Plaintiff v Defendant

2 On or about 23 May 2011, V601 and Probuild entered into a Contract for the design and construction of the Precinct apartments development at 601 Victoria Street, Abbotsford in the State of Victoria (the Site) for the lump sum price of $115,864,529 (the Contract).[1]

3 The Contract is generally in the form of the Australian Standard Contract (AS4902-2000) with the usual Annexures, as specifically amended for the Precinct Project. This includes the Contract Program at Annexure 5A.[2]

4 The Precinct Project is a mixed-use development of both commercial and residential premises at 601 Victoria Street, Abbotsford, Victoria.

5 The Precinct Project comprised five separate buildings, a swimming pool, a road extension, significant landscaping works, and comprised 467 apartments. The five buildings are:

(a) Building A, a three-storey building comprising ground-floor retail premises and a residential space consisting of 21 apartments;

(b) Building B, a residential building including 181 apartments and car parking;

(c) Building C, a five-storey residential and commercial building including 34 apartments;

(d) Building D, a four-storey residential building with 41 apartments with associated car parking; and

(e) Building E, an eight-storey residential building with associated car parking.

6 The Site occupies 2.5 acres in size. It is surrounded by adjoining properties to the north, Victoria Street to the south, Flockhart Street to the east, and Grosvenor Street to the west. The extension of Shamrock Street (which was part of the WUC) ran across the middle of the Site, dividing the Site into two areas.

7 Under the WUC, Probuild was responsible for tasks related to the design and specification of the WUC. This scope of work included the preparation of design documents and, if required by the Proprietor's project requirements, a preliminary design. Thereafter, Probuild was responsible for constructing the Work in accordance with this design.

(a) for a fixed-sum Contract Price, subject to certain contractual adjustments;

(b) in eight Separate Portions, each with its own contractually specified completion date; and

(c) in accordance with the Planning Permit and Preliminary Design included in the Contract.

9 The Precinct Project's eight (8) Separable Portions are as follows:

(a) SP 1 - Building A1: Retail building and associated car parking;

(b) SP 2 - Building C1: Commercial component of Building C;

(c) SP 3 - Building D: Residential building and associated car parking;

(d) SP 4 - Building E: Residential building and associated car parking;

(e) SP 5 - Building C2: Residential component of Building C and associated car parking;

(f) SP 6 - Building B: Residential building and associated car parking;

(g) SP 6A - Building A2: Residential component of Building A and associated car parking; and

(h) SP 7 - Practical Completion: Practical Completion of the Project.

10 The Precinct Project works were generally described as the Works Under Contract (WUC) in the Contract.

11 The main works for the Precinct Project, defined as the WUC, were preceded by certain works (the Early Works) required to prepare and construct the elements necessary for the WUC, to the point at which Probuild's main works under the Design and Construction Contract could be commenced in full.

12 The Early Works were to be carried out by Probuild pursuant to the Precinct Apartments - Early Works Agreement entered into on 20 April 2011 (the Early Works Contract).[3]

13 V601 commenced these proceedings seeking recovery of liquidated damages entitlements under the Contract, relying on certificates issued by the Project Manager, First Urban Pty Ltd (First Urban), which purported to certify that liquidated damages were due and payable by Probuild to V601 for each day after the agreed Dates for Practical Completion, until the actual Dates of Practical Completion, for each of the Separable Portions of the WUC.

14 In response to V601's claim for liquidated damages, Probuild filed counterclaims alleging that First Urban failed to allow Probuild's claims entitlement to extensions of time under the Contract, which Probuild asserts were sufficient to extinguish V601's liquidated damages entitlement.

15 By its counterclaim, Probuild also claims delay damages under the Contract, bonus payments, and the cost of accelerating work, due to breaches of Contract alleged to have been committed by V601. Probuild additionally makes a claim for an unpaid variation in relation to the façade of the Project.

16 First Urban was appointed by V601 as the Project Manager under the Contract. The Project Management Agreement was between V601 and First Urban. Mr John Nave (Nave), a Director and Principal of First Urban, undertook the role of Project Manager under the Contract.[4]

17 The Instrument of Agreement attached to the Contract, which was also signed on 23 May 2011, contained the following terms:

9. The Contract comprises the following documents, to which the following order of precedence applies to the interpretation of any discrepancies:

(a) Instrument of Agreement;

(b) General Conditions of Contract and Annexure Part A;

(c) Appendix 1 (Contract Sum and Provisional Sums);

(d) Appendix 2 (Principal's Project Requirements);

(e) Appendix 3 (Specifications);

(f) Appendix 4 (Preliminary Design);

(g) Appendix 5B (Site Plan);

(h) Annexure Part C (Subcontractor Deed of Novation);

(i) Appendix 6 (Sales Contract);

(j) Appendix 7 (Pro Forma Statutory Declaration);

(k) Annexure Part D (Consultant's Deed of Novation);

(l) Appendix 8 (Contractor's Management Plans);

(m) Appendix 9 (Warranty Items and Warranty Periods);

(n) Appendix 10 (Form of Subcontractor Warranty);

(o) Appendix 11 (DBC Act);

(p) Appendix 12 (Notice explaining the Effects of Cost Escalation clauses);

(q) Appendix 13 (Schedule of Rates);

(r) Annexure Part B (Approved form of Unconditional Undertaking); and

(s) Annexure Part E (Deletions, Additions and Amendments).

10. Notwithstanding cl 9 above, the parties agree that in the event of a discrepancy between the Schedule of Clarifications and the Contract Documents, the Schedule of Clarifications shall prevail over all other Contract Documents.

18 The contractual provisions of particular relevance to the claims and defences in this proceeding include the following:

The Early Works and Design and Construction Contract

19 Part B of the Precinct Apartment - Early Works Contract[5] provides:

General Description - the works that Probuild will be managing on behalf of the Principal

The management of any and all works associated with the Early Works (EW) of the project that are required to prepare and construct the necessary elements up to the point at which Probuild's main Works Under the Contract (WUC) can be commenced in full. These works may include, but are not limited to trade specific works, design consultancy works, Authority works and preliminaries activities. The WUC for any separable portion commences after the completion of the site clearance, site preparation, basement retention system, bulk excavation to within +/- 25mm from underside of the lowest basement slab on ground and the retention works structure up to and including capping beam. The EW will therefore include these activities, and in addition will include the management of any uncompleted works remaining from the Principal's prior works.

The Design and Construction Contract - Precinct Apartments

20 The Design and Construction Contract[6] definitions provide:

1. Interpretation and construction of Contract

In the Contract, except where the context otherwise requires:[7]

'Contract Document' means those documents listed in paragraph 9 of the instrument of agreement;

'Contractor's Program' means the document set out in Appendix 5A or such replacement document referred to in clause 32;

'Date for Practical Completion' means:

(a) where Item 7(a) provides a date for Practical Completion, the date;

(b) where Item 7(b) provides a period of time for Practical Completion, the last day of the period,

but if any EOT for Practical Completion is directed by the Project Manager or allowed in any dispute resolution process adapted by the parties pursuant to clause 42 or litigation, it means the date resulting therefrom;

'Date of Practical Completion' means:

(a) the date evidenced in a Certificate of Practical Completion as the date upon which Practical Completion was reached; or

(b) where another date is determined in any dispute resolution process adapted by the parties pursuant to clause 42 or litigation as the date upon which Practical Completion was reached, that other date;

'Early Works' means the early works carried out on behalf of the Principal, in respect of which the Contractor has separately been appointed as a construction manager, including demolition, excavation, piling and other associated early works;

'Practical Completion' is that stage in the carrying out and completion of WUC when:

(a) the Works are complete except for minor Defects:

(i) which have been listed by the Contractor and approved by the Project Manager as not required to be rectified at Practical Completion;

(ii) which, in the Project Manager's opinion, do not prevent the Works from being reasonably capable of being used for their intended purpose;

(iii) which the Project Manager determines the Contractor has reasonable grounds for not promptly rectifying; and

(iv) the rectification of which will not prejudice the convenient use and/or lawful occupation of the Works;

(b) those Tests which are required by the Contract to be carried out and passed before the Works reach Practical Completion, have been carried out and passed;

(c) all docmnents [sic] and other information required under the Contract which, in the Project Manager's opinion, are reasonably required for the use, operation and maintenance of the Works have been supplied in draft (which documents shall be finalised within 28 days after the Date of Practical Completion);

(d) certificates have been provided from each Key Consultant engaged in respect of the WUC confirming that the part of the Works the subject of that Key Consultant's design has been carried out in accordance with the Contract and the Endorsed Design Documents;

(e) all relevant approvals, including but not limited to those required under the Building Act, which are to enable use of the whole of the Works (including the original certificate of occupancy (or occupancy permit) issued by a licensed building surveyor and any other certificate, approval or authorisation which must be issued or given by an Authority to lawfully occupy or use the Works), have been obtained by the Contractor and given to the Project Manager;

(f) the Contractor has supplied the Project Manager the following:

(i) a certificate by a licensed surveyor identifying the Works and confirming that there are no encroachments by the Works upon adjoining lands;

(ii) a certificate from an independent consultant confinning [sic] that the fire services function under normal and simulated emergency operating conditions and in accordance with the Contract;

(iii) a copy of all fire rating certificates required under the Contract in respect of materials forming part of the Works;

(iv) a compliance certificate as required under section 221ZH of the Building Act;

(g) all plant and equipment forming part of the Works has been installed, commissioned and tested and function under normal and simulated emergency operating conditions and in accordance with the Contract;

(h) all rubbish, surplus material, Temporary Works, plant, equipment and hoarding has been removed from the Site so as to leave the Site in a clean and tidy condition, except for those items which the Project Manager agrees in writing are required during the Defects Liability Period;

(i) without limiting paragraph (a) above, the following items forming part of the Works have been completed:

(i) all appliances and fittings have been installed and are fully operational;

(ii) all work on areas of common property;

(iii) all landscaping which the Project Manager reasonably determines should be finished;

(iv) any parts of the Works which the Contractor has used in the course of construction, including lifts and light globes, have been restored or replaced, as applicable; and

(v) the whole of the Works has been professionally cleaned;

'Project Manager' means the person stated in Item 5 as the Project Manager or other person from time to time appointed in writing by the Principal to be the Project Manager and notified as such in writing to the Contractor by the Principal and, so far as concerns the functions exercisable by a Project Manager's Representative, includes a Project Manager's Representative.

'Qualifying Cause of Delay' means:

(a) any act, default or omission of the Project Manager, the Principal or their consultants, agents;

(b) a Variation under clause 36, excluding a Variation under clause 36.5;

(c) any Melbourne Metropolitan state wide or nation wide industrial relations dispute except where such industrial relations dispute is solely and directly connected to the Contractor in undertaking its usual business, or is specific to the Site;

(d) a change in Legislative Requirement described in clause 11.2(a) (except those Legislative Requirements described in clause 11.2(a)(v));

(e) a Force Majeure Event;

(f) suspension of the Works pursuant to clause 33.l(a)(i) or 33.l(c);

(g) delay caused by a headworks contractor or any other separate contractors directly and exclusively controlled by the Principal or the Project Manager on behalf of the Principal (including Other Contractors);

(h) a Latent Condition;

(i) delay caused by municipal, public or statutory authorities not caused by the Contractor;

(j) testing, treatment and/or removal of Contaminated Soil by the Principal in accordance with clause 25.3; and

(k) delay caused by compliance with clauses 24.3;

'Site' means the lands and other places to be made available and any other lands and places made available to the Contractor by the Principal for the purpose of the Contract as described in Appendix 5B;

'the Works' means the whole of the WUC to be carried out and completed in accordance with the Contract, including Variations provided for by the Contract which by the Contract is to be handed over to the Principal;

'WUC' (from Work under the Contract) means the Work which the Contractor is or may be required to carry out and complete under the Contract and includes the Contractor's Design Obligations, Variations, remedial Work, Construction Plant, Temporary Works and the Work the subject of the Schedule of Clarifications.

4. Separable Portions

(a) Separable Portions may be directed by the Project Manager, at any time, who shall clearly identify for each, the:

(i) portion of the Works;

(ii) Date for Practical Completion; and

(iii) respective amounts for Security, liquidated damages and delay damages (all calculated pro-rata according to the ratio of the Project Manager's valuation of the Separable Portion to the Contract Sum).

(b) The interpretations of:

(i) Date for Practical Completion;

(ii) Date of Practical Completion; and

(iii) Practical Completion,

and clauses 2, 14, 24, 27, 32, 34, 35, 36 and 46 shall apply to each Separable Portion and references within those clauses to the Works and to WUC shall mean so much of the Works and WUC as is comprised in the relevant Separable Portion.

22 Clause 9A (Construction Management of Early Works) of the Contract provides:

9A Construction Management of Early Works

(a) The parties, acknowledge that the Contractor has separately been appointed by the Principal as construction manager in respect of the Early Works.

(b) Despite any other provision of this Contract the Contractor shall not commence the WUC until:

(i) the Early Works have achieved completion in accordance with the construction management agreement and respective trade contracts ('Early Works Completion');

(ii) the Early Works in respect of that part of the Site (or affecting access to that part of the Site) have achieved Early Works Completion;

(iii) any other commencement date (or staggered dates as the case may be) agreed in writing by the parties; or

(iv) a Direction to carry out a Variation is issued by the Principal in accordance with Clause 9A(d).

(c) Notwithstanding clause 34, the Dates for Practical Completion under the Contract shall be extended for each day after the 7th October 2011 that Early Works Completion has not been achieved.

(d) During the performance of the Early Works, the Project Manager may identify portions of the Site where it believes the WUC can commence and give the Contractor written notice of a proposed Variation in accordance with Clause 36.2. Subject to the Contractor's response in accordance with Clause 36.2 the Principal may then issue a Direction to carry out a Variation to commence the WUC in accordance with Clause 36.1(b)(vi).

20 Project Manager

20.1 Agent functions

(a) The Principal shall ensure that at all times there is a Project Manager.

(b) The Principal has appointed the Project Manager as its agent under the Contract in relation to the following functions and any other function which the Principal notifies the Contractor of in writing from time to time but in each case, in advance of the exercise of such function by the Project Manager:

(i) assessing the value of work;

(ii) certification of moneys due and owing as between the Contractor and Principal by way of the issue of a Payment Schedule under clause 37.2 or a Final Certificate under clause 37.4;

(iii) directing Variations under clause 36.1; and

(iv) any determination required as to the quality of any work.

(c) The Principal shall ensure that in the exercise of the Project Manager's functions as the Principal's agent under the Contract, the Project Manager:

(i) acts honestly; and

(ii) acts within the time prescribed under the Contract or where no time is prescribed, within a reasonable time,

but is not, as the Principal's agent, required to act independently or impartially.

20.2 Independent functions

(a) In addition to the Project Manager's functions as the Principal's agent as set out in clause 20.1, the Project Manager shall also act as assessor and certifier in respect of:

(i) whether the Contractor is entitled to an EOT;

(ii) whether the Contractor has achieved Practical Completion;

(iii) whether the Contractor is entitled to delay damages pursuant to clause 34.9; and

(iv) in the assessment of the price of a Variation in accordance with clause 36.4.

(b) In relation to the four functions described in clause 20.2(a):

(i) the Project Manager shall act independently of the parties and neither party shall be entitled to give Directions to the Project Manager;

(ii) the Project Manager is entitled to consult with either one of or both parties but is not obliged to consult with both parties; and

(iii) the Project Manager shall act reasonably in exercising the identified functions and shall have regard to the express requirements of the Contract and not the commercial interests of either party.

20.3 Project Manager's directions

(a) The Project Manager shall be entitled to give Directions to the Contractor from time to time with reference to the WUC and the Contract generally, and the Contractor shall comply with all such Directions.

(b) Except where the Contract otherwise provides, the Project Manager may give a Direction orally but shall as soon as practicable confirm it in writing. If the Contractor in writing requests the Project Manager to confirm an oral Direction, the Contractor shall not be bound to comply with the Direction until the Project Manager does so. The Contractor acknowledges and agrees that if it acts or relies upon any documentation without:

(i) promptly requesting the Project Manager to confirm the documentation as a Direction in writing; or

(ii) receiving the Project Manager's Direction in writing confirming the documentation,

it does so at its own risk and cost.

(c) If a Direction under clause 20.3(a), conflicts with a Legislative Requirement the Contractor will inform the Project Manager, and to the extent of the conflict, the Contractor is not required to comply with the Direction.

21 Project Manager's Representative

The Project Manager may from time to time appoint individuals to exercise delegated Project Manager's functions, provided that:

(a) no aspect of any function shall at any one time be the subject of delegation to more than one Project Manager's Representative;

(b) delegation shall not prevent the Project Manager exercising any function;

(c) the Project Manager forthwith gives the Contractor written notice of respectively:

(i) the appointment, including the Project Manager's Representative's name and delegated functions; and

(ii) the termination of each appointment.

(d) if the Contractor makes a reasonable objection to the appointment of a Project Manager's Representative, the Project Manager shall terminate the appointment subject to first receiving the Principal's consent to any such termination which shall not be reasonably withheld.

25.3 Contaminated Soil Risk

(a) Should the Contractor locate what it believes to be Contaminated Soil within the Site, it shall notify the Project Manager immediately. The Project Manager will arrange for testing of the soil to be performed to determine whether the soil is Contaminated Soil. The Project Manger shall arrange such testing with as little disruption to the Contractor's program as possible and the costs of such testing shall be to the Principal's account.

(b) The Contractor agrees to provide the Principal with whatever assistance is necessary to effect the testing of the soil. If compliance with the Contractor's obligations under this clause 25.3(b) causes the Contractor to incur additional direct costs, such costs shall be assessed by the Project Manager and added to the Contract Sum. Should the relevant soil be confirmed to be Contaminated Soil, the Principal will be responsible for the classification, treatment, burial and/or removal of the Contaminated Soil. The Principal shall determine the appropriate method of dealing with the Contaminated Soil in its sole discretion, provided that such method complies with all relevant Legislative Requirements.

(c) The Contractor shall take all reasonable measures to resequence WUC whilst any potential Contaminated Soil is being tested and while any Contaminated Soil is being treated and/or removed by the Principal and shall not have any claim arising solely out of the need to resequence WUC. However, this clause 25.3(c) shall not limit the Contractor's claim under clause 25.2 in respect of any delay, disruption, additional Work, cost or expense which cannot be avoided through such resequencing.

(d) If the Contractor is no longer required to remove parts of the soil from the Site because it is found to be Contaminated Soil in accordance with this clause 25.3, there will be a deemed Variation, priced by the Project Manager using the rates for removal of clean soil contained in the Schedule of Rates.

32.3 Initial program approval and program updates

(a) The initial Contractor's Program is set out in Appendix 5A.

(b) The Project Manager may from time to time direct the Contractor to give to the Project Manager an updated Contractor's Program for approval within the time and in the form directed by the Project Manager. Such an updated Contractor's Program shall have regard to the progress of execution of WUC (including anticipated start and finish dates of activities and percentage completion of current activities) and take into account any Variations and any EOT actually granted.

( c) Any updated Contractor's Program submitted for approval by the Project Manager shall also be accompanied by a separate written list of the Contractor's Program amendments introduced by the updated Contractor's Program for comparison purposes, and shall, include:

(i) activities introduced, activities deleted and activities rescheduled;

(ii) revised activity durations;

(iii) revisions to interconnecting logic between activities;

(iv) the reasons for the amendments; and

(v) a precise description of any alleged delay event including details as to when and how the alleged event is said to have occurred,

and thereafter may be approved by the Project Manager and become an Approved Contractor's Program.

(d) The Project Manager may, in the event that the progress of the WUC falls behind that provided for in the Approved Contractor's Program, direct the Contractor to provide an updated Contractor's Program to show how the WUC will be carried out to recover lost time and achieve Practical Completion by the Date for Practical Completion.

(e) Any review, comment, approval or Direction by the Project Manager in relation to an updated Contractor's Program or an accompanying list of amendments to the Contractor's Program submitted by the Contractor shall not constitute any approval by the Project Manager of the WUC, the Contractor's performance and execution of the WUC nor the occurrence of any Qualifying Cause of Delay.

(f) The initial Contractor's Program and any Approved Contractor's Program are not a Contract Document and do not form part of the Contract, but will be used by the Project Manager as a basis for administering the Contract (to the extent possible) and for assessing any EOT claims.

(g) The Contractor shall not, without reasonable cause, depart from the Approved Contractor's Program.

(h) The provision of a Contractor's Program, any updated Contractor's Program and any review, comment, approval or Direction by the Project Manager under this clause 32.3 in relation to the same shall not relieve the Contractor from its obligation to complete the WUC by the date for Practical Completion and in accordance with this Contract. Without limiting the Contractor's rights elsewhere in the Contract, the Contractor acknowledges and agrees that its submission of the initial Contractor's Program and any amendments to the Approved Contractor's Program in accordance with this clause 32, whether in response to a Direction or not, shall not, in itself, entitle the Contractor to:

(i) an EOT; or

(ii) any increase in the Contract Sum.

32.5 Acceleration

If the Project Manager gives a Direction to the Contractor under clause 32.4:

(a) the Contractor shall accelerate WUC to overcome or minimise the extent and effect of some or all of the delay as directed, including, if required, in order to achieve Practical Completion by the Date for Practical Completion;

(b) if the Contractor would, but for the Direction, have been entitled to an EOT, the Contractor shall be entitled to claim its reasonable and necessary additional direct costs and expenses directly arising directly as a result of accelerating WUC, valued by the Project Manager in accordance with clause 36.4; and

(c) the Contractor is not entitled to any other compensation or to make any claim for loss in respect of or arising out of the cause of the delay and the Direction to accelerate except as provided in clause 32.5(b).

34 Time and progress

34.1 Progress

The Contractor shall ensure that WUC reaches Practical Completion by the Date for Practical Completion.

34.2 Notice of delay

A party becoming aware of anything which will probably cause delay to WUC shall promptly give the Project Manager and the other party written notice of that cause and the estimated delay.

34.3 Claim

(a) Subject to clause 34.4, the Contractor shall be entitled to such EOT as the Project Manager assesses, if the Contractor is or will be delayed in reaching Practical Completion by a Qualifying Cause of Delay.

(b) As soon as the Contractor becomes aware or suspects that the progress of WUC will be delayed (and in any event within 5 Business Days after the occurrence of the event causing the delay), it shall notify the Project Manager in writing giving details of the relevant event and the anticipated extent of the delay.

(c) The Contractor shall take all reasonable measures to preclude the occurrence of the event causing the delay, and to minimise the resulting delay to WUC.

(d) If the cause of the delay is a Qualifying Cause of Delay and the Contractor wishes to claim an EOT then as soon as the Contractor can ascertain or estimate with reasonable accuracy, the extent of the delay, and in any case not later than 10 Business Days after the occurrence of the Qualifying Cause of Delay, the Contractor shall make a written claim to the Project Manager for an EOT, giving details of:

(i) the Qualifying Cause of Delay;

(ii) the nature and extent of the delay, or likely delay to WUC; and

(iii) the EOT claimed.

(e) The Contractor shall promptly provide any further information requested by the Project Manager in relation to a claim for an EOT.

34.4 Assessment

(a) When both non-qualifying and Qualifying Causes of Delay overlap, the Project Manager shall apportion the resulting delay to WUC according to the respective causes' contribution.

(b) The Contractor is not entitled to an EOT unless:

(i) it has made an EOT claim in accordance with the requirements of clause 34.3 (and in this regard time is of the essence);

(ii) the delay has affected an activity which is, in the reasonable opinion of the Project Manager, on the critical path of the Approved Contractor's Program as it existed at the time of the occurrence of the Qualifying Cause of Delay; and

(iii) the Contractor has taken all reasonable measures to preclude the occurrence of the Qualifying Cause of Delay and to minimise the resulting delay including resequencing or reprogramming the performance of WUC where it is reasonably practicable to do so.

34.5 Extension of time

(a) Within 10 Business Days after receiving the Contractor's claim for an EOT, or if the Project Manager has requested further information from the Contractor in relation to an EOT claim, then after receipt of that further information, the Project Manager shall assess the EOT claim and notify the Contractor and the Principal in writing of the EOT (if any) granted so assessed.

(b) Notwithstanding that the Contractor is not entitled to or has not claimed an EOT, the Project Manager may, in the Project Manager's sole and unfettered discretion, at any time and from time to time before issuing the Final Certificate direct an EOT. The Project Manager is not required to exercise its discretion under this clause 34.5(b) for the benefit of the Contractor.

(c) A delay or failure of the Project Manager or the Principal to grant an EOT within the period specified in clause 34.5(a), or at all, will not cause the Date for Practical Completion to be set at large.

34.6 Practical Completion

(a) The Contractor shall give the Project Manager at least 10 Business Days written notice of the date upon which the Contractor anticipates that Practical Completion will be reached.

(b) When the Contractor is of the opinion that Practical Completion has been reached, the Contractor shall in writing request the Project Manager to issue a Certificate of Practical Completion. Within 10 Business Days after receiving the request, the Project Manager shall give the Contractor and the Principal either a Certificate of Practical Completion evidencing the Date of Practical Completion or written reasons for not doing so.

(c) If the Project Manager is of the opinion that Practical Completion has been reached, the Project Manager may issue a Certificate of Practical Completion even though no request has been made.

34.7 Liquidated damages

(a) If WUC does not reach Practical Completion by the Date for Practical Completion, the Project Manager shall progressively certify, as due and payable to the Principal, liquidated damages in Item 29 for every day after the Date for Practical Completion to and including the earliest of the Date of Practical Completion or termination of the Contract or the Principal taking WUC out of the hands of the Contractor.

(b) If an EOT is directed after the Contractor has paid or the Principal has set off liquidated damages, the Principal shall forthwith repay to the Contractor such of those liquidated damages as represent the days the subject of the EOT.

(c) The payment or set off of liquidated damages under this clause 34.7 shall not relieve the Contractor from its obligations to reach Practical Completion or from any of its other obligations and liabilities under the Contract.

(d) The Contractor acknowledges and agrees that:

(i) the amount of liquidated damages specified in Item 29 is a genuine pre-estimate of the loss and damage that the Principal may suffer if Practical Completion is not reached by the Date for Practical Completion; and

(ii) it shall not raise any argument that the amount of liquidated damages in Item 29 is a penalty or otherwise unenforceable either by way of a claim or defence in relation to the Contractor's obligation to pay, or the Principal's right to set off, liquidated damages.

(e) The Principal's entitlement to be paid liquidated damages under this clause shall be the Principal's sole remedy arising out of or in connection with WUC not reaching Practical Completion by the Date for Practical Completion, whether under this Contract or otherwise.

34.8 Bonus for early practical completion

If the Date of Practical Completion is earlier than the Date for Practical Completion the Project Manager shall certify as due and payable to the Contractor the bonus payment in Item 30.

34.9 Delay damages

(a) For every Working Day the subject of an EOT for a cause described in paragraph (a), (b), (f), (g), (h), (i) or (j) of the definition of Qualifying Cause of Delay and for which the Contractor gives the Project Manager a claim for delay damages pursuant to clause 41.1, damages certified by the Project Manager under clause 41.3 shall be due and payable to the Contractor in the amount which the Project Manager certifies is the Contractor's and any of its subcontractor's, employees' or agents' reasonable and necessarily incurred direct on-site time-related costs including on-site preliminaries costs (but excluding all other overhead costs, any allowance for profit or loss of profit and all consequential losses), up to the maximum amount per Working Day stated in Item 31A which damages are capped in aggregate at the maximum amount recoverable by the Contractor for delay damages stated in Item 31B.

(b) The Contractor shall, at the request of the Project Manager, make access available to its primary records and books at any pre-arranged time for the audit and checking by the Project Manager of the Contractor's costs in support of any claim by the Contractor for delay damages under this clause 34.9.

(c) The Contractor acknowledges and agrees that any entitlement of the Contractor under the Contract to delay damages in accordance with this clause 34.9 is the sole entitlement of the Contractor for any delay or disruption to the WUC and the Contractor shall have no entitlement to any other damages, costs or other compensation whatsoever from the Principal whether under the Contract, in tort (including negligence), equity, under statute or otherwise.

36.1 Directing Variations

...

(c) If the Contractor receives a Direction from the Project Manager which, although not stated to be a Direction to carry out a Variation, the Contractor considers it to be a Direction to carry out a Variation, the Contractor shall:

(i) immediately notify the Project Manager that it considers the Direction to be a Variation;

(ii) as soon as reasonably practicable but in any case not later than 10 Business Days after receipt of the Direction, provide the Project Manager with a detailed quotation for the proposed Variation supported by measurements or other evidence of cost; and

(iii) not commence or proceed with any works on Site in connection with the Direction until a further written Direction to do so is received from the Project Manager.

30 Clause 36.2 of the Contract states that the Project Manager may issue a written notice of a proposed Variation, in relation to which Probuild is required within the time specified (or otherwise within 10 Business Days) to provide the Project Manager with an estimate of the:

(i) effect on the Approved Contractor's Program (including the Date for Practical Completion); and

(ii) cost (including all warranties and time-related costs, if any) of the proposed Variation.

31 Clause 36.4 sets out the process for pricing a Variation and specifically states that:

(i) the Contractor shall not carry out a Variation unless and until a price for the Variation has been agreed between the Project Manager and the Contractor, or determined by valuation ...; and

(ii) if the Contractor carries out a Variation prior to the price being agreed or determined, the Contractor shall not be entitled to any additional payment, or any EOT, for carrying out that Variation.[8]

37.5 Interest

Interest in Item 35 shall be due and payable after the date of default in payment.

41 Notification of claims

41.1 Communication of claims

(a) The Prescribed Notice is a written notice of the general basis and quantum of the claim which includes detailed particulars of all of the following:

(i) the breach, act, omission, Direction, approval or circumstances on which the claim is or will be based;

(ii) the provision of the Contract or other basis for the claim or proposed claim; and

(iii) the quantum or likely quantum of the claim.

(b) Except where another time is stipulated elsewhere in another clause in the Contract, the Contractor shall give to the Principal and to the Project Manager the Prescribed Notice or a notice of Dispute under subclause 42.1 within 20 Business Days of the event occurring on which a claim by the Contractor is based.

41.2 Liability for failure to communicate

The Contractor shall not have any right to submit any claim, initiate any action or proceedings against the Principal, and shall release and discharge the Principal in respect of any matter, fact or thing whatsoever arising out of or in connection with or under the Contract or the WUC unless the Contractor has complied strictly with the time limits and requirements stipulated in clause 41.1 above.

41.3 Project Manager's decision

(a) If within 20 Business Days of giving the Prescribed Notice the party giving it does not notify the other party and the Project Manager of particulars of the claim, the Prescribed Notice shall be deemed to be the claim.

(b) Within 40 Business Days of receipt of the Prescribed Notice the Project Manager shall assess the claim and notify the parties in writing of the decision. Unless a party within a further 20 Business Days of such notification gives a notice of dispute under clause 42.1 which includes such decision, the Project Manager shall certify the amount of that assessment to be moneys then due and payable.

42 Dispute resolution

42.1 Notice of dispute

(a) If a difference or dispute (together called a 'Dispute') between the parties arises in connection with the subject matter of the Contract, including a Dispute concerning:

(i) a Project Manager's Direction; or

(ii) a claim,

then either party shall, by hand or by registered post, give the other and the Project Manager a written notice of dispute adequately identifying and providing details of the Dispute.

(b) Notwithstanding the existence of a Dispute, the parties shall, subject to clauses 39 and 40 and clause 42.4, continue to perform the Contract.

42.2 Conference

(a) Within 10 Business Days after receiving a notice of Dispute, the parties shall confer at least once to resolve the Dispute or to agree on methods of doing so. At every such conference each party shall be represented by a person having authority to agree to such resolution or methods. All aspects of every such conference except the fact of occurrence shall be privileged.

(b) If the Dispute has not been resolved within 20 Business Days of service of the notice of Dispute, then either party may institute court proceedings to resolve the Dispute.

1. Period without cranes and hoists $31,985 per day

2. Period with cranes but without hoists $41,909 per day

Maximum amount (in the aggregate) of delay damages recoverable by the Contractor is 17 weeks at the amount stated in Item 31A.

36 The approximate value of each of the eight Separable Portions and its percentage of the total Contract price is as follows:[9]

37 Pursuant to cl 34 of the Contract, V601 revised the Date for Practical Completion for each of the Separable Portions as follows (the original Dates for Practical Completion are below in parentheses):[10]

38 First Urban certified the Date of Practical Completion for the following buildings on the dates shown below:[11]

39 Probuild's primary case is that it was delayed in achieving Practical Completion in respect of Separable Portions 1, 3, 4, 5, 6, 6A, and 7, and is entitled to substantial extension of time and associated delay costs.

40 V601's primary case is that, on 13 September 2013, because of Probuild's delay in reaching Practical Completion in respect of Separable Portions 3 and 5, First Urban contractually and appropriately issued Liquidated Damages Certificate Number 1 pursuant to cl 34.7 of the Contract, which certified as follows:[12]

Amount Certified in Liquidated Damages (Certificate 1)

41 V601 asserts that Probuild was late in achieving Practical Completion in relation to Separable Portions 4, 6, 6A, and 7, and, as a result of delay in reaching Practical Completion of Separable Portions 3 and 5, on 11 October 2013, First Urban purported to issue Liquidated Damages Certificate Number 2 pursuant to cl 34.7 of the Contract which certified in summary that:[13]

Certified Liquidated Damages to 30 September 2013

Amount Certified in Liquidated Damages (Certificate 2)

42 Further, V601 asserts that Probuild was delayed achieving Practical Completion in relation to Separable Portions 3, 4, 5, 6, 6A and 7, and on 6 November 2013, First Urban purported to issue Liquidated Damages Certificate Number 3 pursuant to cl 34.7 of the Contract which certified in summary that:[14]

Certified Liquidated Damages to 31 October 2013

Amount Certified in Liquidated Damages (Certificate 3)

43 V601 also asserts that Probuild was delayed achieving Practical Completion in relation to Separable Portions 3, 4, 5, 6, 6A and 7, and on 13 November 2013, First Urban purported to issue Liquidated Damages Certificate Number 4 pursuant to cl 34.7 of the Contract which certified in summary that:[15]

Certified Liquidated Damages to 30 November 2013

Amount Certified in Liquidated Damages (Certificate 4)

44 Finally, V601 asserts that Probuild was delayed in achieving Practical Completion of Separable Portions 3, 4, 5, 6A and 7, and on 18 December 2013, First Urban purported to issue Liquidated Damages Certificate Number 5 pursuant to cl 34.7 of the Contract which certified in summary that:[16]

45 Liquidated Damages Certificate Number 5 in the sum of $4,712,519 is the last and final Liquidated Damages Certificate issued by the Project Manager in respect of Liquidated Damages.

46 Accordingly, V601 claims the following certified Liquidated Damages and associated interest and declarations:[17]

1. The sum of $4,712,519.

2. Interest under the Contract:

(a) from 13 September 2013 in respect of interim Liquidated Damages Certificate No 1;

(b) from 11 October 2013 in respect of interim Liquidated Damages Certificate No 2;

(c) from 6 November 2013 in respect of interim Liquidated Damages Certificate No 3;

(d) from 4 December 2013 in respect of interim Liquidated Damages Certificate No 4;

(e) from 18 December 2013 in respect of the final Liquidated Damages Certificate No 5;

totalling $885,451.58 as at 5 June 2015.

2A. Alternatively, declarations that:

(a) the Dates for Practical Completion are as follows:

(i) Separable Portion 3 - 17 July 2013;

(ii) Separable Portion 4 - 16 September 2013;

(iii) Separable Portion 5 - 21 August 2013;

(iv) Separable Portion 6 - 20 September 2013;

(v) Separable Portion 6A - 20 September 2013;

(vi) Separable Portion 7 - 20 September 2013;

(b) the Dates of Practical Completion are as follows:

(i) Separable Portion 3 - 17 December 2013;

(ii) Separable Portion 4 - 17 December 2013;

(iii) Separable Portion 5 - 21 November 2013;

(iv) Separable Portion 6 - 27 November 2013;

(v) Separable Portion 6A - 12 November 2013;

(vi) Separable Portion 7 - 17 December 2013; and

(c) liquidated damages are payable by Probuild in accordance with the above findings.

2B. Alternatively, declarations that:

(a) the Dates for Practical Completion and the Dates of Practical Completion are such other dates as the Court determines; and

(b) liquidated damages are payable by Probuild in accordance with such dates as the Court determines.

3. Costs.

4. Any other order the Court thinks appropriate.

47 It is to be noted that V601 does not, in the alternative to the Liquidated Damages claim referred to above, claim common law damages for delay against Probuild.

48 I also note that Probuild asserts that the following issues are apparently abandoned by V601:[18]

1. That the Project Manager participated in formulating, and implementing, V601's strategy to address Probuild's EOT2A and EOT3 claims, which involved the Project Manager issuing a draft determination regarding those claims on which V601 would rely when seeking to negotiate a commercial compromise with Probuild.[19]

2. The 'SP1 Side Agreement'.[20]

3. That Probuild failed to provide the necessary Notices of Dispute for its claims.[21]

4. That the factors giving rise to Probuild's EOT6 and EOT7 claims do not constitute Qualifying Causes of Delay.[22]

5. That Probuild does not own the float in any programming analysis.[23]

6. That Probuild's claims are global.[24]

7. That the multitude of allegedly concurrent delays identified in V601's lay and expert evidence (except for wet weather),[25] including:

(a) installing the piling bench;[26]

(b) tower crane;[27]

(c) work to slab B7;[28]

(d) resourcing of Probuild's excavations subcontractor, HWM Contractors;[29]

(e) addressing the risks arising from the Soft Spots;[30]

(f) replacing Caelli with I&D as the in situ structure subcontractor;[31]

(g) Probuild's request for sign-offs of the vapour barrier's design.[32]

8. That Probuild failed to take the steps a reasonable design and construct contractor would have taken to minimise the effect of the Soft Spots.

9. That Lyall's analysis regarding EOT2A did not include the 9 working days' extension awarded for EOT1.[33]

10. That Probuild failed to preclude the delay the subject of its EOT6 claim.[34]

11. That Probuild had sufficient information to place an order for the Project's glazing 'prior to and at the date of the contract'.[35]

12. That Probuild should not be awarded the declaratory relief it seeks because the delay periods identified in its programming expert's reports were not those originally submitted to the Project Manager for his consideration.

13. That the evidence of V601's programming expert, Abbott, is inadmissible, and that Abbott's evidence lacked objectivity, delved into contractual interpretation, was premised on a theoretical analysis, contained methodological errors, and contained purported determinations on matters of fact and law.[36]

14. The rates Probuild's quantum expert, Cox, applied in his analysis (such as a supervision on-cost of 30%), except to the extent they concern the crane, crane crews and Alimaks.[37]

15. In relation to the Façade Variation, that Probuild failed to discharge the responsibilities of a 'design and construct contractor'.

49 In support of the relief sought, V601 relied on the following material:

• 29 August 2016 (Maitland First Witness Statement); and
• 3 February 2019 (Maitland Second Witness Statement); and

(ii) John Nave, the Principal of the Project Manager, dated 3 February 2019 (Nave Witness Statement).[39]

(i) Stephen Abbott (Programming Expert) dated:[40]

• 12 September 2018 (Abbott First Report); and
• 17 October 2018 (Abbott Second Report);

(ii) Neil Birchall (Quantum Expert) dated:[41]

• 21 September 2018 (Birchall First Report);
• 5 October 2018 (Birchall Second Report);
• 17 October 2018 - Addendum to Birchall Second Report (Birchall Third Report);

(i) Programming Experts' Joint Report 1: Stephen Abbott and Peter Picking dated 5 February 2019;[42]

(ii) Programming Experts' Joint Report 2: Stephen Abbott and James Lyall dated 8 February 2019;[43]

(iii) Programming Experts' Joint Report 3: Stephen Abbott and James Lyall dated 15 February 2019 (Programming Experts' Joint Report 3);[44]

(d) Joint Expert Reports (Quantum)[45] of:

(i) Quantum Experts' Joint Report 1: Mike Cox and Neil Birchall dated 5 February 2019;

(ii) Quantum Experts' Joint Report 2: Mike Cox and Neil Birchall dated 13 February 2019;

(i) V601 Amended Opening Submissions dated 6 February 2019 (and Aide Memoire);

(ii) V601 Closing Submissions dated 12 June 2019;

(iii) V601 Further Closing Submissions dated 17 June 2019;

(iv) V601 Submissions dated 7 August 2019 (on its application to further amend its Amended Reply and Defence to Counterclaim); and

(v) V601 Submissions dated 10 October 2019 (re White Constructions Pty Ltd v PBS Holdings Pty Ltd [2019] NSWSC 1166).

50 During the interlocutory stages of the proceeding, V601 also filed a witness statement of Mr Colin Mackenzie (Mackenzie), V601's Development Director, dated 3 February 2019 (Mackenzie Witness Statement). However, on the day of the hearing when Mackenzie was scheduled to give evidence and be available for cross-examination, V601 elected not to call him.[46]

51 I note that Mackenzie was the Development Director on the Precinct Project for V601 and contemporaneous documents establish that he also supported the Project Manager, Nave. Further, it is clear from the Project correspondence addressed at trial by other witnesses, including Nave, the Project Manager, and Mr Matthew Bready, who was Probuild's Construction Manager, that Mackenzie was deeply involved on behalf of V601 in many of the on-site issues, problems, and claims which are the subject of this proceeding.

52 Further, I note that as a result of what appeared to be a last minute decision by V601 not to call and rely upon Mackenzie's evidence, a very considerable amount of the detailed evidence of Bready referred to below in relation to on-site activities, facts, delays, discussions, and communications in issue in these proceedings, are not addressed and not traversed by V601, save to the extent that Mr James Maitland (Maitland), the General Manager at Salvo Property Group (SPG), and Mr John Nave (Nave), the Project Manager, purport to deal with such matters in their evidence.

53 Furthermore, I also observe that it is clear from the project communications, including emails between the parties in relation to site-related matters, including many matters in issue in this proceeding, that Mackenzie was a potential witness likely to be able to give evidence on most of the main issues in dispute between the parties, and other than Nave (the Project Manager) appears to be V601's employee best placed to speak directly from his own knowledge about the matters in dispute in these proceedings, and in particular Probuild's delay and other claims.

54 In the circumstances I have outlined above, given that in my view V601 provided no satisfactory explanation for failing to call MacKenzie to give evidence, I infer that MacKenzie's evidence on matters in dispute would have been unfavourable to V601.

55 I also observe that in contrast to Mackenzie who was not called by V601, Maitland's area of responsibility with SPG was in relation to the overall strategy, direction, operations, and financial management of SPG and its subsidiaries. Maitland is a Chartered Accountant by profession. Further, in his role as General Manager, Maitland was responsible for the overall business carried out by V601, particularly sales, financing, and overall strategic direction. Maitland was not responsible for the management on Site, in particular workface issues.

56 At trial, V601 adduced evidence from James Maitland, John Nave, Stephen Abbott, and Neil Birchall.

57 In support of the relief sought, Probuild relied on the following material:

(a) Witness Statements of Matthew Bready dated 26 February 2019:[47]

Amended Witness Statement (Bready First Witness Statement);

Amended Reply Witness Statement (Bready Second Witness Statement);

Amended Supplementary Reply Witness Statement (Bready Third Witness Statement);

(b) Witness Statement of Giuseppe (Joe) Cirianni dated 23 February 2018 (Cirianni Witness Statement);[48]

(c) Witness Statements of Rebeca Lunardello dated:[49]

23 February 2018 (Lunardello First Witness Statement); and

16 October 2018 (Lunardello Second Witness Statement);

(d) Expert Reports in support of Probuild's case of:

(i) James Lyall (Programming Expert) dated:[50]

• 12 April 2018 (Lyall First Report);
• 4 May 2018 (Lyall Second Report); and
• 20 December 2018 (Lyall Third Report);

(ii) Peter Picking (Programming Expert) dated:[51]

• 16 October 2018 (Picking First Report); and
• 20 December 2018 (Picking Second Report);

(iii) Mike Cox (Quantum Expert) dated:[52]

• 8 June 2018 (Cox First Report);
• 26 October 2018 (Cox Second Report); and
• 20 December 2018 (Cox Third Report);

(i) Programming Experts' Joint Report 1: Stephen Abbott and Peter Picking dated 5 February 2019;[53]

(ii) Programming Experts' Joint Report 2: Stephen Abbott and James Lyall dated 8 February 2019;[54]

(iii) Programming Experts' Joint Report 3: Stephen Abbott and James Lyall dated 15 February 2019;

(f) Joint Expert Reports (Quantum)[55] of:

(i) Quantum Experts' Joint Report 1: Mike Cox and Neil Birchall dated 5 February 2019;

(ii) Quantum Experts' Joint Report 2: Mike Cox and Neil Birchall dated 13 February 2019;

(i) Probuild Opening Submissions dated 7 February 2019 (and Aide Memoirs);

(ii) Probuild Closing Submissions dated 11 June 2019;

(iii) Probuild Reply Closing Submissions dated 12 June 2019;

(iv) Probuild Further Reply Closing Submissions dated 18 June 2019;

(v) Probuild Submissions dated 9 August 2019 (re V601's application to further amend its Amended Reply and Defence to Counterclaim); and

(vi) Probuild Submissions dated 18 October 2019 (re White Constructions Pty Ltd v PBS Holdings Pty Ltd [2019] NSWSC 1166).

58 At trial, Probuild adduced evidence from Matthew Bready, James Lyall, Peter Picking, and Mike Cox.

59 Mr James Maitland (Maitland) was the General Manager of the Salvo Property Group (SPG). V601 is a member of SPG. Maitland is a Chartered Accountant who joined SPG in late 2010.

60 As General Manager at SPG, Maitland was responsible for the overall strategy, direction, operations, and financial management of the group, including all subsidiary businesses. He was also responsible for the overall business carried out by V601, particularly sales, financing, and overall strategic direction.

Maitland First Witness Statement (29 August 2016)

61 In his first witness statement dated 29 August 2016, Maitland stated that in or about 23 May 2011, V601 and Probuild (as the Contractor) entered into the Design and Construction Contract for the 456 unit 'Precinct' apartment development with ancillary retail, office, and storage spaces for the lump sum of $115,864,529.

62 Maitland's evidence addresses aspects of ProBuild's delay claim in relation to the Early Works Contract [EOT1].

63 In his evidence, Maitland dealt with the Project Manager's issuance of Notices of Practical Completion in respect of the Separable Portions and the WUC, and the Project Manager's purported certifications fixing sums of liquidated damages for late completion of the Separable Portions of the Project.

64 Maitland's evidence established that Probuild did not pay the liquidated damages which the Project Manager had purported to certify as due and payable by Probuild to V601.

65 Maitland's evidence also highlighted that cl 37.5 of the Contract provides for interest to be due and payable on overdue amounts at a rate of 12% per annum.

66 Maitland's evidence was that the interest payable by Probuild from the date of each of the Liquidated Damages Certificates, up to the day that these proceedings were commenced, was (at the date when he addressed the calculation of interest) $1,268,401.82. V601 updated this figure to June 2019, and revised the total certified sum claim to $4,712,519.

Maitland Second Witness Statement (3 February 2019)

67 By his second witness statement dated 3 February 2019, Maitland referred to FDG Developments Pty Ltd (FDG), a company within the Salvo group of companies, which entered into a contract of sale to purchase the land on 18 July 2008 and, on 23 April 2010, was granted a planning permit in respect of 601 Victoria Street, Abbotsford to construct the 'Precinct' mixed-use residential, retail, and office development on this land.

68 The Precinct was to comprise a large high-density urban renewal project on an old industrial site and ultimately consisted of a three-level basement carpark and five individual buildings including:

(a) 467 residential apartments;

(b) 6-storey childcare centre;

(c) 1,127 square metre ground floor retail shop;

(d) ground floor café; and

(e) associated amenities and landscaped complex grounds.

69 Maitland states that FDG commenced selling the apartments in the Project under an off the plan contract of sale in 2010.

70 Maitland also states that, under a development agreement dated 28 April 2011, FDG appointed V601 to carry out the development of the Project. Under this agreement, V601 was responsible for:

(a) development and construction in accordance with the approved planning permit, including any amendments required to complete the project;

(b) financing; and

(c) marketing for the Project.

71 The agreement provided for the Project to be completed, at that stage, in seven different separable portions, each with its own separate forecast date for completion.

72 Maitland's statement also refers to V601 having entered into a facility agreement with Precinct Australia Pte Ltd (CapitaLand) on 28 March 2011 for the financing of the Project. Under the facility agreement, subject to V601 initially satisfying numerous conditions, CapitaLand would finance the majority of the progress payments payable to the Contractor of the Project.

73 Maitland refers to the above financing agreement being varied a number of times during the project, and also explains that CapitaLand was a wholly-owned subsidiary of the Singapore publicly listed company, CapitaLand Limited. He stated that, as part of the financing arrangements, V601 was required to:

(a) enter into a building contract with a Contractor;

(b) contribute equity into the Project such that, at all times, the costs to complete the development in its entirety were equal to or less than the undrawn facility amount; and

(c) complete the project before the expiry date of the facility.

74 In its closing submissions, V601 submitted that the majority of Maitland's evidence had not been contested, and also submitted that in relation to the alleged 9A Agreement, which gives rise to one issue between the parties, Maitland had no more than his attention drawn to an email dated 9 May 2012[56] which V601 claims supports its case that the agreement to commence main works on 22 December 2011 concluded the contractual mechanism of granting Site access, and the amended dates for PC. V601 also asserts that this agreement included that no further adjustment under cl 9A(c) was to occur after 21 December 2011, and that subsequent delays were to be treated as EOTs under cl 34 the Contract.[57]

75 V601 also submitted that other than the above, Maitland was primarily cross-examined in relation to the Project Manager's independence, which V601 asserts is irrelevant to the issues in this proceeding. V601 submitted that Maitland's credibility has not been undermined in any meaningful way during the course of this proceeding and, in any event, his uncontested evidence should be accepted by this Court.

76 Probuild submitted that the Court should treat Maitland's evidence with caution.

77 Probuild submits that Maitland's second witness statement is largely irrelevant to the issues before the Court.

78 Under cross-examination, Probuild submitted that Maitland was reluctant to directly answer the questions put to him and sought to qualify answers depending on the meaning of ordinary words,[58] to avoid matters put to him by seeking to proffer answers to different questions,[59] or by having recourse to 'context' to avoid answering questions that reflected poorly on V601.[60] Probuild submits that the context referred to by Maitland was often irrelevant and contradicted the plain text of the correspondence in issue, and did not respond to the question asked.

79 For example, early in his cross-examination, Maitland was taken to a significant document in the proceeding, namely a letter from SPG to Probuild dated 7 September 2012. The letter in question came into existence after Probuild submitted its EOT2A and 3 claims. The letter enclosed the Project Manager's draft determination about those Probuild claims, and a 'Mitigation Actions' report prepared by programming and time extension consultants, Tracey Brunstrom & Hammond (TBH).[61] Maitland's evidence confirmed his involvement in drafting the covering letter, and also confirmed that he had signed that letter on SPG's behalf.[62] Maitland was cross-examined as to how it was that the Project Manager's draft determination came to V601. In response, Maitland sought to provide 'background' evidence about Mr Mehrten (Mehrten) (Probuild) and SPG seeking to settle Probuild's claims.[63]

80 However, in my view, the 'background', as Maitland sought to characterise this aspect, does not square with the letter of 7 September 2012 which does not reflect that it was sent as part of an effort to compromise Probuild's claims.

81 Further, as Probuild points out, V601 sought to claim privilege in respect of the 7 September 2012 letter and attachments. As a result, Mr Anthony Nolan QC was appointed as a Special Referee in this proceeding. Mr Nolan held that V601's letter of 7 September 2012 was not part of a process of negotiation to resolve the underlying dispute between V601 and Probuild, and was therefore not privileged.[64]

82 I consider that Maitland's evidence, including for the above reasons, was frequently unsatisfactory and astute to present and support V601's case and to avoid accepting or conceding facts which he perceived might be harmful or unhelpful to V601.

83 For the above reasons I have ascribed less weight to Maitland's evidence in relation to matters in issue, unless corroborated or unequivocally supported by other evidence, or uncontradicted.

84 Mr John Nave (Nave) gave evidence that he is a Director of First Urban, a project management, development management, and construction management company.

(a) Bachelor of Architecture (Hons);

(b) Bachelor of Building (Deakin University); and

(c) Registered Commercial Builder.

86 Nave's evidence was that he has 20 years' experience acting as director, construction manager, project manager, and project coordinator in the commercial construction industry.[65]

87 Nave also stated that First Urban is engaged as development management, project manager, construction manager, and contract superintendent for residential and residential mixed-use projects, and commercial fit-out works.

88 Nave's evidence was that First Urban was appointed as Project Manager under the Contract on 3 February 2011.

89 Nave's witness statement (dated 3 February 2019) explained that in relation to the Precinct Project, he was the Project Manager's Representative under the Contract and that he exercised the delegated powers of the Project Manager on behalf of First Urban. Nave states that he was assisted in performing this function by various other members of the team at First Urban, including his assistant, Ms Josie Coraci (Coraci), and Wei Lim. However, Nave's evidence was that all directions and determinations issued by First Urban were made by him and were his responsibility. Nave stated that, as Project Manager, he had various roles under the Contract which are described in cl 20.

90 Nave also stated that it was his practice to attend the Site weekly, or every other week, to see the status of the works, as well as to attend various other meetings at the Probuild Site office which was located on the corner of Grosvenor Street and Victoria Street. Other members of his team would also attend the Site, approximately twice weekly.

91 Nave stated that he would generally attend the following Precinct project meetings:

(a) Project Control Group (PCG) meetings:

These meetings were held monthly with V601, Probuild, and others as required for the relevant stage of the Works. Prior to each PCG meeting, Probuild would circulate a draft report in a form which had been agreed upon earlier. Nave would sometimes provide comments on that draft. Probuild produced the Minutes of these meetings and circulated those Minutes to the attendees;

(b) Construction Meetings:

These meetings were usually held weekly with Probuild. Minutes of these meetings were also produced by Probuild and circulated to attendees;

(c) Design Meetings:

These meetings were held weekly with Probuild and the Consultant team. Minutes of these meetings were also produced by Probuild and circulated to the attendees; and

(e) various other meetings as required on an ad hoc basis.

92 Nave's statement explains that project communications with Probuild were usually by way of Aconex communications.

93 V601 submitted that Nave was a patently honest witness, who was subject to a vigorous and lengthy cross-examination, and gave honest answers to all questions. V601 submitted that there was no significant matter in relation to which he had been shown to have been dishonest.

94 V601 seeks to explain that Nave was in a challenging situation because he had a client and a contractor, both of whom engaged with him and, at times, questioned whether he had the required ability to manage the project. V601 submits that Nave's situation was made more difficult, because he was trying to administer a Contract in circumstances where Probuild was deliberately withholding the information required for him to make relevant decisions.

95 V601 submits that much of Probuild's cross-examination to impugn Nave's independence was irrelevant to the issues in this proceeding. It further submits that, in any event, Nave's evidence was consistent with his witness statement and demonstrates knowledge of the project, as well as his frustration at both parties' attempts to convince him to side with them in relation to the claims. V601 also submits that Nave was not challenged on his evidence, and that both parties placed significant pressure on him during his analysis of the extensions of time.[66]

96 V601 argues that Probuild has criticised Nave for trying to conceal the involvement of TBH and V601's lawyers, Baker McKenzie, in the time extension assessment process.[67] V601 also asserts that contemporaneous emails between Probuild employees demonstrate a full awareness of the roles played by TBH and V601's lawyers, prior to Nave making his assessment of EOT2A and EOT3.[68] In this regard, V601 observes that Probuild had also subpoenaed Nave in 2017 and had access to the documents produced by Nave from that time, including documents which revealed his interactions with TBH and with V601's lawyers.

97 In its submissions, V601 notes Probuild's suggestion that Nave's proposal of a profit-sharing arrangement somehow tarnished his role as Project Manager.[69] V601 says that this suggestion is rebutted by Nave's unequivocal evidence that the profit-sharing arrangement was never agreed to; that it was proposed well before the Contract being entered into; and that the Contract ultimately entered into between Nave and SPG was an AS4122-2000, pursuant to which Nave was paid a flat fee for project management services.[70]

98 V601's overarching submission is that Nave was an honest witness who tried his best to explain his conduct in very difficult circumstances and that his evidence should be accepted.

99 Probuild however submits that Nave was a most unsatisfactory witness and that the Court should attach no weight to his evidence, unless it is corroborated by contemporaneous records.

100 Probuild submits that Nave's witness statement was not designed to assist the Court in fully understanding how he acted as Project Manager. In setting out his 'process' for dealing with Probuild, and for making purported 'determinations', Probuild submits that Nave deliberately chose not to make reference to his numerous interactions with V601, its lawyers, or TBH. Probuild also strenuously submits that this was a major omission, particularly given Nave's assertion that he made the assessments; that he made them independently;[71] and that his assessments were 'correct'.[72]

101 Probuild maintains that Nave did not reveal his interactions with V601, V601's lawyers, and TBG during the Project, and submits that Nave chose not to reveal those interactions when compiling his witness statement. Probuild submits that Nave's witness statement gives a false impression about how he interacted with both V601, chiefly with Maitland, and Mackenzie, the Development Director supporting the Project Manager, in relation to key project decisions and Probuild.

102 Probuild's submissions include that, at no stage, did Nave understand what it meant to be independent in his Project Manager role of assessor and certifier of the Contractor's entitlements under the Contract, and therefore it is unsurprising that he did not act independently.

103 Probuild further submits that Nave's lack of independence was not an innocent error.

104 Probuild highlights and submits that V601's year-long but unsuccessful effort to claim privilege over hundreds of documents relating to the true factual situation, and the story that these documents ultimately revealed, is very relevant.

105 During the trial, Probuild compiled and filed a document setting out the 'indicia' on which it relies to establish that the Project Manager lacked independence in his role as assessor and certifier.[73] That document, Annexure 2 to Probuild's Closing Submissions dated 11 June 2019, identifies the evidence establishing each indicium of the Project Manager's lack of independence and explains the evidence relied on by Probuild.[74]

106 I note, however, that V601 did not specifically address, or even in my view seriously attempt to rebut, Probuild's Annexure 2 evidence. This is not an isolated observation concerning V601's case and is one that can also be made in respect of various other bodies of specific and very significant evidence relied upon by Probuild, as identified below, including in relation to Probuild's Anneuxre 2 and in relation to the evidence given by Bready, Probuild's Project Manager.

107 Although I deal in more detail with Nave's evidence below, at this point it is convenient to make the general observation and findings below.

108 I am unpersuaded by Nave's evidence in relation to issues relevant to his independence, examples of which are included below.

109 I do not accept Nave's denial that he sought advice from V601's lawyers in relation to Probuild's assertions regarding his independence as Project Manager. Nave was cross-examined about whether he had sought such advice from V601's lawyers. His answer was, 'No, I didn't'.[75] However, Nave's email to V601's lawyers dated 22 October 2012 sought such advice.[76]

110 Neither do I accept Nave's evidence that he did not recall meetings with V601's lawyers during the Project. In cross-examination, when this was put to him, Nave stated, 'Possibly, I just can't recall how many.'[77] However, I find that Nave had many critical meetings with V601 and its lawyers, including to discuss V601's tactics and strategy for dealing with Probuild's claims.[78]

111 Nave, in substance, denied that the Project Manager had engaged TBH.[79] I find that First Urban, in fact, initially engaged TBH in or about April/May 2012.

112 Similarly, I do not accept Nave's denial of being aware that V601's financiers had refused drawdowns, because Probuild's delay claims were resolved.[80] On 25 May 2012, Nave received an email from Maitland which stated: 'See below update from CapitaLand confirming no more draws until EOT's [sic] resolved with Probuild as discussed.'[81]

113 I also reject the suggestion that Nave's statements in First Urban's email, dated 12 June 2012,[82] were other than the communication by Nave of his prejudgement and predetermination in relation to his rejection of Probuild's Façade Variation, irrespective of how Probuild sought to justify and substantiate that claim.[83]

114 Furthermore, I do not accept Nave's evidence that he signed a 'draft' of the determination of Probuild's EOT2A and EOT3 claims of 15 August 2012. That draft determination accepted and adopted the dates in TBH's report on the initial analysis of the EOT2 and EOT3 claims.[84] In cross-examination, Nave asserted that the draft determination was not provided to V601 because he was not satisfied that it was accurate.[85]

115 V601 received a copy of the Project Manager's draft determination in relation to EOT2A and EOT3 on 7 September 2012.[86] Nave conceded that he knew the draft determination had been sent to V601, even though it was inaccurate.[87]

116 I do not accept Nave's evidence that he was unaware of V601's strategy of issuing draft determinations communicated to Probuild in relation to Probuild's contractual claims, as part of a process facilitated by V601 and the Project Manager pursuant to which V601 sought to delay certification of Probuild's contractual entitlement to extensions of time and obtain leverage in V601's negotiation to defeat or reduce Probuild's claims.[88]

117 In this regard, I am satisfied that the Project Manager's determination of 7 September 2012 was not a true reflection of the Project Manager's opinions and that V601 used the second draft determination in relation to the claims then being dealt with as part of its efforts to procure a settlement with Probuild of Probuild's subject time extension claims.[89]

118 On 6 September 2012, Nave participated in a telephone conversation with TBH, Mackenzie, and Alison Ashford of V601's lawyers.[90] A file note of that conversation records the discussion being concerned with 'want[ing] to identify where Probuild is going and whether things are getting worse', and 'when Probuild & V601 meet tomorrow what do we give them and why'. The note also states that 'Mario [Salvo] wants document to provide at meeting', which included the list of documents in 'John's determination' and the 'TBH summary'. Under cross-examination, Nave conceded that he 'knew there was a negotiation that was about to occur'.[91] Despite Nave acknowledging that the 7 September 2012 draft determination did not reflect his opinion and that he would never sign it,[92] Nave failed to inform Probuild that the draft determination did not reflect his opinion, nor did he take any steps to correct this position.

119 As a result of the matters that I have referred to and the further matter concerning the Project Manager's conduct outlined below, I am comfortably satisfied that although Nave occupied the position of the Project Manager which under the contract was charged with the independent role of assessor and certifier, Nave was working in concert with V601 to have Probuild believe that the Project Manager's determination would be that contained in the draft letter of 7 September 2012, in order to place V601 in a more advantageous position to negotiate a settlement with Probuild, and at a time which V601's financiers refused further drawdowns. However, Nave denied that this was the case.[93]

120 Furthermore, I do not accept Nave's evidence that he was not involved with V601 in devising a strategy to delay and minimise Probuild's contractual entitlements.[94] I find that he was so involved. This I consider is clearly established by the file notes of meetings involving the Project Manager and V601's lawyers, addressed below. Those contemporaneous notes comfortably satisfy me that Nave actively participated, without objection or demur, in meetings with V601 and its lawyers to develop, agree and implement a strategy and tactics to delay and minimise Probuild's contractual claims for extensions of time.[95]

121 I am also comfortably persuaded that at the time Nave gave evidence under cross-examination in these proceedings, he would have been most unlikely to have forgotten the fact and nature of meetings like the one with V601's lawyers on 16 August 2012.

122 In the Nave Witness Statement, at [581], Nave stated unequivocally that Probuild's request for Practical Completion was not properly made because it was not compliant with cl 34.6(b) of the Contract. Under cross-examination, Nave agreed that the point made by him about Probuild's non-compliance was suggested to him by V601's lawyers; that he thought the point was 'highly technical'; and that he did not agree with it. Notwithstanding his views, Nave sent Probuild the letter drafted by V601's lawyers to Probuild raising the above point as to non-compliance.[96]

123 Beyond the above examples of Nave's unacceptable, inaccurate, and unpersuasive evidence, Nave was also cross-examined suggesting that his assessment of Probuild's EOT2A and EOT3 claims (made on 15 August 2012, 7 September 2012, and 20 September 2012) were similarly inappropriately and unduly influenced by V601, and its advisers. In response Nave attempted to substantiate the processes by which he had assessed Probuild's delay claims.

124 Ultimately, I consider that the processes engaged in by the Project Manager to assess the above Probuild EOT and completion claims amounted to the Project Manager doing little more than simply adopting V601's preferred position, via its programming and time extension consultant, TBH, and its analysis in relation to Probuild's claims.[97]

125 Nave also gave evidence that his purported determinations did not take into account the mitigation measures that TBH had identified;[98] however, First Urban's purported determination dated 20 September 2012 reveals that the extensions of time awarded for SP2 and SP5 'incorporated the mitigation strategies set out in the Annexure to this letter'.[99]

126 For the reasons referred to above, in relation to the examples highlighted to this point, I find that Nave's evidence demonstrated his significantly impaired understanding and appreciation of the required level of independence which the Contract imposed on the Project Manager in relation to the assessment and certification of the Contractor's entitlements.

127 Further, for the above reason, and for the reasons outlined below, including in relation to Annexure 2 of Probuld's closing submissions, on any disputed subject matter, save when supported by other reliable evidence or contemporaneous documentation, I give very little or no weight to Nave's evidence and the Project Manager's purported assessments and certifications under the Contract or its communications generally in relation to the Precinct Project.

128 Mr Stephen Abbott (Abbott) is an expert witness instructed by V601's lawyers to prepare an independent expert report in relation to programming, delay, and time extension issues.

129 Abbott's evidence included that he is the Managing Director and Principal of SJA Construction Services Pty Ltd, which he formed in 1999 to provide specialist services to stakeholders of the building, construction, and engineering industries including: construction consulting including independent expert services; quantity surveying/cost planning services; project management services; and planning and programming services.

130 Abbott has 39 years' experience in the building, construction, and engineering industries. During this time, he has performed roles ranging from carpenter to senior management positions for some of the largest construction organisations in Australia. Abbott has spent many years working on both small and major construction projects, in various hands-on roles including Project Manager, Construction Manager, and many years in senior managerial roles within the Australian construction industry. Abbott's evidence was that he has had direct hands-on experience with many of the various forms of project delivery used within the Australian building and construction industry. Abbott has also had direct involvement in many major construction projects in the role of construction consultant/expert and, in that capacity, with many significant construction projects.

131 Abbott's experience has also involved the provision of expert witness services for arbitrations and mediations in jurisdictions that include the Local, District, and Supreme Courts of various Australian states, where he has dealt with construction-related issues including the analysis of delay and disruption (expert advice, reporting, and expert witness services related to construction planning and programming) and the assessment of claims/quantum assessments (expert advice, reporting, and expert witness services related to assessment of construction costs, variations, delay/disruption costs, and other quantum claims).

132 Abbott holds a Bachelor of Commerce Degree with a Management Major from the University of Western Sydney, and has completed many relevant construction, management, and specialist training courses. He is also a Fellow of the Australian Institute of Project Management; a Fellow of the Australian Institute of Management; a Fellow of the Australian Institute of Building; a Member of the Resolution Institute (formally the Institute of Arbitrators and Mediators Australia); a Member of the Society of Construction Law; a Member of the Chartered Institute of Arbitrators (UK); and a Certified Practicing Project Manager with the Australian Institute of Project Management.

133 Abbott was instructed to provide expert opinions as detailed in two letters of instruction from V601's lawyers dated 14 June 2018 and 12 August 2018. Abbott, in preparing his first expert report dated 12 September 2018, was instructed by Baker McKenzie and V601 to review the materials and documents included in his brief, and then prepare a report commenting on the methodology used by Probuild's Programming delay and time extension expert, Mr James Lyall (Lyall), in relation to Lyall's reports dated 12 April 2018 and 4 May 2018, as well as providing responses to three key questions in relation to claims by Probuild against V601 for delay and how the Contractor should seek to minimise the impact of delay.

134 By letter of instruction from V601's lawyers dated 16 October 2018, Abbott was further instructed by V601 to prepare a supplementary report in relation to delay and time extension-related matters concerning Probuild's claims, and in relation to Probuild's entitlements to extensions of time.

135 Abbott and Peter Picking (Picking), the latter an Expert engaged by Probuild, also produced a joint report entitled Programming Experts' Joint Report 1 (5 February 2019). In this report, Abbott and Picking summarise the points of agreement and disagreement in relation to programming issues, including what actions a reasonable design and construct contractor would take to minimise the impact of delays.

136 Abbott and Lyall also produced joint reports entitled Programming Experts' Joint Report 2 (8 February 2019) and Programming Experts' Joint Report 3 (15 February 2019).

137 The Programming Experts' Joint Report 2 principally addresses Abbott's and Lyall's positions in relation to prospective and retrospective analyses of delay.

138 The Programming Experts' Joint Report 3 further addresses Abbott's and Lyall's programming conclusions in the Programming Experts' Joint Report 2.

139 Mr Neil Birchall (Birchall) is an Expert Quantity Surveyor and Estimator engaged by V601's lawyers to provide evidence in these proceedings, including in relation to Probuild's evidence from its quantum expert, Mr Bill Cox. Birchall is employed by SJA Construction Services Pty Ltd in the capacity of Area Manager Construction Consulting.

140 Birchall's qualifications include a Higher National Diploma in Building, an Honours Degree in Law, a Post‐Graduate Diploma in Vocational Training for the Bar (England and Wales). Birchall also states that he was called to the Bar in 2006 and is a non‐registered member of the Bar of England and Wales, as well as a Member of the Chartered Institute of Arbitrators and a Member of the Society of Construction Law Australia.

141 Birchall states that he has been employed in the construction industry for over 30 years and, during that time, he has worked for contractors, subcontractors, consultants, suppliers, and owners/principals, including in positions as Estimator/Surveyor, Quantity Surveyor, Managing Quantity Surveyor, and Commercial Manager. Birchall was previously the Associate Director of an international quantity surveying practice, and a self‐employed contracts and commercial consultant. He has been instructed both as a party‐appointed expert and as a court‐appointed expert.

142 By letter of instruction dated 14 June 2018, Birchall was instructed by V601's lawyers, Baker McKenzie, to provide his opinion as to whether he concurred with the opinions stated in the Cox Report, Probuild's Quantum Expert, in respect of Probuild's quantum evidence.

143 By letter of instruction dated 5 October 2018 from V601's lawyers, Baker McKenzie, Birchall was further instructed to provide an opinion on the assessment of Probuild's entitlement to delay damages in relation to its EOT2/2A, EOT3, EOT6 and EOT7 extension of time claims, including in respect of Probuild's extension of time entitlements, as assessed by the Project Manager and Probuild's expert programmer, Lyall.

Birchall Third Addendum Report (17 October 2018)

144 By letter of instruction dated 16 October 2018, Birchall was further instructed to provide an opinion on the assessment of Probuild's entitlement to delay damages, in relation to its EOT2/2A, EOT3, EOT6 and EOT7 time extension claims. This Third Birchall Report was particularly directed to assessing the quantum of delay damages in relation to Probuild's EOT claims EOT2/2A, EOT3 and EOT6.

145 Birchall and Cox also produced joint experts' reports entitled Quantum Experts' Joint Report 1 (5 February 2019) and Quantum Experts' Joint Report 2 (13 February 2019).

146 Probuild's principal witness of fact, Mr Matthew Bready (Bready), stated that he had worked as a Construction Manager for Probuild since 1994, including in the roles of estimating assistant, estimator, contract administrator, project manager, senior project manager, project director, and construction manager, and in these roles had worked on various commercial, fit-out, retail, and residential developments.[100]

147 Bready's evidence was that his qualifications included a Certificate of Technology (Advanced Building Construction) (1993) and an Advanced Certificate in Building Construction (1993), both from Swinburne University of Technology.

148 Bready gave evidence that he was Probuild's Construction Manager for almost the duration of Probuild's involvement on the Precinct Project, initially in a limited role, because he was working for Probuild to complete another project in Southbank.

149 Bready's evidence was that, in his role as Construction Manager, he was responsible for planning and monitoring construction-related matters during the Project's construction phase. These responsibilities included obtaining input from subcontractors and suppliers, as well as providing programming and buildability advice. Bready was supported in his roles by Probuild's Site management, supervision, contracts administration, and direct labour teams, and by Probuild's commercial, finance, environmental health and safety, and human resources and quality teams based in its head office.

150 Bready stated that he started working on the Project on a full-time basis in late 2011 and before that, he would typically attend the Site two or three times a week to monitor the progress of the Early Works, and was based at the Site from late 2011 until around February 2014.

151 Probuild relies on three Witness Statements from Bready.

152 Bready's evidence on the events on-site and key communications between the significant persons involved in the performance of the Early Works, and then the WUC, is very detailed and I consider objective, very accurate and reliable and in respect of almost all factual matters to do with the Works and communications and decision concerning the Works, substantiated by contemporaneous project documentation and similar materials.

153 Probuild submits that Bready's evidence should be wholly accepted. Probuild submits that Bready's evidence demonstrates the breadth of his knowledge about the Project and his extensive experience as a construction manager. He was a truthful witness, and gave succinct, direct answers to the questions asked in cross-examination. The vast majority of his evidence was not challenged, either in V601's lay witness statements, expert reports, or in cross-examination. I accept each of Probuild's submissions and assertions referred to in this paragraph.

154 As I have earlier separately noted, in respect of most of the detail of the events and occurrences on-site during the performance of the Early Works and the WUC, Bready's contemporaneous first-hand evidence is not rebutted by a comparable V601 witness who was able to give evidence in relation to events and occurrences affecting the works. Bready's evidence is also almost always supported by contemporaneous documents or other contemporaneous materials. As to these matters, I have found Bready's evidence very reliable, and very persuasive and most helpful.

155 On the few occasions where Bready's evidence was challenged, Bready convincingly justified his position and the version of the relevant facts he deposed to or, where appropriate, made concessions.

156 Probuild submits that Bready's evidence should be accepted, on the basis that he has 'demonstrated the breadth of his knowledge about the Project and his extensive experience as a construction manager'.[101] I wholly accept that submission for the reasons I have outlined.

157 V601, however, submits that in cross-examination, Bready was found to have engaged in improper conduct to advance his employer's commercial interests at the expense of V601. V601 asserts that Bready has now admitted to making multi-million-dollar claims:

(a) without conducting a critical delay analysis - being the primary foundation for any extension of time under the Contract;

(b) knowing that various dates listed in the claims were incorrect and/or could never have actually been achieved by Probuild;

(c) while maintaining strict control over the programs that supposedly substantiated those claims; and

(d) without providing the Project Manager with any of the further information requested as part of his attempts to analyse those claims.

158 V601 submits that Bready also made statements that cannot be accepted, such as:

(a) he was unaware that the VCAT application only related to 15 apartments; and

(b) he had no expertise in critical path analysis.

159 As a result of the above, V601 submits that Bready was only honest in his evidence once he was found out. V601 submits that Probuild's representation of Bready as an avuncular figure, who could be trusted and relied on by the Court, is contradicted by the above matters.

160 For the reasons I have outlined above, and also for the reasons concerning Bready's evidence separately outlined below, I wholly reject V601's submissions in the preceding paragraphs.

161 Mr Giuseppe (Joe) Cirianni's (Cirianni) evidence was that he was the Site Operations Manager on the Precinct Project employed by Probuild since February 2009. Cirianni stated that his relevant work experience since 1983 included work for Westfield between 2007 and 2008 on the construction of the South Morang Shopping Centre, and prior to that, work for Brookfield Multiplex from 1995 until 2007.

162 Cirianni stated that his qualifications include a Certificate in Construction from Swinburne University of Technology and Preston TAFE (1987); a Certificate IV in Business (2005); and a Certificate III in Occupational Health and Safety from the Master Builders Association (2009).

163 Cirianni became Probuild's Site Operations Manager in November 2017.[102]

164 As Site Operations Manager, Cirianni is assisted by a team of Site supervisors who also work on-site and are responsible for managing a particular trade or area of work.

165 During his career, Cirianni stated he has worked on various commercial, fit-out, retail, and residential developments.[103]

Cirianni Witness Statement (23 February 2018)

166 In his witness statement dated 23 February 2018, Cirianni stated that he maintained the daily Site diary for the Precinct Project and that he prepared the Minutes of the meeting with HWM Contractors Pty Ltd, the earthworks contractor for the Early Works.

167 V601 agreed to the Cirianni Witness Statement being tendered and did not require Cirianni for cross-examination.[104] I have considered and accept Cirianni's evidence.[105]

168 Ms Rebeca Lunardello (Lunardello) is an experienced assistant accountant and Payroll Manager employed by Probuild since 2000.

169 Lunardello's qualifications include a bachelor's degree in International Business from Instituto Tecnologico de Monterrey, a Mexican university.

Lunardello Witness Statements (23 February 2018 and 16 October 2018)

170 In her witness statements dated 23 February 2018, Lunardello explains the Precinct Project payment and cost recording system, including Probuild's detailed cost reports generated on Probuild's 'BLU' accounting software.

171 V601 agreed to the Lunardello Witness Statements being tendered and did not require Lunardello for cross-examination.[106] I have considered and accept Lunardello's evidence.[107]

172 Mr James Lyall (Lyall) provided expert programming, delay, and time extension-related evidence in support of Probuild's delay claims. Lyall is employed as a Partner-Delay Expert Services by HKA, a specialist contract and commercial consultancy to the building, construction, and engineering industries.

173 Lyall has over 17 years' experience of planning in construction and engineering projects. He is a Member of the Chartered Institute of Arbitrators and a Practicing Member of the Academy of Experts. Lyall's qualifications include a Master's Degree in Construction Law and Dispute Resolution awarded by King's College London (2012), and a Bachelor's Degree in Building, Management and Technology awarded by the University of Liverpool (2001).

174 By letter of instruction dated 23 December 2016, Probuild's lawyers requested that Lyall, amongst other things:

(a) prepare a report setting out his expert opinion as to whether the delay events which were the subject of Probuild's EOT claims 1, 2A, 3, 4, 6 and 7 affected an activity on the critical path of the Approved Contractor's Program, as it existed at the time of the occurrence of the cause of delay and, if so, to what extent;

(b) with respect to Probuild's EOT claims 1, 2A, 3, 4, 6 and 7, provide an expert opinion as to whether Probuild took all reasonable measures to minimise the delay incurred, including by resequencing or reprogramming the performance of WUC where it was reasonably practicable to do so; and

(c) with respect to Probuild's EOT claims 1, 2A and 3, provide an expert opinion as to whether the delay events delayed or disrupted Probuild, and, if so, to what extent, identifying all critical and non-critical delays and disruptions.

175 A summary of the claims made by V601 and Probuild in the Proceeding on which Lyall was asked to provide his expert opinion are as follows (by way of extract from Probuild's lawyers' instructions to Lyall):

3.1 V601 claims an entitlement to liquidated damages in the sum of $4,712,519 as a result of Probuild's alleged failure to achieve Practical Completion for certain Separable Portions by the relevant Date for Practical Completion under the Contract;

3.2 Probuild (amongst other things):

3.2.1 denies that any liquidated damages are due and payable to V601; and

3.2.2 alleges an entitlement to delay damages, bonus payments and/or acceleration payments;

on account of EOTs to which Probuild was entitled under the Contract; and

3.3 Probuild also claims an entitlement to be paid a Variation, relating to the construction of the façade return walls in precast concrete.

4. A 'staging plan' depicting the location of each of the buildings forming part of the Project on the Site (Staging Plan) is included in the Contract.

5. The 'Works' comprised eight separable portions (SPs), as follows:

5.1 Building A1 (SP 1). This is a retail building and associated car parking area at the southern end of the Site facing onto Victoria Street, as depicted in red on page 1 of the Staging Plan;

5.2 Building C1 (SP 2). This is the commercial component of Building C, and associated car parking areas, as depicted in light blue at page 2 of the Staging Plan;

5.3 Building D (SP 3). This is a residential building, and associated car parking, as depicted in dark blue at page 3 of the Staging Plan;

5.4 Building E (SP 4). This is another residential building and associated car parking, as depicted in green at page 4 of the Staging Plan;

5.5 Building C2 (SP 5). This is the residential component of Building C, and associated car parking areas, as depicted in orange at page 5 of the Staging Plan;

5.6 Building B (SP 6). This is another residential building with associated car parking areas, as depicted in purple at page 6 of the Staging Plan;

5.7 Building A2 (SP 6A). This comprises the residential areas of Building A with associated car parking areas, as depicted in purple at page 6 of the Staging Plan; and

5.8 Practical Completion (SP 7).

6. The Project Manager under the Contract was First Urban Pty Ltd.

7. Probuild entered into a separate contract with V601 as construction manager for 'early works' on the Site including demolition, excavation, piling and other associated early works (Early Works Contract).

Dates for Practical Completion

8. The parties agreed that for the purposes of clause 9A(b)(iii) of the Contract the WUC would commence on 22 December 2011; and

8.2 The Dates for Practical Completion for each Separable Portion were changed from the dates in Annexure Part A of the Contract to the following dates:

Changed Date for Practical Completion

[see letter 16/2/18 Probuild's lawyers to Lyall]

18 April 2013

[see letter 16/2/18 Probuild's lawyers to Lyall]

Summary of Probuild's EOT claims

19. In essence, the EOT claims by Probuild in the Proceeding are:.

EOT 1 - 'soft start'

20. As set out above, Probuild carried out some Early Works at the Site under a separate Early Works Contract.

21. In the Proceeding, Probuild claims an EOT under clause 9A and/or 34 of the Contract for the period up to the date on which Early Works Completion was actually achieved.

EOTs 2A and 3 - soft spots, contamination and vapour barrier

22. 'EOT 2A' relates to delays caused by the discovery of unstable subsoil conditions in the area of the Site to the north of Shamrock Street (Soft Spots).

23. Probuild asserts that the Soft Spots meant that it was necessary:

23.1 for contractors performing the Early Works to install a piling platform to enable access by piling rigs and sheet piling for the core to Building E; and

23.2 for Probuild to redesign the piling and retention works in the area of the Site to the north of Shamrock Street on account of the Soft Spots.

24. 'EOT 3' relates to the discovery of petrochemical contamination of the ground in the south-west corner of the Site (Contamination). Upon discovering the existence of Contamination, it was necessary for contractors performing the Early Works to design and install a vapour barrier.

EOT 6 - Childcare

27. In respect of 'EOT 6', Probuild claims that it was delayed as a result of the following:

27.1 in around mid-2012, V601 notified Probuild that it intended to alter the designated use of part of Building C from commercial space to space allocated for a childcare centre;

27.2 between mid-2012 and 13 February 2013, V601 did not make a decision and, or alternatively, did not notify Probuild of any decision, to alter the designated use of part of Building C from commercial space to space allocated for a childcare centre; and/or

27.3 on or about 13 February 2013, the Project Manager directed Probuild to vary the WUC by altering the designated use of part of Building C from commercial space to space allocated for a childcare centre.

EOT 7 - town planning - glazing

28. Probuild claims that:

28.1 V601 did not obtain town-planning approval in relation to the glazing performance criteria, including acoustic requirements, for the windows to be incorporated into the Works until about 14 December 2012; and

28.2 it was delayed in completing the glazing matrix for the windows to be included in the works until town-planning approval had been obtained in relation to the glazing performance criteria, such that:

28.2.1 it could not take steps to procure the glazing or window frames to be included in the works in accordance with its obligations under clause 11.1(c) of the Contract before about 14 December 2012; and/or

28.2.2 the glazing or window frames were not available for incorporation in the works in accordance with Probuild's obligations under clause 11.1(c) of the Contract.

176 By letter of instruction dated 16 February 2017, Probuild's lawyers further requested that Lyall:

(a) provide expert opinion as to whether in relation to Probuild's EOT claims 1, 2A, 3, 4, 6 and 7, Probuild took all reasonable measures to minimise the delay incurred, including by resequencing or reprogramming the performance of WUC where it was reasonably practicable to do so; and

(b) provide expert opinion as to whether in relation to Probuild's EOT claims 1, 2A and 3, the delay events delayed or disrupted Probuild, and, if so, to what extent. In answering this question, please identify all critical and non-critical delays and disruptions.

177 By letter of instruction dated 24 April 2018, Lyall was requested by Probuild's lawyers to provide a supplementary report including:

(a) A visual representation (for example, in the form of a gantt chart or program) showing:

(i) the assessed critical delay periods from your Report in:

A. calendar days; and

B. Working Days;

for each delay event so that the extent of any cross-over between events can easily be seen; and

(ii) the period(s) of time (in both calendar and Working Days) when:

1. cranes were on site; and

2. hoists were on site; and

(b) a separate calculation of the assessed critical delay periods from your Report (expressed in both calendar days and Working Days), having regard to any period of overlap between delay events (i.e. so that where 2 Separable Portions are in delay on a given Working Day, that Working Day is counted only once).

178 By further letter of instruction dated 13 December 2018, Probuild's lawyers requested that Lyall:

(a) provide a supplementary report which responds to the two reports provided by Abbott dated 12 September 2018 and 17 October 2018, and provides a prospective assessment of EOTs 2A, 3, 4, 6 and 7; and

(i) in addition to preparing a report which replies to the expert report of Mr Steve Abbott dated 12 September 2012 (First Abbott Report), you are instructed to prepare a report which replies to those aspects of Mr Abbott's report dated 17 October 2012 (Second Abbott Report) that you consider warrant a response or clarification;

(ii) in particular, at section 6.2.1 of the report of Steve Abbott dated 17 October 2018 (Second Abbott Report), Mr Abbott asserts that clause 34 of the Contract requires that there be a prospective form of delay analysis of the Extensions of Time the subject of the proceeding; and

(iii) we note in your first report that you say a retrospective analysis is appropriate in this case. However, for the purpose of this reply report, you are instructed to make the assumption that a prospective analysis is required by clause 34 of the Contract. Accordingly, could you please undertake such an analysis in respect of EOTs 2A, 3, 4, 6 and 7.

179 Lyall and Abbott also produced joint reports entitled Programming Experts' Joint Report 2 (8 February 2019) and Programming Experts' Joint Report 3 (15 February 2019).

180 Peter Picking (Picking) gave expert evidence in support of Probuild's Project management expert. Picking is a Consultant with Advisian Pty Ltd, having worked for Advisian since April 2014, with prior extensive experience in various roles with general contractors, a developer, and a specialist contractor, in respect of design management and delivery of a diverse range of projects.

181 Picking's experience includes his employment with Abigroup Contractors, responsible for the design and construction of the Multi-Use Arena (MUA) Contract in Sydney. This project incorporated the Sydney SuperDome PPP BOOT project, which was developed for the Olympic Games and which was to be operated by an Abigroup entity. The MUA works included the preparation of the existing Site civil works, the design and construction of the arena, the largest carpark in the southern hemisphere, and significant public domain landscaping.

182 Picking's qualifications include an Associateship Diploma of Building, Royal Melbourne Institute of Technology. He was the President, Master Builders Association of Victoria (2015-2016), immediate past President and Director of the Master Builders Association of Victoria, and a Fellow of the Australian Institute of Building.

183 By letter of instruction dated 3 October 2018, Probuild's lawyers asked Picking to address a number of issues, including three questions in relation to the Probuild claim 'EOT 7 - glazing/town planning', namely:

(a) Was Probuild provided with sufficient information to place the order for the windows prior to and at the date of the Contract.

(b) During the progress of the works, Probuild was informed that there was a proposed change to the design of some windows on the façade of the building on 15 of the 467 apartments to be constructed. Would that event prevent Probuild from:

(i) placing the order; and

(ii) installing;

the balance of the windows for the 452 apartments that were not affected by this change.

(c) Assume for the purposes that the effect of the variation was to prevent Probuild from ordering all the windows, what steps would a reasonable design and construct contractor take by way of temporary works or otherwise to mitigate the impact of the variation.

184 By a further letter of instruction dated 23 November 2018, Probuild's lawyers requested Picking to deal with:

EOT 2A: Discovery of soft spots

1. The Golders Report dated 30 June 2011 and 17 August 2011, 20 August 2011, 22 November 2011, 16 December 2011 and 18 January 2012 reveals the presence and extent of fill material over part of the Site. Golder's opine that the relevant area identified had a limited bearing capacity and would need to be reinforced to allow heavy machinery to operate on the identified area of the Site. In light of those reports:

(a) what steps should a reasonable D&C Contractor have taken to minimise the impact of the soft spots on the program?; and

(b) give your opinion as to whether Probuild took adequate steps to minimise the impact of the soft spots on the program.

2. Assume that Probuild made a decision in early April 2012 to relocate the ramp from Building C so as to encroach on Building E so as to make Building C available.

(a) Would a reasonable D&C Contractor have made such a decision in all the circumstances?

(b) Would a reasonable D&C Contractor have moved the ramp so as to prevent the completion of slab B8?

185 Probuild's lawyers also requested that Picking:

8.1 review the Abbott Supplementary Report, and

8.2 set out your expert opinion in response to the matters raised in the Abbott Supplementary Report relating to project management. Where you disagree with any of the conclusions reached by Mr Abbott, please explain why your opinion differs.

186 Picking and Abbott also produced a joint report entitled Programming Experts' Joint Report 1 (5 February 2019).

187 Mike Cox (Cox) gave evidence in support of Probuild's quantum case. Cox is a Chartered Quantity Surveyor with Currie & Brown, with over 35 years' experience in the construction industry, and has extensive experience in the preparation of estimates, cost planning, managing construction works, and finalising accounts, on various types of projects including residential and mixed-use developments.

188 Cox is a member of the Royal Institute of Chartered Surveyors (RICS). He holds an Advanced Professional Award in Expert Witness Evidence and is a member of the RICS Oceania Expert Witness Registration Scheme.

189 By letter of instruction dated 14 December 2017, Probuild's lawyers requested that Cox provide his expert opinion on Probuild's entitlement to delay damages, bonus payments, and/or an acceleration payment, as well as Probuild's entitlement to be paid a variation relating to the façade return walls.

190 Cox was also instructed to provide his opinion on Probuild's acceleration claims, in relation to which he was instructed as follows:

Summary of Acceleration Claim

33. Probuild asserts that it 'accelerated' the performance of WUC in an attempt to reduce or overcome one or more of the delay events the subject of Probuild's EOT claims 1, 2A, 3, 4, 6 and 7, or alternatively in an attempt to achieve Practical Completion by the Date for Practical Completion certified by the Project Manager.

34. Probuild claims to be entitled to recover from the Plaintiff the costs that Probuild incurred in accelerating the performance of the WUC by reason of (amongst other things) the Project Manager:

34.1 failing, refusing or neglecting to approve updated versions of programs submitted by Probuild to the Project Manager during the course of the Project; and/or

34.2 failing to grant in full extensions of time to the Dates for Practical Completion which Probuild was entitled to receive.

Summary of Prevention Principle claim

35. Probuild alternatively asserts that the Contract's mechanism for awarding extensions of time does not apply to its EOT claims 1, 2A, 3, 4, 6 and 7, and that it was prevented from achieving Practical Completion by the Dates for Practical Completion by the events giving rise to those EOT claims.

36. Probuild therefore claims to be entitled to recover from the Plaintiff the additional costs it incurred by reason of the delay or disruption caused by the events referred to above.

Summary of Façade Variation

37. Appendix 2 to the Contract contains the Principal's Project Requirements in relation to the Project (PPR). There is a 'Schedule of Clarifications' at the back of the PPR.

38. Item 14 of the Schedule of Clarifications provides that:

'The extent of precast concrete façade panels included in the Contract Sum is to be in accordance with the drawings marked up and included in the Preliminary Design.'

39. Probuild alleges that it was:

39.1 only obliged under the Contract to construct the façade panels referred to in Tender Addendum 4 from precast concrete, but there was no requirement to the effect that the return walls to those panels also to be constructed from precast concrete (and therefore it was permissible for Probuild to construct the return walls using a lightweight material); and

39.2 later directed to vary the WUC by constructing the façade return walls in precast concrete (Façade Variation).

191 By letter of instruction dated 21 September 2018 from Probuild's lawyers, Cox was provided with the following further instructions:

We have recently received correspondence from the Plaintiff's solicitors, in which they assert that Probuild must apportion its delay damages claims by reference to Separable Portions the subject of each extension of time (EOT) claim. This correspondence is enclosed for your reference.

It is a legal question as to whether delay damages are required to be apportioned in the manner asserted by the Plaintiff's solicitors. However, we anticipate that at the trial of this Proceeding, the Plaintiff will make the 'apportionment' argument it has foreshadowed in recent correspondence.

Accordingly, on the assumption that the Plaintiff's apportionment argument is correct, we request that you prepare a supplementary expert opinion which addresses the following:

(a) What is a reasonable methodology for apportioning Probuild's reasonable and necessarily incurred direct on-Site time-related costs, including on-Site preliminaries costs, to each Separable Portion the subject of an EOT claim, having regard to clause 34.9 of the Contract. In answering this question, please discuss why your methodology is preferred; and

(b) Having regard to your answer to the above question, and using your preferred methodology with respect to each EOT claim as identified in the reports prepared by James Lyall of HKA and dated 12 April 2018 and 4 May 2018, please apportion to each Separable Portion Probuild's reasonable and necessarily incurred direct on-Site time-related costs, including on-Site preliminaries costs.

192 By letter of instruction dated 13 December 2018, Cox was further instructed by Probuild's lawyers to prepare a report which replies to those aspects of Birchall's reports dated 21 September 2012 (Birchall First Report) and 5 October 2012 (Birchall Second Report) that he considered warranted a response or clarification. Birchall presented expert evidence for V601 in relation to quantum.

193 Cox and Birchall also produced joint reports entitled Quantum Experts' Joint Report 1 (5 February 2019) and Quantum Experts' Joint Report 2 (13 February 2019).

194 By an Order made in the proceeding on 23 October 2018, the parties' Programming Experts, with the assistance of a Facilitator (Dr Donald Charrett, an experienced Engineer and practising Barrister), prepared Joint Expert Reports summarising their respective expert opinions in relation to programming, delay, and time extension entitlement issues in this proceeding.

195 By an Order made in the proceeding on 23 October 2018, the parties' Quantum Experts, with the assistance of a Facilitator (Dr Donald Charrett), prepared Joint Expert Reports on quantum-related issues which summarised each Expert's respective views.

196 The Quantum Experts' Joint Report 1 (5 February 2019) does not consider the quantum of costs arising from any extensions of time determined by the Programming Experts. The Quantum Experts' Joint Report is therefore confined to those quantum issues that do not involve the valuation of any time extension costs.

197 By the Quantum Experts' Joint Report 2 (13 February 2019), Cox and Birchall report that they met in conference on 13 February 2019, chaired by the Facilitator, Dr Donald Charrett, and assessed the extension of time costs claimed by Probuild.

198 Two overarching general disputes between the parties may conveniently be determined before turning to a number of issues about the proper interpretation and application of the Contract (mainly in connection with the operation of the time extension provisions of the Contract); and then to V601's claim for liquidated damages and Probuild's claims for extensions of time, its related claims for delay costs, and the claims in relation to the façade Variation and the bonus that Probuild seeks for early completion.

199 Those two overarching general disputes arise in relation to:

(a) the attack by Probuild on the independence of the Project Manager, who was engaged by V601 and charged with both administrative obligations under the Contract, and to act as the independent assessor and certifier under the Contract including, in particular, in relation to the Contractor's extension of time claims under cl 34 of the Contract; and

(b) the dispute between the parties as to the requirements of cl 34 of the Contract, in particular cl 34.4(b)(ii), and as to which program and programming analysis is required or permissible to establish delay on the critical path in respect of a relevant delay.

The Project Manager's role and the question of independence

200 As the plaintiff in this proceeding, V601 seeks liquidated damages in the sum of $4,712,519. In this claim, V601 relies upon the Certificate issued by the Project Manager, Nave. V601's case is that the certified sum and Liquidated Damages is due and payable by Probuild under the Contract. Therefore V601's claim in relation to Liquidated Damages is in the nature of a claim for a debt arising on 18 December 2013, and created by Liquidated Damages Certificate 5.

201 V601 submits, as its primary submission in response to Probuild's case impugning the Project Manager's independence, that:[108]

The first is the issue of independence, which V601 says is irrelevant to these proceedings. As a matter of fact, V601 concedes that all of the Project Manager's determinations are the subject of a Notice of Dispute under clause 42.1 and, in accordance with clause 42.2, Probuild has now instituted Court proceedings to resolve those disputes.

202 V601 also submitted, in relation to the Project Manager's obligations under cl 20 and in response to Probuild's arguments seeking to impugn the Project Manager, that Probuild misunderstands the concept of 'independence' under the Contract. V601 contends that the Project Manager is not required to comply with the requirements relating to independence in cl 20.2 of the Contract in relation to extensions of time granted pursuant to cl 34.5(b), or in relation to all aspects of a Contractor's claim for Variation under the Contract.

(a) Probuild's case alleging that the Project Manager lacked independence only superficially deals with cls 20.2 and 34 of the Contract, and in doing so, misstates their effect. V601 also asserts that Probuild has ignored the provisions of cls 20(b)(ii) and 20.1 of the Contract in relation to the Project Manager;

(b) Probuild has failed to identify how the conduct asserted by Probuild has breached cls 20.2 and 34 of the Contract, and the Court cannot be confident as to how Probuild puts its case, especially when, as part of its case in relation to the Project Manager's independence, it reflects on the professional and personal integrity of Nave;[109]

(c) V601 adds that Probuild's submissions on the independence of the Project Manager have placed V601 in an impossible position, whereby V601 would have to analyse the Contract and discuss the alleged breaches of it, thus effectively placing a reverse onus on V601 by forcing it to defend a case which has not been put or articulated.[110]

204 V601 claims that, as a result of the above, it has elected to simply submit the effect of the Contract in relation to the Project Manager's role and not traverse the factual matters relied upon by Probuild, in Probuild's Indicia Schedule, as evidence impugning the Project Manager's lack of independence and breaches in that regard.[111]

V601's submissions in relation to the Project Manager's role

205 V601 submits that, pursuant to cl 20 of the Contract, the Project Manager has been charged with a dichotomous role, which V601 characterises as encompassing two 'identities'. V601 submits that one role and identity is as the principal's agent under cl 20.1 of the Contract, which relates to a range of administrative matters (Agents Functions).[112] The other role and identity is that of assessor and certifier under cl 20.2 of the Contract (Independent Functions).

206 V601 submits that Probuild's attack on the Project Manager's independence has failed to identify and maintain the distinction between the Project Manager's Agent Functions and its Independent Functions. Further, that Probuild has overstated and exaggerated the Independence Functions, and has applied the Project Manager's obligations in relation to its Independent Functions to all of the Project Manager's conduct;[113] thereby failing to appreciate the limited nature of the Project Manager's obligations under cl 20.2 of the Contract.

207 V601 submits that, pursuant to cl 20(a) of the Contract, in substance, the Project Manager is the Principal's agent in respect of every function to be undertaken by the Project Manager, except those Project Manager functions exhaustively listed in cl 20.2 of the Contract. Further, V601 submits that, as a result, the Project Manager's 'default' role under the Contract is to act as the Project Manager's agent.[114]

208 V601, however, accepts that in respect of the Project Manager's Agent Functions, it is obliged to ensure that the Project Manager acts honestly and within the contractual time limits; alternatively, within a reasonable time frame.[115]

209 V601 also submits, as a matter of contractual interpretation, that the Project Manager's Independent Functions are exhaustively listed in cl 20.2(a) of the Contract.[116]

210 V601 submits that the Project Manager is only required to comply with cl 20.2 in relation to the limited scope of the various Independent Functions. V601 also submits that the Project Manager is not required to comply with cl 20.2 (the Independent Functions) in every respect, in relation to Probuild's claims for extensions of time, delay damages, and variation claims under the Contract.[117]

Each of these specific functions utilises the wording of a particular provision in the Contract and, as such, can be traced to the performance of a function under that particular provision. Accordingly, a proper reading of the Contract demonstrates that the Independent Functions are limited in scope. The Project Manager is only required to comply with clause 20.2 in the context of these functions and not, as Probuild has submitted, in every respect relating to Probuild's claims for an EOT, delay damages and Variations.

212 V601 also submits that cl 20.2(b) of the Contract sets out the Project Manager's rights and obligations in relation to exercising each of the Independent Functions and:

(a) does not impose any unconstrained obligation upon the Project Manager to act 'independently', but only restricts the Project Manager's interaction with the parties;

(b) cl 20.2(b)(i) only restrains the Project Manager's interaction with the parties, thereby requiring the Project Manager to maintain independence from Probuild and V601, however;

(c) cl 20.2(b)(i) removes all constraints on the Project Manager's right to consult with the parties; and

(d) cl 20.2(b)(ii) removes any constraints on the Project Manager's right to consult with the parties.

213 V601 contends that the overall operation of cl 20.2, as outlined above, results in cl 20.2(b)(i) only requiring that the Project Manager maintain independence from V601 and Probuild, and that the effect of cl 20.2(b)(ii) is that the Project Manager is entitled to consult with either of the parties. Put another way, V601 submits that there is no basis upon which to conclude that cl 20.2 of the Contract prevents the Project Manager from consulting with third parties.

214 V601 also argues that cl 20.2(b)(ii) of the Contract places no restriction on the Project Manager's right to consult either Probuild or V601 and does not limit the extent of consultation with those parties. Therefore, V601 submits that the Contract permits the Project Manager to consult with only one of the parties to the Contract on a matter, or matters, and also submits that, by implication, the Project Manager is not obliged to consult equally with both parties.

V601's submissions on Probuild's entitlement to extensions of time

215 V601 submits that cl 34 of the Contract requires the Project Manager to adopt two different roles when considering Probuild's claims for extension of time. Those different roles relate to considerations as to whether Probuild has made its extension of time claim in accordance with cl 34.4(b) of the Contract (the claim requirement); and whether the delay has affected an activity which, in the opinion of the Project Manager, is on the Critical Path of the Approved Contractor Program as it existed at the time of delay (the critical path requirements), and whether Probuild has taken all reasonable measures to preclude and minimise delay (the mitigation requirement).[119]

216 V601 accepts that the Project Manager undertakes the above tasks pursuant to cls 20.2 and 34.4(b) of the Contract and, accordingly, in undertaking the tasks referred to in the preceding paragraph, the Project Manager is determining whether Probuild is 'entitled' to an extension of time. By undertaking these tasks, V601 appears to accept that the Project Manager's Independent Function obligations are applicable.[120]

217 V601 submits that once Probuild can establish (or fails to establish) an entitlement to an extension of time, the Project Manager has a separate function to discharge under cl 34.5; namely, under cl 34.5, in the assessment of whether Probuild is entitled to an extension of time under cl 34.4, the Project Manager may:

(a) assess the extent of the extension of time to which Probuild is entitled under cl 34.5(a) of the Contract; and

(b) in certain circumstances, the Project Manager may direct an appropriate extension of time under cl 34.5(b), even if Probuild has not claimed an extension of time, or has claimed an extension of time but not established that it is entitled to an extension of time.[121]

218 V601 also submits that in granting or directing an extension of time under cl 34.5, the Project Manager is not subject to cl 20.2 of the Contract.[122]

(a) '[the] [g]ranting or directing of an extension of time under clause 34.5 is not subject to clause 20.2. Probuild's case is fundamentally misconceived. What Nave in fact did, as the evidence reveals, was, finding himself in a position where he could not be satisfied that Probuild were entitled to an extension of time, because he had not been provided with the appropriate program (which is now admitted), Nave determined to exercise his sole and unfettered discretion to grant an extension of time. The exercise of that discretion was not subject to the clause 20.2'. V601 submits that the 'whole of Probuild's case on independence fails at that point'.[123]

(b) V601 submits, on the above basis, that the whole of Probuild's case has misunderstood what the Project Manager has done.

220 V601 submitted that the determination of 20 September 2012 was a direction, rather than an assessment and notification, and therefore did not therefore fall under cl 20.2 (independent functions of the Project Manager),[124] thus avoiding the requirement of independence and impartiality by the Project Manager.[125]

221 V601 earlier submitted that cl 20.2 'imposes the obligation of [the] independent function in relation to 20.2(a)(i), Entitlement to an EOT',[126] and reiterated its submissions on what it contends is the 'distinction [being] maintained throughout the document, between an assessment and an entitlement'.[127] V601 enlists that suggested distinction to support its thesis that cl 20.2(a)(i) relates to the exercise of determining an entitlement to an EOT, but does not inform the Project Manager's exercise of power under cl 34.5(b) of the Contract (including directing an EOT).[128]

222 Further, V601 submits that in assessing and certifying an entitlement to an EOT claim, the Project Manager is not constrained by cl 20.2, and therefore 'doesn't have to act independently in doing that'.[129] V601 accepted that it was 'not an immediately attractive submission' and dismissed the notion of an implied term, stating:

If you say there's an implied term, no place to imply a term here. As a matter of construction, well, shall we do violence to the language by saying, 'Well, entitled means what we actually - it means assessment as well'.[130]

223 On the basis of V601's above interpretation of the Contract, V601 asserts that the Project Manager, in determining whether Probuild is entitled to an extension of time, can:

(a) under cls 20.2(b)(ii) and 34.4(b)(i), may consult with either or both of the parties (and is not precluded from consulting with anyone else) in relation to whether Probuild's claim has been made in accordance with the requirements of cl 34.3;

(b) the parties must be taken to have agreed that the Project Manager is entitled to obtain third party advice as to the operation of the express provisions of the Contract.

V601 points out that there may be grave consequences for either party if the Project Manager misinterprets the Contract. V601 submits that cl 20.2 does not constrain the Project Manager's ability to obtain advice from appropriate third parties, including suitably skilled lawyers;

(c) by virtue of cls 20.2(b)(ii), 34.4(b)(i), and 34.4(b)(ii), the Project Manager is entitled to consult with either or both of the parties (and is not precluded from consulting with anyone else), in relation to whether Probuild's claim complies with cl 34.3 of the Contract, and as to whether the activity which Probuild claims was delayed was on the critical path of the Approved Contractor's Program. V601 submits in the subject circumstances that it was reasonable for the Project Manager to consult with TBH where 'Probuild failed or refused to provide a program that complied with cl 32 to support its claims'.[131]

Further, the Project Manager was entitled to rely on TBH, and to give input or material from TBH such weight as he considered appropriate.

224 V601 ultimately contends that the Project Manager acted independently and honestly, and otherwise in accord with the requirements of the Contract, and further that the Project Manager's Certificates, in particular Certificate 5 in relation to Liquidated Damages is valid and enforceable.

Probuild's submissions on the Project Manager's lack of independence

225 Probuild submits that the Project Manager's independence was compromised prior, and in relation to the issue of Certificate 5; and as a consequence, the Project Manager's Certificates, including Liquidated Damages Certificate 5, are void and should be set aside.

226 Probuild also contends that Certificate 5, which was issued by the Project Manager to certify the Liquidated Damages claimed by V601, is, in any event, erroneous because it does not take into account Probuild's entitlements to extensions of time under the Contract.

227 Further, Probuild impugns the Project Manager's conduct in relation to the role it undertook, in assessing and determining Probuild's entitlement under the Contract, and in particular Probuild's entitlements to extensions of time and associated delay costs.

228 Probuild submits that it is well recognised that a certifier's determination may be ignored if the person purporting to certify fails to conduct themselves in accordance with the empowering contract, or fails to conduct themselves to the required standard. This may occur:

(i) where the decision-maker has a special interest in the result;

(iii) in the case of improper pressure, influence or interference by a principal;

(iv) where the principal's breach of contract, or other act or omission, prevents the contractor from obtaining a decision;

(v) where the decision-maker unreasonably refuses to consider the matter; and

(vi) where the decision-maker takes improper considerations into account.

Probuild submits that the above circumstances, which are not exhaustive, also include the decision-maker's conduct in failing to satisfy the proper standard of fairness, independence and impartiality.[132]

229 Probuild submits that there may be a relevant interference with a superintendent's independence 'where there is an attempt to lead the superintendent astray in the interests of the principal', or where there are communications between the principal and superintendent 'of an improper character'.[133]

230 Probuild also submits that the Project Manager is in breach of its cl 20.2 duties if it communicates unilaterally with the principal on matters antithetical to the Contractor's entitlements under the Contract, in respect of which the Project Manager is required to act as certifier.

Probuild's submissions in relation to cls 20.1 and 20.2 of the Contract

The Project Manager's relevant duties and obligations

231 Although set out earlier, it is convenient to again refer to cl 20 of the Contract, which provides:

20 Project Manager

20.1 Agent functions

(a) The Principal shall ensure that at all times there is a Project Manager.

(b) The Principal has appointed the Project Manager as its agent under the Contract in relation to the following functions and any other function which the Principal notifies the Contractor of in writing from time to time but in each case, in advance of the exercise of such function by the Project Manager:

(i) assessing the value of work;

(ii) certification of moneys due and owing as between the Contractor and Principal by way of the issue of a Payment Schedule under clause 37.2 or a Final Certificate under clause 37.4;

(iii) directing Variations under clause 36.1; and

(iv) any determination required as to the quality of any work.

(c) The Principal shall ensure that in the exercise of the Project Manager's functions as the Principal's agent under the Contract, the Project Manager:

(i) acts honestly; and

(ii) acts within the time prescribed under the Contract or where no time is prescribed, within a reasonable time,

but is not, as the Principal's agent, required to act independently or impartially.

232 Further, the provision concerning independent functions at cl 20.2 of the Contract, provides:

20.2 Independent functions

(a) In addition to the Project Manager's functions as the Principal's agent as set out in clause 20.1, the Project Manager shall also act as assessor and certifier in respect of:

(i) whether the Contractor is entitled to an EOT;

(ii) whether the Contractor has achieved Practical Completion;

(iii) whether the Contractor is entitled to delay damages pursuant to clause 34.9; and

(iv) in the assessment of the price of a Variation in accordance with clause 36.4.

(b) In relation to the four functions described in clause 20.2(a):

(i) the Project Manager shall act independently of the parties and neither party shall be entitled to give Directions to the Project Manager;

(ii) the Project Manager is entitled to consult with either one of or both parties but is not obliged to consult with both parties; and

(iii) the Project Manager shall act reasonably in exercising the identified functions and shall have regard to the express requirements of the Contract and not the commercial interests of either party.

233 Probuild submits, contrary to V601's submission, that the Contract does not distinguish between 'entitlement' and 'assessment', particularly in relation to the operation of cls 20.1, 20.2 and 34.4 of the Contract.[134]

234 Probuild submits that cl 20.2(a) provides that the Project Manager shall act as assessor and certifier for various functions, including whether the Contractor is entitled to an extension of time and whether, consequentially, the Contractor is entitled to delay damages under cl 34.9 of the Contract. Further, Probuild observes that the terms of cl 20.2(a)(i) do not limit the Project Manager's assessments to those necessary to address the Contractor's cl 34.4 entitlements.[135]

235 Probuild submits that the Contract recognises the functions of the Project Manager in respect of which it is required to act independently, including by the language employed in cls 20.2 and 34.4. Probuild contends that the Project Manager's independent functions include those in relation to which the Project Manager both assesses and certifies the Contractor's claims.

236 In relation to V601's submissions concerning the operation of cl 20.2(b), and the Project Manager's entitlement to consult with the Contractor, the Principal, and third parties, Probuild submits that:[136]

30. V601 contends at [32] that clause 20.2(b)(ii) provides the Project Manager with an unfettered right to consult:

Clause 20.2(b)(ii) does not place any limitations on the Project Manager's right to consult with either party. There is no limit to the extent of such consultation. There is no limit to the subject-matter of such consultation.

31. This interpretation obviously seeks to excuse the extensive collusion between V601, its solicitors, TBH and the Project Manager when determining Probuild's EOT2A and 3 claims, the Façade Variation and the certification of Practical Completion.

32. It is flawed because it seeks to apply clause 20.2(b)(ii) out of context and in isolation. The Project Manager's entitlement to consult is one integer of clause 20.2(b). The other two integers are: (i) the independence requirement; and (ii) that the Project Manager act reasonably in exercising the functions listed in clause 20.2(a) having regard to the express requirements of the Contract, and not the parties' commercial interests. These integers are cumulative. This is indicated by the word 'and' at the end of clause 20.2(b)(ii).

33. Accordingly, when these integers are read together, the proper construction of clause 20.2(b)(ii) does not permit the Project Manager to conduct consultations in a partisan way when performing its 'Independent Functions'. While the Project Manager's consultations need not be with both parties, if appropriate, the consultations cannot be for the purpose of devising and advancing V601's commercial strategy to answer Probuild's claim, or to advance V601's commercial interests. Instead, the consultations permitted are those required for the proper determination of Probuild's claims.

34. V601's reliance on clause 20.2(b)(ii) to excuse its collusion with the Project Manager is therefore misconceived. It has created for itself the metaphysical challenge of explaining how the Project Manager may conduct 'consultations' regarding a particular claim in a partisan manner while simultaneously acting independently.

Considerations/conclusions regarding the Project Manager

General observations - role of the superintendent

237 In general, the role of the superintendent in relation to an engineering and/or construction contract is to administer the contract and to ensure contractual obligations are performed. The superintendent's role is defined by the relevant terms of the contract and the common law.

238 The superintendent commonly fulfils two separate and distinct roles, namely:

(a) to act as an agent for the principal; and

(b) to act as an independent assessor and certifier.[137]

239 In the superintendent's role as agent of the principal, the superintendent acts in the principal's best interests and pursuant to the superintendent's obligations to the principal, subject to the obligations of both the principal and the superintendent under the relevant engineering and/or construction contract and in law.

240 However, in the role of assessor and certifier, the superintendent must ordinarily act independently, and in an impartial and fair manner, and must not act in a way that advances the principal's interests over those of the contractor.

241 The faithful performance of these two roles may give rise to tension.[138]

242 The specific term of the contract applicable to the superintendent's duties and obligations in respect of the contractor, and the work to be carried out under the contract, will usually largely define the superintendent's roles and define or materially inform the superintendent's obligations and duties when acting as an assessor and certifier.

243 Normally, the powers conferred on the certifier by a clause empowering the principal to administer the contract are exercisable in the performance of a merely administrative function, and the contractor will, in such a case, ordinarily not have the right to be heard.[139]

244 However, the contractor may have the right to be heard when the superintendent is determining the contractor's entitlements, although it is not clear that the duty to act fairly and impartially generally extends that far.[140] The answer will turn on the role of the certifier and on the proper construction of the relevant contract. It may be the case that, on the proper construction of the contract, the rights of the contractor have not been infringed by a refusal to entertain a party's submission in relation to an entitlement under the contract which is the subject of certification.[141]

245 In 500 Burwood Highway Pty Ltd v Australian Unity,[142] Vickery J held that a 'certifying expert' (in that case, a quantity surveyor, and in a position analogous to a superintendent) is under no obligation, when certifying, to provide procedural fairness or natural justice in the absence of an express contractual provision, subject always to the applicable agreement between the parties.

246 In the instant matter, the terms of cl 20.2(b)(ii) of the Contract provide that, in respect of matters where the Project Manager is required to act as assessor and certifier, the Project Manager is entitled to consult with the parties but is not obligated to do so. This, in my view, implies that the Project Manager may refuse either parties' representations in relation to any entitlement which the Project Manager is assessing for the purpose of certification. This provision of the Contract, in my view, taking into account the relevant contractual context, which includes that the Project Manager is obliged to act independently, impartially, reasonably, and fairly, and in accord with the terms of the Contract, implies transparency in relation to any representations considered by the Project Manager, and provided by the Contractor or the Principal in support of the position that each may contend for in relation to a right or entitlement under or in relation to the Contract.

247 Further, ordinarily, a superintendent exercising the powers of an assessor and certifier continues to owe both contractual and tortious duties to the principal. In Dymocks Book Arcade Pty Ltd v Capral Ltd,[143] McDougall J saw nothing in recent decisions 'to subvert the proposition that a common law duty of care may exist alongside contractual duties'.

248 Here, however, Probuild and V601 do not raise any issue of tortious duty in respect of the Project Manager's conduct.

249 Further, a principal may be in breach of the contract with the contractor in circumstances where the principal has failed to discharge its contractual obligation to ensure that the superintendent has properly discharged its functions under the construction contract. The principal may also be liable in relation to the negligence of the superintendent, in certain circumstances.[144]

250 It is also trite that an assessor and certifier in the nature of a superintendent may also lose independence without actually intending to do so, or even without an understanding of having done so.[145]

251 Absent some contrary contractual provision,[146] ordinarily the certifier appointed under a construction or engineering contract, in making a determination in relation to a claimant party's entitlements is not acting as an arbitrator, or as agent for the parties, notwithstanding that the function of a certifier has sometimes been described as that of a quasi-arbitrator or even as that of an arbitrator.[147] However, such a determination must be made fairly,[148] impartially,[149] and independently.[150]

252 A certificate is normally in writing, but this is not an essential requirement at law unless the building contract specifies otherwise.[151] Whether a certificate is formally effective will depend upon its proper construction in light of any contractual obligations as to its issue and its form.[152] The function of the subject certificate in the administration of the project may also depend on the adroitness of the certifier.

253 If the certifier is not independent, the certifier may be disqualified from providing the certificate, and certificates already issued may be set aside.[153] A certificate which is produced by fraud,[154] or by improper collusion between the certifier and a party,[155] is vitiated and of no effect.[156]

254 In John Holland Construction & Engineering Pty Ltd v Majorca Projects Pty Ltd & Anor (Majorca),[157] Byrne J held, in summary, that duty of care can exist between a superintendent and a contractor, if it can be established that the contractor relied and depended upon the careful and impartial performance of the superintendent's obligations. However, given the facts and circumstances of that case, no relevant duty of care arose.

255 Further, ordinarily, the duties of the certifier in relation to independence, impartiality, and fairness override any agency obligations that the superintendent owes the principal. Accordingly, the principal cannot direct the superintendent as to how to act as assessor and certifier. In the instant Contract, this position is expressly confirmed by the term of cl 20.2, including cl 20.2(b)(i).

256 In Perini Corporation v Commonwealth of Australia (Perini),[158] the superintendent was the director of works and was also in substance acting as certifier. The superintendent rejected extension of time applications in respect of wet weather. The superintendent's reasoning for these rejections turned on the departmental policies of the principal. The contractor argued that this conduct on the part of the superintendent was a breach of the superintendent's role as certifier and sued for damages.

257 The Court held in Perini that when the superintendent is acting in the capacity of certifier, the superintendent must ensure that it acts independently and, at all material times, exercises its own discretion.[159] The superintendent should, however, bear in mind the policies of the principal, although it would be wrong for the superintendent to regard itself as being bound by those policies.

258 The Court also held that there was an implied term that the principal would not interfere with the superintendent's duties as certifier and, additionally, that the principal was obliged to ensure the superintendent properly performed its duty as certifier.[160]

259 In Kane Constructions Pty Ltd v Sopov,[161] Warren CJ stated in relation to indicia impugning the conduct of the Superintendent that: [162]

These include when the superintendent allows their judgment to be influenced; when the superintendent is in a position whereby the certificate is deprived of value; when the superintendent acts in the interests of one of the parties and by their direction; when the position is misconceived and the superintendent acts as mediator; when there is not sufficient firmness in order to decide questions based on his or her own opinion; where judgement and conduct are controlled by the principal; and where the superintendent considers the assent of the principal to be necessary, has ceased to be a free agent and does not give full disclosure of every communication between the superintendent and the principal.

260 In Baulderstone Hornibrook Pty Ltd v Qantas Airways Ltd (Baulderstone),[163] Finkelstein J stated in relation to the potential vulnerability of a certifier in this context:

The route by which BHPL seeks to attack Cliftons' decision is indirect. I mean by this that BHPL does not, as it might have done, plead that the decisions in question should be disregarded on account of some vitiating factor. The cases establish that a person in the position of Cliftons (or Mr Crawford) exercising power under a contract to decide extensions of time and determine compensation claims must act honestly and fairly and if he does not his certificate can be ignored. Hickman & Co v Roberts [1913] AC 229 is a leading example of this type of case. The circumstances in which a certificate will be vitiated cannot be exhaustively stated. The most recent edition of Hudson's Building and Engineering Contracts, 11th ed 1995 by I N Duncan Wallace, suggests the following broad categories: (1) where the decision-maker has a special interest in the result; (2) fraud or collusive conduct; (3) improper pressure, influence or interference by the owner; (4) conduct which falls short of the proper standard of fairness, independence and impartiality; (5) breach of contract or other act or omission of the owner having the effect of preventing the builder obtaining a decision; (6) unreasonable refusal by the decision-maker to consider the matter; and (7) taking improper considerations into account.

261 In Kell & Rigby Holdings Pty Ltd v Lindsay Bennelong Developments Pty Ltd (Kell & Rigby Holdings),[164] Hammerschlag J also stated:

Clause 23.1(a) provides that the Principal shall ensure that at all times there is a Superintendent and that in the exercise of the functions of the Superintendent under the Contract, the Superintendent acts honestly and fairly. In the present case the Principal and the Superintendent are one and the same person. Thus, it was incumbent on the defendant to act fairly. Clause 23.1(a) is an express imposition of a duty which would anyway ordinarily be imposed on a person in the position of Superintendent: Perini Corporation v Commonwealth [1969] 2 NSWR 530.

If a person in a position of the Superintendent does not act honestly and fairly, his certificate can be ignored: Baulderstone Hornibrook Pty Ltd v Qantas Airways Ltd [2003] FCA 174 at [89]; Hickman & Co v Roberts [1913] AC 229.

262 As earlier outlined, in Perini,[165] Macfarlan J held that a certifier must make a determination fairly and that a certificate produced by improper collusion between the certifier and a party may be deemed ineffective.

263 Furthermore, in Peninsula Balmain Pty Ltd v Abigroup Contractors Pty Ltd (Peninsula Balmain),[166] the Court considered arguments in respect of the superintendent's role as an agent of the owner. Hodgson JA (with whom Mason P and Stein JA agreed) considered that the decision in Perini supported the view that a superintendent is the owner's agent in all matters, but only in a 'very loose' sense; and that, when a superintendent exercises certifying functions in respect of which it must act honestly and impartially, the superintendent is not acting as the owner's agent 'in the strict legal sense'.[167]

264 Here, pursuant to cl 20.2 of the Contract between V601 and Probuild, the general proposition referred to above in Peninsula Balmain is cast in clear express contractual terms and is beyond doubt.

265 Pursuant to the Contract, the Project Manager's functions are, I consider, consistent with those typically performed by superintendents. Clauses 20.2 and 34 recognised that the Project Manager is the assessor and certifier of Probuild's claims for extensions of time, delay damages, and valuing variations, and in relation to assessing whether Practical Completion was achieved.

266 Expressly, cl 20.2 of the Contract requires that, when performing the four functions of assessing and certifying the Contractor's:

(a) time extension entitlements;

(b) achievement of Practical Completion;

(c) entitlement to delay damages pursuant to cl 34.9 of the Contract;

(d) variation payment in accordance with cl 36.4 of the Contract,

(e) act independently of the parties and not be the subject of any direction from a party;

(f) act reasonably;

(g) have regard to the express requirements of the Contract; and

(h) not act in the commercial interests of either party.

267 In my view, absent the above express terms, when performing a relevant assessment and certification, the above requirements referred to in cl 20.2 of the subject Contract at (e) to (h) above are imposed. I also observe that, in substance, the same four terms would ordinarily be imposed at law.[168]

268 Further, I observe that the terms of the Project Management Agreement between V601 and the Project Manager, First Urban, do not alter the above position, including because Probuild was not a party to the Project Management Agreement.[169]

269 Accordingly, by force of cl 20.2(b), neither of V601 or Probuild was permitted to give the Project Manager directions, and the Project Manager was required to act reasonably in exercising those functions and to have regard to the Contract's express requirements, and not either party's commercial interests. I note that Probuild's Notice of Dispute dated 16 October 2012[170] raised issues in this regard.[171]

270 Pursuant to cls 20.2(b)(ii) and 34.4(b)(iii), the Project Manager is also entitled to consult with the parties and third parties, in relation to whether it took all reasonable measures to prevent the occurrence of the Qualifying Cause of Delay and to minimise delay.

271 V601 has framed its positive and defensive cases on the basis that the Project Manager correctly assessed both Probuild's time extension entitlements and V601's entitlement to liquidated damages.

272 In his witness statement, Nave appears to contend that his assessments were both correct and undertaken independently.[172] This is disputed by Probuild.

273 However, Nave also acknowledges that he had neither the qualifications nor the expertise to make the relevant assessments in the circumstances which pertained:[173]

Because I hadn't been provided with appropriate programming information by Probuild, and I am not qualified as a programmer, I sought the support of an expert programing consultant to assist with the preparation of a program against which I could make a properly informed assessment of EOT 2A and EOT 3. To this end I engaged Tracey Brunstrom & Hammond (TBH) on behalf of V601 on 13 April 2012. TBH are a project and strategic management services company that specialises in project planning and programing for construction projects.

274 Notwithstanding the above, V601 contends that Nave properly assessed Probuild's entitlements.

275 However, each of the Project Manager's certificates and assessments is disputed under the Contract and V601 concedes that the Court is empowered and able to determine Probuild's earlier determined entitlements under the Contract, on the merits.

Considerations in relation to the requirements and scope of the Project Manager's duties and obligations of independence under the Contract

Proper construction of cl 20.2 of the Contract

276 Clause 20.2 of the Contract expressly provides that, when fulfilling the roles of assessor and certifier, the Project Manager must act independently of the parties and reasonably, and have regard to the express requirements of the Contract, and not the commercial interests of either party.

277 The roles of assessor and certifier apply in particular when the Project Manager is assessing and certifying the Contractor's extension of time and delay damages entitlements, and when the Project Manager is determining the Contractor's achievement of Practical Completion and the price that the Proprietor is obliged to pay for Variations to the scope of the WUC.

278 In my view, the parties' express requirement that the Project Manager act independently and reasonably, including in its role as assessor and certifier of the Contractor's entitlements to extensions of time and delay damages, carries with it a requirement that the Project Manager act fairly and impartially in respect of such assessments and certifications, and in deciding whether the Contractor has achieved Practical Completion, as well as in determining the pricing of Variations.

279 The purpose of cl 20.2 is obvious. It is to charge the Project Manager with the obligations of an independent decision maker in respect of the matters referred to in cl 20.2(a), and also to bind the Proprietor in relation to the requirements imposed on its appointee, the Project Manager, by cl 20.2.

280 It follows that a purposive construction of the Project Manager's obligation of independence includes an obligation to act impartially and similarly, and the obligation to act reasonably which, I consider, includes an obligation to act fairly.

281 Given the general manner in which the matters to be decided by the Project Manager are described in cl 20.2 of the Contract, and the protective nature of those stipulations, I am also of the view that cl 20.2 should be construed in a broad and facilitative way, consistent with the objective and purpose of the clause referred to above.

282 For the above reasons, I reject V601's contention that the application of cl 20.2 should be limited to only one part of the Project Manager's consideration of Probuild's EOT claims[174] and, subject only to the qualification referred to below in relation to the operation of cl 34.5(b) of the Contract, I also reject V601's submission that cl 20.2 is of limited scope in relation to the Project Manager's assessment and certification of Probuild's delay damages claims.

283 However, in John Holland Construction & Engineering Pty Ltd v Majorca Projects Pty Ltd (Majorca),[175] it is clear from the reasons that the certifying architect consulted with his own lawyer in respect of the preparation of a certificate, the provisional assessment of damages which accompanied it,[176] and whether an assessment for the certificate should be made using working days or calendar days.[177] Justice Byrne did not impugn or criticise access to, and input from, a party's lawyer in relation to such matters.

284 His Honour separately noted that the builder did not suggest that the architect was or should have been disqualified on the ground of loss of independence, but argued only that there was a breach of the duty of care to act impartially, resulting in loss.[178] It was relevant, in his Honour's view, that many of the functions of the architect required communication and consultation between the architect and the proprietor, often of a confidential nature, and that communications between an architect and the proprietor regarding payments to the builder, which were properly in furtherance of the objective of reaching a compromise, could not be impugned.[179]

285 Citing Nelson Carlton Construction Co v AC Hatrick (NZ) Ltd,[180] Byrne J concluded that the relevant test was whether the architect (or certifier) had heard 'representations which are of such a nature as to be calculated to influence him in arriving at his determination'. If this was so, then the other party must be afforded the opportunity of answering those communications to the architect.[181] After examining each of the impugned communications, Byrne J concluded there was no material representation which the architect sought or received that ought to have been submitted to the builder.[182]

286 In Kell & Rigby Holdings,[183] a superintendent was held not to have acted fairly where, inter alia, he had acted on the instructions of a director of the principal without having discussed the matter with the builder beforehand.[184]

287 Here the express terms of cl 20.2(a) impose relevant obligations on the Project Manager, when acting as assessor and certifier. Both the express language and the scheme of the Contract expressly provide for the Project Manager to act as 'assessor and certifier' in respect of a number of functions. These include evaluating whether the Contractor is entitled to extensions of time, whether the Contractor has achieved Practical Completion, is entitled to delay damages, and what the Contractor is entitled to be paid for a Variation in accordance with cls 34.9 and 36.4 of the Contract.

288 The phrase, 'the Project Manager shall also act as assessor and certifier in respect of' the four functions specified in cl 20.2(a)(i) to (iv), makes it clear that the process of assessing and certifying the Contractor's entitlement to extensions of time, achievement of Practical Completion and delay damages, and the price of Variations involves the dual steps of assessment and certification by the Project Manager.[185]

289 Accordingly, it is clear, in my view, that the Contract requires the Project Manager to independently both assess and determine Contractor entitlements under the terms of cls 34.4 and 34.5(a) of the Contract, and, if necessary, Probuild's entitlement to compensation for delay, pursuant to cl 34.9 of the Contract. The Project Manager is also to independently assess and determine the appropriate price of a Variation and the achievement of Practical Completion.

290 In respect of the Project Manager's independent functions, V601 emphasised the Contract's use of the word 'entitled' in cl 20.2(a), in relation to EOTs (cl 20.2(a)(i)) and delay damages (cl 20.2(a)(iii)).[186] V601 contrasts this with the use of 'assessment' in relation to the price of a variation (cl 20.2(a)(vi)).[187] Counsel for V601 observed that, 'if one searches the document you'll see that that distinction is throughout the contract; the difference between entitlement and assessment'.[188]

291 Using the contractual language, V601 then acknowledges that the Project Manager 'shall act independently of the parties, and neither party shall be entitled to give directions to the project manager', which it submits 'means that you're not entitled to give a direction to the project manager, relevantly, determining whether or not that contractor's entitled to an EOT'.[189]

292 However, V601 submits that the Contract permits consultation with 'either one of or both parties' (cl 20.2(b)(ii)), in relation to which V601 submits:

But consult, we say, means exactly what it is. You can consult in determining, as an assessor and certifier, in that function. You can consult with the parties, which, in this case, is V601. Of course you have to consult honestly and reasonably and impartially. We don't say you're allowed to go in there under consult provision and do things which would undermine your independent function, and we've never put that.[190]

293 Rather, V601 submits that 'consult' 'has to be addressed as a matter of construction of the contract', with 'textual analysis to assist' the Court, which it says Probuild has not done.[191] V601 highlights the content of cl 20.2(b)(iii), which provides that the Project Manager 'shall act reasonably in exercising the identified functions and shall have regard to the express requirements of the Contract and not the commercial interests of either party'.[192]

294 On the evidence, V601 also submits that 'no regard was had to the commercial interests of V601 by Mr Nave at all'.[193]

295 I depart from V601's case to also note that Probuild objected to receiving draft assessments of its extension of time claims from the Project Manager. Amongst other things, Probuild pointed out that such 'assessments' had no contractual basis, and challenged the propriety and contractual basis for the Project Manager sending a draft unsigned letter to the principal and including that unsigned letter in its response to the Contractor.[194]

296 I consider, however, for the reasons outlined elsewhere that V601, and its agent, the Project Manager, breached their obligations in relation to the proper administration of the Contract time extension assessment and determination process; and in addition were in breach by failing to award Probuild the extension of time to which it was entitled, in respect of Probuild's EOT2A and 3 claims, and also Probuild's EOT6 and EOT7 claims.

297 I accept where bona fide the Project Manager exercises its discretionary power to extend contractual time, pursuant to cl 34.5(b) of the Contract; a power, I observe, which is probably intended by the parties to avoid circumstances arising that set the Contract's time for performance at large. The exercise of that power and associated discretion are not subject to the requirement of cl 20.2 of the Contract. This is because cl 34.5(b) is not predicated on the Project Manager ascertaining that the Contractor is entitled to an extension of time.

298 Accordingly, I accept that cl 34.5(b) of the Contract expressly does not operate in relation to the Contractor's entitlement to an extension of time, but rather the language of cl 34.5(b) distinguishes between the Project Manager's obligations and duties when the Project Manager is assessing and considering certifying certain defined Contractor entitlements under cl 34.5(b), and when the Project Manager exercises its sole and unfettered discretion in relation to directing an extension of time, notwithstanding that the Contractor is not entitled to an extension of time or has not claimed an extension of time.

299 By using express language to convey that cl 20.2 operates in relation to assessing and certifying the Contractor's entitlements, and by separately providing that cl 34.5(b) operates when the Contractor is not entitled to an extension of time, it is, I consider, clear that the parties did not intend that the Project Manager's obligations and duties imposed by cl 20.2, in relation to its independent functions, should apply to the exercise of the Project Manager's sole and unfettered discretion under cl 34.5(b) of the Contract.

300 However, in my view, it is quite clear that the Contract time extension regime, on its express terms, requires the Project Manager to address, assess and determine the Contractor's claims for extension of time in accordance with the terms of cls 34.3, 34.4, and 34.5(a).

301 It is equally clear, in my view, for the same reason, that the Project Manager, and the Principal in league with the Project Manager, cannot purport to direct an extension of time under cl 34.5(b) in response to a time extension claim by the Contractor, rather than cls 34.3, 34.4, and 34.5(a), by a process which, in breach of the Contract, prevents the Contractor from making a time extension claim that is fully compliant with cl 34 of the Contract, because the Contractor cannot support its claim by reference to an applicable approved Contractor's program, as the Project Manager has failed or refused to approve the Probuild Contractor's Program submitted for approval under cl 32 of the Contract.

302 Here, in my view, egregiously, the Project Manager - and I infer, for reasons elsewhere expounded in relation to the lack of independence of the Project Manager, the Project Manager in concert with V601 - without contractual or factual or any other proper justification, as addressed elsewhere, failed or refused to approve Probuild's Contractor's program as it was obliged to and should have done pursuant to cl 32.3 of the Contract.[195]

303 In the result, in my view, the Project Manager's purported direction under cl 34.5(b) of the Contract, in relation to Probuild's EOT2A and 3 claims, was ill-founded and also void by reason of the Project Manager's lack of independence and its breaches of cl 20.2 of the Contract.

Probuild's alleged failure to provide Contractor's Programs

304 V601 asserts that the Project Manager was not able to assess Probuild's extension of time claims as the Contract required, because Probuild failed or refused to provide programs which the Project Manager was able to approve and therefore the required assessment of Probuild's extension of time claims could not be undertaken pursuant to cl 34 in relation to Approved Contractor's Programs; and as a result, the Project Manager directed the extensions of time at issue in these proceedings pursuant to cl 34.5(b) of the Contract, and therefore was not obligated to act independently and as stipulated by cl 20.2, when it directed such extensions of time.

305 I consider that Probuild's case (including as detailed in Annexure 2 to its 11 June 2019 Closing Submissions) remains pertinent, well directed and persuasive. In my view, the Project Manager's compliance with cl 20.2, and more generally whether the Project Manager has failed to act as required at law as assessor and certifier of Probuild's entitlements, directly impacts the validity of both the Project Manager's certification of Liquidated Damages, which V601 seeks to recover as a debt, and also directly impacts both the Project Manager's certifications in relation to Probuild's relevant claims for an extension of time, and the Project Manager's evidence more generally.

306 This is because, amongst other related matters to do with Probuild's extension of time claims, I reject V601's assertion that Probuild's time extension claims could not be assessed and certified as intended under cl 34 of the Contract, because Probuild had failed or neglected to provide V601 with Approved Contractor's Programs. I am satisfied, as explained elsewhere, that in substance, and in a manner which was as contractually compliant as it could be, given V601 and the Project Manager's acts of prevention in relation to approval of the Approved Contractor's Programs, Probuild submitted updated Contractor's Programs for the Project Manager's approval. I am also satisfied that, without justification, V601, by its agent the Project Manager, repeatedly refused or neglected to approve the Probuild Contractor's Programs and did so without proper justification.[196]

307 In the result, I find that although it could and should have done so, the Project Manager failed or refused to assess the Probuild extension of time claims as required under cl 34 of the Contract.

308 I also find that, in breach of cl 32 of the Contract, V601, by its Project Manager, prevented the approval of appropriately updated Approved Contractor's Programs and thereby prevented Probuild from relying on a program that had been approved by the Project Manager, as contemplated by cls 32.3 and 34.4(b)(ii) of the Contract.

309 I consider that, properly construed, affording primacy to the ordinary meaning of the words used in the clause, when considered together with their purpose and context, in particular in conjunction with cls 20.2(b)(i) and 20.2(b)(iii), cl 20(b)(ii) reflects the parties' intent that the Project Manager's entitlement to consult relates principally to the one practical element dealt with in cl 20.2(b); namely, the scope the Contract provides for the Project Manager to 'consult' with one or both of the parties to the Contract, but only in a way informed by the context, which expressly requires by cl 20.2(b) that the Project Manager must act independently.

310 Considering the practical application of cl 20, and for the avoidance of doubt, the words employed in cl 20.2(b) do no more than clarify that the Project Manager may, in relation to the four functions specified in cl 20.2(a), consult with either party and is not obliged to consult with both parties.

311 Clause 20.2(b) also expressly provides for several obligations relating to the independence of the Project Manager.

312 The duties, obligations, and limitations which cl 20.2 imposes on the Project Manager are, I consider, cumulative. This construction is strongly supported by the parties' inclusion of the word 'and' at the end of cl 20.2(b)(ii). Interpreted cumulatively, I consider that the parties to the Contract sought to broadly define how the Project Manager should conduct its Independent Functions when assessing and certifying certain of the Contractor's entitlements.

313 Clause 20.2(b) obliges the Project Manager to act independently of the parties to the Contract, and reasonably, having regard to the express requirements of the Contract and without regard to the commercial interests of either party.

314 In my view, by clear implication, the combination of these cl 20.2(b) obligations also extends to obligations on the part of the Project Manager to act impartially, honestly and fairly.

315 In my view, it follows from the above express and implied obligations under cl 20.2(b), that the parties did not intend by cl 20.2(b)(ii) to permit the Project Manager to consult in a way that was unfair, impartial, or lacking in independence, or in any way that assisted the commercial interests of one party.

316 Accordingly, in my view, cl 20.2(b) of the Contract does not permit the Project Manager to participate in Consultations with either or both of the parties to the Contract, which are of a partisan nature, or in consultations for, or including, the purpose of supporting or accepting or impeding or defeating any claim, or defence to a claim under or in respect of the Contract.

317 Further, I consider that it is readily to be implied that the latitude extended to the Project Manager to consult separately with the parties to the Contract, and with third parties, was intended by the parties to the Contract to be subject to, and limited by, the Project Manager's separate and cumulative independence obligations under cl 20.2. Further, any consultation with either party to the Contract, or a third party (for example, a consultant to the Principal), which breached or conflicted with the Project Manager's obligations of independence as assessor and certifier under the Contract, referred to in the last preceding paragraph, would be in breach of the Project Manager's obligation to act independently, impartially, fairly, honestly, reasonably and in accordance with the requirements of the Contract. To the extent that the Principal procured, encouraged or collaborated with the Project Manager in respect of conduct in breach of cl 20.2 of the Contract, it goes without requiring further elaboration, that the Principal would breach its obligations by so acting.

318 Accordingly, the nature and scope of consultation permitted by cl 20.2(b)(ii) renders it impermissible, and in breach of the Contract, for the Project Manager to consult in any way which was to the prejudice or disadvantage of either party to the Contract. I consider that this includes a party's entitlements and potential entitlements under or in respect of the Contract; or so as to advantage a party to the Contract vis à vis the other party in respect of its contractual entitlements or potential entitlements; or to assist one party or disadvantage either party to the Contract, commercially or tactically, in relation to rights and entitlements; or in respect of either parties' general commercial or practical position under or in respect of the Contract.

319 I find for reasons I have outlined below that, in substance, the meetings between the Project Manager and V601, and TBH, in relation to extensions of time and delay damages, were meetings and communications primarily focused on the Project Manager and V601 co-ordinating efforts to develop and implement a strategy and tactics to defeat and/or delay, and to minimise, any assessment and certification of Probuild's time extension and delay damages entitlements.

320 For these reasons, I also hold that such meetings and communications between the Project Manager and V601, and the Project Manager and TBH, were in breach of the Project Manager's obligations and duties under cl 20.2 and at common law; namely, the Project Manager's obligations and duties to discharge its independent functions independently, impartially, reasonably, fairly and in accordance with the requirement of the Contract and not to have regard to V601's commercial interests.

321 Further, I consider that V601 and the Project Manager breached cl 20.2 of the Contract by consulting and meeting for the purpose of devising and advancing V601's commercial strategy in relation to Probuild's claims, or so as to advance V601's commercial interests.

Probuild's detailed case impugning the independence of the Project Manager

322 By the following extensive alleged 'indicia' as to the Project Manager's lack of independence, Probuild articulates the bases upon which it impugns the Project Manager:[197]

1. The Project Manager is to act as assessor and certifier in respect of the following pursuant to cl 20.2 of the Contract:

(a) whether the defendant is entitled to an EOT;

(b) whether the defendant has achieved Practical Completion;

(c) whether the defendant is entitled to delay damages pursuant to cl 34.9; and

(d) in the assessment of the price of a Variation in accordance with cl 36.4.

2. In performing these functions cl 20.2(b) of the Contract requires, amongst other things:

(a) that the Project Manager act independently of the parties, and that neither party shall be entitled to give directions to the Project Manager;

(b) that the project Manager act reasonably in exercising the identified functions and having regard to the express requirements for the Contract and not the commercial interests of either party.

3. By its Amended Defence and Counterclaim the defendant, amongst other things:

(a) denies the plaintiff's entitlement to liquidated damages based on certificates the Project Manager purported to issue (at paragraphs 7 to 12); and

(b) alleges breaches of the Contract in respect of it being awarded its full entitlements in respect of extensions of time, delay damages a bonus payment and the Façade Return Walls Variation (at paragraphs 19 to 92).

4. Each of the alleged breaches referred to above is particularised to arise by reason of, amongst other things, the Project Manager:

(a) failing to act independently of the parties, as required by cl 20.2 of the Contract;

(b) failing to act reasonably as required by cl 20.2 of the Contract;

(c) failing to have regard to the express requirements of the Contract, as required by cl 20.2 of the Contract; and, or alternatively

(d) having regard to the plaintiff's commercial interests, in contravention of cl 20.2 of the Contract.

5. The defendant contends that the failures and contraventions referred to in paragraph 4, above, arise by reason of the following.

(a) the Project Manager purporting to act as an independent certifier of the defendant's entitlements under the Contract while engaged by the plaintiff pursuant to terms which at all material times required the Project Manager to '[a]dvise, negotiate and provide recommendation for approval of project variation claims and extension of time claims';

(b) the Project Manager failing to disclose to the defendant the terms of its engagement by the plaintiff, as referred to above;

(c) the Project Manager proposing a remuneration arrangement which included a share of the plaintiff's profit from the development at 601 Victoria Street, Abbotsford;

(d) the plaintiff seeking to performance manage the Project Manager from about 6 June 2012 until about 2 October 2012, including by:

(i) issuing a 'show cause' notice to the Project Manager on 15 June 2012;

(ii) renegotiating the terms of the Project Manager's appointment from about 6 June 2012 to about 2 October 2012; and, or alternatively

(iii) withholding payment for the Project Manager's fees from about April 2012 to about 3 October 2012;

(e) the plaintiff withholding payment of the Project Manager's fees from about April 2012 to about 3 October 2012;

(f) the Project Manager seeking and, or alternatively, receiving advice from the plaintiff, or the plaintiff's agents, or consulting with the plaintiff, or the plaintiff's agents, on matters relating to the Project Manager's independent certification functions, or the proper exercise of those functions, and particularly the defendant's claims for extensions of time, the Façade Return Walls Variation and regarding the certification of Practical Completion;

(g) the project Manager requesting that its communications with the defendant and determinations relating to the exercise of its independence certification functions be prepared, reviewed or amended by the plaintiff or its agents, and particularly in relation to the defendant's claims for extensions of time, the Façade Return Walls Variation and regarding the certification of Practical Completion;

(h) the Project Manager seeking and, or alternatively, acting upon the advice an recommendations of the plaintiff's agents relating to its independence certificate functions, or the proper exercise of those functions, and particularly in relation to the defendant's claims for extensions of time, the Façade Return Walls Variation and regarding the certification of Practical Completion;

(i) the Project Manager procuring reports from TBH regarding the defendant's EOT2A and EOT3 claims, knowing that such reports were to be used by the plaintiff or its agents to refute the defendant's EOT2A and EOT3 claims;

(j) the Project Manager participating in meetings and telephone conversations, and being copied into correspondence, between the plaintiff, its agents and TBH regarding the defence of the defendant's EOT2A and EOT3 claims, including:

(i) the establishment and maintenance of any privilege in such reports and summary documents; and, or alternatively

(ii) the content and timing of any determinations regarding the defendant's EOT2A and EOT3 claims having regard to the plaintiff's financing arrangements for the development at 601 Victoria Street Abbotsford;

(k) the Project Manager failing to disclose to the defendant documents produced by TBH having regard to the plaintiff's strategy of maintaining any privilege in such documents;

(l) the Project Manager failing to disclose to the defendant the extent, and content, of the meetings, telephone conversations and correspondence between the Project Manager and any of the plaintiff, its agents and TBH regarding the defendant's independence certification functions;

(m) the Project Manager instructing TBH to attach greater weight to the documents prepared by the plaintiff or the Project Manager, compared to the documents prepared by the defendant, when preparing programs, reports and summary documents regarding the defendant's EOT2A and EOT3 claims;

(n) the Project Manager failing to ask the defendant for further information in respect of its EOT2A and EOT3 claims after about 8 May 2012;

(o) the Project Manager signing a determination dated 15 August 2012 regarding the defendant's EOT2A and EOT3 claims, and issuing it to the plaintiff on about 7 September 2012, but not to the defendant, and despite knowing the extension of time referred to in it was inaccurate;

(p) the Project Manager issuing to the plaintiff, but not to the defendant, a draft determination regarding the defendant's EOT2A and EOT3 claims;

(q) the Project Manager amending the draft determination regarding the defendant's EOT2A and EOT3 claims at the direction of the plaintiff';

(r) the Project Manager amending the draft determination regarding the defendant's EOT2A and EOT3 claims at the direction of the plaintiff to reflect an assessment inconsistent with its views regarding the proper quantification of the defendant's extension for time entitlement;

(s) the Project Manager taking, or failing to take, the steps set out in paragraphs (i) to (r), above, as applicable, knowing that the draft determination was to be used by the plaintiff in its negotiations with the defendant;

(t) the Project Manager refraining from making a determination regarding the defendant's EOT2A and EOT3 claims while:

(i) taking, or failing to take, the steps set out in paragraphs (i) to (r), above as applicable; and, or alternatively

(ii) knowing that the draft determination was to be used by the plaintiff in its negotiations with the defendant;

(u) the Project Manager purported to make determinations regarding the defendant's EOT2A and EOT3 claims by uncritically adopting the findings in a report prepared by TBH;

(v) the Project Manager purporting to make determinations in respect of the defendant's EOT2A and EOT3 claims having regard to unrelated matters, such as project wide 'mitigation measures';

(w) the Project Manager purporting to make determinations in respect of the defendant's EOT2A and EOT3 claims without having regard to a proper delay analysis in respect of those claims;

(x) the Project Manager not knowing and, or alternatively, not ascertaining, the extent to which TBH's report(s) took into account the defendant's submission issued on 19 July 2012 when purporting to make a determination in respect of the defendant's EOT2A and EOT3 claims;

(y) the Project Manager issuing, and then failing to withdraw, a determination in respect of the defendant's EOT2A and EOT3 claims which the Project Manager knew did not represent its opinion;

(z) the Project Manager purporting to make a determination in respect of the defendant's EOT2A and EOT3 claims having regard to the difficulties the plaintiff was then facing with its financing arrangements for the development at 601 Victoria Street, Abbotsford;

(aa) the Project Manager issuing a draft determination to the plaintiff in respect of the defendant's EOT2A and EOT3 claims and, or alternatively, issuing it knowing that it was to be used by the plaintiff in negotiations with the defendant;

(bb) the Project Manager refraining from making a determination in respect of the defendant's extension of time claims and the Façade Return Walls Variation within a reasonable period;

(cc) the Project Manager having regard to the plaintiff's financing arrangements for the development at 601 Victoria Street, Abbotsford when determining the content and timing of any determinations regarding the defendant's extension of time claim;

(dd) The Project Manager pre-judging the Façade Return Walls Variation, and communicating that position to the plaintiff;

(ee) the Project Manager failing to review, or failing to correct, an error in respect of the purported determination regarding the Façade Return Walls Variation;

(ff) the Project Manager refraining from making any determination at all in respect of the defendant's EOT6 claim regarding the proposed Building C childcare centre;

(hh) failing to consult with the plaintiff and the defendant in an equal way.

323 Further, by Annexure 2 in the Probuild Closing Submissions of 11 June 2019, Probuild extensively details the evidence upon which it relies to establish that the Project Manager has failed to perform its certification functions with the required degree of independence. Probuild relies upon 33 heads of asserted 'Indicia', each extensively detailed by reference to the evidence upon which Probuild relies, and its submissions as outlined in Annexure 2 of Probuild's Closing Submissions.

324 I note at this point, that V601 has not sought to traverse, or indeed in my view substantially engage with, the factual case and supporting submissions advanced by Probuild in Probuild's case against the Project Manager, and also V601, detailed in Annexure 2.

325 V601's submissions are instead directed at casting general doubt on the reliability of Probuild's detailed case concerning the Project Manager's lack of independence and V601's involvement in the Project Manager's relevant conduct. In this regard, V601 contends that Probuild's approach to this part of its case has placed V601 in an invidious position, resulting in V601 not responding to the case concerning the independence of the Project Manager as articulated by Probuild. V601 argues in a way which I consider to be most abstruse and without merit, that to respond to Probuild's case which seeks to impugn the Project Manager, and V601 because of its involvement in the same conduct, would somehow unfairly effect a reversal of the onus of proof on this aspect of the case.

326 I reject the contention that matters have evolved in such a way as to somehow unfairly reverse an onus of proof on this topic to V601's prejudice. Nor do I accept that there is good reason for V601 not to fully respond to Probuild's detailed case on the contractually wrongful conduct of the Project Manager and Probuild's case in relation to V601's involvement in that conduct by the Project Manager, by way of submissions and evidence.

327 Annexure 2 of Probuild's Closing Submissions, 11 June 2019, as earlier outlined, details the evidence relied upon by Probuild to establish that the Project Manager lacked independence in its determinations, which are in issue in this proceeding, and for those reasons should be for that reason set aside. Annexure 2 of Probuild's Closing Submissions, 11 June 2019, as outlined earlier, details the evidence relied upon by Probuild to establish that the Project Manager lacked independence in its determinations. The independence of the Project Manager is an issue in this proceeding and, based upon inter alia the Annexure 2 evidence, Probuild says that the determinations resulting from that alleged lack of independence should be set aside.

328 By Annexure 2, Probuild relies upon 33 detailed examples of evidence which it contends establish the Project Manager's lack of independence. In addition, elsewhere in its submissions, Probuild details what it contends are instances of conduct and evidence in this proceeding that further establish the Project Manager's breaches of its obligations in respect of the Contract, and its lack of independence.

329 Ultimately, for the reasons outlined below, I have comfortably concluded, and find, that the Project Manager's conduct in relation to its role as assessor and certifier under the Contract lacked the required level of independence, and was in breach of cl 20.2 of the Contract because, including from the outset of the Precinct Project, the Project Manager failed to appreciate the standard of independence and conduct required of its independent role of assessor and certifier, and allowed its processes of assessment, determination, and certification of Probuild's entitlements under the Contract to be unduly and inappropriately influenced by the Proprietor's strategies and tactics, and the Proprietor's commercial interests.[198]

330 Further, for the reasons outlined below, I am also comfortably satisfied and find that the Project Manager was not independent and impartial, and was also not fair, and reasonable in its assessment and certification of Probuild's time extension claims and entitlements, as well as Probuild's entitlements to delay damages under the Contract.

331 The conclusions and findings in relation to the Project Manager's lack of independence and breaches of cl 20.2 of the Contract are based on the establishment of the Indicia detailed in Annexure 2 - fours heads of which are addressed in detail below. These conclusions and findings are also based upon the additional findings outlined below in relation to the Project Manager's evidence.

332 Having so concluded and held, I consider it unnecessary to endeavour to deal with the remaining detailed Indicia relied on by Probuild in Annexure 2 which, in my view, would entail further very extensive, and in the circumstances unnecessary, judicial attention.

333 I also add, however, that in addition to the four heads of Indicia addressed below, I am comfortably satisfied that Probuild's other identified Indicia 6, 7, 8, 9 and 10 (extracted below) are also established against the Project Manager in relation to the other instances of the Project Manager's conduct detailed in the Indicia in Annexure 2. Furthermore, I consider that the additional established Indicia in Annexure 2 are also sufficient to impugn the Project Manager and justify setting aside all its assessments, determinations, and certifications under the Contract.

334 Further, for the reason outlined below, I am also comfortably satisfied, and find that the Project Manager and V601 collaborated in relation to a strategy, which was planned and implemented by the Project Manager and V601, to liaise in relation to the Contractor's extension of time claim(s) and to discuss and settle on the Project Manager's issuing of a 'draft determination' in relation to Probuild's extant extension of time claim; after which, the Project Manager would provide his draft determination to the Contractor, so as to create an opportunity for the Principal to negotiate with the Contractor to agree a final determination of Probuild's extension of time claim, which then achieved the best outcome for the Principal. The Project Manager's conduct in this regard also, I consider, delayed the establishment of the Contractor's entitlements under the Contract.

335 For example, in relation to Probuild's EOT2 claim issued on 6 March 2012,[199] the Project Manager issued a draft response to V601 on 13 March 2012, seeking comment from the Proprietor and, after receiving V601's response and input at about 9:53am on 14 March 2012, the Project Manager emailed its decision to Probuild in relation to WUC EOT2 on 14 March 2012 at 5:29pm.[200] That draft response proposed rejecting the Contractor's claim of 25 working days and required it to be resubmitted. In my view, no satisfactory explanation was forthcoming from Nave in relation to why referring such a draft notice to the Proprietor for its consideration was appropriate, rather than provision of a clear, unequivocal contractual decision in relation to the EOT2 claim by the Contractor.[201]

336 It is instructive to note the nature and content of certain email communications between the Project Manager and V601, immediately before the Project Manager's 14 March 2012 decision in relation to Probuild's EOT2 claim.

337 On 13 March 2012, Nave, the Project Manager, emailed the Proprietor (in part) in the following terms:[202]

Colin, [Mackenzie of SPG the Proprietor]

Attached are the following documents to be issued to Probuild, please review and provide comments so these can be issued Wednesday afternoon.

1. Notice to commence works under contract, (Dates as agreed, note the contract reference of 9A(b)(iii)

2. Approval for EOT no 1:

Approval of EOT No l adjusted to 8 working days (Friday 13 January 2012 was not classified as a working Day and the Site was closed) This Extension of time has been approved for the Practical Completion adjustment to Separable Portion No 3 Building D and Separable Portion No 4 Building E only. The qualifying clause of delay was due to the incompletion of the Early Works Contract, and adjusts the start date for these separable portions by 8 working days. No delay costs are applicable to the EOT as an adjusted to the Start date only.

3. Non Approval for EOT no 2:

Extension Of Time No 2 issued 6th March 2012 for the relating to the commencement of pile caps to Buildings D (SP3) and Building E (SP4) totalling 25 working days is not approved.

...

Please demonstrate the re-sequence of works to mitigate the delay, including a program on completing the Ground Works and basement slab in the next 10 weeks. Provide alternatives in reducing the potential delay to Building D and E, i.e afterhours works for critical path activities.

...

338 On 14 March 2012 (9:53am), the Proprietor replied to the Project Manager in the following terms:[203]

John,

Seems like the correct response this stage. It gives us an opportunity to see what they hit back with.

I think we need however to reference the contract clause that relates to re-sequencing etc. This should be added to your comments relating to item 3.

C

339 By the above, the Project Manager sought to have the Proprietor's review and comment on its draft determination of EOT1 and the Project Manager's proposed response to Probuild's EOT2 claim.

340 Further, by the above email of 14 March 2012, the Proprietor provided its view that the Project Manager's draft determination of EOT1 and rejection of EOT2, in the following terms, '[s]eems like the correct response [at] this stage', and also communicated to the Project Manager that its proposed draft response to Probuild 'gives us an opportunity to see what they hit back with'.

341 In my view, the Proprietor's above email of 14 March 2012 (9:53am) reflects the nature of the collusion and co-operation between the Proprietor and the Project Manager to work in unison and deploy their strategy and tactics to manage the Contractor's claims. That communication, read together with the above emails from 13 and 14 March 2012, also evince the Project Manager's willingness to obtain V601's input and approval of the Project Manager's draft extension of time assessments and determinations, before they were communicated to Probuild.

342 By email on 15 March 2012, Sleeman of Probuild reported on potential delays to the Project.[204]

343 On 16 March 2012, Mackenzie, the Development Director on the Project for V601, communicated with the Project Manager stating, amongst other things, that V601 suggested that the responses to Probuild's extension of time claims should include a reference to certain provisions of the Contract and also stated:[205]

OK then maybe we try an (sic) wrap it in with eot discussions. Since they disagree with ur (sic) assessment we can use this as our good faith gesture in the argument over the eot.

344 There appears to be no contemporaneous communication from Nave, the Project Manager, which in any way objected to, or attempted to distance the Project Manager from, Mackenzie's proposed strategy and tactical suggestions in relation to either the above 14 March 2012 or the 16 March 2012 communications, in relation to Probuild's extension of time claims, EOT1 and EOT2.

345 On 20 March 2012, Mackenzie emailed the Project Manager advising that the Proprietor was about to meet with V601's lawyers, Baker McKenzie, to review and discuss potential delays and damages, and seeking Nave's 'summary of why they (Probuild) are not entitled to anything'. The Proprietor's 20 March 2012 email to the Project Manager states:[206]

John,

James and I are meeting Baker McKenzie on Friday morning (7.30) to review and discuss each of the potential delays and damages.

We need you to prepare a document including:

a) Each of the issues listed below and ANY other ones currently on the table -this should include a review of any potential things that may cause extra costs under the contract that may be contested including Coles base building works etc. - note we (salvo) will consider this all inclusive and will be used to formulate a settlement position please ensure you are being accurate.

b) A copy of ALL correspondence from PCA to date and from yourself that clarifies our position.

c) Your summary of why they are not entitled to anything including references to the contract.

We need an honest appraisal of the position as this may end up in litigation. The lawyers will then assess the correspondence and identify our best position moving forward (i.e. prepare for litigation with a hard stances or seek to negotiate a deal early). We can all agree that we are at the cusp of some potential conflicts worth millions and therefore we want to be on the front foot.

Let me know if there are any issues.

Thanks,

Colin

346 In my view, the Proprietor's email request of 20 March 2012, and the earlier Mackenzie emails to the Project Manager of 14 March 2012 and 16 March 2012, were inappropriate communications for a Proprietor to send to the independent assessor and certifier under the Contract, for the reasons I have outlined above in relation to these emails, because they were suggesting strategies and tactics in relation to Probuild's extension of time claims. It appears, however, that Nave and the Project Manager neither objected to these communications nor did Nave seek to distance the Project Manager from such communications.

347 I am satisfied that the Project Manager, as represented by Nave, did not take issue with the manner in which V601 and Mackenzie were communicating with the Project Manager in relation to strategy and tactics. Further, I am satisfied that the above communications demonstrate that V601 and the Project Manager were working in concert to plan and implement strategies and tactics in relation to the Contractor's extension of time claims EOT1 and EOT2 to delay and, if possible, defeat or minimise the entitlement certified by the Project Manager in favour of the Contractor.

348 Nave did not reject or discourage communications like Mackenzie's emails of 14 March 2012 and 16 March 2012 to the Project Manager. Nor did the Project Manager purport to have done so in his evidence under cross-examination.[207]

349 I am also satisfied in relation to the matters referred to above that the Project Manager co-operated and colluded with V601 to devise and implement strategies and tactics that would advantage V601 in its responses to, and in dealing with, Probuild's time extension and delay damages claims under the Contract.

350 On 22 March 2012 and 28 March 2012, Nave provided his views to V601's lawyers in relation to the delays referred to by Sleeman of Probuild on 15 March 2012.[208]

351 In a communication to the Project Manager on 11 April 2012, Mackenzie requested the following:[209]

Please send through your rejections as discussed.

Also please confirm you have contacted your programmer in relation to the EOT's and the program. We also need to contact an independent QS to review the appropriate preliminaries. I suggest someone different to WT. Please urgently act on the above.

352 On 16 April 2012, the Project Manager provided 'draft responses' to Mackenzie of V601, in relation to Probuild's EOT2A and EOT3, and copied those draft responses to V601's lawyers.[210] Mackenzie responded to the Project Manager and V601's lawyers as follows:[211]

I would have thought we actually issue a formal rejection on the basis that adequate information has not been supplied. We can ask them to resubmit with what John has requested.

Alison/Tony can you advise?

353 The Project Manager should have readily understood that the above communications from V601 to the Project Manager were inappropriate, for the reasons outlined above. The absence of any attempt by the Project Manager to object to V601's suggested tactics, particularly given that V601's communications sought to influence the Project Manager in relation to its assessment and certification of the Contractor's extension of time claims, also reflects a lack of understanding by the Project Manager of its obligations of independence as the assessor and certifier under the Contract, as well as reflecting a lack of independence on the part of the Project Manager. The same communications referred to above also reflect V601's inappropriate and contractually wrongful conduct in enlisting the Project Manager as part of a 'team' to advantage V601 in respect of Probuild's claims under the Contract.

354 I am further satisfied that V601 and its lawyers, and the Project Manager, were actively working as a team to implement a collective strategy to delay and reduce the Contractor's entitlements to extensions of time and delay damages, and to thereby maximise the Principal's ability to achieve the most favourable commercial outcome for itself in relation to the Contractor's time extension, delay cost, and other contractual claims. This contractually wrongful conduct on the part of V601 and the Project Manager, I find, was occurring from at least the time when Probuild submitted the first EOT2 claim; namely, from about early March 2012.

355 On 18 April 2012, V601's lawyers provided the Project Manager with a draft response to Probuild's EOT2A and EOT3 claims.[212] The revisions suggested to the Project Manager by the Proprietor's lawyers were, I note, subsequently wholly adopted by the Project Manager. In this instance, the Baker McKenzie input was limited to inserting references to contractual provisions relevant to the Project Manager's requests of Probuild. I also note that Baker McKenzie appropriately observed that the writer was mindful that the Project Manager was the person making the relevant assessment. The Project Manager's letter to Probuild of 19 April 2012 adopted all of the changes suggested by V601's lawyers, which were formal in nature.[213]

356 On 30 April 2012, V601, its lawyers and the Project Manager arranged a meeting to 'determine where we stand in relation to the EOT's/delay damages'.[214] At that meeting, which occurred on 1 May 2012, it is clear by reference to contemporaneous communications[215] that those involved included the Project Manager, Salvo, Maitland and Mackenzie, and V601's lawyers from Baker McKenzie. By reference to the same material, it is also clear what was discussed at the meeting of 1 May 2012; namely Probuild's extension of time claims, EOT1, EOT2, and EOT3. In relation to EOT3, 'it was agreed that there will be some cost for works but not necessarily any delay'.[216] V601's lawyers cautioned against telling Probuild how they should be programming the works and foreshadowed that Probuild might be setting up V601 for future litigation.[217]

357 The minutes of the meeting of 1 May 2012 also record:[218]

Under EOT3

The engagement and use of an independent programmer will assist in developing a counter argument for any potential claim that Probuild may seek at a later date.

Under EOT2

At present, based on Probuild's program, it has not been delayed. The original Program allocated 58 days and this date is not until end of May.

Summary EOT2

Plus John needs to start more aggressive communications in terms of seeking documents and evidence. For example stating, 'this is what the contract says and this is what is required'.

358 In respect of the meeting on 1 May 2012, at which the Project Manager was present and actively involved, I am satisfied that those present agreed, amongst other things, on matters of approach, strategy, and tactics in relation to Probuild's claims, and that the engagement and use of an independent programmer would assist in developing V601's counter arguments to any potential claims Probuild might seek to make at a later date.

359 I am also similarly satisfied that, at the 1 May 2012 meeting, the Project Manager was urged by V601 to become more aggressive in its communications with the Contractor in relation to seeking documents and evidence.[219] I also note that, as set out above, the meeting recorded conclusions as to delay in relation to EOT2.

360 I consider that Nave's active participation in the meeting of 1 May 2012, in particular given the objectives of that meeting referred to above and given the matters discussed, was inappropriate and in breach of both the Principal's express and implied obligations not to interfere with or direct the Project Manager in the performance of his role as independent assessor and certifier.

361 For the same reasons, I also consider that the Project Manager's involvement and active participation at the 1 May 2012 meeting, including the development of strategies to counter and delay the Contractor's extension of time claims, reflects a stark lack of appreciation by the Project Manager and by the Principal, V601, of the Project Manager's obligations of independence and impartiality.

362 My above conclusions are also supported by the failure on the part of the Project Manager to, in any way, object to or distance himself from attending and participating in a meeting of the type which occurred on 1 May 2012, either before or after the occurrence of the meeting, particularly given that those who were to be in attendance included the principal of V601 and three of V601's lawyers. The Project Manager at no point placed on the record that it could not, given its independent and impartial role as assessor and certifier, participate in, or cooperate with, the Proprietor and its contractual team's development and implementation of tactics developed to delay and minimise the certification and payment of the Contractor's entitlements under the Contract.

363 The Project Manager's failure to communicate to V601 that it felt conflicted by, and could not reconcile its obligation to act independently and impartially as assessor and certifier in respect of the Contract with, being actively involved with V601 and third parties employed by it to assist and advantage V601 under and in respect of the Contract, in relation to Probuild's contractual claims, supports my conclusions and findings in relation to the Project Manager's failures from about March 2012. These include the Project Manager's failure to understand its obligations of independence and impartiality as assessor and certifier under the Contract, and to act accordingly, including through Nave's actions, by conducting itself in a way which most effectively avoided undue influence exerted by the Principal or any appearance of such undue influence.

364 I am also satisfied that, from about March 2012, V601 substantially increased the extent of its influence and inappropriate pressure on the Project Manager, with the objective of having the Project Manager address and determine Probuild's time extension and related claims as slowly, and then as favourably, as possible to the Principal.

365 Furthermore, from at least mid-May 2012, V601 also employed Integrated Project Services Pty Ltd, a company at which Mr James Chryssafis (Chryssafis) was Managing Director, to oversee the Project Manager and provide input to the Project Manager in relation to Probuild's extension of time claims and the Project Manager's assessment and certification of those claims.[220] V601 also instructed Chryssafis and Nave, in substance, to jointly recommend whether V601 should consider immediately rejecting the Contractor's EOT2A and EOT3 claims.[221]

366 Further, under cross-examination, Nave stated that Chryssafis was harassing him.[222] Nave also stated that:[223]

And then at 461, he says to you, 'Also, John, can you forward us a copy of the following actions: TBHs assessment' - et cetera, et cetera, and then he says, 'Finally, I would seriously consider rejecting EOTs 2A and 3'. I'm ‑ ‑ ‑?‑‑‑Yeah.

Yes?‑‑‑Couldn't care less what he said.

But he was saying that to you ‑ ‑ ‑?‑‑‑Hey?

‑ ‑ ‑ though, wasn't he?‑‑‑Yeah, but I couldn't care ‑ ‑ ‑

Yes?‑‑‑ ‑ ‑ ‑ less what he was saying to me.

Okay. Now, you thought he was an idiot?‑‑‑Yeah, absolutely.

Okay. But he's the man that James Maitland turned to to bring in to look over your - to put pressure on you; correct?‑‑‑Well, I don't know who brought him on, ah, in terms of from Salvo's office.

Yes?‑‑‑Yeah.

Yes. But this is a pretty critical time, isn't it?‑‑‑It's a pretty critical time. It's in May.

Yes. You were ‑ ‑ ‑?‑‑‑Yeah, 12. I'm - yeah - knee-deep in all the issues.

Yes. And ‑ ‑ ‑?‑‑‑Yep.

‑ ‑ ‑ you're being criticised at the same time for the way you've handled things?‑‑‑Correct.

Yes. And then Mr Chryssafis comes in as well?‑‑‑Yeah.

Yes. So on any objective view, you would have to say you were being pressured?‑‑‑Um, no, not from him.

Okay?‑‑‑No.

Being pressured more generally by V601?‑‑‑Oh, I got pressure from both sides.

Okay?‑‑‑I had pressure from Probuild ‑ ‑ ‑

Okay?‑‑‑ ‑ ‑ ‑ a hell of a lot as well, so I don't think it was isolated to any one side.

367 On 18 June 2012, the Project Manager sent a draft of his proposed response to Probuild's Façade Variation claim to Mackenzie of V601.[224] Later that day, Mackenzie responded that V601 wanted a legal review of that proposed response, therefore the Project Manager's draft response to Probuild's Façade Variation claim would be sent to the Principal's lawyers.[225]

368 On 19 June 2012, V601, via its lawyers, provided the proposed amended version of Nave's draft response to Probuild's Façade Variation claim to the Project Manager.[226] Thereafter, the Project Manager's response to Probuild was sent to Probuild substantially in the amended form suggested by V601's lawyers.

369 By mid-2012, V601 had engaged an expert programmer, TBH, as part of its contractual claims response team to assist it and the Project Manager to analyse the Contractor's delay claims, and to assist V601 and the Project Manager in developing counter arguments to any potential Probuild delay claim.[227] As part of this process, V601 was intent not to provide Probuild with a copy of TBH's reports, and I accept that Nave was aware of V601's strategy in that regard. Indeed, on 16 July 2012, V601's lawyers emailed Nave and others directly to advise that the Project Manager should not provide Probuild with TBH's report when delivering its assessment of Probuild's EOT2A and EOT3 claims.[228]

370 V601's lawyers' communication to their client, V601, and to the Project Manager, on 16 July 2012, was in the following terms:[229]

Colin/James/John,

Please see attached a revised version of the letter to Probuild in relation to EOT claims 1 to 6.

By way of overview, John needs to make a determination of the EOT claims based upon his own assessment and not simply adopt the findings of TBH. We have amended the letter so that the determination appears to have been made solely by John/First Urban.

We have also amended the letter to remove any reference to TBH or its report altogether. The reason for this is that the report, on one construction, may be privileged in the sense that it was prepared in anticipation of dealing with claims from Probuild. In order to preserve any privilege, V601 should not provide Probuild with a copy of the report, nor should it disclose its contents. To the extent that this has already been done, privilege may have been lost.

Separately to the issue of privilege, providing the TBH report to Probuild would simply open up further bases for Probuild to challenge the position taken by V601 with respect to the EOT claims. It is more manageable, from V601's perspective, that any dispute regarding the assessment of EOT claims is solely in respect of First Urban's determination.

371 By 16 July 2012, V601's lawyers had substantially amended Nave's draft assessment in relation to EOT2 and EOT3, including removal of all references to TBH's input in relation to those claims from the Project Manager's intended communication to the Contractor.[230]

372 Under cross-examination, Nave did not directly refute the proposition that V601's lawyers' advice to withhold references to TBH from his report was done for tactical reasons. When cross-examined on this aspect, Nave stated:[231]

Did you take that communication from Baker McKenzie to be in the nature of a purely tactical position that they were recommending?‑‑‑It seems like, um, they didn't want that report to go to them.

For tactical reasons?‑‑‑Possibly. But the report wasn't final, Your Honour. TBH hadn't, at that point, received all the information from Probuild, which then - they spent another - some time again reviewing that report and coming up with another report on 9 August and then another report on 7 September.

373 Further, by email dated 18 July 2012, V601's lawyers communicated to the Project Manager that:[232]

John

I'd suggest you (us) do a summary of their logic and you rely on that without referring to TBH. If you refer then they will call for full report.

374 The day before the above communication, in an email dated 17 July 2012 from V601's lawyers to V601's Chief Operating Officer, Maitland, V601's lawyers stated:[233]

James,

I understand the logic. A solution maybe to meet with TBH and condense their Report so that we eliminate the areas for 'debate' by Probuild. What I want to avoid is Probuild presenting arguments to us based on the TBH Report which if we accept means we must give them more time and money.

Happy to speak to Colin further.

375 On 26 July 2012, V601's lawyers circulated a draft of TBH's Report received on that day to the V601 claims response team, including the usual lawyers at Baker McKenzie, the Project Manager, Nave, and his assistant, as well as Mackenzie and Maitland of V601, asking the team members to review the draft TBH Report and also suggesting to those to whom it was circulated, including the Project Manager, that the circulation of the TBH Report needed to be limited 'in order to preserve privilege'.[234] On 11 July 2012, prior to circulation of the Report, the Project Manager emailed a copy of the TBH Site Status Report and a draft proposed letter, from the Project Manager to Probuild, to V601's lawyers for review and comment.[235] The Project Manager's draft letter was then viewed by V601's lawyers, revised, and returned to V601 and the Project Manager on 16 July 2012 for transmission to Probuild.[236]

376 Baker McKenzie's letter dated 16 July 2012, which returned the draft of the Project Manager's letter to Probuild to the claims response team, included a statement to its client and also to the Project Manager that:[237]

Please see attached a revised version of the letter to Probuild in relation to EOT claims 1 to 6.

By way of overview, John needs to make a determination of the EOT claims based upon his own assessment and not simply adopt the findings of TBH. We have amended the letter so that the determination appears to have been made solely by John/First Urban.

We have also amended the letter to remove any reference to TBH or its report altogether. The reason for this is that the report, on one construction, may be privileged in the sense that it was prepared in anticipation of dealing with claims from Probuild. In order to preserve any privilege, V601 should not provide Probuild with a copy of the report, nor should it disclose its contents. To the extent that this has already been done, privilege may have been lost.

Separately to the issue of privilege, providing the TBH report to Probuild would simply open up further bases for Probuild to challenge the position taken by V601 with respect to the EOT claims. It is more manageable, from V601's perspective, that any dispute regarding the assessment of EOT claims is solely in respect of First Urban's determination.

377 A further element of the principal's strategy and intent in relation to the management and determination of Probuild's claims is exposed by an internal email dated 31 July 2012 between Mackenzie and Maitland of V601. That communication relevantly states:[238]

The final report (from TBH) will come in the next week once they have done the status update. The strategy will then be to issue the report and have John reduce the days further for contributing to the delays.

378 A further relevant meeting occurred on 7 August 2012, which was attended by Ashford, Mackenzie, Nave, Coraci, Mr Ian Buchanan-Black of TBH, and a representative of V601's lawyers, Baker McKenzie.[239] At the meeting of 7 August 2012, the Project Manager was an active participant[240] and was advised, amongst other things, that the Proprietor 'does not have the money to stump up for Probuild's claim'.[241]

379 At the meeting on 7 August 2012, a decision was also reached not to give TBH's delay report to Probuild, and the Project Manager was instructed to 'paraphrase TBH report and make determination in response to Variation Claim'. At that same meeting on 7 August 2012, the Proprietor and the Project Manager discussed the weakness of any claim that Probuild might bring in relation to Building D, even though no formal claim had been made by Probuild at that time.

380 At this meeting of the claims response team on 7 August 2012, a strategy was discussed which involved the Project Manager preparing a report to be reviewed by the Principal's lawyers. Separately, it was planned that TBH would also prepare its own report. At this same meeting, there was also discussion at which the Project Manager was present about the object of keeping the financier happy, where it was stated that the Financier was 'holding huge amounts off Mario at the moment'.[242] There was also discussion, at which the Project Manager was present, about a strategy to resolve Probuild's extension of time claims pending the Project Manager's assessment.[243] The Baker McKenzie meeting notes of 7 August 2012 include:[244]

Strategy

- John does report - BSM to review

- TBH to do own report based on 30 July program

- point of wanting to do deal on D and E is to show financier that there has been a levelling of claims by Probuild

- objective is to keep the financier happy

- willing to take the risk in giving EOT on building D unilaterally

- ie that Probuild won't make further claims on D

- if we give D 10 days now then this is the starting point of negotiations

- better off doing a total deal

- need to let Probuild know a deal is coming so that they don't issue a 3 month EOT on D

- Financier is very pro TBH

- Financier is holding huge amounts off Mario at the moment.

381 On the basis of the evidence, including the parts of the evidence referred to and highlighted above, I am also comfortably satisfied that these and numerous other contemporaneous communications between V601, its lawyers, Baker McKenzie, TBH, and the Project Manager show that the Project Manager was part of a claims response team assembled by V601, including the Principal and its advisers, to develop and implement a strategy and apply tactics to delay and defeat and minimise Probuild's entitlements to time extensions and associated delay damages. Further, the strategy involved enlisting Nave, the Project Manager, to develop and implement that strategy, as well as applying pressure on the Project Manager to deal with the Contractor's time extension and delay damages claims in a way that assisted V601 and served its commercial interests.

382 I am also comfortably satisfied that the objectives of the claims response team, and the strategy it pursued, included delaying and minimising the determinations by the Project Manager and thereby its certification of the Probuild entitlements, under the Contract, to extensions of time and consequential delay damages.[245]

383 I am also comfortably satisfied that at conferences between V601 and the Contractor's claims response team, to which I have referred, additional conferences in which the Project Manager also participated, including on 6 September 2012, placed the Project Manager under inappropriate and very considerable undue influence from V601 and its claims response team advisers. I am comfortably satisfied that the Project Manager very early in the Project succumbed to this inappropriate and very considerable undue influence and pressure by V601's team, including Mackenzie (V601's Development Director), Maitland (V601's Chief Operating Officer), and V601's advisers to delay decisions, in relation to and to defeat if possible, or otherwise minimise, Probuild's time extension and delay damages entitlements under the Contract.

384 Further, I am comfortably satisfied that my above findings and conclusions also evinced the Project Manager's failure to properly understand the need for its conduct in relation to, and the performance of, its independent assessment and certification role under the Contract to be unwaveringly independent, impartial, fair and reasonable, in accord with the express requirements of the Contract, and without regard for the commercial interests of either party to the Contract.

385 I am also comfortably satisfied that Nave, as Project Manager, willingly participated as part of the V601 claims response team, in respect of the team's objectives to which I have made earlier reference. This included the process adopted by V601 and its claims response team, which involved the Project Manager producing drafts of his assessments of the Contractor's claims, before the Project Manager issued its assessments and related certifications to Probuild, and awaiting comment and suggestions from other members of the V601 team, including as to the timing of the Project Manager's determinations.[246]

386 The file note of a telephone conversation on 13 September 2012, in which V601's lawyers spoke to Coraci, a project manager employed by the Project Manager, and a person working closely with Nave on the Precinct Project, recorded the following:[247]

Josie Coraci

- just spoke to Colin, can't have the meeting this afternoon as Colin is waiting on our legal advice

- legal advice underway

- obviously a determination needs to be issued

- apparently First Urban issued a formal notification and assessment of EOT claims last week

- gave to Colin

- Colin then directed Frist Urban to reissue with different assessment

- this revised assessment was the one handed over in draft to Probuild at last week's meeting

- First Urban feels secure in the manner they have conducted themselves

- made sure assessment was within requisite time

- Colin is obviously not wanting formal assessment issued so he can negotiate

- understand his position

- Colin has meeting this afternoon with Matt Bready of Probuild

- may change things from thereafter

387 This and other similar materials substantiate V601's strategy, which I am satisfied establishes that the Project Manager, principally through its principal Nave, worked complicitly to manage the timing and aspects of the content of the Project Manager's responses, assessments, and certifications to the Contractor's claims, and so to advantage V601.

388 On 7 September 2012, the Project Manager's draft delay damages assessment went to V601 for review.[248]

389 On 5 September 2012, and in revised form on 7 September 2012, TBH provided a Mitigation Actions and Separable Portion Report to Baker McKenzie that was then provided to the Project Manager and V601.[249]

390 On 7 September 2012,[250] V601, via Mackenzie, requested that a draft assessment be issued based on the dates identified in TBH's 'mitigation strategies' report which had been issued that same date, and which was perceived by Mackenzie to be more favourable to V601.[251]

391 Further, in my view, the degree to which Nave was drawn into and enmeshed in the V601 claims response team, its thinking, and its strategy and tactics, is significantly supported by the fact that Nave, when confronted by Probuild during the Project with allegations that he lacked independence, then immediately sought advice from V601's own lawyers.[252]

392 Further evidence of the Project Manager's principal, Nave, not appreciating the nature and extent of the obligations of an independent and impartial assessor and certifier, and the way in which an independent, impartial, fair and reasonable assessor and certifier should conduct themselves, is reflected in the Project Manager's actions in October 2012, when Probuild issued a Notice of Dispute alleging that the Project Manager had not acted independently in relation to Probuild's extension of time claims. It is notable and troubling that the Project Manager's email of 22 October 2012 concerning the Notice of Dispute issued by Probuild, in relation to extension of times, was referred by the Project Manager directly to Baker McKenzie, V601's lawyers.[253]

393 In reaction to Probuild's above allegations, Nave emailed the Proprietor's lawyers directly and sought advice on an aspect of how the Project Manager should respond. In so doing, the Project Manager was seeking advice from the lawyers for the very party accused of compromising the Project Manager's independence.

394 When these matters were put to Nave in cross-examination, in my view, his responses made it clear that he failed to appreciate that it was anomalous and inappropriate for the Project Manager to seek advice from the Proprietor's own lawyers, in relation to the Contractor's allegation that the Proprietor had compromised the Project Manager's independence.[254] The answers provided by the Project Manager to questions put by Probuild's Senior Counsel highlighted that the Project Manager was, himself, not sure whether an independent certifier should seek advice in respect of a Notice of Dispute alleging lack of independence from the lawyer for the party alleged to have compromised the independence of that independent certifier.[255]

395 Further, by May 2013, it is clear that the Project Manager had become accustomed to communicating directly with V601's lawyers. This is established by the following. On 12 November 2013, Probuild submitted its Occupancy Permit for Stage 1 to the Project Manager requesting that Practical Completion for Stage 1 be granted for 8 November 2013. That communication was also forwarded to the Principal. This resulted in V601's lawyers communicating with the Project Manager on 13 November 2013[256] and advising that it was not appropriate for Probuild to request Practical Completion by means of an email, and also advising that Probuild ask the Project Manager to backdate the date of Practical Completion to 8 November 2013. The Proprietor's lawyers also advised the Project Manager to ask Probuild to follow the Contract in relation to cl 34.6 and express the Contractor's opinion about when Practical Completion had been reached. I also again note that Baker McKenzie appropriately advised the Project Manager that the email which Baker McKenzie was recommending that the Project Manager send to Probuild should be 'in the form you are comfortable with'.

396 Under cross-examination, Nave acknowledged that, in this regard, the position adopted by V601's lawyers in their email dated 13 November 2013 was technical and that he did not agree with it. However, the Project Manager nevertheless acceded to the above request by V601's lawyers and sent the letter drafted by V601's lawyers to the Contractor.[257]

397 Similarly, in relation to the Project Manager's recognition of the Dates of Practical Completion, on 30 October 2012, Probuild notified the Project Manager that Practical Completion of Stage 1 was about to occur[258] and, in response, McKenzie emailed Maitland, in an email which included McKenzie saying: 'You and I should discuss tactics here. Obviously without titles we should not concede even one point on PC or its on our own dollar.'[259] V601's lawyers then worked on a communication to send to the Project Manager providing the Project Manager with potential legal technicalities, in my view, clearly calculated to delay and bog down the certification of Practical Completion.[260] I infer from these circumstances that this formed part of V601's strategy, acquiesced in by the Project Manager, in a way which again I consider establishes the Project Manager's lack of independence, to delay certification of Practical Completion and to advantage V601, including by generating liquidated damages, which I consider it is reasonable to infer V601 thought would benefit it by offsetting V601's likely interest costs. This is because under the Contracts of Sale of the Precinct apartments, settlement was to occur 14 days after the purchaser was notified of the registration of the Plan of Subdivision in relation to Buildings B and C.

398 The relevant Plan of Subdivision for Buildings B and C was not registered until 15 November 2013. Further, I consider that the inference which I have drawn is strongly supported by the Project Manager's evidence under cross-examination that, although he communicated the legal technical issues referred to above (raised by V601's lawyers) concerning certification of Practical Completion to Probuild, Nave conceded that the points raised by V601's lawyers and highlighted to Probuild were 'highly technical' and that he ( Nave ) personally did not agree with the technicalities raised.[261]

399 As earlier outlined, I am also comfortably satisfied on the evidence, including the specific evidence outlined above, that the additional Indicia 6, 7, 8, 9 and 10 of actions by the Project Manager, which Probuild allege establish lack of independence on the part of the Project Manager in Annexure 2 of the Probuild Closing Submissions dated 11 June 2019, also separately and additionally establish contractually wrongful undue influence by the Proprietor V601.

400 The evidence and conclusions referred to in the last preceding paragraph constitute further examples of conduct establishing that the Project Manager, by its principal Nave, failed to perform its assessment and certification functions under the Contract with the required degree of independence, and impartiality, and in a fair and reasonable manner, and in accordance with the express requirements of the Contract and also failed to perform the functions referred to without regard for V601's commercial interests. For these additional reasons, the Project Manager also breached cls 20(b)(i) and (iii) in relation to cl 20.2(a)(i)-(iii) of the Contract.

401 The additional Indicia referred to in the last two preceding paragraphs which are separately established, are those relied upon by Probuild in 6, 7, 8, 9 and 10 of Annexure 2, summarised below:[262]

6. The Project Manager requesting that its communications with Probuild and determinations relating to the exercise of its independent certification functions be prepared, reviewed or amended by V601 or its agents, and particularly in relation to Probuild's claims for extensions of time, the Façade Return Walls Variation and regarding the certification of Practical Completion.

7. The Project Manager seeking and, or alternatively, acting upon the advice and recommendations of V601's agents relating to its independent certification functions, or the proper exercise of those functions, and particularly in relation to Probuild's claims for extensions of time, the Façade Return Walls Variation and regarding the certification of Practical Completion.

8. The Project Manager procuring reports from TBH regarding Probuild's EOT2A and EOT3 claims, knowing that such reports were to be used by V601 or its agents to refute Probuild's EOT2A and EOT3 claims.

9. The Project Manager participating in meetings and telephone conversations, and being copied into correspondence, between V601, its agents and TBH regarding the defence of Probuild's EOT2A and EOT3 claims, including:

(a) the establishment and maintenance of any privilege in such reports and summary documents; and, or alternatively

(b) the content and timing of any determinations regarding Probuild's EOT2A and EOT3 claims having regard to V601's financing arrangements for the development at 601 Victoria Street, Abbotsford.

10. The Project Manager failing to disclose to Probuild documents produced by TBH having regard to V601's strategy of maintaining any privilege in such documents.

(a) From at least about early April 2011, Nave did not appear to understand the Project Manager's duties and obligations of independence and impartiality. In my view, this is established by Nave's conduct through First Urban proposing to be engaged as Project Manager with a scope of duties and obligations, including obligations to act as assessor and certifier, and in the same proposal also seeking to agree the payment of additional fees and a percentage of total gross profit of the Project, dependant on ultimate Precinct Project profit levels;[263]

(b) The significance of the financial success of the Precinct Project to Nave, and First Urban, was raised and emphasised by Mackenzie and SPG in an email to Nave on 8 February 2012,[264] in which Mackenzie stated that:[265]

I believe you have these issues well in hand however I also believe that currently we (Salvo and accordingly First Urban) are at financial risk and time risk because PCA is taking the approach that it's not their issue. Better coordination in the construction meeting should help balance the responsibility and give us (Salvo) some comfort that there is no looming costs or delays resulting from the above.

... As you know Salvo use this as a full service solution from First Urban and accordingly a financial impact will eventuate if Salvo suffers as a result of coordination issues with PCA and First Urban. So that we can both avoid this let's be proactive in addressing the above.

(c) On 16 February 2012,[266] Nave responded to Mackenzie's earlier email of 8 February 2012, and included many detailed comments in response to that email. Nave accepted and did not comment in any way upon Mackenzie's statement that SPG (V601), and First Urban, the Project Manager, were at 'financial risk and time risk', as referred to above. Nor did Nave comment on Mackenzie foreshadowing the possible financial impact on First Urban, if SPG was to suffer as a result of coordination issues for which V601 held the Project Manager responsible;[267]

(d) In my view, the proposed Project Management Agreement between First Urban and V601 was to include a profit-share arrangement until about the beginning of October 2012, when a Deed of Variation to the Project Management Agreement, between V601 and First Urban, acknowledged and agreed to waive, release, and discharge V601 from any right, entitlement, or claim it may have to share in the profit of the project.[268]

Until about the beginning of October 2012, I find that Nave and First Urban continued to propose and pursue a Project Management Agreement with V601 which included a profit incentive payable to the Project Manager, and which was tied to the commercial success of the Precinct Project. The same proposed Project Management Agreement also contemplated that the Project Manager would act as the independent assessor and certifier under the related Contract with Probuild;

(e) Nave, through First Urban, also considered it appropriate for the terms of engagement of the Project Manager to extend to advising, negotiating, and providing recommendations for approval of project variation claims and extension of time claims;[269]

(f) I also find, as established by the above evidence, including the evidence of the Project Manager's conduct establishing its lack of independence as particularised in Probuild's Indicia at Annexure 2 of its Closing Submissions, that 'V601 carefully performance managed the Project Manager'. I find that the Project Manager was receptive and amenable to such management by V601, and the inappropriate and undue influence exerted by V601;

(g) As part of the management of, and undue pressure exerted by V601 on the Project Manager, it withheld project management fees in a significant sum which caused financial pressure for First Urban.[270] V601 also issued First Urban with a Notice to Show Cause on 15 June 2012.[271] In the circumstances detailed above, I infer that V601 served this Show Cause Notice on the Project Manager to increase pressure on the Project Manager to accede to V601's requests in relation to the Project Manager's assessment and certification of Probuild's entitlements under the Contract;

(h) It is in my view telling that it was not until early October 2012, when the Project Manager signed a Deed of Variation for Project Management Services with V601, that the Project Manager's outstanding fees were brought up to date by V601.[272] Further, I note that, only weeks earlier, after a drawn out process, the Project Manager finally determined Probuild's EOT2A and EOT3 claims;

(i) I consider that the pressures which V601 applied to Probuild were orchestrated by V601 with the intention of pressuring the Project Manager to co-operate and work with V601 to delay and minimise the certification of Probuild's time extension and delay cost entitlements;

(j) The Project Manager worked as part of V601's claims response team, including in relation to the Project Manager's assessment and certification functions;

(k) I also infer from the extensive degree to which V601 failed to make timely discovery of a large number of documents relating to the Project Manager's assessment and certification functions, and the extensive degree to which V601 strenuously contested that those documents were subject to privilege, that V601 was motivated by concern that such communications would prove to be harmful to V601's case, and to the maintenance of the Project Manager's claim of independence in relation to its assessment and certification functions under the Contract. V601's claims of privilege were ultimately, in the overwhelming majority of cases, ruled to be unsubstantiated;

(l) As earlier concluded and found, the Project Manager actively and cooperatively worked with the V601 claims response team to formulate and implement V601's strategy, including in relation to addressing Probuild's EOT2 and EOT3, with the Project Manager issuing draft determinations that the Principal deployed in its attempts to delay certification, so as to negotiate what it considered to be a satisfactory financial outcome with Probuild on those claims;[273]

(m) The Project Manager was not even-handed in his treatment of V601 and Probuild, including in the way that the Project Manager received and considered materials and communications relevant to Probuild's time extension and delay cost entitlements, and relevant to the Project Manager's performance of its independent assessment and certification functions under cl 20.2 of the Contract. Without involving or informing Probuild, the Project Manager discussed, and received materials directed to defeating and minimising Probuild's claim entitlements, with V601's partisan consultants and its lawyers in a process that was generally intended to defeat, or diminish, Probuild's contractual claims but did not inform Probuild of such activities or provide Probuild with the time extension claim related materials which challenged Probuild's claims, so as to provide it with an opportunity to answer the contradictory material, and which might affect its entitlements as considered by the Project Manager, or otherwise involve Probuild in this process;

(n) The Project Manager arranged for TBH's engagement and involvement in the extension of time analysis and assessment, and did so as part of V601's strategy and tactics to delay and minimise the Project Manager's certification of Probuild's contractual entitlements, and to bolster V601's position in relation to Probuild's delay claims.[274]

403 For the above reasons, I conclude and find that:

(a) V601's argument that the onus would be reversed if it were to engage directly with Probuild's detailed case and submissions[275] that the Project Manager lacked independence is rejected, as is any suggestion that V601 has good reason not to fully respond to Probuild's detailed case on the contractually wrongful conduct of the Project Manager.

(b) The Project Manager's conduct in relation to its contractual role as assessor and certifier lacked the required level of independence and constituted a breach of cl 20.2 of the Contract from near the outset of the Precinct Project, because through its officers:

(i) it failed to appreciate the standard of independence and conduct required of its role as assessor and certifier; and

(ii) it allowed its processes of assessment, determination, and certification of Probuild's contractual entitlements to be unduly and inappropriately influenced by V601's strategies and tactics, as well as V601's commercial interests.

(c) In relation to the last preceding subparagraph, I am comfortably satisfied that the Project Manager was not independent and impartial, nor was it impartial, fair, and reasonable in its assessment and certification of Probuild's extension of time claims, and of Probuild's contractual entitlements to extensions of time and delay damages.

(d) My conclusions and findings regarding the Project Manager's lack of independence and breach of cl 20.2 are principally based on, and comfortably satisfied by, the establishment of the first nine heads of indicia articulated in Annexure 2 to Probuild's submissions, as well as the additional findings made in respect of the Project Manager's evidence, which are outlined below.

(e) As a result of my above conclusions and findings, it is unnecessary for me to deal individually and in detail with each of the remaining indicia numbered 10 to 33 detailed in Probuild's Annexure 2; save to confirm that I am also satisfied that the further Annexure 2 indicia numbered 10 to 33 (inclusive) detailed in Probuild's Annexure 2 are also made out on the evidence particularised by Probuild in respect of each of the said indicia in Annexure 2. Furthermore, the establishment of each of those additional indicia are individually and cumulatively sufficient to establish that the Project Manager lacked independence and impartiality in its role and also to impugn the Project Manager and justify setting aside all its assessments, determinations, and certifications under the Contract which are in issue; and in addition, provide a basis for my finding that the Project Manager failed to perform its assessment and certification functions under the Contract with the required degree of independence and impartiality in a fair and reasonable manner and in accordance with the express requirements of the Contract and without regard for V601's commercial interests.

(f) I am comfortably satisfied that the Project Manager and V601 collaborated on a strategy regarding Probuild's claims for extensions of time, which involved the Project Manager sending draft determinations to V601 for review and comment, following which the draft determination would be sent to Probuild. I am also comfortably satisfied that V601, in collaboration with the Project Manager, implemented this process so as to provide an opportunity for V601 to negotiate the final determination with Probuild, in order to achieve the best outcome for V601. In this respect, the Project Manager's conduct also delayed the determination of Probuild's contractual entitlements, an example of which is the process followed in relation to EOT2. The Project Manager was unable, via Nave's evidence, to provide a satisfactory explanation as to why it was appropriate to send the draft EOT2 determination to V601 for its consideration, instead of determining and communicating a clear, unequivocal decision on the claim to Probuild. In my view, the email communications concerning the draft EOT2 determination, which are outlined above, reflect the nature of the collusion and cooperation between the Project Manager and V601 in this regard, as well as the Project Manager's willingness to obtain V601's input and approval of draft assessments and determinations in relation to Probuild's contractual entitlement to time extensions, before communicating them to Probuild.

(g) Given their content, it was inappropriate for V601 to send the communications referred to in the last preceding subparagraph, and other similar communications relating to the Project Manager's independent assessment and certification functions, to the Project Manager. The Project Manager's willingness to seek such input and approval is underscored by the absence of contemporaneous communications from the Project Manager objecting to or attempting to distance itself from the strategy proposed in the V601 email communications. In this respect, I am satisfied that the fact the Project Manager did not take issue with the above mentioned manner in which V601 was communicating with it further demonstrates that V601 and the Project Manager were working in concert to plan and implement strategies and tactics regarding Probuild's extension of time claims, including EOT1 and EOT2, with a view to defeating or minimising Probuild's entitlement, and so as to financially advantage V601.

(h) Further, I am satisfied that the strategies and tactics and impugned conduct of both V601 and the Project Manager outlined above extended to Probuild's extension of time and delay damages claims more generally. In respect of EOT2A and EOT3, communications of a similarly inappropriate nature were exchanged between V601 and the Project Manager, and I consider that those communications also sought to influence the Project Manager in relation to its assessment and certification of Probuild's extension of time claims. The Project Manager's ongoing failure to understand that such communications were inappropriate, when it should very promptly have come to this realisation, and the absence of any objections to the strategies and tactics V601 sought to employ, from about the time of the first of Probuild's time extension claims under cl 34 of the Contract, reflects both a lack of fundamental understanding by Nave as Project Manager regarding the independence associated with the role of assessor and certifier under the Contract, as well as evincing an actual lack of independence on the part of Nave and the entity which was the Project Manager.

(i) The EOT2A and EOT3 communications also reflect V601's inappropriate and contractually wrongful conduct in enlisting the Project Manager as part of a contract claims 'team' to advantage V601 in respect of Probuild's claims under the Contract. I am satisfied that V601 and its advisers, including its lawyers, together with the Project Manager, were actively collaborating as a team to implement a collective strategy to delay and reduce Probuild's entitlements to extensions of time and delay damages, so as to thereby maximise V601's ability to achieve the most favourable commercial outcome, vis à vis Probuild, in relation to such claims. I also find that this contractually wrongful collaboration was occurring from, at least, the time when Probuild submitted the first EOT2 claim.

(j) The Project Manager participated in meetings of an inappropriate nature, including the meeting on 1 May 2012 (detailed above) to discuss Probuild's EOTs and delay damages, with V601's representatives and members of V601's contract claims team, including its lawyers. The 1 May 2012 meeting covered, inter alia, the engagement of an independent programmer to assist with developing V601's counter-arguments to Probuild's claims; a directive by V601 that the Project Manager was to be more aggressive in its communications to Probuild seeking documents and evidence; and discussed conclusions on delay in relation to EOT2. Given the nature of the matters discussed, in my view, the Project Manager's active participation in this meeting was very inappropriate, and provides a further example of Nave as the Project Manager failing to appreciate the contractual obligations of independence and impartiality in the assessment and certification of the Contractor's claims. In failing to object to, or distance itself from, attendance and participation in meetings such as that on 1 May 2012, and in failing to conduct himself in such a way as to avoid undue influence exerted by V601, the conduct of Nave and the Project Manager exhibited both a profound lack of required independence and also, I consider, as earlier alluded to, a lack of fundamental understanding of those aspects of the contractual role that, as Project Manager, he was charged with as assessor and certifier.

(k) I also find V601 in breach of its express and implied obligations not to interfere with or direct the Project Manager in the performance of its role as independent assessor and certifier.

(l) From about March 2012, I am satisfied that V601 substantially increased its influence and the pressure on the Project Manager, with the objective of having the Project Manager address and determine Probuild's extension of time and related claims as slowly as possible, in order to favour V601. This was achieved, inter alia, by appointing the company of which Chryssafis was managing director to oversee the Project Manager, and to provide input to the Project Manager in relation to the assessment and certification of Probuild's extension of time claims. Under cross-examination, the Project Manager did not deny that he was receiving pressure from Chryssafis.

(m) Other forms of influence and pressure applied by V601 to the Project Manager, in its role as assessor and certifier of Probuild's extension of time and related claims, included review of the Project Manager's draft response to Probuild's façade variation claim by V601's lawyers. After this review, the Project Manager's response was then sent to Probuild in substantially the same form as the version containing the suggested amendments originating from V601's lawyers; V601 together with its lawyers issued a directive that a TBH report should not be provided to Probuild in order to preserve privilege, and that the response bear no reference to a relevant TBH report or TBH's input in relation to Probuild's subject time extension claims. V601's lawyers did however appropriately remind the Project Manager that the determination should be based on the Project Manager's 'own assessment'.

(n) At a meeting on 7 August 2012 attended by V601, its lawyers, and TBH, at which the Project Manager was present, and an active participant, references were made to, inter alia, V601 not having sufficient funds to pay Probuild's claim; possible weaknesses in relation to a potential claim by Probuild in respect of Building D; the Financier withholding funds from V601 (Mario); and strategies to assist V601 in resolving Probuild's extension of time claims pending the Project Manager's assessment.

(o) I am satisfied that the communications between V601, its lawyers, TBH, and the Project Manager establish that the Project Manager was part of a contractual claims response team assembled by V601 to develop and implement a strategy and apply tactics to delay, defeat, or minimise Probuild's entitlements to extensions of time and delay damages. This strategy involved enlisting the Project Manager to assist with developing and implementing the strategy, as well as applying pressure to the Project Manager to deal with Probuild's claims in a way that assisted V601 and its commercial interests.

(p) I am satisfied that, at the meetings involving the contractual claims response team, the Project Manager was placed under inappropriate and considerable undue influence from V601 and its advisers to delay and minimise certification of Probuild's contractual entitlements to time extensions and delay damages and thereby to financially advantage V601. I am comfortably satisfied that, early in the Project, the Project Manager succumbed to the inappropriate and considerable undue influence and pressure exerted by V601 and its advisers to delay decisions, or minimise, or defeat, if possible, Probuild's contractual entitlements to extensions of time and delay damages.

(q) In relation to the above findings and conclusions, I am also comfortably satisfied that the Project Manager failed to properly understand that its contractual role as assessor and certifier required unwaveringly independent, impartial, fair and reasonable conduct, in accordance with the express requirements of the Contract, and without regard for the commercial interests of either party to the Contract. I am also comfortably satisfied that the Project Manager willingly participated as part of the V601 contractual claims response team. This included providing draft assessments of Probuild's claims to the V601 team for comments and suggestions and acceding to requested amendments to the Project Manager's assessments, before issuing such assessments to Probuild.

(r) In my view, the degree to which the Project Manager was drawn into and enmeshed in the V601 contractual claims response team is reflected by Nave, and through him the Project Manager's, actions in immediately seeking advice from V601's lawyers when Probuild issued a Notice of Dispute alleging that the Project Manager had not acted independently in relation to Probuild's extension of time claims. This is further evidence of the Project Manager failing to appreciate the nature and extent of the obligations of an independent and impartial assessor and certifier, and the way in which such an assessor and certifier should independently and impartially conduct themselves. It also reflects the degree to which the Project Manager had become accustomed to dealing with V601's lawyers directly.

For the above reasons, I also conclude and find that the Project Manager failed to assess, determine and certify Probuild's extension of time and delay damages claims independently, impartially, and in a fair and reasonable manner, in accordance with the express terms of the Contract, including cls 32.3, 34.3, 34.4, 34.5, and 34.9, or assess, determine and certify Liquidated Damages independently, impartially and in a fair and reasonable manner in accordance with cl 34.7 or in accordance with cls 20.2(a) and 20.2(b) of the Contract, and I find that the Project Manager breached its obligations in relation to the requirements of the Contract referred to in each of those clauses of the Contract, in each of those respects.

404 Further, including for the above reasons, I conclude and find that V601 was in breach of the Contract:

(a) in not extending Probuild's contractual time for performance of Separable Portions 1, 3, 4, 5, 6, 6A, and 7, in accordance with Probuild's time extension entitlements;

(b) in not compensating Probuild in relation to its delay damages entitlements associated with Probuild's time extension entitlements;

(c) by procuring, encouraging and collaborating with the Project Manager in respect of the Project Manager's above identified failures to comply with its contractual obligations and duties.

405 Further, in relation to the above conclusions, I add that I reject V601's submission that there are no material facts pleaded by Probuild which can found breaches of the Contract by V601, based on the Project Manager's failure to act independently, and otherwise in accordance with its obligations under cls 20.2, 32.3, and 34 of the Contract to approve the Contractor program and to grant extensions of time to which Probuild was entitled, and to award delay costs as required by the Contract and to act independently.

406 I am satisfied, for the reasons which follow, that Probuild is entitled to, and has succeeded in establishing, the time extension and delay damages claims it has advanced in this proceeding.

407 V601 has contended that the Project Manager dealt with Probuild's time extension claims pursuant to the discretion provided by cl 34.5(b) of the Contract, because the Project Manager could not assess whether delays were on the critical path under cl 34(b)(ii), as a result, V601 asserts, of Probuild failing or neglecting to submit compliant Contractor's Programs for approval.

408 I have rejected V601's allegation and assertions that Probuild did not provide compliant Contractor's Programs for the Project Manager's approval, and I have found that the Project Manager, in breach of cl 32 of the Contract, failed to approve Probuild's updated Contractor's Programs and that the Project Manager in substance and in breach of the Contract prevented Probuild from being able to base its time extension claims on an Approved Contractor's Program. Concomitantly, I also:

(a) reject V601's assertion that, because the Project Manager was, in the circumstances, empowered or entitled to direct extensions of time under cl 34.5(b) of the Contract, it is irrelevant therefore whether the Project Manager lacked independence or was in breach of cl 20.2 of the Contract; and

(b) find that V601, by its Project Manager, breached cls 34.4, 34.5(b), and 34.9 of the Contract in failing to certify the extensions of time and the delay damages declared and awarded to Probuild by this judgment, and by purporting to direct pursuant to cl 34.5(b) when it was obliged to address and determine the relevant extension of time claims under cls 34.3, 34.4, and 34.5(a) of the Contract.

Further relevant concerns and criticisms of the Project Manager

409 I also highlight that, in my view, V601's submissions do not present any detail or developed argument that the Project Manager did, in fact, act independently in relation to his assessment and certifying role under the Contract, save that in oral closing submissions, V601 attempted to reference limited instances of conduct by the Project Manager which V601 asserted displayed an independent approach to the Project Manager's duties under the Contract. However, for the reasons I have outlined, I am wholly persuaded to the contrary.

410 Further, I am not satisfied that the abovementioned instances of conduct on the part of the Project Manager, cited by V601, are sufficient to displace or change the character of the very large body of uncontradicted evidence which I consider establishes that the Project Manager failed to perform its assessment and certification functions with the required degree of independence, impartiality, fairness, and reasonableness, and in accordance with the contractual requirements with which it was charged, and with no regard for V601's commercial interests.

411 More specifically, for the reasons outlined below, I find that the evidence contradicts V601's submission that it supported the Project Manager taking an independent approach to its assessment and certifying role under the Contract.

(a) Where V601 relies on Nave having disagreed with TBH's report dated 9 August 2012.[276]

On 15 August 2012, Nave signed a determination adopting TBH's analysis. Nave's evidence was that he did not provide this determination to V601 because he was not satisfied that it was accurate. I reject that evidence. Nave's determination was sent to V601 on 7 September 2012.[277]

(b) Where V601 submits that Nave properly assessed Probuild's EOT2A and 3 claims, basing his determination on TBH's Report dated 7 September 2012 with some adjustments to that Report, where he disagreed with it.[278] More accurately, I consider the adjustments referred to by Nave merely corrected certain arithmetic errors.[279] In the vast majority of instances, the Project Manager just adopted TBH's findings.

(c) TBH was engaged to assist V601 and the Project Manager to defeat or reduce Probuild's contractual time extension claims. The Project Manager colluded with V601 and its claims response team, including V601's lawyers, to devise and implement a strategy to ultimately achieve a favourable commercial outcome for V601. TBH participated in that process, including by attending meetings with V601, its lawyers, and the Project Manager.[280] I consider that TBH's 7 September 2012 Report was part of that strategy and that Report formed the basis of the Project Manager's determination. I am satisfied for these reasons that TBH's involvement cannot be accurately characterised as intended to assist the Project Manager by providing impartial assistance from an independent programmer.[281]

I note, however, in relation to this aspect, and other observations that I have made regarding TBH, that although I am most critical of V601 and the Project Manager in relation to the manner in which they conducted themselves and enlisted their consultants in relation to Probuild's extension of time claims, and Probuild's time extension and delay cost entitlements, I intend and make no criticism of TBH itself in relation to its involvement, or for undertaking the work that it carried out; nor do I intend any criticism of Baker McKenzie, or its lawyers, in relation to their involvement on behalf of their client or for the legal work which they undertook for V601.

General conclusion as to difficulties created by V601 for Probuild

412 I have concluded and found that the Project Manager failed to perform its assessor and certifier role in an independent manner as required by the Contract, and that V601 actively collaborated and cooperated with the Project Manager to those ends.

413 I add that this crucial aspect of the way in which the Contract and the WUC were administered (using the word administered as a convenient general descriptor to include the activities of the Project Manager in relation to its assessment and certification role) largely occurred during a time when the Contractor and V601 were at loggerheads with each other in relation to the Contractor's rights and entitlements, and many other aspects of the Contract and Project.[282] This I consider had a toxic influence on the Project. I am satisfied that in the result, Probuild both encountered delay as a result of latent condition and variation works ordered by V601 and V601's indecision and self-serving commercial tactics, which were exacerbated by the conduct of the Project Manager.

414 I make the further general observation that the evidence demonstrates that V601 was at least a difficult principal. From the outset of the Project, it appears to have set out to control the Project Manager and to have it discharge its functions in favour of V601's commercial interests, including those functions required to be undertaken with independence and impartiality.

415 Further, during much of the Project, V601 created considerable difficulties for the Contractor because it often did not issue timely instructions and make timely decisions; a difficulty for Probuild which was exacerbated in the Project and contractual context by such problems not being addressed, as they should have been, by a Project Manager acting independently, impartially, fairly, and reasonably as required by the Contract.

416 Both Probuild, the claimant Contractor seeking extensions of time and other entitlements, and the Principal, V601, rely on expert programming evidence as part of their respective cases in relation to Probuild's claim for entitlements to extensions of time under cl 34 of the Contract.

417 Pursuant to cl 34.4(b) of the Contract, Probuild is entitled to an extension of time if:

(a) Probuild has made a claim in accordance with cl 34.3 of the Contract;

(b) the delay relied upon to found the Contractor's claim has affected an activity which is, in the reasonable opinion of the Project Manager, on the critical path of the Approved Contractor's Program as it existed at the time of delay; and

(c) Probuild has taken all reasonable measures to prelude the occurrence of the relevant delay and to minimise the delay, including resequencing and reprogramming the performance of WUC where it is reasonably practical to do so.

418 In relation to the programming analysis of delay, Probuild principally relies on the expert evidence of Lyall, and V601 principally relies on the expert evidence of Abbott. V601 also relies upon the expert evidence of Abbott in relation to the reasonable measures a contractor in Probuild's position would take to preclude and/or minimise delay, and Probuild relies upon the expert evidence of Peter Picking in relation to this aspect of the parties' cases. Lyall also addresses avoidance and mitigation of delays by Probuild.

419 Both V601 and Probuild argued to have the opposing programming expert witness's evidence rejected because that evidence is asserted to be inadmissible. Similarly, on the basis of asserted deficiencies with the other parties' programming evidence, each party submits the opposing party's expert evidence is at least unpersuasive.

420 Furthermore, V601's programming expert, Abbott, and Probuild's Programming Expert, Lyall, each approach their analysis of delay utilising distinctly different methodologies.

421 Lyall opines that a 'retrospective' method of analysis of delay is more appropriate to determine the actual extent of the delays at issue under the Contract.

422 Abbott opines that the preferable method of delay analysis in the context of the Contract, in relation to the delays at issue, is by means of a 'prospective' delay analysis.

423 V601, and Abbott, argue that cl 34 of the Contract requires a prospective delay analysis based on the critical path of the Approved Contractor's Program. V601 further submits that Probuild has elected to plead its time extension claims entitlement on the prospective Approved Contractor's Program and should not be permitted to rely on Lyall's 'as programmed/as built' windows analysis.

V601's criticisms of Lyall - objections to Probuild's delay-related expert evidence

424 More specifically V601 argues that Lyall's expert evidence should be rejected, because Lyall:

(i) V601 highlight that although Lyall was initially requested to prepare an expert report setting out his opinion as to whether Probuild's claimed delays affected an activity which was on the critical path of the Approved Contractor's Program, as it existed at the time of delay,[283] Lyall ultimately found that in his view it was not possible to prepare a Report based on the Approved Contractor's Program because no such program appeared to exist.[284] Accordingly, Lyall's evidence was that he considered the options analysing the relevant delays and came to the view that the most appropriate and accurate analysis of the delays in issue was a retrospective 'as-programmed as-built windows analysis'.[285]

(ii) V601 acknowledges that Lyall was instructed to establish a critical path using an as-programmed as-built windows analysis and provide his opinion on whether the delay events referred to in Probuild's extension of time claims caused delay to the critical path which, by this sort of analysis, he identified.[286]

(iii) V601 contend that the above circumstance raises an issue as to whether Lyall failed to disclose that he was unable to find or establish an Approved Contractor's Program at the date of the relevant delay events. V601 contend that if Lyall could not do so, that would support V601's assertion that the Programs supplied by Probuild to the Project Manager in support of time extension claims were not, and could not be, Approved Contractor's Programs. V601 also asserts that evidence of this nature from Lyall would undermine Probuild's case that the PCG programs were, or should have been, Approved Contractor's Programs for the purposes of cl 34 of the Contract.

(iv) V601 also submits that Lyall failed to disclose that he had advised those instructing him that he could create a claim for them based on an as-programmed as-built windows analysis and that he had received oral instructions to prepare a critical path analysis on this basis. V601 asserts that this both affects Lyall's credit and his claim to be an independent expert before the Court.[287] V601 add that Lyall failed to disclose that all of his reports arose 'out of these subsequent oral instructions'.

(v) V601 also asserts that Lyall acted as Probuild's adviser regarding the best basis for formulating its claims and that Lyall 'argued' in favour of those claims at trial, and therefore Lyall did not have the characteristics of independence required of an expert under the Court's Expert Protocol and his evidence cannot be admitted.[288]

V601 also complains that Lyall sought to opine on ultimate issues of fact and law which are matters for the Court;

(vi) V601 complains that Lyall has evaluated the relevant evidence and drawn factual conclusions rather than relying on assumptions that could then be the subject of proof by Probuild.[289]

(vii) V601 submits that Lyall makes expert findings of fact, as well as providing his expert opinion,, which V601 contends reverses the onus of proof requiring it to disprove Lyall's factual findings.

(viii) V601 further submits that Lyall's initial view that he could not perform a delay analysis, based on the Approved Contractor's Program, resulted in Lyall recommending that the most suitable delay analysis he could undertake was that of a retrospective as-programmed as-built windows analysis. V601 contends that Lyall's recommendation was 'guided at least in part by his interpretation of cl 34' of the Contract.[290]

(ix) V601 asserts that Lyall's instructions amounted to him being told to make any assumptions about the facts of the case.

(x) V601 asserts that Lyall's evidence does not identify his reasoning in relying upon particular evidence or his reasoning in rejecting other evidence, and that it would prejudice V601 to have to address all these aspects in cross-examination of Lyall.

(xi) V601 add that Lyall has no expertise in assessing the evidence, which is the Court's function.[291]

(xii) V601 refers to an example - EOT3 - where the only issue in dispute is when the delay started. This factual dispute, V601 claims, is not sought to be proved by Probuild establishing the fact of the commencement of delay, but rather Probuild relying upon Lyall's factual conclusion that the EOT3 delay commenced on 5 April 2012.[292]

(b) his analysis utilises programs which were not agreed by the parties to be binding in relation to the Work or are otherwise inappropriate bases for delay analysis;

(xiii) As an example of this V601 refers to CN19, which V601 claims Lyall uses as his counter factual analysis to confirm that his retrospective analysis is reasonable. CN19 is dated 12 November 2012 and is included in the Glazing Subcontract for the subject Project.

(xiv) V601 asserts that Lyall has based his assessments on his conclusion that the Programs provided to him by Probuild were unreliable and accordingly has adopted a critical path analysis in the nature of an actual as built critical path of the WUC. V601 points out that, in order to demonstrate that his as-built critical path is reasonable and grounded in reality, Lyall undertakes a counterfactual, retrospective analysis utilising program CN19. V601 argues that Lyall has therefore assumed that Probuild was both planning and capable of performing the WUC in accordance with CN19; however, there is no evidence to prove that assumption is correct.

(xv) V601 also asserts that if Lyall had used the November PCG Program or the 11 November 2012 Program, he would not have been able to conclude that his retrospective analysis was grounded in reality because the 'figures' would have been significantly different.[293] Therefore Probuild's unilaterally determined Program can be seen to be unreliable.

(xvi) V601 notes that Lyall was not provided with the Hinds Blunden Programs upon which the PCG Programs of Probuild were based. Bready's evidence was that the PCG Programs, based on soft copy programs developed by Hinds Blunden, were programs intended to allow Probuild to track actual progress against planned dates, in effect, as an as-built record of the Project.[294]

(c) V601 asserts that Lyall was not given key documents resulting in fundamental errors in his 'findings of fact'. This, V601 submits, includes approved drawings showing post tensioning strands between slabs G10 and G15, and the plans and permits setting out crane locations in relation to the basement slabs that were the subject of EOT3. V601's proposition is that Lyall was not provided with such documents and therefore there are fundamental errors in his 'findings of fact'.[295] V601 adds that this and other issues demonstrate that Lyall's evidence should be given little weight.[296]

425 V601 submits that in the event the Court does not reject Lyall's expert reports, those reports should be given less weight.[297]

Considerations/conclusions - Lyall's expert evidence

Lyall's expert evidence is admissible and persuasive

(a) I do not consider that Lyall's evidence is rendered inadmissible, or that it is undermined and of less probative value and/or weight, because of the evolution of the instructions he received after he commenced to interrogate the matters raised in his initial brief and came to the conclusion that it was not, in his view, possible to base his delay report on the Approved Contractor's Program - as it appeared that the only program which was nominally of this description is the program at Appendix 5A of the Contract (entitled 546 CP02) which is a rolled-up, elementary program, in pdf and not in electronic format, and unsuitable for use as a baseline program for the purpose of the analysis of delay to the WUC.

(b) I consider that the evolution of Lyall's instructions reveal the practical and sensible development of an analysis by Lyall in the nature of a retrospective as-programmed as-built windows analysis.

(c) Further, I am also satisfied that the effect of the Project Manager's failure to carry out its obligations pursuant to cl 32.3 of the Contract prevented Probuild, as Contractor, developing an Approved Contractor's Program and updated versions of the Approved Contractor's Program (approved from time to time by the Project Manager) pursuant to cl 32, as contemplated under cl 34.4(b)(ii) of the Contract.

(d) For the same above reasons, I reject V601's argument that Lyall inverted the process by using his specialised knowledge to identify the questions which should have been asked by those who engaged him.

(e) I also reject as a mischaracterisation of Lyall's conduct, that Lyall either advised in the role of an advocate for Probuild or advocated the case that he formulated for Probuild. I consider that Lyall did no more than appropriately and effectively identify how best, on the balance of probabilities, he could analyse the critical path from time to time and the delays which in fact beset the Project. I am also satisfied that Lyall approached and undertook his role as expert witness in this proceeding in compliance with Order 44 of the Rules of this Court.

426 I am not persuaded that Lyall inappropriately drew factual conclusions. I consider that Lyall's evidence was in the nature of admissible expert opinion, drawing on instructed facts and stated assumption. As earlier outlined, Lyall defined the sources of the instructed facts and assumptions he utilised.

427 In relation to EOT3, in my view, Lyall permissibly drew on a number of instructed facts and circumstances, including construction constraints on site in arriving at his opinion in relation to likely commencement of delay. In this regard, Lyall's analysis and the basis of his expert opinion that Probuild's EOT3 delay commenced on 5 April 2012 is addressed in more detail in relation to EOT3 below.

428 I am also unpersuaded that Lyall inappropriately sought to interpret provisions of the Contract, for example cl 34. Insofar as Lyall disclosed how he had taken into account aspects of the way in which cl 34 of the Contract appeared to operate, in my view, Lyall did so appropriately and in a manner which was necessary for an expert in Lyall's position as a result of his need to explain how he undertook his analysis, and necessarily that explanation I consider must reflect the expert's understanding of how the Contract provisions operate in relation to the assessment of compensable delay. This I consider formed a component of the reasoning of the programming and time extension expert which the expert is obligated to disclose.

429 I also record in this regard, that as also earlier outlined, I consider that Lyall adequately explained the reasoning which led to his expert conclusions in every required respect in my view.

430 Further, in relation to Lyall's use of Program CN-19, I note that Abbott substantially agreed with the appropriateness of the use of that program by Lyall.[298]

431 Further, I am not persuaded that Lyall was not provided with the key document necessary for his analysis, nor am I persuaded that Lyall was provided with unreliable PCG programs, and finally I am not persuaded that these, or any other materials or matters, resulted in any fundamental errors in relation to Lyall's opinions.

432 I reject V601's assertion that Lyall received oral instructions and as a result there was uncertainty as to the construction and assumptions to which Lyall proceeded to propound in his Lyall First Report. I am satisfied that Lyall's instructions contained in Appendix B of the Lyall First Report are comprehensively identified and that V601's further contention that Lyall was given no defined assumptions is incorrect. The letters of instruction dated 23 December 2016 and 16 February 2017 at Appendix B of the Lyall First Report of 12 April 2018 contradict V601's contention. Further, as Probuild note in the Probuild Further Reply Closing Submissions, V601 did not put to Lyall that he received 'oral instructions', or material other than the material identified in Appendix B of the Lyall First Report. For these reasons, I reject V601's assertion that Lyall either acted inconsistently with his instructions or that he received 'oral instructions' which were not able to be identified in relation to his reports and which impugned his process and his conclusions.

433 I also reject V601's assertions to the effect that Lyall was tasked with and adopted the role of a 'finder of fact'.[299] There is no evidence in my view which I consider establishes this assertion by V601.

434 Nor am I persuaded, as V601 asserts, that Probuild failed to provide certain programs to the Project Manager because Probuild did not want its claims assessed against 'the contract program'.[300] Probuild did in fact submit programs which were in my view both adequate and contemporaneous.[301]

435 Lyall used WUCP01 as a 'baseline program' and developed the 'as-planned' delay analysis from that baseline program.[302] Lyall also commenced his analysis by using the WUCP01 program and other information, which he identifies, to locate the critical path of his 'as-built' analysis of delay, in relation to which Lyall analyses Probuild's time extension claims.[303]

436 However, I accept Lyall's expert evidence that the Appendix 5A Contract program was unsuitable as a tool to assess delay in relation to the project for reasons including:[304]

As there were no further programmes approved, it is my view that by the time the WUC started, the Approved Contractor's Program in Appendix 5A of the Contract no longer reflected the plan to Completion of each Separable Portion. The Appendix 5A programme was out of date when the WUC works commenced, and to produce any sensible analysis this programme would have had to have been updated to reflect the actual start of the works on site. This is what both Mr Abbott and I have done to provide baselines for our analyses. The Appendix 5A programme does not show the level of detail that would be necessary for a forensic analysis as it is only a paper copy and not an electronic file.

437 Further the programming experts ultimately agreed, as reflected in the Programming Expert's Joint Report 2 at [2], that:

The Approved Contractor's Program is bound into the Contract and labelled 546 CP02 (Approved Contractor's Program). No exactly matching electronic file has been found of the Approved Contractor's Program. The hard copy program bound in the Contract at Appendix 5A is a hard copy rolled-up summary program with approximately 300 activities. The soft copy programs used by the Experts contains approximately 3,500 activities. 546 CP02 is an electronic file that was created some time in September 2011. WUCP01 is an electronic file that was created in September 2011. Neither 546 CP02 used by Mr Abbott in soft copy (Abbott's Baseline) nor WUCP01 used by Mr Lyall (Lyall's Baseline) exactly match the Approved Contractor's Program in hard copy) There is very little difference between Abbott's Baseline and Lyall's Baseline from an analysis point of view. The Experts agree that either program is a program that could be considered as an appropriate baseline program for determining delay. There are minor variances on the dates for the activities between the Approved Contractor's Programs and the Lyall Baseline and the Abbott Baseline.

438 Furthermore I also accept that, as at 18 April 2011, the planned sequence of work and durations shown on the WUCP01 program were reasonable and achievable.[305]

Failure by Probuild to submit Contractor's Programs

439 V601 also contends that, if it is established that cl 34 of the Contract is unworkable, this is because Probuild failed to submit Contractor's updated programs as required by cl 32 of the Contract; V601 adds that Probuild cannot now rely on a lack of Approved Contractor's Programs to found any of its claims.

440 V601 notes that by its pleading, Probuild relies upon 25 'updated' Contractor's Programs (PCG Programs) which were submitted to the Project Manager for approval. Probuild's case is that these are Approved Contractor's Programs or alternatively the Project Manager's failure to approve them was a breach of Contract.[306]

441 V601 contends that contrary to its pleaded case, Probuild now argues:[307]

(a) there were in fact no Approved Contractor's Programs against which extension of time claims under the Contract could be assessed;

(b) therefore it is necessary for Probuild to rely upon alternative programming analysis to establish its extension of time entitlements; and

(c) if cl 34 of the Contract is held not to permit the utilisation of alternative programming analysis then the prevention principle is engaged and time under the Contract is at large.[308]

442 V601 also submits that it follows from Probuild's argument that there were no Approved Contractor's Programs, as Probuild recognises that the PCG Programs it relied upon in its claims to the Project Manager were not Approved Contractor's Programs.

443 Bready gave evidence that the PCG Programs prepared by him followed the rolled up format of the 5A Program.[309] The uncontradicted evidence of both Nave and Lyall was that the PCG Programs could not be used to analyse Probuild's claims to any extension of time. V601 submits that as a consequence, Probuild's pleaded case must fail.

444 V601 contends that Probuild has elected to plead its case based on the Approved Contractor's Program and has in effect abandoned and rendered irrelevant an analysis based on an 'as-programmed as-built windows assessment' by Lyall.[310] I reject this assertion.

445 I consider that although, as the Contract, in particular the terms of cl 34 stipulate, the parties at contract contemplated that the criticality of delay would be informed by reference to the Approved Contractor's Program and Probuild's pleaded case reflected this position. Probuild's case included that the Project Manager had prevented Probuild from relying on Contractor's Programs which were approved by the Project Manager under the Contract, and therefore Probuild, by lay and expert evidence and submissions, sought to prove relevant delay based on its updated Contractor's Programs and Lyall's evidence as to the most accurate and reliable means of determining critical delay, as contemplated by the Contract. Furthermore, V601 responded to this case by Probuild.

446 Lyall's analysis using WUCP01 (18 April 2011) accords in substance with Probuild's case as pleaded, based on the Approved Contractor's Program.[311]

447 Finally, I note that V601 ultimately accepted that Lyall's delay analysis utilising the WUCP01 program was appropriate and correct.[312]

448 V601 also argues that Probuild cannot benefit by its own wrong in not maintaining a soft copy 5A Program, or providing appropriate updated Contractor's Programs to the Project Manager for approval, to argue that because there was no Approved Contractor's Program it was entitled to rely upon Lyall's alternative analysis; and if it is not entitled to rely upon Lyall's alternative analysis, to rely on the prevention principle under the Contract, namely, that if no workable extension of time regime existed under the Contract, time completion is set at large.[313] I also reject this argument by V601. For reasons I refer to above and elsewhere, I find no relevant breach or 'wrong' perpetrated by Probuild, including in relation to any failure by Probuild to submit electronic programs to the Project Manager.

449 Accordingly, I reject V601's above contentions. I find, for reasons elsewhere outlined, that in breach of the Contract, V601, by its Project Manager, prevented Probuild from relying, under cl 34 of the Contract, on an Approved Contractor's Program by failing and neglecting, and refusing to approve Probuild's Contractor's Programs and updates of Probuild's Contractor's Program, from time to time, pursuant to cl 32.3 of the Contract.

450 I also reject that the extension of time regime under the Contract was unworkable, and in particular, that it was unworkable as a result of Probuild's conduct by electing to pursue its claims based on PCG Programs and/or failing to comply with its obligations to maintain an Approved Contractor's Program; accordingly, I reject that Probuild has denied itself the benefit of cl 34 of the Contract and cannot rely upon the prevention principle.[314] Ultimately, the parties' fundamental contractual intent, in that regard, is that the Contractor shall be entitled to extensions of time where compensable delay has affected critical activities. Probuild's evidence, in particular the evidence of its expert Lyall, has I consider established this in relation to each of Probuild's claimed EOTs.

451 As I have separately outlined, notwithstanding V601 and the Project Manager by their conduct precluding Probuild's reliance on an Approved Contractor's Program, I consider that the Contract's time extension regime remained operative and available.

452 V601 submits that, in certain analogous scenarios, Lyall adopts methodology which results in different assessments for delays; for example, delay caused by Latent Conditions in respect of which subsequent industrial action also caused delay.[315]

453 V601 contends that Lyall's treatment of inclement weather is contradictory to his analysis of other concurrent delays. V601 contends on this basis that such matters undermine the objectivity of Lyall's overall analysis.[316]

Probuild's submissions in relation to the admissibility and weight of Abbott's expert evidence

Probuild's criticisms of V601's programming evidence provided by Abbott

454 V601's programming expert, Abbott, seeks to support a delay analysis methodology based on a prospective delay analysis.[317]

455 Abbott considered that cl 34.3(a) of the Contract required the Contractor to demonstrate its entitlement to claimed extensions of time, on the basis of a prospective analysis of delay to the project works or relevant parts of those works.

456 Abbott acknowledged that his delay analysis methodology was one which, in substance, 'forecast outcome' in relation to the effect of delay on the works.[318]

457 Abbott firmly rejected Lyall's retrospective delay analysis methodology as appropriate or suitable.[319]

Abbott strayed from his discipline as a programming expert and criticised Probuild

458 Probuild submits that Abbott reflected both the degree to which he did not feel constrained to confine his evidence to his relevant area of expertise in these proceedings, and the degree to which he was willing to advocate a case against Probuild by commenting adversely on Probuild's conduct and competence as a Builder.

459 Probuild argues that Abbott did so, for example, in relation to Probuild's handling of the relocation of the access ramp into the site in the early part of the works, criticising Probuild's timing and coordination of orders for acquired trade packages, and what he contended were Probuild's failures in relation to the implementation of steps to mitigate delay arising from soft spots on site and other matters.

460 Probuild also argues that Abbott, in substance, undertook the process of interpreting the Contract and arguing for his interpretation, in particular of cl 34.3 of the Contract as a provision which only permitted the Contractor to demonstrate delay on a prospective delay analysis.[320]

461 Probuild contends that Abbott also, in substance, founded parts of his evidence on his own factual findings; for example, in relation to Probuild's contractual compliance in relation to providing updated programs,[321] and whether or not the Façade Variation was a 'variation' pursuant to the correct interpretation of the Contract, and as a matter of fact.[322]

Considerations/conclusions - Abbott's expert evidence

462 I accept that there were numerous instances where, in his expert evidence, Abbott departed his role as an expert witness and both purported to find facts by which he supported his own opinions, and also purported to interpret the Contract and determine whether it was satisfied in certain respects.

463 In my view, the extent to which Abbott opined on matters outside his relevant expertise as a programming witness, and on a number of occasions did so in respect of issues which were not pleaded by V601, I consider, indicated that Abbott's evidence was to a significant degree motivated by what he considered to be a need to advocate for V601. As a result, I consider that Abbott's evidence on disputed matters should be given less weight for this reason.

464 In Dura (Australia) Constructions Pty Ltd v Hue Boutique Living Pty Ltd (No 3),[323] Dixon J stated:

98. In summary, the matters that will usually be considered at both stages of the inquiry that considers whether the exception under s 79(1) (Evidence Act 2008) renders opinion evidence admissible may conveniently be referred to as four 'rules' (one of which is in three parts), which are:

(a) is the opinion relevant (or of sufficient probative value)[324] (the relevance rule);

(b) has the witness properly based 'specialised knowledge' (the expertise rule);

(c) is the opinion to be propounded 'wholly or substantially based' on specialised knowledge (the expertise basis rule);

(d) is the opinion to be propounded 'wholly or substantially based' on facts assumed or observed that have been, or will be, proved, or more specifically (the factual basis rules):

(i) are the 'facts' and 'assumptions' on which the expert's opinion is founded disclosed (the assumption identification rule);

(ii) is there evidence admitted, or to be admitted before the end of the tendering party's case, capable of proving matters sufficiently similar to the assumptions made by the expert to render the opinion of value (the proof of assumptions rule);

(iii) is there a statement of reasoning showing how the 'facts' and 'assumptions' relate to the opinion stated to reveal that that opinion is based on the expert's specialised knowledge (the statement of reasoning rule)?[325]

465 I consider that Abbott's evidence, in several significant respects, fails to meet the requirement that expert opinion is to be based on relevant programming speciality; and also based on facts either instructed or identified as assumed, and which facts and matters are established by other evidence in this proceeding.

466 Matters addressed by Abbott which I consider were not wholly or substantially within his relevant specialised knowledge, include his views in relation to Probuild's handling of the relocation of the access ramp into the site in the early part of the works, and Probuild's timing and coordination of orders for acquired trade packages, which Abbott contended represented Probuild's failures in relation to the implementation of steps to mitigate delay arising from soft spots on site. Likewise, in this category were his opinions in relation to matters referred to in the last preceding paragraph and also as outlined below.

467 I am also satisfied that a substantial number of communications in the nature of Abbott's instructions and also documentary materials provided to Abbott are not able to be specifically identified as a result of the evolution of his instructions and the materials provided to him.

468 In the Abbott First Report, Appendix A identifies the documents provided to Abbott. By a letter of instruction dated 12 August 2018, Abbott was requested to opine on a number of additional matters. However, Abbott's instructions of 29 August 2018 identified no particular further documentation as being provided to him in respect of the additional matters he had been asked to address.

469 Under cross-examination, Abbott clarified that, in addition to those documents listed and identified in his two reports, further materials provided to him were not exhaustively defined.[326]

470 I am also satisfied that Abbott has not in his Reports precisely identified all the facts and assumptions upon which he relied. In both the Abbott First Report of 12 September 2018 and the Abbott Second Report of 17 October 2018, Abbott on a number of occasions stated that he had reviewed the information available to him that related to delay, and that he had completed his delay analysis drawing on the review of that information.[327]

471 Abbott's statements however often do not identify the information available to him which he reviewed in relation to specific delay claims.

472 Under cross-examination, Abbott acknowledged that he had on occasions not identified contemporaneous records relied upon to form his relevant opinions. Furthermore, at no point did Abbott, in my view, satisfactorily identify how the Court could establish what material was specifically drawn upon as part of his delay analysis, in respect of a number of extension of time claims.[328]

473 Accordingly, in my view, it is not possible with the required degree of confidence for the Court to identify the establishment of all the assumptions and facts upon which Abbott has founded his opinions in relation to delay; nor is it possible, in my view, for the Court to be satisfied that in all instances such assumptions and facts have been sufficiently established by other evidence in this proceeding.

474 I am also persuaded that Abbott's prospective methodology in relation to delay analysis is significantly less reliable, probative and persuasive as outlined elsewhere herein.

475 For the above reasons I find Abbott's analysis and conclusions in relation to all Probuild's extension of time claims in issue to be significantly less persuasive than those of Probuild's expert programming witness, Lyall.

Abbott's criticism of Lyall relying upon programs other than the Approved Contractor's Programs

476 Abbott characterised Lyall's programming and delay analysis evidence as fundamentally flawed, and also unreliable and erroneous.[329] In my view, Abbott's characterisation and the basis he advanced for this conclusion are unjustified and unsubstantiated because the evidence established that there was but one Approved Contractor's Program and that was the program included in the Contract as 'Appendix 5A'.

477 Further, the Approved Contractor's Program, Appendix 5A, I am persuaded was not an adequate or sophisticated enough programming tool for the assessment and quantification of delay of the works, or the Separable Portions of the Works;[330] and was in any event, a program in existence at the time of Contract, and therefore outdated before the commencement of the Works. For example, the Early Works were themselves not brought to completion by the date specified in the Approved Contractor's Program, Appendix 5A.

478 Further, Abbott's criticism of Lyall's analysis based on programs which were not 'Approved Contractor's Programs' is in my view greatly weakened by Abbott relying upon program CP02 in relation to his own delay analysis. I am not satisfied that the CP02 program was accurately described by Abbott as representative of the Approved Contractor's Program in Appendix 5A of the Contract.[331]

479 I am however not satisfied that there is any evidence that in fact CP02 was the Approved Contractor's Program. This assertion or assumption by Abbott is to be contrasted with his evidence that CP02 was a program which reflected a slightly different status to the Approved Contractor's Program.[332] Abbott's evidence was I consider also rendered more equivocal because he stated that the Approved Contractor's Program was not a suitable tool for programming analysis, and therefore it was necessary to identify an appropriate baseline program in other ways.[333]

480 Abbott impugns Lyall's impacted as-planned analysis as being 'speculative, theoretical and divorced from reality' and purely speculative and theoretical, based purely on a mathematical model without any consideration of factual material or actual performance under the Contract.[334] I reject these criticisms of Lyall's impacted as-planned analysis which I have earlier concluded is logical and persuasive.

481 Additionally, in my view, Abbott's analysis utilising a time impact analysis is itself in the nature of a theoretical analysis. For example, as pointed out by Lyall, Abbott's analysis incorporates predictions about the works to be undertaken and how delay will impact those works.[335] This criticism by Lyall was in substance accepted by Abbott in his evidence that the methodology which he, Abbott, had applied produced only a 'forecast outcome'.[336]

482 In the Society of Construction Law Delay Disruption Protocol (2nd ed, 2017) at 11.6(b), the learned authors state that:

The product of this method of analysis is a conclusion as to the likely delay of the modelled delay events on the programme/critical path that is most reflective of the contemporaneous position when the delay events arose. This method does not capture the eventual actual delay caused by the delay events as subsequent progress is not considered.

483 I am satisfied that Abbott's analysis and reports contain material methodological errors which I consider significantly diminish the reliability and weight of his reports. Abbott's methodological errors include Abbott's reliance upon program CP02, notwithstanding the gist of Abbott's following evidence:[337]

WITNESS ABBOTT: Typically that's the only way they get approved and changed. Certainly approved programs don't get changed and then reapproved to accommodate contractor delays.

If there's an EOT that's been approved, it will be inserted into the program, the program rescheduled, then that program's effectively agreed as the revised, um, the revised approved contract is program. That's typically the only time they get changed, unless there is some agreement to change the sequence and timing but ‑ ‑ ‑

HIS HONOUR: But they're not changed on the basis of the delaying effect that is asserted to be the duration of the extension of the activity rather than what the superintendent might have agreed was the period of delay.

WITNESS ABBOTT: I think the only way I can answer that is it's the approved amount.

HIS HONOUR: Yes.

WITNESS ABBOTT: Which probably more times than not both parties won't necessarily agree with. Whatever the approved EOT is, the program is extended by. But I think the important point, and not wanting to complicate, but it is important, an approved contract is program - if an EOT's approved, the program will be, will be effectively rejigged to accommodate the approved EOT and the end date's adjusted accordingly.

But that program still guarantee will not be in sync with what's happening out on the project because this is the approved contract program. This is the contract against which EOTs are assessed, which invariably very, very different to the contractors' target program at the time.

You know, in my experience and my understanding of the operation of contracts, it is simply the structure that you assess EOTs against and ultimately, importantly, assess things like liquidator damages and delay costs and that contract program is typically only adjusted by agreement and that agreement normally, in my experience, comes with approved EOTs.

HIS HONOUR: Thank you.

MR MASON: So consistent with that explanation then, Mr Abbott, when it comes to the quantification of further EOTs and the quantification of things like liquidator damages, there's going to be a split between - it's going to reflect that updated program and not what the contractor is actually experiencing on one site with their on-site programs?

WITNESS ABBOTT: It's my experience always ‑ ‑ ‑

MR MASON: Yes, thank you.

WITNESS ABBOTT: Liquidator damages are always calculated against the contract program.

484 Furthermore Abbott, in effect, conceded that he solely focused on the CP02 program because he considered it to be an 'approved program', a conclusion which I reject for reasons earlier stated. Abbott also in substance conceded that because he considered that this program was the only approved program, he did not amend the logic of the program notwithstanding changes to the works.[338]

485 Accordingly, and erroneously in my view, notwithstanding changes to the works including delays and sequencing changes, Abbott's delay analysis adhered to the logic of the CP02 program developed as early as about April 2011. Abbott did not render his analysis more persuasive by making appropriate amendments to the logic of the program he utilised, including by taking into account the reality of what occurred on the Precinct Project and how it was built, including the delays affecting the works.

Abbott purported to opine on matters not within his expertise

486 Abbott's evidence reflected a confusion of roles. In this regard, Abbott both provided his expert opinions as an expert 'Programming Expert', but also provided his opinion on matters beyond his established expertise in relation to, for example, whether certain Programs were of a certain character and compliant with the terms of the Contract, as to what constituted a variation under the Contract, and as to cl 34 of the Contract requiring prospective delay analysis.[339]

487 I consider that, in so doing, Abbott reflected his confusion as to his role as an expert programming witness in this proceeding. I also regard Abbott's partially confused approach to his brief as another factor diminishing the reliability and weight of his evidence in this proceeding.

488 Abbott's credit and reliability was also I consider reduced because it is clear from his evidence that he was willing to enthusiastically criticise Lyall's reliance upon the WUCP01 program as 'fundamentally flawed', and yet Abbott ultimately accepted that either the WUCP01 program used by Lyall or the CP02 program utilised by Abbott were appropriate to be used as 'baseline' programs to analyse the extent of delay on the Project,[340] and that either of those programs was appropriate as a baseline program for determining delay.

489 I am ultimately unpersuaded that there is any relevant issue between the parties in relation to a provisional period of delay which might otherwise be required to set-off Probuild's time extension entitlements.

490 In this regard, I note that the dKO Architectural Specification at cl [112C] states:[341]

... The Provisional Period for Delay will be deemed to be included within the Nominated Date for Practical Completion.

491 In my view these words clearly reflect the intent of the parties that the Dates for Practical Completion in the Contract take into account the Provisional Period for Delay referred to in the Contract.

492 Furthermore, nowhere in V601's pleadings is there an assertion that any relevant Provisional Period of Delay should be adjusted against Probuild's time extension entitlements.[342]

493 I do not consider that V601 pleaded any issue in relation to Probuild's case being in the nature of a global claim. In all events, I am not satisfied that Probuild's extension of time claims are in the nature of global claims.

494 The Lyall Third Report[343] explains the following:

Mr Abbott has provided an opinion that my analysis fails to consider culpable delay in progress of the works. My analysis clearly sets out what each delay event consists of, and how each event relates to the associated delay along the actual critical path to the Contractor's achievement of each separable portion. Mr Abbott says that my analysis is a global claim, and I deny that it is. For example, it can be seen in the following extract from my Report of 12 April 2018 that there are 29 days of critical delay from 5 July 2012 to 12 December 2012, which is attributable to the Contractor through the construction progress of the superstructure of Building A (emphasis added).[344]

495 In John Holland Construction & Engineering Pty Ltd v Kvaerner RJ Brown Pty Ltd & Anor (Kvaerner),[345] Byrne J made the following statement in connection with global claims:[346]

Argument before me focused on the causal link between two facts or groups of fact: the breaches of contract and the extra cost incurred by Holland which is the loss alleged. For present purposes, I assume that each of these facts has been established. This may be obvious but it is, none the less, worth stating, if only to underline that I am concerned with a pleading question: to what extent it is necessary to set out in the statement of claim the causal link between these two asserted facts. I am not concerned with the question, what loss, if any, flowed from the breach. Where a plaintiff establishes a breach of contract it will not be denied relief on the ground only that it is difficult to estimate the damages which flow from that breach.[347] This being the case, it may be said that a statement of claim which is unable to set out with precision the amount of loss claimed ought not to be struck out. But even in such a case, the plaintiff must identify what is the loss alleged to have been suffered and which cannot be quantified and how it is that this loss was caused by the breach. The amount of loss claimed here is not the problem; it is the causal link between this and the breaches of contract. Next, any question of the causal link must be examined in a pragmatic way.

Where the loss is caused by a breach of contract, causation for the purposes of a claim for damages must be determined by the application of common sense to the logical principles of causation.[348] Finally, it is possible to say that a given loss was in law caused by a particular act or omission notwithstanding that other acts or omissions played a part in its occurrence. It is sufficient that the breach be a material cause.[349] This last matter may be of particular importance in a case like the present where a number of potentially causal factors may be present. But, as will be seen, the form of the present pleading avoids these matters by implying rather than stating the necessary causal relationship.

The claim as pleaded ... is a global claim, that is, the claimant does not seek to attribute any specific loss to a specific breach of contract, but is content to allege a composite loss as a result of all of the breaches alleged, or presumably as a result of such breaches as are ultimately proved. Such claim has been held to be permissible in the case where it is impractical to disentangle that part of the loss which is attributable to each head of claim, and this situation has not been brought about by delay or other conduct of the claimant.[350]

Further, this global claim is in fact a total cost claim. In its simplest manifestation a contractor, as the maker of such claim, alleges against a proprietor a number of breaches of contract and quantifies its global loss as the actual cost of the work less the expected cost. The logic of such a claim is this:

• the contractor might reasonably have expected to perform the work for a particular sum, usually the contract price;

• the proprietor committed breaches of contract;

• the actual reasonable cost of the work was a sum greater than the expected cost.

The logical consequence implicit in this is that the proprietor's breaches caused that extra cost or cost overrun. This implication is valid only so long as, and to the extent that, the three propositions are proved and a further unstated one is accepted: the proprietor's breaches represent the only causally significant factor responsible for the difference between the expected cost and the actual cost. In such a case the causal nexus is inferred rather than demonstrated.[351] The unstated assumption underlying the inference may be further analysed. What is involved here is two things: first, the breaches of contract caused some extra cost; secondly, the proprietor's cost overrun is this extra cost. The first aspect will often cause little difficulty but it should not, for this reason, be ignored. The likelihood and nature of some extra cost flowing from the breaches of contract may be readily apparent from the nature of each of the breaches and a general understanding of its impact on the building project. It may also be apparent in what precise way this breach led to the extra cost. In most, if not all, cases, however, there is an intervening step relating the extra cost to the breach. For example, it may be that a breach means that work has to be redone, or that work takes longer to perform, or that its labour or material cost increases, or perhaps that there was extra cost due to disruption or loss of productivity. Again, in the given case this may be readily apparent but difficulties will arise for the parties and the tribunal of fact where the global nature of the claim involves the interaction of two or more of these intervening steps, particularly where they and their role are not, in terms, identified and explained. It is the second aspect of the unstated assumption, however, which is likely to cause the more obvious problem because it involves an allegation that the breaches of contract were the material cause of all of the contractor's cost overrun. This involves an assertion that, given that the breaches of contract caused some extra cost, they must have caused the whole of the extra cost because no other relevant cause was responsible for any part of it.

496 In Bernard's Rugby Landscapes Limited v Stockley Park Consortium Ltd,[352] the Official Referee Judge Humphrey Lloyd QC adopted Byrne J's analysis and statement of principle in Kvaerner[353] to the effect that:

(a) it is for the parties to determine how their case is to be articulated;

(b) the Court may however strike out a claim if it is untenable and likely to result in wasted Court resources, and where the articulation of the relevant claim is likely to prejudice, embarrass or delay the fair trial of the proceedings.

497 In Kvaerner,[354] Byrne J also stated that:

The question whether in a given case a pleading based on a global claim, or even a total cost claim or some variant of this, is likely to or may prejudice, embarrass or delay the fair trial of a proceeding, must depend upon an examination of the pleading itself and the claim which it makes.[355] The fundamental concern of the court is that the dispute between the parties should be determined expeditiously and economically and, above all, fairly. Where the proceeding is being managed in a specialist list, the judge, whose task it is to steer the case through its interlocutory stages, might, and perhaps should, explore the claim to determine whether the form it takes is driven by its nature and complexity, or by a desire to conceal its bogus nature by presenting it in a snowstorm of unrelated and insufficiently particularised allegations, or by a desire to disadvantage the defendant in some way. Relevant to this is an acknowledgment that a total cost claim puts a burden on the defendant. This burden may involve the defendant in extensive discovery of documents relating to the performance of the project; it may mean that at trial the defendant must cross-examine the plaintiff's witnesses to expose the flaws in a claim which assumes that the defendant is, itself, responsible for every item of the plaintiff's cost overrun; it may mean that the defendant must lead evidence to explain what, in fact, was the impact of each of the acts complained of on the project, as was done in McAlpine Humberoak Ltd v McDermott International Inc (No 1).[356] Litigation inevitably imposes burdens on the parties; the court must exercise its powers to ensure that, as far as possible, these burdens are not unreasonable and are not unnecessarily imposed.

498 I am satisfied that Probuild's case as articulated in this proceeding is not in the nature of a global claim or a total cost claim. This is because Probuild's delay claims, as pleaded and supported by the facts and expert evidence of Lyall in the way detailed above, and in many other similar articulations of Probuild's delay case, set out the nature of each relevant delaying event and how each relevant delaying event gives rise to Probuild's claimed delay, in particular including by reference to the actual critical path to completion of each relevant separable portion as established, principally by Lyall's evidence.

499 Further, I am not persuaded that Abbott's expert's evidence explains how it is that Probuild's claims are in the nature of global claims or total cost claims. At [131] of the Abbott First Report, Abbott relevantly states:

Whilst Mr Lyall has used an As Planned versus As Built method in windows, in respect of each of the analysis windows I note that Mr Lyall has not considered Probuild's performance on and off site. Further, Mr Lyall does not consider Probuild's own delays and/or concurrency of delays with matters that are Probuild's risk (for example wet weather), which ultimately results in each window being in effect a global assessment. That is, Mr Lyall assumes that the Principal is liable for all causes of delay.

500 I do not accept Abbott's statement that Lyall has not taken into account off-site delays; for example, Lyall's analysis deals extensively with the town planning related events and the procurement and manufacture of glazing in connection with EOT7. It is quite clear that, when Lyall considered it appropriate and necessary to do so, Lyall considered off-site delays in his analysis of the Probuild delay claims.

501 I consider that Probuild's extension of time claims are articulated and supported by evidence which cogently identifies each relevant qualifying delaying event and the causal connection between those events and the delay claimed by Probuild.

Contractually appropriate treatment of inclement weather

502 V601, through the evidence of its programming expert, Abbott, asserts that many relevant concurrent delays have occurred on the Project and that this should result in many instances of non-compensable delay.[357]

503 Probuild submits that cl 34.4(a) requires that the Project Manager evaluate and apportion delay to the WUC according to the degree to which the Qualifying Cause of Delay and the non-quantifying cause of delay (relevantly here inclement weather) contributed to delay to the WUC.

504 Probuild submits that in relation to all relevant delay, Probuild's work had been delayed by a Qualifying Cause of Delay from before, and throughout, the instances of inclement weather referred to by Abbott in his evidence.

505 Therefore, Probuild submits, the instances of inclement weather referred to by Abbott are not overlapping non-qualifying causes of delay; they were not the cause of delay; in each example, the existing Qualifying Cause of Delay was already delaying the works, and continued to do so after the occurrence of inclement weather. Probuild adds that Abbott's assertions about the effect of inclement weather do not consider what actually occurred in relation to delay and do not accord with common sense or the contractual requirements.[358]

Mr Abbott references inclement weather as a concurrent delay issue. I disagree with the way Mr Abbott has applied an abatement to his assessment of delay in respect of lost time due to the inclement weather. In my opinion, the effect of the inclement weather that is occurring during the time that occurs while the delaying events in question are causing delay only exacerbates the delay they cause, and does not act as a concurrent delay.

507 On the evidence and Lyall's expert evidence, I am not persuaded as to V601's unpleaded assertion that there have been instances of concurrent delay, which should result in deductions to extensions of time claimed by Probuild.

Concurrent causes of delay - other than inclement weather

508 V601's pleaded case does not assert any factual basis upon which it contends that concurrent delaying factors, either in the nature of inclement weather or from other causes, have contributed to the delays claimed by Probuild.

509 Probuild also observes, by reference to its list of V601's abandoned issues (provided 13 June 2019), that V601 has ultimately not pressed concurrent delays (other than in relation to inclement weather), including in relation to:

7. That the multitude of allegedly concurrent delays identified in V601's lay and expert evidence (except for wet weather),[360] including:

(a) installing the piling bench;[361]

(b) tower crane;[362]

(c) work to slab B7;[363]

(d) resourcing of Probuild's excavations subcontractor, HWM Contractors;[364]

(e) addressing the risks arising from the Soft Spots;[365]

(f) replacing Caelli with I&D as the in situ structure subcontractor;[366]

(g) Probuild's request for sign-offs of the vapour barrier's design.[367]

510 In the circumstances I consider that I need do no more than record that I am not persuaded as to any relevant concurrent delay which disentitles Probuild to any part of the extension of time claims it seeks to establish in these proceedings.

Programming experts' opinions in relation to prospective and retrospective delay analysis

511 Other than the evidence of each parties' programming experts, and Probuild's evidence from its Construction Manager, Bready, in relation to the substratum of fact drawn on, principally by Lyall (Probuild's programming expert), V601 and Probuild advance no other means of assessing the extent of compensable delay for the purpose of establishing the Contractor's entitlements to extensions of time under cl 34 of the Contract, or of establishing that integer of the calculation of delay damages pursuant to cl 34.9 of the Contract, or the extent of delay in relation to the qualification of common law damages for delay.

512 Put another way, the only time extension related cases which V601 and Probuild have put on by way of evidence and submissions is based on their respective prospective or retrospective assessments of delay to the WUC, and its Separable Portions, in turn founded on the expert programming evidence as to the effect and duration of delay, provided by either Lyall or Abbott.[368]

513 Given the highly complex nature of the Precinct Project, including as a result of it comprising eight Separable Portions, and the associated highly complex programming and delay analysis (both contemporaneously during the course of the Project, and as presented as evidence during the trial), save in relation to discrete and limited aspects, in my view, it is not appropriate or possible for the Court to establish the effect of the multitude of potentially relevant delays on the relevant critical path, other than by evaluating the expert programming and delay evidence relied upon by the parties in relation to relevant delays, informed by established on-site facts in relation to the Works and the progress of the Works, including constraints on activities, and the like. In these respects, at least, I consider that the present case is materially different to that decided in White Constructions Pty Ltd v PBS Holdings Pty Ltd, a case which was drawn to my attention by V601.

514 The parties have both engaged programming Experts to report on the assessment of delays to Probuild's work under the Contract, in relation to its extension of time claims. Lyall (Probuild) and Abbott (V601) prepared reports and participated in an Expert Conclave on behalf of their respective clients. As a result of the programming Expert's Conclave, Lyall and Abbott produced two Programming Experts Joint Reports dated 8 February 2019 (Programming Experts Joint Report 2) and 15 February 2019 (Programming Experts Joint Report 3).

515 The parties' experts adopted different programming methods in their delay analysis. Lyall used a 'retrospective' method of analysis. Abbott used a 'prospective' method.

516 Lyall also undertook the additional exercise of applying Abbott's prospective analysis methodology to bolster Lyall's own earlier conclusions based upon his preferred retrospective approach to analysing delay to the WUC.

517 Lyall based his retrospective delay analysis on Program WUCP01, as his Baseline Program. Abbott based his retrospective delay analysis on program 546 CP02, as his Base Line Program. The Programming Experts Joint Report states the following:

Base line program

The Approved Contractor's Program is bound into the Contract and labelled 546 CP02 (Approved Contractor's Program). No exactly matching electronic file has been found of the Approved Contractor's Program. The hard copy program bound in the Contract at Appendix 5A is a hard copy rolled-up summary program with approximately 300 activities. The softcopy programs used by the Experts contains approximately 3,500 activities.

546 CP02 is an electronic file that was created some time in September 2011. WUCP01 is an electronic file that was created in September 2011.

Neither 546 CP02 used by Mr Abbott in soft copy (Abbott's Baseline) nor WUCP01 used by Mr Lyall (Lyall's Baseline) exactly match the Approved Contractor's Program in hard copy)

There is very little difference between Abbott's Baseline and Lyall's Baseline from an analysis point of view.

The Experts agree that either program is a program that could be considered as an appropriate baseline program for determining delay.

There are minor variances on the dates for the activities between the Approved Contractor's Programs and the Lyall Baseline and the Abbott Baseline.[369]

518 Probuild also criticises Abbott for inappropriately opining as to contractual interpretation in his report, and critically in that regard, for asserting that 'clause 34.3 of the Contract only contemplates a prospective delay analysis'.[370]

519 Lyall's opinions as to the suitability of a prospective analysis of the type employed by Abbott included that Abbott's delay analysis methodology is 'not desirable as it cannot determine the actual extent of critical delay to Completion, it can only determine a forecast delay to Completion'.[371] Lyall opines that an As Planned v As Built analysis, in his opinion, 'is more appropriate to determine the actual extent of delay as opposed to a theoretical calculation of critical delay, especially as the facts of the case are now known'.[372]

520 However, as earlier noted, Lyall undertook a prospective analysis of the type undertaken by Abbott and came to very similar results to those produced by Lyall's retrospective analysis.[373] I note both that I have dealt more extensively elsewhere with the reasons why Lyall's evidence is more persuasive than Abbott's evidence, and I also note that this is a further factor convincing me that Lyall's evidence, analysis and conclusions are more persuasive than Abbott's on all programming and delay issues in dispute.

521 In the Programming Experts' Joint Report 2, the programming experts, Lyall (Probuild) and Abbott (V601), outline their opinions on the most appropriate delay analysis methodology, which can be summarised as follows:

A. Abbott's observations, propositions and opinions

(a) Both the 546 CP02 electronic program file used by Abbott in soft copy (Abbott's Baseline) and the WUCP01 soft copy program used by Lyall (Lyall's Baseline) are appropriate Baseline programs for determining delay in relation to the WUC.[374]

(b) Neither Abbott's Baseline program nor Lyall's Baseline program exactly match the Contract Appendix 5A program. The Contract Appendix 5A rolled up summary program contains only about 300 activities, and is not in electronic format. The experts' Baseline programs are electronic, programmable and identify about 3,500 construction activities.

(c) The retrospective analysis used by Lyall is inconsistent with the analysis requirements of the Contract, as it seeks to assess the actual delay attributable to an event whereas any actual delay that is found is a function of a myriad of actions, issues and general progress which occurs after the event and has no relationship to the delay being assessed.[375]

(d) The Prospective Delay Analysis seeks to assess if a delay has affected an activity on the critical path of the Approved Contractor's Program as it existed at the time of the occurrence, in accordance with cl 34.4(b)(ii) of the Contract.

(e) The Prospective Delay Analysis takes into account the information that is available to the parties at the time of the delay event and only that information.

(f) To introduce information, progress and impacts that were not known to the parties at the time of the delay event is inappropriate, unreasonable and not consistent with the Contract and commercial agreement upon which the Contract is based.[376]

(g) It is standard practice to status approved programs to ensure that the status date in the program is close to the commencement of the delay event being assessed and Abbott's programs are updated in the same way in which the Contractor updated its programs at the time of the Works.[377]

(h) The Association for the Advancement of Cost Engineering International preferences the use of contemporaneous schedules and updates as they were prepared/viewed, approved, and accepted in analysing delay; however, on this Project, no programs were prepared, viewed, approved, or accepted and used on the Project, because Probuild did not follow the contractual requirements of updating its Approved Contractor's Program and getting it approved by the Project Manager.[378]

(i) The programs used in Abbott's Time Impact Analysis are not theoretical creations but the Approved Contractor's Program statused at around the start of each alleged delay event using contemporaneous project data.

(j) Lyall's unapproved program varies from the Approved Contractor's Program and has been created by the Contractor from time to time, with no approval by the Project Manager or the Principal.[379]

(k) Lyall's As Planned v As Built analysis did not adequately consider Probuild's own delays and the concurrency of delays.[380]

(l) Lyall uses neither 'common sense' nor a 'practical approach' in establishing his critical path.[381]

(m) Abbott's primary reasoning for rejecting the use of Probuild's working programs is that they are not the Approved Contractor's Program and are not suitable for assessing delay in accordance with the requirements of the Contract.[382]

(n) Lyall has taken shortcuts which have produced an inappropriate As Planned v As Built analysis because he has rolled up activities rather than defining each and every activity on the critical path.[383]

(o) Lyall's retrospective delay analysis also fails to 'capture the eventual actual delay caused by the delay events'. Retrospective delay analysis, as used by Lyall, includes all of the events that occur after the delay being assessed and captures the effect of an incalculable number of decisions and impacts by the parties along a critical path (or paths) of the program, and construction progress relating to thousands of logic-linked activities (that is, under the control of the Contractor) that have been impacted by an innumerable number of influences which all occurred after the delay event under assessment. Abbott opines that it is not possible to capture the eventual actual delay caused by a discrete delay event using this method.

Prospective delay assessment (Abbott's method) on the other hand captures the impact of the discrete delay on the end date of the program, at the time the delay event occurs (which is required by the Contract), which is the same time that decisions resulting from that delay event are made.[384]

(p) Abbott also opines as to his view of the proper construction of cl 34 of the Contract.[385]

B. Lyall's observations, propositions and opinions

(q) Both the 546 CP02 electronic program file used by Abbott in soft copy (Abbott's Baseline) and the WUCP01 soft copy program used by Lyall (Lyall's Baseline) are appropriate Baseline programs for determining delay in relation to the WUC.

(r) Neither Abbott's Baseline program nor Lyall's Baseline program exactly match the Contract Appendix 5A program. The Contract Appendix 5A rolled up summary program contains only about 300 activities, and is not in electronic format. The experts' Baseline programs are electronic, programmable and identify about 3,500 construction activities.

(s) Lyall's methodology includes a retrospective analysis (As Planned v As Built) using WUCP01 (see Lyall First Report and Lyall Second Report).

(t) Lyall has also undertaken an alternative prospective analysis using the CP02 program to provide a comparison with Abbott's analysis.

Lyall also uses the CP02 program to undertake a retrospective analysis.[386]

(u) Both of Lyall's alternative analyses referred to in (d) have been developed to provide additional support for his primary analysis on a retrospective basis utilising the WUCP01 program.

(v) Lyall's As Planned v As Built method of delay analysis is the most appropriate method, because it assesses the actual critical delay to the relevant construction activities at the time of the delaying event, and does not provide a theoretical model of the impact of delays on the Works.[387]

(w) A prospective delay assessment is a theoretical forecast of what will transpire on the Project, without regard to what would actually happen during the course of the Works.

(x) A prospective assessment is inferior to an assessment of delay undertaken when the facts affecting the progress of the Project are known and the actual delay can be assessed.[388] Parties and experts do not need to rely upon a theoretical delay model when the actual delay to the relevant construction activities can be established.

(y) No native copy of the Approved Contractor's Programs existed at the time of the majority of relevant delaying events, nor were there native copies of contemporaneous construction programs at those times. Therefore, non-contemporaneous programs have been created to undertake Abbott's prospective analysis.[389]

(z) Lyall's retrospective method of analysis does not require the creation of programs to make assessments and is therefore more appropriate and practical in the assessment of delay events.[390]

(aa) The retrospective assessment of delay is consistent with the Contract because it establishes the critical delay to the activity or sequence of activities at the time of the delaying event.[391]

(bb) Absent a contemporaneous or Approved Contractor's Program, the retrospective assessment of delay is the most practical and reliable method of analysing the actual delay to the work referenced back to the appropriate baseline to measure delay as agreed by Lyall and Abbott, WUCP01.[392]

(cc) It has not been necessary to list hundreds of individual activities in a sequence which have no bearing on Lyall's analysis, nor where the critical path is located or the extended delay. Lyall has explained how he reaches conclusions on the location of the relevant critical path and has identified the activities delayed in each sequence.[393]

(dd) The retrospective delay analysis applies common sense and a practical approach to the location of the critical path, with reference to contemporaneous Project records and the measurement of delay.

(ee) Prior to commencement of fit-out works in late 2012, the construction of the Project was linear in nature, with one sequence of construction activity needing to be completed prior to completion of the next.

(ff) Three of the four relevant delays (EOT2/2A, EOT3 and EOT6) affected the construction of the baseline slabs or superstructure of the building. Construction at that stage was linear and sequential as is typical of residential or commercial construction projects.[394]

(gg) Slab construction work is critical to the linear progress of the construction of the buildings. If the buildings do not have a completed basement slab, then the vertical construction of the building cannot be completed in that area.[395]

(hh) It is common industry practice to introduce analysis in the form of high-level summaries of as-built critical paths. If greater detail is required in a particular area or section of the critical path, that can be detailed and added.[396]

(ii) An as-built programme is not required to calculate the difference between the actual start of an activity against the planned start of an activity. This is simple mathematics. The same applies for the finish dates. The As Planned v As Built windows analysis, as set out by the Protocol, is a method separate to the longest path method of analysis.[397]

(jj) In the Programming Experts' Joint Report 2, Abbott criticises Lyall for coming to conclusions regarding actual delay relating to his assessed delays to establish his as-built critical path, and then using these conclusions to establish critical paths.[398] In response, Lyall states:[399]

I disagree that I have approached this analysis 'back to front'. The assessment of some events need to be considered in the context that they occurred to assess whether it is likely that they are controlling the critical path at any given time. For example the procurement of the glazing and the manufacturing offsite which is the subject of EOT7 was not modelled at all in the contemporaneous updates. That does not mean that the delay event should be ignored, but means that an alternative method of assessment needs to be performed in to assist in establishing as to whether the delay in the placement of the glazing would have always controlled the completion of the works. This is the analysis that has been provided in my Report [e.g. paragraphs 147 through 164] and my Reply [258 to 280].

(kk) The Time Impact Analysis used by Abbott is a prospective method of analysis that can only be utilised to forecast a theoretical likely delay to the completion of works in his own forecast, which was created time distant from the actual completion of the project.

(ll) In relation to the Time Impact Analysis methodology, the Society of Construction Law Delay and Disruption Protocol (2nd ed) notes:

The product of this method of analysis is a conclusion as to the likely delay of the modelled delay events on the programme/critical path that is most reflective of the contemporaneous position when the delay events arose. This method does not capture the eventual actual delay caused by the delay events as subsequent progress is not considered.[400]

(mm) Given the timing of the dispute between the parties, and that the actual facts are known in relation to the project, a retrospective assessment of the actual critical delay that arose during the course of the works is more appropriate; and given that the facts for the delays have actually been established, a retrospective method of analysis that establishes what has happened is a more practical approach.[401]

(nn) The Contract appears to allow for either a prospective or a retrospective method of delay analysis to be performed, and as the facts are now know in relation to the Project, there is little benefit in preparing a prospective delay analysis that produces theoretical results when the actual delay to the completion of the works can be identified.[402]

(oo) The Society of Construction Law Delay and Disruption Protocol (2nd ed, February 2017) states:[403]

Delay impact is determined in one of two different ways. A prospective analysis identifies the likely impact of historical progress or delay events on a completion date. The conclusions of a prospective delay analysis may not match the as-built programme because the Contractor's actual performance may well have been influenced by the effects of attempted acceleration, re-sequencing or redeployment of resources in order to try to avoid liability for liquidated damages or due to other Employer and Contractor Risk events. A retrospective delay analysis identifies the actual impact of the delay events on the identified actual or as-built critical path. (emphasis added)

(pp) The Protocol supports Lyall's opinion and approach. The analysis is now time distant from the event, so reliance on a prospective method is inferior compared to a retrospective method such as the As Planned v As Built windows method.[404]

(qq) The As Planned v As Built method is based on the actual start and finish dates, compared to the relevant planned dates. This is Lyall's reason for relying on the retrospective method as his primary method of analysis.[405] Prospective analyses cannot and do not measure actual critical delay.[406]

(rr) Abbott's prospective analysis is limited to an indicative measure of delay in his own forecasts, as constructed in his own programmes.[407]

(ss) The CP02 program is not the Approved Contractor's Program provided in Appendix 5A to the Contract. As noted earlier, both experts agree on this point. Abbott's modifications to the CP02 program change the CP02 program so that it does not resemble the Approved Contractor's Program in Appendix 5A to the Contract.[408]

(tt) Abbott's criticisms of Lyall's use of the WUCP01 program are invalid because the WUCP01 program was contemporaneously produced by the Contractor before the start of the WUC, and is more likely to represent the Contractor's plan to complete the WUC than Abbott's modified CP02 program, which does not reflect the programme included at Appendix 5A to the Contract.[409]

Clause 34.3(a) requirements for assessment of a relevant delay to Probuild's WUC

522 Furthermore, Probuild and V601 are also in dispute as to how the Contract should be interpreted to assess relevant delays to Probuild's work under the Contract for the purposes of an extension of time claim under cl 34.

523 The issue concerns whether the assessment of a relevant delay pursuant to cl 34.4(b)(ii) should be made using a prospective method or a retrospective method of delay analysis, or whether either is permissible under the Contract.

524 Probuild submits that under cl 34.4(b)(ii) delay may be assessed either retrospectively or prospectively, however, Probuild seeks to establish its delay case based on a retrospective analysis.

525 V601 argues that under cl 34 of the Contract, delays must be established by prospective analysis of delay.

526 Clause cl 34.3(a) of the Contract requires an assessment of whether the relevant work is or will be delayed in reaching Practical Completion.

A party becoming aware of anything which will probably cause delay to WUC shall promptly give the Project Manager and the other party written notice of that cause and the estimated delay.

(a) Subject to clause 34.4, the Contractor shall be entitled to such EOT as the Project Manager assesses, if the Contractor is or will be delayed in reaching Practical Completion by a Qualifying Cause of Delay.[410]

(b) As soon as the Contractor becomes aware or suspects that the progress of WUC will be delayed (and in any event within 5 Business Days after the occurrence of the event causing the delay), it shall notify the Project Manager in writing giving details of the relevant event and the anticipated extent of the delay.

(c) The Contractor shall take all reasonable measures to preclude the occurrence of the event causing the delay, and to minimise the resulting delay to WUC.

(d) If the cause of the delay is a Qualifying Cause of Delay and the Contractor wishes to claim an EOT then as soon as the Contractor can ascertain or estimate with reasonable accuracy, the extent of the delay, and in any case not later than 10 Business Days after the occurrence of the Qualifying Cause of Delay, the Contractor shall make a written claim to the Project Manager for an EOT, giving details of:

(i) the Qualifying Cause of Delay;

(ii) the nature and extent of the delay, or likely delay to WUC; and

(iii) the EOT claimed.

(e) The Contractor shall promptly provide any further information requested by the Project Manager in relation to a claim for an EOT.

(emphasis added)

(a) When both non-qualifying and Qualifying Causes of Delay overlap, the Project Manager shall apportion the resulting delay to WUC according to the respective causes' contribution.

(b) The Contractor is not entitled to an EOT unless:

(i) it has made an EOT claim in accordance with the requirements of clause 34.3 (and in this regard time is of the essence);

(ii) the delay has affected an activity which is, in the reasonable opinion of the Project Manager, on the critical path of the Approved Contractor's Program as it existed at the time of the occurrence of the Qualifying Cause of Delay; and[411]

(iii) the Contractor has taken all reasonable measures to preclude the occurrence of the Qualifying Cause of Delay and to minimise the resulting delay including resequencing or reprogramming the performance of WUC where it is reasonably practicable to do so.

530 Further, cl 34.5 of the Contract provides that:

(a) Within 10 Business Days after receiving the Contractor's claim for an EOT, or if the Project Manager has requested further information from the Contractor in relation to an EOT claim, then after receipt of that further information, the Project Manager shall assess the EOT claim and notify the Contractor and the Principal in writing of the EOT (if any) granted so assessed.

(b) Notwithstanding that the Contractor is not entitled to or has not claimed an EOT, the Project Manager may, in the Project Manager's sole and unfettered discretion, at any time and from time to time before issuing the Final Certificate direct an EOT. The Project Manager is not required to exercise its discretion under this clause 34.5(b) for the benefit of the Contractor.

(c) A delay or failure of the Project Manager or the Principal to grant an EOT within the period specified in clause 34.5(a), or at all, will not cause the Date for Practical Completion to be set at large.

Probuild's position as to the required contractual analysis of delay for the purposes of cl 34.3(a)

531 In its Amended Defence and Counterclaim, Probuild seeks declarations in relation to its cl 34 entitlements.[412] Probuild also alleges breaches of the Contract by V601 arising from Probuild's time extension entitlements not being granted.[413] The breaches alleged by Probuild include the Project Manager's alleged failure to assess Probuild's extension of time claims in accordance with the criteria stipulated in cl 34 of the Contract.[414]

532 Probuild argues that it submitted appropriate updated versions of the Contractor's Program to the Project Manager for approval, in accordance with cl 32.2 of the Contract.[415] However, the Project Manager refused or failed to approve any of those programs as contemplated under cl 32.3 of the Contract.

533 Probuild argues that these updated construction programs, which it formally submitted to the Project Manager for his approval pursuant to cl 32.3 of the Contract constitute Approved Contractor's Programs for the purposes of the Contract.

534 Alternatively, Probuild submits that if such Programs are not 'Approved Contractor's Programs', that was a circumstance caused by V601 and the Project Manager's breaches of their obligations. V601 through its agent the Project Manager was contractually obliged to approve such programs and that if such programs are not formally 'Approved Contractor's Programs', through breach of the Contract by V601 and the Project Manager, by failure, refusal, and/or neglect to approve construction programs submitted by Probuild for approval, V601 by its agent the Project Manager has failed to do what the Contract required to be done and has thereby prevented Probuild from being able to base its time extension claim on a program approved by the Project Manager as an 'Approved Contractor's Program'.[416]

535 Probuild pleads that it submitted extension of time claims for the following extensions of time (which remain in issue):

(a) EOT1: 'Soft start';[417]

(b) EOT2A: Discovery of soft spots;[418]

(c) EOT3: Discovery of hydrocarbon contamination;[419]

(d) EOT6: Building C childcare tenancy;[420]

(e) EOT7: Delay to town planning approval regarding acoustic windows.[421]

536 In respect of the above, Probuild alleges breaches of the Contract by V601 in relation to each extension of time claim (which remain in issue):

(a) EOT1;

(b) The Early Works time extension claim granted only in part;[422]

(c) EOT2A: Not granted in full and dates for Practical Completion were also brought forward in relation to SP2 and SP5, due to soft spots;[423]

(d) EOT3: Not granted in full and dates for Practical Completion were also brought forward in relation to SP2 and SP5, due to the hydrocarbon delay;[424]

(e) EOT6: Not granted;[425]

(f) EOT7: Not granted.[426]

537 Probuild pleads, further and in the alternative, that if the notices submitted in respect of each extension of time claim are not valid, it relies on the prevention principle, as outlined in its Amended Defence and Counterclaim.[427]

538 In response to V601's Amended Reply and Defence to Counterclaim,[428] Probuild alleges, inter alia, that:

(a) V601 fails to plead the basis upon which it says that Probuild's updated Contractor's Programs did not comply with cl 32.3 and on what basis they could not be approved;[429]

(b) V601 fails to plead the basis upon which it says that Probuild 'failed and refused' to submit updated programs compliant with cl 32.3 at the Project Manager's request, to comply with the Project Manager's directions, and to promptly provide further information at the Project Manager's request.[430]

539 Probuild responds at length in response to V601's pleadings denying its extension of time claims;[431] the details of which are outlined elsewhere in this judgment.

Probuild submissions on admissibility of Lyall's evidence

540 Probuild rejects V601's submissions which assert that Lyall's Reports should be excluded from the evidence, because he has 'failed to disclose his real instructions', and 'undertak[en] a legal analysis of the Contract in order to determine the best method for analysing the relevant delays', and 'acted as a claims consultant' for Probuild in formulating claims that had no relation to the pleaded material facts.[432]

541 Probuild observes that V601 failed to put the allegation regarding Lyall's purported failure to disclose his real instructions to him in cross-examination, and submits that V601's criticism appears to be based on Lyall 'not finding an approved [contractors] program in the material provided to him'.[433] Probuild submits that Lyall appropriately 'expressed a personal preference for doing an as-programmed, as-built windows analysis ...'[434]

542 In relation to V601's contention that Lyall undertook a legal analysis of the Contract to determine the best method for analysing the relevant delays, Probuild submits that 'programmers quite often have to take a view on what the clause means in order to undertake the programme analysis ... They go and look at the material and they form opinions based on that material'.[435]

543 As for the method of analysis adopted by Lyall, Probuild points to Lyall's letter of instruction which asked him to:

Review the pleadings, contract and other documents briefed and prepare reports setting out your expert opinion as to whether the delay events, the subject of the various claims, affected an activity which is on the critical path of the approved contractor's program as it existed at the time of occurrence of the cause of delay.[436]

Lyall's view was that the analysis he undertook was that which was most appropriate in the circumstances.

544 V601 argues that Lyall lacked sufficient independence because he failed to disclose his real instructions.

Considerations/conclusions - objections to Lyall's evidence

545 I am not however persuaded that V601 has established any substantive or significant respect in which Lyall failed to disclose any material instruction. Furthermore, I also accept Probuild's submission that it was not squarely put to Lyall that he failed to disclose his real instruction in some significant respect, nor was it put to Lyall that he lacked independence. As a consequence Lyall was at all events not given the opportunity to directly refute this assertion by V601.

546 Similarly, V601 failed to squarely put to Lyall that he was, as submitted by V601, an advisor to Probuild, advising it on how best to formulate its time extension claims. Further, in my view, this assertion is not established by the evidence.

547 More specifically, I am not satisfied that Lyall was instructed to identify the relevant critical path of the WUC utilising an as-programmed as-built windows analysis; ultimately Lyall also undertook an alternative prospective analysis of delay to demonstrate the validity and preferability of his as-planned as-built retrospective analysis of delay on the Precinct Project, and Lyall also explained the rationale for preferring his methodology.[437]

548 Neither am I persuaded that in adopting the approach he did to undertaking his programming and delay analysis by reference to cl 34 of the Contract, Lyall overstepped the role of an expert witness in his area. In my view, in this regard it was practically necessary for Lyall to take a view as to what cl 34 of the Contract required in relation to identifying a critical path and the identification of relevant delay. Doing so does not in my view impugn Lyall as an expert witness.

549 I do not accept V601's submission that Lyall has undertaken a process of fact finding, including, as an example relied on by V601, in relation to commencement of delay in relation to EOT3. Rather, I am satisfied that Lyall's identification of 5 April 2012 as the start of that delay was the result of the synthesis of the factual evidence available to the Expert and the formulation of Lyall's expert opinion based on instructed facts, circumstances and assumptions. Bready's evidence was that Probuild could have commenced work on Slab B4 at about 5 April 2012, but for the delay caused by the immediately adjacent area affected by the vapour barrier and other factors.[438]

550 For the reasons including the above, and the reasons separately outlined elsewhere in relation to V601's objections to Lyall's expert evidence, I reject V601's arguments directed to having Lyall's expert evidence rejected as inadmissible; and I also reject V601's submission that in any event Lyall's evidence should be given diminished weight.

551 I consider Lyall's expert evidence to be wholly admissible, reliable and persuasive. In my view, Lyall did not, in the abovementioned or any other instance, purport to venture outside the legitimate role of an expert witness of his discipline, namely bringing his expertise to bear, informed by instructed facts and assumptions and desisting from purporting to determine factual matters.

Interpreting cl 34.3(a) to determine how delay analysis is assessed

V601's contentions as to the method of delay analysis and cl 34

552 V601 argues that cl 34.3(a) and cl 34.4(b)(ii), in particular, support its position that the Contract requires the application of a prospective method of delay analysis.

553 Referring to the text of cl 34.3(a), Abbott describes the approach that he adopted as follows:[439]

I have assumed this to mean that the Contractor will be entitled to an EOT if it is delayed at the time of the delay or will be delayed in the future by virtue of the delay. Either way, in my opinion, it is apparent this requires an assessment of relevant delay event to be undertaken at or around the time of the delay occurring necessitating a prospective form of analysis. By prospective form of delay analysis, I mean delay analysis that looks forward at the time of the delay and forecasts whether the end date of the program will be impacted by the delay event as distinct to looking back retrospectively after the event, at the end of the Project or at some later point in time.

554 Abbott's evidence in relation to Lyall's use of a retrospective As Planned v As Built method of analysis was that it 'is not suitable or appropriate in circumstances where, based on my assumption above, a prospective form of delay analysis was agreed between the parties in the Contract'.[440]

555 In oral submissions, in relation to Lyall's use of the April 2011 Baseline program and identification of the critical path of the Approved Contractor's Program, as it existed at the time of the occurrence of the qualifying cause of delay,[441] V601 submitted that there is a 'difference between a retrospective factual or delay analysis and a retrospective critical path analysis'.[442] In this respect, V601 submitted that Lyall's analysis of the critical path is 'significantly further away from the concept of the approved contractors program, as it existed at the time', and different to 'simply using a Baseline program that both parties have agreed was an appropriately similar program to the 5A program'.[443]

[T]his is not an analysis of a critical path of an approved contractors program that existed at the time of the cause of delay; it's not an analysis of the critical path of the baseline program that Mr Abbott accepted was appropriate for use in a delay analysis; it's not the assessment of a critical path on any programs that V601 has consented to having used in the determination of the rights as between the parties.

557 In respect of Lyall's retrospective analysis and establishment of the critical path, V601 submitted that Lyall's focus was on events occurring after the qualifying cause of delay.[445] Specifically, V601 submits that: