Marine and Civil Pty Ltd and WQube Port Of Dampier Pty Ltd
[2014] WASAT 167
•10 DECEMBER 2014
MARINE & CIVIL PTY LTD and WQUBE PORT OF DAMPIER PTY LTD [2014] WASAT 167
| STATE ADMINISTRATIVE TRIBUNAL | Citation No: | [2014] WASAT 167 | |
| CONSTRUCTION CONTRACTS ACT 2004 (WA) | |||
| Case No: | CC:1029/2014 | 27 NOVEMBER 2014 | |
| Coram: | MR T CAREY (MEMBER) | 10/12/14 | |
| 25 | Judgment Part: | 1 of 1 | |
| Result: | Application unsuccessful | ||
| B | |||
| PDF Version |
| Parties: | MARINE & CIVIL PTY LTD WQUBE PORT OF DAMPIER PTY LTD |
Catchwords: | Review of dismissal of adjudication application under Construction Contracts Act 2004 (WA) Dismissal for not being prepared in accordance with the legislation Contact detail of appointor omitted Whether contact detail 'known' at relevant time Adjudicator's ability to call for further submissions Whether applicant entitled to adduce further evidence |
Legislation: | Construction Contracts Act 2004 (WA), s 3, s 4, s 6, s 26, s 27, s 28, s 30, s 31, s 32, s 46, Pt 3 State Administrative Tribunal Act 2004 (WA), s 27, s 27(1), s 27(2), s 29 Construction Contracts Regulations 2004 (WA), reg 4, reg 5 |
Case References: | Marine & Civil Bauer Joint Venture and Leighton Kumagai Joint Venture [2005] WASAT 269 Match Projects Pty Ltd and Arccon (WA) Pty Ltd [2009] WASAT 134 MRCN Pty Ltd t/as Westforce Constructions and ABB Australia Pty Ltd [2014] WASAT 59 Perrinepod Pty Ltd v Georgiou Building Pty Ltd [2011] WASCA 217 WQube Port of Dampier v Philip Loots of Kahlia Nominees Ltd [2014] WASC 331 |
Orders | On the application heard before Member Tim Carey it is on 10 December 2014, ordered that:,1. The review application is dismissed.,2. The decision under review is affirmed. |
Summary | The applicant sought review of a decision of an adjudicator under the Construction Contracts Act 2004 (WA) to dismiss its application for adjudication of a payment dispute under the Construction Contracts Act 2004. The adjudicator's decision was made on the ground that the application had not been prepared in accordance with the Construction Contracts Act 2004; specifically, it had not contained the Australian Business Number of the appointor of adjudication, as required by regulation.,The applicant contended that it was not required to provide the appointor's Australian Business Number because the regulation required provision of that detail only where known by the person required to give it and the applicant did not know that detail. The adjudicator found knowledge of the contact detail to have been present. ,The Tribunal considered the procedure undertaken by the adjudicator in calling for submissions about the contact detail issue subsequent to the adjudication application and response of the respondent. It found that procedure to be within the adjudicator's powers under the Construction Contracts Act 2004. It also rejected a request by the applicant, in the event of such a finding, that the applicant be permitted to rely on fresh evidence not before the adjudicator.,The Tribunal, having regard to the material before the adjudicator, and, in particular, evidence concerning three other adjudications between the same parties shortly preceding the application the subject of the review involving the same project and the same appointor, concluded that the applicant did know the relevant contact detail. It accordingly dismissed the review application and affirmed the adjudicator's decision. |
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL ACT : CONSTRUCTION CONTRACTS ACT 2004 (WA) CITATION : MARINE & CIVIL PTY LTD and WQUBE PORT OF DAMPIER PTY LTD [2014] WASAT 167 MEMBER : MR T CAREY (MEMBER) HEARD : 27 NOVEMBER 2014 DELIVERED : 10 DECEMBER 2014 FILE NO/S : CC 1029 of 2014 BETWEEN : MARINE & CIVIL PTY LTD
- Applicant
AND
WQUBE PORT OF DAMPIER PTY LTD
Respondent
Catchwords:
Review of dismissal of adjudication application under Construction Contracts Act 2004 (WA) Dismissal for not being prepared in accordance with the legislation Contact detail of appointor omitted Whether contact detail 'known' at relevant time Adjudicator's ability to call for further submissions Whether applicant entitled to adduce further evidence
Legislation:
Construction Contracts Act 2004 (WA), s 3, s 4, s 6, s 26, s 27, s 28, s 30, s 31, s 32, s 46, Pt 3
State Administrative Tribunal Act 2004 (WA), s 27, s 27(1), s 27(2), s 29
Construction Contracts Regulations 2004 (WA), reg 4, reg 5
Result:
Application unsuccessful
Summary of Tribunal's decision:
The applicant sought review of a decision of an adjudicator under the Construction Contracts Act 2004 (WA) to dismiss its application for adjudication of a payment dispute under the Construction ContractsAct 2004. The adjudicator's decision was made on the ground that the application had not been prepared in accordance with the Construction Contracts Act 2004; specifically, it had not contained the Australian Business Number of the appointor of adjudication, as required by regulation.
The applicant contended that it was not required to provide the appointor's Australian Business Number because the regulation required provision of that detail only where known by the person required to give it and the applicant did not know that detail. The adjudicator found knowledge of the contact detail to have been present.
The Tribunal considered the procedure undertaken by the adjudicator in calling for submissions about the contact detail issue subsequent to the adjudication application and response of the respondent. It found that procedure to be within the adjudicator's powers under the Construction Contracts Act 2004. It also rejected a request by the applicant, in the event of such a finding, that the applicant be permitted to rely on fresh evidence not before the adjudicator.
The Tribunal, having regard to the material before the adjudicator, and, in particular, evidence concerning three other adjudications between the same parties shortly preceding the application the subject of the review involving the same project and the same appointor, concluded that the applicant did know the relevant contact detail. It accordingly dismissed the review application and affirmed the adjudicator's decision.
Category: B
Representation:
Counsel:
Applicant : Mr T J Porter
Respondent : Mr M J Rudge SC
Solicitors:
Applicant : Avon Legal
Respondent : K & L Gates
Case(s) referred to in decision(s):
Marine & Civil Bauer Joint Venture and Leighton Kumagai Joint Venture [2005] WASAT 269
Match Projects Pty Ltd and Arccon (WA) Pty Ltd [2009] WASAT 134
MRCN Pty Ltd t/as Westforce Constructions and ABB Australia Pty Ltd [2014] WASAT 59
Perrinepod Pty Ltd v Georgiou Building Pty Ltd [2011] WASCA 217
WQube Port of Dampier v Philip Loots of Kahlia Nominees Ltd [2014] WASC 331
Introduction
1 Marine & Civil Pty Ltd (Marine) seeks review of a decision of an adjudicator appointed under the Construction Contracts Act 2004 (WA) (CC Act) to adjudicate Marine's disputed payment claim against WQube Port of Dampier Pty Ltd (Dampier). That decision, made on 19 June 2014 by the appointed adjudicator, Mr Graham Morrow, was to dismiss the application for adjudication before him (Adjudication Application) on the ground that it had not been prepared and served in accordance with the CC Act.
2 The respect in which Mr Morrow found the Adjudication Application to be noncompliant was that it did not contain the Australian Business Number (ABN) of the Institute of Arbitrators and Mediators Australia (IAMA), the appointor chosen by the parties to appoint the adjudicator. The appointor's ABN is one of a number of details prescribed by regulation to be included in adjudication applications, on the proviso that the applicant 'knows those details'.
3 In essence, Marine contends that its stated position, that Marine did not know IAMA's ABN, should have been accepted by Mr Morrow, and should be accepted by the Tribunal on review. It goes further, and argues that the adjudicator should not, after the Adjudication Application and response to it were provided, have sought the parties' further submissions in relation to the issue concerning IAMA's ABN. This was, among other reasons, because Mr Morrow should have inferred that Marine did not know the ABN from its failure to provide it. On review, according to Marine, the Tribunal should draw the same inference.
4 Marine submits that neither the adjudicator nor the Tribunal should have regard to the information and documents received by Mr Morrow in response to his request for further information.
5 Finally, to the extent that the Tribunal chooses to have regard to such material, Marine submits that it should be able to rely on evidence, not put before Mr Morrow, on the issue of Marine's knowledge of IAMA's ABN.
6 Before I consider these and other matters relevant to the exercise of the Tribunal's review function, I will refer to a number of provisions of the CC Act, as well as provisions of the State Administrative Tribunal Act 2004 (WA) (SAT Act) pertinent to the matter.
Statutory framework CC Act
7 A party to a construction contract may apply for adjudication of a 'payment dispute' under Pt 3 of the CC Act. A payment dispute arises for the purposes of the CC Act if, by the time when the amount claimed in a payment claim is due to be paid under the contact, the amount has not been paid in full, or the claim has been rejected or wholly or partly disputed: s 6 of the CC Act.
8 Section 26, s 27, s 28, s 30, s 31 and s 32 of the CC Act state relevantly:
26. Applying for adjudication
(1) To apply to have a payment dispute adjudicated, a party to the contract, within 28 days after the dispute arises or, if applicable, within the period provided for by section 37(2)(b), must
(a) prepare a written application for adjudication;
(b) serve it on each other party to the contract;
(c) serve it
(i) if the parties to the contract have appointed a registered adjudicator and that adjudicator consents, on the adjudicator;
(ii) if the parties to the contract have appointed a prescribed appointor, on that appointor;
(iii) otherwise, on a prescribed appointor chosen by the party;
…
(2) The application
(a) must be prepared in accordance with, and contain the information prescribed by, the regulations;
(b) must set out the details of, or have attached to it
(i) the construction contract involved or relevant extracts of it; and
(ii) any payment claim that has given rise to the payment dispute;
(c) must set out or have attached to it all the information, documentation and submissions on which the party making it relies in the adjudication.
(3) A prescribed appointor that is served with an application for adjudication made under subsection (1) must comply with section 28.
27. Responding to an application for adjudication
(1) Within 14 days after the date on which a party to a construction contract is served with an application for adjudication, the party must prepare a written response to the application and serve it on
(a) the applicant and on any other party that has been served with the application; and
(b) the appointed adjudicator or, if there is no appointed adjudicator, on the prescribed appointor on which the application was served under section 26(1)(c).
(2) The response
(a) must be prepared in accordance with, and contain the information prescribed by, the regulations;
(b) must set out the details of, or have attached to it, any rejection or dispute of the payment claim that has given rise to the dispute; and
(c) must set out or have attached to it all the information, documentation and submissions on which the party making it relies in the adjudication.
28. Appointment of adjudicator in absence of agreed appointment
(1) If an application for adjudication is served on a prescribed appointor the appointor, within 5 days after being served, must
(a) appoint a registered adjudicator to adjudicate the payment dispute concerned;
(b) send the application and any response received by it to the adjudicator;
(c) notify the parties in writing accordingly; and
(d) notify the Building Commissioner in writing accordingly.
…
Division 3 The adjudication process
30. Object of the adjudication process
The object of an adjudication of a payment dispute is to determine the dispute fairly and as quickly, informally and inexpensively as possible.
31. Adjudicator's functions
(1) In this section
prescribed time means
(a) if the appointed adjudicator is served with a response under section 27(1) 14 days after the date of the service of the response;
(b) if the appointed adjudicator is not served with a response under section 27(1) 14 days after the last date on which a response is required to be served under section 27(1).
(2) An appointed adjudicator must, within the prescribed time or any extension of it made under section 32(3)(a)
(a) dismiss the application without making a determination of its merits if
(i) the contract concerned is not a construction contract;
(ii) the application has not been prepared and served in accordance with section 26;
(iii) an arbitrator or other person or a court or other body dealing with a matter arising under a construction contract makes an order, judgment or other finding about the dispute that is the subject of the application; or
(iv) satisfied that it is not possible to fairly make a determination because of the complexity of the matter or the prescribed time or any extension of it is not sufficient for any other reason;
(b) otherwise, determine on the balance of probabilities whether any party to the payment dispute is liable to make a payment, or to return any security and, if so, determine
(i) the amount to be paid or returned and any interest payable on it under section 33; and
(ii) the date on or before which the amount is to be paid, or the security is to be returned, as the case requires.
32. Adjudication procedure
(1) For the purposes of making a determination, an appointed adjudicator
(a) must act informally and if possible make the determination on the basis of
(i) the application and its attachments; and
(ii) if a response has been prepared and served in accordance with section 27, the response and its attachments;
(b) is not bound by the rules of evidence and may inform himself or herself in any way he or she thinks fit.
(2) In order to obtain sufficient information to make a determination, an appointed adjudicator may
(a) request a party to make a, or a further, written submission or to provide information or documentation, and may set a deadline for doing so;
(b) request the parties to attend a conference with the adjudicator;
(c) unless all the parties object
(i) inspect any work or thing to which the payment dispute relates, provided the occupier of any place concerned consents to the entry and inspection;
(ii) arrange for any thing to which the payment dispute relates to be tested, provided the owner of the thing consents to the testing;
(iii) engage an expert to investigate and report on any matter relevant to the payment dispute.
(a) with the consent of the parties, extend the time prescribed by section 31(2) for making a determination;
(b) with the consent of the parties, adjudicate simultaneously 2 or more payment disputes between the parties;
(c) with the consent of all the parties concerned, adjudicate the payment dispute simultaneously with another payment dispute.
(4) If an appointed adjudicator adjudicates simultaneously 2 or more payment disputes, the adjudicator may, in adjudicating one, take into account information the adjudicator receives in relation to the other, and vice versa.
(5) An adjudicator's power to make a determination is not affected by the failure of either or both of the parties to make a submission or provide information within time or to comply with the adjudicator’s request to attend a conference with the adjudicator.
(6) To the extent that the practice and procedure in relation to adjudications is not regulated by this Part or the regulations, an appointed adjudicator may determine his or her own procedure.
9 The CC Act contains the following right of review under s 46:
46. Review, limited right of
(1) A person who is aggrieved by a decision made under section 31(2)(a) may apply to the State Administrative Tribunal for a review of the decision.
(2) If, on a review, a decision made under section 31(2)(a) is set aside and, under the State Administrative Tribunal Act 2004 section 29(3)(c)(i) or (ii), is reversed the adjudicator is to make a determination under section 31(2)(b) within 14 days after the date on which the decision under section 31(2)(a) was reversed or any extension of that time consented to by the parties.
(3) Except as provided by subsection (1) a decision or determination of an adjudicator on an adjudication cannot be appealed or reviewed.
Relevant provisions of the SAT Act concerning the Tribunal's review powers and commentary
10 The following sections of the SAT Act have significance for the purposes of this review matter:
27. Nature of review proceedings
(1) The review of a reviewable decision is to be by way of a hearing de novo, and it is not confined to matters that were before the decisionmaker but may involve the consideration of new material whether or not it existed at the time the decision was made.
(2) The purpose of the review is to produce the correct and preferable decision at the time of the decision upon the review.
(3) The reasons for decision provided by the decisionmaker, or any grounds for review set out in the application, do not limit the Tribunal in conducting a proceeding for the review of a decision.
29. Tribunal's powers in review jurisdiction
(1) The Tribunal has, when dealing with a matter in the exercise of its review jurisdiction, functions and discretions corresponding to those exercisable by the decisionmaker in making the reviewable decision.
(2) Subsection (1) does not limit the powers given by this Act or the enabling Act to the Tribunal.
(3) The Tribunal may
(a) affirm the decision that is being reviewed; or
(b) vary the decision that is being reviewed; or
(c) set aside the decision that is being reviewed and
(i) substitute its own decision; or
(ii) send the matter back to the decisionmaker for reconsideration in accordance with any directions or recommendations that the Tribunal considers appropriate,
- and, in any case, may make any order the Tribunal considers appropriate.
66 The adjudication process is clearly designed to be a rapid process which determines, if necessary, on an interim basis, whether the contractor is entitled to a disputed payment. As stated in the second reading speech, to which recourse may be had pursuant to s 19 of the Interpretation Act 1984 (WA), its primary aim is to keep the money flowing in the contracting chain by enforcing timely payment and sidelining protracted or complex disputes. The object of the adjudication process is expressly stated in s 30 of the CC Act, that is, to determine the dispute fairly and as quickly, informally and inexpensively as possible.
67 For the purposes of making a determination, an adjudicator must act informally and, if possible, make the determination on the basis of the application and its attachments, and, if a response has been prepared and served, the response and its attachments. Only if it is not possible to make a determination on those documents may the adjudicator require further information (s 32).
69 In my view, the whole scheme of the CC Act, and the particular provisions to which reference has been made above, is inconsistent with the concept of a hearing de novo within the ordinary meaning of s 27(1) of the SAT Act. It is necessary to read s 27(1) down to the extent necessary to remove that inconsistency.
70 Section 27 provides that the hearing may involve the consideration of new material, whether or not it existed at the time the decision was made. In my view, no new material should be permitted because, if the decision under review is reversed, and the matter referred back to the adjudicator, I consider that the adjudicator must remain bound to decide the matter on the material which was originally before the adjudicator in accordance with s 32 of the CC Act.
12 More recently, in MRCN Pty Ltd t/as Westforce Constructions and ABB Australia Pty Ltd [2014] WASAT 59 (MRCN), Member De Villiers had cause to consider the Tribunal's review function in the area of CC Act adjudications, and, in particular, whether there are ever any circumstances in which the Tribunal might allow the introduction of evidence not before the adjudicator. Member De Villiers found in the circumstances of the case before him, concerning the date upon which any payment dispute arose, that he should admit additional material under s 27 of the SAT Act. Having acknowledged, earlier in his reasons for decision, that adjudications generally occur simply on the basis of the adjudication application and the response, that applicants do not have a right to be provided with nor reply to the contents of responses, and adjudicators are required to act under severe time pressure, Member De Villiers held that assertions made by an officer of the respondent in a statutory declaration as to what was said at a meeting, which were inconsistent with other evidence of the respondent and not capable of anticipation by the applicant when preparing the adjudication application, meant that neither the adjudicator nor the Tribunal had before them sufficient material upon which to make a finding on a critical issue.
13 In my view, it is clear that the Tribunal must keep firmly in mind the limitations placed by Parliament upon adjudicators, such that the content of any duty of procedural fairness must be significantly constrained. The scheme of the CC Act militates against a party having a second opportunity to perfect its case, even on the basis of an adverse matter subsequently raised by its opponent that it may not have anticipated.
Matters not in dispute
14 The following facts and conclusions, referred to in Mr Morrow's decision, were either expressly agreed or not contested before me:
• The parties entered a contract under which Marine was obliged to undertake work forming part of the Dampier barge berth, described as:
Completion of the figure 20,000m² of hardstand laydown, services and washdown facility, protected by graded rock armour sea wall of approximately 5,000m².
• The work is 'construction work' as defined in s 4 of the CC Act, having particular regard to s 4(2)(c) of the CC Act (civil works) and the definition of 'civil works' in s 4(1) of the CC Act.
• The subject matter of the dispute referred to in the adjudication application is a 'construction contract' within the definition of that expression in s 3 on of the CC Act.
• On 31 March 2014, Marine made a 'payment claim' as defined in s 3 of the CC Act. Although Mr Morrow stated the amount of the claim to be $297,787.78 plus GST, the parties agree this was an error, and the correct amount is $2,325,409.23.
• On 11 April 2014, Dampier either rejected or wholly or partly disputed the payment claim, and therefore a payment dispute arose on that day.
15 Having regard to the above matters, combined, in the case of any conclusion, with the reasoning contained in Mr Morrow's decision, I consider that none of the grounds for dismissal of the adjudication application without making a determination on the merits appearing in s 31(2)(a)(i), s 31(2)(a)(iii) nor s 31(2)(a)(iv) of the CC Act exists.
16 This leaves the ground for dismissal invoked by the adjudicator under s 31(2)(a)(ii) of the CC Act.
17 I note Mr Morrow's finding, with which the parties agree, and I so find, that the Adjudication Application was served on the appointor, IAMA (which, under the contract between the parties, was the appointed prescribed appointor) within the 28 day period for doing so under s 26(1) of the CC Act.
18 It is common ground that the dispute concerning Mr Morrow's conclusion that the adjudication application was not 'prepared and served in accordance with section 26', as required by s 26(2) of the CC Act, turns on whether or not the failure to provide IAMA's ABN amounted to noncompliance with the relevant regulations.
How does the issue of incomplete contact details arise?
19 Section 26(2)(a) of the CC Act provides that the application must be prepared in accordance with, and contain information prescribed by, the regulations, which is a reference to the Construction Contracts Regulations 2004 (WA) (CC Regulations).
20 Regulation 5 of the CC Regulations provides that:
5. Prescribed information in application for adjudication
For the purposes of section 26(2)(a) of the Act, an application to have a payment dispute adjudicated must, in addition to the other information required by section 26(2) of the Act, contain
- (a) the name of the appointed adjudicator or prescribed appointor and the adjudicator's or appointor's contact details;
(b) the applicant's name and contact details; and
(c) the respondent's name and contact details.
If a person is required by these regulations to give the contact details of a person, the person required to give the details must give the address, telephone and facsimile numbers and ABN of the person or the person's business (or ACN of the person if there is no ABN) to the extent to which the person required to give the details knows those details.
22 The Adjudication Application, served on IAMA in accordance with s 26(1)(c)(ii) of the CC Act, contained the names of each of the applicant, the respondent and IAMA. It also provided complete 'contact details', having regard to the definition in reg 4 of the CC Regulations, for the applicant and respondent: addresses, telephone and facsimile numbers and ABNs. In the case of IAMA, however, it provided the address and telephone and facsimile numbers, but not the ABN.
23 Marine contends that this failure is not fatal to the Adjudication Application, having regard to reg 4 of the CC Regulations, because it did not 'know' that detail at the time.
24 In considering the Adjudication Application and the response to it, Mr Morrow formed the view that he should give the parties the opportunity to provide further submissions in relation to the IAMA ABN issue. He did so based upon the contents of Marine's solicitors' letter to IAMA dated 7 May 2014 enclosing the Adjudication Application. That letter referred to three other payment disputes between the parties submitted to IAMA on 3 April 2014 for adjudicators to be appointed. This, according to Mr Morrow's letter seeking the further submission:
… strongly suggests to me that the parties were both aware of the relevant contract details.
25 Marine's response to the adjudicator's invitation indicated that it had complied with the regulations, based on its assertions that Marine:
…
(c) did not provide IAMA'S ABN in the Application as it was not known by [Marine] at the date of the Application, given:
(i) the 'Institute of Arbitrators and Mediators (Western Australian Division)' does not list an ABN on its website (https:\\ nor is one included in the receipt of lodgement provided to [Marine] upon service of the Application at IAMA (see Annexure A);
…
… it was clearly referenced in correspondence received by the parties from IAMA with respect to the 3 previous Adjudication Applications on this project (correspondence attached).
27 The correspondence attached comprised three letters from IAMA to both Marine and Dampier dated 7 April 2014 notifying them of the adjudicator appointed in relation to the three other payment disputes. The foot of each letter contains IAMA's full name, ABN, postal address, telephone and facsimile numbers, and email and website addresses.
28 In his decision, Mr Morrow found that Marine did know of IAMA's ABN by virtue of the three earlier applications for adjudication, and therefore that the Application Adjudication had not been prepared in accordance with the regulations.
Was the adjudicator entitled to obtain further submissions and evidence?
29 Marine relies upon the division of an adjudicator's functions arising from the provisions of the CC Act regarding adjudications between 'dismissal decisions' under s 31(2)(a) of the CC Act and 'determinations on the merits' under s 31(2)(b) of the CC Act (as to which see Perrinepod Pty Ltd v Georgiou Building Pty Ltd [2011] WASCA 217 at [113]).
30 Marine submitted that the adjudicator's power to request further submissions or documents under s 32(2)(a) of the CC Act is limited to determinations on the merits, and that there is no such power prescribed in respect of a decision under s 31(2)(a) of the CC Act.
31 In my view, accepting that the 'adjudication' process under the CC Act might involve the two stages of consideration of whether to dismiss an adjudication application under s 31(2)(a) and a determination on the merits under s 31(2)(b), Marine's submission is not without difficulty.
32 The language of the CC Act, and particularly Pt 3 of that Act, is prone to use such expressions as 'decision', 'determination', 'determination on the merits' and their derivatives in a manner which might be perfectly reasonable in the context of the particular provisions in which they are used, but when one has regard, as one must, to the entirety of the CC Act, is not entirely satisfactory. I provide the following examples:
• Section 30 of the CC Act gives, as 'the object of an adjudication' of a payment dispute, the following:
To determine the dispute fairly and as quickly, informally and inexpensively as possible.
Despite the use of 'determined', it would be a strange result if the stated object applied only to the second stage of the adjudication process and not the first. This is particularly so, given the object is ascribed to 'an adjudication', which may involve the two identified functions. Indeed, it will on occasions be limited to the first, dismissal, function, the present case being an example.
• Section 31(2) of the CC Act, which is introduced by 'An appointed adjudicator must, within the prescribed time or any extension of it made under s 32(3)(a)', refers to both functions. This suggests that an extension given under s 32(3)(a) of the CC Act, expressed as a time extension 'for making a determination', applies to the dismissal function.
• Section 31(2)(a) of the CC Act uses the language of '(making) a determination of [the application's] merits', rather than simply 'a determination'. One wonders why, given a sharp distinction between decisions to dismiss and determinations, such clarification is required, particularly given the definition of 'determination' in s 3 of the CC Act as being a determination on the merits.
• With the possible exception of the powers expressed in s 32(2), the powers given to the adjudicator by s 32 of the CC Act do not obviously suit determinations on the merits to any greater degree than dismissals. Further, it may not be until towards the end of the adjudicator's cogitative process that he or she decides that dismissal is necessary, perhaps after exercising the powers set out in s 32 of the CC Act.
33 It may be that the meaning of, in particular, 'determination' and its derivatives changes according to the specific context. Although not ideal, this may result in outcomes which are more consistent with the objectives of the legislation.
34 For the reason which follows, it has been unnecessary for me to decide whether or not the power under s 32(2) of the CC Act to request further submissions applies where an adjudicator decides to dismiss an adjudication application under s 31(2)(a) of the CC Act.
35 Section 32(6) of the CC Act provides:
To the extent that the practice and procedure in relation to adjudications is not regulated by this Part or the regulations, an appointed adjudicator may determine his or her own procedure.
36 When I directed counsel for Marine to this provision, he accepted that the interpretation of the remainder of s 32 of the CC Act advocated by him meant, in the case of a decision to dismiss, that s 32(6) of the CC Act applied. Further, he accepted that an adjudicator with power to determine his or her procedure may call for additional submissions or information. These concessions are, in my view, well made.
37 I find that Mr Morrow was entitled to do as he did and call for additional submissions regarding the IAMA ABN issue, by reference to one of s 32(2)(a) or s 32(6) of the CC Act.
38 Marine also complained about the fact that Mr Morrow had referred, in addition to Dampier's written submissions on the IAMA ABN issue, to the three letters from IAMA to the parties in the other three payment disputes attached to those submissions. It did so on the basis that the letters constituted evidence, not submissions.
39 Although this distinction is no doubt correct, I do not believe that Mr Morrow overreached by having regard to the evidence provided to substantiate one of Dampier's submissions. As Dampier points out, Marine, in its response to the same request, provided an item of evidence to substantiate one of its submissions.
Is Marine entitled to rely on further evidence on the review?
40 Marine submitted that if the Tribunal was minded to take into account the parties' further submissions and other material, it ought to allow the parties to put on further material, as provided for by s 27(1) of the SAT Act.
41 This, it was said, was for two reasons:
a) the issue of knowledge concerned Marine's state of mind, and the parties should be permitted to put on evidence about that matter so as to ensure the Tribunal can produce the 'correct and preferable decision at the time of the decision upon review' as required by s 27(2) of the SAT Act; and
b) by taking into account the three IAMA letters, Marine ought to be given an opportunity to respond to that evidence 'as a matter of procedural fairness'.
42 I reject both rationales.
43 Although it is true that the IAMA ABN issue does concern Marine's state of mind, this does not of itself give rise to an exception to the general principle I have accepted as applying to reviews under the CC Act that parties should not be allowed to introduce material that was not before the adjudicator.
44 Marine relies upon the following passage from WQube Port of Dampier v Philip Loots of Kahlia Nominees Ltd [2014] WASC 331 (Loots) per Chaney J at [100] to support its submission:
It would be contrary to the object of the CC Act to provide a quick informal adjudication, on an interim basis, of payment disputes, to construe s 31(2) as requiring an adjudicator to embark upon an enquiry as to an applicant's state of knowledge in relation to a matter that has no bearing on either the process of adjudication or its merits.
45 This sentence is concerned with the inference which, according to Chaney J, an adjudicator is usually entitled to draw that a detail such as an ABN is unknown. If, as here, a basis exists for not drawing such an inference and the adjudicator gives both parties the opportunity to make submissions on the issue, there is no justification for an automatic entitlement to put on additional material in any review in the Tribunal.
46 The 'additional evidence' of the three IAMA letters formed part of Dampier's response to the request for further submissions by Mr Morrow on 17 June 2014. That request arose from Marine's covering letter to IAMA enclosing the Adjudication Application, which referred to the three matters previously submitted to IAMA, leading to Mr Morrow's 'strongly suggest' comment. At the time, Mr Morrow faced a deadline for his decision (which had already been extended) of 19 June 2014. Marine was furnished with the same request, and responded to it. Once both responses were received, it behove the adjudicator to make his decision before the extended deadline. This is not a case akin to MRCN, where, without the ability to furnish fresh evidence, the applicant would at a distinct disadvantage by reason of the process adopted by the adjudicator.
Did the Adjudication Application comply with the regulations concerning the provision of the appointor's contact details?
47 Mr Morrow decided that there was a failure to comply with the requirements of the CC Regulations constituted by Marine's omission of IAMA's ABN.
48 It is apparent that the adjudicator reached his conclusion with some reluctance, given the lack of materiality of the omitted detail to the payment dispute sought to be agitated. However, to quote him:
… Whilst this may be an error or oversight in the Act and/or regulations, it is not my role to deliberately ignore or fail to apply the Act, regulations and/or associated case law.
49 One of the cases referred to by Mr Morrow in his decision is Match Projects Pty Ltd and Arccon (WA) Pty Ltd [2009] WASAT 134 (Match).
50 In Match, the respondent argued that failures to comply with the requirements for the preparation and service of adjudication applications in accordance with the CC Act and CC Regulations can sometimes be overlooked.
51 The Tribunal, comprising the then President of the Tribunal, Chaney J, and Senior Member Raymond, disagreed, for the reasons set out in the following paragraphs of its decision:
64 Section 31(2)(a)(ii) requires that the adjudicator must dismiss the application if it has not been prepared and served in accordance with s 26. The language used conveys a clear obligation to comply. Arccon argues that 'strict compliance with the minutiae' of s 26(1) is not required. It submits that the context of the CC Act demands that the process of adjudication should not be subject to technical legal arguments of statutory construction. It relies upon the object of adjudication of a payment dispute set out in s 30, namely 'to determine the dispute fairly and as quickly, informally and inexpensively as possible'.
65 We do not accept that the plain wording of s 26(2) can be read down on the basis of recourse to the objectives of the adjudication process.
67 It is also clear that preparation of the application must comply with the requirements of s 26 that the application be prepared in accordance with the Construction Contracts Regulations 2004 (WA) (CC Regulations). If it is not, the adjudicator must dismiss the application. However, when regard is had to the CC Regulations, it will be seen that the information which must be provided with the application, in order that it can be prepared in accordance with the regulations, is inexact….
69 Consequently, when an adjudication application is made, the adjudicator will have to make a decision, based on the materials provided, as to whether or not there has been a compliance with s 26. If it is manifest from the applicant's documentation that there has been non-compliance, the adjudicator will be bound to dismiss, but otherwise, that decision will have to be made based on all of the information provided by the parties. Thus, for example, if the respondent provides documentation which shows that the names and addresses of the respondents were known by the applicant but were not included in the application, the adjudicator would be required to dismiss the application without consideration of its merits.
52 In undertaking an analysis of whether or not compliance has occurred, and recognising the significance of a finding that the omission of an especially insignificant detail from the Adjudication Application renders it subject to dismissal, I have been guided by further statements of Chaney J, sitting as a single judge of the Supreme Court, in Loots. There, Chaney J was concerned with applications for judicial review based upon two of the adjudications between the parties to this matter. The applications centred upon the identical missing contact detail as in the present case. Although dealing with the legal validity of decisions of the adjudicators before him, and the factual circumstances surrounding the omission of the relevant contact detail differed in one important respect from the present case, His Honour's observations are extremely helpful.
53 In Loots, affidavits from Marine's managing director and a solicitor concerned with the preparation of the adjudication applications in question attested to the deponent's personal lack of knowledge of IAMA's ABN. The solicitor went on to describe enquires made in order to extract contact details for IAMA, which did not disclose the ABN.
54 Chaney J said at [90]:
I am satisfied, on the basis of that evidence, that in fact the ABN or ACN of the appointor was not known to those directly involved in the preparation of the applications on behalf of Marine & Civil.
55 His Honour went on to consider and reject the following arguments advanced by the applicant before him in favour of the respondent having the relevant knowledge.
1) The respondent could readily have discovered IAMA's ABN either by a company search or from other correspondence received by the applicant from IAMA.
2) The respondent, or a company related to it, was previously involved in adjudication and arbitration with the applicant, where IAMA was the prescribed adjudicator and arbitrator respectively.
56 The limb of the first argument concerning a possible company search was rejected on the basis that reg 4 of the CC Regulations requires actual, and not constructive, knowledge.
57 As for the other correspondence received by the respondent from IAMA, His Honour said at [91]:
… Those letters postdate the relevant applications for adjudication, which were dated 3 April 2014. They do not assist in determining Marine & Civil's knowledge at the relevant date.
58 Chaney J was dismissive of the applicant's second argument, which relied upon proceedings in 2005 and 2003. His Honour said at [94]:
Neither of those facts, dredged up by WQube's legal advisers, provides a foundation upon which to conclude that, when it made the applications for adjudication the subject of these proceedings, Marine & Civil, or the relevant persons within that company, knew of IAMA's ABN[.]
59 Finally, Chaney J dealt with the applicant's contention that the two adjudicators, by assuming that the respondent did not know the relevant contact detail in the absence of any evidentiary material to support such an assumption, failed to exercise jurisdiction as follows at [85] [86]:
There can be no question that each of the adjudicators formed the opinion that an application had been prepared in accordance with s 26. They said as much in their reasons. As I have already noted, it is hardly surprising that they formed that opinion given that it was an admitted fact. There is no basis to contend that the adjudicators did not reach the required satisfaction as to compliance with s 26(2)(a)(ii).
Nor can it be said that there was no evidentiary material upon which that determination was based. There was an admission to that effect. Furthermore, a review of the applications would reveal that the only omission from the possible contact details that might be included was the ABN or ACN. Given that contact details were only required to be included to the extent to which they are known, and given that no point about the absence of those numbers was taken by WQube, and indeed WQube admitted to compliance with s 26(2)(a)(ii), it would have been reasonable for the adjudicators to infer that the ABN or ACN was not known to Marine &Civil. It cannot be said that there was no basis in the evidentiary material for the adjudicators to reach the conclusion which they did.
60 Marine's primary submission is that the Tribunal ought to follow the course recommended by Chaney J in Loots for adjudicators, namely, to infer that Marine did not know IAMA's ABN. Such inference was said to arise from the omission of that contact detail when all others were included, the fact that no point was taken of the omission by Dampier, and Dampier's admission, in its response to the Adjudication Application, of compliance with s 26 of the CC Act.
61 Marine relied particularly on the following statement of Chaney J in Loots at [100]:
… If a detail such as an ABN or ACN, or some other contact detail, is not shown on the application, it is open to an adjudicator to infer that that detail is not known to the applicant. That is especially so if compliance with s 26 is not in issue[.]
62 The factor present in this case which motivated Mr Morrow to approach the parties for further submissions was his strong suspicion, emanating from Marine's own reference to the other three payment disputes between the parties in respect of which IAMA was the appointor, that Marine did know the relevant detail. I have already explained why I consider he was entitled to act in relation to that suspicion in the way that he did.
63 The effect of Marine's reference was to give the adjudicator reason to consider rebutting the usual inference to which Chaney J referred. It is worth noting that Chaney J's proposition is expressed in terms that it would have been 'reasonable for the adjudicators to infer that the ABN… was not known to Marine …' and 'it is open to an adjudicator to infer that (the) detail is not known to the applicant', leaving open a contrary conclusion in an appropriate case.
64 I have set out Marine's response to Mr Morrow's call for further submissions. It is limited to the following relevant matters:
a) The assertion that Marine did not know IAMA'S ABN at the time of the Adjudication Application, and
b) The reference to IAMA'S website (together with a wholly irrelevant reference to IAMA'S lodgement receipt for the Adjudication Application).
65 In his decision, Mr Morrow makes the pertinent observation that:
The Applicant, despite the foreshadowed issue of the three previous applications to IAMA and correspondence generated by IAMA (par 4.7 of Appendix B), does not explain why it did not know in this situation these contact details and had not responded to par 4.7.
66 The three letters from IAMA to the parties in relation to the other three matters for adjudication contain all IAMA's references within the 'contact details' definition in the CC Regulations.
67 Marine contends that to 'fix' it with knowledge of the contact detail disclosed in the three letters, and apparently not elsewhere, would be contrary to the limitation appearing in Loots at [92] and [100] that the knowledge referred to in regulation 4 must be actual, and not constructive, knowledge.
68 Chaney J explained constructive knowledge in Loots in terms that:
... if information were ascertainable from some public source, a person making an application for adjudication should be taken to know the relevant details.
69 This is not a description which includes details which are known to have been included in correspondence received by such a person.
70 The question then arises as to whether the inclusion of a detail in correspondence received by a corporate entity is sufficient to ascribe to the entity knowledge of the detail. In Loots at [90], Chaney J indicated a required standard of whether or not the detail was known to those directly involved in the adjudication applications under consideration.
71 'Knowledge' is a variable concept which has exercised the minds of philosophers over the centuries. Mr Morrow considered four definitions of 'known' from the Macquarie Dictionary(3rd ed, 1999) and adopted the following two:
To be cognisant or aware of; to be acquainted with;
To be cognisant or aware, as of some fact, circumstances or occurrence; have information as about something.
72 Both these definitions are apt to describe 'actual knowledge' as it is commonly understood, and not the legal concept of 'constructive knowledge'.
73 Mr Morrow found Marine to have known IAMA'S ABN because the three other payment disputes meant that it was aware of, or acquainted with, that detail.
74 I agree with the adjudicator's finding in this regard for the stated reason.
75 In my view, Marine's submission is premised upon an unduly narrow interpretation of 'knowledge' for the relevant purpose. According to its submission:
The fact that the applicant had previously received a letter which contained the ABN of IAMA does not mean that the applicant is taken to be fixed forever with actual knowledge of that ABN number.
76 This is undoubtedly true, and formed the basis of Chaney J's rejection of the second of the applicant's arguments of knowledge in Loots. However, it is equally fallacious to argue that receipt of a letter containing a contact detail will never fix the recipient with actual knowledge. In Loots, Chaney J discounted the second limb of the applicant's first argument because the correspondence from IAMA in that case was after the adjudication applications. That is not so in the present case.
77 Marine itself informed IAMA by letter of the other three matters, thereby conveying knowledge of the author of the letter of the other matters. Mr Morrow gave Marine the opportunity to rebut the inference that those with the carriage of the Adjudication Application knew IAMA's ABN. Rather than explaining why those persons did not know, Marine merely incanted that the company 'did not know' and referred to the result of a search of IAMA's website. Dampier, for its part, relied upon the references to the ABN in correspondence from IAMA regarding the three other adjudication applications on the same project.
78 In my view, in light of the responses received by him, Mr Morrow correctly concluded that Marine did 'know' the contact detail omitted from the Adjudication Application for the relevant purpose.
Conclusion
79 Given the conclusion just stated, and the mandatory and strict regime of compliance with the requirements of the CC Regulations for adjudication applications, I consider that the correct and preferable decision is to affirm the adjudicator's decision to dismiss the Adjudication Application based upon s 31(2)(a)(ii) of the CC Act.
Order
80 The Tribunal will issue an order in the following terms:
1. The review application is dismissed.
2. The decision under review is affirmed.
I certify that this and the preceding [80] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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MR T CAREY, MEMBER
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