NEW SOUTH WALES COURT ISSUES JUDGEMENT FOR ALL CIVIL SOLUTIONS GROUP V/S WOONONA-BULLI RSL MEMORIAL CLUB CASE

Australia, July 30 -- New South Wales Land and Environment Court issued text of the following judgement on June 30:

1. In December 2023, Warrane Design Construct Fit-Out (the Builder) engaged All Civil Solutions Group Pty Ltd (the Subcontractor) to carry out part of the construction work it was contracted to do for Woonona-Bulli RSL Memorial Club Ltd (the Club). This dispute is one of many between the parties. It concerns the Subcontractor's claim against the Club for payment of money due to it from the Builder.

2. In 2024, the Subcontractor served payment claims on the Builder, resulting in adjudication determinations being made under the Building and Construction Industry Security of Payment Act 1999 (NSW) (SOP Act). Then, the Subcontractor obtained judgments against the Builder in the District Court of New South Wales in respect of the adjudicated amounts, together with debt certificates issued under the Contractors Debts Act 1997 (NSW) (CD Act), totalling $2,556,151.20. The Subcontractor served those on the Club together with notices of claim under that Act.

3. The Club made some payments to the Subcontractor, and now the final amount outstanding under those certificates is $1,200,670.24.

4. In and from December 2024, the Builder and the Club also fell into dispute in relation to payment claims and adjudication determinations under the SOP Act. In early 2025, the Builder obtained an adjudication determination against the Club, which it entered as a judgment against the Club in this Court in the amount of $2,141,780.73. The Club commenced proceedings seeking to quash part of the adjudication determination and separately sought to stay the judgment.

5. The Club's application for a stay was heard and determined by Stevenson J: Warrane Design Construct Fit-Out Pty Ltd v Woonona Bulli RSL Memorial Club Ltd [2025] NSWSC 123. His Honour concluded that the Subcontractor's service of the debt certificates had the effect that the judgment obtained by the Builder overstated the amount due by the Club to the Builder by $1,200,670.24: at [17]. His Honour stayed the Builder's judgment to that extent and ordered that the Club pay the balance under the judgment, $941,110.49, into Court pending determination of the Club's challenge to the adjudication determination: at [21].

6. The Club's challenge to the adjudication determination was dismissed by Rees J: Woonona-Bulli RSL Memorial Club Ltd v Warrane-Design Construct Fit-Out Pty Ltd [2025] NSWSC 271.

7. Her Honour was also asked to determine a question about what should occur with the monies that had been paid into Court by the Club: Woonona-Bulli RSL Memorial Club Ltd v Warrane-Design Construct Fit-Out Pty Ltd (No 2) [2025] NSWSC 365 (Woonona (No 2)). Her Honour found that the Subcontractor had no claim on that money but was entitled to take proceedings against the Club to recover the balance outstanding under its debt certificates: see [41]-[42]. Her Honour ordered that $859,134.02 of the funds in Court be paid to the Builder. The balance, being part of the adjudicated amount which the Club had already paid directly to the Subcontractor, was to be returned to the Club.

8. The Club filed a notice of appeal from the orders made by Rees J and sought a stay of the order concerning payment of the monies out of Court. That application was dismissed by Griffiths AJA: Woonona-Bulli RSL Memorial Club Ltd v Warrane-Design Construct Fit-Out Pty Ltd [2025] NSWCA 89. The Club has since discontinued its appeal, but the Builder's application for leave to cross-appeal concerning the money ordered to be returned to the Club remains on foot.

9. The critical question here is whether, on its proper construction, s 11(4) CD Act permits the Club to raise certain matters contained in its Technology and Construction List Response in defence of the Subcontractor's claim. Although the Subcontractor sought summary judgment by way of a notice of motion filed on 4 June 2025, at the hearing of that motion, the parties agreed I should resolve this question of construction on a final basis as a separate question, rather than simply dealing with the summary judgment motion. The parties agreed that the separate question would involve a determination of whether the Club was entitled to raise the matters summarised in Part 1 of its list response, concerning primarily matters of set-off in relation to the alleged breach of contract by the Builder and some payment of money into Court.

10. For the reasons that follow, the Club is entitled to raise, in defence of the Subcontractor's claim, matters of set-off.

*Rest of the document can be viewed at: (https://www.caselaw.nsw.gov.au/decision/197bf1148a9ddce89f55e85f)

Disclaimer: Curated by HT Syndication.