Promax Building Developments Pty Ltd v 167 Lower Heidelberg Road Pty Ltd

The plaintiff, Promax Building Developments Pty Ltd, a construction contractor, brought a claim against the defendant, 167 Lower Heidelberg Road Pty Ltd, over an unpaid progress payment under a building contract. The dispute was heard in the Supreme Court of Victoria. The central issue before the court was whether the original payment claim, which was replaced by a revised invoice, had effectively been withdrawn, thereby rendering the revised invoice invalid as a payment claim under the Building and Construction Industry Security of Payment Act 2002 (Vic). The court had to consider the established practice between the parties, where progress claims were discussed between the contractor and a quantity surveyor appointed by the owner's financier, and revised invoices were subsequently issued by the contractor.

The court examined the nature of the interaction between the parties and the established practice of negotiating progress claims. It was noted that the replacement of the original payment claim by a revised invoice was part of an ongoing dialogue between the parties, and that the revised invoice was a direct result of the discussions between the contractor and the quantity surveyor. The court held that the practice of issuing revised invoices following discussions did not constitute a withdrawal of the original payment claim. It found that the revised invoice remained a valid payment claim under the Act, as it was a continuation of the original claim that reflected the outcome of the negotiations.

Following the decision in Kitchen Xchange v Formacon Building Services, the court determined that the original payment claim had not been withdrawn. The court held that the revised invoice, which incorporated the results of the negotiations, was a valid payment claim under the Act. Consequently, the defendant was required to pay the amount specified in the revised invoice within the stipulated timeframe. The court's decision underscored the importance of the established practice between the parties and the need for clarity in the communication of payment claims and revised invoices.

The court ordered the defendant to pay the amount specified in the revised invoice to the plaintiff within the timeframe mandated by the Building and Construction Industry Security of Payment Act 2002 (Vic). The defendant was also ordered to pay the plaintiff's costs of the proceeding, which were assessed or agreed upon.