Contractual timeframes have real teeth
Ordinarily we do not write articles about legal decisions but a recent case which we were involved in is worthy of mention.
It is Edwards v Sovereign Homes Qld Pty Ltd [2022] QCA 4, in which we acted for the successful Respondent.
The issue in that case was whether the Applicant homeowner could dispute a finding of the Queensland Civil Administrative Tribunal, that our client, the Respondent builder, had achieved practical completion of a house, even though the homeowner had failed to dispute the builder’s notice of practical completion as required by the contract.
Relevantly the contract provided that the date of practical completion would be deemed to be the date set out in the notice of practical completion given by the builder, unless the homeowner gave a notice disputing the date of practical completion, within five working days of receipt of the notice of practical completion.
The Queensland Court of Appeal held that in circumstances where Mr Edwards failed to issue a notice disputing the date of practical completion within the five working day, the contract deemed the date of practical completion to be the date which was set out in the notice of practical completion which had been delivered by the builder.
This was so, despite the fact that the house had been severely damaged by a hailstorm prior to date for practical completion, which had not been rectified as at the deemed date of practical completion.
The key takeaway is that if your contract provides that a certain state of affairs will be deemed to exist unless you take a particular action, such as give a notice in writing objecting to an assessment within a particular timeframe, then you need to ensure that you comply with that particular provision; as the failure to do so can have very serious consequences as it had for Mr Edwards.
Queries
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Disclaimer
This information and the contents of this publication, current as at the date of publication, is general in nature to offer assistance to Cornwalls’ clients, prospective clients and stakeholders, and is for reference purposes only. It does not constitute legal or financial advice. If you are concerned about any topic covered, we recommend that you seek your own specific legal and financial advice before taking any action.