Alorra Piling (NSW) Pty Ltd v Bloc Constructions (NSW) Pty Limited; Bloc Constructions (NSW) Pty Limited v Alorra Piling (NSW) Pty Ltd

1. [1]

   Alorra Piling (NSW) Pty Ltd (Alorra NSW) claims to have carried out piling work for Bloc Constructions (NSW) Pty Ltd, the builder of the Watervue Apartments Project in Newcastle.

2. [2]

   The parties are in dispute about two matters:

   1. (1)

      In one proceeding, Alorra NSW sues Bloc for $1,415,301.17 as a debt under s 15(2)(a)(i) Building and Construction Industry Security of Payment Act 1999 (NSW) (SOPA); and

   2. (2)

      In other proceedings, Bloc seeks damages for defective works against Alorra Pty Ltd or Alorra NSW and two individual guarantors, Mr and Mrs Quigley, under a Deed of Loan, Security and Guarantee.

3. [3]

   Common to both proceedings is a dispute about who the parties to any contract are, and the terms of the contract or agreement under which the piling works were performed: Alorra NSW contends that it had a contract with Bloc, while Bloc contends that it only entered into a contract with Alorra Pty Ltd, as evidenced by the deed.

4. [4]

   To facilitate the just, quick and cheap resolution of both proceedings, and in accordance with the objects of SOPA, I ordered that the following issues be determined first as separate questions:

5. [5]

   Alorra Pty Ltd and Alorra NSW undertook that the determination of the questions would bind them in both proceedings.

6. [6]

   As explained below, I find that there is a “construction contract” within the meaning of SOPA between Alorra NSW and Bloc, mainly on the terms contained in Alorra NSW’s 14 May 2024 quotation.

What variations of contract do the parties allege?

1. [7]

   Alorra NSW frames its case for a construction contract or “other arrangement” in three possible ways:

   1. (1)

      Its primary case is that on 14 May 2024, Alorra NSW submitted a quote to Bloc to carry out piling works on the project, which Bloc accepted on 25 June 2024 and directed Alorra NSW to commence work, which it did. Bloc paid Alorra NSW for most of its claims. Alorra’s scope of work outlined in the quotation by reference to drawings was varied as the project was carried out, by agreement.

   2. (2)

      Alternatively, Alorra NSW submits that, in addition to the quote, a scope of works document created on 28 August 2024 was agreed and Alorra NSW worked in accordance with that description of works, but not as to the time for the works.

   3. (3)

      If the parties’ intentions are insufficiently certain, then there was an “other arrangement” for the purposes of SOPA, because Alorra NSW performed work for Bloc on the site, Bloc accepted that work and paid Alorra NSW, save for the amount now in dispute.

2. [8]

   In contrast, Bloc submits that the construction contract was found solely in the “Deed of Loan, Security and Guarantee” between it and Alorra Pty Ltd, and attached the 28 August scope of works. When asked during oral submissions, Bloc’s counsel submitted that while neither the deed nor the scope of works contained a price, which was accepted to be an essential term, the price could be incorporated by the Court “fill[ing] the blanks” by reference to the parties’ conduct, although that was not pleaded.

3. [9]

   The legal principles for finding a contract are not in dispute: see eg summary in Younan v Herberton Enterprises Pty Ltd [2023] NSWSC 1566 at [22]. The party claiming a contract was formed has the onus of proving that contention on the balance of probabilities, based on an objective assessment of the parties’ intentions derived from their words and behaviour. Post-contractual conduct may also be used to prove that a contract was formed: Brambles Holdings Ltd v Bathurst City Council (2001) 53 NSWLR 153 at [25] (Heydon JA).

4. [10]

   It is therefore necessary to outline a detailed chronology of particularly the exchange of documents between the parties.

How did the parties behave?

1. [11]

   Mr Quigley is the sole director and shareholder of both Alorra companies. There are also other “Alorra” corporate entities, including Alorra Contracting Pty Ltd, which Mr Quigley said ”carries out on occasion, non-union” works and obtains goods from suppliers for other Alorra companies, including by providing sand and sheet corners for Bloc’s project.

2. [12]

   In late 2023, there were initial discussions between Mr Quigley and Bloc about an Alorra entity carrying out piling works for the project. Mr Quigley was adamant that he always specified the particular entity in any negotiations.

3. [13]

   On 15 November 2023, in response to a tender request, Alorra NSW submitted a quote to Bloc to carry out piling works including design works for $2,490,300.

4. [14]

   At a later meeting, Bloc sought from Alorra NSW a quotation “in the first instance” for a geotechnical investigation, to confirm the likelihood of reducing the “overall depth of the piers” and related savings. Bloc accepted Alorra NSW’s quotation for the investigative works, by 26 March 2024 those works were complete, and on 31 May 2024 Bloc paid Alorra NSW’s invoice.

5. [15]

   By April 2024, Mr Elliott Scifleet was Bloc’s project manager for the project. I accept his evidence that he was careful in performing his role and took care with issues of detail. He accepted that it was important to Bloc that subcontractors working on the site were appropriately licensed and carried appropriate insurance, because of the obligations found under the Home Building Act 1989 (NSW). He was aware that Bloc would be committing an offence if it allowed unlicensed subcontractors to perform work on the project.

6. [16]

   On 14 May 2024, Alorra NSW submitted a revised and reduced quote for piling works, including design works, for $2,175,200. It included:

7. [17]

   On 25 June 2024, Mr Scifleet sent an email to Mr Quigley which included the following:

8. [18]

   Despite the fact that both Alorra NSW and Bloc had indicated that they expected formal documentation to be finalised, on the same day, Mr Schifleet directed Alorra NSW to commence work on workplace design and safety documentation. Further, Mr John Adamiec of Alorra NSW sent an email to Bloc:

9. [19]

   I consider it important that in both the quotation and the responses that followed there was repeated reference to Alorra NSW being the relevant party undertaking the construction work.

10. [20]

    I do not accept Bloc’s submission that it would not be of any significant relevance that Bloc committed an offence under the Home Building Act by contracting with Alorra Pty Ltd, a non-licensed entity. It was in my view an objectively important matter for both Bloc and Alorra NSW and Alorra Pty Ltd that only licensed entities carried out works under the Home Building Act; and, the parties can be taken to have been aware that the right to progress payments under is conditional on compliance with the licencing provisions of the Home Building Act: see s 8 SOPA; s 4 Home Building Act.

11. [21]

    From June 2024, the parties discussed various agreements and draft documents were prepared. However, despite both Alorra NSW and Bloc expressing a desire for a formal construction contract or subcontractor contract, none eventuated.

12. [22]

    First, Mr Quigley asked for an advance payment of $500,000 to assist with the piling works. Bloc was prepared to provide such an advance, if it was documented in a deed and security was provided. The deed became the only contractual document signed, but only by Alorra Pty Ltd and Mr and Mrs Quigley, not Bloc or Alorra NSW.

13. [23]

    Secondly, the parties exchanged amended versions of Bloc’s standard form scope of works. While that document included a place for acceptance by signature, no party ever signed any version of it. Every version included “It is a prerequisite that the Subcontractor will be required to accept the BLOC subcontractor agreement and conditions”.

14. [24]

    Thirdly, the parties exchanged versions of a Bloc standard form “Subcontract for Major Works”, but none was ever signed.

15. [25]

    On 1 August 2024, Alorra NSW issued an invoice for $500,000 for the advance payment. Around that time Mr Scifleet had a conversation with Mr Quigley to obtain information for Bloc’s lawyers drafting the deed. Of particular concern for Bloc was the entity that would provide security in the form of a piling rig. Alorra Pty Ltd was nominated by Mr Quigley for that purpose, because only it owned a rig. Details of Alorra Pty Ltd’s rig were also provided.

16. [26]

    On 13 August 2024, Bloc instructed Alorra NSW to complete the design works based on advice from an engineer and to also proceed with ordering sheet piles and pile cages.

17. [27]

    On 19 August 2024, Mr Scifleet emailed Mr Quigley including:

18. [28]

    On 24 August 2024, Alorra NSW submitted a pile design to Bloc.

19. [29]

    On 26 August 2024, Bloc sent a draft “Deed of loan, security, guarantee and indemnity” between Bloc and Alorra Pty Ltd and Mr and Mrs Quigley. The deed provided for the early advance of $500,000 to be used towards the piling works. Annexure A was entitled “Scope of Works Agreement”. A scope of works was provided at the same time.

20. [30]

    On 27 August 2024, Mr Quigley’s unchallenged evidence was that negotiations for finalising a formal subcontract ceased.

21. [31]

    Around 28 August 2024, Mr Scifleet instructed Mr Quigley that the pile cages could be ordered. Those works were consistent with the quotation that had been accepted.

22. [32]

    On 5 September 2024, Alorra NSW provided a workplace health and safety plan described as “Project Health, Safety & Environment Plan”. On the same day, Alorra NSW provided a variation for the “changes in piles from new drawings … and the latest revision which our design has used”. That variation was subsequently approved by Mr Scifleet.

23. [33]

    On 12 September 2024, Bloc sent Mr Quigley a final version of the deed, which was executed by Alorra Pty Ltd and the Quigleys on the same day. Despite the deed referring to “the Major Works Subcontract” being attached as “Annexure A”, there is no such document; as before, Annexure A was entitled “Scope of Works Agreement”. Neither Bloc nor Mr Quigley signed the scope of works document.

24. [34]

    On 16 September 2024, Bloc paid the $500,000 loan sum to Alorra NSW on its earlier invoice that had been generated before the deed was drafted. Bloc raised no issue with the inconsistency between the Alorra entities.

25. [35]

    On 18 October 2024, Alorra NSW commenced works on site. On 25 October 2025, Alorra NSW issued to Bloc its first payment claim for works, which Bloc paid on 7 November 2024.

26. [36]

    Up to May 2025, Alorra NSW issued further payment claims, in response to which Mr Scifleet for Bloc either issued to Alorra NSW payment schedules or paid it the amount sought.

27. [37]

    In March 2025, Bloc refused to pay Alorra NSW a payment claim because of alleged delays. In a letter addressed to Alorra NSW dated 11 March 2025, signed by Mr Scifleet, Bloc referred to “the agreement” between Bloc and Alorra NSW, and contended that Alorra NSW was in breach of that agreement insofar as it had purportedly failed to: (a) complete “all Foundation Piling works” by 18 December 2024, and (b) “meet the agreed production rate of 2.5 piles per day” which was described as a failure “to meet practical completion”.

28. [38]

    Bloc issued a payment schedule dated 14 April 2025, which referred to Bloc having held a retention of $118,279.12 and included notations in support of reductions from the amount of Alorra NSW’s payment claim including:

    1. (1)

       That the “scope of works” with timing was accepted by Mr Quigley when he signed the deed;

    2. (2)

       The piling works were late and liquidated damages were payable;

    3. (3)

       The $500,000 advance payment needed to be deducted from Alorra NSW’s claim in accordance with the deed.

29. [39]

    On 30 April 2025, Alorra NSW sent Bloc an invoice, indicating the amount of work certified was $3,157,451.33 and the amount claimed as outstanding was $1,556,831.29. It recorded that Bloc had retained money “without any contractual entitlement”.

30. [40]

    On 2 May 2025, Alorra NSW issued the payment claim in dispute for the above invoiced amount. Bloc did not issue a payment schedule before 16 May 2025; Bloc accepted it was therefore “late”.

What was the contract?

1. [41]

   I consider that in June 2024, Bloc intended some form of arrangement with Alorra NSW concerning the piling works for the project. Shortly before that, Bloc had agreed for Alorra NSW to carry out geotechnical works and had paid it for that work. Part of the purpose of those works was for Alorra NSW to be more certain about the works necessary and reduce its tender quotation. I consider it unlikely that Bloc intended to contract with a different Alorra entity thereafter, particularly where its own email “awarded” Alorra NSW the contract. All of the parties’ correspondence and SOPA documentation referred to Alorra NSW.

2. [42]

   It is unnecessary to decide whether the parties intended to be bound to the quotation at that time. They had each indicated they intended to enter into a formal agreement, which might suggest no intention to be bound until that occurred: see Masters v Cameron (1954) 91 CLR 353. However, even if that was the case, I consider by their conduct they waived any requirement for a formal document, as later negotiations for a formal document were abandoned, yet Bloc requested work, Alorra NSW performed it, and Bloc generally paid: see discussion in eg GJ Tolhurst and Elisabeth Peden, Furmston and Tolhurst on Contract Formation, 3rd edition, Oxford University Press, 2023, paragraphs [8.114]-[8.133] and cases cited therein. Therefore, I consider Bloc agreed to be bound by Alorra NSW’s quotation terms.

3. [43]

   I also consider it important to the conclusion of the contracting parties that Alorra NSW was licensed, and Alorra Pty Ltd was not. Mr Scifleet accepted that Bloc’s usual practice was that it would carry out inquiries to satisfy itself that subcontractors were appropriately licensed and insured. Mr Scifleet did not directly accept that at the time he was aware of the fact that Alorra NSW, rather than Alorra Pty Ltd, was licensed. However, he accepted that by the time he received Alorra NSW’s first payment claim in October 2024, he was so aware and it did not surprise him. He also accepted that at no time prior to the proceedings commencing did he ever assert that the relevant contracting entity was Alorra Pty Ltd, and instead he behaved as if it was Alorra NSW by issuing payments or payment schedules to Alorra NSW. Even if Mr Scifleet was not personally aware of Alorra NSW’s licence and insurance, I infer that by June 2024, Bloc was aware either because someone within Bloc had carried out the usual investigations or likely was aware from Alorra NSW’s payment claim for the geotechnical investigative works.

4. [44]

   This conclusion of the contact being with Alorra NSW is consistent with Bloc’s conduct in not disputing any of Alorra NSW’s payment claims on the basis that there was no “construction contract”; it never did so, and to the contrary asserted in correspondence that Alorra NSW had breached “the contract”.

5. [45]

   Bloc’s submission was that it can be inferred that the parties agreed that the deed between Bloc and Alorra Pty Ltd was their construction contract, because after its execution there was no obvious further attempt to agree on a formal subcontract. I reject that submission. Instead, the parties abandoned negotiations for a formal subcontract.

6. [46]

   Bloc further relies on the deed as demonstrating the final construction contract between it and Alorra Pty Ltd primarily because:

   1. (1)

      Recital B states that Bloc (as lender) and Alorra Pty Ltd (as borrower) are parties to the “Contract”.

   2. (2)

      The Contract is defined as “the Major Works Subcontract between [Bloc] and [Alorra Pty Ltd] in relation to the Development, a copy of which is at Annexure A”.

   3. (3)

      Pursuant to clause 3, the loan was repayable as a deduction from the “final payment claim submitted by [Alorra Pty Ltd] under the Contract” or if the Contract was terminated.

7. [47]

   I accept the deed recognised the existence of a construction contract; it would not have come into existence without it, as it was intended to provide an early payment to assist cashflow for the piling works. That does not, however, make it a source of any terms for that construction contract. There is nothing in the deed or scope of works that amounts to a promise to carry out works or a promise to pay for them, both of which would be necessary for a binding construction contract. Neither is there any indication of the essential term of a price, which cannot be simply “filled in” by the Court to assist Bloc where its pleaded case is the contract was solely found in the deed and the scope of works document.

8. [48]

   The substantive obligation in the deed of Alorra Pty Ltd and the Quigleys, other than ensuring repayment, was to ensure that the security provided, being Alorra Pty Ltd’s rig, was insured and kept free from encumbrances.

9. [49]

   I do not accept that the unsigned scope of works provided with the deed incorporated terms into of any contract because:

   1. (1)

      It was not executed as intended by the execution block.

   2. (2)

      It expressed that “It is a prerequisite that the Subcontractor will be required to accept the BLOC subcontractor agreement and conditions”. There was no agreed Bloc subcontract.

   3. (3)

      It was incomplete. For example, the site team and contact details were left blank. There were various mark ups in the document.

   4. (4)

      It was inconsistent with the works to be carried out for the agreed price in the quotation. It included works that were processed as variations.

   5. (5)

      It did not include any price for the works (and neither did the deed).

   6. (6)

      It did not include a clear indication of when the works were required to be carried out. Bloc’s counsel attempted to demonstrate that the time allocated in a construction programme prepared by Mr Scifleet was consistent with oral conversations. However, any terms based on oral conversations were abandoned at the commencement of the hearing. Further, the document appeared internally inconsistent with its calculation of time. The fact that it was impossible to decipher how to read the programme without having information that was proffered during cross-examination by Mr Scifleet about how the computer program might work, indicates that it cannot be objectively determined that there was an agreed time for performance of the piling works.

   7. (7)

      The scope of works is not bespoke to the piling works, as might be expected if it was to contain contractual terms; instead, it appears to be a standard form document that Bloc was using for all of its subcontractors concerning diverse matters such as scaffolding, and handling of materials on site. That is particularly true of the construction programme within the scope of works, in which the piling work represented only a few line items.

10. [50]

    Other conduct of the parties relied upon by Bloc does not change the conclusion:

    1. (1)

       It is not material that Alorra Contracting Pty Limited bought certain materials for the project, for which Alorra NSW invoiced Bloc. Mr Scifleet was aware of this, as he approved the payment claims that attached the relevant invoices. It is of trivial significance to the question of the contract that the Alorra companies had an internal arrangement for dealings with suppliers.

    2. (2)

       Merely because the safety sign on site referred to “Alorra Group” does not mean that Alorra NSW was not the contracting party.

    3. (3)

       Mr Quigley candidly accepted that the preprinted daily piling sheets were headed with “Alorra Piling Pty Ltd”; he considered it would be waste to just throw them out merely because that entity no longer existed. There is nothing to suggest that Bloc relied upon the reference to that entity on those piling sheets to indicate that the contracting party was Alorra Pty Ltd.

    4. (4)

       Just because employees of various Alorra companies had email footers of “Alorra Group” or were identified on Bloc’s site induction documents as working for “Alorra Group” or “Alorra” does not assist with the determination of who the relevant Alorra company was the contracting party.

11. [51]

    To the extent that the conclusion that the parties entered into a “construction contract” by Bloc’s acceptance of Alorra NSW’s quotation and the parties subsequent conduct is erroneous, then I would find that there was an “arrangement” between the parties within the meaning of s 4 SOPA. It is unnecessary to decide if such arrangement must be legally enforceable: see eg Machkevitch v Australia Building Constructions [2012] NSWSC 546 at [27]-[28] (McDougall J); Crown Green Square Pty Ltd v Transport for NSW [2021] NSWSC 1557 at [165] (Henry J); cf Lendlease Engineering Pty Ltd v Timecon Pty Ltd [2019] NSWSC 685 at [68]-[69] (Ball J, as his Honour then was). If it does, then Alorra NSW would have an entitlement to restitution for work carried out, and if not, then Alorra NSW must also succeed. There is no suggestion that Alorra NSW ever entered the site and carried out work without Bloc’s direction or approval and permission.

Conclusion

1. [52]

   For those reasons, the “construction contract” for the purposes of the SOPA was between Alorra NSW and Bloc on the terms outlined in the 14 May 2024 quotation and its acceptance, and the conduct of the parties, including the variations that were approved without agreeing any other terms.

2. [53]

   There was no time specified for the completion of the piling works, such that they were required to be completed within a reasonable time: see s 18B(d) Home Building Act. It was accepted by the parties that the other s 18B warranties were implied.

3. [54]

   I therefore make the following orders requiring the parties to confer on the necessary orders that will give effect to this judgment:

   1. (1)

      On or before 4pm on 13 November 2025, the Alorra parties serve on Bloc short minutes of order intended to give effect to these reasons for judgment together with the orders it proposes in relation to costs and any necessary explanation;

   2. (2)

      On or before 4pm on 20 November 2025, Bloc: