John Grant and Sons Limited v Trocadero Building and Investment Company Limited [1938] HCA 20

John Grant and Sons Limited v Trocadero Building and Investment Company Limited [1938] HCA 20

A builder who holds a valid progress certificate given by the architect under the contract is entitled to payment of the amount certified; the arbitration clause does not bar action for such payment unless the dissatisfied party has activated arbitration by giving notice as required; performance of requirements for vouchers or statements is not a condition precedent to the architect's power to certify or to the builder's right to payment under the certificate.

Parties
Appellant; Plaintiff: John Grant and Sons Limited; Defendant; Respondent: The Trocadero Building and Investment Company Limited
Jurisdiction
Australia
Procedural Posture
Appeal / Appeal From Decision on Demurrers and Cross Demurrers in the Supreme Court of New South Wales
Outcome
Appeal allowed with costs.
Legal Topics
Building Contracts, Progress Payments, Arbitration Clauses, Interpretation of Contract Conditions, Pleading and Procedure on Demurrer
Contract Law Arbitration Building Contracts Progress Payments Arbitration Clauses Interpretation of Contract Conditions Pleading and Procedure on Demurrer

Case Brief

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Parties

John Grant and Sons Limited

Appellant; Plaintiff

The Trocadero Building and Investment Company Limited

Defendant; Respondent

Procedural Posture

Appeal / Appeal From Decision on Demurrers and Cross Demurrers in the Supreme Court of New South Wales

Legal Issues

  1. 1 Whether the issue of a progress certificate by the architect entitles the builder to payment despite the arbitration clause.
  2. 2 Whether disputes surrounding progress certificates must be referred to arbitration before legal action may be brought.
  3. 3 Whether compliance with conditions relating to vouchers or detailed statements are conditions precedent to the architect's power to certify.

Ratio Decidendi

A builder who holds a valid progress certificate given by the architect under the contract is entitled to payment of the amount certified; the arbitration clause does not bar action for such payment unless the dissatisfied party has activated arbitration by giving notice as required; performance of requirements for vouchers or statements is not a condition precedent to the architect's power to certify or to the builder's right to payment under the certificate.

Court Disposition

Appeal allowed with costs.

Orders

  • Judgment in demurrer for the plaintiff on the first, second, fifth, sixth, tenth, eleventh, and twelfth pleas and on the fifth replication to the ninth and thirteenth pleas by way of cross-action.
  • Judgment for the plaintiff generally upon the demurrers in the action and cross-action.