A contractual clause conditioning the right to call on performance bonds on the contractor having 'not materially complied with its obligations' requires an assessment of whether the contractor has materially failed to comply with its obligations viewed as a whole — it is not satisfied merely by proof of any breach of a 'main obligation'. The condition precedent is one of objective fact, not dependent on the principal's satisfaction or bona fide belief. Clough Engineering v Oil & Natural Gas Corporation (2008) 249 ALR 458 is distinguishable where the contract does not contain wording equivalent to the pro forma performance bond in Clough that qualified the condition precedent. When seeking an interlocutory injunction in equity's auxiliary jurisdiction to restrain breach of a negative contractual stipulation, the applicant must demonstrate a serious question to be tried not only as to the breach but also as to the inadequacy of legal remedies.
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