Patrick Stevedores Operations No. 2 Pty Ltd v McConnell Dowell Constructors (Aust) Pty Ltd

[2014] NSWSC 1413

Supreme Court of NSW

View on CaseLaw

Built by Barristers,
For Australian Law.

See how it works

Interrogate

Catchwords

1. BUILDING AND CONSTRUCTION — Building and Construction Industry Security of Payment Act 1999 (NSW) — application for declarations that two adjudication determinations concerning same payment claim void — validity of payment claim — whether one-off payment due under contract after termination a "progress payment" capable of supporting a payment claim — whether reference date fixed by contract or s 8(2)(b) — effect of termination before contractual reference date arises — whether party entitled to withdraw adjudication application under s 26 and file new adjudication application — whether jurisdictional error where adjudicator failed to consider all claims and submissions — whether denial of natural justice where adjudicator decided matter on basis not put by either party

Quick Take

The Court held that a payment claim for amounts due under a termination-for-convenience clause was not a valid claim under the Security of Payment Act because: (1) costs of plant/materials ordered and site removal costs are not 'construction work' or 'supply of related goods and services'; (2) where the contract provides reference dates for progress claims, s 8(2)(b) does not apply, and where termination occurs before the next contractual reference date arises, no reference date exists for work done after the last pre-termination reference date; and (3) contractual payment provisions (other than those expressly stated to survive termination) cease to operate on termination. The Court also held, in obiter, that an adjudicator who assigns zero values to claims due to insufficient time has failed to determine the application within s 21(3), enlivening the claimant's s 26 withdrawal and re-application rights, and that an adjudicator who adopts a valuation methodology not advanced by either party without giving the parties an opportunity to be heard commits a material denial of natural justice.