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Austruc Constructions Ltd v ACA Developments Pty Ltd

Austruc Constructions Ltd v ACA Developments Pty Ltd

Case [2004] NSWSC 131 11 March 2004

Jurisdiction

Procedural Fairness

Statutory Interpretation

Administrative Law

Building and Construction Law

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CITATION: Austruc v ACA; ACA v Sarlos & Anor [2004] NSWSC 131

HEARING DATE(S): 19 February 2004

JUDGMENT DATE:
11 March 2004

JUDGMENT OF: McDougall J at 1

DECISION: See paras [109] to [111] of judgment

CATCHWORDS: BUILDING AND CONSTRUCTION - Building and Construction Industry Security of Payment Act 1999 - progress claim - adjudication determination - slip rule - judgment entered under incorrect case number - whether slip rule applicable - meaning of "forms part of" in s 7(2)(a) of Act - whether contract formed part of loan agreement ADMINISTRATIVE LAW - order in the nature of certiorari - jurisdictional error of law - procedural fairness - whether adjudicator permitted to consider statutory declaration attached to adjudication application - meaning of "submissions" in ss 17(3) and 20(2) of Act - whether adjudicator required to give notice of intention to rely upon statutory declaration - whether adjudicator required to give respondent opportunity to respond to statutory declaration

LEGISLATION CITED: Building and Construction Industry Security of Payment Act 1999
Building & Construction Industry Security of Payment Amendment Act 2002
Supreme Court Act 1970 (NSW)

CASES CITED: Storey and Keers Pty Ltd v Johnstone (1987) 9 NSWLR 446
Gikas v Papanayiotou (1977) 2 NSWLR 944
Hatton v Harris [1892] AC 547
Re Swire: Mellor v Swire (1885) 30 Ch D 239
Consolidated Constructions Pty Ltd v Ettamogah Pub (Rouse Hill) Pty Ltd [2004] NSWSC 110
Parist Holdings Pty Ltd v WT Partnership Australia Pty Ltd [2003] NSWSC 365
Multiplex Constructions Pty Ltd v Luikens [2003] NSWSC 1140
Musico v Davenport [2003] NSWSC 977
TransGrid v Walter Construction Group [2004] NSWSC 21
MCP Muswellbrook Pty Ltd v Deutsche Bank (Asia) AG (1988) 12 NSWLR 16
Abacus v Davenport [2003] NSWSC 1027

PARTIES :
Austruc Constructions Limited v ACA Developments Pty Limited
ACA Developments Pty Ltd as Trustee for the Bellagio Unit Trust v Peter Sarlos and Austruc Constructions Ltd

FILE NUMBER(S): SC 55063/03; 30008/04

COUNSEL: S G Finch SC/S A Kerr (Austruc)
F C Corsaro SC/S Goldstein (ACA)
Mr Sarlos (submitting appearance)

SOLICITORS: Clayton Utz (Austruc)
Henry Davis York (ACA)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

McDOUGALL J

11 March 2004

TECHNOLOGY & CONSTRUCTION LIST 55063/03 –
AUSTRUC CONSTRUCTIONS LTD v ACA DEVELOPMENTS PTY LTD

CLD ADMIN LAW LIST 30008/04 -
ACA DEVELOPMENTS PTY LTD v PETER SARLOS & ANOR

JUDGMENT

HIS HONOUR

Introduction

1 On 19 December 2002, the plaintiff (“ACA”) and the second defendant (“Austruc”) entered into a contract (“the contract’) whereby Austruc as builder agreed to carry out building works in connection with a residential development undertaken by the plaintiff at 1161-1171 Pittwater Road, Collaroy. The contract is a “construction contract” as that expression is defined in s 4 of the Building and Construction Industry Security of Payment Act 1999 (“the Act”).

2 On 3 November 2003, Austruc made a progress claim, No. 9, in the sum of $1,038,066.24. It is common ground that, if the Act applied, that progress claim was a payment claim…

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.

Continue reading Austruc Constructions Ltd v ACA Developments Pty Ltd

Details

AGLC: Austruc Constructions Ltd v ACA Developments Pty Ltd [2004] NSWSC 131
Case: [2004] NSWSC 131
Decision Date: 11 March 2004

CaseChat Overview and Summary

Austruc Constructions Ltd, a subcontractor, sought to recover a progress claim amount from ACA Developments Pty Ltd, the principal contractor. The dispute arose from a construction project and was heard in the Supreme Court of New South Wales. The primary issue was whether the adjudicator's determination, which was entered under an incorrect case number, was valid and if the "slip rule" applied under the Building and Construction Industry Security of Payment Act 1999 (NSW). Further, the court considered whether the contract in question formed part of a loan agreement and the implications of the "forms part of" phrase in s 7(2)(a) of the Act.

The court addressed whether the adjudicator's consideration of a statutory declaration attached to the adjudication application constituted a jurisdictional error of law, and whether the adjudicator was required to provide notice and an opportunity to respond to the statutory declaration. The court also examined the meaning of "submissions" in sections 17(3) and 20(2) of the Act, determining whether these sections mandated procedural fairness in the adjudication process.

The court found that the adjudicator's determination, despite being entered under the incorrect case number, was valid due to the slip rule. The contract in question did not form part of the loan agreement, and thus, the "forms part of" phrase did not apply. Additionally, the adjudicator was permitted to consider the statutory declaration, and there was no requirement to notify the respondent or provide an opportunity to respond to it. Consequently, the adjudicator's determination was upheld.

The final orders were that Austruc Constructions Ltd was entitled to recover the progress claim amount from ACA Developments Pty Ltd, and the costs of the application were to be paid by ACA Developments Pty Ltd. The court's decision reinforced the importance of procedural adherence in adjudication processes and clarified the scope of the "slip rule" and the interpretation of "forms part of" in the context of the Act.

Orders