S.H.A. Premier Constructions Pty Ltd v Niclin Constructions Pty Ltd

Link copied
Case Copied 46 min read

SUPREME COURT OF QUEENSLAND

CITATION:

S.H.A. Premier Constructions Pty Ltd v Niclin Constructions Pty Ltd [2020] QSC 307

PARTIES:

S.H.A. PREMIER CONSTRUCTIONS PTY LTD

ACN 056 777 318

(applicant)

v

NICLIN CONSTRUCTIONS PTY LTD

ACN 614 074 065

(first respondent)

KENNETH SPAIN, ADJUDICATOR J55780

(second respondent)

THE ADJUDICATION REGISTRAR, QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION

(third respondent)

FILE NO/S:

BS 3728 of 2020

DIVISION:

Trial Division

PROCEEDING:

Originating Application

DELIVERED ON:

2 October 2020

DELIVERED AT:

Brisbane

HEARING DATE:

28 May 2020; 29 May 2020

JUDGE:

Bond J

ORDER:

1.      The amended originating application filed 28 May 2020 is dismissed.

2.      I will hear the parties as to costs.

CATCHWORDS:

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – REMUNERATION – STATUTORY REGULATION OF ENTITLEMENT TO AND RECOVERY OF PROGRESS PAYMENTS – ADJUDICATION OF PAYMENT CLAIMS – where the applicant and first respondent were parties to three related contracts for the construction of petrol stations – where the contracts were terminated and the first respondent commenced court proceedings and also pursued relief under the Building Industry Fairness (Security of Payment) Act 2017 (Qld) – where the first respondent adopted inconsistent positions in each forum regarding whether the defects liability periods had been validly extended – where the applicant contends the adjudicator erred in deciding that the first respondent’s adjudication applications were not vexatious – whether the exercise of the adjudicator’s jurisdiction is conditioned on an adjudication application being not vexatious as a matter of fact, or on the adjudicator deciding that the application was not vexatious – whether the adjudicator misconceived his function by determining that the first respondent was entitled to claim for retention moneys as a component of its final payment claim – where the adjudicator recognised he was required to value the work by having regard to the estimated cost of rectifying certain defects, but neglected to value certain defects – whether such an error was a jurisdictional error or an accidental or erroneous omission within jurisdiction

Building Industry Fairness (Security of Payment) Act 2017 (Qld), s 71, s 72, s 75, s 84, s 88

Acciona Agua Australia Pty Ltd v Monadelphous Engineering Pty Ltd [2020] QSC 133, applied
BM Alliance Coal Operations Pty Ltd v BGC Contracting Pty Ltd [2012] QSC 346, considered
Gedeon v Commissioner of the New South Wales Crime Commission (2008) 236 CLR 120; [2008] HCA 43, cited
John Holland Pty Ltd v Roads & Traffic Authority of New South Wales [2007] NSWCA 19, cited
McDonald v Dennys Lascelles Ltd (1933) 48 CLR 457; [1933] HCA 25, cited
McNab Developments (Qld) Pty Ltd v MAK Construction Services Pty Ltd [2015] 1 Qd R 350; [2014] QCA 232, cited
Minister for Immigration and Citizenship v SZMDS (2010) 240 CLR 611; [2010] HCA 16, cited
Northbuild Construction Pty Ltd v Central Interior Linings Pty Ltd [2012] 1 Qd R 525; [2011] QCA 22, cited

Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR…

CaseChat AU logo

Keep reading for free

Create a free CaseChat account to read S.H.A. Premier Constructions Pty Ltd v Niclin Constructions... 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
[2020] QSC 307
Decision Date

CaseChat Overview and Summary

S.H.A. Premier Constructions Pty Ltd (SHA) and Niclin Constructions Pty Ltd (Niclin) were engaged in three contracts for the construction of petrol stations. Following the termination of these contracts, Niclin initiated court proceedings and pursued relief under the Building Industry Fairness (Security of Payment) Act 2017 (Qld). The primary legal issues centred on the adjudication of payment claims, particularly whether the adjudicator erred in deciding that Niclin’s applications were not vexatious, and if the adjudicator misconceived his function by determining that Niclin was entitled to claim retention moneys. SHA argued that the adjudicator's decision to include retention moneys as part of the final payment claim was not supported by the contract and thus constituted a jurisdictional error. Additionally, SHA contended that the adjudicator's oversight in not valuing certain defects amounted to a jurisdictional error or an erroneous omission within jurisdiction.

The court examined the statutory framework provided by the Building Industry Fairness (Security of Payment) Act 2017 (Qld), specifically section 88, which outlines the adjudicator's role and limitations in deciding payment claims. The court considered whether the adjudicator's jurisdiction was contingent on the adjudicator deciding that the application was not vexatious, or if it was a factual determination. The court also assessed whether the adjudicator's failure to value certain defects constituted a jurisdictional error or an accidental omission. The court concluded that the adjudicator's role was not to reach the objectively correct conclusion but rather to exercise the jurisdiction validly, and that the failure to value certain defects did not necessarily amount to a jurisdictional error.

The court dismissed SHA’s amended originating application filed on 28 May 2020, holding that the adjudicator's decisions were within their jurisdiction. The court noted that the adjudicator's oversight in not valuing certain defects did not amount to a jurisdictional error, and that the inclusion of retention moneys was permissible under the contract. The court also found that the adjudicator's determination that Niclin's applications were not vexatious was a matter of fact, not jurisdiction. The court reserved the matter of costs for further discussion between the parties.

Orders

Orders of the court

1. The amended originating application filed 28 May 2020 is dismissed.

2. I will hear the parties as to 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

Section 88 is in these terms:88 Adjudicator’s decision(1) An adjudicator is to decide—(a) the amount of the progress payment, if any, to be paid by the respondent to the claimant (the adjudicated amount); and(b) the date on which any amount became or becomes payable; and(c) the rate of interest payable on any amount.(2) In deciding an adjudication application, the adjudicator is to consider the following matters only—(a) the provisions of this chapter and, to the extent they are relevant, the provisions of the Queensland Building and Construction Commission Act 1991, part 4A;(b) the provisions of the relevant construction contract;(c) the payment claim to which the application relates, together with all submissions, including relevant documents, that have been properly made by the claimant in support of the claim;(d) the payment schedule, if any, to which the application relates, together with all submissions, including relevant documents, that have been properly made by the respondent in support of the schedule;(e) the results of any inspection carried out by the adjudicator of any matter to which the claim relates.(3) However, the adjudicator must not consider any of the following—(a) an adjudication response, to which the adjudication application relates, that was not given to the adjudicator within the time required under section 83;(b) a reason included in an adjudication response to the adjudication application, if the reason is prohibited from being included in the response under section 82.(4) Also, the adjudicator may disregard an adjudication application or adjudication response to the extent that the submissions or accompanying documents contravene any limitations relating to submissions or accompanying documents prescribed by regulation.(5) The adjudicator’s decision must—(a) be in writing; and(b) include the reasons for the decision, unless the claimant and the respondent have both asked the adjudicator not to include the reasons in the decision.(6) The adjudicator must give a copy of the decision, and notice of the fees and expenses to be paid to the adjudicator for the decision, to the registrar at the same time the adjudicator gives a copy of the decision to the claimant and respondent. One sees from s 88(1) that the adjudicator’s task is to decide the amount of the “progress payment” and, in deciding that amount, the adjudicator is to consider only the matters specified in s 88(2), is not to consider any of the matters specified in s 88(3), and must comply with s 88(5) concerning reasons. There were two ways in which SHA developed its attack on the subject adjudication decisions. Each may be analysed using the decision in relation to the Charleville contract as the appropriate example. First, SHA impugned the reasoning by which the adjudicator determined that Niclin should receive retentions under the contracts. It contended that the adjudicator could not identify any contractual basis for making that determination and must be taken to have allowed that part of Niclin’s claim upon some other (impermissible) basis. In this regard, in Acciona at [35], I observed that the following important matters must be noted in relation to this ground of jurisdictional error (footnotes omitted, emphasis added):(a) The valid exercise of an adjudicator’s jurisdiction is not conditioned on the adjudicator reaching what is objectively the correct conclusion on all of the questions of fact or law required by the consideration of the matters set out in s 88(2). Or, to put it another way, there are many errors of fact and law which might be made by an adjudicator which would not be regarded as going to jurisdiction.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.