TQM v Dasein - [2004] NSWSC 1216

CITATION: TQM v Dasein [2004] NSWSC 1216

HEARING DATE(S): 3/12/04, 10/12/04

JUDGMENT DATE:
3 December 2004

JUDGMENT OF: McDougall J at 1

DECISION: See para [37] of judgment

CATCHWORDS: BUILDING AND CONSTRUCTION - Building and Construction Industry Security of Payment Act 1999 - whether adjudication determination void - where dispute as to date adjudication application served and received - natural justice - whether plaintiff denied natural justice in adjudicator taking into account material withheld from plaintiff - whether relief should be denied as matter of discretion when adjudicator considers payment schedule - whether adjudicator thereby taken to have considered whole of party's case

LEGISLATION CITED: Building and Construction Industry Security of Payment Act 1999

CASES CITED: Brodyn Pty Ltd v Davenport [2004] NSWCA 394

PARTIES :
TQM Design & Construct Pty Ltd (Plaintiff)
Dasein Constructions Pty Limited (subject to a Deed of Company Arrangement) (First Defendant)
National Electrical Communications Association (Second Defendant)

FILE NUMBER(S): SC 6406/04

COUNSEL: D T Miller (Plaintiff)
P G Fisher (First Defendant)
Submitting Appearance (Second Defendant)

SOLICITORS: Colin Biggers & Paisley (Plaintiff)
Paul Bard (First Defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

McDOUGALL J

3 December 2004 Ex tempore (Revised 7 December 2004)

(SUBJECT TO DEED OF COMPANY ARRANGEMENT)

JUDGMENT

1 HIS HONOUR: The plaintiff (“TQM”) and the first defendant (“Dasein”) are parties to a construction contract. Dasein made a payment claim under the contract. TQM did not accept the claim. Accordingly, Dasein referred the matter to adjudication. The adjudicator found in favour of Dasein. In doing so, he disregarded (for reasons that I will deal with in detail later) the adjudication response provided by TQM. The question for decision in these proceedings is whether the adjudicator's determination is void.

2 Dasein is in administration. Its administrator is Mr Silvia of Ferrier Hodgson. Much of the work relating to the administration has been handled by Mr Costa Nicodemou, an employee of Ferrier Hodgson, under the supervision of others. In particular, it appears, Mr Nicodemou prepared the payment claim and the adjudication application.

The issues

3 A number of issues were debated in the proceedings but it seems to me that there is a relatively easy road to the conclusion to which I have come. The essential issue of fact is whether the adjudication application was served on or received by TQM on 28 or 29 October 2004. The essential issue of principle is whether the adjudicator, Mr Davenport, denied TQM natural justice by failing to consider its adjudication response. An alternative issue, put impersonally, is whether TQM was denied natural justice because Mr Davenport took into account both evidence and submissions relating to the date of service provided to him by Mr Nicodemou on behalf of Dasein but not provided to TQM or its lawyers.

The legislation

4 Under the Building and Construction Industry Security of Payment Act 1999 (“the Act”), an adjudication application may be made in the circumstances set out in s 17(1). When made, it is by s 17(5)…

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.

Continue reading TQM v Dasein

Details

AGLC: TQM v Dasein [2004] NSWSC 1216
Case: [2004] NSWSC 1216
Decision Date: 3 December 2004

CaseChat Overview and Summary

The plaintiff, TQM, initiated proceedings against Dasein, an entity within the building and construction industry, in the Supreme Court of New South Wales. TQM sought a determination that an adjudication decision made by an adjudicator was void. The dispute arose from differing accounts regarding the date on which the adjudication application was served and received, which influenced the timing of the adjudication. The plaintiff contended that the adjudicator violated principles of natural justice by considering information that had not been provided to the plaintiff. TQM further argued that the adjudicator failed to consider the entire case when evaluating the payment schedule, suggesting that this oversight warranted a discretionary denial of relief.

The court was tasked with determining whether the adjudication determination was void due to the alleged procedural irregularities and whether the adjudicator's consideration of undisclosed information constituted a breach of natural justice. Additionally, the court needed to assess whether the adjudicator's failure to consider the full scope of TQM's case warranted a discretionary refusal of relief. The court also examined whether the adjudicator's assessment of the payment schedule inherently meant a review of the entire case, thereby potentially negating the claim of procedural unfairness.

The court found that the adjudication determination was not void, as the alleged procedural irregularities did not undermine the validity of the adjudicator's decision. The court held that the adjudicator did not breach natural justice by considering information withheld from the plaintiff, as the undisclosed material did not influence the outcome of the adjudication. The court further determined that the adjudicator's focus on the payment schedule did not preclude a comprehensive evaluation of TQM's case. Consequently, the court exercised its discretion not to set aside the adjudication determination, finding no basis to intervene on the grounds presented by TQM.

In light of the court's findings, TQM's application was dismissed. The court ordered that TQM bear the costs of the proceeding. This outcome underscored the importance of adhering to procedural requirements in adjudication processes while affirming the court's cautious approach in exercising its discretionary powers to overturn adjudication determinations.

Orders