Abigroup Contractors Pty Ltd v River Street Developments Pty Ltd - [2006] VSC 425

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY
BUILDING CASES LIST

No. 4695 of 2006

ABIGROUP CONTRACTORS PTY LTD (ACN 000 201 516)	Plaintiff
v
RIVER STREET DEVELOPMENTS PTY LTD (ACN 096 725 558)	Defendant

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JUDGE:	HABERSBERGER J
WHERE HELD:	Melbourne
DATE OF HEARING:	22 MAY 2006
DATE OF JUDGMENT:	10 NOVEMBER 2006
CASE MAY BE CITED AS:	Abigroup Contractors Pty Ltd v River Street Developments Pty Ltd
MEDIUM NEUTRAL CITATION:	[2006] VSC 425

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BUILDING CONTRACT – Building and Construction Industry Security of Payment Act 2002 ss.9, 14, 15, 16 – Payment claim – Payment schedule – Whether service of payment claim on agent of Principal satisfied requirements of s.14(1) of the Act.

PROCEDURE – Summary judgment application – Whether real question to be tried.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr JWK Burnside QC with Mr CM Caleo	Clayton Utz
For the Defendant	Mr EJ Delany SC with Mr R Andrew	Phillips Fox

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HIS HONOUR:

This is an application by the plaintiff, Abigroup Contractors Pty Ltd (“Abigroup”), for summary judgment against the defendant, River Street Developments Pty Ltd (“RSD”), in the sum of $4,568,787.94 plus GST, together with interest to the date of judgment and the costs of this proceeding. Abigroup’s claim was made pursuant to the provisions of the Building and Construction Industry Security of Payment Act 2002 (“the Act”).

The Factual Background

On 31 October 2003 Abigroup entered into a building contract with RSD under which Abigroup agreed to design and construct the Riviera Apartments at 69-73 River Street, Richmond for the sum of $68,654,467 (“the Contract”). Trevor Main & Associates Pty Ltd (“TMA”) was named in Annexure Part A of the Contract as the Superintendent under the Contract. Clause 42.1(j)(ii) of the Contract stated that in cl. 42.1 the term “Quantity Surveyor” meant David Stewart of WT Partnership Australia Pty Ltd (“WTP”).

Clause 42.1(b) of the Contract provided that at the times for payment claims stated in Annexure Part A, which was the 28^th day of each month:

“... the Contractor shall deliver to the Quantity Surveyor and the Superintendent claims for payment supported by evidence of the amount due to the Contractor and such information as the Quantity Surveyor may reasonably require. Claims for payment shall include the value of work carried out by the Contractor in the performance of the Contract to that time, including the supply of unfixed (but on-site) goods and materials and (subject to Clause 42.2) off-site goods and materials together with all amounts then otherwise due to the Contractor arising out of the Contract...”

Relevantly, cl. 42.1 also provided as follows:

“(e)Within 10 Business Days (being the maximum time allowed under section 15 of the Building and Construction Industry Security of Payment Act 2002 (Vic) (‘Security of Payment Act’) of receipt of a claim for payment, the Quantity Surveyor shall assess the claim (on a Cost to Complete Basis) and shall issue to the Principal and to the Contractor (with…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2006] VSC 425
Decision Date: 10 November 2006

CaseChat Overview and Summary

Abigroup Contractors Pty Ltd commenced proceedings against River Street Developments Pty Ltd for a payment dispute under the Building and Construction Industry Security of Payment Act 2002 (the Act). Abigroup, the subcontractor, sought the adjudication of a payment claim and, ultimately, payment from River Street, the principal contractor. The matter came before the court on a summary judgment application, where the primary issue was whether the service of the payment claim on an agent of River Street satisfied the requirements of section 14(1) of the Act.

The court had to determine if the service of the payment claim on an agent of River Street Developments complied with section 14(1) of the Act. The Act requires that payment claims be served on the principal, and Abigroup argued that serving the claim on an agent of River Street was sufficient. River Street contended that the claim was not properly served as it was not directly served on the principal, thus questioning the enforceability of the claim under the Act. The court considered whether the service on the agent constituted compliance with the statutory requirements and whether there was a real question to be tried.

In its decision, the court found that the service of the payment claim on an agent of River Street Developments was not in compliance with section 14(1) of the Act, which requires direct service on the principal. The court held that there was no ambiguity in the statutory language and that serving the claim on an agent was not sufficient to meet the Act's requirements. Consequently, the court ruled that there was no real question to be tried and granted the summary judgment application in favour of River Street. The court held that the payment claim was not validly served, and therefore, the claim could not proceed under the Act.

The court ordered that the proceedings be dismissed with costs.

Orders