Pheonix Builders Pty Ltd v Deca Australia Pty Ltd - [2021] NSWSC 581

Supreme Court

New South Wales

Medium Neutral Citation: Pheonix Builders Pty Ltd v Deca Australia Pty Ltd [2021] NSWSC 581
Hearing dates: 18 May 2021
Date of orders: 18 May 2021
Decision date: 18 May 2021
Jurisdiction: Equity - Commercial List
Before: Rees J
Decision:
Refuse interim relief staying enforcement of adjudicator’s determination.

Catchwords:
BUILDING AND CONSTRUCTION – interim relief –applicant claims no construction contract – similar contention made to adjudicator, but withdrawn – adjudicator determined had jurisdiction – jurisdictional challenge now revived in this Court – respondent alleged to be insolvent – interim relief refused.

Legislation Cited:
Building and Construction Industry Security of Payment Act 1999 (NSW) ss 24, 25

Cases Cited:
Brodyn Pty Ltd v Davenport (2004) 61 NSWLR 421; [2004] NSWCA 394
Hakea Holdings Pty Limited v Denham Constructions Pty Ltd [2016] NSWSC 1120
IWD No 2 Pty Ltd v Level Orange Pty Ltd [2012] NSWSC 1439
Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd (2018) 264 CLR 1; [2018] HCA 4
Samsung Electronics Co Ltd v Apple Inc (2011) 217 FCR 238; [2011] FCAFC 156
Shell Refining (Australia) Pty Ltd v AJ Mayr Engineering Pty Ltd [2006] NSWSC 94

Category: Procedural rulings
Parties: Pheonix Builders Pty Ltd (Plaintiff)
Deca Australia Pty Ltd (First Defendant)
Australian Solutions Centre (Second Defendant)
Paul J. Hick (Third Defendant)
Representation:
Counsel:
D Byrne (Plaintiff)
L Shipway (First Defendant)
Solicitors:
HWL Ebsworth (Plaintiff)
Vincent Young (First Defendant)

File Number(s): 2021/139530

EX TEMPORE Judgment

HER HONOUR: This is an application by the plaintiff, Pheonix Builders Pty Ltd, for an interim order restraining the first defendant, Deca Australia Pty Ltd, from:

requesting an adjudication certificate pursuant to section 24(1)(a) of the Building and Construction Industry Security of Payment Act 1999 (NSW) (the Act),

serving a notice on the plaintiff pursuant to section 24(1)(b) of the Act, and

filing an adjudication certificate as a judgment for a debt pursuant to section 25 of the Act,

in connection with the adjudication determination issued by the second defendant, Australian Solutions Centre, on 11 May 2021 with number
2021-TASC-026 (the Determination), together with an order restraining Australian Solutions Centre from issuing an adjudication certificate in relation to the Determination.

In support of the application for interim relief, the plaintiff relied on an affidavit by its solicitor, David Jury, and accompanying documents in relation to the adjudication.

Facts

In July 2019, Deca submitted a quotation to the plaintiff and, in November 2019, a further quotation. The plaintiff says that, in January 2020, Deca's quotation was accepted, leading to a construction contract to undertake demolition and excavation works in Blakehurst. The contract price was $696,000 plus GST. The plaintiff advanced the same contention to the adjudicator, which was accepted: Determination at [24]. Assuming that the construction contract came into existence as pleaded, the relevant version of the Act is the current version.
As pleaded in the Technology and Construction List Statement, supported by Mr Jury's affidavit on information and belief,…

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: [2021] NSWSC 581
Decision Date: 18 May 2021

CaseChat Overview and Summary

Pheonix Builders Pty Ltd, the applicant, sought interim relief against Deca Australia Pty Ltd, the respondent, in a dispute over the existence of a construction contract. The matter was heard in the New South Wales Supreme Court. The applicant claimed that no construction contract existed between the parties and, consequently, the court lacked jurisdiction to hear the matter. This contention had been previously raised before an adjudicator, who determined that they had jurisdiction, but was later withdrawn by the applicant. However, the jurisdictional challenge was revived in this Court. Additionally, the applicant alleged that the respondent was insolvent, which it claimed justified the granting of interim relief.

The central legal issues before the court were whether the applicant had demonstrated a serious question to be tried concerning the existence of a construction contract and whether the applicant had shown that the respondent was insolvent. The court had to consider these factors in determining whether to grant interim relief. The court also needed to evaluate the applicant's jurisdictional challenge to the court's authority and the implications of the respondent's alleged insolvency on the application for interim relief.

The court found that the applicant had not established a serious question to be tried concerning the existence of a construction contract. The applicant had previously withdrawn its jurisdictional challenge before the adjudicator and could not now revive it. Furthermore, the court was not satisfied that the applicant had demonstrated the respondent's insolvency. The court held that the applicant had not met the necessary threshold for the grant of interim relief. Consequently, the application for interim relief was refused.

The court did not make any orders in favour of the applicant. The matter remained unresolved, with the underlying dispute concerning the existence of a construction contract and the jurisdictional challenge still pending. The court's decision focused on the procedural aspects of the application for interim relief and did not address the merits of the jurisdictional challenge or the existence of the construction contract.

Orders