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ARTICLE · 19 NOVEMBER 2019

Ignore the contract at your peril: developer estopped from relying on contract

Holding Redlich
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Recent decision in SC NSW reinforces well established principles of estoppel.

AustraliaCorporate/Commercial Law
Helena Golovanoff
Helena Golovanoff
Divya Chaddha
Divya Chaddha
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In the recent decision of Futurepower Developments Pty Ltd v TJ & RF Fordham Pty Ltd t/as TRN Group [2019] NSWSC 1554, the Supreme Court of NSW held that the Developer was estopped from relying on the strict interpretation of the contract due to its contract management with the result that the Builder was entitled to payment for additional works. The result validated the determination of the adjudicator under the Building and Construction Industry Security of Payment Act 1999 (NSW) (the SOP Act).

The dispute

The Developer and Builder entered into a building contract in respect of roads and drainage works. The Developer separately engaged Norther Western Surveys (NWS) to act as its surveyors and project managers. This included supervision of construction and contract administration, processing of claims and variations. The building contract specified Mr John Attard of NWS as the Superintendent.

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