24/01/2018 - 13:46

Perth Airport wins contractor dispute

24/01/2018 - 13:46

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Construction company Built Environs has failed in its attempt to claw back $14.5 million of performance bonds used by Perth Airport to cover liquidated damages associated with development of the new terminal buildings in 2015.

Perth Airport wins contractor dispute
Built Environs was awarded a $172.7 million contract by Perth Airport.

Construction company Built Environs has failed in its attempt to claw back $14.5 million of performance bonds used by Perth Airport to cover liquidated damages associated with development of the new terminal buildings in 2015.

The Supreme Court this week published a judgement on the case, dismissing Built Environs claim and upholding a counterclaim by the airport owner.

Built Environs was awarded a $172.7 million contract by Perth Airport in February 2013 for the construction of the Virgin domestic pier and expansion of the international departures area.

The construction company claimed that Perth Airport wrongfully obtained $14.5 million for liquidated damages.

Its claim was based on an email from the airport’s executive general manager, Guy Thompson, to Built Environs managing director Daryl Young, which it argued was evidence of a binding agreement.

However, Justice Paul Tottle said the email was not binding.

“For the reasons given in the judgment I held that the email of December 2, 2015 did not constitute a binding agreement,” he said

“I held that even if the email ... had constituted a binding agreement, PAPL did not breach its terms.

“I also held that no estoppel of the nature for which Built Environs contended arose.

“I dismissed Built Environs' action.”

In the email, Mr Thompson said Perth Airport would not recover the liquidated damages subject to conditions.

The conditions included the construction company not advancing any claims against the airport until dispute talks had finished.

The judgement also upheld a counterclaim from the airport operator that it was entitled to succeed on a claim for monies due to it by Built Environs.

This action is part of a large litigation dispute which is still progressing through its interlocutory pleading phases.

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