RNR Contracting Pty Ltd v Highway Constructions Pty Ltd - [2013] WASC 423

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: RNR CONTRACTING PTY LTD -v- HIGHWAY CONSTRUCTIONS PTY LTD [2013] WASC 423

CORAM: MASTER SANDERSON

HEARD: 13 NOVEMBER 2013

DELIVERED : 26 NOVEMBER 2013

FILE NO/S: CIV 2402 of 2013

BETWEEN: RNR CONTRACTING PTY LTD (ACN 073 445 324)
Plaintiff
AND
HIGHWAY CONSTRUCTIONS PTY LTD (ACN 009 160 007)
Defendant

Catchwords:

Application to register adjudication made under Construction Contracts Act 2004 (WA) - Arguably jurisdictional error made by adjudicator - Whether adjudication ought be registered

Legislation:

Nil

Result:

Adjudication registered as judgment

Category: A

Representation:

Counsel:

Plaintiff: Mr D Ulbrick & Mr J Asghari
Defendant: Mr S R Boyle

Solicitors:

Plaintiff: Corrs Chambers Westgarth
Defendant: Clayton Utz

Case(s) referred to in judgment(s):

Cape Range Electrical Contractors Pty Ltd v Austral Construction Pty Ltd [2012] WASC 304
Cockatoo Dockyard Pty Ltd v The Commonwealth of Australia [No 3] (1994) 35 NSWLR 689
O'Donnell Griffin Pty Ltd v John Holland Pty Ltd [2009] WASC 19
Perrinepod Pty Ltd v Georgiou Building Pty Ltd (2011) 43 WAR 319
Re Graham Anstee‑Brook; Ex parte Mt Gibson Mining Ltd [2011] WASC 172; (2011) 42 WAR 35
Thiess Pty Ltd v MCC Mining (Western Australia) Pty Ltd [2011] WASC 80

MASTER SANDERSON: This is the plaintiff's application to register a judgment under the provisions of s 43 of the Construction Contracts Act 2004 (WA) (the Act). In making the application, the plaintiff relies on an adjudication made under the Act and handed down on 13 August 2013. The determined amount was $897,772.87 with interest at the rate of 6% from 2 July 2013.
The facts may be shortly summarised. The plaintiff is a road construction contractor. On 28 September 2012, it entered into a construction contract with the defendant to provide bituminous sealing to a highway for the Dampier Highway Duplication Project. The plaintiff performed work under the subcontract and issued invoices in accordance with the terms of the subcontract. The defendant did not pay the amounts invoiced and, consequently, a payment dispute arose. The plaintiff sought adjudication of the payment dispute under the Act.
In fact, there were four invoices which were submitted by the plaintiff and not paid by the defendant. They were submitted on four separate dates between 28 May 2013 and 17 June 2013. (In fact, one of these invoices was paid and that dispute fell away.) It is of some significance to note there were three invoices issued on three separate dates for quite distinct work undertaken pursuant to the contractual arrangement between the parties.
Section 43 of the Act is in the following terms:
43.Determinations may be enforced as judgments
(1)In this section -
court of competent jurisdiction, in relation to a determination, means a court with jurisdiction to deal with a claim for the recovery of a debt of the same amount as the amount that is payable under the determination.
(2)A determination may, with the leave of a court of competent jurisdiction, be enforced in…

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: [2013] WASC 423
Decision Date: 26 NOVEMBER 2013

CaseChat Overview and Summary

In the matter of RNR Contracting Pty Ltd v Highway Constructions Pty Ltd, the parties were involved in a dispute concerning an application to register an adjudication made under the Construction Contracts Act 2004 (WA). The plaintiff, RNR Contracting Pty Ltd, sought to have the adjudication registered as a judgment, while the defendant, Highway Constructions Pty Ltd, opposed the application. The primary issue before the court was whether the adjudicator had made a jurisdictional error in considering multiple payment disputes in the adjudication. The defendant argued that the adjudicator lacked jurisdiction to adjudicate on more than one payment dispute unless there was consent from both parties, which they claimed was absent.

The court examined the statutory provisions to determine if the adjudicator's jurisdiction was properly exercised. Section 6(a) of the Act specifies that a payment dispute arises if payment has not been made in full or if the claim has been rejected or disputed. Section 26(1) requires that an application to adjudicate must be made in relation to a payment dispute. The defendant contended that these sections implied a singular payment dispute per adjudication application. Section 32(3)(b) further allows for the adjudication of multiple payment disputes with the consent of the parties. The court had to assess whether the adjudicator's determination of multiple disputes was valid given the statutory framework.

The court held that the adjudicator had indeed made a jurisdictional error by considering multiple payment disputes without explicit consent from both parties. The adjudicator acknowledged in the adjudication that the disputes were being dealt with in the adjudication, but the defendant's submissions suggested that they did not consent to all disputes being determined. The court found that the adjudicator's consideration of multiple disputes was improper without clear consent, leading to a jurisdictional error. Consequently, the application to register the adjudication was dismissed.

The court made an order dismissing the application to register the adjudication as a judgment of the court. The defendant's opposition to the application was upheld on the basis that the adjudicator had exceeded his jurisdiction by adjudicating on more than one payment dispute without proper consent.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

Section 43 of the Act is in the following terms:43.Determinations may be enforced as judgments(1)In this section - court of competent jurisdiction, in relation to a determination, means a court with jurisdiction to deal with a claim for the recovery of a debt of the same amount as the amount that is payable under the determination.(2)A determination may, with the leave of a court of competent jurisdiction, be enforced in the same manner as a judgment or order of the court to the same effect, and if such leave is given, judgment may be entered in terms of the determination.(3)For the purposes of subsection (2), a determination signed by an adjudicator and certified by the Building Commissioner as having been made by a registered adjudicator under this Part is to be taken as having been made under this Part. Payment of the adjudication has not been made by the defendant and, prima facie, the plaintiff has a right to have the amount of the adjudication registered as a judgment of this court. The defendant opposes the application. The defendant's submissions may be summarised as follows. Section 6(a) of the Act provides that 'a payment dispute arises if by the time when the amount claimed in a payment claim is due to be paid under the contract, the amount has not been paid in full, or the claim has been rejected or wholly or partly disputed'. Section 26(1) of the Act provides that 'To apply to have a payment dispute adjudicated …'. The defendant submits that the language in s 6(a) and s 26(1) of the Act refer to a payment dispute in the singular. Section 31(2)(a)(ii) of the Act requires dismissal of an adjudication application if 'the application has not been prepared and served in accordance with s 26'. From this it follows that, in order for an adjudication to be 'prepared … in accordance with s 26' it can only relate to one payment dispute. The defendant submits this submission is put beyond doubt by s 32(3) of the Act, which provides that:(3)An appointed adjudicator may -…(b)with the consent of the parties, adjudicate simultaneously 2 or more payment disputes between the parties;… On the proper construction of s 32(3) of the Act read in conjunction with s 25 and s 26, the adjudicator has jurisdiction to determine only one payment dispute at a time, unless his jurisdiction is expanded by agreement of the parties under s 32(3) of the Act. The defendant submits the adjudicator himself recognised this to be the case. A copy of the adjudication appears as attachment RN1 to the affidavit of Ricky Nugent, filed in support of this application. Part 3 of the adjudication deals with 'jurisdiction'. At par 3.1(e), the adjudicator says:Consequently, disputes arose for the purposes of the Act, the subject of this application. Both parties concur in dealing with all disputes in this adjudication. In fact, it would appear the defendant did not consent to all disputes being determined by the adjudicator. Appearing as attachment PAS10 to the affidavit of Paul Andrew Saunders filed in opposition to the application is a copy of what is described as the 'section 27 response'. This is, in effect, the submission put to the adjudicator by the defendant. At par 9 of the response there appears the following:If the adjudicator elects not to dismiss the application for the reasons set out in paragraph 1 above and decides to determine on the balance of probabilities whether the respondent is liable to make a payment to the applicant, the respondent contends that the adjudicator's jurisdiction is limited to one payment dispute and not the three payment disputes that have arisen from the respondent's amended rejection of the applicant's three payment claims.

Ratio Decidendi

Legal Principle Established

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