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Bloc Constructions (ACT) Pty Ltd v ABS Façade (ACT) Pty Ltd

Bloc Constructions (ACT) Pty Ltd v ABS Façade (ACT) Pty Ltd

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FEDERAL COURT OF AUSTRALIA
Bloc Constructions (ACT) Pty LTD v ABS Façade (ACT) Pty Ltd [2023] FCA 1282

File number(s): ACD 36 of 2022

Judgment of: PERRY J

Date of judgment: 25 October 2023

Catchwords:
ADMINISTRATIVE LAW — where the applicant and first respondent entered into a construction contract — where adjudicator made an adjudication determination between the applicant and first respondent — whether the adjudicator's decision was invalid for jurisdictional error because the first respondent did not provide a valid payment claim within the meaning of the Building and Construction Industry (Security of Payment) Act 2009 (ACT) — whether the payment claim sufficiently identified the construction work to which the claim related in order to satisfy s 15(2)(a) of the Act — where impugned payment claim included same methodology as previous payment claims — no error demonstrated

ADMINISTRATIVE LAW — whether the adjudicator determined an amount “to be paid”, as required by s 24(1)(a) of the Act — where face of adjudication decision and its reasons make clear the amount to be paid

ADMINISTRATIVE LAW — consideration of reference dates arising under the contract — whether reference date arose under a progress payment or a final payment — where final payment depends upon practical completion of the project, and practical completion had not been achieved — whether Cat Protection Society of Victoria v Arvia Pty Ltd [2018] VSC 757 distinguishable

Legislation:
Australian Capital Territory (Self-‍Government) Act 1988 (Cth) s 48A

Jurisdiction of Courts (Cross-‍Vesting) Act 1987 (Cth) s 9(3)

Building and Construction Industry Payments Act 2004 (Qld) s 17(2)(a)

Building and Construction Industry Security of Payment Act 1999 (NSW) ss 8(1), 13(1) and 13(2)

Building and Construction Industry Security of Payment Act 2002 (Vic) s 14(2)(c)

Building and Construction Industry (Security of Payment) Act 2009 (ACT) ss 6(1)(a), 6(1)(b), 6(2), 10, 11, 13, 14, 15, 16, 17(1)-(2), 19, 24, 25, 26(1)–‍(3), 27(1), 38

Building Industry Fairness (Security of Payment) Act 2017 (Qld) s 68(1)

Cases cited:
AgriWealth Capital Limited v Australian Financial Complaints Authority Limited [2023] FCAFC 118

Brodyn Pty Ltd v Davenport [2003] NSWSC 1019

Cat Protection Society of Victoria v Arvio Pty Ltd [2018] VSC 757

Collector of Customs v Pozzolanic Enterprises Pty Ltd [1993] FCA 456; (1993) 43 FCR 280

Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner [2020] FCAFC 192; (2020) 282 FCR 1

Coordinated Construction Co Pty Ltd v Climatech (Canberra) Pty Ltd [2005] NSWCA 229; (2005) 21 BCL 364

Corporation of the City of Enfield v Development Assessment Commission [2000] HCA 5; (2000) 199 CLR 135

Crosby v Kelly [2012] FCAFC 96; (2012) 203 FCR 451

Equuscorp Pty Ltd v Glengallan Investments Pty Ltd [2004] HCA 55; (2004) 218 CLR 471

Faull v Commissioner for Social Housing [2013] ACTSC 121; (2013) 277 FLR 61

Hazeldell Ltd v Commonwealth [1924] HCA 36; (1924) 34 CLR 442

Isis Projects Pty Ltd v Clarence Street Pty Ltd [2004] NSWSC 714

KDV Sport…

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: [2023] FCA 1282
Decision Date: 25 October 2023

CaseChat Overview and Summary

The case of Bloc Constructions (ACT) Pty Ltd v ABS Façade (ACT) Pty Ltd concerns a dispute between the applicant and the first respondent over a construction contract. The matter was brought before the court as an application for judicial review, seeking to overturn an adjudicator’s determination in favour of the first respondent. The primary contentions were whether the adjudicator's decision was valid and whether the payment claim provided by the first respondent was sufficient under the Building and Construction Industry (Security of Payment) Act 2009 (ACT).

The legal issues central to the case involved the validity of the adjudicator's decision and the adequacy of the payment claim provided by the first respondent. Specifically, the court had to determine if the adjudicator's decision was valid despite the first respondent's alleged failure to provide a valid payment claim as required by s 15(2)(a) of the Act. Additionally, the court needed to ascertain whether the adjudicator correctly determined an amount “to be paid” as per s 24(1)(a) of the Act. The court also considered the implications of the reference dates under the contract, particularly whether these dates were tied to progress payments or final payments, and whether the case of Cat Protection Society of Victoria v Arvia Pty Ltd [2018] VSC 757 was distinguishable.

The court found that the payment claim provided by the first respondent did not constitute a jurisdictional error because it sufficiently identified the construction work to which the claim related, in line with s 15(2)(a) of the Act. The court also held that the adjudicator’s decision clearly stated the amount to be paid, satisfying the requirements of s 24(1)(a) of the Act. Moreover, the court determined that the reference dates under the contract pertained to progress payments, not final payments, and were not invalidated by the case of Cat Protection Society of Victoria v Arvia Pty Ltd [2018] VSC 757. Consequently, the application for judicial review was dismissed, and costs were awarded to the first respondent.

Orders

Orders of the court

1. The Originating Application dated 3 August 2022 be dismissed.

2. The applicant is to pay the first respondent’s costs of the application as agreed or taxed.

3. The moneys paid into the Court by the order made on 3 August 2022 be paid to the solicitors for the first respondent on or before 4pm on Thursday 9 November 2023.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Section 24 in-‍turn outlines the requirements of the adjudicator’s decision. That provision relevantly provides:Adjudicator’s decision(1)The adjudicator for an adjudication application must decide—(a)the amount of the progress payment, if any, to be paid by the respondent to the claimant (the adjudicated amount); and(b)the day on which the amount became or becomes payable; and(c)the rate of interest payable on the amount.(Emphasis in original.)The operation of s 24(1)(a) of the Act is directly raised by the second basis for Bloc Constructions’ application for judicial review. The consequences of an adjudication decision are outlined, amongst others, in ss 25–‍27 of the Act. Unless specified, a respondent is required to pay an adjudicated amount within 5 business days after the day on which the adjudicator’s decision is given: s 25 of the Act. If the respondent fails to pay the adjudicated amount, the claimant may provide an adjudication certificate specifying (amongst others) the adjudicated amount: s 26(1)–‍(3) of the Act. That certificate may be filed and enforced as a judgment for a debt: s 27(1) of the Act.4. THE JUDICIAL REVIEW APPLICATION4.1 Matters in issue The judicial review application originally raised a wide-‍array of issues. As I have indicated, prior to the hearing, the parties narrowed the issues in dispute considerably. Before me, the following issues are no longer in dispute for the purposes of this application:(1)whether there was a binding agreement between the parties—in this respect and bearing in mind s 38 of the Act, the parties filed an Agreed Fact stating that “for the purposes of this proceeding only, the parties agree that at all material times the applicant and the first respondent were bound by the terms of the draft Major Works Subcontract”;(2)whether there had been a formal “Handover Agreement” between ABS Façade and a replacement contractor, to complete the remaining façade works following ABS Façade’s exit from the development; and(3)whether the adjudicator had erred in law in finding that the retentions clause in the contract was a “pay when paid clause”, and so voided by s 14 of the Act. I identified at the outset of these reasons the three remaining bases on which relief is sought by Bloc Constructions and address each in turn below. 4.2 The first ground: whether the payment claim failed to identify the construction work or related goods and services to which it related By the first ground of their judicial review application, Bloc Constructions contends that payment claim seven submitted on 13 May 2022 failed to comply with s 15(2)(a) of the Act. It will be recalled that s 15(2)(a) of the Act provides that “a payment claim must identify the construction work or related goods and services to which the progress payment relates”. Bloc Constructions contends that the purported payment claim on 13 May 2022 did not comply with s 15(2)(a) of the Act, and that the adjudicator therefore lacked jurisdiction to make the determination.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

File number(s):	ACD 36 of 2022
Judgment of:	PERRY J
Date of judgment:	25 October 2023
Catchwords:	ADMINISTRATIVE LAW — where the applicant and first respondent entered into a construction contract — where adjudicator made an adjudication determination between the applicant and first respondent — whether the adjudicator's decision was invalid for jurisdictional error because the first respondent did not provide a valid payment claim within the meaning of the Building and Construction Industry (Security of Payment) Act* 2009* (ACT) — whether the payment claim sufficiently identified the construction work to which the claim related in order to satisfy s 15(2)(a) of the Act — where impugned payment claim included same methodology as previous payment claims — no error demonstrated ADMINISTRATIVE LAW — whether the adjudicator determined an amount “to be paid”, as required by s 24(1)(a) of the Act — where face of adjudication decision and its reasons make clear the amount to be paid ADMINISTRATIVE LAW — consideration of reference dates arising under the contract — whether reference date arose under a progress payment or a final payment — where final payment depends upon practical completion of the project, and practical completion had not been achieved — whether Cat Protection Society of Victoria v Arvia Pty Ltd [2018] VSC 757 distinguishable
Legislation:	*Australian Capital Territory (Self-‍Government) Act 1988* (Cth) s 48A Jurisdiction of Courts (Cross-‍Vesting) Act 1987 (Cth) s 9(3) Building and Construction Industry Payments Act 2004 (Qld) s 17(2)(a) Building and Construction Industry Security of Payment Act 1999 (NSW) ss 8(1), 13(1) and 13(2) Building and Construction Industry Security of Payment Act 2002 (Vic) s 14(2)(c) Building and Construction Industry (Security of Payment) Act 2009 (ACT) ss 6(1)(a), 6(1)(b), 6(2), 10, 11, 13, 14, 15, 16, 17(1)-(2), 19, 24, 25, 26(1)–‍(3), 27(1), 38 Building Industry Fairness (Security of Payment) Act 2017 (Qld) s 68(1)
Cases cited:	AgriWealth Capital Limited v Australian Financial Complaints Authority Limited [2023] FCAFC 118 Brodyn Pty Ltd v Davenport [2003] NSWSC 1019 Cat Protection Society of Victoria v Arvio Pty Ltd [2018] VSC 757 Collector of Customs v Pozzolanic Enterprises Pty Ltd [1993] FCA 456; (1993) 43 FCR 280 Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner [2020] FCAFC 192; (2020) 282 FCR 1 Coordinated Construction Co Pty Ltd v Climatech (Canberra) Pty Ltd [2005] NSWCA 229; (2005) 21 BCL 364 Corporation of the City of Enfield v Development Assessment Commission [2000] HCA 5; (2000) 199 CLR 135 Crosby v Kelly [2012] FCAFC 96; (2012) 203 FCR 451 Equuscorp Pty Ltd v Glengallan Investments Pty Ltd [2004] HCA 55; (2004) 218 CLR 471 Faull v Commissioner for Social Housing [2013] ACTSC 121; (2013) 277 FLR 61 Hazeldell Ltd v Commonwealth [1924] HCA 36; (1924) 34 CLR 442 Isis Projects Pty Ltd v Clarence Street Pty Ltd [2004] NSWSC 714 KDV Sport…