Laing O’Rourke Australia Construction Pty Ltd v Kawasaki Heavy Industries Ltd [2017] NSWSC 541

Laing O’Rourke Australia Construction Pty Ltd v Kawasaki Heavy Industries Ltd [2017] NSWSC 541

There is a serious question to be tried as to whether Kawasaki is entitled to call on the Laing O'Rourke Bonds absent a call by JKC on the Kawasaki Bond. The proper construction of cl 14 of the Consortium Agreement and Art 6 of the Purchase Order strongly suggests the parties intended Kawasaki to only call on the bonds if JKC has called on the Kawasaki Bond. The balance of convenience overwhelmingly favours the continuation of the injunction.

Parties
Plaintiff/applicant: Laing O'Rourke Australia Construction Pty Ltd; Defendant/respondent: Kawasaki Heavy Industries Ltd
Jurisdiction
Australia
Judgment Date
05 May 2017
Procedural Posture
Contract/interlocutory Injunction / Interlocutory, Continuation of Injunction Pending Arbitration
Outcome
Interlocutory injunction restraining Kawasaki from calling on the Laing O'Rourke Bonds continued pending determination by arbitral tribunal.
Legal Topics
Performance Bonds, Consortium Agreement, Interlocutory Injunctions, Conditions Precedent, Construction of Commercial Contracts
Contract Law Equity Construction Law Performance Bonds Consortium Agreement Interlocutory Injunctions Conditions Precedent Construction of Commercial Contracts

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Parties

Laing O'Rourke Australia Construction Pty Ltd

Plaintiff/applicant

Kawasaki Heavy Industries Ltd

Defendant/respondent

Procedural Posture

Contract/interlocutory Injunction / Interlocutory, Continuation of Injunction Pending Arbitration

Legal Issues

  1. 1 Whether Kawasaki is entitled to call on the Laing O'Rourke Bonds absent a call by JKC on the Kawasaki Bond
  2. 2 Whether the condition precedent for a call on the bonds is satisfied
  3. 3 Proper construction of the Consortium Agreement and Purchase Order regarding entitlement to call on the performance bonds

Ratio Decidendi

There is a serious question to be tried as to whether Kawasaki is entitled to call on the Laing O'Rourke Bonds absent a call by JKC on the Kawasaki Bond. The proper construction of cl 14 of the Consortium Agreement and Art 6 of the Purchase Order strongly suggests the parties intended Kawasaki to only call on the bonds if JKC has called on the Kawasaki Bond. The balance of convenience overwhelmingly favours the continuation of the injunction.

Court Disposition

Interlocutory injunction restraining Kawasaki from calling on the Laing O'Rourke Bonds continued pending determination by arbitral tribunal.

Orders

  • The interlocutory injunction ordered by Ball J on 15 March 2017 is continued. Parties are invited to bring in short minutes to give effect to the reasons.