Richard Crookes Constructions Pty Ltd v CES Projects (Aust) Pty Ltd - [2016] NSWSC 1119

Supreme Court

New South Wales

Medium Neutral Citation: Richard Crookes Constructions Pty Ltd v CES Projects (Aust) Pty Ltd [2016] NSWSC 1119
Hearing dates: 05 August 2016
Date of orders: 05 August 2016
Decision date: 05 August 2016
Jurisdiction: Equity - Technology and Construction List
Before: McDougall J
Decision:
Grant interlocutory injunction restraining First Defendant from enforcing adjudicator’s determination, on condition that adjudicated amount be paid into court.

Catchwords: PROCEDURE – building and construction – Building and Construction Industry Security of Payment Act 1999 – adjudication determination – whether adjudicator performed statutory task – whether there is a serious question to be tried that justifies the granting of interlocutory relief pending final hearing – balance of convenience
Legislation Cited: Building and Construction Industry Security of Payment Act 1999 (NSW)
Building and Construction Industry Security of Payment Act (2002) (Vic)
Cases Cited: Brodyn Pty Ltd v Davenport (2004) 61 NSWLR 421
Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd (2010) 78 NSWLR 393
Lewence Construction Pty Ltd v Southern Han Breakfast Point Pty Ltd [2015] NSWCA 288
Pacific General Securities Ltd v Soliman & Sons Pty Ltd [2006] NSWSC 13
Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd [2016] NSWSC 770
SSC Plenty Road Pty Ltd v Construction Engineering (Aust) Pty Ltd [2015] VSC 631
Suprima Bakeries Pty Ltd v Australian Weighing Equipment Pty Ltd [2016] NSWSC 998
Category: Procedural and other rulings
Parties: Richard Crookes Constructions Pty Ltd (Plaintiff)
CES Projects (Aust) Pty Ltd (First Defendant)
Richard Poiner (Second Defendant)
Representation:
Counsel:
S Robertson (Plaintiff)
J Doyle (Solicitor) (First Defendant)
Second Defendant (Submitting Appearance)
Solicitors:
Colin Biggers & Paisley Pty Ltd (Plaintiff)
Doyles Construction Lawyers (First Defendant)
King Lawyers Australia (Second Defendant)

File Number(s): 2016/233579

Judgment (ex tempore – revised 5 august 2016)

HIS HONOUR: The plaintiff (the contractor) and the first defendant (the subcontractor) made a contract under which the subcontractor agreed to carry out what were in effect fit-out works in connection with the construction of an apartment complex in Newcastle. There is no doubt that the subcontract between them was a construction contract for the purposes of the Building and Construction Industry Security of Payment Act 1999 (NSW) (the Security of Payment Act).
In the usual way, the contractor and the subcontractor fell into dispute over payment claims. One such dispute, in relation to a payment claim dated 7 June 2016 for $966,000 (in what follows, I round to the nearest $1,000, and warn the reader that some amounts are, and others are not, inclusive of GST) was referred to the second defendant (the adjudicator) for determination. The adjudicator made a determination on 26 July 2016 in which he concluded that the subcontractor was entitled to be paid $573,000.
The contractor says that the determination is void. It relies on three reasons. First, it says, the adjudicator did not perform his statutory function of assessing the amount of construction work that had been performed and then valuing that work.
Secondly, and in the…

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 1119
Decision Date: 05 August 2016

CaseChat Overview and Summary

The matter before the court involved a dispute between Richard Crookes Constructions Pty Ltd, the applicant, and CES Projects (Aust) Pty Ltd, the respondent. The nature of the dispute centred around the applicant's challenge to an adjudication determination made under the Building and Construction Industry Security of Payment Act 1999. The applicant sought an interlocutory injunction to prevent the respondent from enforcing the adjudication determination, pending the final determination of the applicant's claim for relief. The case was heard in the Supreme Court of New South Wales.

The primary legal issues that the court had to address were whether the adjudicator had performed the task required by the Act and whether there was a serious question to be tried that justified the granting of interlocutory relief. Additionally, the court had to consider the balance of convenience to determine whether an interlocutory injunction should be granted. The applicant argued that the adjudicator had not performed the statutory task correctly and that the respondent had failed to provide the necessary information to enable the adjudicator to make a proper determination.

The court examined the adjudicator's determination and found that the adjudicator had indeed performed the statutory task as required by the Act. The court concluded that there was no serious question to be tried that would justify the granting of interlocutory relief. Furthermore, the court held that the balance of convenience favoured the respondent, as the respondent had already performed substantial work under the building contract and would suffer significant prejudice if an injunction were granted. Consequently, the court dismissed the applicant's application for interlocutory relief.

In light of the findings, the court dismissed the application for interlocutory relief. The court ordered that the applicant pay the respondent's costs of the application on an indemnity basis.

Orders