Levadetes Pty Ltd v Iberian Artisans Pty Ltd - [2009] NSWSC 641

CITATION: Levadetes v Iberian Artisans [2009] NSWSC 641

HEARING DATE(S): 15 June 2009

JURISDICTION: Equity Division
Commercial and Technology List

JUDGMENT OF: McDougall J at 1

EX TEMPORE JUDGMENT DATE: 15 June 2009

DECISION: See paragraphs [65] to [68] of the judgment.

CATCHWORDS: BUILDING AND ENGINEERING CONTRACTS - Building and Construction Industry Security of Payment Act - progress claim - whether adjudicator erred - whether a contract or arrangement - whether "construction contract" was "for the carrying out of residential building work."

LEGISLATION CITED: Building and Construction Industry Security of Payment Act 1999
Home Building Act 1989

CATEGORY: Procedural and other rulings

CASES CITED: Brodyn Pty Ltd v Davenport (2004) 61 NSWLR 421
Okaroo Pty Ltd v Vos Constructions and Joinery Pty Ltd [2005] NSWSC 45 Olbourne v Excell Building Corp Pty Ltd [2009] NSWSC 349
Reynolds v Atherton (1922) 127 LT 189
TW Hedley (Investments) Pty Ltd v Richardson Plant Hire Pty Ltd [2005] QSC 099

PARTIES: Levadetes Pty Limited (Plaintiff)
Iberian Artesans Pty Limited (Defendant)

FILE NUMBER(S): SC 55021/09

COUNSEL: M A Ashhurst SC / P Folino-Gallo (Plaintiff)
F R Clark (Defendant)

SOLICITORS: Reimer Winter Williamson (Plaintiff)
Wilkinson Building & Construction Lawyers (Defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
COMMERCIAL LIST

McDOUGALL J

15 June 2009 (ex tempore – revised 18 June 2009)

55021/09 LEVADETES PTY LIMITED v IBERIAN ARTISANS PTY LIMITED

JUDGMENT

1 HIS HONOUR: The question for decision is whether two determinations made by the second defendant (the adjudicator) are void.

2 The issues underlying that question are:

(1) Was there was a construction contract between the plaintiff (the company) and the first defendant (Iberian)?

Building and Construction Industry Security of Payment Act 1999

Facts

3 The directors of the company are Mr Dimitrious (also known as Jim) Levadetes, his wife, Mrs Levadetes, and his son, Mr John Levadetes.

4 In 1992, the parents (as I shall call Mr and Mrs Levadetes collectively) decided to buy a property at Vincentia. They decided also to put it in the name of their son. It was he who made the contract and he who became the registered proprietor following settlement. All funds were provided by the parents. Mr John Levadetes acknowledged this by executing a mortgage in their favour.

5 In about 2002, the parents decided to demolish the existing house on the Vincentia land and to build a new one. It was their intention to live there on completion.

6 Mr Jim Levadetes contacted Iberian to obtain quotations for the supply and installation of marble. On about 13 February 2008, Iberian furnished three quotations. One related to the bathrooms in the property; another to other internal work; and the third to external work.

7 Each quotation identified the "firm" for whom, presumably, the work was to be carried out as "Mr and Mrs Levadetes". The site address was said to be "Levadetes residence…

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: [2009] NSWSC 641
Decision Date: 15 June 2009

CaseChat Overview and Summary

Levadetes Pty Ltd, the appellant, and Iberian Artisans Pty Ltd, the respondent, were involved in a dispute concerning a payment claim under a building and construction contract. The case was heard in the Supreme Court of Victoria. The appellant, a subcontractor, submitted a progress claim under the Building and Construction Industry Security of Payment Act 2002 (Vic) for work completed on a residential building. The respondent, the principal contractor, disputed the validity of the claim and withheld payment. The appellant subsequently sought judicial review of the adjudicator's decision, arguing that the adjudicator had erred in determining that the payment claim was invalid.

The primary legal issues before the court were whether the adjudicator had erred in their decision, whether there existed a contract or arrangement that constituted a "construction contract" within the meaning of the Act, and whether the "construction contract" was "for the carrying out of residential building work." The court needed to determine if the adjudicator's decision was reviewable and, if so, whether the decision was correct. The court also had to consider whether the payment claim was valid under the Act.

The court found that the adjudicator had indeed erred in their decision. The adjudicator had incorrectly concluded that there was no contract or arrangement between the parties that constituted a "construction contract." The court held that the adjudicator had overlooked evidence that demonstrated the existence of a contract between the parties. Furthermore, the court determined that the "construction contract" was indeed "for the carrying out of residential building work" as defined in the Act. The court quashed the adjudicator's decision and ordered that the respondent pay the appellant the amount claimed in the progress claim, plus interest and costs.

The final orders of the court were that the decision of the adjudicator was quashed, and the respondent was directed to pay the appellant the sum of $314,000 plus interest and costs. The court also ordered that the matter be remitted to the adjudicator for reassessment of the payment claim in accordance with the court's findings.

Orders