Boutique Developments Ltd v Construction & Contract Services Pty Ltd - [2007] NSWSC 1042

CITATION: Boutique Developments Ltd v Construction & Contract Services Pty Ltd & Anor [2007] NSWSC 1042
This decision has been amended. Please see the end of the judgment for a list of the amendments.

JUDGMENT OF: Gzell J

EX TEMPORE JUDGMENT DATE: 31 August 2007

DECISION: Application dismissed with costs.

CATCHWORDS: JUDGMENTS - Administrative Law - Particular Tribunals or bodies - Injunction sought to restrain the determination of an adjudication application under the Building and Construction Industry Security of Payment Act 1999 - Whether expert reports in aid of an action against a third party insurer for defects in construction fall within the definition of "construction work" in s 5(1) or "related goods or services" in s 6(1) - Whether the jurisdiction law entitlement question should be decided by the Court

LEGISLATION CITED: Building and Construction Industry Security of Payment Act 1999

CASES CITED: Australian Remediation Services Pty Ltd v Earth Tech Engineering Pty Ltd & Anor [2005] NSWSC 362
Brodyn Pty Ltd v Davenport & anor [2004] NSWCA 394
Lifestyle Retirement Products No 2 Pty Ltd v Parisi Homes Pty Ltd & Anor [2005] NSWSC 411
Veolia Water Solutions & Technologies v Kruger Engineering Australia Pty Ltd [2006] NSWSC 1406

PARTIES: Boutique Developments Ltd - Plaintiff
Construction & Contract Services Pty Ltd - First Defendant
The Institute of Arbitrators and Mediators Australia - Second Defendant

FILE NUMBER(S): SC 4207/07

COUNSEL: Mr J O'Sullivan - Plaintiff
Mr M Lawson - Defendant

SOLICITORS: Wright Pavuk Lawyers - Plaintiff

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

GZELL J

FRIDAY 31 AUGUST 2007

4207/07 BOUTIQUE DEVELOPMENTS LTD v CONSTRUCTION & CONTRACT SERVICES PTY LTD & ANOR

EX TEMPORE JUDGMENT

1 The plaintiff, Boutique Developments Ltd, seeks an injunction restraining the first defendant, Construction & Contract Services Pty Ltd, from taking any step to obtain or enforce any adjudication determination.

2 Boutique Developments also seeks an injunction to restrain the second defendant, The Institute of Arbitrators and Mediators Australia, from taking any step to determine an adjudication application.

3 The application relates to the provision of engineering reports to Boutique Developments in aid of its litigation with CGU Insurance Pty Ltd. The services are the preparation and provision of expert reports. The question is whether the provision of those reports falls within the definition of “construction work” or work undertaken to supply “related goods and services” in respect of both of which services a person is entitled to a progress payment under the Building and Construction Industry Security of Payment Act 1999, s 8(1).

4 The work in question has been described in an affidavit sworn by Simon Maddison Wilson as being limited exclusively to reading, drafting and attendance work that he did at the request of Boutique Developments, the work relating to construction work, in his submission, in that the whole purpose of the work that was conveyed in the documents that were produced by him was to assess the defects in the construction works completed by others and to…

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: [2007] NSWSC 1042
Decision Date: 31 August 2007

CaseChat Overview and Summary

The case of Boutique Developments Ltd v Construction & Contract Services Pty Ltd involved a dispute over whether an expert report prepared for the purpose of pursuing a claim against a third-party insurer for defects in construction work could be considered as either "construction work" or "related goods or services" under the Building and Construction Industry Security of Payment Act 1999. The Federal Court of Australia was tasked with determining the matter.

The central legal issue revolved around the interpretation of the terms "construction work" and "related goods or services" within the Act. Boutique Developments sought an injunction to prevent the adjudication of a payment claim made by Construction & Contract Services. The court had to determine whether the expert reports, which were not directly related to the construction work itself but were preparatory to a claim against an insurer, fell within the statutory definitions and if the jurisdiction of the court should be invoked to decide this question.

The court examined the statutory language and the broader legislative purpose of the Act, which is to facilitate prompt payment in the construction industry. It concluded that the expert reports in question did not constitute "construction work" or "related goods or services" as defined by the Act. Furthermore, the court held that the question of jurisdiction to decide the law entitlement was not one that should be determined by the Court, as it was within the scope of the adjudication process. The injunction application was dismissed, and the court held that the determination of the payment dispute should proceed through the adjudication mechanism established by the Act.

Orders