BUILDING AND CONSTRUCTION — application to set aside adjudication determination under Building and Construction Industry Security of Payment Act 1999 (NSW) as procured by fraud — builder partially paid in cash — builder said to have failed to recognise all cash in adjudication application — principles at [7]-[22] — overstatement of “claimed amount” does not affect operation of legislative scheme nor defraud adjudicator in the exercise of their statutory powers.
FRAUD — problems with identical affidavits, at [25] — difficulty in proving cash payments, at [63] — whether builder initialled receipt, at [66] — poor records — fraud not established in any event.
DECLARATIONS — owners seek declaratory relief that builder has been paid — substantive proceedings on foot in NCAT — contrary to SOPA scheme to go beyond jurisdictional challenge — decline to make declarations.
Quick Take
1An adjudication determination under the Building and Construction Industry Security of Payment Act 1999 (NSW) may be quashed in the Supreme Court's supervisory jurisdiction for fraud in the broad public law sense, which includes bad faith. The inquiry is whether actual fraud or dishonesty affected the operation of the legislative scheme and the adjudicator's exercise of statutory powers (SZFDE; DUA16). It is not governed by the Wentworth v Rogers requirement of newly discovered material, and QC Communications v CivComm should not be read as so confining relief.
2A claimant who overstates the 'claimed amount' in a payment claim or adjudication application by failing to acknowledge payments already received does not thereby affect the operation of the SOPA scheme or defraud the adjudicator. The scheme gives the respondent notice of the claimed amount and a fair opportunity to contest it by payment schedule. Characterising the overstatement as 'fraud' does not change that conclusion.
3On the facts, the alleged undocumented cash payments were not proved to the standard required by s 140(2) of the Evidence Act 1995 (NSW) and Briginshaw. A receipt the builder initialled was found to be a document jointly prepared to support the owners' construction finance application rather than evidence of payment, and initials on a 'running sheet' were found to record cumulative progress rather than discrete cash receipts.
