Australia: Construction & Infrastructure News – 17 January 2018

Last Updated: 18 January 2018
Article by Troy Lewis, Stephen Burton, Suzy Cairney, Stephen Natoli, Kyle Siebel, Scott Alden, Christine Jones and Helena Golovanoff

Most Read Contributor in Australia, August 2018

In the media – National

Federal Government baulks at subcontractor protection on Commonwealth projects
The Australian government has baulked at recommendations to afford greater protections to subcontractors and suppliers on Commonwealth government projects (10 January 2018). More...

MBA: Rise in approvals points to positive year for construction in 2018
Total dwelling approvals increased by 0.9% in seasonally adjusted terms in November 2017, adding a tenth consecutive month of positive growth in the approvals data (09 January 2018). More...

Renewable energy to power Stawell Farm a "world's first"
The Victorian State government has stated that it will build a major new wind farm with battery storage in Western Victoria that will power the expansion of Stawell's Nectar Farms (08 January 2018). More...

Solar research gets $29.2m boost
Australian solar cell research has received a $29.2 million boost from the Australian Renewable Energy Agency, and UNSW has 11 of the 22 projects (20 December 2017). More...

Snowy 2.0 feasibility study released
The study released today states the project is technically feasible, and estimated to cost between $3.8-4.5 billion. According to the project timeline set out in the study, Snowy 2.0 could be providing first power by late 2024 (20 December 2017). More...

PM names new infrastructure minister
Deputy Prime Minister Barnaby Joyce has taken over the Australian Government's Infrastructure and Transport portfolio after a Federal cabinet reshuffle was announced by Prime Minister Malcolm Turnbull. Mr Joyce will now be responsible for the Australian Government's multi-billion-dollar inland rail project (19 December 2017). More...

In the media – Victoria

Dumped Melbourne road re-appears on radar
The East West Link, a toll road controversially dumped by the Victorian government at a cost of $1.2 billion, has re-emerged in a list of possible future projects (11 January 2018). More...

CPB Contractors wins $312 million Metro Tunnel rail works
CPB Contractors, as part of the Rail Systems Alliance (RSA), has been awarded works by the Victorian Government in support of the $11 billion Metro Tunnel Project, the state's biggest ever investment in public transport. Construction as part of the RSA is expected to commence in 2018 and be completed by 2026 (10 January 2018). More...

New building fire safety laws come into force
New laws to enhance fire safety in high-rise buildings will come into force today, Minister for Better Regulation Matt Kean said. Under the Building Products (Safety) Act 2017, the government can ban building products – for example, external wall cladding – from being used in unsafe ways (18 December 2017). More...

In the media –New South Wales

Home buyers to be better protected by Australian-first defect bond scheme
The Strata Building Bond and Inspections Scheme (the Scheme), the first of its kind in Australia, provides a structured process to rectify defects early in the building lifecycle. Developers will now be required to lodge a building bond, which is equal to two per cent of the contract price with NSW Fair Trading. For more information about the Strata Building Bonds and Inspection Scheme, go to www.fairtrading.nsw.gov.au (01 January 2018). More...

Update on the Fire Safety and External Wall Cladding Taskforce
Six months on, the Cladding Taskforce, comprising representatives from the Department of Finance, Services and Innovation (DFSI), the NSW Data Analytics Centre (DAC), the Department of Planning and Environment (DPE), Fire & Rescue NSW (FRNSW), the Office of Local Government (OLG), Treasury and the Department of Premier and Cabinet (DPC), has worked to address concerns over fire safety risks arising from the use of aluminium cladding on buildings in NSW (15 December 2017). More...

In the media – Queensland

Sunshine Coast dam upgrade a step closer
Seqwater's $80 million upgrade of the Sunshine Coast's Six Mile Creek Dam is a step closer to creating 100 local jobs after gaining special "coordinated project" status (22 December 2017). More...

Development application for Queen's Wharf Brisbane approved
The $3 billion Queen's Wharf Brisbane integrated resort development is now one step closer after Economic Development Queensland this week approved Destination Brisbane Consortium's Plan of Development application (21 December 2017). More...

Published

Energy resources: a quick guide
Adrian Makeham-Kirchner; Parliament of Australia research Papers: 18 December 2017
This quick guide provides a list of key Australian sources, and some high level international resources, that assist in understanding the Australian energy market. This guide does not outline parliamentary resources, such as chamber records or committee inquiries. More...

Australian Bureau of Statistics
09 January 2017 - Building Approvals, Australia, Nov 2017 (cat no. 8731.0).

Practice and courts

ABCB: Adoption of NCC 2016 Volume One Amendment 1 - Key dates

19 January 2018 - The ABCB will release a preview of NCC 2016 Volume One Amendment 1 and the new Evidence of Suitability Handbook.
12 March 2018 - NCC 2016 Volume One Amendment 1 is scheduled for adoption by all States and Territories from 12 March 2018.
This amendment is the result of a Building Ministers' direction to the ABCB to expedite completing and adopting actions involving changes to the NCC from a comprehensive package of measures for fire safety in high rise buildings developed following the Lacrosse Apartments fire in Melbourne.

Victoria

VBA: The importance of regularly maintaining your balcony
The collapse of a balcony in Doncaster East on the weekend is a tragic reminder of the importance of regularly maintaining your balcony or deck (18 December 2017). More...

New South Wales

Can NSW's green infrastructure policy stop canopy cover decline?
NSW's government architect has released a draft policy that aims to put green infrastructure at the heart of city-making. Submissions on the draft plan are being accepted until 2 February 2018. More...

Queensland

QBCC: Notifiable work resources
QBCC wants to increase awareness about Notifiable Work and have developed some resources to help plumbers, home owners and real estate agents (03 January 2018). More...

Building Industry Fairness (Security of Payment) Bill 2017
The State Parliament has passed the Building Industry Fairness (Security of Payment) Bill 2017. A two-stage adoption process will see the requirement for mandatory PBAs rolled-out across Queensland. An initial stage, to being on 1 January 2018, will see the requirement applied to government building and construction projects. A second stage, to begin 1 January 2019, will expand the application of the mandatory PBA to all building and construction projects over $1 million.

Cases

Ottoway Engineering Pty Ltd v Westpac Banking Corporation (No 3) [2017] FCA 1500
PRACTICE AND PROCEDURE – consideration of an application by the applicant seeking orders to prevent the respondent from enforcing a guarantee – where the applicant was the subcontractor on a construction project – where the applicant's bank provided a guarantee to the main contractor's bank – whether the guarantee secures the applicant's obligations to the main contractor under a separate agreement – whether the guarantee secures the main contractor's obligations to its bank.
BANKING AND FINANCIAL INSTITUTIONS – consideration of the proper construction of the guarantee – where the guarantee is in the nature of a performance bond or demand guarantee and not a contract of suretyship – where the true nature of the document is to be ascertained from its terms and conditions – where the guarantee was provided by the applicant's bank to the main contractor's bank – where there is no underlying agreement between the applicant and the respondent – where the guarantee places a primary obligation on the applicant's bank to pay to the respondent the amount specified in a written demand in accordance with the guarantee – where the obligation under the guarantee is independent of the underlying agreements between the applicant and the main contractor.
CONSUMER LAW – whether the respondent engaged in misleading or deceptive or unconscionable conduct under the Australian Consumer Law in procuring or enforcing the guarantee – where the applicant sought to rely on what it claimed was a species of unconscionable conduct that arises where the assertion or reliance on a legal right is, in the circumstances, unconscionable – where there is very limited scope for holding unconscionable conduct in a case involving a performance bond or demand guarantee – where the respondent had no obligation to make further inquiries into the conduct of the main contractor before calling on the guarantee – where the respondent was not bound to pursue repayment of the amount secured by the guarantee through a term deposit also held by the respondent – where the respondent was entitled to take immediate action on the guarantee.

Hancock Prospecting Pty Ltd v Rinehart (No 2) [2017] FCAFC 208
ARBITRATION – stay of proceeding brought in Court in favour of arbitration – making of orders. COSTS – appropriate order for costs – whether costs of stay application below and on appeal should follow the event – whether costs below and on appeal should be payable forthwith. Commercial Arbitration Act 2010 (NSW), s.8.

Quickway Constructions Pty Ltd v Electrical Energy Pty Ltd [2017] NSWCA 337
Appeal allowed. BUILDING AND CONSTRUCTION – claims for progress payments under Building and Construction Industry Security of Payment Act 1999 – underlying contractual debts assigned – whether payment claims valid – whether adjudication determinations valid. Building and Construction Industry Security of Payment Act 1999 (NSW), ss 4, 8(1), 13, 14, 15, 16, 17, 22, 25, 32. Conveyancing Act 1919 (NSW), s.12; Supreme Court Act 1970 (NSW), s.101(2)(r).

CPB Contractors Pty Ltd v Rizzani De Eccher Australia Pty Ltd [2017] NSWSC 1798
Dismiss the defendant's motion for a stay of the proceedings.
CONTRACT – Interpretation – Whether "urgent" in "urgent injunctive or declaratory relief" is to be read distributively so as also to qualify "declaratory relief"
ESTOPPEL – Equitable estoppels – Promissory estoppel – Relief. Corporations Act 2001 (Cth), s 248G; International Arbitration Act 1974 (Cth), s.7(2).
This is a dispute between parties to an unincorporated joint venture for the undertaking of design and construction works (the Works) in connection with the widening of the M4 motorway in Sydney. The dispute relates to whether the defendant (Rizzani de Eccher Australia Pty Ltd, to whom I will refer as RdE) is bound to pay a Called Sum of $8.5m for the purposes of the joint venture (the Called Sum Dispute).

Nutek Constructions Pty Ltd v Slotwinski (No 2) [2017] NSWSC 1814
Freezing order granted. CIVIL PROCEDURE – Interim preservation – Freezing orders. Home Building Act 1989 (NSW); Uniform Civil Procedure Rules 2005 (NSW) r.25.14.

Nutek Constructions Pty Ltd v Slotwinski [2017] NSWSC 1795
Freezing order set aside. INJUNCTIONS – freezing order obtained ex parte in aid of proceedings at NCAT – whether material matters not disclosed – whether freezing order should be set aside - Home Building Act 1989 (NSW).

Metricon Homes Pty Ltd v Great Lakes Insurance SE [2017] VSC 749
INSURANCE – Builder's liability insurance – Combined cover provided for products and public liability – Insured entered into contract for design and construction of house – House sustained damage arising from the Insured's defective design and workmanship – Insured claimed indemnity from Insurer for rectification costs, legal costs and settlement sum paid to home owners – Insurer denied liability on the basis that damage arose out of the Insured's contractual breaches and not out of 'damage to property' of third parties as required by insuring clause – Whether 'damage to property' of third parties included house – James Longley & Co Ltd v Forest Giles Ltd [2001] EWCA Civ 1242 distinguished – Held: Damage to property included damage to house and insuring clause applied.
INSURANCE – Builder's liability insurance – Exclusion clauses – Professional services exclusion – Whether Insured rendered a professional service – Meaning of professional service in exclusion – Insured's responsibility for design included engineering design of concrete slab and roof trusses – Insured rendered design services through professional subcontractors – Design deficiencies were a principal cause of damage to property – Definition of Insured included subcontractors – Held: Professional services exclusion applied – Held: Claim dismissed on this basis – Chubb Insurance Company of Australia Ltd v Robinson [2016] FCAFC 17; (2016) 239 FCR 300; Speno Rail Maintenance Australia Pty Ltd v Hammersley Iron Pty Ltd [2000] WASCA 408; (2000) 23 WAR 291 applied.
INSURANCE – Exclusion clauses – Inconsistency and overlap between applicable exclusions – Insurer contended that each exclusion clause operated independently of other exclusion clauses and should be construed in isolation – Inconsistency between overlapping exclusion clauses resolved by applying ordinary contractual interpretation principles – Held (by obiter dicta): Applicable exclusions can be given congruent operation when read as a whole – Statements in D K Derrington and R S Ashton, The Law of Liability Insurance (LexisNexis Butterworths, 3rd ed, 2013) vol 2, 1834 [10–7] not accepted – Result reached by applying ordinary contractual interpretation principles – Re Media Entertainment & Arts Alliance; ex parte Hoyts Corp Pty Ltd [1993] HCA 40; (1993) 178 CLR 379, 386–7; Tsolon Investments Pty Ltd v Waffle Pod Footing Systems NSW Pty Ltd [2002] NSWCA 302 [36]; Darlington Futures Ltd v Delco Australia Pty Ltd [1986] HCA 82; (1986) 161 CLR 500, 507–11 applied.
INSURANCE – Builder's liability insurance – Products liability – Policy defined 'Insured's Products' – Whether house constructed by builder fell within definition – Exclusion clause relating to 'Insured's Products' – Held: house fell within ordinary meaning of definition.

Dedert Corporation v United Dalby Bio-Refinery Pty Ltd [2017] VSCA 368
BUILDING CONTRACT – Appeal – Respondent seeking recourse in respect of claim for unliquidated damages for breach of contract – Refusal to grant interlocutory injunction to restrain respondent from exercising recourse to a commercial guarantee – Construction of contract – Whether trial judge erred in construing that contract did not contain restriction on right to have recourse to the guarantee – Whether money due and payable under the contract – Appeal allowed – Contract precludes recourse to guarantee – RCR O'Donnell Griffin Pty Ltd v Forge Group Power Pty Ltd (rec and mgr appt) (in liq) [2016] QCA 214 applied - Bachmann Pty Ltd v BHP Power New Zealand Limited [1998] VSCA 40; [1999] 1 VR 420 distinguished – Fletcher Construction Australia Limited v Varnsdorf [1998] 3 VR 812 – distinguished.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

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Authors
Suzy Cairney
Kyle Siebel
Scott Alden
Christine Jones
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