Quickway Constructions Pty Ltd v Electrical Energy Pty Ltd

Quickway Constructions Pty Ltd (Quickway) appealed to the Court of Appeal of New South Wales against orders made by a single judge concerning payment claims and adjudication determinations made under the *Building and Construction Industry Security of Payment Act 1999* (NSW). The dispute involved claims for progress payments where the underlying contractual debts had been assigned to Electrical Energy Pty Ltd (Electrical).

The central legal issues before the Court of Appeal were whether payment claims made by Electrical were valid, and consequently, whether the adjudication determinations made in favour of Electrical were valid, given the assignment of the contractual debts. Specifically, the court had to consider the effect of the assignment on the ability of the assignee to make a valid payment claim under the Act.

The Court of Appeal reasoned that a payment claim under the Act must be made by the person who is entitled to progress payments under the construction contract. In this instance, the construction contract was between Quickway and a third party, and the right to progress payments under that contract had been assigned to Electrical. However, the court held that the assignment of the debt did not operate to transfer the right to make a payment claim under the *Security of Payment Act*. Therefore, Electrical was not the party entitled to progress payments under the construction contract at the time the payment claims were made. The court concluded that the payment claims were invalid, which in turn rendered the adjudication determinations invalid.

Consequently, the appeal was allowed. The adjudication determination made on 28 July 2017 was quashed, and the previous orders of the court were set aside. The court ordered that the amount paid to Electrical be repaid with interest, and that Electrical pay Quickway’s costs at first instance and on appeal.