Binah Constructions Pty Ltd v PTMG Pty Ltd - [2024] NSWSC 872

Supreme Court

New South Wales

Medium Neutral Citation: Binah Constructions Pty Ltd v PTMG Pty Ltd [2024] NSWSC 872
Hearing dates: 15 July 2024
Decision date: 19 July 2024
Jurisdiction: Equity - Technology and Construction List
Before: Ball J
Decision:
(1) Summons dismissed;
(2) Order that the amount of $48,159.59 paid into Court on 14 June 2024 be paid to the first defendant.

Catchwords:
BUILDING AND CONSTRUCTION — Building and Construction Industry Security of Payment Act 1999 (NSW) — Adjudication — Adjudicated amount — Whether Adjudicator had jurisdiction to award amount in excess of adjudication application — When payment claim quantum exceeds that of adjudication application
BUILDING AND CONSTRUCTION — Building and Construction Industry Security of Payment Act 1999 (NSW) — Adjudication — Judicial review — Whether adjudicator afforded parties procedural fairness under the Building and Construction Industry Security of Payment Act 1999 (NSW)

Legislation Cited:
Building and Construction Industry Security of Payment Act 1999 (NSW)

Cases Cited:
Demex Pty Ltd v McNab Building Services Pty Ltd [2023] NSWCA 261
Downer Construction (Australia) Pty Ltd v Energy Australia (2007) 69 NSWLR 72; [2007] NSWCA 49
Icon Co (NSW) Pty Ltd v Australia Avenue Developments Pty Ltd [2018] NSWCA 339

Category: Principal judgment
Parties: Binah Constructions Pty Ltd (Plaintiff)
PTMG Pty Ltd (First Defendant)
Daniel Fitzpatrick (Second Defendant)
Representation:
Counsel:
DS Weinberger (Plaintiff)
Submitting Appearance (Second Defendant)
Solicitors:
Vincent Young (Plaintiff)
Lauderdale Law (Second Defendant)

File Number(s): 2024/216696
Publication restriction: None

JUDGMENT

Introduction

By a summons dated 12 June 2024, the plaintiff, Binah Constructions Pty Ltd, seeks to quash an adjudication determination of the second defendant (the Adjudicator) in favour of the first defendant, PTMG Pty Ltd, under the Building and Construction Industry Security of Payment Act 1999 (NSW) (the Act) in the sum of $43,059.59. The adjudication determination was made in respect of a payment claim dated 30 April 2024 under a contract dated 6 October 2021 between Binah and PTMG by which PTMG was engaged to provide hydraulic services to Binah in connection with the construction of 25 apartments in Huskisson, New South Wales. Binah was the head contractor for the project.
There was no appearance on behalf of PTMG at the hearing of the matter. I am satisfied that it was properly served and on notice of the hearing. As is normal in these cases, the Adjudicator filed a submitting appearance.

Background

On 26 March 2024, PTMG served progress claim PC 25 claiming an amount of $27,465.07 (including GST). It appears that Binah did not serve a payment schedule in response to that claim within the 10 business days specified in s 14(4)(b)(ii) of the Act. As a consequence, PTMG had a choice under s 15(2) of the Act. It could have sought to recover the amount of the payment claim as a debt due in any court of competent jurisdiction: s 15(2)(a)(i). Alternatively, it could have made an adjudication application under s 17(1)(b): s 15(2)(a)(ii). It did neither of those things. For…

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: [2024] NSWSC 872
Decision Date: 19 July 2024

CaseChat Overview and Summary

In Binah Constructions Pty Ltd v PTMG Pty Ltd, the dispute centred on the jurisdiction and procedural fairness of an adjudication process under the Building and Construction Industry Security of Payment Act 1999 (NSW). Binah Constructions, the principal contractor, challenged the decision of an adjudicator who had awarded a sum greater than the one claimed by Binah in its adjudication application. The adjudicator had awarded a payment to PTMG, the subcontractor, which exceeded the amount Binah had initially sought to pay. The case was heard in the Supreme Court of New South Wales.

The key legal issues before the court were whether the adjudicator had jurisdiction to award an amount greater than that claimed in the adjudication application, and whether the adjudicator afforded the parties procedural fairness as required by the Act. Specifically, the court needed to determine if the adjudicator's decision was within the scope of the authority granted by the Act, and if the process followed adhered to the statutory requirements for procedural fairness. Binah contended that the adjudicator exceeded their jurisdiction and failed to provide adequate procedural fairness.

The court found that the adjudicator had jurisdiction to award the amount they did, as it was within the scope of the dispute referred to adjudication. The court held that the adjudicator's decision was not tainted by jurisdictional error, as the Act allows for the adjudicator to determine the amount they consider just and equitable. Regarding procedural fairness, the court concluded that the adjudicator had afforded the parties a fair process, satisfying the requirements of the Act. The adjudicator's decision was thus upheld.

The final orders of the court dismissed Binah Constructions' application, confirming the adjudicator's decision and affirming the amount awarded to PTMG. Binah's appeal was rejected, and the matter concluded with the adjudicator's determination standing as valid and enforceable.

Orders