In 2003, P&O Trans Australia Holdings Ltd (P&O), who was lessee of the Land, entered into a contract with Walker Group Constructions Pty Ltd (WGC) for the design and construction of 5 warehouses, and associated work, which included laying pavements in between and outside of the 5 warehouses (D&C Contract).
In the D&C Contract, WGC gave certain warranties as to standard of workmanship and fitness for purpose.
Specifically, WGC relied on the fact that the letter provided that consent to the assignment was granted `from the sale date'. First, His Honour opined that the consent could not impact the scope and found that `'.
Instead, that date was interpreted as identifying the date from which the assignment would take effect.
Nevertheless, this case serves as an important reminder that any limitations a party wishes to place on the scope of the assignment need to be clearly identified, and that particular care must be taken when consent is being considered and provided.
benefits) of your contract to another person, an assignment is the appropriate choice for you.Tzaneros' claim based on the assigned warranties Tzaneros commenced proceedings in the Supreme Court of New South Wales based on breach of the contractual warranties purportedly covered by the assignment in the Deed.Tzaneros claimed nearly AU million in damages from WGC and other parties as a result of the defects.The D&C Contract also provided that neither party could assign any right or benefit under the contract without the other's prior approval.After the works were completed, P&O's leasehold interest in the land was transferred to Tzaneros and P&O entered into a Deed with Tzaneros purporting to assign WGC's warranties under the D&C Contract.Concluding remarks The Supreme Court of NSW found that neither the assignment nor the consent was limited only to causes of action that accrued after the assignment took place. The result turned on the terms of the assignment and consent, along with the surrounding circumstances.Indeed, the fact that the assignment was construed in broad terms is perhaps unsurprising in light of those things.His Honour opined that had the parties intended to limit the assignment to breaches arising after the assignment was effected, `they would have said so specifically'.WGC argued that it did not consent to the assignment in such broad terms.The assignment allows the third party to enforce those rights against the other contracting party as if it were a party to the contract in the first place.The contract between the original parties otherwise remains in full force and effect.