Easy Stay Mining Accommodation Pty Ltd v Faigen - [2017] WASC 266

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: EASY STAY MINING ACCOMMODATION PTY LTD -v- FAIGEN [2017] WASC 266

CORAM: ALLANSON J

HEARD: 25 AUGUST 2017

DELIVERED : 30 AUGUST 2017

FILE NO/S: CIV 2271 of 2017

BETWEEN: EASY STAY MINING ACCOMMODATION PTY LTD
Applicant
AND
PHILLIP DAVID FAIGEN
Respondent
GROUNDED CONSTRUCTION GROUP PTY LTD
Other Party

Catchwords:

Practice and procedure - Injunction to restrain enforcement of adjudicator's determination - Where determination taken to be judgment of court - Arguable case - Balance of convenience - Turns on own facts

Legislation:

Civil Judgments Enforcement Act 2004 (WA), s 15, pt 4 div 5
Construction Contracts Act 2004 (WA), s 3, s 30, s 31(2), s 43, s 46, sch 1 div 4
Construction Contracts Amendment Act 2016 (WA)

Result:

Application for interlocutory relief refused

Category: B

Representation:

Counsel:

Applicant:     Mr P G Clifford
Respondent:     No appearance
Other Party  :     Mr S Brown & Mr J J Leslie

Solicitors:

Applicant:     Doyles Construction Lawyers
Respondent:     No appearance
Other Party  :     Lateral Legal

Case(s) referred to in judgment(s):

BGC Construction Pty Ltd v Citygate Properties Pty Ltd [2016] WASC 88
CSR Ltd v Cigna Insurance Australia Ltd [1997] HCA 33; (1997) 189 CLR 345
Diploma Construction (WA) Pty Ltd v KPA Architects Pty Ltd [2014] WASCA 91
Eastland Technology Australia Pty Ltd v Whisson [2003] WASCA 307; (2003) 28 WAR 308
Ladang Jalong (Australia) Pty Ltd v Callander [2005] WASCA 203
Laing O'Rourke Australia Construction Pty Ltd v Samsung C&T Corporation [2015] WASC 237
Laing O'Rourke Australia Construction Pty Ltd v Samsung C&T Corporation [2016] WASCA 130
Perrinepod Pty Ltd v Georgiou Building Pty Ltd [2011] WASCA 217; (2011) 43 WAR 319
West Boat Builders Pty Ltd v Cull Holdings Pty Ltd [1999] WASCA 72
Wingfoot Australia Partners Pty Ltd v Kocak [2013] HCA 43; (2013) 252 CLR 480

ALLANSON J: On 31 July 2017, Easy Stay Mining Accommodation Pty Ltd brought an application for judicial review of four determinations made by Phillip David Faigen, an adjudicator under the Construction Contracts Act 2004 (WA). Grounded Construction Group Pty Ltd was the successful party in the adjudication and is named as the other party to the application for judicial review.
Easy Stay seeks relief by a writ of certiorari, a declaration of invalidity, and an injunction restraining Grounded Construction from enforcing the determinations.
The application is brought on six grounds, although there are multiple complaints within several of the grounds. The grounds are carelessly drafted and require some interpretation or explanation to yield their meaning:
The Respondent erred in his determination as;
1.There was no construction contract pursuant to the Construction Contract Act 2004 in that;
a.The parties had not agreed rates or quantities, or
b.That it was a cost‑plus contract, and
c.Has provided no 'reasons' or made any findings of fact sufficient to support a conclusion that there is a 'cost plus' contract.
2.The claim was invalid under the Construction Contract Act 2004 as it was

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: [2017] WASC 266
Decision Date: 30 AUGUST 2017

CaseChat Overview and Summary

In the case of Easy Stay Mining Accommodation Pty Ltd v Faigen, the dispute before the court involved a request for an injunction to restrain the enforcement of an adjudicator's determination, which had been taken to be a judgment of the court. The case was heard by the Supreme Court of Western Australia, with Justice Beech acting as the presiding judge. Easy Stay Mining Accommodation Pty Ltd sought to challenge the validity of the adjudicator's determinations, arguing that they were made in the absence of a construction contract between Easy Stay and Grounded Construction. The central issue for the court to decide was whether the adjudicator's determinations were susceptible to challenge on the basis that there was no construction contract between the parties, and whether the adjudicator was required to determine the merits of the payment dispute by reference to the construction contract that was before him.

The court considered the arguments presented by Easy Stay, which included the submission that the adjudicator's determinations were a failure to find the express terms of the contract regarding agreements as to rates and prices, and that the reasons provided by the adjudicator did not demonstrate a rational approach and reasonably explain the basis for the determination. The court acknowledged that the case advanced by Easy Stay was arguable, as the adjudicator was required to make specific findings of fact about what the contract was, and its terms, and to analyse the reasonableness of the claim as to rates, times and amounts against those terms. However, the court found that it was unnecessary to consider the submission further, as the error identified by Ipp J in West Boat Builders Pty Ltd v Cull Holdings Pty Ltd [1999] WASCA 72 [7] would be unlikely to be found to be jurisdictional error in the context of the Construction Contracts Act.

The court noted that it would be preferable for the grounds of the application to be redrafted to more clearly identify the alleged errors as errors going to jurisdiction, and to avoid the apparent overlap that permitted counsel to submit that his submission at one point was as to grounds 1, 2, 3 and 4. The court also noted that it was not argued in the interlocutory application, but the parties would need to consider the implications of the determinations being filed in the District Court. In particular, Easy Stay seeks a writ of certiorari, which is available only in respect of an exercise or purported exercise of power which has, at the date of order, an 'apparent legal effect': Wingfoot Australia Partners Pty Ltd v Kocak [2013] HCA 43; (2013) 252 CLR 480 [25]. The determinations were now taken to be orders of the District Court, and the court would be assisted by submissions on whether the determination of the adjudicator now has legal effect and is susceptible to being called up and quashed.

The court ultimately decided that the application for an injunction was dismissed, but allowed Easy Stay to amend its grounds of application to more clearly identify the alleged errors as errors going to jurisdiction. The court also noted that the parties would need to consider the implications of the determinations being filed in the District Court, and whether the determination of the adjudicator now has legal effect and is susceptible to being called up and quashed. The court did not make any further orders in relation to the dispute, but indicated that the matter would need to be reconsidered in light of the court's decision.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

Easy Stay's primary submission is that the determinations are susceptible to challenge on the ground that there was no construction contract between Easy Stay and Grounded Construction. It couples that submission with the related argument that the adjudicator was required to determine the merits of the payment dispute by reference to the construction contract that was before him: see Laing O'Rourke Australia Construction Pty Ltd v Samsung C&T Corporation [2015] WASC 237 [219]. Easy Stay thus submitted:[A] jurisdictional error in each of the adjudication applications in this case is a failure to find the express terms of the contract regarding agreements as to rates and prices; and a complete absence in the Adjudicator's reasons grappling with the application of those rates to the reasonableness of the work done, the rates and the invoices themselves. Easy Stay also submitted, from the obligation of the adjudicator to give reasons, that it was jurisdictional error if the reasons did not demonstrate a rational approach and reasonably explain the basis for the determination: citing BGC Construction Pty Ltd v Citygate Properties Pty Ltd [2016] WASC 88. As I understood the submission, counsel said that Easy Stay was not challenging the adequacy of the reasons. But where Easy Stay had put in issue whether there was a contract, any payment claim must identify the term of the contract under which the claim is made, and put on evidence sufficient to support its claim that the amount of money claimed is as a result of the work having been done in a reasonable time and for a reasonable amount. The reasons of the adjudicator must identify the terms of the contract on which he relied to justify the payment claimed. In the context of this contract, it was submitted, the adjudicator was required to make specific findings of fact about what the contract was, and its terms, and to analyse the reasonableness of the claim as to rates, times and amounts against those terms. Easy Stay also relied in its written submissions on statements by Ipp J in West Boat Builders Pty Ltd v Cull Holdings Pty Ltd [1999] WASCA 72 [7]. The passage relied on is concerned with the adequacy of the invoices in that case to prove the reasonableness of the amounts charged by Cull Holdings for the work it carried out. In my opinion, the error identified by Ipp J in that case would be unlikely to be found to be jurisdictional error in the context of the Construction Contracts Act. But it is unnecessary for me to consider the submission further. The case advanced by Easy Stay is arguable. If the matter is to proceed, it would be preferable for the grounds of the application to be redrafted to more clearly identify the alleged errors as errors going to jurisdiction and perhaps avoid the apparent overlap that permitted counsel to submit that his submission at one point was as to grounds 1, 2, 3 and 4. It was not argued in the interlocutory application, but the parties will need to consider the implications of the determinations being filed in the District Court. In particular, Easy Stay seeks a writ of certiorari. That writ is available only in respect of an exercise or purported exercise of power which has, at the date of order, an 'apparent legal effect': Wingfoot Australia Partners Pty Ltd v Kocak [2013] HCA 43; (2013) 252 CLR 480 [25]. The determinations are now taken to be orders of the District Court. I would be assisted by submissions on whether the determination of the adjudicator now has legal effect and is susceptible to being called up and quashed.