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McNab Developments (Qld) Pty Ltd v MAK Construction Services Pty Ltd

McNab Developments (Qld) Pty Ltd v MAK Construction Services Pty Ltd

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Case Copied 16 September 2014 62 min read

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SUPREME COURT OF QUEENSLAND

CITATION:

McNab Developments (Qld) Pty Ltd v MAK Construction Services Pty Ltd & Ors [2014] QCA 232

PARTIES:

McNAB DEVELOPMENTS (QLD) PTY LTD
ACN 118 748 548
(appellant)
v
MAK CONSTRUCTION SERVICES PTY LTD
ACN 136 996 891
(first respondent)
ADJUDICATE TODAY PTY LIMITED
ACN 109 605 021
(second respondent)
HELEN DURHAM
(third respondent)

FILE NO/S:

Appeal No 10458 of 2013
SC No 5200 of 2013

DIVISION:

Court of Appeal

PROCEEDING:

General Civil Appeal

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

16 September 2014

DELIVERED AT:

Brisbane

HEARING DATE:

8 May 2014

JUDGES:

Gotterson and Morrison JJA and Jackson J
Separate reasons for judgment of each member of the Court, each concurring as to the orders made

ORDERS:

Appeal dismissed.1.

Appellant to pay the respondent’s costs of the appeal on the standard basis.2.

CATCHWORDS:

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TO AND RECOVERY OF PAYMENTS – where the appellant was a contractor and the first respondent was a subcontractor for a building project – where the first respondent served a payment claim on the appellant totalling $853,952.97 – where the appellant contended that the subcontract had been terminated due to the first respondent’s default – where the first respondent sought adjudication of its claim under the Building and Construction Industry Payments Act 2004 (Qld) – where the adjudication was heard by the third respondent – where the third respondent decided that the appellant owed the first respondent $241,441.20 – where the appellant claimed a right to liquidated damages under the subcontract – where the appellant’s right to liquidated damages depended on the date for practical completion – where the applicant filed an application to the Supreme Court seeking to void the adjudication or set it aside on a range of grounds – where the primary judge dismissed the application – where the appellant contends that the third respondent decided on a basis which the parties had not addressed – whether there was a denial of natural justice – whether the third respondent acted unreasonably

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – RECOVERY ON QUANTUM MERUIT – IN GENERAL – where the respondent did not notify the appellant of variation claims in accordance with the prescribed notice form – whether progress payments are permissible under common law or contract

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TO AND RECOVERY OF PAYMENTS – where the third respondent allowed a claim by the first respondent with respect to 15 day dockets – where the appellants allege that the third respondent did not engage in a proper evaluation of each claim – whether the third respondent committed jurisdictional error with respect to the day dockets

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TO AND RECOVERY OF PAYMENTS – where the appellant undertook rectification for defective works – where the appellant issued backcharges…

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: [2014] QCA 232
Decision Date: 16 September 2014

CaseChat Overview and Summary

In the matter of McNab Developments (Qld) Pty Ltd v MAK Construction Services Pty Ltd, the dispute arose between a contractor and a subcontractor over a building project. The subcontractor, MAK Construction Services, served a payment claim to the contractor, McNab Developments, for an amount of $853,952.97. McNab Developments argued that the subcontract had been terminated due to MAK Construction's default. MAK Construction sought adjudication of its claim under the Building and Construction Industry Payments Act 2004 (Qld). The adjudication was conducted by an adjudicator, who ruled that McNab Developments owed MAK Construction $241,441.20. McNab Developments claimed a right to liquidated damages under the subcontract, contingent upon the date for practical completion. They filed an application in the Supreme Court seeking to void or set aside the adjudication on various grounds. The primary judge dismissed the application, leading to the current appeal.

The court was tasked with addressing several legal issues, including whether the adjudicator acted on a basis not considered by the parties, whether there was a denial of natural justice, and if the adjudicator acted unreasonably. Further, the court examined whether progress payments were permissible under common law or the contract, particularly in light of MAK Construction's failure to notify McNab Developments of variation claims in the prescribed form. The court also considered whether the adjudicator properly evaluated each claim related to the 15-day dockets and whether the omission of one backcharge affected the overall validity of the adjudication.

The court found that the adjudicator did not act on a basis not addressed by the parties and that there was no denial of natural justice. The adjudicator's decisions were considered reasonable, and the court upheld the adjudication. The court also held that MAK Construction's failure to provide proper notice of variation claims did not preclude them from receiving progress payments. Additionally, the court found no jurisdictional error in the adjudicator's handling of the 15-day docket claims. The omission of one backcharge did not impugn the overall validity of the adjudication. Consequently, the appeal was dismissed.

The court ordered that the appeal be dismissed and that McNab Developments pay MAK Construction's costs of the appeal on the standard basis.

Orders

Orders of the court

Appeal dismissed.1.

Appellant to pay the respondent’s costs of the appeal on the standard basis.2.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	McNab Developments (Qld) Pty Ltd v MAK Construction Services Pty Ltd & Ors [2014] QCA 232
PARTIES:	McNAB DEVELOPMENTS (QLD) PTY LTD ACN 118 748 548 (appellant) v MAK CONSTRUCTION SERVICES PTY LTD ACN 136 996 891 (first respondent) ADJUDICATE TODAY PTY LIMITED ACN 109 605 021 (second respondent) HELEN DURHAM (third respondent)
FILE NO/S:	Appeal No 10458 of 2013 SC No 5200 of 2013
DIVISION:	Court of Appeal
PROCEEDING:	General Civil Appeal
ORIGINATING COURT:	Supreme Court at Brisbane
DELIVERED ON:	16 September 2014
DELIVERED AT:	Brisbane
HEARING DATE:	8 May 2014
JUDGES:	Gotterson and Morrison JJA and Jackson J Separate reasons for judgment of each member of the Court, each concurring as to the orders made
ORDERS:	Appeal dismissed.1. Appellant to pay the respondent’s costs of the appeal on the standard basis.2.
CATCHWORDS:	CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TO AND RECOVERY OF PAYMENTS – where the appellant was a contractor and the first respondent was a subcontractor for a building project – where the first respondent served a payment claim on the appellant totalling $853,952.97 – where the appellant contended that the subcontract had been terminated due to the first respondent’s default – where the first respondent sought adjudication of its claim under the Building and Construction Industry Payments Act 2004 (Qld) – where the adjudication was heard by the third respondent – where the third respondent decided that the appellant owed the first respondent $241,441.20 – where the appellant claimed a right to liquidated damages under the subcontract – where the appellant’s right to liquidated damages depended on the date for practical completion – where the applicant filed an application to the Supreme Court seeking to void the adjudication or set it aside on a range of grounds – where the primary judge dismissed the application – where the appellant contends that the third respondent decided on a basis which the parties had not addressed – whether there was a denial of natural justice – whether the third respondent acted unreasonably CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – RECOVERY ON QUANTUM MERUIT – IN GENERAL – where the respondent did not notify the appellant of variation claims in accordance with the prescribed notice form – whether progress payments are permissible under common law or contract CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TO AND RECOVERY OF PAYMENTS – where the third respondent allowed a claim by the first respondent with respect to 15 day dockets – where the appellants allege that the third respondent did not engage in a proper evaluation of each claim – whether the third respondent committed jurisdictional error with respect to the day dockets CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TO AND RECOVERY OF PAYMENTS – where the appellant undertook rectification for defective works – where the appellant issued backcharges…