Civmec Construction and Engineering Pty Ltd v Sandvik Mining and Construction Australia Pty Ltd
[2020] WASC 168
•19 MAY 2020
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: CIVMEC CONSTRUCTION & ENGINEERING PTY LTD -v- SANDVIK MINING AND CONSTRUCTION AUSTRALIA PTY LTD [2020] WASC 168
CORAM: ARCHER J
HEARD: ON THE PAPERS
DELIVERED : 19 MAY 2020
FILE NO/S: CCD 2 of 2019
BETWEEN: CIVMEC CONSTRUCTION & ENGINEERING PTY LTD
Judgment Creditor
AND
SANDVIK MINING AND CONSTRUCTION AUSTRALIA PTY LTD
Judgment Debtor
Catchwords:
Costs - Enforcement proceedings - Turns on its own facts
Legislation:
Nil
Result:
The Judgment Debtor is to pay the costs of the Judgment Creditor to be taxed if not agreed
Category: B
Representation:
Counsel:
| Judgment Creditor | : | No appearance (on the papers) |
| Judgment Debtor | : | No appearance (on the papers) |
Solicitors:
| Judgment Creditor | : | Tottle Partners |
| Judgment Debtor | : | Squire Patton Boggs |
Case(s) referred to in decision(s):
Diploma Construction (WA) Pty Ltd v KPA Architects Pty Ltd [2014] WASCA 91
Sandvik Mining and Construction Australia Pty Ltd v Fisher [2019] WASC 352
Sandvik Mining and Construction Australia Pty Ltd v Fisher [No 2] [2020] WASC 123
ARCHER J:
Introduction
The issue
These proceedings were brought by Civmec Construction & Engineering Pty Ltd (Civmec) against Sandvik Mining and Construction Australia Pty Ltd (Sandvik). Civmec sought a means inquiry in relation to Sandvik's ability to pay a debt arising from the determination of an adjudicator under s 31(2)(b) of the Construction Contracts Act 2004 (WA) (Act).
The proceedings are to be dismissed. The parties disagree as to the appropriate costs order to be made. They have asked that I determine the issue on the papers.
History
On 6 May 2019, an adjudicator determined, under s 31(2)(b) of the Act, that Sandvik was required to pay $1,664,650.29 (determined amount) to Civmec. The adjudicator directed that the determined amount be paid by 13 May 2019.
Sandvik refused to pay the determined amount. Sandvik instead offered to pay it into court or provide some other form of security. Civmec rejected this offer.
In May 2019, Civmec commenced these proceedings by making an application for a means inquiry under s 26 and s 27 of the Civil Judgments Enforcement Act 2004 (WA). This was a necessary step before a time for payment order, an instalment order or an earnings appropriation order could be made.[1]
[1] Section 21 of the Civil Judgments Enforcement Act 2004.
In the meantime, Sandvik had made an application for judicial review of the adjudicator's determination, seeking that it be set aside.
On 12 June 2019, after some further exchanges between the parties, Sandvik applied for an injunction to restrain Civmec from enforcing the determination. Civmec then consented to the means enquiry being adjourned pending the determination of Sandvik's application for an injunction.
On 16 September 2019, I dismissed Sandvik's application for an injunction.[2] Three days later, Sandvik paid the determined amount to Civmec.
[2] Sandvik Mining and Construction Australia Pty Ltd v Fisher [2019] WASC 352.
On 16 April 2020, I published my decision dismissing Sandvik's application to set aside the adjudicator's determination.[3] I also ordered that Sandvik pay Civmec's costs.
[3] Sandvik Mining and Construction Australia Pty Ltd v Fisher [No 2] [2020] WASC 123.
Civmec asks that the same orders be made in these proceedings. Sandvik does not oppose the dismissal of the proceedings. However, it submits that there should be no orders as to costs.
Analysis
Sandvik submits there should be no order as to costs because Civmec's conduct, in bringing these proceedings, resulted in costs being unnecessarily or unreasonably incurred. Sandvik submits that it was not necessary for Civmec to commence these proceedings because 'Sandvik had offered to pay the full amount of [the determined amount] into Court or to secure payment of that sum, the means inquiry was adjourned and not pursued, and the full amount was paid shortly after the injunction application was dismissed'.[4] Sandvik submits the application for a means inquiry was premature.
[4] Judgment Debtor's Submissions as to Costs filed 13 May 2020 [13].
I do not accept that the commencing of these proceedings caused costs to be unnecessarily or unreasonably incurred. In my view, it was reasonable for Civmec to commence these proceedings, and to do so when it did.
The date upon which the determined amount was required to be paid had passed. Sandvik had refused to pay. It is true that Sandvik had offered to pay the determined amount into court. This, however, would not have given Civmec the immediate benefit of the determined amount, which it was entitled to have under the determination.
One of the main purposes of the Act is to keep the money flowing in construction contract disputes, on a pay now, argue later basis.[5] In my view, it would be a rare case in which a contractor's refusal to accept something less than its entitlement could be characterised as unreasonable. Perhaps it would be unreasonable where the adjudicator's determination patently involved jurisdictional error. This is not such a case. Indeed, Sandvik ultimately failed to demonstrate, at least to a first instance judge, that it involved jurisdictional error.
[5] Diploma Construction (WA) Pty Ltd v KPA Architects Pty Ltd [2014] WASCA 91 [55].
It was not unreasonable for Civmec to refuse to accept something less than its entitlement. It was not unreasonable for Civmec to commence these proceedings to enforce its entitlement.
Further, Civmec commenced these proceedings before Sandvik had sought an injunction. Once the injunction application was made, Civmec agreed to the adjournment of the means inquiry. This meant that no unnecessary costs were incurred.
Once Sandvik lost the injunction application, it paid the determined amount. This meant the means inquiry was no longer required.
In my view, Civmec's conduct did not cause costs to be unnecessarily or unreasonably incurred.
Accordingly, Sandvik should pay Civmec's costs of these proceedings, to be taxed if not agreed.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
SW
Associate to the Honourable Justice Archer19 MAY 2020
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