Denis McFadden v Daniel John Turnbull - [2011] NSWSC 1294

Supreme Court

New South Wales

Medium Neutral Citation: Denis McFadden & Anor v Daniel John Turnbull & Anor [2011] NSWSC 1294
Hearing dates: Wednesday, 26 October 2011
Decision date: 26 October 2011
Jurisdiction: Equity Division - Commercial List
Before: Brereton J
Decision:
Adjudication declared void.

Catchwords: BUILDING AND ENGINEERING CONTRACTS - Defendant obtains adjudication determining moneys owed pursuant to building contract - corporation and natural person promisees under building contract - corporation alone is owner of land - whether contract one for the carrying out of residential building work on premises for party whom resides in or proposes to reside in, for purposes of (NSW) Building and Construction Industry Security of Payments Act, 1999, s 7(2)(b) - construction of s 7(2)(b) - sufficient for one party to contract to reside or intend to reside in premises - contract falls within s 7(2)(b) and is not a contract to which Act applies - adjudication void.
Legislation Cited: (NSW) Building and Construction Industry Security of Payment Act, 1999, s 4, s 7, s 15
Cases Cited: Advance Earthmovers Pty Ltd v Fubew Pty Ltd [2009] NSWCA 337
Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd (2010) 272 ALR 750; [2010] NSWCA 190
Kirk v Industrial Relations Commission of New South Wales (2010) 239 CLR 531
Levadetes v Iberian Artisans [2009] NSW SC 641
Category: Principal judgment
Parties: Denis McFadden (first plaintiff)
Hickory Hill Pty Ltd (second plaintiff)
Daniel John Turnbull (first defendant)
Philip Martin (second defendant)
Representation: Counsel:
Dr A Greinke (plaintiffs)
Mr B De Buse (first defendant)
Solicitors:
Turnbull Bowles Lawyers (plaintiffs)
Mills Oakley Lawyers (first defendant)

File Number(s): 2011/202283

Judgment (ex tempore)

HIS HONOUR: The second plaintiff Hickory Hill Pty Ltd ('Hickory Hill') is the registered proprietor of Lot XX in Deposited Plan 554106 known as Hickory Hill at Tuggalong Road, Canyonleigh in the State of New South Wales. Hickory Hill is the trustee of a family trust associated with the first plaintiff Denis McFadden, who at relevant times has resided in a farmhouse on the property, although he also occupies premises in Sydney during the week. On 1 July 2009, Mr McFadden and Hickory Hill as trustee of the McFadden Family Trust entered into a building contract with the first defendant Daniel John Turnbull, for the construction of a new home on the Hickory Hill property. As a result of an application under (NSW) Building and Construction Industry Security of Payment Act , 1999, made by Mr Turnbull, the second defendant, an adjudicator under that Act, issued on 14 June 2011 an adjudication determining that an amount of $211,824, inclusive of GST, was payable by Hickory Hill to Mr Turnbull. Subsequently, an adjudication certificate was registered in the District Court at Wollongong in proceedings 2011/209835, the consequence of which is that there is a judgment of that Court that Hickory Hill pay Mr Turnbull the sum of $222,619.35. Pending the hearing of the present proceedings, the enforcement of that judgment has been "stayed" by an interlocutory…

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: [2011] NSWSC 1294
Decision Date: 26 October 2011

CaseChat Overview and Summary

In the matter of Denis McFadden v Daniel John Turnbull, the dispute revolves around a building contract and the determination of moneys owed under it. The case was heard in the Supreme Court of New South Wales. The defendant, Daniel John Turnbull, had obtained an adjudication determining the sum of moneys owed to him under the contract, which was between himself and Denis McFadden. The contract involved the promise of payment by both a corporation and a natural person. However, only the corporation was the owner of the land in question.

The legal issue before the court was whether the contract in question was a contract for the carrying out of residential building work on premises for a party who resides, or proposes to reside, in the premises, within the meaning of section 7(2)(b) of the New South Wales Building and Construction Industry Security of Payments Act 1999. This determination was crucial in deciding whether the Act applied to the contract. The court needed to interpret section 7(2)(b) and ascertain whether it was sufficient for one party to the contract to reside or intend to reside in the premises for the contract to fall within the section.

The court held that section 7(2)(b) of the Act required that a contract be one for the carrying out of residential building work on premises for a party who resides, or proposes to reside, in the premises. It was sufficient for one party to the contract to reside or intend to reside in the premises. In this case, the contract fell within the scope of section 7(2)(b) and was not a contract to which the Act applied. Consequently, the adjudication obtained by the defendant was void. The court's reasoning was based on a careful interpretation of the statutory language and its application to the facts of the case.

Orders