Kaloriziko Pty Ltd as trustee for Ryde Combined Unit Trust v Calibre Construction Group Pty Ltd

2025/00261209

CONTRACT – on 30 November 2017, Calibre Construction Group Pty Ltd (the first respondent, referred to as the Builder) entered into a Design and Construct Contract (the Contract) with Kaloriziko Pty Ltd (the first appellant, referred to as the Developer) – by the Contract, the Builder agreed to design and construct on land owned by the Developer in Ryde – the contract sum was $31 million – the Contract provided for the Developer to retain five per cent of the contract sum (the Retention) as security, and for the Retention to be paid to the Builder over a period of 12 months after the issue of a certificate of practical completion – the Contract provided that the Retention was to be “held in trust” by the Developer for the Builder until such time as either party became entitled to the retained funds – the Builder claimed $1.6 million plus interest from the Developer in relation to the Retention – the Builder also claimed $270,000 for unpaid variations as per Clause 36 of the Contract – the Developer denied liability for these amounts and maintained that the payment or approval was made “on account” and did not indicate agreement to vary the Work Under Contract (WUC), entitling the Builder to payment beyond the $31 million contract sum – the Developer, by way of cross-claim, sought to recover amounts paid for variations and claimed damages for alleged delay and defective work by the Builder – under the Contract, the Developer was entitled to liquidated damages of $7,500 per day for any delay beyond the date for practical completion – the dispute regarding delay between the parties centred on whether the contractual date for practical completion was 20 April 2020 or 23 May 2020 – it was common ground that practical completion was actually achieved on 15 September 2020 – prior to the hearing, the Builder settled claims against some of the defendants by a Deed of Agreement and Set Off (the Deed) – the Deed involved transferring residential lots in Arncliffe for $5 million – the Developer contended that the sale was $2.9 million less than the true value and that the effect of the Deed was to discharge any liability owed by the defendants to the Builder – the Developer claimed that the settling parties had coordinate liability to the Builder for the Developer’s contractual debts – further, the Developer claimed that the transfer of residential lots was at an undervalue such that the Builder achieved a benefit – the primary judge held that because the Developer had “approved” or paid the variations, it had agreed to vary the WUC, and it was not open to the Developer to challenge this approval by contending that the approval was “on account” only – the primary judge was not persuaded that the effect of the Deed was to cause a discharge of any coordinate liability to the Builder – whether the primary judge should have found that Clause 36 of the Contract required strict compliance with its terms to vary the WUC – whether the primary judge erred by failing to give reasons as to whether the Builder and the Developer had varied the contract to exclude the costs of consultants’ fees such that V0044 “Consultants” claimed by the first respondent in the Redfern Schedule operated to vary the WUC – whether the primary judge erred in finding that his Honour had to determine what benefit the Builder received by reason of its entry into the Deed, including what was the value to the Builder of its surrender of its claims against Mr Tran (the second respondent) and Ninth Campsie Pty Ltd (the third respondent) or the surrender of its 37A claim against the third respondent – whether the primary judge incorrectly rejected the contention that the effect of the Deed was to cause a discharge of any coordinate liability as between the Mortgagors and the Developer as owing to the Builder – whether the primary judge failed to make a finding as to the value of the Arncliffe Properties as at February 2024, or alternatively, give reasons for why he could not form a conclusion as to the value of these properties – whether the primary judge should have determined the value of the Arncliffe Properties as at February 2024 as $7,906,613.00.