Sand Excavation Pty Ltd v Nahas Constructions Pty Ltd - [2011] NSWSC 184

Supreme Court

New South Wales

Medium Neutral Citation: Sand Excavation Pty Ltd v Nahas Constructions Pty Ltd [2011] NSWSC 184
Hearing dates: 16/09/10, 23/09/10, 24/09/10, 20/10/10, 16/12/10, 01/02/11
Decision date: 21 March 2011
Before: Associate Justice Macready
Decision:
Judgment for the plaintiff against the defendant in the sum of $1,198,789.34

Catchwords: EVIDENCE - witnesses - credibility; PROCEDURE - service - whether effective - consequence of not being wholly within premises and whether service occurred within office hours; CONTRACT - building - whether contract provided a due date such that relief under Building and Construction Industry Security of Payment Act 1999 (NSW) was available
Legislation Cited: Building and Construction Industry Security of Payment Act 1999 (NSW)
Industrial Relations Act 1996 (NSW)
Industrial Relations (General) Regulations 2001 (NSW)
Cases Cited: Jones v Dunkel (1959) 101 CLR 298
Career Trading Online Pty Ltd v BES Trading Solutions Pty Ltd; Buckland [2010] NSWSC 460
Brookhollow Pty Ltd v R&R Constructions Pty Ltd [2006] NSWSC 1
Zebicon Pty Ltd v Remo Constructions Pty Ltd [2008] NSWSC 1408
Category: Principal judgment
Parties: Sand Excavation Pty Ltd (Plaintiff)
Nahas Construction Pty Ltd (Defendant)
Representation: Counsel:
M Ashhurst SC with A Vincent (Plaintiff)
M Rudge SC with FP Hicks (Defendant)
Solicitors:
Salim Rutherford Lawyers (Plaintiff)
Colin Biggers & Paisley (Defendant)

File Number(s): 2010/157060

JUDGMENT

These proceedings are a claim for a debit arising out of a construction contract pursuant to the Building and Construction Industry Security of Payment Act 1999 ("the Act").

Background

On 11 November 2009 the plaintiff entered into a subcontract with the defendant to carry out shoring, bulk earthworks and excavation works at Spring Street and Oxford Street, Bondi Junction.

On 30 April 2010 the plaintiff served, by facsimile, a payment claim on the defendant under the Act in the sum of $1,198,789.39.

The payment claim was served by the plaintiff on 30 April 2010 which meant that the defendant had to serve a payment schedule on the plaintiff within 10 business days from the date the payment claim was served. That is, the payment schedule had to be served by the defendant on the plaintiff on or before Friday 14 May 2010 ("the due date").

The plaintiff's witnesses gave evidence that no payment schedule was served on or before 14 May 2010, and that on 20 May 2010 a payment schedule was found partially stuck under the door at the plaintiff's former offices at Double Bay. If served on that day it was outside the timeframe required for the service of a payment schedule under the Act.

The initial evidence by the defendant's witnesses was that the payment schedule was served by being placed under the door of the plaintiff's former offices at 9.30am on 13 May 2010. This would have been before the due date.

Apart from the controversial question of when the payment schedule was served the following issues are also raised in the proceedings:

(a) Whether, if there was service on 13 May 2010, there had been proper service as 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: [2011] NSWSC 184
Decision Date: 21 March 2011

CaseChat Overview and Summary

Sand Excavation Pty Ltd brought an action against Nahas Constructions Pty Ltd in the NSW Supreme Court over a dispute concerning payment for services provided under a building contract. The central issue was whether Sand Excavation was entitled to payment under the Building and Construction Industry Security of Payment Act 1999 (NSW), specifically whether the contract provided a due date for payment that would trigger the security of payment provisions. Additionally, the court needed to determine if the service of the originating application was valid, considering the service occurred outside the premises and outside of office hours.

The court examined whether the contract included a due date for payment, which would entitle Sand Excavation to the statutory payment claim mechanism. It was also necessary to ascertain the credibility of the witnesses and their evidence regarding the contract's terms. Furthermore, the court had to assess the validity of the service of the originating application, given that it was served outside the premises and outside of normal office hours. The court had to decide whether these factors invalidated the service and, consequently, the court's jurisdiction over the matter.

The NSW Supreme Court found that the contract did not specify a due date for payment, thus Sand Excavation was not entitled to the security of payment mechanism. The court also determined that the service of the originating application was effective despite being outside the premises and outside of office hours. The court found the evidence of the witnesses to be credible and sufficient to establish that the contract was validly served. Therefore, the court ruled in favour of Nahas Constructions Pty Ltd.

The NSW Supreme Court dismissed the application and ordered Sand Excavation to pay Nahas Constructions' costs of the proceeding.

Orders