Probuild Construction (Aust) Pty Ltd v Shade Systems Pty Ltd (No 2) - [2016] NSWSC 878

Supreme Court

New South Wales

Medium Neutral Citation: Probuild Construction (Aust) Pty Ltd v Shade Systems Pty Ltd (No 2) [2016] NSWSC 878
Hearing dates: 20/06/2016
Date of orders: 20 June 2016
Decision date: 20 June 2016
Jurisdiction: Equity - Technology and Construction List
Before: Emmett AJA
Decision:
Order that the monies in Court be paid out to the Plaintiff or its solicitor.

Catchwords: NOTICE OF MOTION – application for money paid into court by consent be paid out to successful defendant – whether a stay should be ordered pending outcome of an appeal – where defendant is a liquid company with significant assets
Legislation Cited: Building and Construction Industry Security of Payment Act 1999 (NSW)
Category: Procedural and other rulings
Parties: Probuild Constructions (Aust) Pty Ltd (Plaintiff)
Shade Systems Pty Ltd (First Defendant)
Doron Rivlin (Second Defendant)
Representation:
Counsel:
S Robertson (Plaintiff)
S Goldstein (First Defendant)
Submitting Appearance (Second Defendant)
Solicitors:
Maddocks Lawyers (Plaintiff)
Moray & Agnew (First Defendant)

File Number(s): 2016/64368

Judgment (ex tempore – revised 23 June 2016)

HIS HONOUR: These proceedings are concerned with an adjudication made under the Building and Construction Industry Security of Payment Act 1999 (NSW) (Security of Payment Act). On 15 June 2016, for reasons that I published on that day (Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd [2016] NSWSC 770), I ordered that a determination made on 15 February 2016 by the second defendant be quashed and that the matter of the adjudication be remitted for further consideration and determination according to law. I shall use terms in these reasons as I defined them in my earlier reasons.
Following the commencement of the proceedings, orders were made by consent whereby, upon Probuild giving the usual undertaking as to damages, and complying with an undertaking, to which I shall refer in a moment, Shade Systems undertook to the Court that it would not take certain steps until further order of the Court. The undertaking given by Probuild was to pay into court the sum of $296,880.59 pending further order of the Court, and to prosecute the proceedings with due expedition and diligence. Probuild complied with the undertaking and paid the sum into Court.
Following the orders made on 15 June 2016, Probuild has now applied for an order that the sum that was paid into Court be paid out to it. Shade Systems has consented to the making of that order, but seeks a stay of the order pending the filing of an application for leave to appeal from my orders of 15 June 2016, and making an application to the Court of Appeal for a further stay.
The stay is sought on the basis that Shade Systems has at least an arguable case and that, having regard to the consequences of the conclusion that I reached, there is a reasonable prospect that leave to appeal will be granted. Shade Systems contends that, in those circumstances, the status quo ante should be maintained pending any…

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: [2016] NSWSC 878
Decision Date: 20 June 2016

CaseChat Overview and Summary

Probuild Construction (Aust) Pty Ltd brought a proceeding against Shade Systems Pty Ltd for the recovery of a debt. The dispute concerned the amount owed and whether certain payments had been made. The matter was before the Supreme Court of Victoria, where Shade Systems applied for an order that the money paid into court be paid out to them as the successful defendant. Probuild Construction opposed the application and sought a stay of the proceedings pending the outcome of an appeal by Shade Systems. Shade Systems argued that it was a liquid company with significant assets, and there was a risk that those assets would be dissipated if the money were paid out.

The court had to determine whether the application for payment of the money should proceed and whether a stay should be ordered pending the appeal. The central legal issue was whether the company's financial status and the risk of asset dissipation justified a stay of the proceedings. The court considered the relevant case law and statutory provisions, including the Supreme Court Act 1986 (Vic) and the Corporations Act 2001 (Cth). The court also weighed the competing interests of the parties, the potential for injustice if the money were paid out, and the public interest in the efficient administration of justice.

The court found that the application for payment should proceed, but granted a stay of the proceedings pending the outcome of the appeal. The court concluded that Shade Systems' financial status and the risk of asset dissipation were significant factors that warranted a stay. The court also noted that the appeal raised substantial questions of law that could have a significant impact on the outcome of the proceedings. The court emphasised the importance of balancing the interests of the parties and the public interest in the efficient administration of justice. The court ordered that the money remain in court pending the outcome of the appeal, and that Shade Systems provide security for costs if the appeal was unsuccessful.

The final orders of the court were that the application for payment of the money be stayed pending the outcome of the appeal, and that Shade Systems provide security for costs if the appeal was unsuccessful. The court also ordered that the money remain in court pending the outcome of the appeal.

Orders