By Andrew Starke

The Supreme Court of NSW has ruled in favour of the ivy complex in the latest instalment of a long-running legal battle between Hemmes Hermitage and builders Lucas Stuart.

The victory for Justin Hemmes means the hotel mogul can now convert $1.6 million worth of performance bonds he has with the builder’s insurance company if Lucas Stuart does not correct structural defects in the ivy identified by Hemmes Hermitage.

The builder had sought to prevent Hemmes from converting the unconditional performance bonds.

“We believe the judgment justifies our position that the builder needs to comply with its contractual obligations and we look forward to the rectification works commencing shortly,” a spokesperson for Hemmes Hermitage told TheShout.

Court proceedings were initiated in 2009 with the builders suing over an unpaid bill while Hemmes Hermitage claimed there were 1324 general defects and 197 items of water leaks that needed to be rectified.

Under the ruling, Hemmes will be able to use the bond proceeds to address these problems if the builder doesn’t fix them by June 30, 2011.

The Supreme Court of NSW initially ruled in favour of the builders, finding in May last year that Hemmes Hermitage owed Lucas Stuart $4.57 million over a disagreement relating to costs incurred over the construction period.

However Hemmes said at the time that the ruling was based on a ‘legal technicality’ and countersued Stuart’s parent company, AJ Lucas, for $11 million over alleged ‘defects and delays’ in the creation of the ivy entertainment complex.

Ironically the multi-million dollar venue won two prestigious design awards last year, with the Australian Institute of Architects’ National Architecture Awards recognising its impact with the Harry Seidler Award for Commercial Architecture and the National Award for Urban Design.

The Shout Team

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