SUPREME COURT OF QUEENSLAND

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2 rectify the defendant’s breaches of the contract specified in the statement of claim and claims the costs of rectification as loss and damage – where the defendant applies to strike out paragraphs of the plaintiff’s statement of claim on the basis that the paragraphs failed to assert a causal nexus between the alleged breaches and the items of loss or damage – where the plaintiff relies on the application of the “ruling principle” for the assessment of damages for breach of contract – whether sufficient material facts are pleaded by the plaintiff to support the cause of action for damages for breach of contract COUNSEL: SOLICITORS: Bellgrove v Eldridge (1954) 90 CLR 613, considered Clark v Macourt (2013) 253 CLR 1; [2013] HCA 56, considered Mainteck Services Pty Ltd v Stein Heurtey SA (2014) 310 ALR 113, considered Tabcorp Holdings Ltd v Bowen Investments Pty Ltd (2009) 236 CLR 272; [2009] HCA 8, considered Willshee v Westcourt Ltd [2009] WASCA 87, considered G Beacham QC with B O’Brien for the plaintiffs R A Holt QC with L Clark for the defendant Herbert Smith Freehills for the applicants McCullough Robertson Lawyers for the defendant [1] The defendant applies to strike out paragraphs 19 to 23 of the plaintiffs’ statement of claim filed on 23 April 2015 or, in the alternative, for an order that the plaintiffs provide further and better particulars in respect of paragraphs 19(d) and 20 to 22. The application is opposed on behalf of the plaintiffs. There is a dispute between the parties as to what material facts must be pleaded in respect of the plaintiffs’ claim for damages for breach of contract arising from works performed by the defendant (an earthworks contractor) in constructing an earthworks dam and associated works at Goonyella Riverside Mine near Moranbah. Background to plaintiffs’ claim [2] The plaintiffs are joint venture parties which own the mine and the first plaintiff is the management company which operates the mine for them. The relevant contract was entered into between the first plaintiff and the defendant in December 2010. In December 2011 the first plaintiff terminated the contract. At the time the termination took effect in January 2012, the construction of the dam was incomplete. [3] This proceeding was commenced by the plaintiffs in July 2013 claiming damages for breach of contract and repudiation. The breaches alleged in paragraphs 14 to 18 of the statement of claim are the placement of “lots” of soil in the embankment of the dam which do not comply with the specifications in the contract, along with the late delivery or nondelivery of the test results and reports required under the contract which were required to
3 demonstrate the compliance of the lots with the specifications. The plaintiffs seek the costs of rectifying the non-compliant lots and the additional costs of completing the dam. Progress of the pleadings [4] Paragraph 19 of the statement of claim (omitting the particulars) alleges: “19. By reason of the breaches of the Contract set out above: (a) The soil placed in the Embankment in the areas described in paragraph 14 above does not comply with the requirements of the Contract; (b) The first plaintiff cannot determine whether the soil placed in the Embankment in the areas described in paragraph 15 above complies with the Contract; (c) The first plaintiff did not become aware of the matters set out in (a) and (b) above, until further soil had been placed in the Embankment on top of the areas which suffer from the deficiencies described in (a) and (b) above; (d) The work performed under the Contract does not comply with the Contract.” [5] Paragraph 20 then pleads that by reason of the defendant’s breaches of contract referred to in paragraphs 14 to 18, the first plaintiff has suffered loss and damage, the measure of which is the cost of rectifying the breaches referred to in paragraphs 14 and 15, or alternatively 14 and 16. Paragraph 21 contains an alternative pleading on the basis that it is the joint venture parties which have suffered the loss and damage and the first plaintiff is entitled to sue for and recover that loss for the benefit of the joint venture parties. [6] Paragraph 22 then sets out what the plaintiffs allege is necessary to be done in order to rectify the breaches in these terms: “In order to rectify the breaches referred to in paragraphs 14 and 15, or alternatively 14 and 16, above, it is necessary to: (a) remove the work performed by the defendant that does not comply with the Contract, and re-perform that work in accordance with the Contract (Cost of Rectification); (b) alternatively: (i) alter the batter of the upstream shoulder from 1V:3H to 1V:4H, and install a HDPE liner to the upstream shoulder and the floor of the Dam impoundment area (Alternative Cost of Rectification Option 1); (ii) alter the batter of the upstream shoulder from 1V:3H to 1V:4H, completely remove and replace the downstream
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Page 9 and 10: 9 promised. In this way, the measur
Page 11: 11 [42] The alternative claim in th

SUPREME COURT OF QUEENSLAND

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