RJ Neller Building Pty Ltd v Ainsworth

Link copied
Case Copied 10 min read

DISTRICT COURT OF QUEENSLAND

CITATION:

RJ Neller Building Pty Ltd  v Ainsworth [2008] QDC 129

PARTIES:

RJ NELLER BUILDING PTY LTD

Plaintiff/Respondent

v

KJERULF DAVID AINSWORTH

Defendant/Applicant

FILE NO:

95 of 2007

DIVISION:

Civil

PROCEEDING:

Application

ORIGINATING COURT:

District Court, Maroochydore

DELIVERED ON:

25 June 2008

DELIVERED AT:

Maroochydore

HEARING DATE:

23 May 2008

JUDGE:

K S Dodds, DCJ

ORDER:

The application is refused with costs.

CATCHWORDS:

BUILDING CONTRACTS – RESOLUTION OF DISPUTES – ADJUDICATION – where respondent to adjudication brought proceeding in District Court arising out of same contract as adjudication – where proceeding in District Court brought after adjudicators certificate served on respondent to adjudication but before adjudicators certificate filed in District Court – whether enforcement warrant issued upon judgment in District Court on filing of adjudication certificate should be stayed

Building and Construction Industry Payments Act 2004 (Qld) s 31, s 100

Uniform Civil Procedure Rules r 667, r 791

Building and Construction Industry Security of Payment Act 1999 (NSW)

Cases cited:

Brodyn Pty Ltd v Davenport & Anor (2004) NSWCA 394

COUNSEL:

L C Alford for the plaintiff/respondent

P W Hackett for the defendant/applicant

SOLICITORS:

Ray Barber for the plaintiff/respondent

Morgan Conley Solicitors for the defendant/applicant

  1. This application by Kjerulf David Ainsworth sought:

    A declaration:

    §that RJ Neller Building Pty Ltd had notice that proceedings in the District Court at Brisbane (BD1247/2007) had been commenced prior to obtaining judgment on 3 May 2004 by filing an adjudication certificate pursuant to section 31 of the Building and Construction Industry Payments Act 2004 (the Act);

    Orders:

    §that the enforcement warrant issued by the District Court at Maroochydore on 6 March 2008 be set aside pursuant to rules 667 and 791 of the Uniform Civil Procedure Rules (UCPR);

    §that enforcement of the judgment of 3 May 2007 be stayed until further order pursuant to rule 800 of UCPR;

    §for costs on the indemnity basis.

  1. At the hearing, counsel for the applicant proposed that orders be made staying the enforcement warrant, granting liberty to apply and that the costs of the application be part of the parties costs in proceeding 1247 of 2007 upon the applicant’s undertaking not to encumber transfer assign or otherwise deal with certain real property upon which the respondent had performed building or construction work so as to reduce his equity therein below $150,000 pending final determination of proceeding 1247 of 2007.

Proceeding BD1247 of 2007

  1. On 2 May 2007 Ainsworth filed a claim and statement of claim in the District Court at Brisbane.  The claim sought:

    Declarations:

    §he was not indebted to RJ Neller Building Pty Ltd (Neller) in any amount;

    §an adjudicator appointed under the Act one, Philip Martin (Martin) had no jurisdiction to make a determination pursuant to the Act;

    §the adjudicator wrongfully determined liability pursuant to the Act;

    §the adjudication was invalid.

Orders:

§that the adjudication be set aside;

§for damages for loss suffered by Ainsworth due to defective and unfinished work of Neller;

§for damages for legal expenses incurred by Ainsworth…

CaseChat AU logo

Keep reading for free

Create a free CaseChat account to read RJ Neller Building Pty Ltd v Ainsworth and more:

  • Read every judgment in full
  • Ask AI and get answers linked to paragraphs
  • See how each paragraph was cited in later cases
  • Download judgments as PDF or Word
Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details
Case
[2008] QDC 129
Decision Date

CaseChat Overview and Summary

RJ Neller Building Pty Ltd and Ainsworth were involved in a dispute that originated from a building contract. Ainsworth brought a proceeding in the District Court, which arose from the same contract as a prior adjudication. The dispute centred on whether an enforcement warrant issued upon the judgment in the District Court should be stayed after the adjudicator's certificate was served on Ainsworth but before it was filed in the District Court. The core legal issue was whether the court should exercise its discretion to stay the enforcement of the judgment based on the prior adjudication, given the policy of the Building and Construction Industry Security of Payment Act, which aims for progress payments with minimal delay and court involvement.

The court examined whether Ainsworth had provided sufficient discretionary factors to persuade the court to stay the enforcement of the judgment. It was noted that Ainsworth, as a person of substance with a substantial equity in the property, would undertake not to diminish that equity below $150,000, while Neller was a $2 private company with significant financial risks. However, the court held that Ainsworth had not provided sufficient evidence beyond the risk of non-recovery if successful in the District Court proceeding to warrant a stay. The court emphasised that staying the enforcement would defeat the policy of the Act, which favours timely progress payments. Therefore, the court refused the application to stay the enforcement of the judgment with costs.

Orders

Orders of the court

The application is refused with costs.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Neller responded to the claim with a defence and counterclaim. The counterclaim sought that the adjudication and the amount found due by the adjudicator be upheld.Decision The relief sought by Ainsworth requires the exercise of the courts discretion in his favour. In that regard it is submitted he is a person of substance with a substantial equity in the property at the centre of the dispute and will undertake not to diminish that equity below $150,000 whereas Neller is a $2 private company registered since 2001 operating an overdraft secured over real property where the security is not provided by it and with a charge registered over its assets and undertakings. Although the principal, Mr Neller may be a registered builder for many years with a relatively large annual turnover, there is a risk that if ultimately successful in 1247 of 2007, Ainsworth may not recover the adjudicated amount from Neller if it is paid to Neller now. No doubt execution of a judgment upon an adjudication under the Act could in an appropriate case be stayed even though the policy of the Act is for progress payments with a minimum of delay and court involvement.[11] The party seeking the stay however has the task of persuading the court of discretionary factors in favour of that course sufficient to overcome the policy of the Act.[11] Brodyn Pty Ltd v Davenport & Anor (2004) NSWCA 394 at paragraph 87. I am not persuaded Ainsworth has done so. I am simply asked to infer that if Ainsworth is successful in 1247 of 2007 he may not recover the paid over adjudicated amount. Nothing other than that mentioned above to support that inference has been provided. On the other hand, a stay of the judgment based upon the adjudication will defeat the plain policy of the Act. The application is refused with costs.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.