When Basics Go Wrong – Lessons from Bettar Holdings vs RWC Brookvale

The recent decision in Bettar Holdings Pty Ltd v RWC Brookvale Investment Pty Ltd [2025] NSWCA 242 is a striking reminder that even today, disputes can still arise over the most fundamental principles of contract law – intention to create legal relations and authority to contract.

The Facts

The case concerned a tender for construction management services on a major development at Brookvale. Bettar Holdings (the tenderer) engaged in negotiations with Hannas Contracting Services (the development manager) appointed by RWC (the developer). Bettar Holdings believed that by late October 2023, the parties had reached an agreement – or at least an arrangement – sufficient to trigger rights under the Building and Construction Industry Security of Payment Act 1999 (NSW). Bettar Holdings commenced work and later served a payment claim, asserting a statutory debt.

The NSW Supreme Court of Appeal disagreed. It found that no binding contract existed, no estoppel arose and no “other arrangement” within the meaning of the Act had been established.

At the heart of the dispute was an email Hannas sent on 27 October 2023. Bettar Holdings relied heavily on this email, arguing that it confirmed agreement on commercial terms and provided assurance to “push forward.” But the Court held that the email was carefully worded to avoid any immediate commitment. It referred to Hannas’ intention to send a letter of intent and a draft contract the following week and to execute a contract only once terms were agreed. Objectively assessed, this language placed the case squarely within the third category of Masters v Cameron: negotiations subject to a formal written contract. There was no intention to be immediately bound.

The second issue was authority. Bettar Holdings assumed that Hannas had power to bind RWC. That assumption proved fatal. The Court found no evidence that RWC had conferred actual authority on Hannas to enter a major contract on RWC’s behalf

What could Bettar Holdings have done differently?

The judgment offers a clear hint. Bettar Holdings attempted to use urgency as leverage, pressing for a commitment before commencing work. A more prudent approach would have been to insist on a signed written contract before starting, even if that meant losing the job.

Bettar Holdings could have also:

• clarified the scope of Hannas’ authority.
• set firm boundaries: no work until contractual formalities were complete.
• assessed its position more objectively.

The 27 October email, while positive in tone, signalled no immediate intention to be bound – quite the opposite. And when negotiations later collapsed, Bettar Holdings did not pursue a quantum meruit claim for work performed after that date, a step that might have allowed it to recover at least some payment.

What could RWC have done differently?

RWC, though ultimately successful and awarded indemnity costs for part of the proceedings, could also have handled matters more effectively. Litigation is expensive and victory does not eliminate the risk of non-recovery due to insolvency, out of pocket legal costs or the opportunity cost of management time.

RWC (through Hannas) could have avoided the dispute entirely by being more direct. It could have:

• stated unequivocally that no contract would exist until a formal agreement was signed.
• avoided requesting any work before a binding letter of intent or contract was in place.
• been more disciplined about authority protocols.

Keeping Bettar Holdings ‘on the hook’ may have created false impressions and increased the psychological motivations to litigate. Clear communication would have significantly reduced these risks.

Lessons

The broader lesson is simple yet powerful: disputes can still arise over the most basic elements of contract formation when parties fail to communication clearly. In high-pressure commercial environments, honesty and directness are not just virtues – they are essential risk management tools. This case is a cautionary tale for principals and contractors alike: never assume, never rely on informal assurances and never underestimate the importance of clear communication.

This communication is sent by Kreisson Legal Pty Limited (ACN 113 986 824). This communication has been prepared for the general information of clients and professional associates of Kreisson Legal. You should not rely on the contents. It is not legal advice and should not be regarded as a substitute for legal advice. The contents may contain copyright.