WINROBE PTY LTD v SUNDIN'S BUILDING COMPANY PTY LTD [1992] NSWCA 277

WINROBE PTY LTD v SUNDIN'S BUILDING COMPANY PTY LTD

SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

KIRBY P, SHELLER and Cripps JJA 6 April 1992, 15 June 1992 [1992] NSWCA 277

CONTRACT — building and design — erection of building on right of carriageway purported termination of contract ineffective — obligation of builder to exercise due care and skill includes not to tender design encroaching right of carriageway — each party liable to other.

DAMAGES — building contract ineffective termination by owner — failure of builder to perform work with due care and skill — calculation of damages — proper approach to.

WORDS and PHRASES — "continue" — "liaise".

CONTRACT — building contract — building contractor undertakes to "design and construct" works — agrees to undertake further design work to obtain consents from authorities — original design provided by principal envisages construction of building on neighbour's right of carriageway — principal's solicitor alerts principal to right of carriageway — solicitor's letter sent to contractor with request to "liaise" with solicitor contractor assumes principal has reached agreement with neighbour — submits design plan involving building on right of carriageway — building erected — necessity to bring proceedings to extinguish right of carriageway following delay in proceedings, progress payments to contractor cease — principal purports to give notice terminating contract for alleged failure to proceed with the project with due diligence or in a competent manner contractor purports to terminate contract for failure of principal to pay progress claims — principal engages another builder to complete development — contractor sues principal for damages

DAMAGES — building dispute — building erected on right of carriageway pursuant to design proposed by contractor to principal based upon design proposal made by principal to contractor — purported termination of contract by notice found to be ineffective — trial judge finds principal in breach of contract to contractor and contractor in breach of warranty to proceed with building with due diligence and in a competent manner — proper approach to contract allowance for profit — avoidance of over-compensation where contract is a loss contract — The Commonwealth v Amann Aviation Pty Ltd (1991) 66 ALJR 123