Nanshan (Aust) Golf Resort Pty Ltd v Earth Fill Group Pty Ltd (No 2)

Nanshan (Aust) Golf Resort Pty Ltd v Earth Fill Group Pty Ltd (No 2) [2026] FCA 157 is a Federal Court default judgment decision. It is not a final merits judgment after a defended trial. The Court was asked to enter judgment against the second respondent, Mr Roy Mardian, because he had not appeared, filed a defence or taken any active step in the proceeding.

The underlying claim was brought under the Australian Consumer Law. Nanshan alleged that Earth Fill and Mr Mardian made representations about fill material to be supplied and installed at an embankment at Riverside Oaks Golf Resort, including that the material would be Virgin Excavated Natural Material, had been or would be tested, and was or would be compliant with identified Australian Standards. The Court did not finally determine those allegations after hearing both sides. Instead, it held that on the face of the statement of claim, and on the basis that the pleaded facts were taken as admitted for default judgment purposes, Nanshan was entitled to judgment for damages to be assessed.

The commercial dispute arose out of alleged representations about fill material for works at a golf resort. Nanshan was alleged to be the owner and operator of Riverside Oaks Golf Resort. Earth Fill was alleged to operate an earth filling business. Mr Mardian was alleged to be Earth Fill's sole director and shareholder.

According to the statement of claim summarised in the judgment, between 20 July 2022 and February 2023 Earth Fill and Mr Mardian made representations in trade or commerce about fill material to be delivered and installed at an embankment at the resort under a contract to be made, and later made, between Nanshan and Earth Fill. The alleged representations were commercially important. They went to what the material would be, whether it had been or would be tested before delivery, and whether it was or would be compliant with identified Australian Standards.

Nanshan alleged that the material later delivered and installed between 19 October 2022 and February 2023 did not match those representations. The pleaded allegations were that the material was not VENM, was contaminated by asbestos, and was not compliant with the identified standards. Nanshan said it had suffered and would suffer loss and damage in the form of rectification costs and potential exposure to fines and penalties.

That factual account was not tested in a defended hearing in this decision. The immediate procedural issue was that Mr Mardian did not engage with the case. The judgment records that he failed to file an address for service, failed to file a defence within 28 days after service of the statement of claim, and took no active step in the proceeding. The applicant had originally sought default judgment against both respondents, but by the hearing it had learned that Earth Fill had entered liquidation on 4 February 2026. That meant the proceeding against the company was stayed, so the application proceeded only against Mr Mardian.

The legal question before Goodman J was whether the Court should exercise its discretion under rule 5.23 of the Federal Court Rules 2011 (Cth) to enter default judgment against Mr Mardian for damages to be assessed. The Court first had to be satisfied that he was in default under the Rules. It then had to be satisfied that, on the face of the statement of claim, the applicant was entitled to the relief claimed.

The judgment is careful about the standard being applied. The Court referred to authority explaining that default judgment is discretionary and should be exercised cautiously. Importantly, the applicant did not need to prove the whole case by evidence at this stage. The question was whether relief could be granted on the face of the pleading. That is why the decision is best understood as procedural. It shows the difference between a defended trial and a default judgment application.

The substantive ACL issue sitting underneath the procedure question was whether the pleaded allegations, if taken as admitted for default purposes, supported damages under section 236 for contraventions of section 18. The statement of claim alleged that the representations were misleading or deceptive or likely to mislead or deceive. It also alleged that, to the extent the statements were about future matters, Earth Fill and Mr Mardian did not have reasonable grounds for making them. The pleading further alleged that Mr Mardian was involved in the company's contraventions.

The Court also had to account for the company's liquidation. Because Earth Fill had entered liquidation, the proceeding against it was stayed by operation of section 471B of the Corporations Act. That is why the application was narrowed to Mr Mardian alone.

Goodman J held that Mr Mardian was in default. The judgment records three main failures. He had not filed an address for service. He had not filed a defence within 28 days after service of the statement of claim. He had also taken no active step in the proceeding. The Court referred to the earlier service decision and was satisfied there had been deemed service on 16 October 2025. It was also satisfied, from the earlier reasons and from emails tendered at the hearing, that Mr Mardian was on notice of both the proceeding and the default judgment application.

Once default was established, the Court considered whether the pleaded case justified relief. At paragraph 8, the Court said it was satisfied that on the face of the statement of claim, and on the basis that the facts alleged there were taken to have been admitted for this purpose, the applicant was entitled to damages under section 236 of the ACL in respect of alleged contraventions of section 18.

The Court then entered default judgment in favour of Nanshan against Mr Mardian for damages in a sum to be assessed. It referred the assessment of damages to a Registrar acting as referee for report. The proceeding was to be listed again for consideration of the adoption of the referee's report and the disposition of any remaining issues. Mr Mardian was also ordered to pay the applicant's costs of the interlocutory application, as agreed or taxed. The orders included liberty to apply on three days' notice.

The Court also noted that entering default judgment in these circumstances was consistent with the overarching purpose in section 37M of the Federal Court of Australia Act, namely resolving disputes as quickly, inexpensively and efficiently as possible where a party has materially failed to act without an adequate explanation.

There are two separate business readings of this case. The first is about representations in trade or commerce. If your business says materials are clean, uncontaminated, tested, compliant with standards, or suitable for a particular use, those statements can become central in an ACL claim. That is especially so where the statements are technical and commercially important to the customer. The pleaded case here shows how a dispute can be framed when a customer says the delivered material did not match what was promised.

The second reading is procedural and immediate. If a business, director or owner-manager ignores a Federal Court proceeding, the Court may proceed on the pleadings. That does not mean every allegation has been proved after a trial. But it does mean the respondent may lose the chance to contest liability before the matter moves to damages assessment. In practical terms, silence can hand the applicant a major procedural advantage.

This case also shows the potential personal exposure of individuals. The pleading alleged that Mr Mardian personally made the representations and was involved in the company's conduct. The Court entered default judgment against him personally because that was the case pleaded and he did not defend it. Directors who speak directly to customers about quality, testing or compliance should keep in mind that personal involvement can matter.

Businesses should also notice the future matters point. The statement of claim alleged that, to the extent the representations were about future matters, there were no reasonable grounds for making them. That is a recurring ACL risk area. If you say testing will occur, a product will meet a standard, or a material will have a particular status on delivery, you should have a proper basis for saying so at the time.

For many businesses, the practical value of this case lies in document discipline. Representations are often made across quotes, emails, proposals, delivery discussions and project communications, not just in a formal contract. If your business supplies materials or technical services, align your sales language with what you can actually verify. If a statement depends on supplier information, testing results or third-party certification, make sure that support exists before the statement is passed on to the customer.

Where a representation concerns contamination status, testing or standards compliance, keep the underlying records. That may include test reports, chain-of-supply information, specifications, approvals, internal sign-off records and communications showing what was known at the time the statement was made. If the statement is forward-looking, keep records showing the basis for making it.

On the dispute side, have a process for handling court documents. Someone in the business should be responsible for identifying service, diarising deadlines and obtaining advice quickly. A failure to file an address for service or defence can have immediate consequences. Even where a business believes the claim is weak, the safer course is to respond properly and preserve its position.

The case also shows how insolvency can change the shape of litigation. Once Earth Fill entered liquidation, the proceeding against it was stayed. That did not end the matter against the individual respondent. Businesses dealing with distressed counterparties should get advice early about the effect of any stay and whether claims against other parties remain available.

Does default judgment mean the applicant automatically wins every allegation? Not exactly. The Court still has to be satisfied that the pleaded case supports the relief sought. But if the respondent does not defend the case, the Court may treat the pleaded facts as admitted for the purpose of deciding whether judgment should be entered.

Can damages still be substantial even if they are assessed later? Yes. A default judgment on liability can be a major turning point. The respondent may then face a separate process dealing with the amount of loss, costs and any remaining issues.

Is this only relevant to earthworks businesses? No. The same risk pattern can arise in manufacturing, supply, construction, waste, logistics, food, health products and any other sector where businesses make quality, testing or compliance statements.

Does a company liquidation end the whole case? Not necessarily. Here, the proceeding against the company was stayed, but the applicant still pursued the individual respondent on the default judgment application.

The judgment was delivered on 25 February 2026. It records that there had been deemed service of the originating application and statement of claim on 16 October 2025, based on reasons given in an earlier decision. It also records that Earth Fill entered liquidation on 4 February 2026, which stayed the proceeding against the company. The orders made on 25 February 2026 entered default judgment against Mr Mardian only, with damages to be assessed later.

That means this decision should be read as an intermediate procedural step rather than the end of the dispute. Liability was dealt with only in the default judgment sense. Quantum remained to be assessed by a Registrar acting as referee, with the matter to return to the Court for consideration of the report and any remaining issues.

This page is based on the published Federal Court judgment in Nanshan (Aust) Golf Resort Pty Ltd v Earth Fill Group Pty Ltd (No 2) [2026] FCA 157. Because the judgment is a short default judgment ruling, the available public account is strongest on procedure, the pleaded allegations and the orders made. It is not a full trial judgment resolving disputed evidence about the fill material, contamination or standards compliance.

Readers should therefore treat the factual narrative as the pleaded case accepted on its face for default judgment purposes. The most reliable practical lessons are about the risk of making unsupported quality or compliance representations and the danger of failing to respond to court proceedings.