Claimant Entitled to Payment for Variations and Contaminated Fill Removal

The court decided that the claimant was entitled to payment for variations and the removal of contaminated fill from the site, finding that the work was properly instructed and executed according to the contract.

Supreme Court New South Wales

Medium Neutral Citation: [COMPANY] v TJ & [COMPANY] t/as [COMPANY] [2019] NSWSC 1554 Hearing dates: 9, 10, 11, 12, 13 September 2019 Date of orders: 18 October 2019 Decision date: 18 October 2019 Jurisdiction: Equity - Technology and Construction List Before: Rein J Decision: See [88]. Catchwords: BUILDING AND CONSTRUCTION – Contract – Builder reported asbestos contaminated material found on site; variations for removal of the contaminated fill, as well as other variations; owner claims that the [NAME] on the job was not the person contractually agreed to be [NAME] and denies the efficacy of certification and approvals given by that person – Whether owner in breach of contract for failing to ensure the named [NAME] acted in that role – Whether variations had to be in writing – Effect of instructions from the owner's representative to the builder in the presence of [NAME].

BUILDING AND CONSTRUCTION ­­­– Quantum meruit – Where owner instructed builder to remove contaminated fill from the site and builder did so.

ESTOPPEL – Estoppel by convention – Mutual assumption – Whether owner estopped from denying that the [NAME] was [NAME] for the purposes of the contract.

CONTRACT – Misleading conduct under statute — Misleading or deceptive conduct – claim under s 18 of the Australian Consumer Law – Where owner claims that the builder engaged in misleading or deceptive conduct in relation to the need to excavate and remove contaminated fill from site; the builder was instructed to remove the fill and to do so in accordance with the advice of an authorised subcontractor approved by the owner. Legislation Cited: Building and Construction Industry Security of Payment Act 1999 (NSW) Competition and Consumer Act 2010 (Cth) Managing Land Contamination: Planning Guidelines SEPP 55 - Remediation of Land (NSW) National Environment Protection (Assessment of Site Contamination) Measure 1999 (Cth) State Environmental Planning Policy No 55 – Remediation of Land (NSW) Cases Cited: ACCC v TPG Internet Pty Ltd (2013) 250 CLR 640 Acohs Pty Ltd v Ucorp Pty Ltd [2012] FCAFC 16; (2012) 201 FCR 173 Alghussein Establishment v Eton College [1988] 1 WLR 587 [NAME] Investment & Property Co Ltd (in Liq) v Texas Commerce International Bank [1982] QB 84 Bragg v Alam [1981] 1 NSWLR 668 Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592 Commonwealth v Verwayen (1990) 170 CLR 394 [NAME] of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226 Express Newspapers plc v News (UK) Ltd [1990] 3 All ER 376; (1990) 18 IPR 201 Fitzgerald v Deloitte Services Pty Ltd [2017] NSWCA 139 Grundt v Great Boulder Pty Gold Mines Ltd (1937) 59 CLR 641 Hanave Pty Ltd v LFOT Pty Ltd [1999] FCA 357; (1999) 43 IPR 545 Haros v Linfox [2012] FCAFC 42; (2012) 219 IR 177 Hotham v East India Co (1787) 1 TR 638 ; 99 ER 1295 Jones v Dunkel (1959) 101 CLR 298 Liebe v Molloy (1906) 4 CLR 347 Mackay v Dick (1881) 6 App Cas 251 Mandurah Enterprises Pty Ltd v Western Australian Planning Commission [2008] WASCA 211; (2008) 38 WAR 276 Melbourne Harbour Trust Commissioners v Hancock (1927) 39 CLR 570 Moratic Pty Ltd v Gordon [2007] NSWSC 5; (2007) 13 BPR 24,713 Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221 [COMPANY] v [NAME] Co (A/asia) [COMPANY] (1954) 90 CLR 235 Plaza Pty Ltd v Simon's Earthworks (NSW) Pty Ltd [2010] NSWSC 1426 [COMPANY] v Minister for Public Works (1992) 26 NSWLR 234 Ruthol Pty Ltd v Tricon (Australia) [2005] NSWCA 443 [COMPANY] t/as Volume Plus v Euphoric Pty Ltd [2007] NSWCA 65; (2007) 69 NSWLR 603 Sprague v Booth [1909] AC 576 The "Indian Grace" (No 2) [1998] AC 878 Wegan Constructions Pty Ltd v Wadonga Sewerage Authority [1978] VR 67; (1977) 36 LGRA 147 Texts Cited: [NAME] (ed), Chitty on Contract (Thomson Reuters, 33rd ed, 2018) [NAME], Contract Law in Australia (LexisNexis Butterworths, 6th ed, 2013) Category: [NAME] judgment Parties: [COMPANY] (Plaintiff) TJ & [COMPANY] t/as [COMPANY] (Defendant) Representation: Counsel: [redacted] [NAME] SC with [NAME] (Defendant)

Solicitors: [redacted] [NAME] (Defendant) File Number(s): 2016/195001 Publication restriction: Nil

Judgment 1. These proceedings concern a building contract ("the Contract") entered into by the Plaintiff ("[NAME]") and the Defendant ("[NAME]") on 12 June 2015, in respect of roads and drainage works to be carried out by [NAME] at a site in [ADDRESS] ("the Site"). [NAME] SC with [NAME] appears for [NAME] and [NAME] SC with [NAME] appears for [NAME].

2. The works were completed in September 2016. The Contract specified a period of 15 weeks for the work.

3. The original contract sum was $899,000, but with variations the sum claimed expanded to $1,399,596.73: see CB A9:3580 (note that "CB" stands for Court Book and A9 refers to the Exhibit number of that volume of the CB). 4. [NAME] did not pay all of the monies claimed under the [NAME] issued two payment claims pursuant to the Building and Construction Industry Security of Payment Act 1999 (NSW) ("SOPA") to [NAME] in respect of which two adjudication amounts were awarded to [NAME]. The first adjudication determination was given on 1 June 2016 and the second determination on 4 August 2017. Following the adjudications, [NAME] paid all the monies specified in the respective adjudication amounts, a total of $922,622.12. [NAME] has therefore been paid all of the money to which it claimed to be entitled, save for $24,723.68 (inclusive of GST) which [NAME] has retained and which [NAME] seeks to recover by its Cross Claim.

5. In these proceedings, [NAME] seeks to recover from [NAME] the amounts paid for variations V01, V03, V09, V10, V11, V12, V13, V15 and V16. Of these, the largest and most significant is V01, which I shall refer to as the "Fill Removal Variation". I shall refer to the other variations still in dispute as the "Miscellaneous Variations". The Fill Removal Variation was certified at $330,735 and the Miscellaneous Variations totalled $93,131. [NAME] also advances against [NAME] a claim for liquidated damages based on alleged delay by [NAME]. The Contract provides for liquidated damages of $500 per day for delay beyond the contracted period. [NAME] claims $500 per day for 325 days, i.e. $162,500. I shall refer to this as the "Liquidated Damages Claim". In the alternative, [NAME] claims nine days at $500, i.e. $4,500 – this being based on a certified extension of time to 26 August 2016 and a date of Practical Completion of 2 September 2016: see CB A9:3551. 6. [NAME] puts as the basis for recovery of all of its claims, including the Fill Removal Variation, the alleged failure by [NAME] to abide by the Contract's terms. In relation to the Fill Removal Variation, it has a second and discrete basis, namely that it claims that [NAME] engaged in misleading or deceptive conduct within the meaning of s 18 of the Australian Consumer Law (sch 2 of the Competition and Consumer Act 2010 (Cth) ("ACL"). I shall defer detailing the bases of these claims until I have set out the facts.

7. I shall endeavour to summarise in this section the largely uncontested facts, most of which are taken from the Plaintiff's Closing Submissions ("PCS") and the Defendant's Closing Submissions ("DCS"), both of 13 September 2019:

1. In about 2009, [NAME] purchased the land at Lot [ADDRESS], [ADDRESS]. The Site was approximately 2.05 hectares (5 acres or 20,500 m2) in size. At the time of its purchase, the Site was semi-rural land upon which were constructed a fibro residential dwelling, associated outbuildings and sheds, and a market garden.

2. In about December 2014, [NAME] obtained development consent from Liverpool City Council to subdivide the Site into 37 residential lots and to carry out associated road and drainage works, and to demolish the existing structures on the Site. 3. [NAME] was appointed by [NAME] to manage the development of the Site. [NAME] was the sole director and shareholder of [NAME]. However, at all relevant times, [NAME]'s husband, [NAME] (and not [NAME]), acted on behalf of [NAME]. [NAME] is a solicitor and, indeed, he acted as solicitor for [NAME] in these proceedings until November 2017.

4. On about 14 March 2014, [NAME] engaged [COMPANY] ("[NAME]") to act as its surveyors and project managers on the development project: see Affidavit of [NAME] dated 16 May 2017 at para 45.

5. The Contract between [NAME] and [NAME] provided that, inter alia, [NAME]'s work would include "supervision of construction and contract administration, processing of claims and variations": CB A2:531.

6. In order to obtain development consent for the residential subdivision, the Plaintiff retained [COMPANY] ("[NAME]") to carry out a preliminary site investigation, as required by cl 7 of the State Environmental Planning Policy No 55 – Remediation of Land (NSW) ("SEPP 55") and the Managing Land Contamination: Planning Guidelines SEPP 55 - Remediation of Land (NSW).

7. On about 27 March 2014, [NAME] of [NAME] prepared a Preliminary & Detailed Site Investigation Report in respect of the Site (the "[NAME]"): see CB A2:422-527. The [NAME] was provided to, and was apparently commissioned by, [NAME] (CB A2:423). The [NAME] was based on, inter alia, a visual inspection of the Site and soil testing across the Site.

8. The [NAME] made the following findings about possible contamination on the Site:

1. From the visual inspection, two areas of the property were identified as containing areas of fill impacted by suspected asbestos containing materials (based on field observations and test pits): see Figures 2 and 3 of the [NAME]. These areas were near the centre of the Site, near the eastern boundary, and were described as:

1. Table top jump with uncontrolled fill material, "PACM" (i.e. Possible Asbestos Containing Material) observed on surface (Area 4); and 2. Earth berm PACM observed in fill (Area 4).

1. As for the soil testing across the Site, of the 32 sampling points established on the Site, only one test pit returned a positive result for the presence of asbestos (being PACM1/ASB01): see Figure 3 of the [NAME]. This area was near the centre of the property, on the eastern boundary, in the area described as "Table top jump with uncontrolled fill material, PACM observed on surface" (Area 4).

1. The [NAME] stated: "asbestos was reported at a number of locations" and "remediation is required at the site prior to it being considered suitable for future residential land-uses from a contamination perspective" (CB A2:423, 448).

1. The [NAME] recommended:

1. That a Remediation Action Plan ("RAP") be prepared (CB A2:423, 444);

2. Excavation to stockpile un-controlled fill in Areas 2 and 4 (CB A2:423);

3. Excavation to stockpile fill in Area 4 - fill identified and shown to contain asbestos impacts (CB A2:424, 441);

4. The septic tank be removed and inspected by an environmental consultant (CB A2:444);

5. That any soils identified during civil construction work, including asbestos: "should be segregated for further assessment and characterisation by an appropriately experienced environmental consultant" (CB A2:443).

1. The [NAME] stated that during a Site walkover, it was observed that there were a number of stockpiles of both demolition rubble and domestic waste where the presence of asbestos could not be discounted (CB A2:431).

2. The Plaintiff contracted [COMPANY] ("Affordable Demolition") to demolish the dwelling, outbuildings and sheds on the Site: see Affidavit of [NAME] dated 16 May 2017 at paras 12-14. Affordable Demolition was a licensed asbestos removalist. [NAME] of Affordable Demolition was [NAME].

3. Affordable Demolition carried out the demolition work at the Site over approximately 3 weeks in about January and February 2015.

4. At the conclusion of the demolition works, [NAME] was engaged to carry out a clearance inspection of the area of the Site where the residential dwelling and other improvements had been constructed. That area was approximately 1,100 m2 in size, in the south-eastern area of the Site. The clearance inspection involved a visual inspection of the area and soil sampling of the area.

5. Following these inspections, on about 19 March 2015 [NAME] of [NAME] prepared a Clearance Inspection Report for the area of the Site where the residential dwelling and other improvements had been constructed prior to their demolition ("Clearance Report") (CB A3:931), which found that:

1. No asbestos containing materials were identified during the inspection on 17 March 2015 in the part of the Site where the demolition works had taken place; and 2. No asbestos was detected in any of the soil samples submitted for laboratory analysis, those samples having been taken from the part of the Site where the demolition works had taken place.

1. The [NAME], however, was qualified as follows:

1. On or about 10 March 2015, [NAME] of [NAME] emailed [NAME] advising that he had: "attended site at [ADDRESS] to conduct an inspection of the demolition area. While the demolition of structures may be complete at the site, there is a significant amount of fragmented Potentially Asbestos Containing Material remaining on the soil surface across the building footprints" (CB A3:925-926). 1. [NAME]'s email was forwarded to [NAME] on the same day at 4.53 pm, at which time [NAME] stated: "Demolition and remediation works need to be completed thoroughly to minimise any additional cost or time" (CB A3:927).

1. On or about 19 March 2015, [NAME] prepared a Clearance Certificate in respect of the area where the buildings were demolished. The investigation area was limited to the south-eastern boundary of the Site (CB A3:932, 935, 938). The certificate expressly stated that it did not apply to the Site in its entirety, and was "an interim-validation report for the investigated areas only." (CB A3:935).

1. On about 7 April 2015, Liverpool Council issued a construction certificate for the Site. This was done after the Clearance Report had been submitted to Council for its review: CB A3:1030.

2. On about 31 March 2015, [NAME] entered into a deed with the owner of adjoining Lot 32, [COMPANY] ("[NAME]"), pursuant to which [NAME] granted [NAME] the right to enter Lot 33 to carry out works, including the construction of a sewer line and temporary drainage works on Lot 33: CB A3:1031-1068. 3. [NAME] was contracted to carry out the works on the Site under the terms of the deed with [NAME]. The Defendant carried out those works in about April and May 2015 (after the demolition of the structures on the Site, as detailed above): see Affidavit of [NAME] dated 16 May 2017 at paras 58-59. These works were not part of the Contract presently under consideration. 4. [NAME] commenced excavation and clearing of the Site on about 7 July 2015: see Affidavit of [NAME] dated 29 June 2018 at paras 27 and 37.

5. On 8 July 2015, employees of [NAME] found a septic tank that required removal and [NAME] sent an email to [NAME] of [NAME] (see CB A4:1439) in which he said: "Dean has found an existing Septic tank which will require removal. Can you instruct us in this matter."

1. On 9 July 2015, [NAME] advised [NAME] that the Defendant was authorised to remove the septic tank: see Affidavit of [NAME] dated 16 May 2017 at para 81 and CB A4:1446.

2. On 9 July 2015 [NAME] observed demolition waste and asbestos fragments around the septic tank. He organised three to four test pits to be dug approximately five metres from the septic tank and on the following day he observed uncontrolled fill and asbestos fragments. He directed [NAME] of [NAME] to dig three to four test pits approximately five metres from the septic tank excavation: see para 79 of [NAME]'s Affidavit of 29 June 2018, Exhibit 3, p 13. He arranged to meet with [NAME] on 10 July 2015 and showed him what he thought were asbestos fragments (Exhibit 3, p.13-14). They had the following conversation: "[NAME]: 'It looks like this Site is contaminated with asbestos. You should organise a meeting onsite with [NAME] and [NAME] [who are environmental and asbestos consultants I had worked with on the adjacent site with [NAME]].' I said: 'OK, I'll contact them. You should organise to get the client down here so we can get a direction." [NAME]: 'OK.'"

1. On 10 July 2015, [NAME] of [NAME] sent an email to [NAME] (CB A4:1452-1455), which included the following: "As discussed yesterday, [NAME] have come across areas of uncontrolled fill and asbestos in your subdivision at [ADDRESS]. I have attached a couple of photos for your review. I have attached a plan which shows the area of concern which is littered with asbestos, bricks and fibre sheets… All uncontrolled fill and fill containing asbestos will need to be removed off site. I expect this exercise to cost roughly $100,000 … [NAME] are going to undertake test digs to quantify the area and will stockpile for removal."

1. Between 10 and 14 July 2015, [NAME] contacted [NAME] of [COMPANY] ("[NAME]") and [NAME] of [COMPANY] ("[NAME]"), seeking details of their rates. [NAME] is an environmental consulting firm and [NAME] is a specialised demolition remediation and waste management contractor holding licenses to handle asbestos (see paras 8-12 of [NAME]'s Affidavit of 8 February 2019, Exhibit 3, p. 53). [NAME] attended the Site on 14 July 2015. [NAME] attended the Site on one day around this time.

2. On 13 July 2015, [NAME] informed [NAME] that [NAME] would organise "potholing" and that [NAME] would: "not progress the works further till I confirm rates from [NAME] and [NAME] and have approval to proceed" (see CB A4:1463 – the email had the heading "asbestos"). [NAME] subsequently dug potholes in the region of concern: see Exhibit 2, [NAME]'s Affidavit of 29 June 2018 at 89 and 99, and T282.1-47.

3. On 13 July 2015 [NAME] of [NAME] was on Site. A document appears to have been created by him which confirmed the presence of asbestos, or at least material thought to be asbestos, as at that date. I shall refer to this as the "[NAME]", although [NAME] objected to it remaining in the Court Book and does not accept that any weight can be placed upon it.

4. On 14 July 2015, by email sent at 8.46 am, [NAME] advised [NAME] that the "contamination at Jardine Dr is substantial" (CB A4:1464).

5. On 14 July 2015 [NAME] and [NAME] met on Site. I will return to the details of this meeting below.

6. Later that morning at 11.36 am, [NAME] informed [NAME] that he had: "... obtained a copy of the initial contam [sic] report from [NAME], please see attached plan which clearly identifies further asbestos contamination. Although the area which we were looking at today is not shown. Whilst the boys are pot holing, might be best to have the blue areas on the attached plan pot holed also ..." (CB A4:1488-1489).

1. The plan attached to [NAME]'s email of 11.36 am was a map prepared by [NAME] which showed further details about asbestos contaminated material beyond the details shown on the map prepared on 24 March 2014 (CB A3:448, A10:3676).

2. On 14 July 2015 [NAME] sent a notice concerning asbestos to [NAME] ("the [NAME] Notice"): CB A4:1479. It contained a description of the asbestos as "About 50 Small Fragments Of Asbestos In Soil", the location being "Right In The Middle Of The Property."

3. On 15 July 2015, [NAME] provided [NAME] with pricing from [NAME] and [NAME] for "load, dispose and validation" (CB A4:1507, 1512). Those rates were forwarded by [NAME] to [NAME] on 16 July 2015 (CB A4:1520).

4. On 21 July 2015 there was a meeting on Site which [NAME] and [NAME] attended. It is an important meeting about which there is a significant dispute.

5. The diary note of [NAME] of the meeting is in evidence (CB 1525). It says: "[NAME] / [NAME] / [NAME] to provide rates for removal Fill to be removed offsite (unsuitable) [NAME] to be appointed by [NAME] to manage" The reference to "[NAME]" appears to be to [NAME], as [NAME] is separately mentioned: see T385.10-41.

1. On 22 July 2015, [NAME] recorded in its Daily Field Report the direction to proceed to stockpile and remove the asbestos contaminated material. The removal from the ground and stockpiling commenced on 22 July 2015 and was completed on 23 July 2015 (CB A4:1534, 1541).

2. On 4 August 2015, the material stockpiled was the subject of a survey which recorded that the volume of asbestos contaminated material was 718 m3 (CB A5:1650, 1653). [NAME] advised [NAME] that [NAME] would try to "dry the material prior to disposal to reduce the weight."

3. On 10 August 2019, [NAME], an employee of the Defendant, advised that the stockpiles needed to be moved so that the earthworks could continue at the Site and asked (CB A5:1804): "Can you confirm we can go ahead with the asbestos removal." 1. [NAME] then gave written instruction for the removal of the stockpiled fill by email on 10 August 2015 (CB A5:1805): "Please proceed with the removal. Please issue all dockets and relevant substantiation for your progress claims."

1. On 12 August 2015, 1,191.2 tonnes of fill was removed from the Site (CB A5:1832, 1833, 1873-1874, 1875, 1876, 1877).

2. On 31 August 2015, [NAME] advised [NAME] that the balance of the stockpile, which had been drying out to dispel hydrocarbons and reduce weight, was to be removed (CB A6:2278).

3. On 2 September 2015, [NAME] removed a further 236.24 tonnes (8 loads) of fill from the Site (CB A6:2281-2294). These works were the subject of Payment Claim No. 2 dated 31 August 2015 (CB A6:2297). A very considerable portion of the total cost of V01 was the amounts paid for haulage, i.e. $306,519 (see CB A7:2449).

4. The claim for the removal of the excavated fill was subsequently accepted and certified by [NAME], signing as [NAME] (CB A6:2300-2301, 2361). 5. [NAME] continued to carry out its work under the Contract. It advised of a number of variations (orally) and sought instructions from [NAME], which instructions were given. 6. [NAME] approved all of the Miscellaneous Variations and certified that the work had been carried out by [NAME] for the value claimed: see CB A9:3579. 7. [NAME] also granted extensions of time that were claimed by [NAME] – mainly for wet weather but also due to the excavation of the septic tank and fill, taking the Date for Completion to 24 August 2016: CB A9:3481.

8. On 6 September 2016 [NAME] issued a Notice of Practical Completion specifying the Date for Completion as 2 September 2016: CB A9:3553.

1. The Contract contains the following clauses of relevance: "1 Interpretation and construction of Contract […] certificate of practical completion has the meaning in subclause 34.6; […] date for practical completion means: a) where Item 7(a) provides for practical completion, the date; b) where Item 7(b) provides a period of time for practical completion, the last day of the period, but if any EOT for practical completion is directed by [NAME] or allowed in any arbitration or litigation, it means the date resulting therefrom; date of practical completion means: a) the date evidenced in a certificate of practical completion as the date upon which practical completion was reached; or b) where another date is determined or litigation as the date upon which practical completion was reached, that other date; […] final certificate has the meaning in subclause 74.4; […] practical completion is that stage in the carrying out and completion of WUC when: a) the Works are complete except for minor defects: i) which do not prevent the Works from being reasonably capable of being used for their stated purpose; ii) which [NAME] determines the Contractor has reasonable grounds for not promptly rectifying; and iii) the rectification of which will not prejudice the convenient use of the Works; […] progress certificate has the meaning in subclause 37.2; […] schedule of rates means any schedule included in the Contract which, in respect of any section or work to be carried out, shows the rate or respective rates of payment for the execution of the work and which may also include lump sums, provisional sums, other sums, quantities and prices; […] [NAME] means the person stated in Item 5 as [NAME] or other person from time to time appointed in writing by [NAME] to be [NAME] and notified as such in writing to the Contractor by [NAME] and, so far as concerns the functions exercisable by a [NAME]'s Representative, includes a [NAME]'s Representative; [NAME]'s Representative means an individual appointed in writing [NAME] under clause 21; […] 20 [NAME] shall ensure that at all times there is a [NAME], and that [NAME] fulfils all aspects of the role and functions reasonably and in good faith. Except where the Contract otherwise provides, [NAME] may give a direction orally but shall as soon as practicable confirm it in writing. If the Contractor in writing requests [NAME] to confirm an oral direction, the Contractor shall not be bound to comply with the direction until [NAME] does so. 21 [NAME]'s [NAME] may from time to time appoint individuals to exercise delegated [NAME]'s functions, provided that: […] c) [NAME] forthwith gives the Contractor written notice of respectively; i) the appointment, including [NAME]'s Representative's name and delegated functions; and ii) the termination of each appointment; […] 25 Latent Conditions 25.1 Scope Latent conditions are physical conditions on the site and its near surrounds, including artificial things but excluding weather conditions, which differ materially from the physical conditions which should reasonably have been anticipated by a competent Contractor at the time of the Contractor's tender if the Contractor had inspected: a) all written information made available by [NAME] to the Contractor for the purpose of tendering; b) all information influencing the risk allocation in the Contractor's tender and reasonably obtainable by the making of reasonable enquiries; and c) the site and its near surrounds. 25.2 Notification The Contractor, upon becoming aware of a latent condition while carrying out WUC, shall promptly, and where possible before the latent condition is disturbed, give [NAME] written notice of the general nature thereof. If required by [NAME] promptly after receiving that notice, the Contractor shall, as soon as practicable, give [NAME] a written statement of: a) the latent condition encountered and the respects in which it differs materially; b) the additional work, resources, time and cost which the Contractor estimates to be necessary to deal with the latent condition; and c) other details reasonably required by [NAME]. 25.3 Deemed variation The effect of the latent condition shall be a deemed variation, priced having no regard to additional cost incurred more than 28 days before the date on which the Contractor gave the notice required by the first paragraph of subclause 25.2 but so as to include the Contractor's other costs for each compliance with subclause 25.2. 34 Time and progress 34.1 Progress The Contractor shall ensure that WUC reaches practical completion by the date for practical completion. 34.2 Notice of delay A party becoming aware of anything which will probably cause delay to WUC shall promptly give [NAME] and the other party written notice of that cause and the estimated delay. 34.3 Claim The Contractor shall be entitled to such extension of time for carrying out WUC (including reaching practical completion) as [NAME] assesses ('EOT'), if: a) the Contractor is or will be delayed in reaching practical completion by a qualifying cause of delay, and b) the Contractor gives [NAME], within 28 days of when the Contractor should reasonably have become aware of that causation occurring, a written claim for an EOT evidencing the facts of causation and of the delay to WUC (including extent). If further delay results from a qualifying cause of delay evidenced in a claim under paragraph (b) of this subclause, the Contractor shall claim an EOT for such delay by promptly giving [NAME] a written claim evidencing the facts of that delay. […] 34.5 Extension of time Within 28 days after receiving the Contractor's claim for an EOT, [NAME] shall give to the Contractor and [NAME] a written direction evidencing the EOT so assessed. If [NAME] does not do so, there shall be a deemed assessment and direction for an EOT as claimed. Notwithstanding that the Contractor is not entitled to or has not claimed an EOT, [NAME] may at any time and from time to time before issuing the final certificate direct an EOT. 34.6 Practical completion The Contractor shall give [NAME] at least 14 days written notice of the date upon which the Contractor anticipates that practical completion will be reached. When the Contractor is of the opinion that practical completion has been reached, the Contractor shall in writing request [NAME] to issue a Certificate of practical completion. Within 14 days after receiving the request, [NAME] shall give the Contractor and [NAME] either a certificate of practical completion evidencing the date of practical completion or written reasons for not doing so. If [NAME] is of the opinion that practical completion has been reached, [NAME] may issue a certificate of practical completion even though no request has been made. 34.7 Liquidated damages If WVC does not reach practical completion by the date for practical completion, [NAME] shall certify, as due and payable to [NAME], liquidated damages in Item 24 for every day after the date for practical completion to and including the earliest of the date of practical completion or termination of the Contract or [NAME] taking WUC out of the hands of the Contractor. If an EOT is directed after the Contractor has paid or [NAME] has set off liquidated damages, [NAME] shall forthwith repay to the Contractor such of those liquidated damages as represent the days the subject of the EOT. 36 Variations 36.1 Directing variations The Contractor shall not vary WUC except as directed in writing. [NAME], before the date of practical completion, may direct the Contractor to vary WUC by any one or more of the following which is nevertheless of a character and extent contemplated by, and capable of being carried out under, the provisions of the Contract: a) increase, decrease or omit any part; b) change the character or quality; c) change the levels, lines, positions or dimensions; d) carry out additional work; e) demolish or remove material or work no longer required by [NAME]. 36.2 Proposed variations [NAME] may give the Contractor written notice of proposed variation. The Contractor shall as soon as practicable after receiving such notice, notify [NAME] whether the proposed variation can be effected, together with, if it can be effected, the Contractor's estimate of the: a) effect on the construction program (including the date for practical completion); and b) cost (including all time-related costs, if any) of the proposed variation. [NAME] may direct the Contractor to give a detailed quotation for the proposed variation supported by measurements or other evidence of cost. The Contractor's costs for each compliance with this subclause shall be certified by [NAME] as moneys due to the Contractor. 36.3 Variations for convenience of contractor If the Contractor requests [NAME] to direct a variation for the convenience of the Contractor, [NAME] may do so. The direction shall be written and may be conditional. Unless the direction provides otherwise, the Contractor shall be entitled to neither extra time nor extra money. 36.4 [NAME] shall, as soon as possible, price each variation using the following order of precedence: a) prior agreement; b) applicable rates or prices in the Contract; c) rates or prices in a priced bill of quantities, schedule of rates or schedule of prices, even though not Contract documents, to the extent that it is reasonable to use them; and d) reasonable rates or prices, which shall include a reasonable amount for profit and overheads, and any deductions shall include a reasonable amount for profit but not overheads. That price shall be added to or deducted from the contract sum. 37 Payment 37.1 Progress Claims The Contractor shall claim payment progressively in accordance with Item 28. An early progress claim shall be deemed to have been made on the date for making that claim. Each progress claim shall be given in writing to [NAME] and shall include details of the value of WUC done and may include details of other moneys then due to the Contractor pursuant to provisions of the Contract. 37.2 [NAME] shall, within 14 days after receiving such a progress claim, issue to [NAME] and the Contractor: a) a progress certificate evidencing [NAME]'s opinion of the moneys due from [NAME] to the Contractor pursuant to the progress claim and reasons for any difference ("progress certificate"); and b) a certificate evidencing [NAME]'s assessment of retention moneys and moneys due from the Contractor to [NAME] pursuant to the Contract. If the Contractor does not make a progress claim in accordance with is Item 28, [NAME] may issue the progress certificate with details of the calculations and shall issue the certificate in paragraph (b). If [NAME] does not issue the progress certificate within 14 days of receiving a progress claim in accordance with subclause 37.1, that progress claim shall be deemed to be the relevant progress certificate. [NAME] shall within 7 days after receiving both such certificates, or within 21 days after [NAME] receives the progress claim, pay to the Contractor the balance of the progress certificate after deducting retention moneys and setting off such of the certificate in paragraph (b) as [NAME] elects to set off. If that setting off produces a negative 25 balance, the Contractor shall pay that balance to [NAME] within 7 days of receiving written notice thereof. Neither a progress certificate nor a payment of moneys shall be evidence that the subject WUC has been carried out satisfactorily. Payment other than final payment shall be payment on account only. […] 41 Notification of claims 41.1 Communication of claims The prescribed notice is a written notice of the general basis and quantum of the claim. As soon as practicable after a party becomes aware of any claim in connection with the subject matter of the Contract, that party shall give to the other party and to [NAME] the prescribed notice or a notice of dispute under subclause 42.1. This subclause and subclause 41.3 shall not apply to any claim, including a claim for payment (except for claims which would, other than for this subclause, have been included in the final payment claim), the communication of which is required by another provision of the Contract. 41.2 Liability for failure to communicate The failure of a party to comply with the provisions of subclause 41.1 or to communicate a claim in accordance with the relevant provision of the Contract shall, inter alia, entitle the other party to damages for breach of Contract but shall neither bar nor invalidate the claim. 41.3 [NAME]'s decision If within 28 days of giving the prescribed notice the party giving it does not notify the other party and [NAME] of particulars of the claim, the prescribed notice shall be deemed to be the claim. Within 56 days of receipt of the prescribed notice [NAME] shall assess the claim and notify the parties in writing of the decision. Unless a party within a further 28 days of such notification gives a notice of dispute under subclause 42.1 which includes such decision, [NAME] shall certify the amount of that assessment to be moneys then due and payable."

1. At Item 5 of Part A (an annexure to the Contract) [NAME] is specified as: "[COMPANY]………………………… [NAME]…………………………………………………"

1. In April 2016 [NAME] corresponded with [NAME] in respect of the Fill Removal Variation. This correspondence was part of the Court Book prepared on behalf of [NAME] but then objected to by [NAME] (see T114 – T118) on the basis that the document was written long after the removal of fill, was hearsay, self-serving and prejudicial in nature, and I indicated that I would admit the document over [NAME]'s objection and give my formal reasons for that decision at a later time. In my view, the documents are at the very least relevant to the issue of whether [NAME] was misled by anything said or done by [NAME]. They are also, as it happens, relevant as to [NAME]'s understanding of [NAME]'s role and indirectly on the question of whether [NAME] gave instructions to [NAME] on 21 July 2015. The idea that [NAME] could mount a case that [NAME] was misled by [NAME], not call [NAME] and then object to evidence of what [NAME] said eight months later is surprising to say the least.

2. Before dealing with the more contentious evidence, I shall now seek to detail [NAME]'s case, which has these elements:

1. The Contract specifies [NAME] as [NAME]. [NAME] and [NAME] are employees of [NAME] but [NAME] was not nominated as [NAME] and he was never appointed by [NAME] or [NAME] as [NAME]. 2. [NAME] was not [NAME], none of his approvals, directions or certificates have any force or relevance.

3. The Contract requires variations to be communicated in writing and approved in writing – the variations in dispute were not the subject of written notice or direction.

4. In respect of the Fill Removal Variation, [NAME] engaged in misleading or deceptive conduct which led [NAME] to agree to the Fill Removal Variation. In submissions [NAME] contended that this claim must be viewed as a claim in the alternative.

1. With respect to [NAME]'s characterisation of the misleading or deceptive conduct claim as an alternative submission, [NAME] contends that that is not how it was put in [NAME]'s List Statement, having regard to para 23 of the List Statement in which [NAME] asserts that: "In reliance on the Representations, [NAME] issued a written email instruction to [NAME] of 10 August 2015 to proceed with the proposed removal of soil from the Site and for the cost to be submitted as part of [NAME]'s progress claims under the Contract." I think that there is considerable force in [NAME]' submission.

The Misleading or Deceptive Conduct Case 1. Asbestos can be characterised as friable or non-friable. The most common type of asbestos soil contamination in Australia is non-friable bonded forms of asbestos containing material in cement sheeting and cement building products: see sch B1 of the National Environment Protection (Assessment of Site Contamination) Measure 1999 (Cth) ("the NEPM Guidelines") CB A1:45. Friable asbestos includes severely weathered cement sheeting, insulation products and woven asbestos material: CB A1:47. 2. [NAME] in closing oral submissions (see T365.13 – 373.29) identified the conduct which is said to have misled [NAME] as:

1. The email of 4 August 2015 from [NAME] to [NAME] ("the Volume Email") stating: "There is approximately 718 m3 of asbestos contaminated material in stockpile at Lot 33" (see CB A5:1653 – [NAME] referred to CB A5:1650 but that was the same information being sent to [NAME]).

1. The email of 15 July 2015 (CB A4:1507) from [NAME] to [NAME] in which he set out the pricing for load, disposal and validation for Lot 33 ("the Rates Email"). 2. [NAME] said at T280.13-16 in response to [NAME]'s question: "Q. I understand that, but as at that date it was your intention, subject to getting instructions from [NAME], to strip the affected area, stockpile then load out? A. Yes." The date referred to there was 15 July 2015: T279.40.

1. CB A5:1804-1805 – [NAME] sought approval to: "go ahead with the asbestos removal", which [NAME] sent to [NAME] and on the same day [NAME] replied: "Please proceed with removal. Please issue all dockets and relevant substantiation for your progress claims. If you have any queries, please don't hesitate to contact me at any time" (CB A5:1805).

1. CB A4:1452, which is an email sent by [NAME] to [NAME] on 10 July 2015 and which is in the following terms: "[NAME], As discussed yesterday, [NAME] have come across areas of uncontrolled fill and asbestos in your subdivision at [ADDRESS]. I have attached a couple of photos for your review. I have attached a plan which shows the area of concern which is littered with asbestos, bricks and fibre sheets. After reviewing the validation report, the area of concern is outside of the test bores identified. It appears the demolition contractor or someone else has imported the fill which was contaminated with asbestos and was uncontrolled. All uncontrolled fill and fill containing asbestos will need to be removed off site. I expect this exercise to cost roughly $100,000 given [NAME] located a similar sized hot spot within the Crownland subdivision next door. [NAME] are going to undertake test digs to quantify the area and will stockpile for removal. Once the area has been identified, we will meet onsite to review and confirm. We envisage a site meeting next Wednesday next week, first thing in the morning, please pencil this in your diary. If you have any queries, please don't hesitate to contact me at any time. Regards, [NAME]"

1. That [NAME] informed [NAME] that the material on Site had to be removed (see T373.15-21): "…by conduct and specific words that there was asbestos on the site in such concentration as necessitated the remediation action that was in fact taken. That is to say, the scraping, the excavation, the stockpiling and the removal."

1. I have mentioned three meetings on Site – 10 July 2015 (see [7](23) above), 14 July 2015 and 21 July 2015. The 10 July meeting was attended by [NAME] and [NAME]. The 14 July meeting was attended by [NAME] and [NAME]. The 21 July 2015 meeting was attended by [NAME] and [NAME]. [NAME] and [NAME] provided affidavits and were cross examined. [NAME] was not called by either side. [NAME] draws attention to the fact that whether or not [NAME] is to be treated as [NAME] under the Contract (a matter to which I shall return), [NAME] was at all times [NAME] as the agent of [NAME] and [NAME] was the employee who at all relevant times was engaged in the development for [NAME], at the very least as project manager. [NAME] submits that a Jones v Dunkel (1959) 101 CLR 298 inference should be drawn against [NAME] – i.e. that [NAME]'s evidence, if he had been called, would not have assisted [NAME]'s case.

2. I accept this submission, but the failure of [NAME] to call [NAME] is even starker in this matter and goes beyond a [NAME] v [NAME] issue because it is [NAME]'s case that it was [NAME] who was misled by [NAME]'s conduct.

3. I thought that each of the witnesses called by [NAME] (namely, [NAME] and [NAME]) were entirely credible. I have no hesitation in accepting them as witnesses of truth. [NAME] agreed that his recollection now of events occurring four years ago without the benefit of notes is far from perfect, and that he was, for example, relying on the emails that he sent or received to help him piece together the history of what occurred (see, for example, T261 – T263), which is hardly surprising. [NAME], an expert called by [NAME] in its quantum meruit claim, was not required for cross examination and there was no evidence relied on by [NAME] in answer to [NAME]'s report. 4. [NAME] and [NAME] were witnesses of [NAME] who were not required for cross examination (after Counsel for [NAME] advised that parts of their affidavits were not relied upon). [NAME] said that when he finished demolition of the structures on Site in April 2015 he did not observe any asbestos fragments. [NAME] was cross examined but I have no reason to doubt his honesty either. [NAME] witness for [NAME], was cross examined and I shall deal with his credibility separately. [NAME], a specialist in asbestos remediation was called by [NAME] and cross examined. [NAME] objected to receipt of his report on the basis that it was entirely irrelevant. I admitted the report notwithstanding my tentative view that it was not relevant, and I shall deal with his report later. 5. [NAME] says of the 14 July Site visit at para 17 of his Affidavit of 2 July 2018: "17. On 14 July 2015, I walked over the southern end of the Site for approximately 40 minutes. As I walked around the Site I observed: a) The primary location of the most asbestos contamination was in the middle of the southern and south-eastern part of the site that were clearly visible to the naked eye. b) The asbestos was present in grass and buried along the boundary with an adjoining house. The asbestos fragments were also clearly visible to the naked eye and present in the potholes. c) The asbestos fragments contained fibre bundles which I observed were visible to the naked eye." 1. [NAME] says of the 14 July Site visit at paras 89-99 of his Affidavit of 29 June 2018: "Meeting on 14 July 2015 89. On or about Tuesday, 14 July 2015, I attended a meeting with [NAME]'s contaminated land consultant, [NAME] ([NAME]) of [COMPANY] ([NAME]) and [NAME] at the Site. The purpose of the meeting was to observe the area that had been potholed and inspect the material in the excavations. It was my intention to have [NAME] confirm whether there was presence of asbestos material and, if so, how to deal with it. [NAME] had been engaged by [NAME] on adjacent sites to the Project as we had encountered asbestos contaminated soils on those sites also.

90. While waiting for the other parties to arrive at the meeting, I walked around the Site with [NAME]. I observed asbestos fragments in the topsoil stripped off the drainage line and stockpiled along the eastern boundary. The drainage line work on the south eastern boundary had been performed by [NAME] on about 19 May 2015, these works were a component of the adjoining subdivision constructed by [NAME] for [COMPANY].

91. When [NAME] and [NAME] arrived at Site, I brought these asbestos fragments to their attention by pointing to them as we walked around the Site. When we were in this area, words were said to the following effect. I said: "This is the area where the buildings were demolished, it is likely these fragments have been tracked into the soil by the demolition contractor." [NAME]: "Check out this fragment [he was pointing to a fragment on the ground]. It has dimpling like a golf ball. It is one of Hardie's older asbestos products." I was familiar with that product based on my experience in the building industry.

92. As [NAME] and I walked in this area, [NAME] pointed out fragments in the excavation where the building waste was buried.

93. At this time and in this area, we also observed a type of pipe and [NAME] made a statement to the following effect: "I haven't seen an asbestos pipe like that for years. There is not much chance of remediating this material as it is mostly demolition waste in the excavation. There won't be much left after you process it. There is too much building waste. It it was dry top soil, it might have been different." 94. [NAME] also made a statement to the following effect: "You can smell the hydrocarbon odour. You should try and mix the material to dry it out and allow the hydrocarbons to break down before it is disposed of so that it reduces the tip fees."

95. I understood that [NAME] was referring to the significant odour of diesel fuels. In my experience, the cost of disposing "hydrocarbon (diesel) affected" soils can be more than double the cost of disposing "asbestos contaminated" soils.

96. In my experience, it is typical that, to reduce this cost, the material is spread out and turned over on site so that the hydrocarbons are evaporated by natural sunlight. Also, to speed up the process, fertiliser can be mixed through the soil every few days. In this way, the material can be later removed as "asbestos contaminated" instead of "hydrocarbon affected". 97. […]

98. During the meeting, we also discussed the following: a) notification to [NAME], that had been given; b) [NAME] requested a schedule of rates for the hygienist, AS2 supervision, plant, labour and disposal.

99. The pothole excavations were left open for [NAME] and [NAME] to inspect at a later site meeting, which was organised on 21 July 2015 and is described in further detail below."

1. In his Affidavit of 8 February 2019, [NAME] said of his visit to the Site in July 2015 (and see, also, T335.20-27 and T338.2-48): "16. I could see many fragments of white material in the surface of the topsoils in the test pit that had been dug. At the time, it appeared there were about 50 pieces of asbestos fragments in the soil at the test pit.

17. As [NAME] progressed through the work under my supervision and established the stockpile for disposal, we encountered many more fragments of asbestos throughout the excavation. We established the stockpile under the direction and supervision of [NAME] ([NAME]) from [COMPANY] ([NAME]), who was appointed by [NAME] as the contaminated land consultant and whom I had worked with on other projects with [NAME].

18. In my experience, where there is that amount of asbestos visible in a test pit, there is likely to be much more asbestos in the underlying topsoils and layers. This is what we found and I saw as [NAME] undertook the works for removal of these soils. […]

24. I recall that on or about 21 July 2018 I received a telephone call from [NAME] who advised me that [NAME] had been instructed to excavate, stockpile and dispose of the contaminated material, under the supervision of [NAME], the contaminated land consultant. [NAME] requested I organise [NAME] and liaise with [NAME] to perform those works as subcontractor, because we held the appropriate license to do so. The removal of the asbestos contaminated material was undertaken by [NAME] under the supervision of [NAME] on 12 August 2018 and 2 September 2018." 1. [NAME] explained at paras 29-30 of his Affidavit why he did not opt for a "spread and pick", which is a possible means of dealing with asbestos fragments.

2. Leaving aside the question of whether a person could confidently assess material as containing asbestos without laboratory testing, which [NAME] and [NAME] were adamant they could do, there was no challenge to the observations of [NAME] and [NAME] of the extent of what they discerned to be asbestos contaminated material. No witnesses, such as [NAME] or [NAME], were called to challenge or dispute the evidence of the witnesses called by [NAME].

The [NAME]

1. The [NAME] (CB A4:1458) was produced by [NAME] on subpoena issued on behalf of [NAME]. There is evidence that [NAME] of [NAME] came to the Site on 13 July 2015: T281.45-50. Given what appears to be a post-it note on the [NAME], its contents and provenance, and [NAME]'s visit to the Site, I draw the inference that the [NAME] is [NAME]'s, that the diagram was created or prepared by him and that it represents what he observed on his visit to the Site. [NAME] has not explained how [NAME] become involved in July 2015 and there is evidence that they were also involved in respect of this matter in August 2015: see CB A6:2031, 2036. 2. [NAME] and [NAME] of [NAME] were both subpoenaed by [NAME] to give evidence at the hearing: see Exhibits 4 and 5. Neither was called by [NAME]. Once again, [NAME] submitted that a [NAME] v [NAME] inference should be drawn. [NAME] contended that there was no need for [NAME] to call either of these witnesses. Given that it appears from the [NAME] that [NAME] visited the Site on 13 July and observed what he considered to be fragments requiring remediation, the inference is that [NAME] considered there to be asbestos containing material on the Site. Also, [NAME] had expressed views on the need for site remediation because of potentially asbestos containing material before [NAME] started work: see [7](8)-(11) and (16) above. I accept [NAME]' submission and conclude that the evidence of these persons would not have assisted [NAME]'s case.

The Site Meeting of 21 July 2015 1. There is no dispute that a Site meeting was held on 21 July and that [NAME] and [NAME] attended it. [NAME] had requested an earlier date and [NAME] had written to [NAME] about it on 10 July 2015. [NAME]'s version of the meeting (from those portions of his affidavits that were read) has these elements:

1. The purpose of the meeting was to discuss the septic tank.

2. He was shown "the excavated hole revealing the sewer pipe/pit said to have been made of asbestos and which would require removal": see [NAME]'s Affidavit of 16 May 2017 para 142.

3. He saw: "[a] small mound of soil not exceeding 10 to 20 tonnes of soil that had been excavated as said to contain asbestos fragments as the sewer pipe/pit has been damaged" (Affidavit of [NAME] dated 16 May 2017 para 143 and Affidavit of [NAME] dated 29 March 2018 para 14).

1. That the only area he saw was the pit immediately next to the "alleged asbestos pipe/pit" (see para 7 of the Affidavit of [NAME] dated 15 March 2019, Exhibit B4).

2. That [NAME] said to him: "- [NAME]: 'This is the asbestos pipe/pit which will need to be removed it is made of asbestos. You can see that it used to run to the old house and those small asbestos fragments have been broken up as we excavated the pipe.' - [NAME]: 'This is not a significant problem if it is asbestos.' - [NAME]: 'This will have to be removed for us to continue our works.' - [NAME]: 'In any event, if it has to be removed provide the costings to [NAME] so that the contract works can proceed.'"

1. That the following conversation occurred at the meeting between [NAME] and [NAME] (see Affidavit of [NAME] dated 29 March 2018, para 17): "- [NAME]: 'Let me know what the works and costs are so that we can sort that out and move on with the contract works.' - [NAME]: 'I will get the costs over to you and we will have reports to confirm that the material is asbestos from our hygienist.'"

1. During his oral evidence (at T143.9-15), [NAME] deposed to having said to [NAME] at the meeting on 21 July 2015 (with [NAME] also being present): "I don't know if that is asbestos, I have no expertise in the area, you will need to get someone to come in here and test it, take the relevant samples, confirm it's asbestos, and then we'll deal with it. If the septic tank has to come out because it's interfering with works then go ahead and remove the septic tank, but as to anything else in terms of asbestos or soils, that are affected by asbestos, it will need to be tested and you will need to get an appropriate expert to deal with it." 1. [NAME]'s evidence as to what occurred on 21 July is as follows (taken from his Affidavit of 29 June 2018)

1. The purpose of the meeting was to discuss removal of the asbestos contaminated soil.

2. That he, [NAME] and [NAME] inspected the potholed areas and that showed the depth of contamination of the fragments in the topsoil and areas of contamination under the clay capping – the demolition material had ponded water around it.

3. That he had a conversation with [NAME] (see Affidavit of [NAME] dated 29 June 2018 para 104) to the following effect: "I said: 'There is a lot of demolition material in the soil. Because of that, there would be little benefit in trying to remediate it. You can generally only screen (process) the material if there is dry topsoil. But this is in clay, and the demolition waste will keep sticking to it. Also, the topsoil was saturated. If we tried to remediate it, most of it would still need to be disposed of offsite anyway.' [NAME]: 'The geotech shows that there was no asbestos in this part of the Site.' I said: 'You can see the asbestos fragments in the ground where the drainage trench went through which was most likely contaminated during the demolition. I don't have a lot of confidence in any geotech investigation for contamination because we have found contamination at numerous locations in [ADDRESS] that have been investigated by geotech firms. It's up to you if you want further investigations before we get on with the works.' [NAME]: 'OK, we don't have much choice, just get rid of it.'" 1. [NAME] says that he understood what [NAME] had said to him as an instruction from [NAME] on behalf of [NAME] to dispose of the asbestos contaminated material off-site (see para 105 of [NAME]'s Affidavit dated 29 June 2018 and to which he adhered in cross examination). 2. [NAME] put to [NAME] that his version of the conversation at T143.10-15 was an utter fabrication (see T143.21) and that he had said nothing of that kind in his earlier affidavits. The major difference between [NAME]'s two versions is that in the second version he instructs [NAME] to obtain samples and says that if they test positive then "we'll deal with it" - nothing other than the septic tank is to be removed. Another divergence is that in [NAME]'s second affidavit he appears to be giving instructions for the sewer pipe and pit to be removed and nothing else, but even in respect of that he wants costings. No costings for removal of the septic tank were sought before [NAME] gave the instruction referred to at [7](22) above.

3. There are a number of reasons why I am inclined to accept [NAME]'s evidence over [NAME]'s and they are:

1. As I have already noted, I have no reason to doubt [NAME]'s credibility and none was suggested – he answered all questions forthrightly and directly made concessions when sought.

2. In relation to [NAME]'s credit:

1. I think that [NAME]'s version at T143 is different in a material respect to what he said in his affidavits (none of which asserted that he had given an instruction to [NAME] to carry out testing). 2. [NAME]'s assertion that the meeting of 21 July was called to deal with the septic tank does not sit comfortably with the fact that he had already given approval for removal of the septic tank on 9 July 2015 (CB A4:1446), and the email of 10 July was clearly answering the much bigger issue of asbestos which included an estimate of $100,000 for removal of asbestos material. [NAME] realistically could not have understood the Site meeting to be in connection with removal of the septic tank. 3. [NAME] told me that he did not know anything about [NAME]'s role until he received the dockets in April 2016 (see T135.29-44), but the email that he received (see CB A4:1520) set out precisely what work [NAME] was to perform. [NAME] required dockets for the disposal and there is evidence they were supplied to him as requested (see [NAME]'s Affidavit of 9 November 2018 paras 38-39, as to which he was not cross examined), contrary to [NAME]'s emphatic assertion to the contrary at T135.40 – T136.6. The certification by [NAME] after he had made clear what he required supports the conclusion that he had been given all that he had required. 4. [NAME] gave a number of unresponsive answers to questions asked of him: see, for example, T124.40, T125.30-44, T137.4, T142.26-42, T145.48, T149.37, T153.26, T154.11, T158.19 and T159.10.

5. As the husband of the proprietor of [NAME] obviously has a real interest in the outcome of this case and the fact that so many paragraphs of his affidavits were not read because [NAME] objected to them because they were submissions and not evidence, suggests that he was [NAME] as an advocate in [NAME]'s cause. Indeed, for a significant period he was [NAME] as solicitor for [NAME] in these proceedings and in his first affidavit that was how he described himself with no reference to his role in the project as [NAME]'s representative: see para 1 of his Affidavit of 16 May 2017.

1. As I have noted, the meeting on 21 July 2015 was not called in order to discuss removal of the septic tank because [NAME] had already instructed [NAME] that [NAME] could proceed to remove it: see CB A4:1446. 2. [NAME] denies that he saw any evidence of asbestos other than around the septic tank, yet [NAME] says that he showed him the potholes that had been created on 13 or 14 July 2015 in which asbestos fragments were found. [NAME] confirmed that on 14 July there were potholes present on the Site in the relevant area. [NAME], in his response to [NAME]'s email in June 2016 (CB A9:3343), reminded [NAME] when [NAME] queried the small number of photographs, that he ([NAME]) had taken other photos and said to [NAME] that: "you were also present that very same day and witnessed the contamination."

3. If it were true that [NAME] had instructed [NAME] to obtain testing it would be expected that when no testing was done and advised to [NAME] that [NAME] would be asking (at least [NAME]) where those results were, and when he learnt that substantial levels of fill had been removed that he would be enquiring why that had been done in contravention of his instructions. No such email or evidence of enquiry has been produced. Not only that, but when [NAME] launched his investigation as to how it was that asbestos was found on the Site even though [NAME] (as he would have it) had not found evidence of asbestos contamination when it investigated the Site in 2014 (or when it gave a clearance for the area of the demolished house in 2015), he did not ask [NAME] why he had allowed the fill removal to proceed. 4. [NAME] understood what [NAME] said to be an instruction to [NAME] to proceed with removal of the fill: see CB A7:2737.

5. Given that [NAME] had said in writing that he would not proceed with work until approval was given by [NAME] (see CB A4:1463), it seems highly unlikely that he would proceed on 21 July 2015 with excavation work if he had not received instructions from [NAME] to do so. Further, given that [NAME] had already involved [NAME] (and [NAME]) on the instructions of [NAME], there was simply no reason for him not to have asked for samples to be taken and laboratory tested if that is what [NAME] had wanted.

6. There is in [NAME]'s evidence a rather obvious link to the case which he now seeks to advance, namely that it is not possible to positively identify asbestos without laboratory testing.

1. In the PCS it is asserted that it is unlikely that [NAME] would have given [NAME] instructions to proceed with removal of the fill without having been given any estimate of cost - "in effect, [NAME] is suggesting that [NAME] was prepared to write a blank cheque" (PCS 40). That submission ignores the fact that [NAME] had in his email of 10 July 2015 given [NAME] an estimate of $100,000 for the work. Further, it ignores that [NAME] had, according to [NAME], given him an earlier verbal estimate of $60,000: see para 120 of [NAME]'s Affidavit of 16 May 2017. [NAME] made it clear that he was basing his estimate on the cost of dealing with a similar problem on an adjoining site but, in any event, it does not matter whether [NAME]'s estimate was soundly based or whether [NAME] relied on that advice from [NAME] in deciding to give the instruction that [NAME] says he did (and which [NAME] asserted later in an email that [NAME] did: see CB A7:2737). It is clear that [NAME] did not provide the estimate of $60,000 or $100,000 to [NAME], but it is also clear that [NAME] had been given an estimate of $60,000 and then $100,000 to deal with the asbestos problem. 2. [NAME], in its submissions and in questions by [NAME] in cross examination, sought to emphasise the absence of any note of [NAME] as to the instructions given by [NAME]. As [NAME] pointed out, given [NAME] is a solicitor who himself made no note of the meeting on what he asserts now were his instructions, [NAME]'s submission on this point has a hollow ring to it.

3. I find as a fact that [NAME], in the presence of [NAME], did instruct [NAME] to proceed with removal of the fill. I find that in undertaking that removal [NAME] was instructed to retain [NAME] (i.e. [NAME]) and [NAME], and, implicitly, that [NAME] would be thereby required to follow the instructions of [NAME] in the excavation, stockpiling and removal of the fill, and in arranging haulage from the Site of any fill so excavated and stockpiled. I am not persuaded that [NAME] made any representation to [NAME] as to the level of fill that should be removed. I find that [NAME] (and, hence, [NAME]) relied on [NAME] for the assessment of what had to be removed by [NAME].

4. I turn now to consider the six elements alleged by [NAME] to constitute the misleading or deceptive conduct of [NAME], identified at [14] above.

5. The Volume Email (see [14](1) above) has not been shown to have been incorrect as to quantity. It can only be the description as "asbestos contaminated material" that is said to be misleading. Since that is how [NAME] characterised the material and required excavation and removal as the remediation plan for that portion of the Site, [NAME] could not have been in any doubt that [NAME] was advising him that 718 m3 of soil had been stockpiled following its excavation and placement, and that it was, on [NAME]'s characterisation, to be regarded as asbestos contaminated fill. In his email of 20 April 2016 (at CB A8:2843), [NAME] said to [NAME]: "The area of 'remediation' is advised by [NAME] at the time that excavation works are in progress. As a qualified hygienist, their role is to direct the remediation works and contractors in accordance with the Remediation Action Plan." This makes it clear that [NAME] did not treat [NAME] as advising him on the correct classification of that material.

1. I find that [NAME]'s representation that 718 m3 of what had become known as the asbestos contaminated fill was not misleading or deceptive in any respect. It was a statement as to the volume of what had been excavated in accordance with [NAME]'s recommendations.

2. There was nothing misleading or deceptive about the rates that [NAME] passed on to [NAME] via the Rates Email: see [14](2) above.

3. In relation to what [NAME] said at T280.15 (see [14](3)), the evidence is evidence of [NAME]'s intention not what he said to [NAME]. In any event, [NAME] had formed the view that there were asbestos fragments present at various locations on Site based on his observations. There is no evidence to support the contention that he did not make those observations or form that view. There is a suggestion that his view - shared by [NAME], and it seems [NAME] (as well as [NAME]) – was flawed and I shall deal with that below.

4. In relation to CB A5:1804-1805 (see [14](4)), again I think that the reference to "asbestos removal" was a shorthand way of referring to the excavated and now stockpiled fill. [NAME] had been on Site when [NAME] had instructed removal of the fill (and appears to have himself concluded that it should be removed in accordance with the NEPM Guidelines: see CB A7:2737). I cannot accept that it is at all likely that he was influenced by the subsequent reference by [NAME] to the fill as asbestos material or asbestos contaminated material.

5. As for the email of 10 July 2015 from [NAME] to [NAME] (see [14](5) above), it is clearly not a communication from [NAME] at all but, rather, from [NAME]. It is not possible to discern from the email that what is stated therein by [NAME] is not [NAME]'s own opinion as opposed to what he has been told by [NAME]. I accept that [NAME] must have told [NAME] that what he had observed was asbestos contaminated material in his opinion, but there is nothing to establish that [NAME]'s assessment was incorrect. Indeed, it is clear based on what [NAME] said to [NAME] on 10 July on Site (see para 81 of [NAME]'s Affidavit of 29 June 2018, the email of 10 July to [NAME], the email to [NAME] at CB A4:1488, CB A9:3343 Items 3 and 35, and CB A7:2737) that [NAME] firmly agreed with that view. [NAME] and [NAME] did as well, and there is no evidence to establish that the material identified by them on visual inspection as asbestos contaminated fragments were not in fact asbestos contaminated fragments.

6. Dealing now with [14](6), this is a rolled up version of what has already been identified, and it rises no higher than its individual elements, none of which, in my view, establish any conduct that amounts to misleading or deceptive conduct on the part of [NAME].

7. I mentioned earlier the suggestion that [NAME] (and [NAME] – and probably [NAME]) could not assess whether or not a particular item contained asbestos or not. There is no dispute that fibres alone cannot be assessed as being asbestos fibres other than by microscopic examination, but [NAME] says that it is possible to identify building products from an earlier period that contain asbestos. The dimpled "golf ball" like appearance of fibre cement sheeting, he says, is an example of something which would lead him to conclude that the product contains asbestos. [NAME] agreed that there are indicators of that kind (T225.26-44), although he said he would treat the product as "potentially asbestos" and could not "determine if it is asbestos until I have tested it in the lab." [NAME] does not, however, have the experience of [NAME] – 7 years compared to 18 years. It seems that there may well be circumstances where an owner of land or the Council, for example, would not be willing to accept that fragments were (or were not) asbestos contaminated without a laboratory test but it does not follow that persons with extensive experience cannot form the view that a product is asbestos contaminated, or very likely asbestos contaminated, and to recommend action on that assumption without laboratory testing. [NAME] did carry out testing of some samples under a microscope: see para 25 of [NAME]'s Affidavit, Exhibit 3, p.

65. The NEPM Guidelines themselves do not require testing: see 4.1-4.9, CB A1:45-49.

8. The NEPM Guidelines contain the following statements that I think bear on this question and support the position of [NAME]: "If visible asbestos is present and it may be disturbed during work activities, it must be removed. This includes removing visible fragments of bonded ACM from exposed trench faces and those areas of the site where intrusive works may be carried out (e.g. to install utilities). The removal of visible asbestos should be appropriately managed and full details recorded (this information is required for assessing asbestos concentration in soil – refer Section 4.10). Visible asbestos should be removed prior to excavation/construction works commencing. Consult the relevant Code of Practice for more detailed information" (see CB A1:46). On the same page is the following: "A competent person is defined in Safe Work Australia (2011a) as a person who has acquired through training, qualification or experience, the knowledge and skills to carry out the task. A competent person in the context of asbestos and the NEPM is a person who has acquired through training, qualification or experience, the knowledge and skills to identify, investigate and assess asbestos in the context of an environmental site assessment. This includes identifying the potential for asbestos contamination from site history information" (see CB A1:46).

1. That [NAME] was a competent person, based on his academic qualifications and experience, was not ultimately challenged, and I think these clauses make it clear that asbestos containing material can be identified by a competent person by visual inspection.

2. There is discernible in [NAME]'s case a complaint that no testing of the fill was undertaken, either in the ground or after its excavation. [NAME] provided support for the view that there should have been, but there is some degree of confusion as to who it is said is responsible for that failure, and this has, it would seem, lead to the case sounding at times as if it is a claim in negligence for not having recommended testing, and one possibly directed not at [NAME] but [NAME] or [NAME]. There is no case of negligence advanced against [NAME], and any failure by [NAME] or [NAME] to recommend testing is completely irrelevant.

3. In the PCS para 46, [NAME] submits that the Court will have to determine: "(a) whether the investigations undertaken by the defendant and its remediation contractors and consultants were capable of identifying that any fill or soil on the site was contaminated with asbestos; […] (c) if any fill or soil on the site was contaminated with asbestos, whether the only acceptable remediation strategy was for the fill and soil to be excavated and stripped from the Site and dumped off-site as 'General Solid Waste Non-Putrescible – Special Waste Asbestos Contaminated'."

1. I have dealt with the first point, although it does not really arise because [NAME] was instructed to proceed as required by [NAME], and the second issue seems to reflect a case against [NAME] or [NAME] that was not brought.

2. I have endeavoured to explain why I do not think that anything said, written or done by [NAME] can be characterised as misleading or deceptive and I have in so doing made reference to [NAME]. A striking feature of [NAME]'s case on the Fill Removal Variation is that it asserts that [NAME] relied on what was said by [NAME] to approve the work to be done and to later certify it, but [NAME] was not called in [NAME]'s case. Whilst in some circumstances it is possible to infer that a person relied on something said by another (see ACCC v TPG Internet Pty Ltd (2013) 250 CLR 640; Hanave Pty Ltd v LFOT Pty Ltd [1999] FCA 357; (1999) 43 IPR 545 and Haros v Linfox [2012] FCAFC 42; (2012) 219 IR 177), the absence of any evidence from [NAME] that he relied on something said by [NAME] is fatal to [NAME]'s claim because it is not at all obvious from the six matters relied on that he did and, indeed, there is evidence that he did not. 3. [NAME] took the view that removal of 718 m3 of fill was unnecessary. In his opinion, what was found and referred to in the [NAME] Notice was a relatively small amount of asbestos that could have been removed in a relatively simple manner. In his report, [NAME] was critical of [NAME] and the [NAME] (see [NAME]' report, Exhibit B5, p. 3-4) and in cross examination was critical of the absence of testing of the soil that was removed and the absence of "substantiation".

4. There are four initial problems with [NAME]' report:

1. Neither his original report nor his supplementary affidavit expresses any conclusion concerning [NAME] - they are, instead, directed against [NAME].

2. In forming his views, [NAME] proceeds on the basis that the only asbestos found on the Site was in one location as reported in the [NAME] Notice (see T191.13-15), whereas the evidence of [NAME] and the [NAME] establishes that there were extensively more asbestos fragments on the Site than is referred to in the [NAME] Notice. [NAME] explained that the reason for the notification was to "get the ball rolling": T333.1-3, T336.32-33. 3. [NAME] was not informed that [NAME] instructed [NAME] to proceed to remove the contaminated fill without requiring any further testing (no doubt because [NAME] denied that he did so).

4. It appears that [NAME] did not take into account that [NAME] was instructed to engage [NAME] and [NAME], and that [NAME] was [NAME] on advice and instructions from [NAME] and [NAME] as to what was required. 5. [NAME] did not take into account the fact that the soils were "heavy clays" (see para 29 of [NAME]'s Affidavit, Exhibit 3, p. 65), and that significant water and hydrocarbons were present in the contaminated areas.

1. The more significant problem with [NAME]' report is that [NAME]'s case against [NAME] is not one in negligence for recommending removal of soil without testing or vicarious liability for the negligence of [NAME] but, rather, that [NAME] engaged in misleading or deceptive conduct. I accept that [NAME]' view is that, based on his assumptions (noting that he never visited the Site at any time), the claim that 718 m3 of fill needed to be removed was not justified. What he is not able to say, and does not purport to say, is that in fact there was no asbestos or very little asbestos in the 718 m3. He is not able to say so because no testing of the 718 m3 was undertaken and because there was, based on the [NAME] Notice which [NAME] relies on, at least some asbestos contaminated material. [NAME] is critical of the fact that no testing was ordered but the fact that it was not ordered means that it cannot be established that there was not an extensive quantity of asbestos contaminated material in the 718 m3 of fill. The evidence of [NAME] and [NAME] as to what they observed, as well as the clayey nature of the soil and the presence of water which makes the task of removing fragments difficult, is unchallenged and no one was called from [NAME] to explain the [NAME]. [NAME] also referred to the stringent attitude of Liverpool Council to asbestos contamination, which was not the subject of any challenge. It is important to reiterate that [NAME] did not recommend how much fill should be removed – that was left to [NAME] of [NAME] to determine and he determined that the fill should be excavated to a depth of 200 mm (see [NAME]'s Affidavit of 2 July 2018 para 52­) or, as [NAME] put it, until "we see natural earth" (T339.23); and see, also, Exhibit 1. 2. [NAME]'s claim on the Fill Removal Variation suffers from further problems. 3. [NAME] is required to establish the loss that flows from the allegedly misleading or deceptive conduct: s 18 of the ACL and Fitzgerald v Deloitte Services Pty Ltd [2017] NSWCA 139. The claimed loss, apparently, is the approximately $330,000 for the Fill Removal Variation.

4. There is evidence that, prior to the adjudications, [NAME] had paid $714,407.67 (see CB A9:3565), but there is no evidence of what precisely the payments were for and the Adjudicators' reasons were not put into evidence by [NAME] (although submissions to the Adjudicators were). [NAME] has not established that it paid the earliest certificates (the first four had elements of the fill removal claims i.e. V01), perhaps because part of its claim (only abandoned in the course of final submissions) was that [NAME] had engaged in misleading or deceptive conduct at the adjudications and because by paras 17 and 36 of the Commercial List Statement, [NAME] puts its claim on the basis that the loss claimed by it is the amounts paid to [NAME] "pursuant to the adjudication determinations". If it is to be inferred that all of [NAME]'s claims for V01 had been paid before the adjudications, then [NAME]'s payment of claims would be further evidence in support of the conclusion that [NAME] was proceeding on the basis that [NAME] (who had certified payment on all of the claims) was [NAME] for the purposes of the Contract. If it cannot be inferred that the claims were paid by [NAME] before the adjudications then it would be necessary to establish why they were paid, which [NAME] has not done.

5. If it is inferred that [NAME] paid the monies it did pay because of the certificates issued by [NAME], it is not established that [NAME] issued the certificates because he relied on anything said by [NAME]. I have identified some of the matters by which he appears to have been influenced and there is another important one – namely, that (accepting, as I do, [NAME]'s version of the conversation on 21 July 2015) [NAME] heard [NAME] instruct [NAME] to proceed to remove the fill.

6. I have referred to the fact that [NAME] did not itself make any assessment of how much fill needed to be removed to deal with the asbestos problem that [NAME] and [NAME] had identified. [NAME] seemed at one stage during the hearing to put a case based on [NAME] having passed on what [NAME] or [NAME] had said concerning the asbestos fragments and how they should be dealt with. In Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592, the High Court by majority held that a real estate agent was doing no more than communicating what the seller was representing without adopting or endorsing it. In the present case [NAME] was instructed to use [NAME] (and [NAME]) and did not actually pass any information on from [NAME] or [NAME] prior to excavation or stockpiling. [NAME] was at the meeting on Site on 14 July 2015 and was present when [NAME] commented on what he observed: see paras 96 and 98 of [NAME]'s Affidavit of 29 June 2018. By describing the fill which had been stockpiled [NAME] was communicating what had been stockpiled in accordance with [NAME]'s requirements. Reference should also be made to CB A7:2736 in which [NAME] said of [NAME]'s claim in his email to [NAME]: "This needs to be paid, the contamination has been remediated, validated and signed off by a hygienist in accordance with the NEPM Guidelines. The contamination was not thoroughly investigated by [NAME] and as a result the full extent of contamination was not known until excavated."

1. Given the matters to which I have already referred, it is not strictly necessary to say any more about the loss and damage, but [NAME]'s case that it would be entitled to the full amount of the Fill Removal Variation seems to proceed on the basis that no cost would have been involved in dealing with the asbestos problem that it now seems to accept existed. It is not just the issue of the cost of testing, as there is evidence that had handpicking been utilised there would have been a cost of approximately $188,000 and the works on Site would have been held up for a period of about 30 days: see [NAME]'s Affidavit paras 52-53, Exhibit 3 p.59. There is also the further complication that what was identified by [NAME] and [NAME] was not only asbestos contaminated material but also hydrocarbons and general waste: see CB A4:1452 and 1453-1459, CB A9:3341, the Affidavit of [NAME] at para 92-95 and the Affidavit of [NAME] dated 2 July 2018, para 67(b). Finally, [NAME] had already advised [NAME] that because of suspected asbestos, actual asbestos found, and uncontrolled fill, a RAP would be needed for the Site.

[NAME] 1. [NAME] contended that [NAME] under the Contract should be viewed as [NAME] and not [NAME]. [NAME] points out that the definition of "[NAME]" speaks in terms of a "person" and that it is unlikely that the corporation was intended to be [NAME]. The schedule as completed is somewhat opaque because it names not only [NAME] but also [NAME], but I accept [NAME]'s argument that [NAME] should be viewed as the person nominated as [NAME] under the Contract.

2. There are a number of indications that, although [NAME] was named as [NAME] in the Contract, he did not perform that role: 1. [NAME] told [NAME] before [NAME] commenced work that "I'll be looking after this one": see T309.46 – T310.5.

2. When [NAME] went on holiday well into the works he told [NAME] to deal with [NAME] whilst he, [NAME], was away, which [NAME] did. 3. [NAME] attended all Site meetings, which were held every fortnight, and also had phone conversations with [NAME] – see T249.31-34. 4. [NAME] attended meetings on 14 and 21 July 2015 for the important issue of asbestos. 5. [NAME] sought instructions regarding the septic tank from [NAME] and [NAME] sought instructions from [NAME]. 6. [NAME] provided an estimate of costs to [NAME] for the asbestos issue. 7. [NAME] signed all of the progress certificates. 8. [NAME] signed the documents granting extensions of time to [NAME] based on rain and other reasons for delay. 9. [NAME] signed the Certificate of Practical Completion.

10. It was to [NAME] whom [NAME] addressed his questions in respect of the Contract in April 2016 and beyond.

11. There is not a single communication in evidence from [NAME] to [NAME] or from [NAME] to [NAME] concerning the matters the subject of this case.

12. There are three variations that [NAME] signed off on but that was in May 2016 and [NAME] said that [NAME] had directed him to deal with [NAME] whilst [NAME] was on leave. Apart from these variations there is no evidence that [NAME] ever acted as [NAME]. 1. [NAME] puts its defence on this issue on these bases:

1. The terms of the Contract – cl 20.

2. Conventional estoppel.

3. Estoppel by representation.

1. In relation to the first point, cl 20 requires [NAME] to ensure that at all times [NAME] fulfils all aspects of the role and functions of [NAME] reasonably and in good faith. [NAME] submits that if, as [NAME] contends, [NAME] was [NAME] then [NAME] has failed to ensure that [NAME] fulfilled all aspects of the role and functions of [NAME] reasonably and in good faith. For reasons which I shall explain, I am of the view that [NAME] and [NAME] were both proceeding on the basis that [NAME] was [NAME] and that [NAME] is therefore estopped from denying that he was [NAME], but if my conclusion on that is incorrect, then I accept [NAME]'s submission that [NAME] breached the Contract by failing to ensure that [NAME] performed his functions as [NAME]. If [NAME]'s contentions are correct then [NAME] has received progress certificates that are of no value or benefit, and has submitted applications for variations and sought instructions that are of no value or benefit to it because [NAME] was not [NAME]. 2. [NAME] maintains that a party cannot take advantage of its own breach of contract and that to recover from [NAME] what was paid to it would amount to just that. The principle that a party cannot benefit from its own breach of contract is well-known in the law: [NAME] (1881) 6 App Cas 251; Alghussein Establishment v Eton College [1988] 1 WLR 587; [COMPANY] v [NAME] Co (A/asia) [COMPANY] (1954) 90 CLR 235; Bragg v Alam [1981] 1 NSWLR 668, 673-674 per Rath J; Ruthol Pty Ltd v Tricon (Australia) [2005] NSWCA 443. It has been observed that the principle that is enunciated in [NAME] v [NAME] has been seen as a case of estoppel: [NAME], Contract Law in Australia (LexisNexis Butterworths, 6th ed, 2013) at 28-09, citing Sprague v Booth [1909] AC 576 at 580.

3. In [NAME] at 246, Dixon CJ said: "it was always the law that, if a contracting party prevented the fulfilment by the opposite party to the contract of a condition precedent therein expressed or implied, it was equal to performance thereof: [NAME] (1787) 1 TR 638 [99 ER 1295]." (Emphasis added)

1. In Hotham (which Dixon J cites in the quote above), the owners of a ship sued charterers for short tonnage (on which freight was to be calculated). The charterers contended that the owners' claim could not be advanced due to the absence of a load certificate upon departure to be given by the charterers or their agents. [ADDRESS], whose opinion was delivered by Ashurst J, noted that the owners had taken all proper steps to obtain the certificate but had not been able to obtain it due to the "neglect and default" of the charterers' agent - the owners' conduct was therefore "equal to performance".

2. For [NAME] to be able to recover from [NAME] money paid to it by virtue of certification by [NAME] because of [NAME]'s failure to ensure that [NAME] was performing his functions would permit [NAME] to take advantage of its own breach of contract and I would refuse the relief sought for that reason.

Estoppel by Convention 1. The principles of estoppel by convention (also known as estoppel in pais) were explained in [COMPANY] t/as Volume Plus v Euphoric Pty Ltd [2007] NSWCA 65; (2007) 69 NSWLR 603 per Tobias JA (with whom Mason P and Campbell JA agreed). His Honour made reference to [NAME] of [NAME] (1986) 160 CLR 226, [NAME] (1937) 59 CLR 641, [NAME] Investment & Property Co Ltd (in Liq) v Texas Commerce International Bank [1982] QB 84, The "Indian Grace" (No 2) [1998] AC 878 and Moratic Pty Ltd v Gordon [2007] NSWSC 5; (2007) 13 BPR 24,713. Tobias JA explained (at [194]) that: "estoppel by convention is a form of estoppel founded upon an assumed state of affairs by the parties whether as to a matter of fact or a matter of legal effect which both will be estopped from denying: [NAME] of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226 at 244–245. That assumed state of affairs takes as a given the terms of the contract as known to and understood by the parties but from which the parties have departed for the purpose of their furtherance of their relationship under the contract." Tobais JA referred (at [195] of [NAME]) to the observation of Dixon J (as his Honour then was) at 676 of Grundt that: "belief in the correctness of the facts or state of affairs assumed is not always necessary. Parties may adopt as the conventional basis of a transaction between them an assumption which they know to be contrary to the actual state of affairs." Tobias JA also cited with approval (at [198] of [NAME]) what had been said by Lord Steyn in The "Indian Grace" at 913: "…an estoppel by convention may arise where parties to a transaction act on an assumed state of facts or law, the assumption being either shared … or made by one and acquiesced in by the other. The effect of an estoppel by convention is to preclude a party from denying the assumed facts or law if it would be unjust to allow him to go back on the assumption."

1. In Moratic (in a passage cited with implicit approval in [NAME] at [100]), Brereton J (as His Honour then was) stated the matters which are required to establish conventional estoppel: "[32] … In common law conventional estoppel, it is necessary for a plaintiff to establish (1) that it has adopted an assumption as to the terms of its legal relationship with the defendant; (2) that the defendant has adopted the same assumption; (3) that both parties have conducted their relationship on the basis of that mutual assumption; (4) that each party knew or intended that the other act on that basis; and (5) that departure from the assumption will occasion detriment to the plaintiff [[NAME] v [NAME], [83], [96]]."

1. It should also be noted that, contrary to [NAME]'s submissions (PCS para 83), it is not necessary that it was conduct of the party against whom the conventional estoppel is asserted that led to the assumption being adopted: see Moratic at [32]-[37] and [NAME] (ed), Chitty on Contract (Thomson Reuters, 33rd ed, 2018) at 4-108.

2. In this case the schedule to the Contract stated that [NAME] of [NAME] was [NAME]. [NAME] was aware that that is what the Contract said (see T309.42) but [NAME], who also was employed by [NAME], had told him he would be looking after the job and [NAME] was aware that [NAME] was intending to, and then did, act in the role. [NAME] understood that [NAME] exercised the role and powers of [NAME] (see para 36 of his Affidavit of 29 June 2018, Exhibit 3, p. 6) and [NAME] adopted the assumption that [NAME] was [NAME], sent all his correspondence to [NAME] and must have observed that [NAME] was in direct contact with [NAME]'s representative, [NAME], that [NAME] gave [NAME] instructions concerning the septic tank and then joined [NAME] on the Site visit on 21 July 2015, and gave instructions as to how the latent defect was to be dealt with.

3. The assumption adopted by [NAME] that [NAME] was [NAME] was also adopted by [NAME]. I say that because: 1. [NAME] was aware that [NAME] was communicating with [NAME] from 8 July 2015. 2. [NAME] was communicating with [NAME] (and not [NAME]). 3. [NAME] attended a Site meeting with [NAME] (and not [NAME]) on 21 July 2015. 4. [NAME] gave instructions to [NAME] with [NAME] present (and [NAME] not present) even on [NAME]'s own evidence. 5. [NAME] knew that [NAME] was giving instructions as to the works and dealing with [NAME] for the purposes of the Contract: T130.35. 6. [NAME] received certificates signed by [NAME] as [NAME] throughout 2015 and 2016 (see T151.15-21). I am unable to accept [NAME]'s contention (T457.46-50) that it cannot be inferred that [NAME], having received the certificates signed by [NAME] as [NAME], would have appreciated that [NAME] was purporting to act as [NAME]. 7. [NAME] never once raised a query with [NAME] as to why he was receiving and dealing with notices from [NAME], or attending Site meetings in place of [NAME] or signing certificates as if he was [NAME].

8. When [NAME] sought answers in 2016 from [NAME] concerning the Fill Removal Variation he never queried why [NAME] signed the certificates as [NAME] or why he purported to act as [NAME] when [NAME] was named as [NAME] in the Contract.

9. There is no evidence of any notification, orally or in writing, by [NAME] to [NAME] that he must stop [NAME] as [NAME].

1. In my view, it is clear that both [NAME] and [NAME] on behalf of [NAME] were proceeding on the basis that [NAME] was [NAME] and both intended that the other would act on that basis. Departure from this assumption would cause [NAME] significant loss because it would potentially entitle [NAME] to recover payments made for work done and approved by [NAME] and entitle [NAME] to recover damages for delay because the named [NAME] had not received the claims for extension and had not approved them. I say 'potentially' because, in fact, [NAME] has led no evidence from [NAME] as to what he would have done had he received from [NAME] what [NAME] received from [NAME] (other than the three variations he did approve which, until final submissions, [NAME] also claimed should not have been paid). I infer that [NAME]'s evidence would not have assisted [NAME]'s case. 2. [NAME] maintained that the [NAME] estoppel claim could be founded only on conduct occurring between the commencement of the Contract (June 2015) and the date that all of the excavated fill was removed from Site. The first progress claim was issued on 21 August 2015 after the great bulk of fill had been removed. It was pointed out in the PCS that there was no evidence that [NAME] had told [NAME] to approach [NAME] or to submit its documentation or claims to [NAME]. I accept these submissions in relation to the claim of estoppel by representation but they do not have any force in relation to estoppel by convention. The issue which I have to determine in that context is whether [NAME] and [NAME] were, in their dealings under the Contract, proceeding on the assumption that [NAME] was [NAME]. I think it is appropriate to consider the entire period from the commencement of the Contract to such time as the work was completed, not just the first few months of the Contract. Even for that limited period, there is evidence that both [NAME] and [NAME] were proceeding on the basis that [NAME] was [NAME] but this is strengthened by the receipt by [NAME] of certificates signed by [NAME] as [NAME] and the payment by [NAME] to [NAME] based on some, at least, of those certificates. It is true that [NAME]'s email bore the description beneath his name "project manager" but I do not think that is inconsistent with him [NAME] as [NAME] under the Contract.

3. In the PCS, [NAME] seeks to advance an argument that even if [NAME] is to be treated as [NAME] was not entitled to recover for the Fill Removal Variation because (see PCS para 93): "(a) the fill and soil removed from the Site was not in fact contaminated with asbestos or was not contaminated to the extent claimed by the defendant, and (b) therefore it was not necessary or reasonable for the defendant to perform the work the subject of the Asbestos Claim and so the defendant is not entitled to recover payment for that work under the Contract, notwithstanding that [NAME] as [NAME] approved the work."

1. The following further submissions are made in the PCS (at paras 94-100) in relation to that point:

1. The variation power in a construction contract cannot be used to effect "a fundamental change of the works to be done under the contract": see Melbourne Harbour Trust Commissioners v Hancock (1927) 39 CLR 570, 586 per Isaacs J.

2. The exercise of the variation power is subject to reasonableness: see, e.g. Wegan Constructions Pty Ltd v Wadonga Sewerage Authority [1978] VR 67; (1977) 36 LGRA 147 at 69.

3. The exercise of the variation power in a construction contract is subject to the implied duty of good faith: see, e.g. [COMPANY] v Minister for Public Works (1992) 26 NSWLR 234.

4. The Final Certificate has not yet been issued – cl 37.2 is relied on. 5. [NAME] is only to be paid for work as a variation under cl 36 of the Contract if the work was (a) in fact carried out; and (b) if the work was "necessary and reasonable for the defendant to carry out in order to complete the work under the Contract": see, e.g. Plaza Pty Ltd v Simon's Earthworks (NSW) Pty Ltd [2010] NSWSC 1426.

6. The work carried out was not necessary or reasonable for [NAME] to carry out because the Site "was not in fact contaminated with asbestos" or "was not contaminated to the extent claimed by [[NAME]]", so that the "wholesale removal and dumping" of fill was not necessary or reasonable. 1. [NAME] has not established that the fill that was removed did not contain asbestos contaminated materials or, if it did, in what levels. [NAME] was instructed to have [NAME] remove the fill as recommended by [NAME], i.e. in accordance with the RAP.

2. That is sufficient to deal with this aspect of [NAME]'s contentions but I should also make the following observations: 1. [NAME]'s email of 13 July 2015 (CB A4:1463) constitutes written notice of asbestos. The presence of asbestos contaminated material was a latent defect which triggered operation of cl 25.3, but, in any event, removal of fill that contained asbestos contaminated material or was thought to contain asbestos fragments was not a fundamental change of the works. The principle identified in Melbourne Harbour is dealing with the question of whether [NAME] can vary the contract in a radical fashion (in that case removal of works from the Contract). That is linked to the principle of reasonableness as in Wegan, and the implied duty of good faith. Clause 36.1 of the Contract seems to reflect a similar protection of the contractor here. The present circumstances raise none of these issues.

2. Plaza is a case of misleading or deceptive conduct and the tort of deceit. [NAME] was held to have relied on a number of false representations made by the contractor, including that material removed from the site was contaminated when in fact it was, to his knowledge, not contaminated. Plaza does not support the second of the two principles attributed to it in the PCS (see [75](5) above and PCS paras 98-99), namely that the work the subject of the variation must be "necessary and reasonable for the defendant to carry out in order to complete the work under the Contract," and that if it was not necessary and reasonable, [NAME] would be able to sue the contractor for the money paid out for that work, even if [NAME] had already certified it and the contractor had not engaged in misleading or deceptive conduct. 3. [NAME] decided to deal with the existence of asbestos contaminated fill on the Site by directing its removal with the involvement of remediation specialists, the work undertaken was reasonably necessary whatever the precise concentration of asbestos fragments in the fill removed. The certification by [NAME] confirms that that was so.

4. Whilst cl 37.2 provides that neither a progress certificate nor payment "shall be evidence that the subject work has been carried out satisfactorily", there is no evidence that the work was not carried out satisfactorily - what is put by [NAME] is that the work was not necessary. [NAME] was instructed by [NAME] to remove the fill and, implicitly, to do so in accordance with the recommendations of [NAME] and using [NAME], which was appropriately licensed to deal with asbestos contamination material. Having carried out the excavation and stockpiling, [NAME] was instructed to arrange for disposal of the 718 m3 of fill, which it did. 1. [NAME] contended that even if [NAME] did give instructions to [NAME] in the presence of [NAME], the instruction was not one that [NAME] could rely on: see T392.41 – T393.1.

2. Having regard to para 23 of [NAME]'s List Statement, to which I have referred at [12] above, I doubt that such a claim is open to be made by [NAME] but, in any event, where: 1. [NAME] under a building contract, in the presence of [NAME], instructs the contractor to carry out work to deal with a latent defect following a meeting called to determine what action should be taken to deal with the latent defect;

2. The contractor acts on the instruction so given and arranges for excavation; 3. [NAME], in writing, instructs the contractor to dispose of the fill from the site;

4. The contractor incurs liability to third parties as a result of [NAME] on the instructions; 5. [NAME] later certifies that the work carried out by the contractor requires payment by [NAME]. I do not think it is open to [NAME] to refuse payment (or, as here, seek to recover payment) because [NAME] did not give written instructions to excavate (but does give written instructions to remove the fill). It might be seen as another example of conventional estoppel (i.e. that the parties were proceeding on the basis that written direction was not required) or on the basis that [NAME] failed to ensure that [NAME] (or, alternatively, [NAME]) issued a written instruction to [NAME] to reflect [NAME]'s instructions as communicated by [NAME].

1. Another issue raised by [NAME] related to the extensions of time granted - he asserted that these were lodged out of time. [NAME] pointed out correctly that cl 41.2 makes it clear that failure to communicate a claim within the time required by the Contract might entitle the other party to damages for a breach but does not bar or invalidate the claim.

2. Yet another argument advanced was that there was no written notice given by [NAME] to [NAME] for the variation. [NAME] did give written notice of the existence of asbestos (see CB A4:1463, with the subject line: "Asbestos"), and [NAME] drew attention to cl 25.3 of the Contract which provides that the effect of the latent condition shall be a deemed variation, which answers that point.

The Liquidated Damages Claim 1. For the reasons already given, [NAME] is unable to circumvent extensions given and decisions made by [NAME], but there is an even more fundamental problem with [NAME]'s claim. Clause 34.7, which provides for liquidated damages, requires certification by [NAME] and no such certification by [NAME] ([NAME] or [NAME]) is in evidence. Therefore, no money can be claimed, even for the period between 24 August 2016 and 2 September 2016.

The Miscellaneous Variations 1. [NAME] basis of [NAME]'s claim on the Miscellaneous Variations is that [NAME] was not authorised to act as [NAME] under the Contract. I have rejected that assertion, but there were some additional aspects of these variation claims with which I shall now deal.

2. Each of these was the subject of detailed evidence from [NAME], summarised in DCS paras 142-154, the evidence being from both the Court Book and oral evidence, and which I accept. It is clear that some of these variations were the subject of a written direction and some oral only. Leaving aside the point about [NAME]'s position as [NAME], with which I have already dealt, I do not think it can be open to [NAME] to resist payment of a claim certified by [NAME] because the contractual requirements for approval by [NAME] were not adhered to. Whether this is because the certificate has contractual force or because reliance on [NAME]'s failure to issue a written direction would amount to another example of relying on [NAME]'s failure to ensure that [NAME] was performing his task adequately, or as estoppel or because the certificate must be taken to be a decision by [NAME] on behalf of [NAME] not to require strict adherence, is probably not necessary to decide, because the absence of the "final certificate" is another example of [NAME]'s failure to ensure that [NAME] fulfilled all aspects of his role and functions reasonably and in good faith. [NAME] refers to the absence of the final certificate (see para 48 of his third affidavit) but there is no reason given for [NAME]'s failure to issue the "final certificate" under cl 37.4, with the consequences of such a certificate there set out. In accordance with the principle identified earlier, [NAME] cannot rely on the absence of a final certificate, and that precludes it from relying on any failure of [NAME] to issue a written direction.

3. The DCS refer to Acohs Pty Ltd v Ucorp Pty Ltd [2012] FCAFC 16; (2012) 201 FCR 173 at [200], in which the principle of not being able to approbate and reprobate is discussed. The judgment refers to the expression of principle in Express Newspapers plc v News (UK) Ltd [1990] 3 All ER 376; (1990) 18 IPR 201 by [NAME] at 383-384, the comments of [NAME] in Mandurah Enterprises Pty Ltd v Western Australian Planning Commission [2008] WASCA 211; (2008) 38 WAR 276 and what was said by [NAME] (as his Honour then was) in Commonwealth v Verwayen (1990) 170 CLR 394, 421. The DCS draws attention to the fact that [NAME]'s Second Further Amended List Statement asserts that [NAME] was misled in issuing instructions to [NAME] and this seems to implicitly involve an assertion that he was [NAME] as agent of [NAME] in so doing. Whilst I think that there may well be scope for a separate doctrine rather than as just a form of election waiver or estoppel, I do not think that it is necessary to embark upon an examination of this topic here. I note too that the asserted case in the List Statement seems to be inextricably bound up with the adjudications, but allegations that [NAME] engaged in misleading or deceptive conduct in connection with the adjudications were expressly eschewed, along with a number of other claims, at the time of final oral submissions: see T441.10 – T442.24.

Quantum Meruit 1. In relation to the quantum meruit claim, [NAME], through the PCS, accepts that [NAME] might be able to claim on a restitutionary or quantum meruit basis (see Liebe v Molloy (1906) 4 CLR 347 and Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221), but contends that [NAME] would have to prove the value or benefit received by [NAME] from the work the subject of the Fill Removal Variation. [NAME] contends that that would require [NAME] to prove that the fill and soil were in fact contaminated by asbestos and that it was therefore necessary for [NAME] to carry out the work to remove the soil. In circumstances where, as I have found, [NAME] did instruct [NAME] to proceed with the work, notwithstanding the absence of further investigations (which had been offered by [NAME]) and the instruction to [NAME] (using [NAME] and [NAME]) to proceed, as well as the compliance by [NAME] with the recommendations of [NAME] of [NAME], I do not think that [NAME] is required to prove anything further. [NAME] has obtained a clean Site, known to be free of asbestos contaminated material, enabling it to proceed with development of the Site, as instructed. If [NAME] wanted each area to be tested for asbestos fragments before excavation commenced, or before removal from the Site, then it was incumbent on [NAME] to so direct, which it did not do.

2. Therefore, had I found that [NAME] was not estopped from denying [NAME]'s authority and was not in breach of the Contract by failing to ensure that [NAME] performed his duties, I would have found [NAME] entitled to the amount asserted by [NAME], namely $467,076.18, Exhibit 3 p. 90.

Conclusion 1. On [NAME]'s claim there should be judgment for [NAME]. [NAME] conceded that [NAME] was entitled to recover the amount of $24,723.68, subject to [NAME]'s claim. There should be judgment for [NAME] on its cross claim in the amount of $24,723.68.

Costs 1. The parties were agreed that I should defer the issue of costs until after my decision on the matters covered in these reasons.

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