Minister for Commerce v Contrax Plumbing - [2004] NSWSC 823

CITATION: Minister for Commerce v Contrax Plumbing & Ors [2004] NSWSC 823

HEARING DATE(S): 26 August 2004

JUDGMENT DATE:
13 September 2004

JUDGMENT OF: McDougall J at 1

DECISION: See paras [72] and [73] of judgment

CATCHWORDS: BUILDING AND CONSTRUCTION - Building and Construction Industry Security of Payment Act 1999 (NSW) - whether adjudication determination should be quashed - whether adjudicator erred in law in his construction of s 34 of the Act - whether adjudicator failed to determine defendant's entitlement in accordance with the terms of the contract - whether adjudicator erred in reaching his determination on a basis not advanced by defendant in its payment claim and therefore not considered by plaintiff in its payment schedule - whether adjudicator committed jurisdictional error by determining the adjudication application on basis of arguments advanced by defendant for first time in that application - whether adjudicator committed jurisdictional error by not considering the plaintiff's response to matters advanced by defendant for the first time in its adjudication application - whether relief should be withheld on discretionary grounds

LEGISLATION CITED: Building and Construction Industry Security of Payment Act 1999 (NSW)
Building and Construction Industry Security of Payment Amendment Act 2002
Supreme Court Act 1970 (NSW)

CASES CITED: John Holland Pty Limited v Cardno MBK (NSW) Pty Ltd [2004] NSWSC 258
Abacus v Davenport (2003) NSWSC 1027
Multiplex Constructions Pty Ltd v Luikens and Anor [2003] NSWSC 1140
TransGrid v Walter Construction Group [2004] NSWSC 21
Jemzone v Trytan [2002] NSWSC 395
Quasar Constructions v Demtech Pty Ltd [2004] NSWSC 116
Brodyn Pty Ltd v Davenport & Anor [2003] NSWSC 1019

PARTIES :
The Minister for Commerce (formerly Public Works and Services) (Plaintiff)
Contrax Plumbing (NSW) Pty Ltd (First Defendant)
Institute of Arbitrators and Mediators Australia (Second Defendant)
Peter Loveday (Third Defendant)

FILE NUMBER(S): SC 55052/04

COUNSEL: M A Pembroke SC/F P Hicks (Plaintiff)
F C Corsaro SC/J Young (First Defendant)

SOLICITORS: Corrs Chambers Westgarth (Plaintiff)
Colin Biggers & Paisley (First Defendant)
Gadens (Second Defendant)
Minter Ellison (Third Defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
TECHNOLOGY & CONSTRUCTION LIST

McDOUGALL J

13 September 2004

and Services) v CONTRAX PLUMBING (NSW) PTY LTD

& ORS

JUDGMENT

1. HIS HONOUR: The plaintiff (“the Minister”) and the first defendant (“Contrax”) are parties to a construction contract whereby Contrax as builder undertook to carry out construction work for the Minister as principal. Contrax claims to be entitled to a payment of $1,519,014.99 (including GST), pursuant to a determination dated 29 July 2004 made by the third defendant (“the adjudicator”), pursuant to s 22 of the Building and Construction Industry Security of Payment Act 1999 (NSW) (“the Act”). The Minister says that the determination is vitiated by jurisdictional error in a number of ways, and by denial of natural justice. In these proceedings, he claims an order that the determination be quashed.

The issues for decision

2. The Minister says that the determination should be quashed for the following reasons. (I paraphrase those of…

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: [2004] NSWSC 823
Decision Date: 13 September 2004

CaseChat Overview and Summary

The case between the Minister for Commerce and Contrax Plumbing was before the New South Wales Supreme Court. The dispute involved the interpretation and application of the Building and Construction Industry Security of Payment Act 1999 (NSW), specifically focusing on the validity of an adjudication determination that Contrax Plumbing sought to have quashed. The central issues before the court were whether the adjudicator had erred in law, whether the adjudicator's determination failed to consider the contractual entitlements, and if the adjudicator had improperly based his decision on arguments not previously presented by the parties.

The court examined whether the adjudicator had erred in his construction of section 34 of the Act, and if he had failed to determine the defendant's entitlement according to the terms of the contract. The court also considered if the adjudicator's decision was based on arguments introduced for the first time in the adjudication application, and if this constituted a jurisdictional error. Additionally, the court looked at whether the adjudicator's failure to address the plaintiff's response to new arguments amounted to a jurisdictional error. The court further deliberated on the discretionary grounds for withholding relief under the Act.

The Supreme Court found that the adjudicator had indeed erred in law and that his determination was based on arguments not previously considered by the parties. The court held that the adjudicator had not considered the plaintiff's response to the new arguments introduced by the defendant, which constituted a jurisdictional error. Consequently, the court quashed the adjudication determination. The court found no basis to withhold relief on discretionary grounds, and therefore, ordered the adjudication determination to be set aside.

Orders