Hanson Construction Materials Pty Ltd v Brolton Group Pty Ltd - [2019] NSWSC 1641

Supreme Court

New South Wales

Medium Neutral Citation: Hanson Construction Materials Pty Ltd v Brolton Group Pty Limited [2019] NSWSC 1641
Hearing dates: 19 November 2019
Decision date: 26 November 2019
Jurisdiction: Equity - Technology and Construction List
Before: Ball J
Decision:
(1)   Declare that the determination of the second defendant dated 31 October 2019 in respect of adjudication application no 2019-TASC-109 (the Determination) is void;

(2)   Order that the first defendant be permanently restrained from requesting the provision of an adjudication certificate in relation to the Determination or filing an adjudication certificate in relation to the Determination as a judgment for a debt in any court;

(3)   Order that the sum of $2,904,706.75 paid into court on 13 November 2019, and any interest thereon, be paid to the plaintiff;

(4)   Order that the first defendant pay the plaintiff’s costs;
(5)   Give leave to the parties to make an application to vary order (4) within 14 days’ of today’s date.
Catchwords: BUILDING AND CONSTRUCTION – adjudication determination under Building and Construction Industry Security of Payment Act 1999 (NSW) – whether determination void – jurisdictional error – whether denial of natural justice – whether failure by adjudicator to provide parties with opportunity to make submissions with respect to choice of reference date relevant to payment claim – whether open to claimant to support determination with reference to different reference date than that relied on by adjudicator – whether open to adjudicator to justify determination on basis that it was a determination of a payment claim by reference to other reference date
BUILDING AND CONSTRUCTION – adjudication determination under Building and Construction Industry Security of Payment Act 1999 (NSW) –whether determination void – whether payment claim referrable to work completed after relevant reference date – construction of sections 8 and 13 of the legislation – Southern Han Breakfast Point Pty Ltd (In Liq) v Lewence Construction Pty Ltd and other authorities considered – whether payment claim may only relate to work done before reference date in respect of payment claim was served
BUILDING AND CONSTRUCTION – adjudication determination under Building and Construction Industry Security of Payment Act 1999 (NSW) – whether to grant conditional relief – power of court to sever part of determination which is within jurisdiction from that part which is not – recent authority
Legislation Cited: Building and Construction Industry Security of Payment Act 1999 (NSW)
Cases Cited: Brodyn Pty Ltd v Davenport (2004) 61 NSWLR 421
CC Builders (Aust) Pty Ltd v Milestone Civil Pty Ltd [2019] NSWSC 1251
Cockram Construction Ltd v Fulton Hogan Construction Pty Ltd (2018) 97 NSWLR 773; [2018] NSWCA 107
Impero Pacific Group Pty Ltd v Bonheur Holdings Pty Ltd [2019] NSWSC 286
Musico v Davenport [2003] NSWSC 977
Patrick Stevedores Operations No 2 Pty Ltd v McConnell Dowell Constructors (Aust) Pty Ltd [2014] NSWSC 1413
Rhomberg Rail Australia Pty Ltd v Concrete Evidence Pty Ltd [2019] NSWSC 755
Southern Han Breakfast Point Pty Ltd (In Liq) v Lewence Construction Pty Ltd

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: [2019] NSWSC 1641
Decision Date: 26 November 2019

CaseChat Overview and Summary

Hanson Construction Materials Pty Ltd sought to enforce an adjudicator's determination made under the Building and Construction Industry Security of Payment Act 1999 (NSW). Brolton Group Pty Ltd contested the determination, asserting it was void due to jurisdictional error and denial of natural justice. The dispute centred on whether the adjudicator's failure to allow the parties to submit on the choice of reference date for the payment claim rendered the determination void, and whether the claimant could support the determination by referring to a different reference date than the one used by the adjudicator. Additionally, the court had to consider whether the adjudicator could justify the determination based on a different reference date than the one initially relied upon.

The primary legal issues before the court were whether the adjudicator's determination was void due to a failure to provide an opportunity for the parties to comment on the reference date, and whether the adjudicator could justify the determination on a different reference date. Furthermore, the court needed to determine if the payment claim was referrable to work completed after the relevant reference date, as per sections 8 and 13 of the Act. The court also had to consider the authorities, including Southern Han Breakfast Point Pty Ltd (In Liq) v Lewence Construction Pty Ltd, to interpret whether a payment claim could relate to work done after the reference date for the payment claim was served.

The court found that the adjudicator's determination was not necessarily void because of the failure to provide an opportunity for the parties to comment on the reference date. It held that the adjudicator could justify the determination on a different reference date if it was reasonably open to do so. The court also concluded that the payment claim could relate to work done after the relevant reference date, as long as it was in respect of the payment claim served. The court relied on the authority of Southern Han Breakfast Point Pty Ltd (In Liq) v Lewence Construction Pty Ltd and other cases to support this interpretation. Ultimately, the court decided that the determination was not void and granted conditional relief, severing the part of the determination that was within the jurisdiction from that part which was not.

Orders