Alphington developments pty ltd v amcor pty ltd [2025] VSCA 48

The Victorian Court of Appeal in Alphington Developments Pty Ltd v Amcor Pty Ltd [2025] VSCA 48 considered whether the contractual mechanism for certifying works and enabling payment had failed and whether the Court could intervene to provide an alternative method for determining the amount payable.

The enforcement of foreign or international judgments in Australia is primarily administered by the Foreign Judgments Act 1991 (Cth) (the Act). The Act allows for foreign judgments to be enforced provided that the statutory criteria are met. These are explored below.

Background

Alphington Developments Pty Ltd (Alphington) purchased a former paper mill site from Amcor Pty Ltd (Amcor) to develop a residential housing project. Under the contract, Amcor agreed to compensate Alphington for the costs of remediating any unidentified contamination found on the site, provided certain contractual procedures were followed.

However, once work began, Alphington discovered far more contamination than expected, making it difficult to follow the original process set out in the contract which required a consultant to assess the contamination and estimate costs as the works progressed. Given the scale of the contamination, both parties agreed to abandon the original process stipulated under the contract and instead decided to assess the total cost of remediation after the work was completed.

Decision

The Court found that both parties had abandoned the original process, which involved assessing contamination costs as they were discovered, and instead agreed to assess costs retrospectively after the work was completed. Considering this change, the Court said the original mechanism had failed, but the obligation to pay still existed.

Importantly, the Court confirmed that if the failed process is not essential to the contract’s main purpose, it can step in and provide a new method to determine payment. Since the contract aimed to ensure fair and reasonable compensation, and the parties had agreed the Court could resolve disputes, the Court decided it could take over the consultant’s role.

The Court ruled that it would determine:

1. what work was necessary to clean up the contamination; and
2. what costs Alphington reasonably incurred in cleaning the contamination.

Amcor sought special leave to appeal in the High Court which was refused on 7 August 2025.

Implications

This decision indicates that courts may intervene when the agreed contractual mechanisms fail or are abandoned so that developers are not left without remedy when the original process becomes unworkable.

Additionally, this case underscores the need for clear and practical contract terms which clearly outline what happens if the agreed process cannot be followed, including who will determine costs and by what method.