VAROO PTY LTD v MULTIPLEX CONSTRUCTION PTY LTD SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL KIRBY P, PRIESTLEY CLARKE JJA 18 and 22 February 1991, 22 February 1991 [1991] NSWCA 274 KEY WORDS: Appeal — arbitration — leave to appeal — construction of agreement — question not ripe APPEAL — leave to appeal — Court of Appeal — grounds for allowing or declining — building arbitration case — held: (1) The Court will not normally give leave to appeal to correct the reasons of the judge appealed from but to correct the decision; (2) The Court in the present case would decline leave as the issues were not concrete but largely hypothetical. ARBITRATION — building arbitration — cost plus contract variation clause — need for "substantial variation" to the "scope of the works" — arbitrator makes interim award Cole J grants leave to appeal — confirms award — application for leave to appeal to the Court of Appeal — held: (declining leave and dismissing summons) (1) The Court will not normally give leave to appeal to review the reasons of the judge appealed from but to correct the decision challenged; (2) In the present case, the decision of Cole J, affirming the interim award of the Arbitrator, was not shown to be incorrect; (3) Appellate review, if any, should be postponed until the Arbitrator had determined the application of the variation clause to concrete claims. Kirby P (expressing the reasons and orders of the Court): The Court declines leave to appeal from the order of Cole J dismissing an appeal which was, in turn, brought, by his Honour's leave, from an interim award of Mr G L Lumsdaine, Arbitrator. The Court will not usually grant leave to appeal to correct the reasons of a judge leading to his or her decision. Leave to appeal is usually given to permit the Court, on appeal, to correct the decision appealed from. In this case, Cole J dismissed the appeal from the Arbitrator's interim award. In providing his reasons for taking that course, his Honour made a number of observations about the meaning of the contract between the parties which have been criticised by the claimant. Some of his Honour's observations may have gone beyond what it was necessary for him to say to reach the conclusion which he reached. In dismissing the summons for leave to appeal, this Court is not necessarily endorsing all of the reasons given by Cole J for the order which he made. It may be necessary or desirable at a later time, to return to a consideration of those reasons and the construction of the contract there stated. The result of Cole J's order is to confirm the conclusion stated in para 1.15 of the Arbitrator's interim award. In that paragraph the Arbitrator stated: "1.15 Tam of the opinion that pursuant to CL29, a SUBSTANTIAL VARIATION can arise from an agglomeration of changes to the scope of the works as shown in the Drawings and referred to in Cost Plan 4A, beyond that contemplated by the parties at the date of the Contract." The Court understands "can" in this paragraph to mean "may" and not to indicate that every variation is necessarily to be included in a relevant agglomeration of changes to the scope of the works. 2 UNREPORTED JUDGMENTS The Court does not consider that there is sufficient doubt about the correctness of the Arbitrator's statement, so understood, as to warrant the grant of leave to appeal from the order of Cole J in turn dismissing a challenge to it. The parties will now return to the Arbitrator who has set aside three weeks, re-commencing on Monday next, for the hearing of the arbitration. The Arbitrator will proceed to consider the various claims by the builder in respect of variations, measuring each of them against the requirements of CL29 of the contract. He will reach conclusions in each case which will eventually result in a final award. This may then present a decision which will pose questions concerning the interpretation and application of CL29 which are concrete. Such questions would be more susceptible of appellate review than the issue tendered by the claimant on this summons which has required the meaning of the contract to be dealt with largely on a hypothetical basis. The summons is dismissed. The claimant must pay the opponent's costs. Summons for leave to appeal dismissed with costs. Counsel for the Claimant: BS J O'Keefe QC / I Faulkner Counsel for the Opponent: RS Hulme QC / MG Rudge Solicitors for the Claimant: Dunhill Maddern and Butler Solicitors for the Opponent: Cowley Hearne