district court logo

Tailorspace Property Ltd v Identify Consulting Ltd [2021] NZDC 10506

Published 24 June 2024

Breach of contract — construction contract — asbestos removal — "construction work" — principles of statutory interpretation — Construction Contracts Act 2002, ss 3, 5, 6 & 74 — Construction Contracts Amendment Act 2015 — Interpretation Act 1999, s 5 — Van der Wal Builders v Walker, HC Auckland, CIV-2011-004-083, 26 August 2011 — MacRitchie v Trustees Executors Ltd, District Court Wellington, CIV-2009-085-359, 12 August 2009 — George Developments Limited v Canam Construction Limited [2006] 1 NZLR 177. These proceedings concerned a contract dispute that arose from the removal of asbestos from a building that was being converted into a hotel. The plaintiff property developers had engaged the defendants to arrange the removal, which was ultimately carried out by a third party with oversight from the defendants. The plaintiff alleged that after the removal work was completed with approval from the defendants, more asbestos was found inside the building. The plaintiff alleged that the defendant had breached the construction contract between the parties, causing the plaintiff some $284,441 in losses. At adjudication, the plaintiff had been awarded damages and costs; it now sought to enforce that award. To enforce the award, the Court had to determine that there had in fact been a construction contract between the parties, and that as a result the adjudicator had had jurisdiction to deal with the adjudication. To decide if there was a construction contract, the Court had to decide if the defendant had carried out construction work. The plaintiff argued that removal of asbestos came within the definition of "construction work" in the Construction Contracts Act. Further, given the importance of oversight to the removal process, the defendant had also carried out "construction work". The defendant disagreed, arguing that the relevant section of the Act (s 6) had been drafted specifically to exclude this type of work. The Court observed that s 6 was "not particularly happily drafted". However to find that asbestos removal did not qualify as construction work would be to fail to give effect to the purpose of the Act. Therefore the removal of asbestos had to be properly regarded as construction work; the defendant's oversight was integral to the removal, meaning that the defendant had engaged in construction work. The Court found that the adjudicator had been correct to find that it had jurisdiction, and so the Court had to give effect to its decision. The Court ordered judgment to be entered in favour of the plaintiff. Judgment Date: 1 June 2021

Tags