Federal Court of Australia East Rockingham RRF Project Co Pty Ltd as Trustee for the East Rockingham RRF Project Trust v Acciona Construction Australia Pty Ltd (No 2) [2024] FCA 1014 File number: WAD 72 of 2024 Judgment of: FEUTRILL J Date of judgment: 4 September 2024 Catchwords: PRACTICE AND PROCEDURE – security as condition of trial of issues raised by way of defence – summary judgment Legislation: Corporations Act 2001 (Cth) Pts 5.2-5.9 Federal Court of Australia Act 1976 (Cth) ss 23, 37M, 37P(2) Federal Court Rules 2011 (Cth) rr 1.32, 1.33, 1.34, 1.35, 1.40, 1.41, 5.04, 9.05(1); Div 10.3 Property Law Act 1969 (WA) s 11(2) Cases cited: Clough Engineering Ltd v Oil and Natural Gas Corporation Ltd [2008] FCAFC 136; 249 ALR 458 East Rockingham RRF Project Co Pty Ltd as Trustee for the East Rockingham RRF Project Trust v Acciona Construction Australia Pty Ltd [2024] FCA 759 Hastie Group Ltd (in liq) v Multiplex Constructions Pty Ltd (No 3) [2022] FCA 1280; 410 ALR 531 Simic v New South Wales Land and Housing Corporation [2016] HCA 47; 260 CLR 85 Sino Iron Pty Ltd v Mineralogy Pty Ltd (No 2) [2017] WASCA 76; 55 WAR 36 Division: General Division Registry: Western Australia National Practice Area: Commercial and Corporations Sub-area: Commercial Contracts, Banking, Finance and Insurance Number of paragraphs: 30 Date of hearing: 16 August 2024 Counsel for the Applicant: Mr SK Dharmananda SC with Mr L Firios and Mr NL Pham Solicitor for the Applicant: Herbert Smith Freehills Counsel for the First, Second and Third Respondents: Mr C Young KC with Mr TJ Porter Solicitor for the First, Second and Third Respondents: Gilbert + Tobin Counsel for the Security Trustee: Ms JK Taylor SC Solicitor for the Security Trustee: King & Wood Mallesons ORDERS WAD 72 of 2024 BETWEEN: EAST ROCKINGHAM RRF PROJECT CO PTY LTD ABN 83 623 495 278 AS TRUSTEE FOR THE EAST ROCKINGHAM RRF PROJECT TRUST Applicant AND: ACCIONA CONSTRUCTION AUSTRALIA PTY LTD ACN 618 030 872 First Respondent ACCIONA M&E PTY LTD (FORMALLY JOHN BEEVER (AUST) PTY LTD) ACN 618 030 872 Second Respondent ACCIONA INDUSTRIAL AUSTRALIA PTY LTD ACN 620 692 784 (and others named in the Schedule) Third Respondent order made by: FEUTRILL J DATE OF ORDER: 4 SEPTEMBER 2024 THE COURT ORDERS THAT: 1. By 4.30 pm (AWST) on 30 September 2024 the first, second and third respondents provide security in the sum of AUD 38,631,149.64 as a condition upon which they are permitted to defend the applicant's claim for a mandatory injunction or, alternatively, specific performance, by way of: (a) irrevocable bank guarantee(s) payable on demand issued by an Australian trading bank registered pursuant to the Banking Act 1959 (Cth) in a form satisfactory to the Registrar; alternatively (b) payment into Court. 2. Any bank guarantee referred to in paragraph 1(a) of these orders must have terms to the following effect: (a) the issuing bank agrees that payment will only be made in accordance with these orders; (b) subject to sub-paragraph 2(c) of these orders, any amount payable under the guarantee must be paid into Court or at the direction of the Court; (c) if at the time of making a demand for payment the applicant gives the issuing bank notice that no objection has been made under paragraph 5 of these orders, then the issuing bank be directed to pay the amount demanded to or at the direction of the applicant; and (d) except as is inconsistent with paragraph 1 and 2(a), 2(b) and 2(c) of these orders, in the form and on the terms set out in Schedule 20 of the engineering, procurement and construction contract made between the applicant and the respondents dated 20 December 2019 (EPC Contract). 3. The applicant may demand payment under a bank guarantee provided in compliance with paragraph 1 of these orders, alternatively make a request for payment of an amount out of Court, on any ground upon which it would be entitled to make that demand under a Bank Guarantee as defined in and provided in accordance with the provisions of the EPC Contract. 4. Before making a demand under a bank guarantee provided in compliance with paragraph 1 of these orders, or request for payment out of Court, the applicant must file and serve a notice of its intention to do so on the first, second and third respondents (service to be in accordance with Div 10.3 of the Federal Court Rules 2011 (Cth)) 48 hours before the date upon which it intends to make that demand or request indicating the amount of the intended demand, or request, and the contractual ground(s) for that demand. 5. Within 48 hours of service of a notice in accordance with paragraph 4 of these orders the first, second and third respondents must file and serve any notice of objection to payment of the amount demanded, or requested, failing which, the first, second and third respondents will be taken not to so object. 6. After the time for the filing and serving any notice of objection in accordance with paragraph 5 of these orders has expired, the applicant may make a demand for payment to the issuing bank, alternatively request for payment out of Court. 7. If no notice of objection is filed and served in accordance with paragraph 5 of these orders, then: (a) the issuing bank may pay the amount demanded to or at the direction of the applicant and, otherwise, must pay the amount demanded into Court; or (b) the Registrar may authorise payment of the amount requested out of Court to or at the direction of the applicant. 8. If a notice of objection is filed and served in accordance with paragraph 5 of these orders, then: (a) upon the applicant making demand, the issuing bank must pay the amount demanded into Court; and (b) upon the applicant making a request, the Registrar must not authorise payment of the amount requested out of Court unless and until further order of a Judge of the Court. 9. If a notice of objection is filed and served in accordance with paragraph 5 of these orders, then, within 7 days after filing that notice, the first, second and third respondents must: (a) file and serve a document setting out the grounds upon which objection is taken to the payment of the amount demanded to or at the direction of the applicant; and (b) any affidavits in support of the grounds of objection. 10. The parties and the National Australia Bank Limited, as intervening party, have liberty to apply on 24 hours written notice to vary or discharge these orders or for further or other orders. 11. The costs of the hearing on 16 August 2024 be costs in the cause. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT FEUTRILL J: Introduction 1 On 12 July 2024 I made orders, amongst others, dismissing an interlocutory application for summary judgment, standing over part of that application and directing the parties to file an agreed or competing minutes to give effect to paragraph [186] of the reasons for those orders: East Rockingham RRF Project Co Pty Ltd as Trustee for the East Rockingham RRF Project Trust v Acciona Construction Australia Pty Ltd [2024] FCA 759. The orders to give effect to paragraph [186] were contested. These are my reasons for not making the orders contemplated in paragraph [186], but a variation of them. These reasons are to be read with the reasons in East Rockingham RRF Project and I use capitalised terms in these reasons in the same manner as they are used, described or defined in the East Rockingham RRF Project reasons. 2 By way of background, the Employer, the applicant, applied for summary judgment to be entered against the Acciona parties, the first, second and third respondents, for breaches of terms of the EPC Contract by which the Acciona parties were required to provide replacements of Bank Guarantees that had expired in accordance with the terms of those guarantees. The Employer sought judgment in the form of a mandatory injunction to compel the Acciona parties to provide it with the replacement Bank Guarantees. The Acciona parties asserted in their concise statement in response and statement of cross-claim that the Employer is insolvent and, in those circumstances, the Employer is not entitled to the equitable relief it claims. The Employer contended that upon the uncontentious facts and on the assumption that it is insolvent, as asserted, the Acciona parties had no reasonable prospects of defending the Employer's claims. 3 For the reasons given in East Rockingham RRF Project, I was satisfied that the Acciona parties had no reasonable prospects of defending the Employer's claim that they had breached the EPC Contract. However, I was not satisfied, on the assumption that the Employer was insolvent, that the Acciona parties had no reasonable prospects of defending the Employer's claim for a mandatory injunction: East Rockingham RRF Project at [147], [179]. Separately, I observed that the practical effect of refusing the Employer's application for summary judgment for the claimed equitable relief may be to determine the proceedings finally in the Acciona parties' favour. As a consequence of the potential injustice that would result from the time it would take to determine the issues the Acciona parties have raised in their defence, I foreshadowed exercising power under s 23 of the Federal Court of Australia Act 1976 (Cth) to make orders that would have the effect of requiring the Acciona parties to provide the Employer with replacement Bank Guarantees but, to preserve the status quo, placing conditions on the Employer's right to call on the replacement Bank Guarantees and obtain legal ownership of the funds demanded, pending determination of the question of whether it is entitled to the claimed mandatory injunction and provision of the replacement Bank Guarantees: East Rockingham RRF Project at [147], [179]-[185]. 4 As to the mechanism for preserving the status quo and avoiding the potential injustice, I said: 186 Subject to hearing the parties on the final form of the orders, I will make orders along the following lines: (1) The lawyers representing the Employer and the Acciona parties in the proceeding must open a bank account with an Australian trading bank registered pursuant to the Banking Act 1959 (Cth) in their joint names (Stakeholder Account). (2) Any funds paid into the Stakeholder Account be held on trust by the account holders for the benefit of the Employer and the Acciona parties pending determination of the party entitled to the funds. (3) Any payment out of the Stakeholder Account be subject to and at the direction of the Court. (4) Upon each of the Employer and the Security Trustee undertaking to the Court that, if it has recourse to the Performance Bond, it must direct the issuer bank to pay the amount demanded under the Performance Bond into the Stakeholder Account; the Acciona parties do all things reasonably necessary to procure one or more irrevocable and unconditional bank guarantee in favour of the Employer and the Security Trustee in the form set out in Schedule 20 to the EPC Contract or in a form other approved by the Employer in the aggregate sum of AUD 38,631,149.64 and, thereafter, immediately deliver such bank guarantee(s) to the Employer (Performance Bond). 5 On 24 July 2024 after hearing the parties on the terms of further orders that should be made on the summary judgment application, I made certain declarations to the effect that the Acciona parties had breached certain terms of the EPC Contract and made orders for filing further submissions on the form of orders to give effect to paragraph [186]. I also made orders granting the National Australia Bank Limited, as Security Trustee, leave to intervene for the purpose of making submissions on the form of those orders. Written submissions were filed and served in accordance with those orders and I heard the parties and the Security Trustee regarding the form of the orders to be made on 16 August 2024. Issue 6 As identified in East Rockingham RRF Project, the principal issue of concern for the Court is the risk of injustice to the Employer, should it ultimately be determined that it is entitled to the claimed equitable relief, and the risk of injustice to the Acciona parties, should it ultimately be determined that, although in breach of contract, equity will not require it to provide the replacement Bank Guarantees to the Employer as promised. Orders of the kind foreshadowed in paragraph [186] seek to strike a balance between the relative risk of injustice that flows from refusing summary judgment and the inevitable delay that will be caused by permitting the issues raised in the Acciona parties' defence to proceed to trial. 7 In substance, the orders contemplated in paragraph [186] are in the nature of a conditional order dismissing the application for summary judgment for the equitable relief claimed and placing conditions on the terms upon which the Acciona parties' defence is permitted to proceed to trial. In other jurisdictions, orders are sometimes made granting 'leave to defend' because, although the defence has raised an issue to be tried, the defence is considered 'shadowy': e.g., Sino Iron Pty Ltd v Mineralogy Pty Ltd (No 2) [2017] WASCA 76; 55 WAR 36 at [168] (Buss P, Murphy JA and Beech J). As noted in East Rockingham RRF Project, the Court has power to make orders of that kind under s 23 of the Federal Court Act; see, also, r 1.32 of the Federal Court Rules 2011 (Cth). The Court also has power to control its own proceedings, including the terms upon which parties are permitted to raise issues in the proceedings: see, e.g., s 37M and s 37P(2) of the Federal Court Act and r 5.04 of the Rules. The Court has power to make an order subject to any conditions the Court thinks appropriate: r 1.33. The Court has power to dispense with compliance with the Rules and make orders inconsistent with the Rules: r 1.34, r 1.35. The Court also has power to exercise a power mentioned in the Rules on its own initiative and, if a party has made an application, make a different order to the order sought in the application: r 1.40, r 1.41. Summary of the parties' positions Security Trustee 8 The Security Trustee submits that orders of the kind contemplated in paragraph [186] should not be made at all. Rather, the Security Trustee submits that an unconditional order should be made requiring the Acciona parties to provide replacement Bank Guarantees in the terms the EPC Contract requires. The Security Trustee submits that an unconditional mandatory interlocutory injunction should be ordered, in substance, because there is a strong prima facie case against the Acciona parties, from the perspective of the Security Trustee, and that the balance of convenience is in the Security Trustee's favour. 9 The Security Trustee contends there is a strong prima facie case against the Acciona parties because it is the beneficiary of cl 6.7 of the EPC Contract and it is entitled to enforce it under s 11(2) of the Property Law Act 1969 (WA). It submits that the Court's concerns regarding non-performance on the part of the Employer do not apply to the Security Trustee because the Security Trustee has the right to remedy the Employer's defaults under the terms of the Financier Side Deed. The proposed conditions would frustrate the purpose of the Bank Guarantees. Further, the use of a stakeholder account to hold the funds on trust for the benefit of the Employer and the Acciona parties ignores the Security Trustee's interest in the funds as the holder of security interests. 10 The Security Trustee contends the balance of convenience favours the order it seeks because concerns about the solvency of the Employer are not relevant to it. Also, the Security Trustee has a direct right of recourse to the Bank Guarantees irrespective of the solvency of the Employer. The Acciona parties are in breach of their obligations under the EPC Contract and have not demonstrated any prejudice if the order were made. Further, if the Security Trustee made a demand under the Bank Guarantees, it would have a security interest in the proceeds. In the event of insolvency of the Employer, a question would arise, because of the security interest, as to whether the proceeds are funds available to the Employer's creditors. However, as that was what the parties to the EPC Contract contemplated at the time it was made, there is no reason for the Court to depart from that regime. The Employer 11 The Employer submits that the regime contemplated in East Rockingham RRF Project at paragraph [186] should not be put in place for two reasons. First, it imposes as conditions of the injunction conditions that would impair the Employer's and Security Trustee's contractual rights. Second, the undertaking would effectively provide the Acciona parties with an injunction restraining the Employer or Security Trustee from calling on the replacement Bank Guarantees or using the proceeds of such a call in circumstances in which the Acciona parties have not demonstrated, by evidence or other means, that such a restraint is warranted. The Employer submits that there should be an order requiring the Acciona parties to provide the Bank Guarantees and, if conditions are to be attached, the conditions should be limited to requiring the Employer and Security Trustee to give notice so as to allow the Acciona parties to then demonstrate, if they can, any reason why the call should not be made or proceeds should not be paid as the EPC Contract requires. 12 In substance, the Employer submits that the Court has determined that the Acciona parties are in breach of the EPC Contract. There is no evidence before the Court to support the Acciona parties' assertion of the Employer's insolvency upon which their defence to equitable relief is founded. At this point in the proceedings, no demand had been made for payment under any Bank Guarantees because the Acciona parties have not provided them as the EPC Contract requires. If the replacement Bank Guarantees are provided, a demand may or may not be made for payment under them in the future. In those circumstances, it is premature to put in place a regime that is intended to deal with payment if a demand is made or where the balance of convenience lies concerning which party should hold the proceeds and on what terms pending final resolution of the proceedings. In the event a demand is made, the Acciona parties should be required to demonstrate, by evidence, that their defence has a proper factual foundation to obtain a restraint against payment to the Employer. That is, the Acciona parties should bear the onus of demonstrating that the payment should not be made to the Employer as a condition of their defence proceeding to trial. Acciona parties 13 The Acciona parties embrace the suggested order in East Rockingham RRF Project at paragraph [186]. They submit that the Employer's proposal would make the replacement Bank Guarantees and proceeds, if a call were made, property of the company. That is, the replacement Bank Guarantees and proceeds would be 'property of the company' for the purposes of Pts 5.2 to 5.9 of the Corporations Act 2001 (Cth) and, thereby, available for distribution amongst its creditors in the event of insolvency of the Employer. They submit that, notwithstanding the reasons in East Rockingham RRF Project, in effect, the Employer maintains that it is entitled to final relief. The Employer's submissions presuppose an existing right to equitable relief that has not yet been determined. 14 The Acciona parties also point to difficulties that arise from orders requiring them to provide the contractual replacement Bank Guarantees without conditional payment. For example, cl 6.7(h) of the EPC Contract precludes the Acciona parties from applying to restrain a call on Bank Guarantees. They also submit that the Employer's conditions reverse the onus of proof regarding the Employer's readiness and willingness to perform its obligations under the EPC Contract. 15 As to the Security Trustee's position, the Acciona parties submit that, in effect, it seeks to obtain orders as if it were an applicant and party to the proceedings, which it is not. Its proposed order places the Employer in the position to make interim rights permanent and final rights of less or no value, which was a reason that summary judgment was refused in East Rockingham RRF Project. The Security Trustee's submissions are predicated on an assumption that the Employer (and Security Trustee) is entitled to final equitable relief, which has not yet been determined. Moreover, the Security Trustee, as a non-party, seeks to vindicate its own rights which were not part of the Employer's application. Indeed, its application was in part founded on damages not being an adequate remedy because the Security Trustee is not a party to the EPC Contract. The Security Trustee's submission that it has a direct right to recourse to the Bank Guarantees in the event of the Employer's insolvency and a security interest in the proceeds raises matters that are new and have not been the subject of evidence or submissions. 16 In substance, the Acciona parties contend that the Security Trustee's submissions are made as if it were a party entitled to the final relief denied to the Employer on summary judgment. The Security Trustee has not addressed itself to its real interest in the proceeding which is limited to its interest in the terms upon which the status quo, as between the Employer and the Acciona parties, should be preserved pending final judgment in the proceedings. Consideration 17 Regarding the Security Trustee's position, I largely accept the Acciona parties' characterisation of the Security Trustee's submissions and the Acciona parties' reasons that the Security Trustee's submissions should be rejected. 18 The Security Trustee was granted leave to intervene because the order contemplated in East Rockingham RRF Project at paragraph [186] would be conditional upon the Security Trustee giving an undertaking, in effect, to direct payment of any amount paid under the Bank Guarantees into a trust account to be held pending final determination of which of the parties is entitled to the amount paid. An undertaking from the Security Trustee would be necessary because it would be a beneficiary of the Bank Guarantees and entitled to make demand under it. Under the terms of the EPC Contract, if the Security Trustee made a demand and was paid, the Acciona parties' right to an account for any overpayment would be against the Employer, not the Security Trustee. Therefore, payment to the Security Trustee would render the Acciona parties exposed to the very risk of injustice that I considered provided the Acciona parties with reasonable prospects of defending the Employer's claims for equitable relief. 19 The Security Trustee's submissions are not directed to the relevant issue; namely, the terms upon which the Acciona parties should be permitted to advance their asserted defence in the proceedings. The Court has already determined that the Employer's case is relatively strong and no evidence, one way or the other, is before the Court concerning the Employer's solvency. As has already been mentioned, the relevant question is what is necessary to protect the Employer, on the one hand, and the Acciona parties, on the other, against the risk of injustice, if an order equivalent to an interlocutory mandatory injunction were (or were not) made and the making of (or refusal to make) such an order turns out to be the 'wrong' decision. None of the Security Trustee's submissions are directed to that question. In substance, the Security Trustee's submissions presuppose or assume that it has an independent entitlement to a final mandatory injunction and, in the meantime, the balance of convenience favours an interlocutory mandatory injunction granted in its favour. 20 The Security Trustee is not a party to the proceedings. None of the parties nor the Security Trustee submits that it should be joined as a party to the proceedings under r 9.05(1) of the Rules. The principal remaining issue in the proceedings is whether final equitable relief should be ordered in favour of the Employer, not the Security Trustee. In any event, typically, the party applying for the grant of interlocutory injunctions must proffer an undertaking that redresses the risk of the interlocutory order turning out to be 'wrong'. There is nothing in the Security Trustee's submissions to suggest that it would be prepared to give an undertaking to preserve the status quo along the lines suggested in East Rockingham RRF Project at paragraph [186]. Given the position that the Security Trustee has taken, I will not make any orders that depend upon its co-operation. 21 As to the Employer's submissions, there is significant force in the second reason, but I do not accept its first reason for not making the contemplated orders. The contractual rights of the Employer (and Security Trustee) to make a demand under the Bank Guarantees depends upon the Acciona parties providing replacement Bank Guarantees under the EPC Contract. But, the question of the Employer's entitlement to a final order for a mandatory injunction requiring the Acciona parties to perform the EPC Contract is yet to be decided. If a mandatory interlocutory injunction were granted, the Employer (and Security Trustee) would only have a contractual right to call on the replacement Bank Guarantees because of that interlocutory injunction. Therefore, the entire point of the contemplated conditions on the Employer's and Security Trustee's rights associated with calling on the Bank Guarantees is to interfere with those rights so as to mitigate against the identified risk of injustice to the Acciona parties. That is also an answer to all of the Security Trustee's substantive submissions on the effect and operation of the EPC Contract. 22 As to the Employer's second reason, as matters stand, the Acciona parties' defence is founded on assertion. The effect of my conclusions in East Rockingham RRF Project is that, assuming insolvency of the Employer were proved at trial, then the Acciona parties would have reasonable prospects of defending the Employer's claims to equitable relief. That conclusion was reached because the Employer proceeded with its summary judgment application on the basis that the Acciona parties had no reasonable prospects of succeeding on their defence even if they proved the Employer is insolvent. However, there was and is no evidence before the Court concerning the Employer's solvency or insolvency. 23 The relevant risk of a 'wrong' decision if an order were made requiring the Acciona parties to provide the replacement Bank Guarantees does not arise directly from the provision of the guarantees, but from the Employer (and Security Trustee) having a contractual right under the EPC Contract to make a demand for payment to be made under the guarantees. That risk is contingent on three matters. First, that a demand is made under the replacement Bank Guarantees and the proceeds are then paid to the Employer (or Security Trustee). Second, the Acciona parties are ultimately entitled to repayment of the whole or part of the sum paid under the Bank Guarantees. Third, due to the Employer's insolvency, the Acciona parties will not be able to recover that repayment. 24 I accept that there is no evidence before the Court to evaluate the extent of the risk of all the relevant contingencies eventuating and, therefore, the risk of a 'wrong' decision. Given that the relevant question is on what terms the Acciona parties should be permitted to defend the claims to equitable relief, it is appropriate to consider if one of the conditions imposed should be that the Acciona parties bear the onus demonstrating the factual foundation for the risk that, if a call is made, the Acciona parties will be entitled to a repayment that will go unsatisfied such that there should be a 'restraint' on the payment of the proceeds under the replacement Bank Guarantees to the Employer (or Security Trustee). 25 Where a bank guarantee is provided under a construction contract and a demand is made for payment, the circumstances in which a court will restrain the person entitled to make demand from so doing are rare: see, e.g., Simic v New South Wales Land and Housing Corporation [2016] HCA 47; 260 CLR 85 at [2], [5]-[8] (French CJ), Clough Engineering Ltd v Oil and Natural Gas Corporation Ltd [2008] FCAFC 136; 249 ALR 458 at [75]-[85] (French, Jacobson and Graham JJ). Here, the difficulties for the Acciona parties restraining a demand are compounded by cl 6.7(h) of the EPC Contract. Thus, if an order were made requiring the Acciona parties, in effect, to perform their contractual obligations to provide the replacement Bank Guarantees, it may create significant difficulties for the Acciona parties to demonstrate a ground upon which the Employer (or Security Trustee) could be restrained from making a demand on the replacement Bank Guarantees. 26 There is also uncertainty concerning the question of whether Bank Guarantees provided under the EPC Contract, the entitlement to payment under them, and the proceeds paid under them as a consequence of a call, would be 'property of the company': e.g., Hastie Group Ltd (in liq) v Multiplex Constructions Pty Ltd (No 3) [2022] FCA 1280; 410 ALR 531 at [371]-[375]. The character of proceeds as 'property of the company' or security interest in them may not be affected by payment of those proceeds into a stakeholder account or into Court where the source of the proceeds is derived from an unconditional right to payment of the funds under a bank guarantee and that right is 'property of the company'. 27 It follows that difficulties establishing a contractual or other right to restrain a call on the Bank Guarantees and uncertainty regarding the extent to which interlocutory orders of the Court could alter underlying proprietary rights associated with the proceeds of the Bank Guarantees, are all matters that have the potential to defeat the purpose of placing conditions on any order requiring the Acciona parties to provide the replacement Bank Guarantees. At the least, these matters create uncertainty regarding whether the Acciona parties would be entitled to apply for and what factors they would be permitted to raise in applying for a restraint on the unconditional payment to the Employer of the proceeds of the replacement Bank Guarantees or the entitlement of the Employer to the proceeds of the Bank Guarantees. 28 As mentioned at the outset, the purpose of making orders of the kind referred to in East Rockingham RRF Project at paragraph [186] is to place conditions on the terms upon which the Acciona parties should be permitted to defend the Employer's claims for equitable relief. The order contemplated in paragraph [186] was aimed at achieving the objective of preserving the parties' positions with minimal interference to the contractual provisions. I am persuaded that the order contemplated in paragraph [186] is not appropriate as framed. 29 Given the Security Trustee's position, the force of the Employer's submissions, and the difficulties that provision of the contractual replacement Bank Guarantees may create for preserving the status quo if a demand for payment were made, I am of the view, that the better course is to require the Acciona parties to provide a separate form of security as a condition of permitting their defence to proceed to trial. Those terms will include a mechanism by which the security will be payable to the Employer if a demand is made in circumstances in which it is entitled under the EPC Contract to demand payment under Bank Guarantees provided under that contract, unless the Acciona parties object to such payment and are able to demonstrate, by evidence or other means, that the balance of convenience favours the Court holding the funds pending final judgment in the proceedings. 30 The parties will have liberty to apply to vary or set aside the orders. The orders are not intended to preclude the parties agreeing a variation to the orders to give better effect to them from the perspective of the parties or to the Security Trustee participating in them should it wish to do so. I certify that the preceding thirty (30) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Feutrill. Associate: Dated: 4 September 2024 SCHEDULE OF PARTIES WAD 72 of 2024 Respondents Fourth Respondent: ACCIONA INDUSTRIAL AUSTRALIA PTY LTD ACN 620 692 784 Fifth Respondent: HITACHI ZOSEN INOVA AUSTRALIA PTY LTD ACN 603 901 382