David Hurst Constructions Pty Ltd v Shorten [2008] NSWSC 164

New South Wales Supreme Court

CITATION : David Hurst Constructions Pty Ltd v Shorten [2008] NSWSC 164

HEARING DATE(S) : 08.02.08

JUDGMENT DATE : 4 March 2008

JUDGMENT OF : Nicholas J

DECISION : Par 29

CATCHWORDS : CONSTRUCTION – CONTRACT – whether Building and Construction Industry Security of Payment Act 1999 applies – whether construction contract within s 7(2)(b) – statutory construction – whether claimant entitled to payment claim – claimant's application for summary judgment under Uniform Civil Procedure Rules 2005, Pt 13, r 13.1

Building and Construction Industry Security of Payment Act 1999 LEGISLATION CITED : Home Building Act 1989 Interpretation Act 1987 Uniform Civil Procedure Rules 2005

CATEGORY : Principal judgment

CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2; (1997) 187 CLR 384 CASES CITED : Network Ten Pty Ltd v TCN Channel Nine Pty Ltd [2004] HCA 14; (2004) 218 CLR 273 Vigolo v Bostin [2005] HCA 11; (2005) 221 CLR 191 Walter Construction Group v CPL (Surry Hills) Pty Ltd [2003] NSWSC 266

David Hurst Constructions Pty Ltd - plaintiff PARTIES : Richard William Shorten – first defendant Lorraine Shorten – second defendant

FILE NUMBER(S) : SC 55090/07

COUNSEL : G A Sirtes – plaintiff M Christie/C P Carter - defendants

SOLICITORS : The Builders' Lawyers – plaintiff Pilley McKellar Pty Ltd – defendants

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION TECHNOLOGY & CONSTRUCTION LIST

Nicholas J

4 March 2008

55090/07 David Hurst Constructions Pty Ltd v Shorten & Anor JUDGMENT 1 His Honour: These proceedings concern the plaintiff's entitlement to recover from the defendants the amount of $272,649.77, and interest, under a contract for the construction of a complex of 10 residential units on the premises at xx xx Street, Wagga Wagga (the premises). 2 By its notice of motion filed 3 December 2007, the plaintiff seeks summary judgment under the Uniform Civil Procedure Rules 2005, Pt 13, r 13.1 for the amount claimed as a consequence of the defendants' failure to reply to its payment claim in accordance with the provisions of s 14 and s 15 of the Building and Construction Industry Security of Payment Act 1999 (the Act). 3 The defendants challenge the plaintiff's claim for summary judgment on the basis that the contract under which the work was carried out is not one to which the Act applies, contending that it is a contract within the meaning of s 7(2)(b) of the Act. 4 The questions for consideration are, firstly, the proper construction of s 7(2)(b), and secondly, whether on the evidence, the contract in this case is one to which the Act applies. Background 5 The following history was undisputed and shows the circumstances in which the claim arises. 6 The plaintiff is a builder. The defendants are the owners of the premises. 7 On about 22 January 2006 the parties entered into a contract whereby the plaintiff agreed to build for the defendants on the premises a complex of 10 residential units with common facilities including a gymnasium, meeting room, and gardens. The contract sum was $4,250,533.64. The contract described the project as "Serenity Luxury Apartments". The written form of the contract was executed in May 2006. 8 At the time of the hearing the court was informed that the construction of the complex was almost complete, and was at a stage where the plaintiff was no longer working on the premises. 9 On 21 October 2007 the plaintiff served progress claim no. 17 for the amount of $272,649.77, purportedly as a payment claim under s 13 of the Act. The defendants did not provide a payment schedule within 10 business days after service of the payment claim under s 14. The amount claimed remains unpaid. 10 Since the time the contract was made, it has been the defendants' intention to live in unit xx as their permanent residence, and this intention remains. The first defendant, Mr Shorten, gave oral evidence that he informed Mr Hurst, the plaintiff's director, of this intention either at the end of 2005 or the beginning of 2006 prior to 22 January 2006 when the contract was entered into. Nevertheless, although the existence of the intention is undisputed, it is common ground that Mr Hurst does not accept Mr Shorten's evidence as to when he was informed of it.