The NSW Supreme Court has awarded Clarke Energy 142 days of extensions of time in a dispute over a gas-fired power station in Western Australia. The extensions substantially reduced Clarke’s liability for delay, but did not eliminate it. Rees J calculated liquidated damages of $2.88 million, reduced to $2,502,365 after an agreed credit for early generation.
In Clarke Energy (Australia) Pty Ltd v Alinta Energy Transmission (Roy Hill) Pty Ltd [2026] NSWSC 1124, decided on 21 September 2026, the Court entered judgment for $7,192,414 in Clarke’s favour, subject to further calculations and interest. That amount reflected unpaid milestones, the site amenities claim and delay costs, after setting off liquidated damages.
The approximately $78 million engineering, procurement and construction contract was governed by Western Australian law. The judgment examines how its detailed allocation of responsibilities operated when site preparation, workforce availability and commissioning did not proceed as planned.
Site access had to allow the planned work
Alinta was responsible for removing existing underground services before Clarke began bulk earthworks. The Court rejected the argument that Clarke’s general site preparation obligations included that task. Clarke’s acceptance of the site conditions also did not extend to whatever condition Alinta left behind after excavating the site.
Alinta had to backfill and compact the disturbed areas consistently with their condition before its works. Its failure to provide the access needed for bulk earthworks supported an extension of time. The Court nevertheless rejected Clarke’s separate argument that Alinta breached its obligations merely by issuing the notice to proceed when it did.
On projects involving existing energy assets, the contract should identify who performs the preparatory work and how the site must be left. An access date alone may leave a substantial part of that task unresolved.
Conduct affected reliance on notice requirements
Clarke initially failed to copy the superintendent on its first extension claim and relevant delay notices. Alinta relied on that omission to argue that the claim was barred, despite the superintendent eventually assessing it on its merits almost two years later.
Rees J found that Alinta had waived reliance on the relevant conditions precedent. The contractual assessment process had broken down, and Alinta later instructed the replacement superintendent to determine the claim substantively. That conduct was inconsistent with insisting that the claim should simply be rejected for the notification failure. The contract’s no-waiver clause did not prevent that conclusion.
The finding depended on the parties’ conduct. Contractors should still serve notices on every required recipient within the contractual period. Principals need to consider whether the way they administer a claim is consistent with the procedural rights they seek to retain.
In alternative reasoning, Rees J found that the contract did not exclude the prevention principle, which concerns a party’s interference with the performance it seeks to enforce. Alinta’s reserve power to extend time was expressed as an absolute discretion. However, the clause lacked the additional wording excluding any obligation to consider an extension that had mattered in Growthbuilt. Her Honour would have required Alinta to exercise that power for delay it had caused. This conclusion turned on the drafting and circumstances; it does not give contractors a general basis to disregard time bars.
Extensions depended on delay to practical completion
The four extensions allowed were 92 days for the initial site access delay, 27.5 days for COVID-19 workforce disruption, 16 days for the relay panel works and 6.5 days for commissioning network availability. No delay costs were sought for the COVID-19 extension.
The relay panel delay arose from Alinta’s failure to engage with the methodology and isolation arrangements. The commissioning delay concerned its obligation to provide a network capable of receiving the station’s output.
Clarke did not recover every day claimed. The Court excluded additional days sought to restore lost activity float, meaning time an activity could slip before delaying completion. It also excluded 1.5 days from the commissioning claim for concurrent delay. Under this contract, the relevant question was the effect on practical completion.
The contract required time impact analysis. For the site access claim, the Court accepted a later program logic change as evidence that the earlier program was not reasonable or achievable. It did not treat the sequence ultimately used on site as decisive. The assessment depended on reliable programs and records explaining why they changed.
Completion turned on the agreed tests
The Court found practical completion occurred on 10 November 2022, when the relevant test results were provided to Alinta. It applied the contractual completion requirements and guarantee tests, including whether the level of alarms during those tests was satisfactory. Alinta’s broader concerns about design performance did not replace those requirements.
Project teams should check the agreed completion criteria before treating an outstanding issue as preventing certification. This contract allowed qualifying minor defects, and the Court accepted that the guarantee test passed despite temporary generator de-rating.
The superintendent’s role needed protection
Alinta replaced a superintendent after he privately indicated that he was minded to certify practical completion. The Court found that the replacement was partly intended to avoid that outcome. It criticised both the private communication and the interference with the certification process. The contractual replacement power had to be exercised consistently with the duty to cooperate.
That criticism did not establish personal liability in negligence. The claims against the superintendents failed because Clarke lacked the necessary vulnerability to economic loss. It was an experienced, legally advised commercial party with contractual protections and rights to challenge determinations.
Delay costs and other claims
The delay cost clause allowed reasonable rates incorporating margin, together with overheads and profit. The Court rejected recovery limited to bare wages or expenditure. That interpretation depended on this contract’s wording and the evidence.
For the initial site access delay, Clarke’s alternative Australian Consumer Law and estoppel arguments did not succeed. Alinta’s failure to remove services as promised did not establish that its earlier representations were misleading when made, or that it had promised to abandon the extension-of-time requirements.
The separate site amenities claim had a different result. Clarke recovered $69,000 through promissory estoppel, although it had not obtained the formal variation order required for payment under the contract. The Court accepted that Clarke had commissioned the additional work in reliance on Alinta’s assurance about the variation process.