EQ Constructions Pty Ltd v A-Civil Aust Pty Ltd - [2021] NSWSC 1604

Supreme Court

New South Wales

Medium Neutral Citation: EQ Constructions Pty Ltd v A-Civil Aust Pty Ltd [2021] NSWSC 1604
Hearing dates: 5 October 2021
Date of orders: 10 December 2021
Decision date: 10 December 2021
Jurisdiction: Equity - Technology and Construction List
Before: Williams J
Decision:
Declare that the determination of the second defendant is void for jurisdictional error; order that the sum of $79,317.45 paid into court by the plaintiff be paid out to the plaintiff together with any interest payable thereon; order that the first defendant pay the plaintiff’s costs of the proceedings.

Catchwords:
BUILDING AND CONSTRUCTION – Building and Construction Industry Security of Payment Act 1999 (NSW) (the SOP Act) – second defendant adjudicator determined adjudication application by first defendant sub-contractor in respect of a payment claim served on head contractor – plaintiff head contractor contended that adjudicator’s determination was void for jurisdictional error on several bases, including that the adjudicator had failed to form an opinion that the payment claim had been served within the 12 month time period stipulated in s 13(4)(b) of the SOP Act (or, alternatively, had erred in forming that opinion) – whether s 13(4)(b) of the SOP Act is a “jurisdictional fact” in the first category or second category identified in Icon Co (NSW) Pty Ltd v Australia Avenue Developments Pty Ltd [2018] NSWCA 339 – held that s 13(4)(b) is within the second category – adjudicator did not form an opinion that the payment claim had been served within the period stipulated by s 13(4)(b) – adjudicator’s determination void for jurisdictional error on that basis – not necessary to consider other alleged jurisdictional errors.

Legislation Cited:
Building and Construction Industry Security of Payment Act 1999 (NSW), ss 8, 13, 13(4)(b), 14, 15, 16, 17, 20, 21, 26, 32
Building and Construction Industry Security of Payment Act 2009 (SA), s 12
Buil ding Industry Fairness (Security of Payment) Act 2017 (Qld), s 75

Cases Cited:
Brodyn Pty Ltd v Davenport (2004) 61 NSWLR 421; [2004] NSWCA 394
Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd (2010) 78 NSWLR 393; [2010] NSWCA 190
Clarence Street Pty Ltd v Isis Projects Pty Ltd (2005) 64 NSWLR 248; [2005] NSWCA 391
Clarence Street Pty Ltd v Isis Projects Pty Ltd (2005) 64 NSWLR 448; [2005] NSWCA 391
Coordinated Construction Co Pty Ltd v Climatech (Canberra) Pty Ltd (2005) 21 BCL 364; [2005] NSWCA 229
Estate Property Holdings Pty Ltd v Barclay Mowlem Construction Pty Ltd (2004) 61 NSWLR 515; [2004] NSWCA 393
FitzJersey v Atlas Construction Group [2017] NSWSC 340
Icon Co (NSW) Pty Ltd v Australia Avenue Developments Pty Ltd [2018] NSWCA 339
Joye Group Pty Ltd v Cemco Projects Pty Ltd [2021] NSWCA 211
Maxcon Constructions Pty Ltd v Vadasz (2018) 264 CLR 46; [2018] HCA 5
Maxcon Constructions v Vadasz (No. 2) (2017) 127 SASR 193; [2017] SASCFC 2
Multiplex Constructions Pty Ltd v Luikens [2003] NSWSC 1140
Pacific General Securities…

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: [2021] NSWSC 1604
Decision Date: 10 December 2021

CaseChat Overview and Summary

EQ Constructions Pty Ltd brought an action against A-Civil Aust Pty Ltd, challenging a determination made by an adjudicator under the Building and Construction Industry Security of Payment Act 1999 (NSW) (the SOP Act). The dispute centred on an adjudication application filed by a sub-contractor, which the adjudicator assessed and ruled on. EQ Constructions, as the head contractor, contended that the adjudicator's determination was flawed and void due to a jurisdictional error. Specifically, EQ Constructions argued that the adjudicator failed to form a requisite opinion that the payment claim had been served within the statutory time frame outlined in s 13(4)(b) of the SOP Act. This was one of several bases on which EQ Constructions sought to invalidate the adjudicator's decision.

The primary legal issue before the court was whether section 13(4)(b) of the SOP Act constituted a "jurisdictional fact" and, if so, whether it belonged to the first category or the second category as identified in the case of Icon Co (NSW) Pty Ltd v Australia Avenue Developments Pty Ltd [2018] NSWCA 339. The court had to determine the nature of the jurisdictional fact and the implications of the adjudicator's failure to address it. This involved examining whether the adjudicator's omission rendered the entire determination void and, if so, whether any other alleged errors needed to be considered.

In its reasoning, the court held that section 13(4)(b) of the SOP Act falls within the second category of jurisdictional facts, similar to those in Icon Co (NSW) Pty Ltd v Australia Avenue Developments Pty Ltd. This meant that the adjudicator's failure to form an opinion on the timeliness of the payment claim was a critical error. As the adjudicator did not address the timeline requirement, the court concluded that the determination was void for this jurisdictional error. Consequently, the court found it unnecessary to delve into the other alleged errors raised by EQ Constructions. The adjudicator's failure to consider the jurisdictional fact was sufficient to invalidate the entire decision.

The final orders were made in favour of EQ Constructions, declaring the adjudicator's determination void due to the jurisdictional error identified. The court did not need to address any other grounds for invalidating the determination. This ruling underscores the importance of adjudicators strictly adhering to statutory requirements, especially when considering the timeliness of payment claims under the SOP Act.

Orders