Read the full judgment text of HCCT000032/1996 on BabelCite. This HIGH COURT judgment was delivered on 30 July 1996 before The Hon. Mr. Justice Keith in Chambers.
Contract law – Construction sub-contract – Default judgment – Alleged agreement to stay contingent on payment – Effect of contemporaneous correspondence showing payment pre-condition – Clarification of terms of stay agreement – Sub-contract clauses – 'Pay when paid' clause (cl. 22) overridden by special condition setting payment stages – Liability to pay retained sums without employer's certification or release – Non-binding architect's determination on withholding payments – Variation works assessment – Absence of evidential basis for revised sum – No defence with real prospect of success – Application to set aside judgment dismissed. The defendant main contractor, Hip Hing Construction Company Limited, engaged Swire Engineering Services Limited as sub-contractor. Swire claimed unpaid sums, obtained default judgment; Hip Hing sought to set aside on grounds of irregularity based on stay agreement. Court found stay agreement was contingent on payment not made, so judgment regular. Defendant's reliance on a 'pay when paid' clause was rejected as overridden by a special condition regarding payment stages. Defences to withholding retained sums and dispute on variation works payments lacked evidential support and real prospects of success. Application to set aside default judgment dismissed by The Hon. Mr. Justice Keith in chambers on 30 July 1996.
Legal issues: Validity of judgment in default given alleged agreement to stay proceedings · Effect of 'pay when paid' clause in sub-contract on payment obligations · Liability to pay retained sums pending certification or release from employer · Defences related to variation works payment sum of $108,800
Outcome: Application to set aside judgment dismissed; default judgment stands