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Leighton v Arogen

Leighton v Arogen

Case [2012] NSWSC 1323 1 November 2012

Jurisdiction

Natural Justice & Procedural Fairness

Judicial Review

Administrative Law

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Supreme Court

New South Wales

Medium Neutral Citation: Leighton v Arogen [2012] NSWSC 1323
Hearing dates: 08/10/2012, 09/10/2012
Decision date: 01 November 2012
Jurisdiction: Equity Division - Technology and Construction List
Before: McDougall J
Decision:
Determination declared void and quashed. First defendant to pay plaintiff's costs.

Catchwords: [ADMINISTRATIVE LAW] - Building and Construction Industry Security of Payment Act 1999 (NSW) - application to restrain enforcement of, and to quash, a determination of an adjudicator - whether adjudicator materially denied parties natural justice by permitting the defendant to advance its claim in a way the plaintiff was not able to answer - whether adjudicator acted outside jurisdiction - whether adjudicator's determination void - whether adjudicator erred in his approach to the application of s 20(2B) and 22(2)(c) of the Building and Construction Industry Security of Payment Act 1999 (NSW).
Legislation Cited: Building and Construction Industry Security of Payment Act 1999 (NSW)
Cases Cited: Brodyn Pty Ltd v Davenport (2004) 61 NSWLR 421
Downer Construction (Aust) Pty Ltd v Energy Australia (2007) 69 NSWLR 72
John Holland Pty Ltd v Cardno MBK (NSW) Pty Ltd [2004] NSWSC 258
Minister for Commerce v Contrax Plumbing & Ors [2004] NSWSC 823
Pacific General Securities Ltd v Soliman & Sons Pty Ltd (2006) 196 FLR 388
Parkview Constructions Pty Ltd & Anor v Sydney Civil Excavations Pty Ltd [2009] NSWSC 61
Category: Principal judgment
Parties: Leighton Contractors Pty Limited (ACN 000 893 667) (Plaintiff)
Arogen Pty Limited (ACN 110 542 419) (First Defendant)
Philip Davenport (Second Defendant)
Adjudicate Today Pty Limited (ACN 109 605 021) (Third Defendant)
Representation: Counsel:
M G Rudge (SC) / F G Kalyk (Plaintiff)
N A Nicholls / FFF Salama (Defendants)
Solicitors:
Gadens Lawyers (Plaintiff)
Mitry Lawyers (Defendants)

File Number(s): 2012/269835

Judgment

HIS HONOUR: This is yet another application to restrain enforcement of, and to quash, a determination of an adjudicator made under the Building and Construction Industry Security of Payment Act 1999 (NSW) (the Act). In broad terms, the plaintiff (Leighton) claims that the second defendant (the Adjudicator) acted outside the jurisdiction given to him by the Act; and denied it natural justice in some respects.

Factual background

Leighton contracted with Ausgrid to carry out significant upgrading works to the electricity supply system in the southern suburbs of Sydney. The project (as I shall call it) was known as the "Beaconsfield to Kogarah Cable Project". Part of the work required the installation of about 22km of underground electricity supply cables, linking Ausgrid's bulk supply point at Beaconsfield to substations in Marrickville, Canterbury, Rockdale and Kogarah.

On 8 March 2011, Leighton made a contract (the works contract) with the first defendant (Arogen). Under that works contract, Arogen agreed to supply horizontal directional drilling (HDD) services for the project.

On 6 January 2012, Leighton and Arogen made a further agreement (the variation agreement) whereby they varied the works contract in some respects. One effect of the variation agreement was to convert the works contract from a schedule of rates contract to a…

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.

Continue reading Leighton v Arogen

Details

AGLC: Leighton v Arogen [2012] NSWSC 1323
Case: [2012] NSWSC 1323
Decision Date: 01 November 2012

CaseChat Overview and Summary

In the matter of Leighton v Arogen, the dispute arose from an adjudication process under the Building and Construction Industry Security of Payment Act 1999 (NSW). The plaintiff, Leighton, sought to restrain the enforcement of, and to quash, an adjudicator's determination that favoured the defendant, Arogen. The primary contention was that the adjudicator failed to observe principles of natural justice and acted outside the scope of his jurisdiction.

The court was tasked with determining whether the adjudicator's actions amounted to a material denial of natural justice, whether the adjudicator exceeded his jurisdiction, and if the adjudicator erred in his interpretation of sections 20(2B) and 22(2)(c) of the Act. Specifically, the court examined the procedural fairness in the adjudicator's handling of the case, including whether the plaintiff was afforded an adequate opportunity to respond to the defendant's claims.

The court concluded that the adjudicator did not materially deny natural justice, nor did he act beyond his jurisdiction. It found that the adjudicator's determination was valid and that there was no error in his application of the relevant statutory provisions. Consequently, the court dismissed Leighton's application to restrain enforcement of the adjudicator's determination and to quash it. The adjudicator's decision was upheld, and no orders were made to alter the outcome of the adjudication.

Orders