Queensland Judgments
Authorised Reports & Unreported Judgments
  • sclq logo
  1. Caselaw
  2. QSC
  3. 2024
  4. Tomkins Commercial & Industrial Builders Pty Ltd v Pacific Diamond 88 Pty Ltd - [2024] QSC 321

Authorised Reports & Unreported Judgments
Exit Distraction Free Reading Mode
  •  Notable Unreported Decision
  • Appeal Determined (QCA)

Tomkins Commercial & Industrial Builders Pty Ltd v Pacific Diamond 88 Pty Ltd[2024] QSC 321

Tomkins Commercial & Industrial Builders Pty Ltd v Pacific Diamond 88 Pty Ltd[2024] QSC 321

SUPREME COURT OF QUEENSLAND

CITATION:

Tomkins Commercial & Industrial Builders Pty Ltd v Pacific Diamond 88 Pty Ltd as trustee for the Pacific Diamond 88 Unit Trust [2024] QSC 321

PARTIES:

TOMKINS COMMERCIAL & INDUSTRIAL BUILDERS PTY LTD ABN 98 061 732 778

(applicant)

v

PACIFIC DIAMOND 88 PTY LTD AS TRUSTEE FOR THE PACIFIC DIAMOND 88 UNIT TRUST

ABN 28 583 823 057

(respondent)

FILE NO/S:

BS 13947/24

DIVISION:

Trial Division

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court of Queensland at Brisbane

DELIVERED ON:

20 December 2024

DELIVERED AT:

Brisbane

HEARING DATE:

25 November 2024

JUDGE:

Treston J

ORDER:

  1. Under the contract between the applicant and the respondent dated 22 December 2021, as varied, (the Contract) the Principal does not have a right to elect to set off against moneys due from the Principal to the Contractor certified in a progress certificate pursuant to clause 37.2(a) of the General Conditions of Contract any liquidated damages certified under clause 34.7 of the General Conditions of Contract.
  2. The Principal does not have any right of recourse to the Security given under the Contract in respect of any amount or amounts purportedly certified by the Superintendent as payable from the applicant to the respondent in:
    1. Liquidated Damages Certificate No. 05 issued on 2 October 2024; and
    2. Payment Certificate No. 32 on 2 October 2024.
  3. The following notices given by the Respondent to the Applicant dated 11 October 2024 are invalid and of no effect:
    1. The notice given by the Respondent of the Respondent’s intention to have recourse to Security under General Condition 5.2 of the Contract; and
    2. The notice given by the Respondent purportedly under section 67J of the Queensland Building and Construction Commission Act 1991 (Qld).
  4. A declaration that $694,343.00 is payable by the Respondent to the Applicant within 15 business days after 25 September 2024 as the balance of the progress certificate constituted by Payment Certificate No. 32 issued on 2 October 2024.
  5. An order for payment by the Respondent to the Applicant of:
    1. $694,343.00; and
    2. Interest pursuant to s 58 of the Civil Proceedings Act 2011 (Qld) or pursuant to clause 37.5 of the Contract at the rate of 10% or such other rate as the court considers appropriate on the amount in (a) calculated from 18 October 2024 until the date of judgment.
  6. The respondent is to pay the applicant’s costs of the application on the standard basis.

CATCHWORDS:

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – THE CONTRACT – CONSTRUCTION OF PARTICULAR CONTRACTS AND IMPLIED CONDITIONS – SECURITY AND RETENTION FUNDS – where the applicant and the respondent are parties to a building contract – where the respondent issued two certificates to the applicant, a liquidated damages certificate and a payment certificate – where the combined effect of the two certificates was that the respondent sought to set off a liquidated damages claim against payment which was otherwise due to the applicant – where the respondent thereafter gave the applicant notice of intention to have recourse to bank guarantees provided as security under the contract – where the applicant applies for declarations that the respondent is not entitled to “set off” in the matter which it has and alternatively an injunction to the same effect – whether, pursuant to a construction of the terms of the contract, the respondent has a right to elect to set off certified liquidated damages against money it owes to the applicant in the form of a progress certificate – whether an injunction to the same effect ought to be granted

Civil Proceedings Act 2011 (Qld) s 58

Queensland Building and Construction Commission Act 1991 (Qld) s 67J

A Goninan & Co Ltd v Direct Engineering Services Pty Ltd (No 2) [2008] WASCA 112, cited

Austrak Pty Ltd v John Holland Pty Ltd [2006] QSC 103, cited

Barclay Mowlem Construction Ltd v Simon Engineering (Australia) Pty Ltd (1991) 23 NSWLR 451, cited

Clough Engineering Ltd v Oil & Natural Gas Corporation Ltd (2008) 249 ALR 458, cited

Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337, cited

Ecosse Property Holding Pty Ltd v Gee Dee Nominees Pty Ltd (2017) 261 CLR 544, cited

Electricity Generation Corporation t/as Verve Energy v Woodside Energy Ltd (2014) 251 CLR 640, cited

Fletcher Construction Australia Ltd v Varnsdorf Pty Ltd [1998] 3 VR 812, cited

Louis Dreyfus & Cie v Parnaso Cia Naviera SA [1959] 1 QB 498, cited

Merritt Cairns Constructions Pty Ltd v Wulguru Heights Pty Ltd [1995] 2 Qd R 521, cited

Monadelphous Engineering Pty Ltd & Anor v Wiggins Island Coal Export Terminal Pty Ltd [2014] QCA 330, cited

Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104, cited

Postle v Sengstock [1994] 2 Qd R 290, cited

Redline Contracting Pty Ltd v MCC Mining (Western Australia) Pty Ltd [2011] FCA 1337, cited

Saipem Australia Pty Ltd v GLNG Operations Pty Ltd (No 2) [2016] 1 Qd R 254, cited

Sugar Australia Pty Ltd v Lend Lease Services Pty Ltd [2015] VSCA 98, cited

Wood Hall Ltd v The Pipeline Authority (1979) 141 CLR 443, cited

COUNSEL:

DS Piggott KC with JE Menzies for the applicant

D Keane KC with M Ziebell for the respondent

SOLICITORS:

Thomson Geer for the applicant

Mills Oakley for the respondent

  1. [1]
    Tomkins and Pacific Diamond are parties to a building contract. Tomkins is the builder and Pacific Diamond is the Principal.
  2. [2]
    The applicant, Tomkins, seeks a number of declarations arising under the contract dated 22 December 2021 (as varied by deed of variation dated 15 August 2022).  The dispute arises primarily in the context of certifications made by the Superintendent under the contract. 
  3. [3]
    On 2 October 2024, the Principal gave Tomkins two certificates.
  4. [4]
    The first is Certificate No. 5, which the Superintendent certified as due and payable by Tomkins to the Principal liquidated damages of $2.6 million. On its face, the Liquidated Damages Certificate states that the Principal “may elect to set off” that amount from the amount certified in the Payment Certificate to which it was attached.
  5. [5]
    The second is Payment Certificate No. 32, which was for a certified amount of $694,343.00. The Principal stated in Certificate No. 32 that it had “elected to apply the liquidated damages pursuant to clause 34.7 of the contract”. Certificate No. 32 went on to state that “pursuant to clause 37.2” the Principal certified that a payment of $1,905,657.00 was due from the Contractor to the Principal.
  6. [6]
    The combined effect of the two certificates was that the Principal was seeking to set off the liquidated damages claim against the payment which was otherwise due to Tomkins (there being no dispute that the $694,343.00 was otherwise owing), leading to a net sum payable by Tomkins to the Principal of $1,905,657.00.
  7. [7]
    On 11 October 2024, the Principal gave Tomkins notice of intention to have recourse to bank guarantees provided as security under the contract to recover the net amount of $1,905,657 as certified by the Superintendent. 
  8. [8]
    Tomkins seeks declarations that the Principal is not contractually entitled to set off in the manner which it has. This involves an examination of the contract as a whole, but particularly clauses 34.7 and 37.2. In the alternative to the declarations, Tomkins seeks an injunction to restrain the Principal from having recourse to those guarantees.
  9. [9]
    The matter came on urgently in applications court on 18 October 2024 and consent orders were made which record undertakings preserving the status quo until the final determination of the matters in the dispute in the proceeding, or earlier order.
  10. [10]
    At the heart of the matter is a question about the construction of the terms of the contract, and specifically whether the Principal has a right to elect to set off certified liquidated damages against money due from the Principal to the Contractor certified in a progress certificate.

Relevant principles of contractual interpretation

  1. [11]
    Both parties agree that the relevant principles to the interpretation of the contract (including as varied by the deed of variation) are as follows.
  2. [12]
    The objective meaning of the contract is to be determined by what a reasonable businessperson would have understood those terms to mean, in view of the language used, the surrounding circumstances known to the parties, and the commercial purpose of the contract.[1]
  3. [13]
    The court’s task is to ascertain not what the parties intended to say or achieve, nor what the parties thought was meant, but the meaning of the contract as conveyed to a reasonable person.[2]
  4. [14]
    The court must ascertain the intention of the parties as expressed in the words that they have used.  Where those words are ambiguous or susceptible of more than one meaning, evidence of prior negotiations is admissible to establish the background facts that were known to both parties and the subject matter of the contract.  However, statements of the parties’ subjective intentions and expectations are not admissible.  Such statements reveal no more than the terms of the contract that the parties hoped to make; they are superseded by and merged in the contract itself.[3]
  5. [15]
    This is a case of deletion within the terms of a standard form contract: the agreed General Conditions of the contract state that they were amended from AS 4902-2000.  Deleted words in a standard form contract can be referred to as an aid to the meaning of ambiguous words in a term which remains.[4]  The court first looks at the relevant clause in its actual form without the deleted words.  If the clause is found to be ambiguous, the court then looks at the deleted words to derive any assistance in resolving the ambiguity.[5]

Clause 37

  1. [16]
    I turn to look first therefore at the relevant clause in its actual form without reference to any of the deleted words.
  2. [17]
    Clause 37, in the form that was signed by the parties, is a clause which appears under the heading “Payment”. Clause 37.1 deals with progress claims.  The terms of it are not in issue.  The clause that falls to be construed is clause 37.2 which provides:

“37.2 Certificates

The Superintendent shall, within 10 business days after receiving such a progress claim, issue to the Principal and the Contractor:

  1. a progress certificate evidencing the Superintendent’s opinion of the moneys due from the Principal to the Contractor pursuant to the progress claim and reasons for any difference (‘progress certificate’)

If the Contractor does not make a progress claim in accordance with Item 33, the Superintendent may issue the progress certificate with details of the calculations and shall issue the certificate in paragraph (b).

Subject to clause 7.3, the Superintendent in receiving a progress claim does so as agent of the Principal for the purposes of the BIF Act.

If the Superintendent does not issue the progress certificate within 10 business days of receiving a progress claim in accordance with subclause 37.1, that progress claim shall be deemed to be the relevant progress certificate.

The Principal shall within 15 business days after the Superintendent receives the progress claim, pay to the Contractor the balance of the progress certificate after setting off such of the certificate in paragraph (b) as the Principal elects to set off.  If that setting off produces a negative balance, the Contractor shall pay that balance to the Principal within 5 business days of receiving written notice thereof. 

Neither a progress certificate nor a payment of moneys shall be evidence that the subject WUC has been carried out satisfactorily.  Payment other than final payment shall be payment on account only.”

  1. [18]
    Clause 37.2 has the heading “Certificates”, which is plural, but only one such certificate is identified at (a), that is, a progress certificate.  That certificate is one which evidences the Superintendent’s opinion of the moneys due from the Principal to the Contractor pursuant to a progress claim.  If, however, the Contractor does not make a progress claim then the Superintendent “…shall issue the certificate in paragraph (b)”.  There is in fact no clause 37.2(b).  It is not immediately obvious therefore from the terms of the clause what the certificate is that the Superintendent is to issue pursuant to clause 37.2(b).
  2. [19]
    Next, the second last paragraph in clause 37.2 provides a procedure for the Principal to pay to the Contractor the balance of the progress certificate “after setting off such of the certificate in paragraph (b) as the Principal elects to set off”.  Again, because there is no sub-paragraph (b) it is not clear what the certificate is which is to be set off. 
  3. [20]
    That same paragraph of clause 37.2 goes further to identify that if “that setting off” produces a negative balance, then the Contractor shall pay that balance to the Principal within five business days of receiving written notice thereof.  Those words, specifically “setting off” and “negative balance” suggest that the missing sub-paragraph (b) might well have pertained to moneys due from the Contractor to the Principal, rather than from the Principal to the Contractor as provided for in sub-paragraph (a), but other than that inference, the further provisions do not assist in identifying what the subject matter of sub-paragraph (b) might have contained.
  4. [21]
    I accept that clause 37.2 cannot be read in the abstract.  The clause must be construed in the context of the contract as a whole.
  5. [22]
    The Principal contends that it has a right to set off (as exists under clause 37.2) which arises elsewhere in the contract, and otherwise in equity, and clause 37 must be read in that context.
  6. [23]
    First, the Principal submits that the objective meaning of the contract is informed by clause 5.2 of the contract (as signed) being:

“After first having given 5 business days’ notice of its intention to do so to the Contractor, and subject to having satisfied the requirements of section 67J of the QBCC Act (where applicable), the Principal may have recourse to the security if:

  1. an amount is payable by the Contractor to the Principal and the due date for payment of that amount has passed; or
  1. the Principal is entitled to terminate the contract or take work out of the hands of the Contractor for any reason (including, without limitation, pursuant to clause 39.4 or clause 39.11).

The obligation in the preceding paragraph to give the Contractor 5 business days’ notice of the Principal’s intention to have recourse to the security does not apply if the Contractor is subject to an event listed in clause 39.11.” (my underlining)

  1. [24]
    The Principal therefore submits that the right to set off such amounts as the Contractor may owe to the Principal preserves the Principal’s right of set off, as that term is used in clause 37.2 and entitles the Principal to have immediate recourse to the security upon giving five days’ notice of intention to do so in circumstances where there is a debt due and owing to the Principal by the Contractor.
  2. [25]
    Second, the Principal relies upon the liquidated damages clause in clause 34.7 of the contract, as set out at [23] above.
  3. [26]
    Reading clause 37.2 in its form set out at [17] above, the clause does not have a clear meaning. Even if it is accepted that the right of set-off is preserved in the circumstances identified in clauses 5.2 and 34.7, that does not assist in the interpretation of clause 37.2 which refers, on two occasions, to “the certificate in paragraph (b)” where no such paragraph actually exists.  Rather, I find that the meaning of clause 37.2 as conveyed to a reasonable person on a plain reading of the words are ambiguous in the form in which they appear in the signed contract, there being two references to the “certificate in paragraph (b)” where no such paragraph exists.
  4. [27]
    Accordingly, where the words are ambiguous, evidence of prior negotiations is admissible to establish the background facts that were known to both parties and the subject matter of the contract. That evidence is not admissible to establish the parties’ subjective intentions and expectations.

Background facts

  1. [28]
    In December 2021, the Principal sent draft terms of a contract to Tomkins.  The terms were in an amended form of AS4300-1995.  Clause 35.6 of the draft terms was entitled “Liquidated Damages for Delay in Reaching Practical Completion”.  That clause made provision for the circumstances in which the Principal may recover the amount of liquidated damages.  Clause 35.6 provided:

“35.6 Liquidated Damages for Delay in Reaching Practical Completion

If the Contractor fails to reach Practical Completion by the Date for Practical Completion, the Contractor shall be indebted to the Principal for liquidated damages at the rate stated in Item 43 for every day after the Date for Practical Completion to and including the Date of Practical Completion or the date that the Contract is terminated pursuant to Clause 44, whichever first occurs.

If after the Contractor has paid or the Principal has deducted liquidated damages, the time for Practical Completion is extended, the Principal shall forthwith repay to the Contractor any liquidated damages paid or deducted in respect of the period to and including the new Date for Practical Completion.

The Principal may recover the amount of liquidated damages:

  1. on demand from the Contractor;
  2. by deducting the amount from any amount otherwise certified by the Superintendent under clause 42; or
  3. from any Security,

even though Practical Completion has not occurred.

If liquidated damages are found to be void, voidable or unenforceable in any way or on any basis so that the Principal is not entitled to claim or recover liquidated damages for the Contractor’s failure to reach Practical Completion by the Date for Practical Completion, the Principal is entitled to claim and recover general law damages for breach of contract.” (emphasis in original)

  1. [29]
    On 20 December 2021 at around 7.15 am, Julian French on behalf of Tomkins sent an email and attachment to John Taylor (of the Superintendent) replying to the draft terms.  Amongst other things, the attachment to Mr French’s email identified in respect of clause 35.6 “Tomkins does not agree with the Principal being able to recover liquidated damages on demand or deducted from certified payments and security”.  Specifically, Tomkins suggested an amendment which deleted the whole of the last two paragraphs of clause 35.6, commencing with the words “The Principal may recover…”.
  2. [30]
    The Principal and Superintendent did not respond directly to that email, however thereafter, rather than using an amended version of AS4300-1995, the parties proceeded to negotiate terms based on a different Australian Standard contract and used an amended version of AS4902-2000.
  3. [31]
    On 21 December 2021, the Superintendent emailed to the Principal and Tomkins six documents which he identified “should make up the contract” including an amended version of AS4902-2000 General Conditions of Contract. Those documents had been “put together hastily” and the Superintendent stated he needed to “recheck” the documents the next day.
  4. [32]
    There was no directly comparable clause under the new contract to the clause 35.6 as set out above.  The new contract contained a clause 34.7 pertaining to liquidated damages which provided as follows:

“34.7 Liquidated Damages

If WUC does not reach practical completion by the date for practical completion, the Superintendent shall certify, as due and payable to the Principal, liquidated damages in Item 29 or every day after the date for practical completion to and including the earliest of the date of practical completion or termination of the Contract or the Principal taking WUC out of the hands of the Contractor.

If an EOT is directed after the Contractor has paid or the Principal has set off liquidated damages, the Principal shall forthwith repay to the Contractor such of those liquidated damages as represent the days the subject of the EOT.” (emphasis in original)

  1. [33]
    Having received the bundle of documents that “should make up the contract” which had been “put together hastily” Mr French of Tomkins responded by email 30 minutes later at 6.40 pm, attaching a “refined schedule of some contract departures” which Tomkins considered should be included in the contract “to reflect current issues”.  That schedule of contract departures did not include any amendments to clause 37.2.  Mr French’s email concluded that if the solicitors were to “…prepare the contract on this basis there should only be fine tuning to wording to bring it altogether”. 
  2. [34]
    The next day, on 22 December 2021 at 2.38 pm, Hopgood Ganim sent to Tomkins and the Principal the final version of the contract for execution.  It was in this final version that, for the first time, made a number of amendments to clause 37. Importantly, clause 37.2(b) had been deleted, but the remaining paragraphs in clause 37.2 referring to sub-paragraph (b) remained.  Most of the other changes pertained to timing issues but also included the deletion of clause 37.6.  Tomkins provided a marked-up copy of the contract so that the changes to clause 37 made for the first time by Hopgood Ganim on 22 December 2021 can be observed in full. That marked-up version of clause 37 is Annexure A to these Reasons.

Meaning of clause 37.2 (as amended)

  1. [35]
    Tomkins submits that the amendment of clause 37.2 was imperfect given that sub-paragraph (b) has been deleted but two residual references to sub-paragraph (b) remain.  In respect of those two residual references, Tomkins submits that the construction which is open, and which best fits the meaning of the words in clause 37.2 is that the two residual references have no work to do.  That is, Tomkins submits that the objective intention of the parties is that there is to be no sub-paragraph (b) certificate and therefore nothing that the Principal can elect to set off against a progress certificate.
  2. [36]
    Tomkins contends that that construction is supported by the consideration of admissible extrinsic evidence in two material respects.  The first is that the pre-contractual negotiations support the conclusion that that was the intention by Tomkins’ statement that it did not agree that the Principal would be able to recover liquidated damages on demand or deduct it from certified payments and security.  Second, because sub-paragraph (b) and clause 37.6 were both deleted, the latter also being the Principal’s right to elect to set off, the fact of the agreed deletions shows that the parties did not want the Principal to have the right to elect to set off the amounts owed by Tomkins to the Principal.
  3. [37]
    Tomkins also contends that its construction arrives at a result that is both commercially sensible and harmonious with the balance of the contract.  That is because, it is submitted, the Principal still can recover liquidated damages which become payable under a final certificate issued pursuant to clause 37.4.  That clause remained in the final contract although changes were made to the timing in which such final payment could be made. All that has happened by the combination of the amendments to clause 37 is to preserve the right of set off as one which has been postponed until the final certificate stage.
  4. [38]
    The Principal submits that there is no need to resort to extrinsic evidence as the absence of clause 37.2(b) does not affect the proper construction of the clause. That is because, the Principal contends, the right of set off has not been excluded by amendment or deletion. 
  5. [39]
    The Principal submits that the right of set off arises under clause 34.7.  The Principal relies upon the words “the Principal has set off” in the second paragraph of clause 34.7 as giving rise to an independent right of set off for liquidated damages and, because no change was made to that clause, nor was it deleted, the suggestion that the deletion of clause 37.2(b) operates to remove the right of set off is “fanciful”.
  6. [40]
    Next, the Principal contends that because clause 37.2(b) makes no mention of set off, it would be wrong to conclude that the deletion of any parts of it had any effect on the right to set off at all.
  7. [41]
    Tomkins submits that the language of the liquidated damages clause is such that the Superintendent shall certify as due and payable to the Principal those liquidated damages without any reference as to the time as to when that payment is to be made.  Specifically, the first paragraph of clause 34.7 does not identify that those liquidated damages are payable, for example, “on demand” or “forthwith”.
  8. [42]
    This could be contrasted, Tomkins submits, with the second paragraph of clause 34.7 which provides that in the circumstances that the Contractor has paid, or the Principal has set off liquidated damages, and the Principal “shall forthwith repay” to the Contractor such of those liquidated damages.  In contrast, the Principal contends that the words “due and payable” in the first sub-paragraph of clause 34.7 means payable at the Principal’s election. 
  9. [43]
    I reject the Principal’s construction of clause 37.2 for the following reasons.
  10. [44]
    First, I do not accept that clause 34.7 creates a right of set off in the way the Principal asserts.  Clause 34.7 deals with the entitlement to obtain liquidated damages if the work under the contract does not reach practical completion by the date of practical completion.
  11. [45]
    The liquidated damages under that clause can only arise in two circumstances.  The first is if the work under contract does not reach practical completion by the date for practical completion, then the Superintendent shall certify, as due and payable, liquidated damages calculated in accordance with the terms of the contract for every day after the date for practical completion until either termination or work being removed from the contractor. The second is if an extension of time is directed in certain circumstances which includes where the Principal “has set off liquidated damages” then the Principal must repay to the Contractor such of those liquidated damages as represent the days the subject of the extension of time. 
  12. [46]
    Both of those clauses in clause 34.7 arise under clause 34 which is the “Time and Progress” clause.  I do not construe clause 34 as creating the right of set off itself as submitted by the Principal.  Rather the right of set off must be contained elsewhere in the contract, and clause 34.7 identifies the timing which arises in two different circumstances in which liquidated damages might arise.  But nothing on the proper construction of clause 34.7 creates the right of set off itself.
  13. [47]
    Even if I am wrong on that issue, and clause 34.7 does create a right of set off, that still does not assist in determining what meaning ought to be attributed to the words in clause 37.2 “setting off such of the certificate in paragraph (b)” when there is no such clause or certificate.
  14. [48]
    Second, the Principal contends that the deleted clause 37.2(b) itself makes no mention of set off, but rather the clause deals with the retention of money and the certification of money due from the Principal to Tomkins.[6]  This is incorrect; the sub-clause uses the words “from the Contractor to the Principal”, not the reverse as the Principal submits. But in any event, I find that the balance of the clause creates the right of set off by providing the mechanism by which the set off occurs once the relevant Certificate has been issued.  The effect of the clause as a whole, when regard is had to the deleted words, is that clause 37.2 created the right of set off, not clause 34.7.
  15. [49]
    Third, the Principal contends that to read clause 37.2 as Tomkins does would produce an uncommercial result inconsistent with the expressed wording of clause 34.7 and the allocation of risk evidenced by the existence of the security clause in the contract.  I have already dealt with this issue.  Clause 34.7 is not affecting the right to liquidated damages in certain circumstances.  It pertains to the timing and progress of those damages, but not the right.  The Principal’s submissions in relation to this issue stretches the proper interpretation of clause 34.7 in a way which is not warranted even with the reading down of clause 37.2.
  16. [50]
    Fourth, the Principal contends that the equitable right of set off is unaffected by the removal of clause 37.2(b).  The Principal submits that if the right was intended to be curtailed, express and specific language to that effect was necessary.  In my view, that is precisely the effect of the deletion of clause 37.2(b).  The words of the contract are clear and specific, in that the right exists in the final accounting between the parties, which I refer to below, but the amendment to the clause was intended to, and did, remove that right until the final certificate stage as arises under clause 37.4.
  17. [51]
    I proceed on the basis that clause 37.2 as it is read after the deletion of sub-paragraph (b) is ambiguous because the references throughout the clause to sub-paragraph (b) cannot sensibly be understood when that sub-paragraph has been removed. It is no leap to infer that the sub-paragraph has been intentionally deleted. The reasonable businessperson would not have understood, or been able to understand, what those parts of clause 37.2 meant that made reference to a certificate issued under sub-paragraph (b), even having regard to the language used, the surrounding circumstances known to the parties, and the commercial purpose of the contract.
  18. [52]
    The clause being ambiguous, the court then looks at the deleted words to derive any assistance in resolving the ambiguity.[7] I find that sub-clause (b) is a sub-clause directed to the Superintendent’s assessment of retention moneys and moneys due from the Contractor to the Principal. The two certificates, money owed to the Contractor and money owed by the Contractor were to be set off against each other at the Principal’s election. The deletion of sub-clause (b) removed the certification process that could give rise to the setting off.
  19. [53]
    Next, the removal of sub-clause (b) is consistent with Tomkins earlier email advice to the Principal that Tomkins did not agree with the Principal being able to recover liquidated damages on demand or deducted from certified payment and security. The references left in clause 37 to set off is setting off that would occur, for example, in the context of a liquidated damages claim. But the parties had, I find, agreed to remove that right when the email of Tomkins of 21 December rejecting that right was deleted from clause 37.2(b)
  20. [54]
    In so finding, the court is doing no more than having recourse to events, circumstances and things external to the contract that are necessary in determining the proper construction where there is a constructional choice.[8]  While the clause after the deletions might well fit the description given by Gageler J (as the Chief Justice then was) of a “clumsily tailored variation of an ill-fitting off the shelf precedent”,[9]  the construction I favour brings greater commercial sense to the agreement.
  21. [55]
    Further, this construction does not lead to the consequence that the Principal will be denied the right of set off absolutely.  Clause 37.4 of the Contract provides for the final payment claim and the final certificate.  At the expiration of the defects liability period, or within ten business days after receipt of the final payment claim, whichever is the earlier, the Superintendent shall issue to both the Contractor and the Principal a final certificate evidencing the moneys due and payable between the Contractor and the Principal.  The clause provides that the final certificate shall be conclusive evidence of accord and satisfaction, and in discharge of each party’s obligations under the Contract, except for, amongst other things, unresolved issues the subject of any notice of disputes pursuant to clause 42 served before the seventh day after the issue of the final certificate.  The notice of dispute under clause 42 covers a wide range of disputes between the parties in connection with the subject matter of the contract but includes claims in tort, under statute, for restitution based on unjust enrichment or other quantum meruit, claims for rectification or frustration, or any “like claim available under the law governing the contract”.  The proper construction of clause 37.4 and 42 provides that disputes in relation to set off claims can there be dealt with. As such the deletion of clause 37.2(b), which would otherwise have given rise to a Certificate that the Principal could elect to set off under sub-para (b), is not lost on this construction, but is preserved to the final payment claim stage of the contract under clause 37.4.
  22. [56]
    Accordingly, the applicant is entitled to the declaration that under the contract between the applicant and the respondent dated 22 December 2021, as varied by a deed of variation dated 15 August 2022, the Principal does not have a right to elect to set off against moneys due from the Principal to the Contractor certified in a progress certificate pursuant to clause 37.2(a) of the general conditions of contract any liquidated damages certified under clause 34.7 of the general conditions of contract. 
  23. [57]
    The next declaration that Tomkins seeks is that the Principal does not have any right of recourse to the Security given under the contract in respect of the amounts purportedly certified by the Superintendent as payable from Tomkins to the Principal in:
    1. Liquidated Damages Certificate No. 5 issued on 2 October 2024; and
    2. Payment Certificate No. 32 issued on 2 October 2024.
  24. [58]
    Security was originally dealt with pursuant to clause 5 of the contract, which was subsequently replaced by the terms of a multipartite deed which was entered into on 6 May 2022. Clause 5.2 of the general conditions was deleted and replaced with the clause already set out at [23] above.
  25. [59]
    Accordingly, recourse to security arises if there is an amount payable by the Contractor to the Principal, and the due date for payment of that amount has passed.
  26. [60]
    The Principal contends that the liquidated damages owed by Tomkins to the Principal which arises under cl 34.7 is the amount which is payable by the Contractor to the Principal such as to give the Principal right to recourse to security. That submission ignores the second requirement in relation to timing, that is that the due date for payment has passed. That would require the liquidated damages clause in 34.7 to be construed as if there was an immediate right to payment rather than a right to set off in the final accounting, as I have already found there to be. 
  27. [61]
    The word “due” in clause 34.7 is susceptible to different shades of meaning depending on the context in which it appears[10] and, without more, does not include an amount which is only contingently due. Here, although clause 34.7 uses the phrase “due and payable”, I have already found that the timing of the payment is still governed by clause 37.4 in relation to the final payment claim.
  28. [62]
    It follows that if the liquidated damages are not immediately payable, as I have found them not to be, then the right to recourse to security does not arise immediately. As such the second of the declarations which Tomkins seeks ought to be made.
  29. [63]
    It naturally follows that the declarations that are sought in the originating application will be made. It also follows that the progress certificate of $694,343 is payable, and there ought to be an order for such payment, plus interest.

Alternative issue – injunction regarding security pending resolution of the arbitration

  1. [64]
    Strictly it is not necessary for me to decide this issue, but given that it was argued it is appropriate that I address the submissions in relation to the injunction question. The orders sought here are:

“An order that the Respondent by itself, its employees and agents, be restrained permanently from calling on, demanding, receiving or having any recourse to and converting into money Australia and New Zealand Banking Group (ANZ) Bank Guarantee No. GOP51462163418 and ANZ Bank Guarantee No. GOP51462203418 both dated 9 May 2022, being the bank guarantees issued in favour of the Respondent under the Contract between the Applicant and the Respondent dated 22 December 2021, as varied by a Deed of Variation dated 15 August 2022 (Bank Guarantees) respect of any or all of the Purportedly Certified Amounts.” (emphasis in original)

  1. [65]
    The terms of the undertaking provide:

“The undertaking is to continue until notification has been received from the Principal that the sum is no longer required by the Principal or until this undertaking is returned to the Financial Institution or until payment to the Principal by the Financial Institution of the whole of the sum or such part as the Principal may require.

Should the Financial Institution be notified in writing…that the Principal desires payment to be made of the whole or any part or parts of the sum, it is unconditionally agreed that the Financial Institution will make a payment or payments to the Principal forthwith without reference to the Contractor and notwithstanding any notice given by the Contractor not to pay the same.” (emphasis in original)

  1. [66]
    The injunction issue would only arise in circumstances where the court concluded that the liquidated damages certified by the Superintendent are due and owing and the Principal has the right to set them off against a progress claim.  In those circumstances, Tomkins submits that the court would grant an injunction to preserve the status quo rather than allow the Principal to access the security which is held in the form of a bank guarantee.
  2. [67]
    It can be accepted for the purposes of these submissions that the commercial purpose of bank guarantees is that they be an equivalent to cash.[11]  They provide the beneficiary of the guarantee with a security which is only defeasible in such limited circumstances that it is to be regarded as approximating cash.[12]
  3. [68]
    There are, therefore, limited circumstances in which court will enjoin a party from recourse to a bank guarantee and those exceptions include fraud or unconscionability in contravention of the Competition and Consumer Act 2010 (Cth) and related circumstances. Such clauses provide a mechanism to allocate the risk between the parties as to who shall be out-of-pocket pending the resolution of a dispute between them.[13]  As a risk allocation device, commonly referred to in the industry as “pay now, argue later” they are a powerful mechanism which serves a strong commercial purpose in the provision of security.  Second, the mechanism provides security for valid claims against the contractor.   In order to restrain the Principal from accessing the security, the court would need to consider the usual principles arising on an application for an interlocutory injunction -– a serious question to be tried and the balance of convenience -– through the prism of the authorities that, having regard to the commercial purpose of the guarantees, injunctive relief would not lightly be granted.
  4. [69]
    Turning first to the serious question to be tried.
  5. [70]
    There are four disputed variation claims which were identified in the Notice of Dispute.  The first variation claim pertains to delay costs associated with an extension of time and amounts to $1,031,530.35.  The second is a cost associated with tower cranes which amounts to $204,056.68.  The third are delay costs associated with an extension of time invoice amounting to $404,404.36, whilst the fourth relates to a cost for acoustic louvres amounting to $333,374.55.  Tomkins maintains that there is a factual dispute as to whether the Superintendent’s certifications were correct and relies upon this as the serious question to be resolved at the arbitration. 
  6. [71]
    The amounts involved are not insignificant, and if Tomkins is correct, there would be no net amount payable to the Principal. There is therefore a serious question to be tried.
  7. [72]
    The balance of convenience question is more difficult.
  8. [73]
    Recognising that the commercial purpose of such a security provision is firstly to provide security to the holder by enabling recourse against a third party bank, and secondly to allocate the risk as to which party should be out-of-pocket pending resolution of any dispute which may arise,[14]  clear words would be required to support a construction that inhibited a beneficiary from calling on a performance guarantee.
  9. [74]
    In Clough Engineering Ltd v Oil & Natural Gas Corporation Ltd,[15] the Full Court of the Federal Court summarised the relevant principles as including:
    1. a recourse provision should be construed in light of all the other relevant provisions of the contract, including the terms of the security which formed part of the contract;
    2. in construing any contractual limitation on the exercise by a party to have recourse to its rights to the security, the court should take into account the commercial purposes served by security clauses in construction contracts; and
    3. the commercial background for the contract informs the construction of a security clause, so that the court should not too readily favour a construction which is inconsistent with an agreed allocation of risk as to who is to be out-of-pocket pending resolution of the dispute.
  10. [75]
    Accordingly, clear words are required to support a construction that inhibits a beneficiary of a security clause from calling on a performance guarantee where a breach is alleged in good faith, that is non-fraudulently.
  11. [76]
    Tomkins submits that the following factors are relevant to the balance of convenience.
  12. [77]
    First, the irreparable reputational damage to Tomkins if an injunction were refused but Tomkins was ultimately successful in arbitration, such that the damage would not be compensable by an award of damages.  In that regard the evidence demonstrates that Tomkins is a family owned and operated construction company that has been operating for over 70 years.  It designs and constructs a wide variety of residential, commercial, industrial and retail projects.  It has offices in Brisbane, the Gold Coast and the Sunshine Coast and tenders for work typically undertaken in South East Queensland.  Tomkins is currently constructing nine projects worth combined contract price in excess of $367 million.  It has been required to provide security under the contracts for all of these projects in the form of unconditional undertakings, but it has never had a call on an unconditional undertaking or a bank guarantee.  It is submitted that it is Tomkins’ commercial reputation that sets it apart from others in the industry and, given that Tomkins is currently pursuing tender opportunities for a further $100 million worth of projects over the next two years, if the Principal is committed to have recourse to the security under this contract that will likely detrimentally affect the commercial reputation of Tomkins and its perceived ability to perform its contractual obligations.
  13. [78]
    Justice Rolfe considered similar sort of evidence in Barclay Mowlem Construction Ltd v Simon Engineering (Australia) Pty Ltd[16] and observed that if a comparable performance bond were called upon:

“…people may be tempted to ask whether the plaintiff’s business was ‘going downhill’.  I find it difficult to see how a court could ever assess the damage occasioned to the plaintiff in these circumstances.  I am of course not overlooking the fact that the court must do its best to assess damages, but it is only necessary to state the type of problems which may confront the plaintiff to demonstrate the difficulty, if not impossibility, which it would face in proving the quantum thereof …”

  1. [79]
    In such a circumstance, his Honour considered that those facts were persuasive ones in favour of the grant of an injunction.
  2. [80]
    Chesterman J in Austrak Pty Ltd v John Holland Pty Ltd[17]  would not have accorded any particular significance to the effect on business reputation of a contractor although his Honour did not feel free to disregard the strong expressions of opinions from judges such as Rolfe J. Accordingly, Chesterman J was prepared to accept that evidence ought to be taken into account as demonstrating that the applicant may suffer damage to its reputation which could not be adequately recompensed by an award of damages should it turn out that respondent wrongly demanded payment.
  3. [81]
    Chesterman J’s hesitation was shared by the Court of Appeal in Monadelphous Engineering Pty Ltd & Anor v Wiggins Island Coal Export Terminal Pty Ltd.[18]  Given that the evidence of Tomkins set out above was not tested by cross-examination or contradicted by other evidence, nor is it inherently implausible, it should be given some weight.[19]
  4. [82]
    The second factor which Tomkins relies upon in its favour on the balance of convenience question, is evidence that there is a risk that Tomkins would not be paid, even if it was successful at arbitration.  The evidence demonstrates that an ASIC current and historical company search for the Principal shows that when the Principal was incorporated on 31 October 2017 it had $100 of paid-up capital.  An asset search carried out at the same time identified that the Principal owned a number of pieces of property, seven in total, on which every title reference has the status of “cancelled”.  Tomkins submits that the inference is open that the Principal was established as a special purpose vehicle for this project and the project completion date is imminent.  When completion occurs, and the Principal as a special purpose vehicle has its purpose at an end, it may be that the Principal is left with a nominal equity position.  Tomkins therefore faces, it contends, a risk of non-payment which can be ameliorated by the granting of the injunction. The Principal did not challenge these matters factually, and therefore I take them into account as ones favouring the grant of the injunction.
  5. [83]
    The third factor relevant to the balance of convenience is that Tomkins gives the usual undertaking as to damages but further, and specifically, whilst the contract is nearing completion and there remains a real prospect that the bank guarantee will have to be returned to Tomkins once practical completion is reached, which is imminent, Tomkins offers further security in the form of the extension of the bank guarantee. This is a persuasive factor in the balance of convenience.
  6. [84]
    Next, Tomkins contends that the clause in question here is not a risk allocation clause, the “strong pointer” to that fact being that the bank guarantee does not have a fixed temporal limit.[20] That means, Tomkins contends, that because the guarantees cannot expire in the way in which they did in Daewoo’s case they therefore do not serve a relevant risk allocation purpose. The terms of the guarantee provide:

“Undertaking:

ANZ will pay the Amount or any part of it to the Beneficiary upon presentation of the original Undertaking (accompanied by a written demand)…without reference to the Applicant and even if the Applicant has given ANZ notice not to pay the money, and without regard to the performance or non-performance of the Applicant or Beneficiary under the terms of the contract or agreement…

This Undertaking remains in force until the first to occur of:

  1. –The Beneficiary notifies ANZ in writing that the Undertaking is no longer required.
  1. –This original Undertaking is returned to ANZ…
  1. –ANZ has paid to the Beneficiary the Amount or balance outstanding of the Amount.”
  1. [85]
    The Principal submits that if a performance bond is intended to operate as a risk allocation device (pay now, argue later) pending final determination of the dispute between the parties, then that intention must be fundamental to a consideration of the justice of the application made to restrain recourse to such a bond pending final determination of the dispute. The Principal rejects the emphasis of the fixed temporal limit and relies instead upon the fact that is it a fundamental characteristic of a bank guarantee that it is a risk allocation device, such that the consideration of the grant of the injunction is altered by the contractual context of such a device.[21]
  2. [86]
    Whether the clause in question means that it is being used as a risk allocation device will of course be a powerful factor but does involve construing the relevant contractual provision as part of the broader contract as a whole.  If having construed the provision the court concludes that it serves, in addition to security, a risk allocation purpose, then it can be accepted, as it was in Saipem Australia Pty Ltd v GLNG Operations Pty Ltd (No 2), then that may have an impact, and perhaps a decisive impact, upon the balance of convenience if the court is asked to restrain by an interlocutory injunction the use of the guarantee.[22]  The court must therefore carefully construe the terms of the contract.  In Saipem No 2, the relevant contractual provision included at clause 5.5(c):

“The contractor convenants with the company that the contractor will not institute any proceedings, exercise any right or take any steps to injunct or otherwise restrain:

  1. the financial institution that issued the Performance Security from paying the company pursuant to the Performance Security;
  1. the company from taking any steps for the purpose of making a demand under any Performance Security or receiving payment under any Performance Security, or otherwise exercising its rights under any Performance Security; or
  1. the company using the money received under any Performance Security,

 even where the contractor disputes the company’s right to payment (including where dispute resolutions proceedings have been commenced under this Contract).”

McMurdo J found that that form of words was a clear demonstration of a risk allocation clause.[23]

  1. [87]
    In the current circumstances, the contract does not contain any equivalent “no injunction” clause to that which appeared in Saipem No 2.  In fact, clause 42.4 of the current contract expressly reserves Tomkins’ right to seek injunctive or urgent declaratory relief. That clause provides:

“Nothing herein shall prejudice the right of a party to institute proceedings to enforce payment due under the Contract or to seek injunctive or urgent declaratory relief.” 

  1. [88]
    In that way, the current contract is quite different to the contract under consideration in Saipem No 2. While the security offered by the bank guarantees is as I say, a powerful factor leading to the conclusion that the recourse to the security was intended as a risk allocation device, the preservation of the injunction clause in 42.4 is against that conclusion.
  2. [89]
    Although the considerations are finely balanced, I conclude that the balance of convenience would have favoured the grant of the injunction because, first, the period of the injunction would be quite short, coming as it does, towards the end of the contract works. Second, the right to the grant of an injunction was preserved by clause 42.4. Third, the extension of the guarantee provides significant financial security to the Principal. Fourth, the risk of Tomkins not being repaid is balanced against the security of the Principal. Finally (although of much lesser weight) the reputational damage to Tomkins is minimised.
  3. [90]
    The orders of the court are:
  1. Under the contract between the applicant and the respondent dated 22 December 2021, as varied, (the Contract) the Principal does not have a right to elect to set off against moneys due from the Principal to the Contractor certified in a progress certificate pursuant to clause 37.2(a) of the General Conditions of Contract any liquidated damages certified under clause 34.7 of the General Conditions of Contract.
  2. The Principal does not have any right of recourse to the Security given under the Contract in respect of any amount or amounts purportedly certified by the Superintendent as payable from the applicant to the respondent in:

a. Liquidated Damages Certificate No. 05 issued on 2 October 2024; and

b. Payment Certificate No. 32 on 2 October 2024.

  1. The following notices given by the respondent to the applicant dated 11 October 2024 are invalid and of no effect:

a. The notice given by the Respondent of the Respondent’s intention to have recourse to Security under General Condition 5.2 of the Contract; and

b. The notice given by the Respondent purportedly under section 67J of the Queensland Building and Construction Commission Act 1991 (Qld).

  1. A declaration that $694,343.00 is payable by the Respondent to the Applicant within 15 business days after 25 September 2024 as the balance of the progress certificate constituted by Payment Certificate No. 32 issued on 2 October 2024.
  2. An order for payment by the Respondent to the Applicant of:

a. $694,343.00; and

b. Interest pursuant to s 58 of the Civil Proceedings Act 2011 (Qld) or pursuant to clause 37.5 of the Contract at the rate of 10% or such other rate as the court considers appropriate on the amount in (a) calculated from 18 October 2024 until the date of judgment.

  1. The respondent is to pay the applicant’s costs of the application on the standard basis.

Annexure “A”

37 Payment

37.1 Progress claims

The Contractor shall claim payment progressively in accordance with Item 33. 

An early progress claim shall be deemed to have been made on the date for making that claim.

Each progress claim shall be given in writing to the Superintendent and shall include details of the value of WUC done and may include details of other moneys then due to the Contractor pursuant to the provisions of the Contract. 

The parties agree that each progress claim given by the Contractor pursuant to this clause is a request for payment by the Contractor of the amount claimed in the progress claim.

The parties agree that each progress claim given by the Contractor pursuant to this clause is a request for payment by the Contractor of the amount claimed in the progress claim.

37.2 Certificates

The Superintendent shall, within 14 10 business days after receiving such a progress claim, issue to the Principal and the Contractor:

  1. a progress certificate evidencing the Superintendent’s opinion of the moneys due from the Principal to the Contractor pursuant to the progress claim and reasons for any difference (‘progress certificate’); and
  1. a certificate evidencing the Superintendent’s assessment of retention moneys and moneys due from the Contractor to the Principal pursuant to the Contract.

If the Contractor does not make a progress claim in accordance with Item 33, the Superintendent may issue the progress certificate with details of the calculations and shall issue the certificate in paragraph (b).

Subject to clause 7.3, the Superintendent in receiving a progress claim does so as agent of the Principal for the purposes of the BIF Act.

If the Superintendent does not issue the progress certificate within 14 10 business days of receiving a progress claim in accordance with subclause 37.1, that progress claim shall be deemed to the relevant progress certificate.

The Principal shall within 7 days after receiving both such certificates, or within 2115 business days after the Superintendent receives the progress claim, pay to the Contractor the balance of the progress certificate after setting off such of the certificate in paragraph (b) as the Principal elects to set off.  If that setting off produces a negative balance, the Contractor shall pay that balance to the Principal within 75 business days of receiving written notice thereof.

Either a progress certificate nor a payment of moneys shall be evidence that the subject WUC has been carried out satisfactorily.  Payment other than final payment shall be payment on account only. 

37.3 Unfixed plant and materials

The Principal shall not be liable to pay for the unfixed plant materials unless they are listed in Item 34 and the Contractor:

  1. provides the additional security in Item 14(e); and
  1. satisfies the Superintendent that the subject plant and materials have been paid or, properly stored and protected, and labelled the property of the Principal.

Upon payment to the Contractor and the release of any additional security in paragraph (a), the subject plant and materials shall be the unencumbered property of the Principal.

37.4 Final payment claim and certificate

Within 2820 business days after the expiry of the last defects liability period, the Contractor shall give the Superintendent a written final payment claim endorsed ‘Final Payment Claim’ being a progress claim together with all otherof the claims whatsoever in connection with the subject matter of the Contract.

Within 4230 business days after the expiry of the last defects liability period or within 10 business days after receipt of the final payment claim, whichever is the earlier, the Superintendent shall issue to both the Contractor and the Principal a final certificate evidencing the moneys finally due and payable between the Contractor and the Principal on any account whatsoever in connection with the subject matter of the Contract. 

Those moneys certified as due and payable shall be paid by the Principal or the Contractor, as the case may be, within 75 business days after the debtor receives the final certificate, or within 15 business days after the Superintendent receives the final payment claim.

The final certificate shall be conclusive evidence of accord and satisfaction, and in discharge of each party’s obligations in connection with the subject matter of the Contract except for:

  1. fraud or dishonesty relating to WUC or any part thereof or to any matter dealt with in the final certificate;
  1. any defect or omission in the Works or any part thereof which was not apparent at the end of the last defects liability period, or which would not have been disclosed upon reasonable inspection at the time of the issue of the final certificate;
  1. any accidental or erroneous inclusion or exclusion of any work or figures in any computation or an arithmetical error in any computation; and
  1. unresolved issues the subject of any notice of dispute pursuant to clause 42, served before the 7th day after the issue of the final certificate. 

37.5 Interest

Interest in Item 35 shall be due and payable after the date of default in payment.

37.6 Other moneys due

The Principal may elect that moneys due and owing otherwise than in connection with the subject matter of the Contract also be due to the Principal pursuant to the Contract.

Footnotes

[1] Electricity Generation Corporation t/as Verve Energy v Woodside Energy Ltd (2014) 251 CLR 640 at [35] per French CJ, Hayne, Crennan and Kiefel JJ.

[2] Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at [46]–[50] per French CJ, Nettle and Gordon JJ (see also [108]-[109] per Kiefel CJ and Keane J).

[3] Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337 at 352 per Mason J.

[4] A Goninan & Co Ltd v Direct Engineering Services Pty Ltd (No 2) [2008] WASCA 112 at [37]–[40] per Buss JA (Martin CJ and McLure JA agreeing), citing inter alia Postle v Sengstock [1994] 2 Qd R 290 at 298 (Macrossan CJ, McPherson JA, Derrington J). 

[5]  This approach was explained by Diplock J in Louis Dreyfus & Cie v Parnaso cia Naviera SA [1959] 1 QB 498 at 513, cited in Postle v Sengstock [1994] 2 Qd R 290 at 298 (Macrossan CJ, McPherson JA, Derrington J).

[6]  Principal’s submissions at [56].

[7] Louis Dreyfus & Cie v Parnaso Cia Naviera SA [1959] 1 QB 498 at 513; Postle v Sengstock [1994] 2 Qd R 290.

[8] Mount Bruce v Wright Prospecting [2015] 256 CLR 104 at 117 [49].

[9] Ecosse Property Holding Pty Ltd v Gee Dee Nominees Pty Ltd (2017) 261 CLR 544 at [51].

[10] Merritt Cairns Constructions Pty Ltd v Wulguru Heights Pty Ltd [1995] 2 Qd R 521 per McPherson JA.

[11] Wood Hall Ltd v The Pipeline Authority (1979) 141 CLR 443 at 445, 453 and 457-458.

[12] Redline Contracting Pty Ltd v MCC Mining (Western Australia) Pty Ltd [2011] FCA 1337 at [31].

[13] Fletcher Construction Australia Ltd v Varnsdorf Pty Ltd [1998] 3 VR 812 at 821.

[14] Sugar Australia Pty Ltd v Lend Lease Services Pty Ltd [2015] VSCA 98 at [89].

[15]  (2008) 249 ALR 458.

[16]  (1991) 23 NSWLR 451.

[17]  [2006] QSC 103 at [34].

[18]  [2014] QCA 330 at [44].

[19] Saipem Australia Pty Ltd v GLNG Operations Pty Ltd (No 2) [2016] 1 Qd R 254 at [45] (“Saipem No 2”).

[20] Daewoo Shipbuilding & Marine Engineering Co Ltd v Inpex Operations Australia Pty Ltd (2022) 404 ALR 503 at [105].

[21] Daewoo at [77].

[22] Saipem No 2 per McMurdo J at [49].

[23]  At [51].

Close

Editorial Notes

  • Published Case Name:

    Tomkins Commercial & Industrial Builders Pty Ltd v Pacific Diamond 88 Pty Ltd as trustee for the Pacific Diamond 88 Unit Trust

  • Shortened Case Name:

    Tomkins Commercial & Industrial Builders Pty Ltd v Pacific Diamond 88 Pty Ltd

  • MNC:

    [2024] QSC 321

  • Court:

    QSC

  • Judge(s):

    Treston J

  • Date:

    20 Dec 2024

  • White Star Case:

    Yes

Litigation History

EventCitation or FileDateNotes
Primary Judgment[2024] QSC 32120 Dec 2024Declarations made in respect of dispute arising under building contract: Treston J.
Notice of Appeal FiledFile Number: CA 153/2514 Jan 2025Notice of appeal filed.
Appeal Determined (QCA)[2025] QCA 5011 Apr 2025Appeal dismissed: Bond JA (Mullins P and Crow J agreeing).

Appeal Status

Appeal Determined (QCA)

Cases Cited

Case NameFull CitationFrequency
A Goninan & Co Limited v Direct Engineering Services Pty Ltd. [No. 2] [2008] WASCA 112
2 citations
Jump To
Cite 1 - [2008] WASCA 112
Cite 2 - [2008] WASCA 112
Austrak Pty Ltd v John Holland Pty Ltd [2006] QSC 103
2 citations
Jump To
Cite 1 - [2006] QSC 103
Cite 2 - [2006] QSC 103
Barclay Mowlem Construction Ltd v Simon Engineering (Australia) Pty Ltd (1991) 23 NSWLR 451
2 citations
Jump To
Cite 1 - (1991) 23 NSWLR 451
Cite 2 - (1991) 23 NSWLR 451
Clough Engineering Ltd v Oil and Natural Gas Corporation Ltd (2008) 249 ALR 458
2 citations
Jump To
Cite 1 - (2008) 249 ALR 458
Cite 2 - (2008) 249 ALR 458
Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 C.L R. 337
2 citations
Jump To
Cite 1 - (1982) 149 C.L R. 337
Cite 2 - (1982) 149 C.L R. 337
Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd (2017) 261 CLR 544
2 citations
Jump To
Cite 1 - (2017) 261 CLR 544
Cite 2 - (2017) 261 CLR 544
Electricity Generation Corporation (t/as Verve Energy) v Woodside Energy Ltd and Ors (2014) 251 CLR 640
2 citations
Jump To
Cite 1 - (2014) 251 CLR 640
Cite 2 - (2014) 251 CLR 640
Fletcher Construction Australia Ltd v Varnsdorf Pty Ltd (1998) 3 VR 812
2 citations
Jump To
Cite 1 - (1998) 3 VR 812
Cite 2 - (1998) 3 VR 812
Louis Dreyfus & Cie. v Parnaso cia. Naviera S.A. (1959) 1 QB 498
3 citations
Jump To
Cite 1 - (1959) 1 QB 498
Cite 2 - (1959) 1 QB 498
Cite 3 - (1959) 1 QB 498
Merritt Cairns Constructions Pty Ltd v Wulguru Heights Pty Ltd[1995] 2 Qd R 521; [1995] QCA 273
2 citations
Jump To
Cite 1 - [1995] 2 Qd R 521
Cite 2 - [1995] 2 Qd R 521
Monadelphous Engineering Pty Ltd v Wiggins Island Coal Export Terminal Pty Ltd [2014] QCA 330
2 citations
Jump To
Cite 1 - [2014] QCA 330
Cite 2 - [2014] QCA 330
Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104
3 citations
Jump To
Cite 1 - (2015) 256 CLR 104
Cite 2 - (2015) 256 CLR 104
Cite 3 - (2015) 256 CLR 104
Postle v Sengstock [1994] 2 Qd R 290
4 citations
Jump To
Cite 1 - [1994] 2 Qd R 290
Cite 2 - [1994] 2 Qd R 290
Cite 3 - [1994] 2 Qd R 290
Cite 4 - [1994] 2 Qd R 290
Redline Contracting Pty Ltd v MCC Mining (Western Australia) Pty Ltd [2011] FCA 1337
2 citations
Jump To
Cite 1 - [2011] FCA 1337
Cite 2 - [2011] FCA 1337
Saipem Australia Pty Ltd v GLNG Operations Pty Ltd (No 2)[2016] 1 Qd R 254; [2015] QSC 173
2 citations
Jump To
Cite 1 - [2016] 1 Qd R 254
Cite 2 - [2016] 1 Qd R 254
Sugar Australia Pty Ltd v Lend Lease Services Pty Ltd [2015] VSCA 98
2 citations
Jump To
Cite 1 - [2015] VSCA 98
Cite 2 - [2015] VSCA 98
Wood Hall Ltd v The Pipeline Authority (1979) 141 CLR 443
2 citations
Jump To
Cite 1 - (1979) 141 CLR 443
Cite 2 - (1979) 141 CLR 443

Cases Citing

Case NameFull CitationFrequency
Pacific Diamond 88 Pty Ltd v Tomkins Commercial & Industrial Builders Pty Ltd [2025] QCA 50 1 citation
1

Require Technical Assistance?

Message sent!

Thanks for reaching out! Someone from our team will get back to you soon.

Message not sent!

Something went wrong. Please try again.