put in by the plaintiff, it would still have obtained the contract but at a higher price. The plaintiff’s loss is the amount by which its tender was reduced in reliance on the misrepresentation.

[88]
It was also submitted that the plaintiff could not prove that it had suffered a loss where there was no evidence as to whether it made a profit or a loss from the contract as a whole. But that is not the correct measure of damage; that is generally assessed by reference to the difference between the position the plaintiff is in having relied on the misleading and deceptive conduct and the position the plaintiff would have been in had there been no such conduct relied on. In my opinion that difference represents the amount by which the plaintiff’s tender was reduced as a result of the misleading and deceptive conduct, regardless of whether the contract as a whole was profitable or produced a loss to the plaintiff.

Engine slab concrete thickening claim

[89]
This claim is based on the proposition that after the earthworks were finished the surface area of the ground where the engine slabs were to be constructed was lower than the original design provided, because of the defendant’s approach that no imported fill was to be used and the existing material on the site was to be used to shape the site, even if this meant levels lower than the design level. The defendant’s instruction was to tender on the basis that the design levels would be adjusted to accommodate the actual level of the site. That was the basis on which the plaintiff was asked to tender and did tender, and it was that tender which was accepted, so this was a term of the contract between the parties.

[90]
There was an argument before me as to whether the plaintiff had shown that after the earthworks the level of this part of the site had been reduced. The only direct evidence of this was that of Mr Speziali, which I have already said something about. The evidence of Mr Kamali was obviously hearsay, since he did not go to the site and can only have been acting on what he had been told by Mr Speziali. For whatever reason, his understanding that the reduction was 100 millimetres was reproduced in the variation claim lodged by the plaintiff, and ultimately was the figure pleaded.

[91]
There was no direct evidence to contradict this evidence.^[96]Mr Stevens gave evidence that there was a problem about levels because the amount of the fill which could be won from the site was insufficient to provide all the filling required to achieve the design level, though he could not recall how the difficulty was overcome: p 6-9. That however provides support for the proposition that the design levels could not be achieved without importing fill. Mr Evans seemed quite definite that fill was not to be imported to the site, for what that is worth, but if fill had been imported there is no reason to think that the plaintiff would not have made a variation claim for it, so the absence of such a claim provides support for the proposition that fill was not imported. In those circumstances, the shortage of on-site fill can only have resulted in a change to the design levels.

[92]
The defendant submitted that certain entries in the site meeting minutes Exhibit 86 and an email Exhibit 103 supported the proposition that ground levels had only been altered in part of the site, being a part away from where the engine slabs were constructed. It is true that those exhibits support the view that there was some lowering of the level in the south-east corner of the site, but they do not provide any direct evidence that there was no lowering anywhere else on the site. The defendant also submitted that there was no documentary evidence to show levels of the ground after the earthworks were completed to demonstrate that the site was in fact lowered. There was evidence that the plaintiff did employ surveyors, though I expect this was for the purpose of setting out work rather than checking levels.^[97]The defendant also had surveyors, indeed evidence was called from the surveyor who checked the “as constructed” levels of the engine slabs in August 2007, and confirmed that they were consistent with the design: Exhibit 82.

[93]
That survey however did not contain any information about the levels of the surface of the ground at any relevant point,^[98]and so did not throw any light on the question of whether, when the earthworks were completed, the level of the surface was lower than contemplated in the original design. I would have thought that if anyone would have been concerned about obtaining survey evidence of the final level of the road base, or indeed of the ground level before the road base was laid, it would have been the defendant. I am not prepared to draw an inference against the plaintiff because of the absence of evidence of this nature.

[94]
The defendant also submitted that there was no instruction from the defendant to the plaintiff to lower the site, but in circumstances where the material available was inadequate and something had to be done there must have been an instruction from the defendant to do whatever was done. In circumstances where there was essentially a choice between lowering the level and importing fill, and there was no fill imported, there must have been an instruction from the defendant to lower the level, which would have been consistent with the design philosophy expressed in Exhibit 12.

[95]
It was further submitted that the photographic evidence was inconsistent with the notion that the site had been lowered. In my view it is not possible to tell whether or not the site was lowered simply from looking at the photographs. Nothing useful can be derived from the relative height of the top of the enclosure slabs and the adjacent ground surface, with or without road base, because no dimension for this is shown on the drawings. Drawing CO241-CF-002 shows a difference which looks to be about 50 millimetres, but it is drawn as being the same on each side of section A, notwithstanding that one side is 100 millimetres higher than the other side.^[99]It appears from drawing CO241-CEW-002 that the road base under the chip seal pavement was to be 150 millimetres thick, which would suggest that the entire 200 millimetre thick slab for the enclosure slabs should have been exposed before the road base was laid.^[100]

[96]
It is difficult to tell just by looking at the photographs whether the amount of vertical concrete slab left exposed before the road base was laid was 200 millimetres or 300 millimetres (or more), but for what it is worth, some of the photographs look to me more like the latter.^[101]One photograph appears to show a piece of 300 millimetre wide formwork on one side of an enclosure slab which is sitting above the ground surface for the slab to be cast.^[102]I do not accept the argument that the photographs show that the distance between the top of the enclosure slabs and ground surface before the road base was laid was consistent with the original design so as to demonstrate that the ground level of the site had not been lowered. Overall therefore I do not consider that the photographs are inconsistent with the plaintiff’s case in this respect.

[97]
It was submitted by the defendant that the fact that the level of the ground around the generator slabs had not been lowered was demonstrated by a version of diagram CO241-CEW-001 which was dated 31 October 2007 and annotated “as built”.^[103]There are two problems with this evidence. The first is that there was no evidence called to show that the figures for “finished level of compacted crushed rock base” marked on these exhibits had in fact been updated to “as built” levels on the basis of some survey. The mere fact that the defendant has among its business records a document marked “as built” with certain levels on it does not prove that those levels were in fact the “as built” levels. Nor can the defendant prove this by putting in evidence a document disclosed by the plaintiff which was simply a copy of this diagram sent to the plaintiff. That is not the effect of rule 227(2).^[104]

[98]
There is in my view a more fundamental difficulty with this diagram. A comparison between the levels shown for the compacted crushed rock road base on these exhibits and the levels shown for the same thing on the version of CO241-CEW-001 dated 19 January 2007 shows (so far as I can see) all exactly the same levels, to the nearest 0.01 of a metre. The defendant spoke well of the plaintiff’s workmanship,^[105]but I cannot believe that it was that good. When the design levels were compared with surveyed levels of the tops of the generator slabs, Exhibit 82, properly proved through the evidence of the surveyor who took those levels, there were some differences, though the surveyed as built levels were essentially consistent with the design levels, so that it could be said that essentially the plaintiff had built to the design levels. But they were not all the same to the nearest 0.01 of a metre.

[99]
In my opinion, the obvious inference is that the finished levels of the compacted crushed rock road base on Exhibits 101 and 102 have not in fact been updated to “as built” levels determined by surveyors. Indeed, I doubt whether the correct interpretation of the annotation of 31 October 2007 on these exhibits is that the diagram generally contains “as built” information. I suspect that it shows, within a particular area marked near the foot of the diagram, the “pumps position updated, as built” which does actually differ from the earlier version of the drawing. Accordingly, it is unsurprising that the defendant did not lead survey evidence to prove that these were as built levels, because they were not. As evidence that the level of the site generally was not lowered, in my view, these exhibits are worthless.

[100]
The defendant also placed reliance on the fact that, in a fax sent to the defendant on 2 April 2007, Mr Kamali had sought to justify the need for increased concrete on the basis of the tendency for the rock fill through which the footings were excavated to collapse, leading to a change in the design which used more concrete. There are a number of curious features about this justification. It was not supported by evidence from Mr Speziali, and Mr Kamali was never at the site and therefore cannot give direct evidence as to the site conditions. The fax included a comparison between the footings as designed and the footings as constructed, and the former shows the excavations of the footings to be at right angles to the base of the slab, whereas section A on drawing CO241-CF-002 shows tapering at the corners, as shown by Kamali on his “actual site conditions” diagram.^[106]Further, he has drawn the footings excavated through the crushed rock layer, which may have been the original design,^[107]whereas the crushed rock layer, that is the road base, was not in fact laid prior to the digging of the footings. The footings were a maximum of 675 millimetres below the top of the slab, though half of them were only 600 millimetres below, but on any view of the matter the top of the slab was 200-300 millimetres above the ground surface into which the footings were being dug, and it is difficult to believe that there was much collapsing in footings only 300 or 400 millimetres deep.^[108]Further, the design provided for the top 300 millimetres footing face to be formed up, that is cast within formwork: drawing CO241-CF-002.

[101]
There was one further consideration. The surface area of an enclosure slab was 73.3 m².^[109]The amount of additional 32 MPA concrete used in the construction of the enclosure slabs was said to be 80.3 m³.^[110]There were 11 enclosure slabs, with a total surface area of 806.3 m². That volume of concrete gives a depth over that surface area of virtually exactly 100 millimetres.^[111]Hence the amount of additional concrete used was directly consistent with the slabs having been cast an extra 100 millimetres thick, what would have to be done in order to maintain the design surface level of the slab if the site were 100 millimetres lower.

[102]
It was submitted for the defendant that there had been an extra 10 m³ of 32 MPA concrete which was paid for in relation to the claim for a variation because of the underground services. It is correct that there was 10 m³ of 32 MPA concrete included in that claim, for which an amount was paid by the defendant, but it is clear from the earlier formulations by the plaintiff of its claims that the 10 m³ of this concrete claimed in respect of underground services was separate from and additional to the 80.3 m³ of this concrete claimed because of the increase in concrete slab thickness. As well, the calculation above shows that all the 80.3 m³was used to raise the slabs 100 mm. Accordingly, no deduction should be made on this basis.

[103]
In my opinion therefore this claim has been made out and the plaintiff is entitled to be paid for an additional 80.3 m³of 32 MPA concrete at the variation schedule rate of $1,336 per cubic metre, a total of $107,280.80.

Services support tree slabs

[104]
The drawings show a series of concrete slabs described as “services support tree”, most in the form of rectangular slabs, a line of which ran between the two lines of enclosure slabs, with four square slabs at the end of the line outside the control room: drawing CO241-CF-002. Details of the design, which was quite rudimentary, appeared on drawing CO241-CF-005. Nevertheless, the civil works specification made no express reference to them, and the price schedule in the specification contained no line item for them, nor was there any catch-all line item. As mentioned earlier, there were a series of specifically defined items of work for each of which a lump sum price was required, with a total of those prices to be provided.

[105]
More importantly for present purposes, this was the basis upon which the plaintiff’s tender was provided. There was no item in that tender which could sensibly be interpreted as, or as including, the services support tree slabs, and the only rational interpretation of the tender is that that work was not included in the work the plaintiff was offering to do.^[112]That was the tender the defendant accepted.^[113]That produced a contract to do the specific work identified in the tender for their respective prices, not one to do “all civil works” for a lump sum. Nevertheless, the services support tree slabs were in fact constructed by the plaintiff, and accepted by the defendant.^[114]

[106]
The defendant’s case, such as it is, is based on the notion that, because reference was made in the diagrams to the services tree support slabs, that work was part of the contract. The difficulty with that argument is that it is obvious that not everything which is referred to on the diagrams is part of the contract, nor does the contract anywhere say that the scope of work under the contract was defined by the content of the diagrams. For example, the drawings show a security fence but that was to be provided by someone else, as stated expressly in paragraph 8.10 of the specification. In any case, what matters is the correct interpretation of the tender, since it was that tender that was accepted by the defendant. There is no rational way that tender can be interpreted as including the service support tree slabs. The defendant’s proposition is in effect that the plaintiff was offering to do that work for nothing. That is a manifestly irrational interpretation of the tender, and hence the resulting contract. An interpretation of a contract which produces an irrational result is to be avoided.^[115]Obviously the defendant, having taken the benefit of this work, must pay for it.

[107]
The real situation here is that in this respect the defendant botched the paperwork, and is trying to pass on to the plaintiff the burden of its mistake. There is no reason why any court should countenance such behaviour. Indeed, in my opinion, that this claim was resisted by the defendant reflects adversely on its commercial morality. No honourable contractor would take the benefit of this work and refuse to pay for it. The reasonable cost of doing this work is plainly recoverable, either as a variation under the contract or on a quantum merit.

[108]
The plaintiff has priced the work on the basis of the rates agreed to in the contract as the rates for variations. That is some evidence that those rates were reasonable for doing additional work. There is no evidence from the defendant to contradict that proposition, nor was the plaintiff’s evidence in relation to this matter challenged, though the submission was made that there was no evidence to support the quantum of the claim. There was however no dispute that the services support tree slabs were constructed in accordance with the drawings. Those drawings show that the rectangular slabs were 4 metres by 0.6 of a metre by 0.5 of a metre, 1.2 cubic metres each, and 20 were required, a total of 24 m³ of concrete, assuming no over break. The small square slabs were 1.5 metres squared by 0.4 of a metre or 0.9 m³ each, 3.6 m³, giving a total volume of 32 MPA concrete of 27.6 m³.

[109]
At the contract rate for 32 MPA concrete of $1,336 per cubic metre, this is an amount of $36,873.60. There was a larger amount in Exhibit 51, Mr Speziali’s internal estimate, for constructing these, of $42,768. Clause 11.3.1 of the specification makes the unit rate “inclusive of all tasks for supply and installation”. I doubt that this would cover things like the installation of the 8 bolts in each of the rectangular slabs for the steel services support trees to be bolted on, or the installation of a connection so that the reinforcing can be connected to the earthing grid, or perhaps for that matter the reinforcing itself. Since the plaintiff claimed only on the basis of the rate per cubic metre, there was no issue at the trial about any additional costs. In those circumstances I will not allow any additional costs. But the defendant did not admit the amount of the claim, which in my opinion on the evidence was too low, and in those circumstances it is appropriate to allow the amount disclosed by the evidence.^[116]For this part of the plaintiff’s claim therefore I allow $36,873.60.

Above and below ground services not removed

[110]
The statement of claim includes a claim for the amount of $32,800 in respect of the costs incurred by the plaintiff because of the failure of Xstrata to remove above and below ground services, something which, under the specification, the defendant promised that it would do. The defendant is therefore liable for all the costs of additional work caused by the presence of those services. The plaintiff however in submissions acknowledged that this claim was compromised for the sum of $24,740 which was paid: Exhibit 41.^[117]In those circumstances, the plaintiff did not press this claim, so I do not need to say anything more about it.

Pavement timing claim

[111]
The plaintiff’s case is that the original intention was that, after it had finished doing other work on the site, it would lay road base over most of the site, which involved spreading and compacting to a particular standard 150 millimetres of crushed rock: p 3-21. By this time the various drain pipes to be laid as part of the plaintiff’s contract would already have been laid. When this was done, everything required of the plaintiff under its contract except for chip sealing the site, that is laying two coats of bitumen and gravel above the compacted crushed rock, would have been completed, and the plaintiff could demobilise from the site, because the chip sealing was to be done later by a specialist subcontractor anyway.^[118]

[112]
The site was to have installed, as part of this project, an earth grid, which involved burying in the ground a grid of wires over most of the site, which wires were to be connected and connected to earthing cables on the generator slabs. This was quite an extensive exercise as shown by the diagram for it, Exhibit 58, and involved digging a large number of trenches within the site. At one point the specifications for the civil work (Exhibit 9) included installation and testing of the earth grid, but by the time the final specification was prepared this had been deleted from the work to be done. If the work had been done as part of the plaintiff’s work, no doubt it would have been done before the road base was laid, in the same way that the drain pipes were laid beforehand. However, once it was deleted from the plaintiff’s contract, it inevitably meant the earth grid would be constructed separately by someone else, after the plaintiff’s work had finished.

[113]
There were also some other underground services, for ordinary electricity supply, water, telephones and apparently for a gas pipe, all of which were to be installed by others after the civil work had been done. These other services in themselves might not have been very disruptive to the compacted road base, but between them and the trenching required for the earth grid there would have been considerable disruption to the compacted road base^[119]between when it was laid by the plaintiff and when the chip seal subcontractor was due to put the bitumen coating on it, at the end of all the work. In these circumstances, Mr Speziali was concerned that a good deal of work would have to be done to re-establish a properly compacted road base of crushed rock prior to laying the bitumen coat, which would involve his bringing a team back to the site anyway. He therefore suggested to Mr Stevens that laying the road base be postponed until just before the chip seal was laid, after the work involved in burying anything else on the site had already been done.^[120]

[114]
Ultimately this is what occurred, and in those circumstances it must have occurred on the basis that the defendant decided that the work would be done that way; the defendant’s evidence at the trial however was that this was something the plaintiff sought, and the defendant essentially just went along with it to suit the plaintiff, so that it was not a variation directed by the defendant, and the plaintiff was not entitled to claim additional payment under the variation clause in the contract.^[121]

[115]
In terms of the evidence of the arrangement between the parties about the change in the program in this way, the documents show that the evidence of Mr Speziali about the timing of various conversations was not reliable.^[122]It is clear that the issue had been raised as early as February 2007, because on 26 February MrStevens sent an email to Mr Evans and another officer of the defendant proposing that the laying of earthing and underground services, and the footings and support for the control room, be completed before the road base was laid: Exhibit 84. Both MrStevens and MrSpeziali said that the initiative for the change came from the plaintiff, so the plaintiff must have raised the issue prior to this email being sent. Minutes kept by Mr Stevens of a site meeting on 15 March 2007 (Exhibit 86) recorded:

“Crushed rock not to be laid until nearer the end of the job, when all heavy machinery work has been completed”.^[123]

[116]
The same day Mr Stevens sent an email to Mr Evans (Exhibit 88) which noted that the site meeting had been held about civil works and continued:

“We have a few decisions on site that will differ from program, steps to finish civil work are as follows:

… [the plaintiff] will not come back to do spoon drains and crushed rock layer until all equipment and heavy cranes and the likes are finished on site … .”

[117]
That the defendant was treating this as a variation under the contract was confirmed by an exchange of emails in August 2007. On 2 August 2007 the plaintiff advised the defendant that another subcontractor’s work had to be completed before the pavement work was started, and that the plaintiff would submit a variation claim for additional cost of carrying out the pavement work at this stage of the project: Exhibit 20. The next day the defendant advised the plaintiff that the other subcontractor’s work would be complete before the plaintiff arrived back on site: Exhibit 42. On 7 August 2007 by Exhibit 21 the plaintiff submitted details of the pavement variation works to the defendant and pointed out that additional costs included additional civil crew establishment costs, and additional labour intensive activities. The same day Mr Evans replied stating among other things that the defendant realised “there has been a variation regarding the crushed rock …”: Exhibit 44.

[118]
On 25 August 2007 the defendant sent the plaintiff a letter Exhibit 33 which stated:

“We accept there is a variation for remobilisation and additional pavement works. [We] will accept reasonable costs for remobilisation … [and] reasonable costs for additional handwork … . [We] will accept costs for the re-preparation of the area on site offset by others laying the gas pipe and other services which had not been reinstated to the satisfaction of [the parties].”

[119]
The defendant requested the plaintiff to proceed with the contract works, and continued: “We will discuss and agree the details pertaining to this variation … .” On 29 August there was a telephone conversation between Mr Evans and Mr Kamali. MrKamali recorded his understanding of the outcome of the discussion in Exhibit 23, an email he sent Mr Evans the following day, which stated relevantly:

“The variation activity to be carried on daily labour and plant hire basis. Nortask will appoint a person to oversee the progress and record variation activities. These daily records to be signed off by the site manager. The value for this variation will be calculated using signed dockets.”^[124]

[120]
There was no email in response to this rejecting this version of what had been agreed during the conversation, nor did the defendant lead any evidence to contradict this proposition, nor was Mr Kamali’s evidence about this conversation challenged under cross-examination. When work started however it emerged that there were other contractors on the site whose presence was interfering with the work involved in laying the pavement.^[125]This led to an exchange of emails between the parties on 7 September 2007 (Exhibit 91), and on 10 September 2007 Mr Evans sent Mr Kamali an email (Exhibit 90) which stated:

“My understanding of the site issues which [Mr Stevens and MrSpeziali] are managing is that in addition to the variations already approved i.e. (a) remobilisation (b) additional hand work required due to steelwork being in place and (c) rework of the areas upset by others to install services there will be an additional variation (d) for the inconvenience caused to Nortask due to the critical ODG^[126] work on the powerlines.”

[121]
In the light of the terms of this agreement, I cannot accept the evidence of Mr Stevens that there was in fact little inconvenience caused to the plaintiff because he arranged on a day to day basis that the plaintiff would work in areas which were not being worked on by the subcontractor working on the powerlines: p 6-78. Plainly if that were in fact occurring there would be no reason for Mr Evans to have agreed to include an allowance for such inconvenience in the agreed variation. Apart from this, in the light of this email the proposition that there was a variation under the contract for the purposes of postponing the work of laying the road base is, in my opinion, incontrovertible. It was only when the pavement work had been done and the plaintiff’s variation claim (Exhibit 24) was lodged on 3 October 2007 that the defendant attempted to back out of the agreement. In my view, it was too late by then for the defendant to dispute that this was a variation under the contract.

[122]
It is certainly the case that the matter was handled somewhat informally between the parties at the time, and the plaintiff has not been able to produce any written direction for a variation in this way. Nevertheless, there is a fundamental inconsistency between the position the defendant adopted at the trial and the position which it had adopted previously in relation to this matter. Previously the defendant’s position was that this was a variation,^[127]and parts of what the plaintiff was claiming about this were accepted by the defendant, though the parties never reached agreement on just what was payable; the plaintiff always claimed that there were additional amounts payable to which the defendant would not agree. The defendant’s position at trial was essentially that it would pay the cost of the plaintiff’s remobilising on site in order to do this work at a time when it otherwise did not need to have workers on site, and for what was described as “hand work,” that is, additional work made necessary specifically by the presence of structures on the site, and extra costs caused by interference from others, but that this was under a specific agreement to pay these costs, not a variation under the contract.^[128]

[123]
I do not think it is really necessary for me to resolve the question of whether there was a direction by the defendant for the plaintiff to do this work later, since the defendant accepted that there was a variation in this respect before the work was done. However, in case a different view may be taken elsewhere, I am prepared to infer, from what passed between the parties, that there was such a direction. The fact that it was suggested by Mr Speziali is not to the point. How the work was to be done on the site was, as between the plaintiff and the defendant, under the control of the defendant, so it was the defendant’s decision and direction that led to the work being done later rather than at the end of the other work done by the plaintiff on the site, which was what it had contracted to do.

[124]
In those circumstances, the contractual entitlement for remuneration for variations, where the variation is to be valued in accordance with Clause 40.5, is to be followed, unless the parties agree on the price for the variation, which ultimately did not occur: Clause 40.3. In Clause 40.5, specific rates or prices prescribed by the subcontract are to be applied, or if that does not apply, rates or prices in a priced bill of quantities or schedule of rates shall be used to the extent that it is reasonable to use them: Clauses (a) and (b). If neither of these apply, reasonable rates or prices shall be used in any valuation made: Clause (c). In this case there was a schedule of rates in the contract, the schedule provided in the plaintiff’s tender which was accepted by the defendant.

[125]
It seems to me that there was fundamental error in the defendant’s approach to this claim. The defendant’s submission was that this was not a proper variation under the contract, but rather that the defendant had agreed to pay certain costs and was only liable for costs which fell into those categories. I do not accept that analysis. The plaintiff under the contract was entitled to lay the road base at the end of its other work on the site. Given the extent of the disruption to the road base that would have occurred as a result of the work of other subcontractors after this, particularly in relation to laying the earthing grid, that was not a sensible way to programme the work. When this was pointed out to the defendant, it decided that this work would be done by the plaintiff later. It was the deferring of this work until a later stage in the project which constituted the variation, and under Clause 40.5 it is the cost arising from that deferral which (absent agreement) the defendant has to pay. That is, it is all the extra cost caused to the plaintiff, valued in accordance with Clause 40.5, not simply those bits of the extra cost which the defendant has admitted it has to pay.^[129]

[126]
The plaintiff submitted that the effect of what had passed between the parties was that on 29 August 2007 there was an agreement for the work involved in laying the pavement to be carried out as day work under Clause 41 of the general conditions. It was submitted that a consequence of this is that no deduction should be made for the cost which would have been incurred had the work been carried out pursuant to the contract without the variation. The difficulty with this argument is that the email, Exhibit 23, does not indicate that what is to be done on a daily labour and plant hire basis is the whole of the process of laying the road base, but only “the variation activity”. The parties had the whole time up until then been talking in terms of a variation on the basis that the defendant would pay increased costs caused by the fact that this work was being done later than originally planned, rather than being done at the end of the time the plaintiff was otherwise working on the site.

[127]
It is not immediately obvious to me why the fact that this would be a more expensive way of doing the work from the point of view of the plaintiff would justify the plaintiff in recovering the whole cost of doing that work. The logic of the situation in my opinion supports the natural reading of the email Exhibit 23, which is that it is concerned with determining the amount payable for the extra work involved in laying the pavement at this time. Nothing was said by Mr Kamali which would produce a different interpretation of the position set out in Exhibit 23. Indeed, when giving evidence about how he calculated the additionalcosts associated with the change in programming of the pavement, Mr Kamali spoke about the additional costs for site establishment, labour and plant required for additional work, and some work repairing the surface on which the road base was to be laid which had been disturbed by other work carried out on the site: p 73.^[130]Further, Mr Kamali spoke of calculating the claim by reference to the hourly rates provided in the contract: p 74. So far as I can tell, where the contract provides a contractor’s plant and labour rate in schedule 11.3.2, that rate is generally used in Exhibit 24, though there are a number of items in Exhibit 24 for which no particular rate is specified in that schedule.

[128]
On the other hand, day work under Clause 41 is to be priced by reference to the amount of wages and allowances paid or payable by the subcontractor, or amounts of actual hire charges in respect of plant, and the actual cost to the subcontractor or materials supplied etc. It does not appear that Exhibit 24 has been calculated on that basis.^[131]There is also provision for an allowance at a rate stated in the annexure to cover overheads, administrative costs, site supervision, establishment costs, attendance and profit (para (f)) and no such allowance was claimed.^[132]There was a separate claim made in respect of mobilisation and demobilisation by reference to the hours spent by the individual employees on those processes, and a separate claim for supervision at an hourly rate. The contract set out rates for doing work and supplying equipment, and indeed for supplying certain materials, and one would expect that ordinarily that would be the preferable approach when valuing a variation.

[129]
Exhibit 24 appears to have been calculated by reference to the additional work involved, and a breakdown table is set out at the end which supports this proposition. Some of the claims seem strange as claims for additional work, particularly claims of several days’ work for a roller, when obviously rollers would have been used anyway to do the work had it been done at the earlier time.^[133]On the face of it however, Exhibit 24 has been calculated by reference to additional work payable under the variation. Furthermore, the defendant’s position as outlined in written submissions was that it was liable for additional costs, at least with respect to remobilisation, extra hand work, and costs associated with interference from other contractors, but put the plaintiff to proof in relation to its quantum.^[134]I reject the plaintiff’s submission that the claim is to be assessed under Clause 41, and that no allowance should be made for the cost of doing the work at the original stage under the contract.

[130]
There were places in the site where equipment in connection with the generators, or the services support trees, prevented the use of the machinery ordinarily used for laying compacted road base,^[135]and it appears that at the time the defendant was prepared to pay additional costs associated with laying and compacting road base in these areas as a variation under the contract.^[136]Mr Stevens said that he would several times each day walk around the site and note what employees were doing,^[137]and he prepared from that a document (the civil log, Exhibit 83) showing what each of the plaintiff’s employees was doing each day, with the work divided (by him) between work which had nothing to do with the road base, work which was covered by the variation (which he designated as hand work), work which was not covered by the variation, and, in the case of some employees some of the time, work part of which fell into both categories. It appears that even at this stage the defendant was anticipating a dispute about the cost of doing the work in this way, since Mr Stevens did not keep this sort of detailed log in relation to all of the work undertaken by the plaintiff on the site, but only in respect of this particular work: Stevens p 7-36.

[131]
Although both parties at about the time used the expression “hand work”, plainly the parties were not using that term in the same way; in each case it was being used by reference to the work said to be covered by the variation, but on their respective tests. The use of the term “hand work” was somewhat misleading, because there was inevitably some machinery used in this work, including for example some use of a bobcat to shift material around, and the use of small hand operated compacting machines to compact it. The plaintiff also kept some records of what was being done on the site, in the form of a work diary,^[138]and by preparing dockets setting out how many hours work were claimed for what workers and machines under the variation that day: Exhibit 27;^[139]Exhibit 56, a separate set of dockets prepared as well but signed only by the plaintiff’s supervisor.

[132]
Mr S Speziali conceded that there would have been some work to be done by hand anyway if the road base had been laid when originally planned, because it had to be laid around the various concrete slabs which had already been constructed, and in one case, a shed which had already been erected: p 22. He claimed, and in principle this was not contentious, that the presence of structures erected subsequently meant that it was more difficult to use machinery, particularly graders and rollers, and that a lot more work had to be done without the use of that machinery, particularly where the use of at least larger machines was obstructed by the service support trees which had by then been erected.^[140]That was obviously correct, though I would expect that there were still relatively open areas on the site where graders and rollers could have been used to lay the road base.

[133]
Mr Speziali may have been taking a somewhat expansive view of what was additional work. On the other hand, my impression is that Mr Stevens was taking a particularly narrow view of what was “hand work” covered by the variation on his test. There is also an issue as to the reliability of his records generally. Apart from the civil log, he also kept a site diary, which to some extent recorded what work was being done on site by the plaintiff’s employees, though in less detail: Exhibit 92.^[141]He agreed that, in principle, the site diary should tally with the civil log, exactly if they had both been kept properly: p 7-22, 23. It emerged however, from cross-examination, that there were significant inconsistencies on 3 September, where Mr Stevens conceded under cross-examination that the civil log appeared to have omitted a number of people engaged on what he conceded was “hand work” (p 7-26-28), and also a number of inconsistencies on later days, including in relation to a failure to show that one of those doing hand work was “Steven”, a reference to Mr Steven Speziali: p 7-29-32. In the light of these inconsistencies, it is difficult to regard Mr Steven’s evidence about these matters, particularly as recorded in the civil log, as reliable.

[134]
Each day dockets were provided to Mr Stevens (Exhibit 27) most of which he signed after he had endorsed them “site agrees”; the reference to “site” was a reference to himself: p 7-41, 42. In Exhibit 83, Mr Stevens said that he signed the plaintiff’s hire dockets for each day “to verify quantities of labour and equipment on site only”. Even on this basis, there was inconsistency between the dockets and the civil log, Exhibit 83. For example on 3 September the docket in Exhibit 27 that Mr Stevens signed records a whacker packer as well as the equipment listed in the civil log, and four operators rather than the three in the civil log; in addition the hours are shown as 10 rather than 9.5. On 4 September again the whacker packer and one of the operators were omitted, along with a loader and a 10 metre tipper.

[135]
My examination of the civil log, Exhibit 83, revealed a good deal of work which is obviously work made necessary by the presence of the obstructions on the site, but which was not counted by Mr Stevens as part of the variation work. In notes for 3 September, there is an observation at 11.30am “Dale/Jo/Chris hand shovelling north of control between trees” which is obviously work which cannot be done in the ordinary way by machinery because of the presence of the service support trees. No time was included for Chris or Jo in the work said by Mr Stevens to be within the variation; although one hour for Dale was said to be variation work, it did not include this work. There was also a reference to people using a hose to wet the ground in areas near the enclosures, which strikes me as a sort of thing that would have been dealt with by a water truck had the ordinary procedure for laying road base been followed; this was not included as variation work by Mr Stevens. On 5 September there is a reference to the use of a vibrating plate around one enclosure which was not regarded as work within the variation, while at one point three people, Ricky, Andrew and Norm, were recorded as hand raking and screeding between two of the enclosures, and one of the three was not credited with any variation work that day.

[136]
On 6 September there are notes about Chris hand shovelling on the south side of the shed, and Jo and “Aero” hand raking around the workshop, which were not regarded as part of the variation work. On 7 September there are references to two people spreading crushed rock around the services support trees at the northern end, which were not regarded as being within the variation, while work using a whacker packer between the services support trees at the northern end of the site was regarded as work which was only partly within the variation, when it is obviously entirely within the variation. On 10 September there is a note that “Hermes, Chris, Rudy and Jo working through the support tree area, going through and doing patch work and final trim,” and there was said to be a photo showing Norm and Andrews screeding crushed rock between enclosure slabs 10 and 11. But in the comments in the table there is a note that “Chris was the only person today that does any work around the enclosures… .”

[137]
I do not propose to waste more time going through this document. My firm impression overall is that in Exhibit 83 Mr Stevens was using a strange, and wholly unrealistic, test for what was properly included in the variation. In my view the variation includes all work which had to be done in a more expensive way than would have been the case if the work had been done at the end of the plaintiff’s other work on the site, that is to say almost all of the work which involved spreading and compacting the road base other than by the use of graders and rollers. Overall, I consider Exhibit 83 worthless as evidence of what additional work of the plaintiff was “hand work” properly within this variation. Indeed, I regard Mr Stevens’ evidence as suspect because he was responsible for the production of it.

[138]
Apart from mobilisation and demobilisation costs, the defendant in submissions conceded only $3,312.50 for “additional hand work”. Most of this was attributable to the work of men for whom the contract rate for a labourer of $55 per hour was allowed, suggesting a total of only about 60 hours of work. My examination of the photographs in Exhibit 4 suggests to me that it would be difficult to use the ordinary grader and roller techniques in the area between the various generator sets,^[142]which is a large part of the area to be sealed, and in several other areas. It seems to me obvious that there would have been a great deal of extra work involved in laying this road base because of the presence of the structures on the site. There was even evidence from Mr Stevens that there was a lot of hand work that needed to be done: Exhibit 57; Exhibit 89; p 6-76. That concession seems to me to be completely inconsistent with the number of hours allowed by Mr Stevens in the civil log. Further, the defendant’s submissions were based on the civil log in its original form, and made no allowance for the errors in it conceded by Mr Stevens under cross-examination: p 7,-25-27.

[139]
I have also compared the total hours said to be worked each day by the plaintiff’s people in Exhibit 83 with the total hours said to be worked by the plaintiff each day in Exhibit 76, both of which were documents produced by Mr Stevens. The results are not consistent. Sometimes the difference is small, but sometimes quite large; on 10 September Exhibit 83 shows 10 men each working for 10 hours, but Exhibit 76 shows 135 hours worked by the plaintiff. The explanation for this cannot be that Exhibit 76 includes hours worked by the people from Mt Isa branch of the plaintiff,^[143]because there are a number of days where the figure in Exhibit 76 is less than the total hours recorded in Exhibit 83, for example; 3 September, 4 September and 5 September, where Exhibit 76 has 100 hours and Exhibit 83, 115 hours. There is even at least one discrepancy between the defendant’s site diary Exhibit 92 and the figures in Exhibit 76, from where they came. The site diary shows that there were Mt Isa branch employees working during this period, commonly 9 or 18 hours a day, which makes the discrepancy in relation to the hours worked with Exhibit 83 even greater.

[140]
There were also inconsistencies between the dockets in Exhibit 27, signed by MrStevens agreeing to the quantities of people and machines on site for the day, and the records in the daily site diary, Exhibit 92. Apart from this, there are some references to equipment in Mr Speziali’s diary, Exhibit 60, but it is not clear that these were intended to be comprehensive. There was a reference on 3 September to a small grader and a 2 tonne roller, as well as two backhoes, two bobcats and one vibrating plate; the docket in Exhibit 27 referred to the backhoes, bobcats, roller and vibrating plate, but not the grader and the whacker packer.

[141]
There was also a set of dockets in Exhibit 56, which were signed by the person for the plaintiff who was on site in order to keep track of who was there and what equipment was there.^[144]The docket for 3 September in Exhibit 56 does refer to the whacker packer apart from the items recorded in the Exhibit 27 docket, but does not refer to the grader referred to in the diary, Exhibit 60. The same applies to the docket for 4 September in Exhibit 56, which does not refer to the grader, nor for that matter does the docket in Exhibit 27, but it is clear from Mr Speziali’s diary Exhibit 60 for 4 September that there was a grader working on the site that day, and that one was to be on site as well the following day. A grader does not feature in either of the plaintiff’s dockets for 5 September, though it does get a mention in the civil log Exhibit 83 and the site diary Exhibit 92.

[142]
The defendant suggested that the dockets in Exhibit 27 essentially covered all of the people and all of the work being done on the site, rather than just that part which was properly within the variation. In the first week, the number of hours claimed in the dockets in Exhibit 27 produce totals which are quite similar to the totals shown for the hours on site for the plaintiff in Mr Stevens’ record, Exhibit 76, for the period 3-9 September; thereafter however the hours claimed in the dockets are very much less than the hours recorded in Exhibit 76 as hours for the plaintiff’s employees on site. The plaintiff’s Dalby crew was not demobilised until 21 September. It seems to me that initially the plaintiff was concentrating on doing work in the areas where there were services support trees, and around the enclosures, where presumably the other subcontractors were not working, so that effectively the work then being done was work which was being done in a different and more expensive way than would have been the case if the road base had been laid with graders and rollers. That supports the view that initially what was claimed for in these dockets was essentially additional work, that is, work which was done in a more expensive way because of the presence of obstructions on the site.

[143]
In these circumstances, it is very difficult to work out just what was going on on this site on the days when the road base was actually being laid. I have some doubts about the reliability of any particular set of evidence. The plaintiff’s evidence seems to be focussed on people and equipment within the scope of the plaintiff’s concept of work which amounted to a variation, rather than all of the people and equipment working on laying the road base, while the defendant’s records do not appear to be particularly reliable even as to who was there and what equipment was being used overall, apart from the conclusion that I have arrived at about the value of the defendant’s division of work between the variation and the contract work.

[144]
In principle it should not be that difficult to work out what the extra cost of laying the road base was, so as to work out the amount payable pursuant to this variation: what it in fact cost the plaintiff to lay the road base as and when it was laid, minus what it would have cost if it had been laid in accordance with the contract. Given the history of the tendering, I suspect the latter can be quantified by the price attributed to supplying and “spreading” crushed rock in the plaintiff’s first tender Exhibit 11, schedule 11.2(8) - $196,400, but there was no evidence of this.^[145]

[145]
A proposed work schedule prepared by the defendant and sent to the plaintiff on 1 February 2007 allowed six days to lay the road base: Exhibit 18. A schedule prepared by the plaintiff and included in Exhibit 17, and subsequently in the formal contract document Exhibit 52, in which the road base was to be laid after the other work to be done by the plaintiff, allowed 12 days for this work, but that included an allowance of “catch up” time.^[146]

[146]
The plaintiff obtained a quote from another contractor to supply and lay the road base, at a price of $28 per square metre, which comes to about $340,000, far more than the amount included in the contract for earthworks, which included levelling the site as well as spreading and compacting the gravel. In a letter dated 23 August 2007 from the plaintiff to the defendant (Exhibit 22) the plaintiff estimated a figure of $112,000 for the plant and labour costs required for the additional work in respect of places with limited access. As well, MrKamali provided some details of an estimate for the additional work required because of the limited access available, and as a result of breaking up the surface because of other excavations, with a view to submitting $137,400 as a lump sum price for the variation. This letter stated that the original tender was based on a cost of the supply of the material for the road base of $103,680, and the amount allowed for plant and labour (at specified rates) which totalled $35,300. The letter did not explain why there was a difference between the total of these figures, $138,980, and the amount of $196,400 included in the first tender for what seems to be the same thing, but the explanation may be that the latter figure included something else. That letter does at least suggest that most of the work would have been done with a grader, a roller, a backhoe and a water truck, though there would have been some hand work for two men and a vibrator plate. It also suggests that the roller would have been much larger than the one actually used on the site. The number of hours (60 each for the grader and the roller) suggest that six days really were going to be needed for doing this work at that stage.

[147]
It follows that the effect of the extra work because of the changed circumstances was not so much that the job took longer, but that there were a lot more people involved, and some extra equipment. I could understand that if the other evidence as to what was on site referred to the items listed in Exhibit 22, and other extra equipment, but the evidence does not. There is no reference to a water truck for example except in the site diary Exhibit 92, and it is not clear whether there was a small roller used as well as the 6 tonne roller which was apparently to be used anyway according to Exhibit 22, or whether there was only one roller on site, as Exhibit 92 states. The photographs do not appear to show either a water truck or a large roller, but there may have been a tendency for the photographs to focus on pieces of equipment which would ordinarily not have been there.

[148]
Nevertheless, there is I think some common ground on the evidence, from which it is possible to identify additional costs as a result of the variation. The civil log Exhibit 83 speaks of the road base being laid over the period 3-9 September, and there are substantial claims in Exhibit 27 and 24 in respect of that period; there was also a claim for 10 September in the plaintiff’s documents, but no such work in Exhibit 83. Nevertheless, the defendant’s documents show a grader on site for at least five hours, which suggests that a certain amount of work was being done finishing off the road base, even though the plaintiff does seem to have also moved on to work on the spoon drains. I will therefore treat the work on the road base as extending over the period 3 to 10 September 2007, eight days instead of the original six. Overall my impression is that any work on the road base thereafter was concerned with repairing damage caused by other subcontractors, or reinstating the road base beside the spoon drains when they were constructed.

[149]
On each of the days 3 – 10 September there were two bobcats and two backhoes used on the site, but Exhibit 22 indicates that a backhoe would have been used anyway, and that is supported by the evidence of Mr Steven Speziali: p 23. On the other hand, the bobcats appear to have been made necessary only because of the need to work in confined spaces. I regard the two bobcats and one of the backhoes as in effect extra equipment made necessary because of the variation. The grader, the vibrator plate, the water truck and a roller would have been used anyway, though it may be that a larger roller would have been used had it not been for the various obstructions. The only allowance I will make for them is for the extra two days of the road base work, because of delays as discussed earlier, at hourly rates of $160, $12, $110 and $100, which are in Exhibit 126 or reasonable by comparison with the rates given there. This is a total of $7,640.

[150]
For the extra backhoe I will therefore allow eight days, seven at 10 hours and one at five hours, a total 85 hours. The rate in clause 11.3.2 in Exhibit 16 is $90 per hour, except on Sunday when it is $105 per hour, which comes to $7,725. There is no figure for a bobcat in Exhibit 16, but the plaintiff has claimed $80 per hour in Exhibit 24, which strikes me as reasonable, so the total for each bobcat is $5,960; $11,920 for both. There is also no rate in Exhibit 16 for a whacker packer, the plaintiff has claimed $120 per day, which again strikes me as reasonable, and for seven days I allow $840.

[151]
With regard to labourers, it seems that there were four men working on each of 3 and 4 September, but on 3 September one of them worked for only two hours. There were five men working each of the following days, though on 5 September one man worked for only three hours. There were eight men working on 8 September for 10 hours. On 9 September there were three men working five hours each, and on 10 September there were seven men working for five hours each. It follows that, apart from the Sunday work when there were 15 hours worked, there were a total of 330 hours worked at the weekday rate of $55 an hour, and 15 hours worked at the Sunday rate of $70 per hour, a total of $19,200. However, Exhibit 22 assumed that there would have been two men working 40 hours between them, so 40 hours should be taken off this figure, which brings the total down by $2,200, to $17,000.

[152]
A claim was also made for Mr Speziali’s time, as a supervisor on the site, but it seems to me that if this work had been done in the manner originally contemplated it would have taken six days, and that Mr Speziali would have been supervising it anyway, so most of this is not extra work. The fact that during this period most of his attention may have been directed to the supervision of the manual work does not detract from the fact that his time would have been occupied by supervising laying the road base anyway. It does appear however that there was an extra day and a half involved, on the Sunday and the Monday, and he is entitled to $700 for the Monday and $425 for the Sunday (five hours at $85), a total of $1,125.

[153]
Apart from that, there was another person employed, essentially to keep a record of who was working on the site and what equipment was on the site, with a view to putting together the dockets in Exhibit 27 and Exhibit 56. Bearing in mind the extra effort that Mr Stevens was going to at the time as well, and the fact that the defendant was obviously going to be difficult about this, I think it was reasonable for the plaintiff to engage someone in that position, in effect another supervisor. For the eight days, I allow $5,325.

[154]
There was obviously also extra work involved because of the disruption caused by other contractors. This seems to fall into three categories. The first was reinstating areas where trenches have been dug by other contractors, for example to bury the earthing grid, without properly preparing the sub-base afterwards.^[147]The second was that there were other subcontractors working on the site at the same time, so to some extent the plaintiff had to work around them, something which it seems would not have been a factor if the work had been done at the end of the plaintiff’s other work, when it appears that it was the only subcontractor on the site. Finally, there was damage to the plaintiff’s work by other subcontractors on the site. For example, Exhibit 24 refers to the need to reinstate some of the road base after flooding which was produced by some work being done by one of the other subcontractors. Mr Stevens conceded that it was necessary to rework areas where the pavement work was damaged by others: p 6-92; Exhibit 93. No allowance has been made for this in the defendant’s submissions as to the amount properly payable.

[155]
According to Mr Speziali’s diary, Exhibit 60, when they arrived back on site on 3 September 2007 there was a lot of equipment being used by other subcontractors on the site, and a lot of damage had been done to the existing surface, which required a good deal of restoration before the gravel could be laid. This diary does not record any particular detail of who did what that day, but Mr Stevens’ work diary showed five of the plaintiff’s employees doing work which Mr Stevens conceded under cross-examination should have been included in the variation claim.

[156]
There is also the consideration that it is obvious from Exhibit 60 that there was often interference with the plaintiff’s work from the presence of other subcontractors on the site, which would have meant at times that the plaintiff’s employees were not engaged in useful activity. For that matter there are entries in Exhibit 83 which support the proposition that he was unhappy about the situation, though Mr Stevens suggested that he was arranging everything satisfactorily, which I do not accept. This is something which is also part of the costs associated with doing work at this stage, and indeed was an aspect of the claim which the defendant at one stage said it agreed to, though no allowance for it was made in the amount conceded in submissions on behalf of the defendant.

[157]
The remaining claims in respect of the period from 11 to 20 September, a period when basically the plaintiff was constructing the spoon drains, relate to a variety of matters. On two days there are claims for digging out obstructions, either a rock or a pipe, found when excavating for a spoon drain.^[148]It occurs to me that the former is an aspect of the latent condition claim and the latter is an aspect of the underground services claim, and neither really had anything to do with the process of laying road base. On 12 September there was a claim as well for some additional work associated with relocating part of the spoon drain,^[149]which would appear to be a separate variation, and some final trim said to be a reworking because of trafficking.^[150]

[158]
According to Exhibit 83 on 12 September there was no work on the crushed rock done, and the plaintiff was just working on constructing the spoon drains. But Exhibit 92, Mr Stevens’ site diary, for 12 September records the plaintiff’s work as “preparing crushed rock surface, continue with poured spoon drains … .” There are similar entries on 13 and 14 September: Exhibit 105. On the docket in Exhibit 27 for 12 September Mr Stevens agreed with the men on site but did not agree with the hours claimed when he signed it. Accordingly I am not prepared to accept the denial of any road base work on this day in Exhibit 83, bearing in mind the other problems I have identified with it.

[159]
On 15 September 2007 there is a claim for “hand trimming” in areas where other subcontractors had been working after they had vacated the site: Exhibit 24. The docket in Exhibit 56 claims a total of 10.5 hours each for five men for this, along with equipment including a grader and a water truck, each for 4 hours, but the two dockets in Exhibit 27 for this, 51168 and 51169, claim a total of 7.5 hours for five men, and also refer to the grader and the water truck. Mr Stevens did not sign the dockets for the days after 12 September. There is nothing about this work in Exhibit 105, but Exhibit 83 mentions “Photo’s also show Nortask in south east corner of site reworking areas around poles and stays with which is a variation works.” Later the note for 15 September says, inconsistently, “I have no evidence in any of the photo’s to suggest …work achieved today … around power poles and stays … .” It goes on to admit that three men were working on areas damaged by other subcontractors for an estimated 4 hours each. I accept that there was some repair work on this day, but I am wary about the evidence to quantify it. I allow 3 labourers and two supervisors at 6 hours each, but not the grader or the water truck. This comes to $1,830.

[160]
On 16 September there is a claim for further work, hand trimming and rework at the gas slab (Exhibit 27), or near main transformer, two large power poles and the gas slab (Exhibits 24, 56) which took five men four hours (Exhibits 24, 27) or three men a total of 20.5 hours: Exhibit 56. Exhibit 105 has only four men on site for the final trim along the spoon drains, and there is no support for this claim in Exhibit 83. In view of the inconsistency in the plaintiff’s evidence, I will not allow anything for this day. There is a claim in Exhibit 24 that time was spent drying out ponded water run on site by another subcontractor to cool down bitumen. There is a docket for this in Exhibit 56 but nothing in Exhibit 27, and no support for this in Exhibit 83. I find this claim very odd, because it seems to me that if the road base had been laid properly this could not have been a problem, as the water would have either sunk in or run off. I will not allow this.

[161]
On 18 September there was a claim for hand watering and final trim, said to involve nine men plus the two supervisors, two vibrating plates and a roller: Exhibit 24. The Exhibit 27 docket added a water truck, and was endorsed “site queries quantities and hours”. There is a docket in Exhibit 56, but that claims only two men. Exhibit 83 makes no reference to any work being carried out by the plaintiff that day. Given the inconsistency, and my doubt about the justification for this claim, I will not allow it.

[162]
There was then a claim for hand watering on the site on the following three days: Exhibit 24. That there were people on the site on 19, 20 and 21 September watering crushed rock, presumably prior to the bitumen seal, was acknowledged in the docket in Exhibit 27, but this does not obviously relate to the fact that the work was done then rather than at an earlier time.

[163]
Apart from this, there is the mobilisation cost. The defendant’s submissions took relatively little issue with the claims in Exhibit 24, except that it was said that the rate of $60 per hour should have been $55 per hour, which seems right, and that claiming 10 hours each for the men for the day on which they had their medical examinations was excessive because the medical examinations would not have taken so long. No doubt that is true, but for practical purposes before the men work on the site they had to undergo the induction course and they had to have medical examinations, so the day on which the medical examinations occurred was effectively time when nothing else useful could be done, and there is no reason why the defendant should not pay for that time. Mr Speziali’s rate for travelling was $70 per hour in Exhibit 16, but I think it reasonable that the total travel allowance be only $250, and I will not allow five weeks for the cost of keeping a flat empty for him. Making those adjustments to the mobilisation claim, I allow $12,800. The demobilisation amount of $5,310 conceded by the defendant strikes me as reasonable; I allow that.

[164]
Overall therefore the amount allowed in respect of the pavement timing claim is $71,515. The other aspect of this matter is that a claim was also made in relation to the delay in the construction of the spoon drains. These were constructed after the road base was laid, but I can think of no reason why it would have been any more difficult, expensive or time consuming to construct them then rather than at the time when the other civil work was done under the contract, and the plaintiff led no evidence to establish any particular increase in the costs in relation to this matter. This claim is therefore disallowed in total.

Conclusion

[165]
In summary therefore the amounts I allow for the claims that have succeeded are:

(a)
Lean mix concrete claim$104,851.25

(b)
Slab thickening claim$107,280.80

(d)
Pavement timing claim$71,515

(e)
TOTAL$320,520.65

[166]
This amount however is before GST, which must be added to produce an amount payable of $352,572.71. The plaintiff is entitled to interest under clause 42.9 of the general conditions, at the rate of 4% per annum specified in the contract schedule. By that clause interest compounds at six monthly intervals. The whole amount was owing at the latest 35 days after the plaintiff’s final payment claim, which was made on 21 November 2008: Exhibit 3, so interest runs from 27 December 2008. I calculate the interest to the date of judgment as $148,093.35. So I give judgment that the defendant pay the plaintiff $500,666.06, including $148,093.35 by way of interest.

Footnotes

[1]Exhibit 5; Kamali p 32. He added the handwritten notes when comparing it with later versions: p 38.

[2]Speziali p 3-8; p 3-47; Kamali p 2-21.

[3]The defendant had it in late 2006 (Leong p 4-61); at least by 15 January 2007: Evans p 5-38.

[4]Leong p 4-63.

[5]Herriot: p 3-64, p 3-67. Also Kamali p 34-36. Mr Speziali referred to them as “blade piers”: p 2-60.

[6]See Exhibit 14, Drawing CO241-CF-002-C; Kamali p 34.

[7]Type A footing 350 wide x 600 deep; type B footing 450 wide x 675 deep.

[8]As shown in photo 17 in Exhibit 63: form work set up to pour the slab and footings on top of the trench piers, then in place.

[9]He came close to conceding this under cross-examination; p 4-96.

[10]This was confirmed by telephone: Kamali p 40.

[11]The email said a copy of the standard form contract AS 2545-1993 parts A and B were attached, but they were not included in Exhibit 9, the document produced in evidence; the defendant at one stage also produced a copy of this email with the same attachments as in Exhibit 9, without parts A and B.

[12]Sic. It was as if the author was deliberately avoiding stating exactly what work was to be done.

[13]Though only the first two were also listed in Clause 11.7 on p 14.

[14]The scope of work specification in Exhibit 9 required the contractor to provide detailed design and working drawings: clause 4.0.

[15]Evans p 4-103.

[16]Speziali p 2-80, p 2-81, p 3-8: 2m to reach original ground level.

[17]Evans p 5-39; p 5-47-8.

[18]Evans p 4-58. He agreed he would have communicated with the tenderers, and it was likely he discussed with the plaintiff lowering their tender: p 5-36. Exhibit 74 suggests some contact.

[19]Evans was under pressure to get the tender prices lower: p 5-36, 45. The plaintiff’s price was well above the defendant’s estimate: Exhibit 71.

[20]Evans p 5-8.

[21]Herriot p 3-65.

[22]Drawing C0241-CF-006 para F1 in Exhibit 10.

[23]“Natural ground” is omitted from table 2 on page 4 of Exhibit 1; it is possible that an expert could work this out from the material provided in Exhibit 1, but neither party called evidence of this.

[24]Herriot p 3-71 referred to on the drawings as “original ground surface”, but the site had been previously filled, and the original ground surface was the “natural ground level.”

[25]Herriot p 3-66.

[26]Exhibit 14 Drawing CO241–CF–002-C. Measured from under B beams: Herriot p 3-65.

[27]The ground around the engine footings was to slope gently outwards towards two spoon drains on the sides of the lines of slabs, with a peak of RL 47.1 in the middle between the drains: CO241-CF-001. This would have been the top of the “chip seal” around the footings. See Herriot p 3-71.

[28]Speziali p 3-18. See also cross-examination at p 4-15, where he became vague about this.

[29]Kamali p 92, presumably hearsay. He may have adopted this figure out of caution.

[30]The levels before the placing of road base and chip seal would have been lower by their thickness.

[31]RL 47.15, from Section A on drawing CO241-CF-002-D (Exhibit 14). As constructed the slabs had top levels of RL 47-151 to RL 47-165, (Exhibit 82 surveyed 3.5.07) which is close to this figure.

[32]Kamali p 93, 94.

[33]Herriot p 3-71.

[34]The location of the test pits was shown in Exhibit 1 only approximately: Exhibit 1, p 2 #5.1.

[35]Herriot p 3- 65.

[36]Drawing CO241-CF-002-C.

[37]Except for the trench pier under the sideways extension of the slab, where the type B footing was 100 mm lower, and it would be RL 46.175.

[38]The trench itself would be deeper since the top of the trench pier was to be about 400 mm below the “after earthworks” surface, but this should not affect the amount of concrete required for the trench piers, as this extra depth would be occupied by the type B footings.

[39]Except that test pit 6 lies between two trench piers.

[40]I have assumed that the adjustment in Exhibit 12 had been made.

[41]The relevant Australian Standard Subcontract Conditions provide for variations in clause 4.0, including for latent conditions: clause 12.3.

[42]Mr Evans had done this as well with another project: Exhibit 73; Evans p 5-51.

[43]Kamali p 2-50; Speziali p 2-72: 3.3 m. This would be consistent with the content of the “important note” on drawing CO241-CF-006 in Exhibit 10, that there was up to 3.6 m of “uncontrolled filling” on the site.

[44]$241,850 in Exhibit 11 to $167,548 in Exhibit 16, roughly the equivalent of reducing the assumed depth of the piers from 3m to 2m.

[45]Exhibit 30 (6 March 2007); Exhibit 31 (1 April 2007); Exhibit 52, note on drawing CO241-CF-002.

[46]Speziali p 2-84; Kamali p 59-61.

[47]In fact almost all of it.

[48]It remained throughout: Evans p 4-55.

[49]The total assumed 1 gas filter slab was required.

[50]It was not suggested that any of these qualifications affected directly the matters in issue. The defendant responded that day (Exhibit 37) taking issue with some of the points raised but the plaintiff did not reply before the tender was accepted.

[51](1954) 91 CLR 353.

[52]Commercial Bank of Australia Ltd v GH Dean & Co Pty Ltd [1983] 2 Qd R 204 at 209; South Coast Oils (Qld and NSW) Pty Ltd v Look Enterprises Pty Ltd [1988] 1 Qd R 680 at 699; Wharf St Pty Ltd v Amstar Learning Pty Ltd [2004] QCA 256; Mermaids Café and Bar Pty Ltd v Elsafty Enterprises Pty Ltd [2010] QCA 271 at [12]-[17].

[53]Note the defendant’s assertion in Exhibit 54 that the formal contract could not contain anything not in the documents at the time the “work order” was issued, consistent only with a contract already in existence.

[54]Unless the “tender clarification” is Exhibit 17.

[55]In fact work began on 9 February 2007 with procedural steps; actual earthmoving began on 15 February 2007: Exhibit 60.

[56]Curiously, Exhibit 19 referred to requests for quotation in Exhibit 9 and dated 3 January (not in evidence), but not the one in Exhibit 13, and revision 1 of the specification rather than revision 2 in Exhibit 13. These must have been mistakes, as the Exhibit 13 versions were ultimately included in Exhibit 52, and are another example of sloppy documentation by the defendant.

[57]Kamali p 2-15, 16; Speziali p 2-88.

[58]Disregarding Mr Evans’ incorrect assertion on p 4–69, which involves a mistiming of the signing of the contract.

[59]See King Tide Co Pty Ltd v Arawak Holdings Pty Ltd [2017] QCA 251, particularly at [13] – [15], [41](a).

[60]Evans Deakin Industries Ltd v Queensland Electricity Generating Board (1985) 1 BCL 334 at 342 per McPherson J, with whom Campbell CJ agreed. See also Cavallari v Premier Refrigeration Co Pty Ltd (1952) 85 CLR 20 at 29 per Webb J.

[61]Examples include R A Brierley Investments Ltd v Landmark Corporation Ltd (1966) 120 CLR 224; Quadling v Robinson (1976) 137 CLR 192, esp at 201, concerning the exercise of an option; Turner Kempson & Co Pty Ltd v Camm [1922] VLR 498; Costello v Loulakas [1938] St R Qd 267; Howes v Miller [1970] VR 522 at 527 (purported acceptance of settlement offer enclosing a release to be signed and returned a counter-offer), followed in Brewer v Fichera (1991) 12 Qld Lawyer Reps 98 per McMurdo DCJ; Goodman Fielder Consumer Foods Ltd v Cospack International Pty Ltd [2004] NSWSC 704 at [45] per Macready M; to which may now be added King Tide Co Pty Ltd v Arawak Holdings Pty Ltd [2017] QCA 251.

[62]This became a term of the contract, as pleaded in Statement of Claim, para 14.

[63]Only administrative work such as site inductions were done until 15 February, when actual earthmoving started: Exhibit 60; Speziali p 4-16.

[64]Evans p 4-90.

[65]Exhibit 3; Gouldson p 16.

[66]Relying inter alia on Daysea Pty Ltd v Watpac Australia Pty Ltd [2001] QCA 49.

[67]Plaintiff’s submissions in writing para 159.

[68]Clause 42.8 made a final certificate “evidence” in any proceedings, but not “constructive evidence”. See Martinek Holdings Pty Ltd v Reed Construction Qld Pty Ltd [2009] QCA 329 at [18].

[69]He had not kept any significant contemporaneous notes of what happened: Evans p 5-3; Exhibit 68, which shows he was at the time also involved with other projects of the defendant.

[70]Evans p 4-69, line 36.

[71]Evans p 5-52, lines 11, 12.

[72]As noted above, the list contained its own errors.

[73]Evans p 4-71, lines 4-8. There was between that question and answer a long pause while Mr Evans examined the document, something not obvious from the transcript.

[74]See for example p 4-84, lines 10-23; and see p 5-9 where he was given a clear request to calculate an average depth to natural ground in the test pits and calculated something quite different, and meaningless.

[75]See for example, at p 5-20, that Exhibit 13 omitted some items from the scope of works. That there were changes in the final request for quotation was obvious.

[76]If he really did not know the answer to that question, he should have said so, though it is difficult to believe that if at the time he had not known what the item in question related to, he would not have asked the plaintiff.

[77]Exhibit 80: $43,718, Exhibit 40: $26,500. This is despite the fact that the volumes of lean mix and 32MPA concrete in Exhibit 80 are less that the totals of the amounts in Exhibit 40, due I expect to faulty addition by Mr Evans.

[78]He had earlier said that this figure related to the A and B footings (p 2-69) which is clearly wrong.

[79]3m x .45m x 2m x 6 x 11 = 178.2.

[80]Exhibit 49; Stevens p 6-101, 102.

[81]Speziali p 3-11-13. See also Exhibit 31.

[82]Stevens p 6-7; p 6-30; p 6-53.

[83]Particularly those in Exhibit 63.

[84]The submissions for the plaintiff did not explain why that figure was wrong, but adopted a figure of 24 m3, which is the total of most but not all references in Exhibit 41 to lean mix concrete.

[85]Thiess Services Pty Ltd v Mirvac Qld Pty Ltd [2006] QCA 50 at [34], [54].

[86]Dillingham Constructions Pty Ltd v Downs [1972] 2 NSWLR 49.

[87]A point left open in Morrison-Knudsen International Co Inc v The Commonwealth (1972) 46 ALJR 265.

[88]That is consistent with the impression Mr Evans made on me in the witness box. He said it was not usual, not industry procedure, to provide such a report to a subcontractor: p 5-18, 19.

[89]Mr Stevens said he photographed trenches with services but did not say that he only photographed such trenches.

[90]The rate covers the “installation” of the concrete, here the excavation, as well as the supply.

[91]11 pads x 6 trench piers per pad x 3m x 0.45m x 2m.

[92]Trade Practices Act s 51A.

[93]This document was dated 18 October 2005, but that must be a mistake, since in refers to the price the plaintiff quoted on 23 January 2007.

[94]Evans p 5-78: there were two final tenderers, and lots of positive factors about the plaintiff. These prices were said to be very close together: p 5-79. But see Evans p 5-45: Leong said to him the tender prices were too high, p 5-45.

[95]Evans p 4-98.

[96]At one point Stevens denied the whole site had been lowered (p 6-71) but later he appeared to agree that the area with the generator slabs had been lowered (p 7-7) or could have been: p 7-8. The true position was that he recalled that there was an issue with the levels but did not recall how it was resolved: p 6-9.

[97]Speziali p 4-16, 7.

[98]Exhibit 82; this was not checked: Makkai p 6-18.

[99]Note general instruction 03 on drawing CO241-CF-006.

[100]Drawing CO241-CEW-002 is inconsistent with CO241-CF-002, with the former showing the entire road base under the concrete slab, which would have produced a step up from the pavement to the concrete slab of almost 200 millimetres, not at all what the latter shows.

[101]Particularly photos in Exhibit 62, some of which suggest a height of over 300 mm.

[102]Exhibit 63 photo 17; Speziali p 4-21. Photos in Exhibit 62 show it well above the surface in places. Stevens said it was 210mm wide: p 7-37.

[103]Exhibit 101, 102. .

[104]Equuscorp Pty Ltd v Glengallan Investments Pty Ltd [2002] QCA 380.

[105]Evans p 4-90.

[106]Described on the drawing as a 100mm x 100mm fillet.

[107]This is supported by CO241-CEW-002. As well, Mr Stevens said in his experience on other projects, the crushed rock layer was put down before things like foundations for the enclosure slabs were dug.

[108]Though the photographs show there was some: Exhibit 63, photo 17.

[109]14.6m x 4.1m + 3.2m x 4.2m: from drawing CO241-CF-002.

[110]This was based on information from the site, not a calculation from the drawings: Kamali p 93, 94. Contrast the service support tree slabs claim calculation: Kamali p 95.

[111]99.59 millimetres.

[112]It did not in fact include any allowance for this work: Kamali p 61. For his reasons see p 45, 48.

[113]The position would have been no different had the formal contract been entered into in the form of Exhibit 52, because the documentation in that is defective in the same way.

[114]Speziali p 2-85; Evans p 5-53. He did not justify his bold assertion (p 5-54) that the work was included in the contract.

[115]Australian Broadcasting Commission v Australasian Performing Right Association Pty Ltd (1973) 129 CLR 99 at 109; Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at [51].

[116]I am not limited to the amount claimed by the plaintiff: AAI Ltd v Marinkovic [2017] QCA 54 at 105.

[117]The defendant also made a claim on its principal, for much more than this, and I assume pocketed any difference: Exhibit 80.

[118]All except a small part of the site in the north-east corner was to be sealed in this way: drawing CO241-CEW-001. It was to be done after all other work on the site: Kamali p 66.

[119]Evans p 5-55; Stevens p 6-60, 63; Exhibit 21. One photo in Exhibit 63 shows the site with a large number of trenches, which were presumably from laying the earth grid. It is obvious to me that it would be stupid to lay the road base before something like this was done.

[120]Speziali p 3-26; Stevens p 6-62, who claimed the change was agreed on site. He was told there would be extra costs: p 3-27; but see Stevens p 6-10. I reject Stevens’ version since there would at the least have been an extra for another mobilisation at the site: p 6-75; Exhibit 99.

[121]Evans p 4-85: He had no problems with the change to programme so long as there were no costs to the defendant.

[122]See Speziali p 3-26, which suggests a conversation after March 2007. Mr Stevens was also vague about what was said and when: p 6-10.

[123]These minutes were prepared by Mr Stevens. It was not suggested that they were shown to and agreed by Mr Speziali, and are probably better described as Mr Stevens’ “to do” list arising from the weekly site meetings.

[124]Mr Speziali said he had an agreement with Evans as well to this effect: p 3-34.

[125]Speziali p 3-36; Stevens conceded there was some interference, but claimed to have minimised it: p 6-68.

[126]This was a reference to the other subcontractor working on the site.

[127]Evans conceded as much under cross-examination: p 5-58.

[128]Defendant’s outline paras 74, 79, 87.

[129]In fact the defendant has paid nothing in relation to this claim, not even the trivial amount that it admits is payable.

[130]See also Speziali p 3-35, lines 44-45.

[131]Kamali p 79.

[132]There is in fact, no amount for this set out in the annexure, with the result that the allowance is to include “a reasonable charge”.

[133]I gather this was advanced on the basis that this was a much smaller roller than would otherwise have been used.

[134]Submissions in writing, para 79.

[135]Stevens p 6-66; S Speziali p 22, p 29; and see Exhibit 4, Exhibit 55.

[136]Evans p 5-58.

[137]He claimed this took about 2 hours: Stevens p 7-21, a long time for a site of about 1.25 hectares:.

[138]Exhibit 60, but there are entries evidence only for 3 and 4 September.

[139]Most of these were signed by Mr Stevens.

[140]See Exhibit 4.

[141]Another version of this, covering an overlapping period, was Exhibit 105.

[142]Though not impossible: Exhibit 25.

[143]These were working under a separate contract, doing different work. The Dalby crew worked only on the subcontract work, but on occasions Mt Isa employees helped out with the road base work: S Speziali p 22.

[144]Speziali p 3-35.

[145]The “earthworks” figure in the second tender incorporated this, and item 3 in Exhibit 11, for a price which was the total of those two prices.

[146]Kamali p 2-46. “Catch up” time is an allowance built into one section of work at the end of the job to reduce the risk of the overall job running over if there are delays in parts of it, rather like a railway timetable.

[147]See Exhibit 34, where Mr Stevens referred to work of this nature being done, for which he says he will sign timesheets, though no allowance for this was made in the civil log or the defendant’s submissions.

[148]In Exhibit 27, on 11 and 12 September; in Exhibit 56, both in Docket 51563 dated 11 September 2007.

[149]Also in Docket 51563 in Exhibit 56, and Docket 51165 in Exhibit 27.

[150]Docket 51164 in Exhibit 27; also in Docket 51563 in Exhibit 56. See also Exhibit 24.

Editorial Notes

Published Case Name:
Nortask Pty Ltd v Clarke Energy (Australia) Pty Ltd
Shortened Case Name:
Nortask Pty Ltd v Clarke Energy (Australia) Pty Ltd
MNC:
[2017] QDC 268
Court:
QDC
Judge(s):
McGill DCJ
Date:
03 Nov 2017

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited List of Cases Cited by this judgment

Case Name	Full Citation	Frequency
AAI Ltd v Marinkovic	[2017] 2 Qd R 672; [2017] QCA 54	2 citations Jump To Cite 1 - [2017] QCA 54 Cite 2 - [2017] QCA 54
Australian Broadcasting Commission v Australasian Performing Right Association Ltd	View on:JADE(1973) 129 CLR 99	2 citations Jump To Cite 1 - (1973) 129 CLR 99 Cite 2 - (1973) 129 CLR 99
Brewer v Fichera	(1991) 12 Qld Lawyer Reps 98	1 citation Jump To Cite 1 - (1991) 12 Qld Lawyer Reps 98
Cavallari v Premier Refrigeration Co Pty Ltd	View on:JADE(1952) 85 CLR 20	1 citation Jump To Cite 1 - (1952) 85 CLR 20
Commercial Bank of Australia Ltd v G H Dean & Co Pty Ltd	[1983] 2 Qd R 204	2 citations Jump To Cite 1 - [1983] 2 Qd R 204 Cite 2 - [1983] 2 Qd R 204
Costello v Loulakas	[1938] St R Qd 267	1 citation Jump To Cite 1 - [1938] St R Qd 267
Davies v Smith	(1938) 12 ALJ 260	1 citation Jump To Cite 1 - (1938) 12 ALJ 260
Daysea P/L v Watpac Aust P/L	[2001] QCA 49	2 citations Jump To Cite 1 - [2001] QCA 49 Cite 2 - [2001] QCA 49
Dillingham Constructions Pty Ltd v Downs	View on:NSWLR[1972] 2 NSWLR 49	2 citations Jump To Cite 1 - [1972] 2 NSWLR 49 Cite 2 - [1972] 2 NSWLR 49
Equuscorp Pty Ltd v Glengallan Investments Pty Ltd	[2002] QCA 380	2 citations Jump To Cite 1 - [2002] QCA 380 Cite 2 - [2002] QCA 380
Ermogenous v Greek Orthodox Community of SA Ltd	View on:JADE(2002) 209 CLR 95	2 citations Jump To Cite 1 - (2002) 209 CLR 95 Cite 2 - (2002) 209 CLR 95
Evans Deakin Industries Ltd v The Queensland Electricity Generating Board	(1985) 1 BCL 334	1 citation Jump To Cite 1 - (1985) 1 BCL 334
Goodman Fielder Consumer Foods Ltd v Cospack International Pty Ltd	View on:JADE[2004] NSWSC 704	1 citation Jump To Cite 1 - [2004] NSWSC 704
Howes v Miller	View on:VR(1970) VR 522	1 citation Jump To Cite 1 - (1970) VR 522
King Tide Company Pty Ltd v Arawak Holdings Pty Ltd	[2017] QCA 251	3 citations Jump To Cite 1 - [2017] QCA 251 Cite 2 - [2017] QCA 251 Cite 3 - [2017] QCA 251
M J Arthurs Pty Ltd v Isenbert	[2017] QDC 85	2 citations Jump To Cite 1 - [2017] QDC 85 Cite 2 - [2017] QDC 85
Martinek Holdings Pty Ltd v Reed Construction (Qld) Pty Ltd	[2009] QCA 329	2 citations Jump To Cite 1 - [2009] QCA 329 Cite 2 - [2009] QCA 329
Masters v Cameron	View on:JADE(1954) 91 C.L.R 353	3 citations Jump To Cite 1 - (1954) 91 C.L.R 353 Cite 2 - (1954) 91 C.L.R 353 Cite 3 - (1954) 91 C.L.R 353
Mermaids Cafe & Bar Pty Ltd v Elsafty Enterprises Pty Ltd	[2010] QCA 271	2 citations Jump To Cite 1 - [2010] QCA 271 Cite 2 - [2010] QCA 271
Morrison-Knudsen International Company Inc. v Commonwealth	(1972) 46 ALJR 265	2 citations Jump To Cite 1 - (1972) 46 ALJR 265 Cite 2 - (1972) 46 ALJR 265
Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd	View on:JADE(2015) 256 CLR 104	2 citations Jump To Cite 1 - (2015) 256 CLR 104 Cite 2 - (2015) 256 CLR 104
Pavlovic v Universal Music Australia Pty Ltd	View on:NSWLR(2015) 90 NSWLR 605	2 citations Jump To Cite 1 - (2015) 90 NSWLR 605 Cite 2 - (2015) 90 NSWLR 605
Quadling v Robinson	View on:JADE(1976) 137 CLR 192	1 citation Jump To Cite 1 - (1976) 137 CLR 192
R A Brierley Investments Ltd v Landmark Corporation Ltd	View on:JADE(1966) 120 CLR 224	1 citation Jump To Cite 1 - (1966) 120 CLR 224
South Coast Oils (Qld & NSW) Pty Ltd v Look Enterprises Pty Ltd	[1988] 1 Qd R 680; [1986] QSC 443	2 citations Jump To Cite 1 - [1988] 1 Qd R 680 Cite 2 - [1988] 1 Qd R 680
South Coast Oils Pty. Ltd. v Look Enterprises Pty. Ltd.	[1988] 1 Qd R 680; [1987] QSCFC 90	2 citations Jump To Cite 1 - [1988] 1 Qd R 680 Cite 2 - [1988] 1 Qd R 680
Thiess Services Pty Ltd v Mirvac Queensland Pty Ltd	[2006] QCA 50	2 citations Jump To Cite 1 - [2006] QCA 50 Cite 2 - [2006] QCA 50
Turner Kempson & Co Pty Ltd v Camm	View on:VR[1922] VLR 498	1 citation Jump To Cite 1 - [1922] VLR 498
Wharf St Pty Ltd v Amstar Learning Pty Ltd	[2004] QCA 256	2 citations Jump To Cite 1 - [2004] QCA 256 Cite 2 - [2004] QCA 256

Cases Citing List of cases on Queensland Judgments citing this Judgment

Case Name	Full Citation	Frequency
Nortask Pty Ltd v Clarke Energy (Australia) Pty Ltd (No 3)	[2018] QDC 33	2 citations

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Nortask Pty Ltd v Clarke Energy (Australia) Pty Ltd[2017] QDC 268