Lords Property Group Pty Ltd v Shire Lind Developments (NSW) Pty Ltd

[2019] NSWSC 1818

Supreme Court

New South Wales

Medium Neutral Citation:	Lords Property Group Pty Ltd v Shire Lind Developments (NSW) Pty Ltd [2019] NSWSC 1818
Hearing dates:	11 December 2019
Decision date:	11 December 2019
Jurisdiction:	Equity - Technology and Construction List
Before:	Ball J
Decision:	(1)   Judgment be entered in favour of the plaintiff in the sum of $1,511,244.06; and  (2)   The defendant pay the plaintiff's costs.
Catchwords:	BUILDING AND CONSTRUCTION – Building and Construction Industry Security of Payment Act 1999 (NSW) – progress payment claims under section 13 of the legislation – recovery of amounts in respect of those payment claims – purported defence based on terms of construction contract – section 16(4)(b) of legislation disentitles defendant to bring defence based on terms of relevant construction contract – no defence to plaintiff’s claim – no issue of principle CIVIL PROCDEDURE – Appearances – multiple applications for adjournments – failure by defendant to appear at final hearing – ample opportunity for defendant to obtain legal representation and advice – defendant made aware of time and place of final hearing – hearing to proceed in absence of defendant
Legislation Cited:	Building and Construction Industry Security of Payment Act 1999 (NSW)
Category:	Principal judgment
Parties:	Lords Property Group Pty Ltd (Plaintiff) Shire Lind Developments (NSW) Pty Ltd (Defendant)
Representation:	Counsel: J Adamopoulos (Plaintiff) No Appearance (Defendant)   Solicitors: Madison Marcus (Plaintiff) No Appearance (Defendant)
File Number(s):	2019/266756

EX TEMPORE Judgment

1. By summons filed on 27 August 2019, the plaintiff seeks to recover progress payments said to be due under a contract dated 20 December 2017 by which the plaintiff undertook to the defendant, a developer, to design and construct two six-storey residential buildings in Sutherland, New South Wales

2. The defendant filed a technology and construction list response on 8 October 2019 , but did not file any evidence. On 15 November 2019, the matter was set down for hearing on 5 December 2019.

3. On 4 December 2019, the defendant advised the Court that no evidence would be filed by the defendant, that the defendant did not require the plaintiff's witnesses for cross-examination, and that the defendant had no defence to the plaintiff's claim.

4. When the matter came on for hearing on 5 December 2019, a director of the defendant appeared with leave of the Court and sought an adjournment on the basis that the defendant had just dismissed its general counsel and wanted an opportunity to attain legal advice and possibly instruct solicitors. An adjournment was granted and the matter was set down for hearing on 11 December 2019. On 10 December 2019 at approximately 7.40pm, a director of the defendant sent an email to my associate saying that the defendant had failed to secure legal representation and requesting an adjournment of the hearing on 11 December 2019. My associate responded to that email by saying that any application for a further adjournment would have to be made in open court at the time of the hearing.

5. The matter was called out of court, but there was no appearance by the defendant at the hearing. In my opinion, the defendant was given sufficient time to obtain legal representation and was on notice of the hearing. In the circumstances, in my opinion, it is appropriate to deal with the matter now.

6. The claim relates to seven progress claims served by the plaintiff on the defendant. Those progress claims were served between 29 March 2018 and 2 October 2018. It is not disputed in the defendant's technology and construction list response that each of those progress claims were “payment claims” within the meaning of s 13 of the Building and Construction Industry Security of Payment Act 1999 (NSW) (the Act). In the case of some of the claims, the defendant made payment although it did so late, and the only claim that is now made by the plaintiff is a claim for interest under s 11(2) of the Act.

7. In the case of the progress claim number 5 dated 29 June 2018, the defendant provided the plaintiff with a payment schedule stating that the amount payable was $833,913.24 rather than the amount of $1,185,075.17 claimed by the plaintiff. The defendant has made a part payment of that amount. In the case of progress claim numbers 6, 7 and 8, the defendant served a payment schedule accepting that the amount claimed by the plaintiff in each case was owing. However, no payments have been made in respect of those progress claims.

8. Under s 16 of the Act, where a claimant has served a payment claim and the respondent has provided a payment schedule in respect of that claim, the claimant may recover the unpaid portion of the scheduled amount from the respondent as a debt due to the claimant in any Court of competent jurisdiction. Section 16(4)(b) of the Act makes it clear that the respondent is not entitled in those proceedings to bring any cross-claim or to raise any defence in relation to matters arising under the relevant construction contract.

9. The only defence that the defendant has raised in its technology and construction list response to the plaintiff's claim based on s 16 is an allegation in each case that the payment claim did not comply with cl 37.1 of the construction contract. That clause relevantly provides that the plaintiff may serve a progress claim if and only if the contractor has satisfied the conditions precedent set out in cl 37.2A of the contract. That clause clearly cannot provide a defence to the right conferred by s 13 of the Act to make a progress claim. As I have said, the defendant concedes that each of the progress claims in this case were payment claims within the meaning of s 13 of the Act. Therefore, the rights conferred by the Act are triggered. Moreover, as I have said, s 16(4)(b)(ii) makes it clear that the defendant cannot in a claim under s 16 raise any defence arising under the construction contract. It follows that the defendant has no defence to the plaintiff's claim.

10. I am satisfied on the evidence before me that the defendant has not made full payment in respect of progress claim number 5 and progress claim numbers 6, 7 and 8. As I have said, the plaintiff is entitled to interest on the progress claims that have been paid.

11. Therefore, the orders of the Court are:

1. Judgment be entered in favour of the plaintiff in the sum of $1,511,244.06; and

2. The defendant pay the plaintiff's costs.

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Decision last updated: 17 December 2019