Bower Enterprises Pty Ltd v Coastal Constructions Pty Ltd & Anor [1990] QSC 140

r···· I , J '· 10 20 30 40 50 60 IN THE SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION No. 36 of 1990 BEFORE MR. JUSTICE de JERSEY TOWNSVILLE, 20 APRIL 1990 (Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Chief Court Reporter,Court Reporting Bureau.) BETWEEN: BOWER ENTERPRISES PTY. LIMITED -and- COASTAL CONSTRUCTIONS PTY. LTD. -and- CAIRNS FESTIVAL FAIRE PTY. LTD. ORDER Plaintiff First Defendant Second Defendant HIS HONOUR: The first defendant has applied for an order that the specially endorsed writ of summons in the action be struck out wholly or in part. By that writ the plaintiff claims approximately $240,000 said to be owing for work done by the plaintiff for the first defendant under two construction contracts, and the same amount from the second defendant in reliance on the Sub-contractors Charges Act. Mr. Baulch, who appears as counsel for the first defendant, has submitted that the claims against the first defendant are merely claims brought-on.a disgui~~d quantum meruit basis. and that the endorsement should therefore not be regarded as a true special endorsement, and that it should be struck out. "' " 1 "-Govt. Printer, Qld. 1 10 20 30 40 50 60 -- 1 of 6 -- 10 20 30 40 50 60 When one looks at the endorsement it looks like a special endorsement of a claim for·a liquidated demand in money in terms of 0.6 r.7. For his submission Mr. Baulch took me, however, to Clause 4(a) in particular of the contract between the plaintiff and the first defendant, a copy of which is Exhibit PH2 to the affidavit of Peter James Hayes filed on 12 April 1990. Mr. Baulch invited me to look at that affidavit within my inherent jurisdiction to do that in order to see whether the endorsed claim is invalid, as it were, and therefore liable to be struck out. The point made under Clause 4(a) is that the plaintiff has not alleged that the sums for which it sues had been paid by the second defendant as employer or principal contractor to the first defendant as the plaintiff's sub-contractor's head contractor. Clause 4(a) provides in short that the entitlement of the plaintiff to progress payments depends upon the requisite sum having first been paid to the head contractor by the employer. I think it is implied in paragraphs nine and 10 and paragraphs 18 and 19 of this endorsement that requisite conditions precedent have been satisfied. I do not think that the point made with reference to Clause 4(a) is so clearly against the plaintiff that the writ should be struck out. Indeed other matters apart - and I have referred to them - it is not perfectly plain to me that it is even progress payments which are being sued for here, rather the claim is for the total amount owing at the end of the work, so that the applicability of Clause 4 is on that ground alone doubtful. But as I have said, I rest my decision in the end on the view that those paragraphs of the <> ~- • ~1v1. Printer, Qld. 2 10 20 30 40 50 60 -- 2 of 6 -- 10 20 30 40 50 60 endorsement carry with them at least the implied assertion that relevant conditions precedent have been satisfied. Another point was taken in relation to the claim under the Sub-contractors Charges Act and that is that there is no assertion that not only did the second defendant not pay the amount of the claim of charge but in addition that it failed to make satisfactory arrangements for paying the amount claimed in terms of s.12 of the Sub-contractors Charges Act. Again however that refers to a condition precedent to the right to sue for the amount of the charge. Subsection 1 provides that where the recipient of the notice does not pay or make satisfactory arrangements for paying then the person in the position of this plaintiff may recover the amount of the charge from the employer. This is a claim for recovery of the amount of the charge. I do not regard the absence of an allegation that not only was that amount not paid but that in addition satisfactory arrangements for payment were not made as a fatal defect in the endorsement. So that on this basis as well I would not be prepared to strike out the writ. I therefore refuse the application for striking out of the writ contained in paragraph one of the summons. G ?14-1',vt. Printer, Qld. ~. 3 10 20 30 40 50 60 -- 3 of 6 -- 10 20 30 40 50 60 HIS HONOUR: I now turn to the first defendant's application for an order that the action be stayed. That application is made under s. 10 of the Arbitration Act. The claim made by the plaintiff against the first defendant does, as was conceded, fall within the scope of clause 20, the arbitration provision in the agreement between the plaintiff and the first defendant. Mr. Pope, counsel for the plaintiff, argued two points: he submitted that the first defendant was not, at relevant times, ready and willing to do all things necessary for arbitration because, for example, in terms of clause 20 it has not yet given notice of the dispute and it has not deposited the sum of $500 with the Master Builders Association of Queensland. On the other hand, the first defendant has beeh asserting through correspondence that the claim made against it by the plaintiff should properly be arbitrated and it is now making this application for stay to facilitate such an arbitration. I am prepared to conclude in those circumstances that the applicant first defendant has, at relevant times, been and remains ready and willing to do all things necessary for the proper conduct of an arbitration of this claim. I am also satisfied that there is no sufficient reason why, this claim should not be referred in accordance with clause 20 of the contract having regard to the requirements of s. 10 subject to what follows. I turn then to Mr. Pope's principal point which was that the first defendant had taken a step in the proceedings before applying to me for a stay. S.ection 10, subs~ 1, of.course, requires that a successful applicant for a stay will apply to the Court for a stay before delivering any pleadings or <> "!14-Covt. Printer, Old. 4 10 20 30 40 50 60 -- 4 of 6 -- 10 20 30 40 50 60 taking any other steps in the proceedings. The other _step, which Mr. Pope contends was taken by the first defendant, was its application to me just determined for the striking out of the writ and the special endorsement upon it. Now, that application was launched by a summons which included a claim for the staying of the action. As a matter of logical convenience the striking out claim was determined by me first but I think in terms of s. 10 that I should regard the application for stay as having been made upon the filing of this summons on 1 April 1990 to which stage the first defendant had indeed taken no other step in the proceedings. It was by this summons that the first defendant applied to the Court to stay the proceedings in terms of s. 10. The application has been heard today and it is true that it has been heard following upon the hearing of the claim for the striking out. But the application was made upon the filing of the summons and that in itself is sufficient to dispose of the suggested impediment to my now applying a stay under my statutory power to facilitate an arbitration. I consider I do have jurisdiction therefore under s.10 subs .1 to impose a stay and I consider that it would be an appropriate exercise in my discretion to do so. I can not make any order staying the action against the second defendant. Logically, that part of the action should await the determination of the claim between the plaintiff and the first defendant, but. I cannot make any order•with relation to the second defendant because it is not party to ... the summons before me. The only order which I make therefore is that in so far as the action includes claims by the plaintiff against the G 214-Govt. Printer, Qld. 10 20 30 40 50 60 -- 5 of 6 -- 10 20 30 40 50 60 first defendant, the action be stayed until further order. HIS HONOUR: The order which I make is upon the first defendant by its counsel undertaking to institute forthwith and expeditiously pursue an arbitration under clause 20 of the contract between the parties of the claims made in this action by the plaintiff against the first defendant, that the action in so far as it concerns claims by the plaintiff against the first defendant be stayed. I grant liberty to apply to the plaintiff upon two days notice to the first defendant. HIS HONOUR: I think I'll make the costs in the cause generally, unless you want to argue it further. There's been some success on each side and I think overall, even taking account of what happened on Wednesday, the fair thing is I simply make costs in the cause. HIS HONOUR: I have not dealt this morning with para. 2 of the summons because I haven't had time to deal with it. It's not necessary that I deal with it this morning, anyway, but I formally order that the claim made by para. 2 of the summons be adjourned to a date to be fixed. G 21.!-Govt. Printer, Qld. 6 10 20 30 40 50 60 -- 6 of 6 --