Supreme Court New South Wales Medium Neutral Citation: CPB Contractors Pty Ltd & Ors v Heyday5 Pty Ltd & Ors (No 2) [2020] NSWSC 1404 Hearing dates: On the papers Date of orders: 13 October 2020 Decision date: 13 October 2020 Jurisdiction: Equity - Technology and Construction List Before: Stevenson J Decision: Earlier orders confirmed Catchwords: CIVIL PROCEDURE – payment into court – party seeks leave to substitute cash with an unconditional bank guarantee Legislation Cited: Building and Construction Industry Security of Payment Act 1999 (NSW) Cases Cited: CPB Contractors Pty Ltd & Ors v Heyday5 Pty Ltd & Ors [2020] NSWSC 1385 Category: Consequential orders (other than Costs) Parties: CPB Contractors Pty Ltd (First Plaintiff/Applicant) Dragados Australia Pty Ltd (Second Plaintiff/Applicant) Samsung C & T Corporation (Third Plaintiff/Applicant) Heyday5 Pty Ltd (First Defendant/ Respondent) David Francis (Second Defendant) Resolution Institute (Third Defendant) Representation: Counsel: D Hume (Plaintiffs) F Hicks SC (Defendant) Solicitors: MinterEllison (Plaintiffs/Applicants) Kreisson (First Defendant/Respondent) File Number(s): 2020/260298 Judgment 1. Yesterday I published a judgment with my reasons for ordering that the plaintiff, CPB, could substitute an unconditional bank guarantee for the funds it has paid into court pending the hearing of its challenge to a determination made under the Building and Construction Industry Security of Payment Act 1999 (NSW). [1] 2. Following publication of that judgment, the defendant, Heyday, sought leave to make further submissions. I granted that leave. 3. Heyday submitted: "…Heyday has requested in correspondence prior to the motion being filed, the terms of the bank guarantee or bank guarantees should be disclosed before any substitution is considered or allowed. This is to ensure that the bank guarantee or guarantees are indeed "unconditional". This matter should not be left to the Registry to determine, as is contemplated by the orders proposed by CPB. … Heyday has numerous concerns as to the proposed substitution given the complete lack of information or detail as to the security to be obtained: (a) the proposal contemplates that numerous bank guarantees may be obtained; (b) there is no indication as to which institution or institutions have been approached for the provision of a bank guarantee (if any), or the terms upon which any bank guarantee might be provided; (c) to the extent that a financial institution requires the deposit of cash equivalent to the amount secured by the bank guarantee, the substitution of security does not assist the cashflow of CPB or any of the Plaintiffs; (d) if no deposit of an equivalent amount in cash is required for the issue of a bank guarantee, practical experience is that a financial institution will not immediately pay the amount secured by the bank guarantee (notwithstanding its terms) but will seek to secure its position and, in the interim, will delay or avoid releasing the funds; (e) ultimately, if any financial institution refuses to release the funds pursuant to a bank guarantee for any reason, Heyday would have to take separate proceedings to obtain payment with the consequent further delays in payment and further costs." 1. In my opinion, the answer to these submissions is set forth in the submissions of CPB's counsel that I set out at [9] of yesterday's judgment. 2. I have no doubt that this Court's Registry can recognise whether any bank guarantee sought to be lodged by CPB in substitution for the cash paid in court is or is not "unconditional". 3. I see no reason to alter the orders I made yesterday. ********** Endnote 1. CPB Contractors Pty Ltd & Ors v Heyday5 Pty Ltd & Ors [2020] NSWSC 1385. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 13 October 2020