ACT court orders Beno Excavations and Civil and Civic to have contested hearing about earthworks payment

ACT Supreme Court documents state Beno Excavations, formerly trading as Benex, was contracted to do earthworks at a Nova Builders-owned Greenway site beginning in November 2019.

In March the following year, Civil and Civic Corporation had taken over the works on the shore of Lake Tuggeranong after Benex could not complete them.

About the same time, Benex's general manager had resigned then started working for Civil and Civic.

Two months prior, the general manager issued two invoices in the name of Civil and Civic - rather than Benex - to Nova for $550,000.

"Whether or not that was correct, Nova Builders paid those invoices," court documents state.

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The construction firms sent Nova separate claims of entitlement to payment before they began separate court proceedings to demand payments.

Nova sought the court's help to impose an interpleader relief - a procedure to compel the parties making the same claim to litigate the matter between themselves.

The application was granted and included that Nova transfer about $462,000 - a disputed sum - into the court's custody.

Benex and Civil and Civic then filed competing applications for the court to determine what should happen next.

Benex claimed Nova owed it $772,767 for works between November 2019 and March 2020.

It argued Civil and Civic already received funds it was not entitled to and Nova should pay the $462,000 to Benex to partially reduce the outstanding debt of $772,767.

Civic and Civil claimed Nova owed it $462,000 as it related to works completed since March last year.

It also argued both companies' claims related to separate contracts for works at different times and, therefore, Nova may be liable to both parties.

In a recent judgment, acting Justice Verity McWilliam said while an interpleader relief appeared to have been an option for Nova, it was not appropriate for this case.

The judge said this was because of two different debts being claimed and the case indicating that Nova may be liable to both firms.

She said it was also because Nova could not remove itself from the proceedings due to the $550,000 it already paid to Civil and Civic and because the two separate claims did not seek any "relief against the other".

She said Nova's proposed defence against Civil and Civic to counter-claim against it by seeking restitution of $550,000 also contributed to its role in the proceedings.

Acting Justice McWilliam cited a previous case that put the need for "clarification of the real issues" first before "other principles of normal interpleader proceedings" in which that case had "a combination of procedural irregularities and missteps on an interpleader summons".

The judge in that case said the "proceedings are a procedural Mad Hatter's tea party".

Acting Justice McWilliam, however, said "the reference to the famed scene of confusion from Lewis Carroll's Alice's Adventures in Wonderland might not quite accord" with the applications in this case.

"[They] are more of an incomplete puzzle, with key pieces yet to be placed, or even loosely arranged, in a manner that would allow the court to discern the full picture," she said.

She said the court needed to set "the parties on a path that will best clarify the real issues in dispute" because neither firm "has yet satisfied the court of a clear entitlement to the disputed sum".

Benex's and Civil and Civic's applications for entitlements were dismissed and a contested hearing on formal pleadings was ordered.

The parties have been given until December 2 to propose a timetable to progress the case.

The money held by the court remains in place.

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