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Disputes can be complex, costly and disruptive, with significant implications for all parties involved. Our Dispute Resolution & Litigation practice delivers strategic, cost-effective solutions to complex legal challenges. We prioritise swift resolution, proactive risk management and commercially focused outcomes, always with our clients’ business objectives in mind.

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Dispute Resolution & Litigation

Ad hoc and Institutional Arbitration

Arbitration is an increasingly preferred alternative to traditional litigation, particularly in commercial and international disputes. For businesses engaged in cross-border transactions, especially within the Asia-Pacific region, choosing between institutional and ad hoc arbitration can significantly influence the efficiency, cost and enforceability of dispute resolution. This article outlines key differences and practical considerations to help parties make informed decisions. Institutional Arbitration Institutional arbitration is conducted under the rules of a recognized arbitral institution, such as the Singapore International Arbitration Centre (SIAC), Hong Kong International Arbitration Centre (HKIAC) or the Australian Centre for International Commercial Arbitration (ACICA). These bodies offer a structured procedural framework and dedicated administrative support. The benefits of institutional arbitration include clearly defined rules that reduce procedural uncertainty, experienced panels of arbitrators and stronger international recognition of awards. Importantly, parties do not need to negotiate fees directly with arbitrators, as institutional rules often prescribe a fee schedule or allow the institution to manage these arrangements. The presence of a secretariat or case management team ensures that timelines are monitored and adhered to, minimizing procedural delays. Institutions also handle logistical and ancillary services such as transcription, interpretation, and hearing room bookings, relieving parties of the administrative burden. While institutional arbitration is often associated with higher administrative costs and reduced procedural flexibility, many institutions now offer streamlined rules and expedited processes to balance efficiency with oversight. Some institutions even extend their facilities, such as venues and financial administration services, to support ad hoc arbitrations, providing a hybrid option that blends autonomy with professional support. Ad hoc Arbitration Ad hoc arbitration does not involve an administering institution. Instead, the parties themselves agree on procedural rules, nominate arbitrators and manage the process independently. This approach offers greater flexibility and can be more cost-effective in the right circumstances. The appeal of ad hoc arbitration lies in its autonomy and adaptability. Parties can customise procedures to suit their commercial needs, potentially achieving faster outcomes with reduced expense. However, without institutional support, parties must arrange all aspects of the process, including arbitrator appointments, fee negotiations and ancillary services. This lack of infrastructure can lead to delays, especially when parties are uncooperative or disputes arise about procedure. Additionally, enforcement of awards may be more difficult if procedural irregularities affect the arbitration’s perceived legitimacy. Strategic Considerations for PartiesFor businesses operating in the Asia-Pacific, selecting the right arbitration model depends on factors such as dispute complexity, anticipated costs, international enforceability and the likelihood of party cooperation. Institutional arbitration is generally better suited to large-scale, cross-border disputes where predictability, enforceability and reputational assurance are important. The procedural structure and secretariat support offered by institutions can be critical in managing complex cases and ensuring compliance with deadlines. In contrast, ad hoc arbitration may be appropriate for smaller claims or domestic matters where parties are aligned on process and cost considerations and may still benefit from certain institutional services when needed. Ultimately, well-drafted arbitration clauses are essential. Legal advice at the contract negotiation stage can ensure that the chosen arbitration method aligns with a company’s broader commercial objectives and mitigates legal risk. As arbitration continues to expand across the region, businesses would do well to engage counsel experienced in both institutional and ad hoc frameworks to guide their approach. ConclusionWhile both institutional and ad hoc arbitration have their respective merits, the growing preference for institutional arbitration, reflected in a 2015 survey where 79 per cent of users opted for institutional mechanisms, underscores its practical advantages in the context of international commercial disputes. Institutions offer procedural certainty, administrative support, and enhanced credibility of awards, which are crucial when dealing with complex, cross-border matters. Additionally, the elimination of direct fee negotiations with arbitrators and the availability of ancillary services contribute to a smoother and more reliable process. Although institutional arbitration can be more costly and less flexible, its structured framework often proves more dependable, particularly where cooperation between parties is limited. Ultimately, the decision between institutional and ad hoc arbitration should be informed by the specific needs of the parties, the complexity of the dispute, and the importance of enforceability and procedural support.  

Dispute Resolution & Litigation

How Can International Arbitration Be Made Cost Effective?

Making International Arbitration More Cost Effective International arbitration remains a preferred method for resolving cross-border disputes, especially in the Asia-Pacific. However, the process can be costly and protracted, often attracting criticism from commercial parties who seek timely and efficient outcomes. As arbitration continues to evolve in the region, cost effectiveness requires coordinated efforts from parties, arbitrators, institutions and legislators alike. Enhancing Efficiency Through Strategic PlanningMuch of the responsibility for controlling arbitration costs lies with the parties and their legal representatives. Early case assessment and a clear procedural strategy can significantly reduce inefficiencies. By developing a well-defined case theory from the outset, parties can better assess settlement options and avoid unnecessary procedural steps. Importantly, parties should give more thought to dispute resolution clauses before a dispute arises. Too often, these clauses are treated as boilerplate without due consideration of their strategic impact. This is the moment to agree to mechanisms that can streamline future proceedings, such as adopting the IBA Rules on the Taking of Evidence in International Arbitration, which typically provide for more limited disclosure than common law approaches. Likewise, agreeing on the preparation of core document bundles and the use of admissions, even where these may be unfamiliar in civil law jurisdictions, can help narrow the factual issues in dispute and avoid unnecessary fact-finding. Choosing the right arbitrator is equally critical. Opting for a sole arbitrator, particularly one with availability and relevant industry experience, can eliminate the risk of scheduling conflicts and streamline decision-making. This is especially important in the Asia-Pacific region, where access to experienced arbitrators is competitive. Technology also plays a key role in reducing costs. Remote hearings now offer a practical alternative to in-person appearances, eliminating travel expenses and enabling greater flexibility in scheduling. Additionally, focusing on essential evidence and narrowing the scope of issues helps prevent the arbitration process from becoming unnecessarily prolonged. Arbitrators as Drivers of Procedural Efficiency Arbitrators play a pivotal role in setting the tone for an efficient process. Active case management, through clear timelines, procedural orders and firm expectations, helps ensure alignment throughout the arbitration. A key efficiency measure is for arbitrators to clarify the live issues early on, either by preparing their own list for party comment or asking the parties to jointly define them. This can dramatically reduce the time spent arguing peripheral matters. While arbitration is, to some degree, the parties' process, arbitrators should not be overly deferential. Effective case management may require firm intervention. Arbitrators should feel confident using procedural tools such as bifurcation, summary dismissal, or early partial awards, and they should not be deterred by concerns that being prescriptive might affect future appointments or trigger challenges to the award. The tribunal has a responsibility not only to the parties but also to the integrity of the arbitral process. Limiting the volume of submissions and requiring parties to justify the relevance of their evidence are further levers that tribunals can use to ensure the arbitration stays focused and proportionate. Arbitrators should also remain alert to opportunities for early settlement. In jurisdictions such as Singapore and Hong Kong, where mediation is well integrated, they can encourage or facilitate early resort to alternative dispute resolution (ADR) mechanisms. Institutional Support and Legislative Reform Arbitral institutions in the region, including the Singapore International Arbitration Centre (SIAC) and the Hong Kong International Arbitration Centre (HKIAC), have taken steps to improve procedural efficiency. Many now offer expedited procedures that compress timeframes and reduce unnecessary steps, making them ideal for less complex or lower-value disputes. Institutions can go further by actively managing arbitrator availability, enforcing award delivery timelines, and promoting the use of ADR within the arbitration process. In countries such as Australia and New Zealand, where mediation is common, institutions could empower tribunals to stay proceedings to allow for meaningful settlement discussions. Legislation also plays a role. Clear statutory endorsement of summary procedures and expedited mechanisms can remove uncertainties about their enforceability and encourage broader adoption. Recent reforms in arbitration laws across the Asia-Pacific reflect a growing appetite for speed and economy in international arbitration. Practical Steps to Consider To maximise cost efficiency, parties and legal representatives should: • Carefully negotiate dispute resolution clauses during contract formation, considering procedural rules (e.g. IBA Rules) that limit scope and disclosure. • Include pre-arbitration settlement or ADR clauses in contracts. • Agree early on procedural matters such as timelines, core bundles and potential admissions. • Engage experienced arbitration counsel familiar with regional practices. • Limit evidence and witnesses to those strictly necessary. • Consider remote hearings wherever appropriate. Conclusion Cost effective arbitration is not achieved through isolated efforts. Instead, it requires a coordinated approach involving proactive parties, decisive arbitrators, supportive institutions and forward-looking legislation. By embracing efficient case management, agreeing procedural rules and issues upfront, leveraging technology and adopting expedited procedures, international arbitration can continue to serve as a reliable and commercially viable dispute resolution mechanism, particularly for businesses operating across the Asia-Pacific.  

Dispute Resolution & Litigation

Security of Payment NSW - Know your right to receive progress payments for construction works and related goods and services

As a direct or indirect result of the COVID-19 pandemic and uncertainty in a global economy, various issues have been adversely impacting the construction industry, such as an increase in raw material price and supply chain disruption. Particularly, contractors and subcontractors are struggling with their cash flow due to their outstanding payments for the works carried out. Accordingly, security of payment legislation in each state has played a role in ensuring that anyone carrying out construction work, and supplying related goods and services under a construction contract gets paid promptly. This article discusses and explains your rights under the NSW Security of Payment Act, and each state has its own security of payment legislation, which may differ from each other in detail.   Know Your Rights In New South Wales, the relevant security of payment legislation is the Building and Construction Industry Security of Payment Act 1999 (NSW) (“SOPA”). The significance of the SOPA is that it grants contractors rights to receive progress payment even if there is no formal written contract or even if a contract says that you are only allowed to receive a payment at the end of works, i.e., after the completion of works. Fundamentally, the SOPA entitles a person or a company, who carried out construction work or supplied construction related goods and services, to receive progress payment. A progress payment means a partial payment for works as the project progresses even if the assigned works are not completed. Therefore, the progress payment facilitates cash flow for contractors and suppliers in the construction industry. Under SOPA, the following rights are granted to you:         A right to receive a progress payment at least on a monthly basis;         Maximum time limits to respond to claims for progress payments;         Maximum payment terms;         A right to suspend work in the event of non-payment;         No ‘pay when paid’ clause: No need to wait until a contractor you worked for gets paid by a head contractor or principal; and         Interest rates applicable on unpaid progress payment.   Who is entitled to receive a progress payment? A person or company who, under a construction contract or any other construction arrangement, has undertaken to carry out construction work or supply construction related goods or services in New South Wales is eligible to receive a progress payment under the SOPA.[1] The “construction work” is broadly defined, including construction, alteration, repair, maintenance or demolition of buildings or structures forming part of land.[2] The “related goods and services” also include various related goods and services such as materials for construction or plant for use in construction work, labour service, design or engineering service.[3] While the SOPA is drafted to cover contractors, subcontractors, suppliers and service providers as broadly as possible, it should be noted that there are also exceptions such as those engaged in the extraction of oil, natural gas or minerals.   Payment Claims The procedure for receiving a progress payment is triggered by a person entitled under the SOPA (Claimant) making a Payment Claim in writing to the other person who is responsible to make a payment under a construction contract (Respondent) In making a Payment Claim, Claimants must ensure that the following requirements are met:[4] 1) The construction work related to the progress payment must be identified; 2) The amount of the progress payment must be indicated; 3) A statement that a Payment Claim is made under this SOPA must be inserted; 4) A Payment Claim must be served on the Respondent within 12 months after the construction work was last carried out; and 5) A Payment Claim is only made one (1) time in a month on and from the last day of each month in which the construction work was carried out.   How to respond to a Payment Claim? The Respondent is required to respond to the Payment Claim by providing a Payment Schedule to the Claimant within 10 business days after receipt of the Payment Claim. By failing to do so, the amount claimed in the Payment Claim is fixed and Respondents are liable for such amount on the due date. In issuing a Payment Schedule, Respondents also are required to comply with the following requirements:[5] 1) A Payment Claim related to a Payment Schedule must be identified; 2) The amount of the payment the Respondents propose to make must be indicated; and 3) If applicable, reasons why the amount in the Payment Schedule is less than that in the Payment Claim and reasons for withholding payment must be identified.   Maximum payment terms One of the most important benefits available under the SOPA is that there are statutory deadlines for a progress payment to be made.[6] If the Respondents fail to pay the progress payment by the deadline in the diagram below, such amount is deemed due and payable, and interest on the unpaid amount is also payable at the prescribed rate. Your rights to suspend works A Claimant also has a right to suspend construction work or supply of related goods and services if a Respondent fails to pay the amount by the due date for payment as described above.[7] At least two (2) business days prior to the suspension, the Claimant must serve on the Respondent a Notice of Intention to Suspend Work in writing. As the date on which the Notice is given is not counted, the Claimant is eligible to suspend work on and from the fourth day of the Notice. Please see the above diagram. Once the work is suspended under SOPA, the Claimant is not liable for any loss or damage suffered by the Respondent as a result of such suspension. However, once the whole outstanding amount is paid, the Claimant must resume the work within three (3) business days from the payment date.   Don’t wait until a head contractor gets paid The SOPA expressly prohibits and invalidates any clause in a construction contract that the payment of money is contingent on a milestone or an event in other contracts including a head contract.[8] A common example of these clauses is that a payment under a subcontract is made upon the payment by a principal under a head contract or upon the practical completion of a head contract. Such clauses are deemed unenforceable under the SOPA, and you have a right to claim the progress payment regardless of the operation of other contracts.   Adjudication A person eligible under the SOPA also can start an adjudication process for unpaid or disputed progress payments. Adjudication is an informal and independent process which an issue or issues are determined by an independent adjudicator regarding the payment claims. The adjudicator’s determination can be enforced as if it is a judgment rendered in a Court. However, the Claimant must file an adjudication application in writing by the following deadlines:[9] Type Deadline When: 1)        Respondent issues a Payment Schedule, and 2)        the amount in a Payment Schedule is less than the amount in a Payment Claim Within 10 business days after a Payment Schedule is issued When: 1)        Respondent issues a Payment Schedule; and 2)        Respondent fails to pay the amount in the Payment Schedule by the due date Within 20 business days after a Payment Schedule is issued When 1)        Respondent fails to issue a Payment Schedule; 2)        Respondent fails to pay the amount in a Payment Claim by the due date; 3)        Claimant serves written notice of intention to apply for adjudication of the payment claim on Respondent within 20 business days from the due date; and 4)        Respondent has been given an opportunity to provide a Payment Schedule within 5 business days after receiving notice of intention to apply for adjudication of the payment claim Within 10 business days after the end of the 5 business days for Respondent to provide a Payment Schedule after receiving notice of intention to apply for adjudication of the payment claim                                                   Detailed procedures, requirements for adjudication and enforcing the adjudicator’s determination will be discussed in future articles.   Payment Withholding A subcontractor who has made an adjudication application for a progress payment is also entitled to request a principal contractor to retain money owed to a head contractor to cover the claimed amount.[10] This is called a ‘payment withholding request’. Upon receipt of the payment withholding request, the principal must retain the amount of money to which the payment claim relates.[11]  When a successful outcome is given in the adjudication process, a subcontractor is able to recover the withheld money from the principal through the procedures set out in the Contractors Debts Act 1997 (NSW).   How can we assist  If you are involved in construction work in New South Wales, the SOPA entitles you to claim the progress payment and have protections accordingly. However, your rights under SOPA may vary depending on your satisfactory fulfilment of requirements and on whether you took proper actions in a timely manner. Although the SOPA sets out a statutory regime for prompt payment for construction work, there are still a number of disputes arising from unpaid progress payments in a construction contract, which ends up with unsatisfactory outcomes for unpaid contractors and suppliers. If you are unsure what rights you have in your construction payment issues, H & H Lawyers will be happy to review your case to check whether it might fall within a case protected under the Security of Payment Act or other relevant laws. We can further assist in finding a way to enforce your rights.   Disclaimer: The contents of this publication are general in nature and do not constitute legal advice. The information may have been obtained from external sources and we do not guarantee the accuracy or currency of the information at the date of publication or in the future. Please obtain legal advice specific to your circumstances before taking any action on matters discussed in this publication. [1] SOPA ss4 and 8. [2] SOPA s5 [3] SOPA s5 [4] SOPA s13 [5] SOPA s14 [6] SOPA s11 [7] SOPA s27 [8] SOPA s12 [9] SOPA s17 [10] SOPA s26A [11] SOPA s26B

Dispute Resolution & Litigation

Security for costs in the context of the foreign judgment registration in Australia: KR & C Co Ltd v Soon Ok Hwang [2021] NSWSC 551

On 18 May 2021, the Supreme Court of New South Wales in KR & C Co Ltd v Soon Ok Hwang [2021] NSWSC 551 held that a security for costs application brought by a judgment debtor in its Notice of Motion to set aside a foreign judgment registered in Australia is to be dismissed with costs. This case provides a useful authority where there is limited case law dealing with security for costs applications in the context of the foreign judgment registrations in Australia. H & H Lawyers successfully opposed the security for costs application in these proceedings. Background In this case, the plaintiff, a foreign company, was a judgment creditor in a judgment held in the Republic of Korea against the defendant who was a judgment debtor. Based on that judgment, the plaintiff filed a Summons seeking an order for registration of the foreign judgment under the Foreign Judgments Act 1991 (Cth) (FJA). The foreign judgment from Korea was ordered to be registered, and the defendant applied to set it aside. A case concerning an application seeking to set  aside a registered foreign judgment will be discussed separately in a further case note.  Following the setting aside application, the defendant, by another Notice of Motion, sought security for costs against the plaintiff, which is the subject of this case note. The defendant by seeking the security for costs relied upon the prospects of success on the application to set aside the registration of the Korean judgment. The plaintiff opposed the security for costs on, amongst others, the following bases: 1. While security for costs under r 42.21 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) is limited to applications made by a defendant in the proceeding, r 53.4 is intended to preclude a judgment debtor from making an application for security; 2. There is no reason to believe that the plaintiff would not pay any costs order if ordered; and 3. The defendant’s prospects of success are minimal.   The Court dismissed the defendant’s security for costs application by upholding the plaintiff’s 2nd and 3rd arguments above. The Supreme Court’s Reasoning The first question before the Court was the interpretation of UCPR r 53.4. That rule relevantly provides that:   “For the purposes of proceedings under the Foreign Judgments Act 1991 of the Commonwealth, the Supreme Court may make an order under rule 42.21 otherwise than on the application of the judgment debtor.”   In the previous hearing, on a motion for extension of time to apply to set aside the registration of foreign judgment before Campbell J in KR & C Co Ltd v Soon Ok Hwang [2021] NSWSC 164, one of the defendant’s contentions concerning r 53.4 was that it allows the Court to make a security for costs order of its own motion. However, Campbell J, referring to Richie’s commentary, stated to the effect that either the judgment debtor or creditor may make an application for security under r 53.4. The Court in the present proceedings disagreed with Richie’s commentary, and accepted and cited obiter dicta of Adams J in Raffaele Viscardi SRL v Qualify Centre Food Services Pty Limited (No 2) [2013] NSWSC 2055 (“Viscardi”), which stated that: “Though awkwardly drafted, this (being r 53.4) appears to prevent a judgment debtor, though a defendant, from making an application under r 42.21.” Nevertheless, the Court did not determine this issue as it was not necessary for the Court to decide that in the circumstance where the judgment creditor was found to be not impecunious.  During the proceedings, it was not contested that the plaintiff is a company registered in Korea, ordinarily resident outside Australia, and has no assets in Australia. Therefore, the threshold required in r 42.2(1)(a) of UCPR was enlivened without difficulty. The plaintiff is a wholly-owned subsidiary of a statutory authority in Korea that has a similar function to that of the Australian Prudential Regulation Authority (APRA). There was no evidence establishing that the plaintiff, despite it being a foreign entity, is impecunious or will be unable to pay any adverse costs if ordered. Further, given the substantial reciprocity of treatment of judgments between Australia and Korea, the defendant can enforce the costs order in Korea, if ordered.  As to the prospect of success on the application to set aside the registration of the Korean judgment, the defendant relied on public policy grounds under s 7(2)(a)(ix) of the FJA for reasons that: 1. There was a time interval between the foreign judgment and the registration in Australia; 2. The defendant did not receive notice of the proceedings in Korea; and 3. The quantum of the registered judgment is excessive.    The Court found that the defendant’s public policy arguments were weak. The detailed arguments and analysis of the above contentions will be discussed in a further case note as that is the gist of the further proceedings, however, in summary, it was resolved that the prospect of success in the defendant’s contentions was modest at best. Implications This case is one of the limited authorities that have decided the security for costs application in the context of foreign judgment registrations in Australia. There are three key takeaways to be learned from this case. Firstly, the mere fact that a party is not an ordinary resident and does not possess assets in Australia does not necessarily mean that that party would be unable to pay the costs. There must be something more than evidence simply showing that a party is a foreign entity, particularly in circumstances where that foreign entity is a government-owned company and where an original court and Australian courts mutually recognise judgments of each other.  Secondly, when relying on the prospect of success ground in a security for costs application, a party applying for security is required to prove more than a moderate possibility of success in their arguments. In the present case, the Court found that the prospect in the defendant’s arguments was moderate but did not accept that that was sufficient. Lastly and most importantly, it is a persuasive ground to argue that, while it is obiter dicta in this case and also in the Viscardi case, UCPR r 53.4 operates to preclude a judgment debtor from making an application for security. In New South Wales, the registration of a foreign judgment is determined ex parte (i.e. without the other party’s attendance and notice), and it is always the case that a judgment debtor applies for setting aside after the registration is completed. As such, a judgment creditor is relevantly in the position of a respondent/defendant who needs to respond to a motion brought by a judgment debtor. On that premise, it is unreasonable to view that UCPR r 53.4 is interpreted in a way that a moving party seeking a court order, i.e. a judgment debtor, is also allowed to seek security for costs that may stop a judgment creditor from responding to a judgment debtor’s motion  

Dispute Resolution & Litigation

Considering buying off-the-plan? Purchasers beware.

H & H Lawyers successfully defends a vendor developer against claims brought by the purchaser of an off-the-plan property in the Supreme Court of NSW.   While the benefits of buying an off-the-plan property are often highlighted to a purchaser, the decision in Xu v Lindsay Bennelong Developments Pty Limited & Ors [2020] NSWSC 1692 confirmed the importance of having any terms that are “non-negotiable” for the purchaser to be clearly expressed in writing in the contract for sale of land.   Facts In this case, the plaintiff was a purchaser of an off-the-plan property. During the handover inspection of the completed property, the purchaser discovered that there was only one car space attached to her property despite the representation being made prior to entering the contract for sale of land that there would be two car spaces. Subsequently, the purchaser brought a claim against the former vendors of the subject property and the substituted vendor, to whom the contract for sale was novated to, after exchange of contracts. Other relevant facts include: 1.   prior to purchasing the property, the agent made representations to the purchaser that there would be two car spaces attached to the property; 2.   prior to purchasing the property, the purchaser’s solicitor inquired and the former developer confirmed in writing that the property had two car spaces; 3.   the front page of the contract of sale of land did not specify how many car spaces were attached to or formed part of the property; 4.   the draft floor plan and draft strata plan of the property which were attached to the contract of sale marked that there are two car spaces allocated to the property; 5.   there was no other mention of there being two car spaces attached to the property in the special conditions to the contract or anywhere else in the contract; and 6.   it was a special condition to the contract for sale that the purchaser acknowledges and agrees that the vender may make alterations, from time to time, and vary the building floor plan or the draft strata plan, as it sees necessary or desirable. The plaintiff claimed that the defendants breached the fundamental term and purposes, or alternatively, an implied term of the contract, by only transferring one car space with the property instead of two car spaces. The plaintiff also claimed that, in doing so, the defendants engaged in misleading and deceptive conduct or false representation under sections 18 and 30(1)(e) of the Australian Consumer Law (“ACL”) and sought specific performance for the defendants to transfer one more car park under sections 237 and 243 of the ACL. The then Chief Judge in Equity, Ward CJ dismissed the plaintiff’s arguments and held that:  1.   the contract was for the sale of a unit with a single tandem car space. However transferring two car spaces was neither a fundamental term nor an essential implied term of the contract; and  2.   the representations that the plan would include a space for two cars were clearly made. Nonetheless, such representation does not amount to misleading or deceptive conduct in circumstances where the developer had reasonable grounds to make such representation at the time and the plaintiff suffered no loss by relying on the promise.   Key takeaways While this case is not to be generally applied to all circumstances in relation to off-the-plan purchases, a purchaser of an off-the-plan property should be mindful of standard special conditions attached to contracts for sale of off-the-plan properties which are designed to allow a vendor developer to make changes (to a degree) to a draft floor plan or draft strata plan. As in this case, even if the court finds that the draft plan which formed part of the contract was varied, such variation may not constitute a breach of a fundamental or essential term of contract. Thus, a purchaser of an off-the-plan property must scrutinise the terms and conditions before entering into the contract for sale. Further, if the purchaser seeks to rely on any representations made by an agent or vendor prior to entering into the contract, such representation should be expressly and unequivocally included in writing in the contract to make sure the vendor makes good on the promise. The purchaser should also be mindful that the contract would generally provide a limited time to seek rescission. A vendor should also consider the litigation risks associated with the sale of off-the-plan properties. Even if the vendor is successful such as in this case, being involved in court proceedings is costly and time-consuming, and may impact its reputation as a developer as well as open the gate for other purchasers to bring a similar claim against the developer.     Disclaimer: The contents of this publication are general in nature and do not constitute legal advice. The information may have been obtained from external sources and we do not guarantee the accuracy or currency of the information at the date of publication or in the future. Please obtain legal advice specific to your circumstances before taking any action on matters discussed in this publication.  

Dispute Resolution & Litigation

High Court Clarifies Definition of Casual Employee

As one of the most significant decisions by the High Court in 2021, the High Court has determined the meaning of a casual employee in Workpac Pty Ltd v Rossato [2021] HCA 23.  Mr Rossato was employed as a production worker by Workpac’s labour-hire company under a series of six contracts, or assignments, to perform work for one of Workpac’s clients. While Mr Rossato was required to work regular and full-time hours according to a fixed pattern of work, Workpac treated Mr Rossato as a casual employee, such that Mr Rossato was not paid the leave or public holiday entitlements under the Fair Work Act 2009 (Cth) (the Act) and the enterprise agreement.   The Court confirmed that the question of whether a person is a casual employee is to be determined by considering the express terms of a written employment contract, and not on the basis of any subsequent conduct of either party. To this extent, the court held any such commitment to further work must be contained in an enforceable agreement to be recognised.  The High Court held that a casual employee is an employee who has no “firm advance commitment as to the duration of the employee’s employment or the days (or hours) the employee will work” and provides no reciprocal commitment to the employer. In considering the nature of the commitment, the court held that ‘the existence or otherwise of a “firm advanced commitment” must be for enforceable terms’, and should not be held to exist from expectations or understandings borne from the manner in which the parties have performed their agreement. The High Court held that a mere expectation of continuing employment on a regular and systematic basis is not sufficient for the purposes of the Act. Mr Rossato’s employment was expressly on an “assignment by assignment basis”. Mr Rossato was entitled to accept or reject any offer of an assignment, and at the completion of each assignment Workpac was under no obligation to offer further assignments. The High Court also held that it was not the role of the courts to “moderate a perceived unfairness resulting from a disparity in bargaining power between the parties”.  In relation to the employment relationship, it should be noted that the High Court held in BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 that: 1. while mutual undertakings may not always be express, where there are express terms of the contract between the parties, they must be given effect unless they are contrary to statute; 2. if the mutual undertakings are said to be implied in what has been agreed, they cannot be inconsistent with the express terms of the contract; and 3. if the mutual undertakings are to be inferred from the conduct, then they may take effect as contractual variations. This decision by the High Court in Workpac v Rossato is important for both employers and employees as it reinforces the importance of specifying the terms of the contract in writing, taking into account the key features of the High Court’s decision. It is also important that casual contract terms and employer’s policies are carefully reviewed to ensure that they do not create any unintentional implied mutual obligations or variations inferred from the conduct.  It is also worth noting that a new provision of s 66B of the Act has been introduced which requires employers to offer casual employees to become permanent employees if they have been employed for 12 months and have worked regular and systematic patterns in the last six months.   Disclaimer: The contents of this publication are general in nature and do not constitute legal advice. The information may have been obtained from external sources and we do not guarantee the accuracy or currency of the information at the date of publication or in the future. Please obtain legal advice specific to your circumstances before taking any action on matters discussed in this publication.