Raw Build v JBK Industries (No 3) - [2017] VSC 766

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

TECHNOLOGY ENGINEERING AND CONSTRUCTION LIST

S ECI 2015 000374

RAW BUILD PTY LTD (ACN 159 255 142)	Plaintiff
v
JBK INDUSTRIES PTY LTD (ACN 106 713 115)	First Defendant
and
RICHARD HAPGOOD (IN HIS CAPACITY AS ADJUDICATOR IN AN ADJUDICATION UNDER THE BUILDING AND CONSTRUCTION INDUSTRY SECURITY OF PAYMENT ACT 2002 (VIC))	Second Defendant

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JUDGE:	VICKERY J
WHERE HELD:	Melbourne
DATE OF HEARING:	7 February 2017
DATE OF JUDGMENT:	7 February 2017
CASE MAY BE CITED AS:	Raw Build v JBK Industries & Anor (No 3)
MEDIUM NEUTRAL CITATION:	[2017] VSC 766

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BUILDING AND CONSTRUCTION – Building and Construction Industry Security of Payment Act 2002 (Vic) – Application for judicial review of a determination of an adjudicator – Application for writ of certiorari to quash a decision of an adjudicator – Jurisdictional error – Calculation of due date for payment of a progress payment – Application of s 12(1) of the Building and Construction Industry Security of Payment Act 2002 (Vic).

ADMINISTRATIVE LAW – Judicial review – Determination of an adjudicator appointed under the Building and Construction Industry Security of Payment Act 2002 (Vic) - Whether certiorari should be granted to quash the decision.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr D Cain	Kliger Partners
For the First Defendant	Mr A McKellar	Macpherson Kelley Lawyers

HIS HONOUR:

This proceeding arises under the Building and Construction Industry Security of Payment Act 2002 (Vic) (‘the Act’).

By originating motion dated 25 October 2015, the Plaintiff, Raw Build Pty Ltd (formerly known as Cubic Constructions Pty Ltd) (‘Raw Build’), seeks, amongst other things, firstly, an order by way of certiorari to quash the adjudication determination of the Second Defendant (‘the Adjudicator’), dated 16 October 2015 (‘the Adjudication Determination’), which is the second adjudication determination in this proceeding, and secondly, a declaration that the Adjudication Determination is unlawful and void.

Background

The background to this proceeding was outlined in Raw Build Pty Ltd v JBK Industries Pty Ltd.[1]
[1][2016] VSC 547.

By way of summary, Raw Build is a commercial and residential construction contractor. It was engaged as head contractor in the construction of a multi-storey residential development located at 486 Victoria Street, Richmond in the State of Victoria.

On or about 26 March 2014, Raw Build entered into a contract with the First Defendant in this proceeding, JBK Industries Pty Ltd (‘JBK’). Pursuant to this sub-contract, JBK was to undertake the mechanical works and services package for the project. The sub-contract sum was $130,000 plus GST.

On 25 July 2015, JBK issued a payment claim under the Act.

Raw Build did not provide a payment schedule under the Act in response to that payment claim.

On 22 September 2015 JBK served a notice of its intention to proceed to adjudication purportedly pursuant to s 18(2) of the Act.

Raw Build did not provide a payment schedule under the Act in response to the purported…

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: [2017] VSC 766
Decision Date: 7 February 2017

CaseChat Overview and Summary

Raw Build lodged an application for judicial review of an adjudicator’s determination and a writ of certiorari to quash the decision. The dispute arose out of an adjudication under the Building and Construction Industry Security of Payment Act 2002 (Vic) (Act). The primary issue before the court was whether the adjudicator made a jurisdictional error when determining the due date for payment of a progress payment. Specifically, it was a question of whether section 12(1) of the Act applied to the calculation of the due date.

The court found that the adjudicator had indeed made a jurisdictional error in his determination. The adjudicator had misunderstood the effect of section 12(1) of the Act, which provides that where a payment claim is not made within the period allowed by the building contract, the due date for payment is the date on which the payment claim is made. The adjudicator had instead calculated the due date as if the payment claim had been made within the period allowed by the building contract. This was a misinterpretation of the statutory provision and constituted a jurisdictional error. The court found that the adjudicator’s error was such that it could be quashed by certiorari.

Accordingly, the court granted the application for judicial review and the writ of certiorari. The determination of the adjudicator was quashed, and the matter was remitted to a different adjudicator for reconsideration. The court did not make any orders as to costs.

Orders