WNA Construction Pty Ltd v Canberra Building and Maintenance Pty Ltd
[2025] ACTCA 17
•4 June 2025
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
COURT OF APPEAL
Case Title: | WNA Construction Pty Ltd v Canberra Building and Maintenance Pty Ltd |
Citation: | [2025] ACTCA 17 |
Hearing Date: | 20 May 2024 |
Decision Date: | 4 June 2025 |
Before: | McCallum CJ, Loukas-Karlsson and Baker JJ |
Decision: | The appeal should be dismissed. |
Catchwords: | CIVIL LAW – APPEAL – payment claim under Building and Construction Industry (Security of Payment) Act 2009 (ACT) – whether payment claim was “given” to the appellant – where payment claim was sent to a new email address – where new email address had same domain name as previously used email addresses – where no evidence was adduced as to the email address not being a valid email address in circumstances where it would have been easy to do so – Jones v Dunkel inference made – whether payment claim was sufficiently specific – where specificity requirement is not overly demanding – where there was reasonable identification of the work that was performed – appeal dismissed. |
Legislation Cited: | Building and Construction Industry (Security of Payment) Act 2009 (ACT), ss 6, 9, 10, 15 – 17, 19, 20 – 24, 27, 38, 43, pt 4, div 4.2 Building and Construction Industry Security of Payment Act 1999 (NSW), s 31 Legislation Act 2001 (ACT), ss 245, 247, 248, 250 Magistrates Court Act 1930 (ACT), pt 4.5 |
Cases Cited: | Allied Pastoral Holdings Pty Ltd v Federal Commissioner of Taxation [1983] 1 NSWLR 1 Ausipile Pty Ltd v Bothar Boring and Tunnelling (Australia) Pty Ltd [2021] QCA 223; 9 Qd R 220 Bloc Constructions(ACT) Pty Ltd v ABS Façade (ACT) Pty Ltd [2023] FCA 1282 Browne v Dunn (1894) 6 R 67 BSA Advanced Property Solutions (Fire) Pty Ltd v Ventia Australia Pty Ltd [2022] NSWCA 82; 108 NSWLR 350 Canberra Building and Maintenance Pty Ltd v WNA Construction Pty Ltd [2023] ACTSC 153 Ceerose Pty Ltd v A-Civil Aust Pty Ltd [2023] NSWCA 215; 112 NSWLR 225 Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd [2010] NSWCA 190; 78 NSWLR 393 Commercial Union Assurance Company of Australia Ltd v Ferrcom (1991) 22 NSWLR 389 Coordinated Construction Co Pty Ltd v Climatech (Canberra) Pty Ltd [2005] NSWCA 229 Farah Constructions v Say-Dee Pty Ltd [2007] HCA 22; 230 CLR 89 Harlech Enterprises Pty Ltd v Beno Excavations Pty Ltd [2022] ACTCA 42 Ho v Powell [2001] NSWCA 168; 51 NSWLR 572 John Holland Pty Ltd v Cardno MBK (NSW) Pty Ltd [2004] NSWSC 258 Jones v Dunkel [1959] HCA 8; 101 CLR 298 KDV Sport Pty Ltd v Muggeridge Constructions Pty Ltd [2019] QSC 178 Multiplex Constructions Pty Ltd v Luikens [2003] NSWSC 1140 Nepean Engineering Pty Ltd v Total Process Services Pty Ltd (in liq) [2005] NSWCA 409; 64 NSWLR 462 Neumann Contractors P/L v Peet Beachton Syndicate Ltd [2009] QSC 376; [2011] 1 Qd R 17 Piety Constructions Pty Ltd v Megacrane Holdings Pty Ltd [2023] NSWSC 2309 Probuild Constructions (Aust) Pty Ltd v DDI Group Pty Ltd [2017] NSWCA 151; 95 NSWLR 82 Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd [2018] HCA 4; 264 CLR 1 Protectavale Pty Ltd v K2K Pty Ltd [2008] FCA 1248 Style Timber Floor Pty Ltd v Krivosudsky [2019] NSWCA 171 T & M Buckley P/L v 57 Moss Rd P/L [2010] QCA 381; (2011) 27 BCLR 280 TFM Epping Land Pty Ltd v Decon Australia Pty Ltd [2020] NSWCA 93 Willmot v Queensland [2024] HCA 42; 419 ALR 623 |
Parties: | WNA Construction Pty Ltd ( Appellant) Canberra Building and Maintenance Pty Ltd ( Respondent) |
Representation: | Counsel B Buckland ( Appellant) A Greinke ( Respondent) |
| Solicitors Kamy Saeedi Law ( Appellant) Chamberlains Law Firm ( Respondent) | |
File Number: | ACTCA 27 of 2023 |
Decision Under Appeal: | Court/Tribunal: ACT Supreme Court Before: Curtin AJ Date of Decision: 22 June 2023 Case Title: Canberra Building and Maintenance Pty Ltd v WNA Construction Pty Ltd Citation: [2023] ACTSC 153 |
THE COURT:
Overview
1․The Building and Construction Industry (Security of Payment) Act 2009 (ACT) (Security of Payment Act) establishes a regime where a contractor can obtain an interim payment for construction work that it has performed. The purpose of the regime is to provide for the continuation of cash flow to contractors for building work, and hence to transfer the risk of insolvency from the contractor to the principal.
2․The scheme is triggered when a contractor (a claimant) sends a “payment claim” to the principal (the respondent). Upon receipt of the payment claim, the respondent has a short period of time in which to provide the claimant with a “payment schedule”, setting out any reasons for withholding payment. If the respondent does not provide the claimant with a payment schedule within the time specified under the legislation, the respondent becomes liable to pay the whole of the amount sought in the payment claim. Where this occurs, an adjudicator appointed under the Act will then determine the respondent’s liability to pay the whole, or part, of the amount sought in the payment claim. The adjudicator’s decision does not, however, determine any final rights between the parties. The respondent’s rights to dispute its liability under the contract, and to recover any amount paid that it was not liable to pay, are expressly preserved under the legislation.
3․This appeal concerns a payment claim that is alleged to have been issued by the respondent, Canberra Building and Maintenance Pty Ltd (Canberra Building), to the appellant, WNA Construction Pty Ltd (WNA) for work said to have been done by Canberra Building across 13 development sites in Canberra in late 2019 and early 2020.
4․There are two issues that arise for determination on this appeal. The first issue concerns whether the payment claim was “given” to WNA in accordance with the Security of Payment Act. In brief, WNA contends that Canberra Building failed to demonstrate that the email address to which the payment claim was sent was a valid email address of WNA. The second issue concerns the specificity of the payment claim. WNA contends that the payment claim did not describe the work that was performed by Canberra Building with sufficient specificity to enliven any obligations under the Security of Payment Act.
5․At first instance, Theakston LCM (the Magistrate) found in favour of WNA on both bases: that is, that Canberra Building had not demonstrated that the email address related to WNA, and that the payment claim did not sufficiently particularise the work that was said to have been performed. In upholding an appeal by Canberra Building against this decision, Curtin AJ (the appeal judge) held that the payment claim was sufficient to enliven the regime under the Security of Payment Act, and that the Magistrate had erred in finding that there was no evidence that the email address was related to WNA: Canberra Building and Maintenance Pty Ltd v WNA Construction Pty Ltd [2023] ACTSC 153 (the Appeal Judgment). WNA contends that the appeal judge erred in both findings.
6․For the reasons outlined below, WNA has not established error in the Appeal Judgment. Accordingly, the appeal should be dismissed.
Background
The issuing of the payment claim
7․WNA is a construction company which specialises in the construction of residential properties. Canberra Building is a company which undertakes construction work in the ACT and NSW.
8․Mr Lei (Eddie) Xia is the manager of WNA. His parents are the directors and shareholders of WNA. Mr Xia was unavailable to work from 15 October 2019 to 18 December 2019. For this reason, on or shortly after 15 October 2019, WNA engaged the services of Canberra Building to assist with overseeing a number of properties that were being developed by WNA, including at:
44 Vellacott Street, Denman Prospect
3 and 7 Chester Close, Holt
82 Lorrway Street, Holt
15 Fullston Way, Holt
60 Fitzhardinge Crescent, Evatt
86 Jaeger Street, Bruce; and
Various properties in Negus Street, Watson.
9․Mr Reid is the sole director of Canberra Building. In his affidavit, Mr Reid explained that he prepared a contract which set out the work that he understood was required to be performed. The contract, which was annexed to Mr Reid’s affidavit, was in broad terms, containing both hourly and salary rates for a builder/ project manager and a carpenter. The contract also set out the work to be performed at each site in broad terms. For example, under the heading “Denman Prospect 44 Vellacott St, Block 43, Section 10”, the contract stated:
Frame stage with fail protection installed on Friday
Next Steps
-Site clean and secure site
-Finish Frames and trusses
Tie downs missing
Bracing to be finished
Lintels installed
-Roof installed
-Windows installed
-Brick work cladding
-Finished to lock up with Garage door and the like
-Per sheet
-Ruff in, sparky, plumber
-Sheet
-Fit off
Fixout, wet areas, Kitchen BIRS, etc
-Paint
-Land scaping
-Defects
Trades info needed
Cerifier [sic]
Brick layers
Carpenters
Roofers
Plumbers
Window supplier
Tilers
Kitchen supplier
Plaster
10․The directions for 3 and 7 Chester Street, Holt; Block 40, Section 127; and, 15 Fullston Way, Holt were in similar terms. The work to be performed at the Watson properties was described in terms of unspecified “dwellings” (for example, “3 Dwellings site cut complete today 9/11/19 – Will meet plumber on site on Monday and determine when he can start and start the rest of the building process”).
11․This contract was not signed by the parties. After this contract was given to WNA by Mr Reid, there were a series of text messages between Mr Reid and WNA, in which Mr Reid was given further instructions about work to be performed on the properties. Mr Reid stated that he understood that Canberra Building was to charge at hourly rates in accordance with the rates stipulated in the contract.
12․Over the next few months, Canberra Building performed construction work for WNA on the properties and issued invoices for that work to WNA. Those invoices were sent by email to either Ms Campos, or Mr Howman. Ms Campos was an employee of WNA. She had been working with WNA since 2019. Mr Howman acted as bookkeeper to WNA, although he was not formally employed by the company. Canberra Building received payment for various of these invoices.
13․Mr Xia returned to work at WNA in early to mid-January 2020. Throughout January 2020, Mr Xia inspected work carried out by Canberra Building. He considered that the work performed by Canberra Building was defective. Consequently, Mr Xia terminated the contract with Canberra Building. Canberra Building ceased providing construction work for WNA at the end of January 2020.
14․On 16 April 2020, Mr Reid sent Canberra Building’s final invoice, Invoice No 217, to “[email protected]” (the ‘accounts’ email address), together with copies of earlier invoices that he had sent. This was the first time that Mr Reid had used this email address. As noted above, Mr Reid had previously sent invoices by email to either Ms Campos, or Mr Howman. The domain name of the email address (@wnaconstruction.com.au) was the same as the domain name of Ms Campos’ email address.
15․The email stated as follows:
To Eddie,
Please see attached our tax invoice for work completed at the following job sites per our contract:- Block and Section 13/64, 14/64, 16/64, 18/64, 19/64 & 21/64 Negus Street, Watson ACT 2602;
- 44 Vellacott Street, Denman Prospect ACT 2611;
- 3 and 7 Chester Close, Holt ACT 2615;
- 82 Lorrway St, Holt ACT 2615;
- 15 Fullston Way. Holt ACT 2615
- 60 Fitzhardinge Crescent, Evatt ACT 2617; and
- 86 Jaeger Street, Bruce ACT 2617.
We note claims for these works have previously been made and documents the works have previously been provided [sic]. However, please find attached these documents again for your reference. The amount is outstanding, and we would appreciate your prompt payment in full.
16․The email attached an invoice, Invoice No 217, which was dated 25 March 2020. That invoice stated:
Invoice For: Description:
WNA Constructions Pty Ltd ACN 630 651 624 Labour & Materials
Email: [email protected] [sic]
Ph:
[redacted]
[redacted]
DESCRIPTION
AMOUNT
For all work completed for WNA pursuant to our contract dated 9th November 2019 at the following job sites:
- Block and Section 13/64, 14/64, 16/64, 18/64, 19/64 & 21/64 Negus Street, Watson ACT 2602;
- 44 Vellacott Street, Denman Prospect ACT 2611;
- 3 and 7 Chester Close, Holt ACT 2615;
- 82 Lorraway Street Holt ACT 2615
- 15 Fullston Way, Holt ACT 2615
- 60 Fitzhardinge Crescent, Evatt ACT 2617; and
- 86 Jaeger Street, Bruce ACT 2617.
All work completed at agreed hourly rates per the contract and as provided to you previously via invoices no. 193, 194, 196, 198, 201, 202, 203, 204, 206 and 207.
Please be advised that due to an accounting error on the previously issued invoice no. 203, the correct total for invoice no. 203 is $6,154.50, which is reflected in this invoice.
Please be advised that due to an administrative error on the previously issued invoices no. 194, 196, 198, 202, 204 and 206, those invoices failed to confirm they were inclusive of work completed at 82 Lorraway Street, Holt ACT 2615, and 15 Fullston Way, Holt 2615.
Less part payments totalling $12,875.70 towards invoice 194.
This is a payment claim pursuant to the Building and Construction Industry (Security of Payment) Act 2009 (ACT)
Total Including GST
$53504.90
Terms: Due date for payment to be net 7 days
Deposit details [redacted]
17․The email also attached invoices 193, 194, 196, 198, 201, 202, 203, 204, 206 and 207.
18․These invoices varied in detail. For example, Invoice No 193 was described as being for two job sites: Negus St Watson and 44 Vellacott St Denman Prospect. The invoice then set out the following table:
Description
Hours
Hourly Rate
AMOUNT
25-Nov
28-Nov
29-Nov
29-Nov
30-Nov
1-Dec
1-Dec
Materials
Bobcat
Acro Prop, timbers, Generator hire
Steel lintels
Timbers CBM Stock items
Brick supplies
Sand
Cement and sarking
2
5
7
3.5
3
4
3
4
85
85
85
55
85
85
55
100
170
425
595
192.5
255
340
165
400
430
1497
216
1040
377
1293
Excluding GST
$7395.50
GST
$739.55
Total
$8135.05
19․Invoice No 194, which was described as relating to Chester St Holt and 86 Jaeger St Bruce, was in a similar format. However, this invoice specified where work was done by a foreman or a carpenter (a matter that could have been ascertained by the hourly rate in Invoice No 193). Invoice No 194 also separately particularised the materials for the Bruce and Holt premises.
20․Invoice Nos 196 and 198, which also related to Chester St Holt and 86 Jaeger St Bruce, were in the same form as Invoice No 193. However, again, the materials were separately particularised. Invoice No 198 also referred to attached Bunnings documents.
21․Invoice No 201, which related to Negus St Watson and 44 Vellacott St Denman Prospect was slightly more detailed. It set out the work performed in the following table:
Description
Hours
Hourly rate
AMOUNT
8-Jan Forman Materials drop off and measure up for fence quote
8-Jan Carpenter Widen window frames and install windows
9-Jan Forman Scheduling
9-Jan Carpenter Widen window frames and install windows
12-Jan Forman Pickup excavator and measure up eaves at Watson
Material Watson
1-Diesel for Truck and excavator
2-Eaves
3-19x19 Beading
Excluding GST
2
16
4.5
12
2.5
100
65
100
65
100
200
1040
450
780
250
124
211
37
$3092
GST
$309.20
Total
$3401.20
22․Invoice No 202, which related to Chester St Holt and 60 Fitzhardinge Cr Evatt, was more detailed still. It set out the work performed in the following table:
Description
Hours
Hourly rate
AMOUNT
6-Jan Forman
7-Jan Forman Meeting, Harvey Norman to pick up mixers, scheduling template
8-Jan Forman Measure up Evatt
9-Jan Forman Scheduling template, holt site inspection with sparking and check on plumbing progress
10-Jan Forman Material pickup and drop off for Evatt & instruct carpenters on works
10-Jan Carpenter Install, architraves, skirting and beading
11-Jan Forman Scheduling template, Holt: Install lock boxes, meet sparky on site, check on plumbing works, measure up blocking for garage door and man holes
Material Holt
1-Ply for front door
2-Lock Boxes
3=Security Cameras
Materials Evatt
1-Doors x 3, CSD roller, Flush pulls
2Architraves, Skirting, quad
TransLink 15% Hour Discount
Excluding GST
4
6
1.5
5.5
2
14
2
85
85
85
85
85
55
85
340
510
127.50
467.50
170
770
170
52
107
317
147
411
-415
$3174
GST
$317.40
Total
$3941.40
23․Invoice No 203, which related to Negus St Watson and 44 Vellacott St Denman Prospect, contained detailed descriptions as to the labour performed, and by whom (foreman and carpenter), but not by reference to the particular work site. However, like Invoices No 196 and 198, the materials claimed were particularised by work site.
24․Invoices No 204 and 206, which each related to Chester St Holt and 60 Fitzhardinge Cr Evatt, contained detailed descriptions of the work performed (eg “Evatt, Patched holes at, fixed fly screens, installed flush pulls”), with the majority of the labour specified by work site. The materials on each of these invoices were also specified by work site.
25․Invoice No 207, which related to Negus St Watson and 44 Vellacott St Denman Prospect, contained two line items for a carpenter and a labourer, which were not particularised by work site; materials which were particularised as only relating to the Denman Prospect site; and then included amounts for previous invoices overcharged and undercharged.
26․WNA did not issue a payment schedule or otherwise respond to the email dated 16 April 2020. WNA did not pay Invoice No 217, nor any of the invoices which it annexed.
The proceedings before the Magistrate
27․On 8 May 2020, Canberra Building commenced proceedings for debt in the Magistrates Court pursuant to the Security of Payment, claiming for the full amount of Invoice No 217, plus interest and costs.
28․In [9] of its Amended Statement of Claim (ASOC), Canberra Building asserted that:
On or about 16 April 2020, the plaintiff issued a payment claim within the meaning of section 15 of the Act, seeking payment in the sum of $53,504.90 (Debt)”.
Particulars
(i)Email of 16 April 2020 attaching invoice no. Invoice No 217 [sic].
29․In the remainder of the ASOC, Canberra Building asserted that WNA was required to issue a Payment Schedule within 10 business days, that WNA failed to issue a payment schedule or to pay the debt, and that, as a result, WNA owed Canberra Building the full amount of the debt, together with interest.
30․In its Amended Defence, WNA denied that Canberra Building was entitled to the relief sought. WNA asserted that it did not enter a written contract with Canberra Building as alleged or otherwise; that the written contract which Canberra Building alleged was entered into was void for uncertainty; and that any contract was an employment contract between Mr Reid and WNA, which did not render WNA liable to pay Canberra Building. In short, WNA admitted that it did not pay Canberra Building, but denied that it was liable to do so, and otherwise denied that Canberra Building was entitled to the relief sought in the ASOC.
31․In its Amended Defence, WNA did not assert that it had not received the payment claim that Canberra Building alleged it had “issued”. At [6] of its Amended Defence, WNA denied the allegations in [9] of the ASOC, repeated its allegations that there was no contract between Canberra Building and WNA and “[said] further that [Canberra Building] did not issue a valid payment claim within the meaning of s 15 of the Building and Construction (Security of Payment) Act 2009”.
32․In his opening address to the Magistrate, Mr Buckland, who appeared for WNA in the proceedings below and on this appeal, informed the Magistrate that the “employment contract issue” (see pleadings set out at [30] above) was not pressed. Mr Buckland indicated that WNA’s defence was that the payment claim, and, in particular Invoice No 217:
… didn’t comply with the requirement in subsection 1 [of s 15 of the Security of Payment Act] that the claim was made under the construction contract and so another person who is or may be liable to make the payment, nor does it properly identify as per subsection 2A the construction works to which it related.
33․Mr Buckland continued:
… to get the benefit of the presumption in section 17 about the debt being due and payable, which is the basis of the plaintiff’s claim, there are steps which they must follow to get the benefit of it, particularly those in section 15, and we say that in this circumstance, invoice 217 does not comply with those requirements – the two I’ve just identified to your Honour – and that will be made clear in the course of my argument.
34․In his opening address, Mr Buckland did not foreshadow any argument that the payment claim had not been received by WNA, nor that the ‘accounts’ email address was not a valid email address for WNA.
35․The evidence in the proceedings before the Magistrate consisted of an affidavit (with annexures) of Mr Reid (the sole director of Canberra Building) and a witness statement and oral evidence of Mr Eddie Xia (WNA’s primary employee, and the son of the owners of WNA).
36․In his affidavit, Mr Reid set out the commercial history between the parties, and explained the circumstances in which Canberra Building had agreed to work as a subcontractor for WNA. He annexed the contract, various text message exchanges between himself, Ms Campos and Mr Howman, and copies of previous invoices which had been invoiced, together with a bank statement demonstrating which invoices had been paid, and which remained unpaid.
37․Mr Reid said that in about February 2020, he had a conversation with Ms Campos, Mr Howman and Mr Xia, in which Mr Xia indicated that he would not pay the invoices which were then outstanding. Mr Reid then stated:
On 16 April 2020, I caused a payment claim to be issued to [WNA] in the amount of $53,504.90.
The Payment Claim was comprised of tax invoice no 217 issued by the plaintiff. Exhibited at TAB 6 is a copy of the Payment Claim.
I emailed the Payment Claim to Eddie Xia of [WNA], which was the usual process by which I would issue tax invoices on behalf of [Canberra Building] to [WNA] throughout the duration of the works under the Contract.
I did not receive any payment schedule or response from [WNA] within in [sic] response to the Payment Claim.
I have received no payment in whole or in part satisfaction of the Payment Claim.
38․Annexed to the affidavit was a copy of the email which Mr Reid sent (set out at [15] above) and Invoice No 217 (set out at [16] above).
39․In cross-examination, Mr Reid gave the following evidence explaining why he had sent Invoice No 217 to the ‘accounts’ email address:
MR BUCKLAND: All of the emails with invoices prior to April 2020 you sent to Kaye Campos or Peter Howman, correct?
MR REID: I will say yes. If that’s – if that’s the date you’ve got.
…
MR BUCKLAND: Yes. So why the change?
MR REID: They asked to change the email, to send it to somewhere else.
…
MR BUCKLAND: But you’d finished working for WNA at the end of January 2020, hadn’t you?
MR REID: Thereabouts, yes.
MR BUCKLAND: So there would’ve been no request in February or March or early April 2020, would there?
MR REID: Request for what?
MR BUCKLAND: To change the email address?
MR REID: When I was working for them it was.
MR BUCKLAND: So you say the request came while you were working for them?
MR REID: Because there was more than one email, so there was more than one email we could send it to.
MR BUCKLAND: But all the emails that you sent prior to 16 April, as I asked you a few minutes ago, were sent to Kaye Campos and Peter Howman?
MR REID: Yes, yes. Yes, and then I spoke to Peter after I left and he instructed me not to send him any more invoices because I no longer work for WNA.
MR BUCKLAND: Right. So you just, what, found the invoice on – you found the email address on the internet?
MR REID: No, I already had that – already had that email.
MR BUCKLAND: So you just elected to send it to somebody else?
MR REID: I don’t recall why I picked that particular email, what was the reason for it, so they would get it.
MR BUCKLAND: Why didn’t you send it to Kaye Campos?
MR REID: Because I was dealing with Eddy [sic] at that stage.
40․Later in the cross-examination, Mr Reid confirmed that he only sent Invoice No 217 by email, and that he had not posted the invoice or delivered it by hand.
41․Mr Reid was not asked any further questions, either in cross-examination, or in re-examination, concerning where, or when, he had originally obtained the ‘accounts’ email address. Nor was he has asked any questions about whether the email that he had sent had ‘bounced back’. Mr Reid was not asked whether he had received any notification suggesting that the email had not been received.
42․In his witness statement, Mr Xia explained the circumstances in which he was unavailable to work in late 2019 and said that he had a “very limited knowledge of what occurred between November 2019 and January 2020, particularly in relation to payments of accounts and invoices, as [he] did not receive them”.
43․Mr Xia said that when he became available to work in January 2020, he inspected Mr Reid’s work and formed the view that the work performed was defective. He said that he terminated Mr Reid’s “employment” in or around January 2020.
44․As to the payment claim, Mr Xia said:
I have seen the invoice number 217 from plaintiff. It is very confusing. I do not understand what work is being claimed for in that invoice.
45․Mr Xia did not provide any further explanation in his witness statement as to when, or where he had first seen Invoice No 217.
46․In his cross-examination, Mr Xia agreed that he had had a conversation with Mr Reid in February 2020 in which he (Mr Xia) had told Mr Reid that he would not pay Mr Reid’s invoices. Mr Xia then gave the following evidence.
MR SMITH: Do you know what invoices Mr Reid was referring to?
Mr XIA: I only – I cannot recall a lot of things, but they did show me a lot of – a bunch of invoice, which is when I read it as well, I really don’t understand.
MR SMITH: Yes, but do you recall seeing invoices?
MR XIA: Yes, of course.
MR SMITH: Do you recall what number those invoices were?
MR XIA: No.
MR SMITH: Or the date of those invoices?
MR XIA: No. I don’t actually pay attention to that, you know, to that at all, because I’m not in charge.
47․As Mr Xia was being asked questions about a conversation which he had with Mr Reid in February 2020, it would appear that the “invoices” which Mr Reid “was referring to” in that conversation were invoices which predated Invoice No 217 (which was not issued until April 2020).
48․Neither counsel asked Mr Xia whether he had seen Mr Reid’s email dated 16 April 2020 or Invoice No 217 prior to the commencement of litigation. Nor did either counsel ask Mr Reid whether the ‘accounts’ email address was a valid email address of WNA. There was no other evidence adduced by either party addressing whether or not the ‘accounts’ email address was a valid email address for WNA.
49․Although WNA’s pleadings did not clearly state that service of the payment claim was disputed, and although that issue had not been mentioned by Mr Buckland in his opening address on behalf of WNA, it appears that the Magistrate understood the question of service of the payment claim to be one of the issues in dispute between the parties.
50․Specifically, in determining an objection during Mr Xia’s cross-examination, the Magistrate asked Mr Buckland whether the issues in dispute were “just about service of the payment claim as well as whether or not the payment claim was void because it did not provide adequate details of the work” (emphasis added). At the conclusion of the evidence, the Magistrate again observed that he understood that one of the issues in dispute was whether he could be satisfied that the email was “given to the defendant”.
51․In responding to the Magistrate at these points, and in his closing submissions, the legal representative for Canberra Building did not raise the issue of whether service of the payment claim was raised on the pleadings. Rather, he contended that the sending of the email to the ‘accounts’ email address satisfied the legislative requirement that the payment claim be “given” to WNA.
52․After hearing oral submissions on behalf of Canberra Building, the Magistrate delivered a short ex tempore judgment finding in favour of WNA. In that decision, the Magistrate held that Canberra Building had not demonstrated that Invoice No 217 was served on WNA:
… the evidence is the payment claim was sent to an address and that address is accounts @wnaconstruction.com.au. Now, that domain name is consistent with the defendant’s name. And its also consistent with other email addresses used elsewhere within the material. But, there is simply no evidence that that precise email address relates to the defendant. And so, in those circumstances, I cannot be satisfied that the payment claim was, in fact, given to the defendant on 16 April 2020 or at any other time.
53․The Magistrate also found that Invoice No 217 failed to set out the construction work to which it related, and hence did not comply with s 15(2)(a) of the Security and Payment Act. In particular, his Honour held:
My concerns are that when you look at invoice 217 it just does not, in any real way, describe the construction work that the claim related to. While it describes a number of addresses, that in itself, is not enough.
While it makes references to a contract that, in itself, is not enough. There is a need to refer to the contents of the invoices that were attached. And while some invoices are quite detailed and more inadequate [as transcribed] for the purpose of meeting this requirement, some are not. So, for example, the very first invoice simply has seven dates and then a list of materials. And states two sites and I think on its face applying the test which is an assessment of the way the document patently appears taking into account any extrinsic relationship or evidence of a relationship between the parties it simply is inadequate to describe what the work relates to.
54․Drawing from various interstate authorities concerning relevantly similar legislation, his Honour continued:
Each indicate that the test is one that should be applied with common sense in a practical way. There’s no requirement for the description to be particularly technical but it needs to be adequate. And that means sufficient to provide the recipient with an understanding for the basis of the claim and therefore allow the recipient to provide a meaningful payment schedule which is a response to the claim.
In this case where the work is simply not identified the precise property is not identified. For example, stating two properties where the work may have been done, one or the other or both is simply not enough. And so therefore, I make a positive finding that the payment claim does not adequately identify the construction work or related goods and services to which the progress claims relate.
The proceedings in the Supreme Court
55․Canberra Building appealed from this judgment to the Supreme Court pursuant to pt 4.5 of the Magistrates Court Act 1930 (ACT).
56․In a judgment delivered on 22 June 2023, the appeal judge allowed the appeal on two bases. First, the appeal judge found that the Magistrate had erred in holding that the payment claim was not a valid claim under the Security of Payment Act [at [95]]. Second, the appeal judge found that the Magistrate had erred in finding that the payment claim had not been validly “given” to WNA [at [102]].
57․In addressing the first ground of appeal, the appeal judge observed that there is legislation in each Australian State and Territory which is in similar terms to the Security of Payment Act: Appeal Judgment at [62] – [66]; see similarly Harlech Enterprises Pty Ltd v Beno Excavations Pty Ltd [2022] ACTCA 42 at [46]; Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd [2018] HCA 4; 264 CLR 1 at [3]. His Honour then reviewed, in chronological order, various interstate authorities concerning the proper construction of provisions which are in relevantly identical terms to s 15 of the Security of Payment Act: Appeal Judgment at [68] – [87].
58․His Honour noted that supporting invoices in the present case “mentioned two sites” and that there was “no separation of labour/materials for one site from the labour/materials for the other”: Appeal Judgment at [94]. However, his Honour concluded that notwithstanding these deficiencies, “Invoice No 217, read with its supporting invoices, met Nepean’s undemanding test”: Appeal Judgment at [94]. His Honour continued (at [95] – [98]):
… Taking into account the speed with which these documents were to be produced, interpreting them in a common sense practical manner and remembering that what may appear as unintelligible shorthand to a lawyer would be readily understood by the parties who were experienced in the building industry and were familiar with the particular construction contract, I am of the view his Honour, with respect, erred in holding Invoice No 217 to be invalid for not identifying the construction work or related goods and services to which the progress payment related.
It is true, as WNA submitted, that the payment claim did not identify the work done by Mr Reid for which he charged “labour” in the payment claim. But the payment claim was not a pleading and did not need to be as precise as that type of document. When Canberra Building was contracted to provide the services of Mr Reid as foreman, then Mr Reid’s labour was self-evidently provided in that role and no more precise description was required. There was no need for Canberra Building to detail, almost on a time-charging basis, what particular work he was supervising on a building site at any given time. To require that level of detail would be to frustrate the purposes of the SOP Act.
In my view there was no failure to comply with s 15(2) of the SOP Act which was patent on the face of Invoice No 217. The invoice purported in a reasonable way to identify the particular work and any reasonable assertion by WNA that it was unable to identify some of the work could be made clear in a payment schedule justifying a refusal to pay, as Hodgson JA held. That dispute could then be determined by adjudication.
It follows that in my view his Honour erred in finding that the payment claim did not include the minimum amount of detail required.
59․In finding that the Magistrate had erred in finding that the payment claim had not been validly “given” to WNA, and hence allowing the second ground of appeal, the appeal judge took into account the following matters:
(a)In his affidavit, Mr Reid stated that he had “emailed the payment claim to Eddie Xia of [WNA]”. Although this statement was not in admissible form, no objection was taken to it, and it was admitted into evidence: Appeal Judgment at [104];
(b)In cross-examination, Mr Reid gave unchallenged evidence that “they” (that is, Ms Campos and Mr Howman) asked him to send his future invoices to “somewhere else”: Appeal Judgment at [105];
(c)Although Mr Reid could not recall why he had sent the email to the ‘accounts’ email address, he denied finding the ‘accounts’ email on the internet. He said that he did not send it to Ms Campos because he was dealing with Mr Xia at that time (as confirmed by the fact that the invoice began “Dear Eddie”): Appeal Judgment at [107] – [108];
(d)Mr Xia gave no evidence on the topic: “[h]e was a witness who one would have expected could have given evidence whether the email address used by [Mr Reid] was related to WNA, and whether WNA had received the email attaching Invoice No 217”: Appeal Judgment at [110].
60․Noting that the principle in Jones v Dunkel [1959] HCA 8; 101 CLR 298 is capable of application to a witness’ evidence in chief (Commercial Union Assurance Company of Australia Ltd v Ferrcom (1991) 22 NSWLR 389 at 418), the appeal judge continued (at [112]):
In my view [a Jones v Dunkel] inference should be drawn. That is, the most natural inference to draw from the failure of Mr Xia to address whether the email address used by Canberra Building was related to WNA, and whether WNA had received the email attaching Invoice No 217, was that WNA feared to adduce that evidence from him. That is therefore some evidence that such examination in chief would have exposed facts unfavourable to WNA. The result of that is that I am able to more readily accept Mr Reid’s evidence of service: Cross on Evidence, online ed, at [1215].
61․The appeal judge correctly observed that a Jones v Dunkel inference cannot be used to “fill gaps” in the respondent’s case: Appeal Judgment at [117]. However, his Honour held that there was “no gap” in Canberra Building’s case, as there was “evidence of service in Canberra Building’s written evidence in chief, and further oral evidence which emerged in cross-examination”: Appeal Judgment at [117].
62․For this reason, the appeal judge concluded that the Magistrate erred in finding that there was “no evidence the email address was related to WNA”: Appeal Judgment at [118]. In so finding, his Honour indicated that he did not place any weight on the similarity between Ms Campos’ email address and the ‘accounts’ email address, nor did he find that Mr Xia’s written statement that he had “seen invoice No 217” was an “admission against interest”, noting that Mr Xia had not said when he had seen the invoice: Appeal Judgment at [119], [121]. The appeal judge likewise rejected WNA’s contention that Canberra Building’s solicitor had “conceded” that there was “no evidence” that the ‘accounts’ email had any connection to WNA: Appeal Judgment at [122] – [126].
63․His Honour also rejected WNA’s contention that a Browne v Dunn (1894) 6 R 67 inference should be drawn against Canberra Building with respect to Canberra Building’s failure to put to Mr Xia that the payment claim was in fact received. In particular, his Honour noted that Browne v Dunn only applies where a witness gives evidence contrary to that of an opposing party’s witness, and that Mr Xia had not given evidence that the email was not received: Appeal Judgment at [128], citing Allied Pastoral Holdings Pty Ltd v Federal Commissioner of Taxation [1983] 1 NSWLR 1 at 16. His Honour found that “[a]s Mr Xia gave no evidence on the topic, there was no requirement to cross-examine him on the issue”: Appeal Judgment at [129].
64․Accordingly, his Honour allowed the appeal, set aside the Magistrate’s orders, and, in lieu thereof, entered judgment in favour of Canberra Building in the sum of $53,504.90 with interest and costs.
The Security of Payment Act
65․Before turning to consider the issues in dispute on the appeal, it is convenient to first set out the various provisions of the Security of Payment Act which establish a person’s entitlement to a progress payment for construction work, and the procedure for recovering those payments.
66․As to entitlement, s 10 of the Security of Payment Act provides that on and from each reference date, a person is entitled to a “progress payment”
if the person has undertaken to carry out construction work, or to supply related goods and services under a construction contract. The terms “construction contract” and “construction work” are both broadly defined: see ss 6 and 9 of the Security of Payment Act. The reference date is either the date stated in, or worked out, under the contract, for the progress payment, or, if the contract does not provide a date, is the “last day of the calendar month in which the construction work was first carried out, or the related goods and services were first supplied, under the contract” and the last day of each subsequent named month.
67․The procedure for recovering progress payments is set out in Part 4 of the Security of Payment Act.
68․Section 15 of the Security of Payment Act, which has particular significance for both grounds of appeal, provides as follows (emphasis added):
15Payment claim
(1)A person who is or who claims to be entitled to a progress payment under section 10 (1) (the claimant) may give a claim (a payment claim) to the person who, under the construction contract concerned, is or may be liable to make the payment (the respondent).
Note For how documents may be served, see the Legislation Act, pt 19.5
(2)A payment claim must—
(a)identify the construction work or related goods and services to which the progress payment relates; and
(b)state the amount of the progress payment that the claimant claims is payable (the claimed amount); and
(c)state that it is made under this Act (emphasis added).
(3)The claimed amount may include any amount—
(a)that the respondent is liable to pay the claimant under section 29 (3); or
(b)that is held under the construction contract by the respondent and that the claimant claims is due for release.
(4)A payment claim may be given on or after —
(a)the last day of the calendar month in which the construction work was first carried out, or the related goods and services were first supplied, under the contract and of each subsequent calendar month; or
(b)if the construction contract provides for a payment claim to be given before the last day of a calendar month—the day provided under the contract; or
(c)if the construction contract has been terminated—the day of termination.
(5)However, a payment claim may be given only before the later of—
(a)the end of the period worked out under the construction contract; and
(b)the end of the period of 12 months after the construction work to which the claim relates was last carried out or the related goods and services to which the claim relates were last supplied.
(6)A claimant must not give more than 1 payment claim for each calendar month, unless the construction contract provides for more than 1 payment claim to be given in a calendar month.
(7)Nothing in this section prevents the claimant from—
(a)including more than 1 progress payment in a payment claim; or
(b)including in a payment claim an amount that has been the subject of a previous claim; or
(c)giving the respondent a payment claim in a particular calendar month for work carried out, or related goods and services supplied, in an earlier calendar month.
69․After a payment claim is “given” to a respondent pursuant to s 15, the respondent “may reply to the claim by giving a schedule of proposed payment (a payment schedule) to the claimant”: s 16(1). Such a payment schedule must identify the payment claim to which it relates and state the amount of the payment, if any, that the respondent proposes to make: s 16(2). If the scheduled amount is less than the claimed amount, the schedule must indicate why the scheduled amount is less, and explain any reasons why the respondent is withholding payment: s 16(3).
70․If a respondent does not reply to the payment claim within the lesser of 10 days, or the time required under the relevant construction contract, “the respondent becomes liable to pay the claimed amount to the claimant on the due date for the progress payment to which the payment claim relates”: s 16(4). If the respondent does not then pay the progress payment on the due date, the claimant may either “recover the unpaid portion of the claimed amount from the respondent, as a debt due to the claimant, in any court of competent jurisdiction” or “make an adjudication application under s 19(1)(b) in relation to the payment claim”: s 17(2)(a). The claimant may also give notice of an intention to suspend carrying out construction work or supply related goods and services under the construction contract: s 17(2)(b).
71․Where the claimant commences proceedings for recovery of the debt in a court of competent jurisdiction, the court must not enter judgment in favour of the claimant unless it is satisfied that the respondent is liable to pay the claimed amount because it failed to provide a payment schedule within the time specified, and that the respondent has failed to pay the whole or any part of the claimed amount on or before the relevant due date: s 17(3)(a). In such a proceeding, the respondent is not entitled to bring a cross-claim, or to raise a defence in relation to any matter arising under the construction contract: s 17(3)(b).
72․Where the respondent provides a payment schedule in response to a payment claim within the time specified, and disputes in that payment schedule an entitlement to pay the whole, or part of the amount claimed, the dispute may be determined by an adjudicator pursuant to div 4.2 of the Security of Payment Act. An adjudicator must have “the qualifications, expertise and experience to perform adjudications”, and also must have “successfully completed a relevant training course”: s 20.
73․The procedure for adjudication is set out in ss 19, 21 and 22 of the Security of Payment Act. In brief, the claimant may make a written application for an adjudication: s 19(3). That application must, inter alia, “identify the payment claim and any payment schedule to which it relates” and may contain relevant submissions: s 19(3).
74․After an adjudicator is appointed and gives notice of acceptance, the respondent may give a response to the claimant’s adjudication at any time before the later of 7 business days after the respondent receives a copy of the application, or 5 business days after receiving notice of the adjudicator’s acceptance of the application: s 22. That adjudication response must also be in writing, and may contain submissions relevant to the response: s 22(2). An adjudication response may only be provided if the respondent provided the claimant a payment schedule within the time specified under the Act: s 22(3). The respondent must not include any reasons for withholding payment unless those reasons have already been included in the payment schedule that was provided: s 22(4).
75․In deciding an adjudication response, the adjudicator may ask for further submissions from either party, but must allow the other party to comment on any submissions made. The adjudicator may also “call a conference of the parties” and/or carry out an “inspection of any matter related to the claim”: s 23.
76․Section 24 of the Security of Payment Act provides that, in determining the adjudication decision, the adjudicator must only consider:
(a)this Act;
(b)the construction contract to which the application relates;
(c)the payment claim to which the application relates, together with any submission, including relevant documentation, properly made by the claimant in support of the claim;
(d)the adjudication application;
(e)the payment schedule, if any, to which the application relates, together with any submission, including relevant documentation, properly made by the respondent in support of the schedule;
(f)the adjudication response, if any;
(g)the result of any inspection by the adjudicator of any matter related to the claim.
77․The adjudicator must decide the adjudication application within an exceptionally short timeframe: s 23. As Leeming JA observed in Style Timber FloorPty Ltd v Krivosudsky [2019] NSWCA 171 at [39], “the entirety of the dispute is ordinarily required to be determined within some 15 business days of the adjudication application being made”.
78․An adjudication certificate may be filed as a judgment for debt, and may be enforced, in any court of competent jurisdiction: s 27.
79․Significantly, no part of the recovery procedure specified under pt 4 of the Security of Payment Act “affects any right” that a party to a construction contract may have under the contract, or for anything done or omitted to be done under the contract: s 38. In any proceeding before a court or tribunal in relation to any matter arising under a construction contract, the court or tribunal must, in any order or award made, take into account any amount paid to a party to the contract under or for the purposes of the Part, and also may make any appropriate orders for the restitution of any amount so paid, and any other orders considered appropriate, having regard to its decision in the proceeding: s 38(3).
80․Section 43 of the Security of Payment Act provides that a court does not have jurisdiction to set aside or remit an adjudication decision on the ground of error of fact or law on the face of the decision, but further provides that an appeal may be made to the Supreme Court with the consent of the parties, or with the leave of the Court, on any question of law arising out of an adjudication decision.
Determination
Overview
81․As outlined above, Canberra Building purported to issue a payment claim under s 15 of the Security of Payment Act. Having not received a response to the payment claim, Canberra Building commenced proceedings in the Magistrates Court for recovery of the amount sought in the payment claim pursuant to s 17(2) of the Security of Payment Act.
82․Canberra Building was entitled to judgment if it satisfied the Magistrate that WNA was liable to pay Canberra Building because WNA had “failed to provide a payment schedule … within the time allowed”, and WNA had not paid Canberra Building the whole or any part of the claimed amount on or before the due date for the progress payment: s 17 of the Security of Payment Act.
83․There was no dispute that WNA had not provided a payment schedule in response to the payment claim, and that WNA had not paid any part of the amount claimed on or before the due date. However, both parties properly accepted that the Magistrate could not enter judgment in favour of Canberra Building unless the payment claim issued by Canberra Building complied with s 15 of the Security of Payment Act.
84․As outlined above, the Magistrate held that s 15 had not been complied with for two reasons: first, because Canberra Building had not demonstrated that it had “give[n]” the payment claim to WNA in compliance with s 15(1) of the Security of Payment Act; and second, because the payment claim did not “identify the construction work or related goods and services to which the progress payment relates” in compliance with the requirement in s 15(2) of the Security of Payment Act. The appeal judge held that the Magistrate had erred in both findings. For the reasons outlined below, the appeal judge was correct to so conclude.
Service of the payment claim
85․As outlined above, in order to trigger the obligations specified in the Security of Payment Act, it is necessary for the subcontractor to “give” a payment claim to the person who is, or may be, liable to make the payment: s 15(1) of the Security of Payment Act.
86․The term “give” is not defined in the Security of Payment Act, and unlike legislation in other jurisdictions, there is no provision for a company to specify an email address for service of a payment claim: cf s 31 of the Building and Construction Industry Security of Payment Act 1999 (NSW).
87․Nonetheless, the term “give” is given content by ss 245, 247 and 250 of the Legislation Act 2001 (ACT). Specifically, s 245 of the Legislation Act provides that:
This part applies to a document that is authorised or required under a law to be served (whether the word ‘serve’, ‘give’, ‘notify’, ‘send’ or ‘tell’ or any other word is used).
88․Section 248(1)(d) of the Legislation Act (which is contained within the same Part) states that a document may be served on a corporation “by emailing it to an email address of the corporation”.
89․Section 250(3) of the Legislation Act provides:
If the sender [of an email or fax] has no reason to suspect that a document served by fax or email under this part was not received by the recipient when sent, the document is presumed to be served when sent unless evidence sufficient to raise doubt about the presumption is given.
90․The term “recipient” is defined in s 250(6) of the Legislation Act to mean “the individual, corporation or agency on whom the document is intended to be served”. The term “sender” is defined in the same subsection to mean “the person sending, or seeking to send, the document”.
91․Subsection 250(4) further provides:
(4)For subsection (3), the sender has reason to suspect that a document served by fax or email under this part was not received by the recipient when sent only if, on the day the document was sent or on the next working day, the equipment the sender used to send the document indicated by way of a signal or other message that—
(a)the equipment did not send the document when the equipment was used to send the document; or
(b)for a fax—the number to which the fax was sent to the recipient was not a fax number of the recipient; or
(c)for an email—the address to which the email was sent was not an email address of the recipient.
92․In view of the above provisions, it was not necessary for Canberra Building to prove that Mr Xia, or any other employee of WNA, had in fact received the payment claim in order to establish that the payment claim had been “given” to WNA.
93․In oral submissions, counsel for WNA accepted that Canberra Building was only required to prove that it sent the payment claim to WNA on the date alleged. Mr Reid’s evidence that he emailed the payment claim to the ‘accounts’ email address on 16 April 2020 was not challenged.[1] Accordingly, the only issue in dispute, both in the proceedings below and on this appeal, was whether the ‘accounts’ email address was a valid email address for WNA.
[1]Although Invoice No 217 contained a typographical error in the email address (see at [16] above), that typographical error does not appear in the copy of the email that was sent to the ‘accounts’ address.
94․We agree with the appeal judge that Canberra Building had established on the balance of probabilities that the ‘accounts’ email address was a valid email address for WNA. Our reasons for so concluding are as follows:
95․First, as the appeal judge held, Mr Reid gave evidence that he had “emailed the payment claim to [Mr] Xia”. This evidence was not challenged, or contradicted, by other evidence.
96․Second, an inference may be drawn from Mr Reid’s evidence that (i) “there was more than one email we could send [invoices] to”; (ii) Ms Campos and Mr Howman had asked him to send his invoice to “somewhere else”; (iii) he “already had [the ‘accounts’ email address]” at the time that he sent Invoice No 217 (emphasis added); and (iv) he had not found the ‘accounts’ address on the internet, that Mr Reid had been provided the ‘accounts’ email address by either Ms Campos or Mr Howman, both of whom would have been, by virtue of their positions, well familiar with the valid email addresses for WNA. (There was no suggestion that Mr Reid ever corresponded with any other WNA employee whilst Mr Xia was unavailable). Whilst not determinative, the similarity in the email extensions of Ms Campos’ email address and the ‘accounts’ email address provides further support for the drawing of this inference.
97․Third, WNA’s pleadings and Mr Xia’s witness statement are also of significance. As outlined above, WNA did not allege in its defence that it never received 16 April 2020 email; nor was the issue opened on by counsel for WNA. No pleadings point has ever been taken by Canberra Building. However, if Invoice No 217 had first been received by WNA in the course of the litigation in the Magistrates Court, one would have expected WNA’s defence to have clearly disputed receipt of the 16 April 2020 email, and for Mr Xia to have asserted in his witness statement that he had not seen the Invoice prior to the litigation (rather than simply stating that he had “seen” the invoice and that it was “confusing”).
98․The failure of WNA to adduce evidence that the ‘accounts’ email address was not an email address for WNA (whether from Mr Xia or from another director or employee of WNA) provides further support for a finding that the ‘accounts’ email address was a valid email address of WNA. In circumstances where there is already a strong inference to be drawn from the evidence that the 16 April 2020 email was received, it matters not that WNA did not bear the onus of proof: Ho v Powell [2001] NSWCA 168; 51 NSWLR 572 at [14] – [16]. As the High Court recently held in Willmot v Queensland [2024] HCA 42; 419 ALR 623 at [30], “[a]ll evidence is to be weighed according to the proof which it was in the power of one side to have produced, and in the power of the other to have contradicted”. It would have been an easy matter for WNA to adduce evidence that the ‘accounts’ email address was not a valid email address for the company. It did not do so.
99․Finally, as Canberra Building submitted, the appeal judge correctly rejected WNA’s contention that the rule in Browne v Dunn precluded Canberra Building from making a submission that the email had been “given” to WNA. As the appeal judge held, the rule in Browne v Dunne only applies where the witness has given evidence which contradicts the case of the party seeking to make the submission: Appeal Judgment at [128], citing Allied Pastoral Holdings Pty Ltd at 16. Mr Xia did not give evidence that the email was not received, and did not give evidence that the email addressed used did not relate to WNA.
100․Taking into account each of these matters, the appeal judge was correct to conclude that Canberra Building had established, on the balance of probabilities, that the ‘accounts’ email was a valid email address for WNA. Accordingly, this ground of appeal should be dismissed.
Was the payment claim sufficiently specific?
The principles to be applied
101․As noted above, s 15(2) of the Security of Payment Act provides as follows:
(2)A payment claim must—
(a)identify the construction work or related goods and services to which the progress payment relates; and
(b)state the amount of the progress payment that the claimant claims is payable (the claimed amount); and
(c)state that it is made under this Act (emphasis added).
102․Section 15(2) and comparable interstate provisions have been considered in a number of interstate appellate decisions. As each of those authorities emphasise, s 15 and like provisions must be construed within the context and in accordance with the purpose of the scheme created by Parliament under the Security of Payment Act.
103․Two features of the scheme are central to its operation. First, is the role of an experienced and trained adjudicator, which enables the provision of a “minimalist, hands off” alternative to “costly and protracted” court proceedings: Harlech at [47]. As can be seen from the summary of the legislation at [65] – [80] above, the “provisions are characterised by strict fast-paced time constraints, and a deal of informality”: Style Timber Floor at [26]. An experienced and trained adjudicator is well placed to determine, in this fast-paced environment, the proper construction of payment claims and payments schedules which are:
… given and received by parties who are experienced in the building industry and are familiar with the particular building contract, the history of construction of the project and the broad issues which have produced the dispute as to the claimant’s payment claim: Multiplex Constructions Pty Ltd v Luikens [2003] NSWSC 1140 at [76].
104․Second, the scheme adopts a “pay now, argue later” approach, which “does not decide final rights”, but “preserves them for later resolution”: Harlech at [48]. As Leeming JA observed in Style Timber Floor, the legislative purpose is to achieve “a prompt pro tem resolution of disputes and payment of monies, all without prejudice to the parties’ rights at law”.
105․These aspects of the scheme strongly support a construction of the Security of Payment Act which encourages resolution of disputes concerning payment claims within the adjudication system which the legislation creates, and which discourages recourse to the courts on issues relating to interim payments except in exceptional cases: see BSA Advanced Property Solutions (Fire) Pty Ltd v Ventia Australia Pty Ltd [2022] NSWCA 82; 108 NSWLR 350 at [35], citing Chase Oyster Bar Pty Ltd v Hamo Industries Pty Ltd [2010] NSWCA 190; 78 NSWLR 393 at [55] (“the purpose of the legislative scheme is best served by restricting the scope of intervention by the courts”). As Morrison JA observed in Ausipile Pty Ltd v Bothar Boring and Tunnelling (Australia) Pty Ltd [2021] QCA 223; 9 Qd R 220 at [100], “the whole scheme of the Act is designed to enable compulsory and fast payment to subcontractors, with issues to be determined at a adjudication rather than by traditional litigation”. This purpose is apt to be undermined by a construction of the legislation which enables a respondent to “simply ignore the payment claim” and to then litigate the validity of the claim when the claimant seeks to enforce its debt in a court of competent jurisdiction: Ausipile at [100] and Nepean Engineering Pty Ltd v Total Process Services Pty Ltd (in liq) [2005] NSWCA 409; 64 NSWLR 462 at [38].
106․Nonetheless, service by a claimant on the respondent of a payment claim is one of the “basic and essential requirements of the Act”: Claire Rewais and Osama rewais t/as McVitty Gove BPB Earthmoving Pty Ltd [2025] NSWCA 103 at [5], citing Brodyn Pty Ltd t/as Time Cost and Quality v Davenport [2004] NSWCA 394 at [53]; 61 NSWLR 421 at [53]. Further, there are “undoubtedly limits to the characteristics of a valid payment claim”, in particular, by the “use of the obligatory ‘must’ [in s 15(2)]”: BSA at [35]. Where the payment claim does not “identify the construction work or related goods and services to which the progress payment relates”, the respondent does not become “liable to pay the claimed amount to the claimant” under s 16(4) of the Security of Payment Act.
107․However, in view of the overarching purpose of the legislation, it also follows that the requirement is “not overly demanding”: Protectavale Pty Ltd v K2K Pty Ltd [2008] FCA 1248 at [11] – [12]. In particular, a payment claim is “not … required to be as precise and as particularised as a pleading in the Supreme Court”: Multiplex Constructions at [76]. The determination of the validity of a payment claim should be approached from the perspective of common sense; undue technicality is not required: Probuild Constructions (Aust) Pty Ltd v DDI Group Pty Ltd [2017] NSWCA 151; 95 NSWLR 82 at [109]. It is not necessary for the payment claim to “[explain] in every respect the means by which a particular claim item had been calculated”: T & M Buckley P/L v 57 Moss Rd P/L [2010] QCA 381; (2011) 27 BCLR 280 at [38]. Nor will an error or inaccuracy in the payment claim result in non-compliance with s 15(2), provided that the payment claim identifies the work in respect of which the claim is made: Bloc Constructions(ACT) Pty Ltd v ABS Façade (ACT) Pty Ltd [2023] FCA 1282 at [46].
108․As Perry J observed in Bloc Constructions at [44], the question whether the requirements of s 15(2) are satisfied is to be determined objectively. The subjective understandings of the parties are not relevant. However, as Perry J also observed in Bloc Constructions, this objective assessment is to be conducted “from the vantage point of the parties to the particular contract”: Bloc Constructions at [45], quoting KDV Sport Pty Ltd v Muggeridge Constructions Pty Ltd [2019] QSC 178 at [16]. In particular, the assessment takes into account the “background knowledge of each of the parties derived from their past dealings and exchanges of documentation”: Neumann Contractors P/L v Peet Beachton Syndicate Ltd [2009] QSC 376; [2011] 1 Qd R 17 at [25]; KDV Sport at [29]; Bloc Constructions at [45].
Contested questions of principle
109․As outlined above, a central principle that runs through the authorities is the importance of the adjudication system in speedily resolving disputes concerning interim payments.
110․Following from that principle, it has been held that “if a respondent is unable to identify some of the work in respect of which a payment claim is made”, a respondent should respond to the claim by way of a payment schedule which states that the respondent “does not propose to make any payment in respect of that work because it cannot identify the work”: see Nepean Engineering at [35].
111․However, WNA contended that such a response “does not give proper regard to the limitations of adjudication responses to matters raised in a payment schedule”. In particular, WNA noted that s 22 of the Security of Payment Act precludes a respondent from including “in the adjudication response any reasons for withholding payment unless those reasons have already been included in the payment schedule provided to the claimant”. WNA also noted that there is no equivalent prohibition on the content of an adjudication application: see s 21 of the Security of Payment Act. Counsel for WNA submitted that, in these circumstances,
… a ‘can’t identify’ payment schedule is, in truth, not a real exercise of the rights of the respondent, as the failure of a claimant to set out the construction work as required has deprived the respondent of its only opportunity to set out a substantive response to the work which is the subject of the claim.
See Nepean Engineering at [35].
112․WNA’s submission on this issue is predicated on an assumption that a claimant may respond to a “can’t identify” payment schedule by providing further particulars of the claim (which the respondent is then precluded from answering). The correctness of that construction may be doubted. Section 19 of the Security of Payment Act prescribes a number of requirements for a valid adjudication decision. Pursuant to ss 19(3)(f) and 19(3)(g), the adjudication “must identify the payment claim and any payment schedule to which it relates” and “may contain the submissions relevant to the application that the claimant chooses to include”. There is no provision for the claimant to include additional substantive matters in the adjudication application. There is a strong argument that a claimant cannot further particularise the payment claim in an adjudication application pursuant to s 19 of the Security of Payment Act. See further Ceerose Pty Ltd v A-Civil Aust Pty Ltd [2023] NSWCA 215; 112 NSWLR 225 at [75] – [77], concerning the statutory limitations upon the material that an adjudicator may consider.
113․It is not necessary to determine the correctness of WNA’s contentions with respect to the proper construction of ss 21 and 22 of the Security of Payment Act in this respect. An adjudicator must afford both the claimant and the respondent procedural fairness. Where a respondent files a payment schedule that indicates that a payment claim is disputed because the respondent cannot identify the work that was performed, and that contention is accepted (in other words, considered objectively, the work that was performed cannot be identified from the payment claim), it would amount to a breach of procedural fairness for the adjudicator to then make an adjudication in favour of the claimant on the basis of matters to which the respondent has not had (and cannot have) an opportunity to respond.
114․The appropriateness of a “can’t identify” payment schedule has been accepted by courts in New South Wales and in Queensland, including intermediate appellate courts: Nepean Engineering at [35]; Piety Constructions Pty Ltd v Megacrane Holdings Pty Ltd [2023] NSWSC 309 at [37]; BSA at [48]; Ausipile at [102]; TFM Epping Land Pty Ltd v Decon Australia Pty Ltd [2020] NSWCA 93 at [19] – [21].
115․The decisions of intermediate appellate courts in New South Wales and Queensland should be followed unless shown to be plainly wrong: Farah Constructions v Say-Dee Pty Ltd [2007] HCA 22; 230 CLR 89 at [135]. Not only are these decisions not plainly wrong; we consider that these decisions are clearly correct. In particular, the proposition that a respondent should not ignore a payment claim, and instead should respond with a ‘can’t identify’ payment schedule, accords with the purpose of the Security of Payment Act, as set out at [103] – [105] above.
116․Relatedly, WNA also contended that the appeal judge erred by not following Santow JA’s formulation in Nepean Engineering of the test to be applied where the validity of a payment claim is in issue, namely that a payment claim will not be valid unless there is:
… sufficient specificity in the payment claim for its recipient actually to be able to identify a “payment claim” for the purpose of determining whether to pay, or to respond by way of a payment schedule indicating the extent of payment, if any.
See Nepean Engineering at [48].
117․At first instance, the appeal judge held that this formulation did not correctly state the law. In particular, the appeal judge noted that Santow J had “disagreed” with Hodgson and Ipp JJA in Nepean Engineering: Appeal Judgment at [70]. His Honour also noted that in Protectavale, Finkelstein J had also adopted the formulation, but that his Honour had only cited the “dissenting” decision of Santow JA, and a first instance decision of Einstein J in John Holland Pty Ltd v Cardno MBK (NSW) Pty Ltd [2004] NSWSC 258 at [18] – [21] in support of that formulation. With respect to these authorities the appeal judge held (at [74]) that:
… the views of Hodgson and Ipp JJA should prevail where they diverge from those of Finkelstein J as their Honours’ reasoning prevails over that of Santow J. Equally, Einstein J’s decision must give way to the majority reasoning of the Court of Appeal.
118․WNA contended that the appeal judge’s rejection of Santow JA’s formulation was based on an “incomplete reading” of Nepean Engineering. Specifically, WNA noted that in Nepean, Santow JA “concurred in the result but wrote separately”. WNA contended that Santow JA’s reasons were “by way of addition and explanation, not dissent”. WNA also noted that after expressing the formulation described at [116․] above, Santow JA cited Hodgson JA’s judgment in Coordinated Construction Co Pty Ltd v Climatech(Canberra) Pty Ltd [2005] NSWCA 229, in which Hodgson JA held that “the relevant construction work or related goods and services must be identified sufficiently to enable the respondent to understand the basis of the claim”: Nepean Engineering at [48], citing Climatech at [25].
119․WNA’s contention that Santow JA was not “in dissent” is strictly correct. His Honour agreed with Ipp and Hodgson JJA that the appeal should be dismissed. However, it is not accurate to describe Santow JA’s reasons as “by way of addition and explanation” of the judgments of Ipp and Hodgson JJA. Justice Santow made clear that he “respectfully disagree[d]” with important aspects of the reasoning of the majority justices concerning the level of specificity required of a payment claim: Nepean Engineering at [47]. It matters not that Santow JA cited a decision of a member of the majority (Hodgson JA) in support of his own reasoning. It is clear that at least some aspects of Santow JA’s reasoning did not have the support of a majority of the Court.
120․Importantly, the area of disagreement included the minimum requirements for a valid payment claim. Hodgson JA held that “a payment claim that purports in a reasonable way to identify the work to which the progress payment relates” is not invalidated by reason of the respondent’s inability to identify the work in question. In such a case, the respondent’s remedy is to serve a payment schedule in which the response to that item is that the work can’t be identified: Nepean Engineering at [39]. The test posited by Ipp JA is arguably even less onerous: Nepean Engineering at [76]. Only Santow JA considered that a failure to provide sufficient specificity for the recipient “actually to be able to identify” the claim would result in it being treated as a nullity. Applying the principle stated by the majority, if the recipient of a payment claim ignores the claim rather than serving a payment schedule, they forgo the opportunity to have the claim adjudicated and foreclose the entitlement to raise a cross claim or defence in relation to matters arising under the contract: s 17(3)(b).
121․In dismissing the appeal, Hodgson JA observed (at [28]) that there was force in Nepean’s submission that the “work to which the payment claim related was not identified in the sense that, in all of the circumstances, the material in the payment claim was not sufficient to convey to Nepean just what was the work for which payment was claimed”. However, his Honour continued, “even if that is correct, this would not necessarily justify allowance of the appeal”, as there was “a substantial question whether this would make the document other than a payment claim under the Act” [at [28]]. It is apparent that Santow JA did not agree with this aspect of Hodgson JA’s decision.
122․Ultimately, however, the difference in the reasoning between Ipp and Hodgson JJA, and Santow JA in Nepean Engineering would appear to be one of degree rather than of substance. Justice Hodgson ultimately concluded that a “payment claim which purports in a reasonable way to identify the work in respect of which the claim is made” is sufficient to support both an adjudication by an adjudicator and a cause of action under s 15: Nepean Engineering at [37] – [38]. In using the term “purport”, we do not understand Ipp JA to have been suggesting that a payment claim need only describe itself as a payment claim. Rather, his Honour was simply emphasising that a payment claim which does not identify every aspect of the work that was performed is not invalid for that reason alone. Provided there is a reasonable identification of the work that was performed, the payment claim will be valid.
123․The applications of these principles in cases decided since Nepean Engineering are consistent with this analysis. In particular, it is now well accepted that a valid payment claim must “reasonably [identify] the construction work to which it related such that the basis of the claim [is] reasonably comprehensible to [the recipient]”: Bloc Constructions at [41], citing T & M Buckley at [38]; see also KDV Sport at [16]. Complete comprehensibility is not required. Nor is “sufficient specificity in the payment claim for its recipient actually to be able to … [determine] whether to pay, or to respond by way of a payment schedule indicating the extent of payment, if any”: Nepean Engineering at [48]. Rather, where there is insufficient detail in a payment claim to enable a respondent to determine “whether to pay”, or “the extent of payment”, a respondent should respond by way of a payment schedule which states that the respondent “does not propose to make any payment in respect of that work because it cannot identify the work”.
Application
124․The invoices that were incorporated into the payment claim in the present case are summarised at [18] – [24] above.
125․As can be seen from the above, the invoices varied in detail. Each invoice expressly specified the dates, hours worked and rates of payment. The invoices also separated labour and materials, and separately listed the materials supplied and the amount charged for each. In many instances, the person carrying out the work (labourer/ foreman) is stated. In those instances where it is not stated, the identity of the worker may be readily ascertained from the hourly rate. In some instances, the invoices described the work performed (eg Invoice No 202, extracted at [22] above), whereas in other instances (eg Invoice No 193, extracted at [18] above), no particulars were provided of the nature of the work performed, although it may be that an experienced builder could make reasonable inferences with respect to the work performed based on the materials used. None of the invoices separately particularised the work performed by reference to job site. Each invoice related to at least two job sites.
126․WNA’s primary complaint is that the invoices covered a number of individual work sites. In oral argument, Mr Buckland accepted that a number of the invoices would have contained an appropriate level of detail if they had clearly specified the individual sites on which work was performed.
127․We do not accept that this kind of detail was required for the payment claim to be valid. The contract in issue was framed in general terms. The contact provided for the hourly rates for various workers (builder/ project manager and carpenter), and then listed a number of sites with various work to be performed at each site (eg “brick work cladding”; “paint”’; “finish roof”; “install windows”).
128․For a contract that provided for work to be performed, on an hourly basis, across different work sites, we do not consider that it was a necessary criterion for the validity of the payment claim for the work performed at different sites to be separately specified. By way of analogy, if a contract provided for work to be done on a very large site, a payment claim would not be invalid simply because it failed to state where on the site particular work was performed.
129․In circumstances where the invoices lacked detail, it is possible, perhaps even likely, that, if WNA had responded to the claim by way of a payment schedule which alleged that the payment claim was not sufficiently specific to enable a proper response, an adjudicator would not have allowed many, and perhaps even all, of the claims made by Canberra Building in the payment claim. However, the question for determination by this Court is not whether an adjudicator would, or should, have concluded that the payment claim was sufficiently detailed to justify the making of a determination in favour of Canberra Building. In the present case, even the most sparse of the invoices annexed to the payment claim specified the hours worked and the hourly rate for the claim. In our view, the appeal judge correctly held that the payment claim was sufficient to satisfy the minimal requirements of the Security of Payment Act.
130․The appellant has not established error in the appeal judge’s determination. Accordingly, the decision of the appeal judge which entered judgment in favour of the respondent, with interest and costs is affirmed. Of course, as outlined above, this conclusion does not affect any aspect of any underlying contractual dispute between the parties.
Orders
131․For the above reasons, the appeal should be dismissed with costs to be paid by the appellant.
| I certify that the preceding one hundred and thirty-one [131] numbered paragraphs are a true copy of the Reasons for Judgment of the Court. Associate: H Clift Date: 4 June 2025 |
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