Justice Dawson said this some 25 years ago in the NSW Minister for Works’ application to the High Court seeking permission to appeal a fair value award in favour of construction contractor, Renard Constructions (ME) Pty Ltd. In Sunwater Ltd v Drake Cole Ltd and another (“Sunwater”), the Queensland Court of Appeal (“QCA”) affirmed that, 25 years later, this principle still holds true.
In Sunwater, a construction contractor sought payment of the fair value (quantum meruit) of its work, where:
- the owner had asked the contractor to do that work;
- when requesting that work, the owner knew that the contractor expected to be paid for it (which was implied in the commercial relationship between owner and contractor); and
- no contract between owner and contractor provided for when or how much the contractor was to be paid for its work.
The owner tried to defend the contractor’s claim, saying that in later, unrelated dealings between the same two parties, the contractor had acted unreasonably.
The owner tried to argue that the contractor’s claim for payment without a contractual right to payment was based on the concept of “unjust enrichment”. According to the owner, this meant that the Court had to decide whether the owner “unjustly” became enriched as a result of the contractor’s work.
The QCA was so unconvinced by this defence that it did not even allow the owner to put it forward at a trial. Instead, the QCA struck out the defence as not recognised by the law and upheld, without a trial, the contractor’s claim to be paid the fair value of its work.
The lesson is: a contractor has an unqualified legal right to be paid for work that the owner requested, even if there is no contract that says so. Where the right to payment is not contractual, that right will have an alternative legal basis called “unjust enrichment”. Despite the use of the word “unjust”, this right to be paid is a strict legal right and cannot be taken away simply because the payment might be perceived to be “inequitable in all the circumstances” (as Sunwater put it).
After all, it can never be unjust to be paid what your work is worth.
This is general information only, and does not constitute specific legal advice. If you would like further information in relation to this matter or other legal matters please contact our office on Freecall 1800 609 945 or email us now.